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Amarin (AMRN) Beats on Q2 Earnings, Focuses on Europe

Zacks Equity Research

Amarin Corporation PLC AMRN reported second-quarter 2020 adjusted earnings of 4 cents (excluding stock-based compensation) per American depositary share, in contrast to the Zacks Consensus Estimate of a loss of 4 cents. The company had recorded adjusted earnings of 2 cents in the year-ago period.

Revenues, primarily from its cardiovascular drug, Vascepa, were up almost 34.3% year over year to $135.3 million in the quarter, missing the Zacks Consensus Estimate of $149.86 million.

Shares of Amarin were up 3.8% on Aug 4, following the earnings announcement. The stock has declined 67.2% so far this year against the industry’s 6.7% increase.

Quarter in Details

Product revenues, entirely from Vascepa, were $133.7 million, up 33.2% year over year. Strong demand for the drug continues to drive sales higher. Sales in ex-U.S. market, primarily from Canada, were $1.8 million.

Per IQVIA, normalized prescriptions for Vascepa increased approximately 44% year over year in the United States.

However, sales were down 12.2% sequentially. We note that revenue and prescription growth for Vascepa was slower than the past few quarters. The decline in pace was due to lower patient visits to medical offices and lower number of routine lab tests amid travel and mobility restrictions related to COVID-19. The company stated that patient visits to physicians remained approximately 35% below pre-COVID-19 levels during the week ending Jul 3 per IQVIA.

Licensing revenues were $1.6 million in the second quarter compared with $0.4 million in the year-ago period.

Adjusted selling, general and administrative expenses were up 23.6% to $82.3 million due to costs related to an expanded sales force, partially offset by decrease in consumer-focused promotion.

Adjusted research & development expenses surged 34.6% to $8.2 million due to further analysis of samples collected from REDUCE-IT patients, payment of milestone to its partner and costs to support various publications and pilot studies.

The company ended the quarter with $611.3 million in cash and investments, compared with $623.7 million as of Mar 31, 2020.

Vascepa Update

Amarin initiated phased redeployment of sales representatives in the United States in a manner consistent with all regulations in June. The company also launched its first ever direct-to-consumer campaign for Vascepa’s expanded label approved late last year.

The company plans to maximize the blockbuster potential of the drug in Europe through its own dedicated European commercial organization, following a potential approval. The company anticipates an approval in Europe to come in early 2021. It recently began expansion of its commercialization team for Europe.

Patent Litigation

In March 2020, Amarin announced that the United States District Court for the District of Nevada ruled in favor of the generic companies related to patent litigations against Vascepa’s hypertriglyceridemia indication. Please note that the patent litigations do not include Vascepa’s expanded label based on REDUCE-IT study.

However, the company has strongly opposed the court’s ruling and has filed an appeal against it. A hearing date of Sep 2 has been scheduled by the U.S. Court of Appeals.

Amarin Corporation PLC Price, Consensus and EPS Surprise

Amarin Corporation PLC Price, Consensus and EPS Surprise
Amarin Corporation PLC Price, Consensus and EPS Surprise

Amarin Corporation PLC price-consensus-eps-surprise-chart | Amarin Corporation PLC Quote

Zacks Rank and Other Stocks to Consider

Currently, Amarin is a Zacks Rank #2 (Buy) stock.

Some other top-ranked stocks from the biotech sector include Emergent Biosolutions Inc. EBS, Horizon Therapeutics HZNP and Unum Therapeutics Inc. UMRX, all sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Emergent Biosolutions’ earnings per share estimates have moved up from $3.45 to $3.58 for 2020 in the past 30 days. The company delivered an earnings surprise of 127.41%, on average, in the last four quarters. The stock has risen 145.7% so far this year.

Horizon Therapeutics’ earnings per share estimates have increased from $1.78 to $2.00 for 2020 in the past 30 days. The company delivered an earnings surprise of 43.99%, on average, in the last four quarters. The stock has surged 97.9% so far this year.

Unum Therapeutics’ loss per share estimates have narrowed from 53 cents to 47 cents for 2020 in the past 30 days. The company delivered an earnings surprise of 36.6%, on average, in the last four quarters. The stock has surged 294.3% so far this year.

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