Amarin Corporation plc (NASDAQ:AMRN): Defending IP, Advancing Europe, and Maintaining Profitability in the U.S.

Published on September 24, 2024 | Ticker: AMRN

Amarin Corporation plc, a pharmaceutical company focused on the commercialization and development of therapeutics to improve cardiovascular health and reduce cardiovascular risk, has delivered a mixed performance in the first quarter of 2024. While the company faced challenges in its U.S. business due to generic competition, it made significant strides in strengthening its intellectual property position in Europe and advancing its commercial efforts in key European markets.

Financials

In the first quarter of 2024, Amarin reported total net revenue of $56.5 million, including net product revenue of $55.2 million and $1.4 million of licensing and royalty revenue. This represents a decrease from the $86.0 million in total revenue reported in the first quarter of 2023. The decline in revenue was primarily driven by a 41% decrease in VASCEPA sales in the United States, which came in at $48.1 million in the first quarter of 2024 compared to $82.3 million in the same period of the prior year. This decrease was due to a decline in net selling price as a result of the continued impact from generic competition in the market.

Despite the revenue decline in the U.S., Amarin's overall gross margin on net product revenue remained stable at 55% in the first quarter of 2024 and 2023. Excluding inventory restructuring charges in the first quarter of 2023, the gross margin was 70%. The company's U.S. business continues to deliver significant profitability, which is funding its efforts in Europe.

European Performance

On the European front, Amarin reported product revenue, net, of $1.9 million in the first quarter of 2024, a 35% increase compared to the fourth quarter of 2023. This growth was primarily driven by strong performance in Spain and the United Kingdom. In Spain, the number of patients on VAZKEPA therapy increased by 91% in the first quarter of 2024 compared to the fourth quarter of 2023, while in the UK, the number of patients on VAZKEPA therapy increased by 28% over the same period.

Intellectual Property

Amarin's progress in Europe is underpinned by the company's successful efforts to strengthen its intellectual property position for VAZKEPA. In April 2024, the company announced that it had extended the exclusivity for VAZKEPA in Europe until 2039, eight years beyond the data exclusivity period of 2031. This was achieved through the successful defense of a European VAZKEPA patent from third-party opposition and the granting of a new patent by the European Patent Office.

Global Expansion

In addition to the commercial progress in Europe, Amarin and its partners continue to make regulatory and market access advancements in other key markets around the world. In China, the company's partner, Edding, delivered a 100% increase in VASCEPA sales growth in the first quarter of 2024 compared to the fourth quarter of 2023. The regulatory review process for the cardiovascular risk reduction indication in China remains on track.

In Canada, HLS Therapeutics continues to make progress in securing public and private payer coverage for VASCEPA, while in Australia, Amarin's partner, CSL Seqirus, is advancing the submission for VAZKEPA reimbursement with local health authorities.

Cost Management

On the cost management front, Amarin reported operating expenses of $45.5 million in the first quarter of 2024, a $20 million reduction compared to the same period in 2023. The company is on track to deliver a $40 million reduction in operating expenses by July 2024 as part of its organizational restructuring program announced in the third quarter of 2023.

Liquidity

As of March 31, 2024, Amarin reported aggregate cash and investments of $308 million, maintaining a stable cash position over the last seven quarters. The company has also secured shareholder approval for a share repurchase program of up to $50 million, with the next step being to secure U.K. High Court approval, after which the share repurchases are expected to commence in the second quarter of 2024.

Outlook

Looking ahead, Amarin remains focused on maximizing the value of VASCEPA/VAZKEPA globally. In the United States, the company will continue to defend its intellectual property and explore options, including the potential launch of an authorized generic, to maintain its market leadership position. In Europe, the company is committed to advancing its pricing and reimbursement efforts in key markets, building on the momentum seen in Spain and the UK.

Amarin's financial performance in the first quarter of 2024, with annual net income of -$59.3 million, annual revenue of $308.1 million, annual operating cash flow of $6.9 million, and annual free cash flow of $6.4 million, reflects the challenges faced in the U.S. market, as well as the company's ongoing investments in its European and global expansion efforts.

Conclusion

Despite the headwinds in the U.S., Amarin remains well-positioned to navigate the dynamic market environment. The company's strengthened intellectual property position in Europe, the progress made in key European markets, and the continued profitability of its U.S. business provide a solid foundation for the company's future growth and value creation.

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