AMRN cc @7..Amarin still halted; Leerink Swann slashes PT by two-thirds, Aegis downgrades
Amarin (AMRN +3.2%) shares remain halted in AH trading after an FDA panel voted 9-2 against recommending an expanded drug label for Vascepa.The beginning among what is sure to be several changing analyst outlooks, Leerink Swann slashes its PT to $6 from $18 (after upgrading AMRN to Outperform on Monday) while Aegis Capital downgrades the stock to Hold from Buy.After panelists noted that "more clinically relevant measures of efficacy (i.e., REDUCE-IT cardiovascular event data) are needed before exposing a much larger number of patients," Leerink analyst Joseph Schwartz thinks there is a "a 10% probability of 'ANCHOR' approval on the 12/20/13 PDUFA date, a 40% probability of approval in 2017 after REDUCE-IT data in 2016, and a 50% approval of no label expansion ever. We assume peak Vascepa sales in 2030 of $2.6bn/$2.1bn/$1.2bn in these three scenarios."Aegis's Ram Selvaraju thinks AMRN shares could be "range-bound for a significant period of time." Particularly ominous: "The fact that the firm will have to find a way to reduce expenses and drive revenues with only a narrow label in hypertriglyceridemia for Vascepa negates any likelihood of an acquisition near-term, in our view. In addition, because of the company's envisaged operational burn rate, we anticipate that Amarin could be forced to raise additional capital multiple times before the REDUCE-IT data become available."
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