Amarin Corp Plc (AMRN)

[TalShu]

Quote: “I am curious about what you expect from your (presumed)
Amarin investment.”

My expectation has shifted from the realm of finance to that of hope as management continues to show lack of credibility, interest in shareholders’ concerns, and incoherence.

Why?

Allow me to explain by focusing on the last pillar of KM’s three-pronged Strategic Vision (Height – Portfolio diversification; Depth – Operational Evolution; and Breadth – Geographic Expansion).

Amarin maintains international growth expansion through partnerships represents a one billion-dollar opportunity. (This will always be reflected in Slide (6) of the quarterly presentations and annual reports).

Amarin’s partnerships, established in the pre-KM era, include:

- HLS Therapeutics, Inc – a publicly traded company listed on the Toronto Stock Exchange. Area of competence: exclusive representation in Canada.

- Eddingpharm (Asia) Macao Commercial Offshore Limited (Edding), – a private company based in Macao. Area of competence: Hong Kong and Mainland China.

- Biologix FZCo – a private company based in Dubai Airport Free Zone. Area of competence: MENA.

KM’s Strategic Vision incorporates and builds on these partnerships.

What is MENA?

This acronym stands for Middle-East North Africa. It was first coined by the World Bank to delimit a region embracing 18 Arab countries that total nearly a 410 million youthful population. Moody’s subdivides this area into North Africa, The Levant, and the GCC (Gulf Cooperation Council) in its sovereign reports while leaving out Yemen (population 38 million; one of the ten poorest countries in the world; at war with its neighbors: humanitarian disaster; cholera back).



Let us take a closer at MENA using Moody’s classification:

A. North Africa:

- Libya: population (6 million); oil rich; in total chaos.
- Tunisia: population (11 million); in a state of undeclared bankruptcy accompanied by political instability; Hikma present with production facilities; last week Bayer, GSK and Novartis closed their offices.
- Algeria: population (44 million); oil and gas rich; rent economy suffering from 50 years of centralized socialist economic (mis)management; embryonic private sector. Hikma strongly implanted with production facilities.
- Morocco: population (37 million); poor masses; number one phosphate exporter; attracting foreign investment; dynamically opening up to sub-Saharian African markets; relies on generics - Hikma commercial and partnership (licensing) presence.

B. The Levant

- Sudan: population (35.5 million); poor masses; very rich agricultural lands poorly exploited; political and economic instability; Hikma commercial and partnership presence accompanied by social and humanitarian assistance in the aftermath of natural disasters (building schools after floods …).
- Egypt: population (102 million); poor masses; just obtained an IMF loan; sustained by Saudi and Emirati financial support for political reasons; Hikma production facilities.
- Somalia: population (10.5 million); disintegrated polity; poor masses; humanitarian disaster (At least 1.5 million children under five are acutely malnourished, with more than 385,000 children at risk of dying without immediate care).
- Jordan: population (10 million); scarce natural resources; weak economy; absence of middle class; home of Hikma founders; Hikma MENA headquarters; Hikma US FDA inspected plants.
- Syria: population (17 million); completely destroyed by a decade-long on-going war; cholera is back.
- Lebanon: population (7 million); bankrupt; sempiternal political instability due to sectarianism; Hikma marketing presence.
- Iraq: population (41 million); oil rich; huge political instability; de facto divided since the Gulf War;120 billion dollars in yearly revenues vanish in the pockets of corrupt politicians and the Iranian government’s chest; 20% of the population is looking for food in garbage bins.

C. The Gulf Cooperation Council (GCC)

- Kuwait: population (4 million – 60% expatriates); oil rich; Hikma presence; free health care for nationals.
- Qatar: population (3 million – 90% expatriates); oil and gas rich; free health care for nationals.
- Bahrain: population (1.7 million – 52% expatriates); off-shore banking hub; poor economy; Saudi Arabian financial and security support reflected by credit agencies’ ratings; free health care for nationals.
- United Arab Emirates: population (10 million – 90% expatriates); oil-rich Abu Dhabi sovereign funds = 1.3 trillion dollars); non-oil service-oriented merchant Dubai facing an economic recession; regional trading hub; notable marketing presence of Hikma; newly established diplomatic relations and rapidly expanding commercial relations with Israel, including pharmaceuticals (think Teva); free health care for nationals.
- Saudi Arabia: population (36 million – 38% expatriates); oil rich; endowed with important mineral resources not yet exploited; Hikma US FDA inspected plants; free health care for nationals.
- Oman: population (5 million – 30% expatriates down from 45% due to economic recession); small oil and gas resources; Hikma presence; free health care for nationals.

D. This brief overview shows that only Qatar, Saudi Arabia, Kuwait and UAE (together hosting 50 million out of the 410 million MENA population) can afford Vascepa, Still, excluding tiny Qatar which - with its 30 billion dollars annual revenue – is blasé, the remaining three have a clear preference for branded generic products. Just examine the overwhelming generic preference on the Saudi Human Drugs list (https://www.sfda.gov.sa/en/drugs-list).


Amarin – Biologix FZCo Partnership

- In 2016, Amarin signed a partnership agreement with Biologix FZCo (https://biologixpharma.com) that is presented as “a pioneer in the distribution of pharmaceutical and biological products in the Middle East and North Africa (MENA) region” - FZCo standing for Dubai Airport Free Zone Company.

- The UAE hosts a number of free zones whose primary purpose is tax avoidance. No premises are needed and a P.O.Box is facilitated. Any established company may then add telephone landline and mobile numbers and e-mail addresses on its website. In addition to the UAE, Biologix has such information for Lebanon and Saudi Arabia; but no premises anywhere. The website also lacks transparency regarding its ownership, management, human and financial resources, and concrete verifiable data-backed achievements. It was by chance that its general manager’s name, Ms. Zeina S. Lahoud, appeared underneath a photo on the second page of the website’s “News” section (https://biologixpharma.com/news).

- On March 21, 2018 a press release read "AMARIN Announces First Middle East Approval for Vascepa". This concerned Lebanon.

- Today, the website of the Lebanese Ministry of Public Health does not include Vascepa on the Lebanon National Drugs Database. Neither is Amarin on the list of laboratories present in Lebanon (https://www.moph.gov.lb/en/Drugs/index/3/4848/lebanon-national-drug-index-lndi-/page:176/sort:Drug.brand_name/direction:asc).

- Also, today’s google search for Vascepa through a number of Lebanese pharmacies operating on-line yielded a “No results found”.

- Anyone who cares to review Amarin declarations, PRs, official quarterly revues for the years 2019 & 2020 would note management’s assertions that Vascepa is “available” and/or “sold in Lebanon and UAE (I made a table out of this). Amarin has failed to date to publish the revenues generated from these activities to corroborate its claims.

- What a strange partnership obtains between a NASDAQ listed corporation and an obscure entity that, someone knowledgeable with the area, would confidently bet it is Lebanese - a partnership at the heart of Amarin’s Strategic “BOLD” Vision! That John Thero lacks insight into MENA might be understandable. But for KM, a Middle Easterner at birth, to entertain, in an endless TV-like series, the mirage of a huge MENA opportunity, whose beneficiaries are only the eight BOD members, is rather pitiful.

- On July 26, 2018 another press release was sent out: "AMARIN Announces Approval of Vascepa for United Arab Emirates.” Etcetera … Etcetera … Etcetera. Life goes on to the next episode.

- On August 3, 2022 Amarin PRed: “Biologix, Amarin’s partner in the Middle East and North Africa (MENA), received the official registration certificate for VASCEPA from the Kingdom of Saudi Arabia (KSA) regulatory authority for the treatment of severe hypertriglyceridemia. This first approval in KSA enables the preparation and submission of a variation to seek review and approval for the CV risk reduction indication” paving the way for KM to declare, three months later, “expansion in Saudi Arabia and Bahrain ACHIEVED” (Q3 2022 Earnings and Conference Call). Neither official Saudi information attests to that nor has Biologix boasted about this achievement, six years after signing the famous partnership agreement.

I refrain from going further. Suffice it that management shows us the corresponding revenue numbers.

I hope to have answered your question.

Quote: Do you have an opinion on Denner?

Alexander Denner’s appearance in this saga has brought a glimmer of light/hope.

- Hope that shareholders might be relieved from management’s deafness/arrogance. At last, someone is listening and not hearing.

- Listening is the main virtue of a true leader. It affords him the advantage of analyzing and of ensuring that one addresses issues and matters in an appropriate manner and with that level of importance they may or may not warrant. One would also be in a better position to address matters in the appropriate language, thus ensuring one is heading in the right direction.

- Shutting down, pretending to listen and pretending to address others’ interest is far from looking ahead long term. No leader with a vision, be it bold or ordinary, can ever ignore the messages people are transmitting, particularly if they come with a certain level of enthusiasm and/or concern. Failing to listen means there is either a defective structure or that, alternatively, there is no true leader but an administrator.

I sent a kinesics expert friend of mine a (YouTube) interview of Denner as well as the last two letters Sarissa put out. His diagnostic was: “He is humane. He emits confidence while showing use of active listening. Professional with a structured mind; has a vision. He is a leader.”

My friend’s words comforted my intuitive feelings.

Am grateful to Dr. Denner. May God enlighten the path before him.

Quote: “As to India my opinion is AMRN would need the right "partner" for that to work”

Maybe this right “partner” is closer to Zug. Novartis’ CEO is Indian. So are the CEOs of Google, Microsoft, Adobe, Net App, Master Card, DBS, Diageo, SanDisk, Harman, Micron, Palo Alto Networks, Reckitt, IBM, as well as the British Prime Minister, the British Minister of Interior, the Irish Prime Minister, the US Vice President . . .

All the best.