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Amarin (AMRN) Q1 Earnings Top, Vascepa Sales Hit by COVID-19

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Amarin Corporation PLC AMRN reported first-quarter 2021 adjusted earnings of 3 cents (excluding stock-based compensation) per American depositary share (“ADS”) compared to an adjusted loss of 3 cents in the year-ago period. The Zacks Consensus Estimate was pegged at a loss of 3 cents.

Revenues, primarily from its cardiovascular drug, Vascepa, were down almost 8.3% year over year to approximately $142.2 million in the quarter, missing the Zacks Consensus Estimate of $146.83 million.

Shares of Amarin were up 2.1% on Apr 29, following the earnings beat. The stock has gained 6.1% so far this year against the industry’s 0.6% decrease.

Quarter in Details

Product revenues, entirely from Vascepa, were $141.4 million, down 7.1% year over year. Sales of the drug were hit due to fewer patients visits to doctors as a result COVID-19, regional weather issues and generic competition. Moreover, the company had included $10.8 million in Vascepa sales as a result of a shipment timing anomaly in the year-ago quarter that was absent during the reported quarter.

However, the company stated that there were early signs of potential recovery from the effects of COVID-19, including higher rates of patients new to the brand and more prescribers of Vascepa. Moreover, the company stated that the price of Vascepa has been reported to be lower than the available generic version by several insurance companies and patients.

Per IQVIA, normalized prescriptions for Vascepa increased approximately 4% year over year in the United States during the first quarter of 2021.

We note that Hikma Pharmaceuticals launched a generic version of Vascepa in the United States in November last year. The generic’s label includes reduction of triglyceride levels indication but not the cardiovascular risk reduction indication. Please note thatDr. Reddy's Laboratories RDY, Teva Pharmaceuticals TEVA and Apotex Pharmaceuticals are other contenders that may launch a Vascepa generic for a similar indication.

Licensing revenues were $0.8 million in the first quarter compared with $2.8 million in the year-ago period.

The company ended the quarter with $538.7 million in cash and investments, compared with $563.4 million as of Dec 31, 2020.

Vascepa Update

Earlier this month, Amarin received marketing authorization for Vazkepa (Vascepa) in Europe and the United Kingdom for two indications — adjunct therapy to reduce cardiovascular risks and adjunct therapy to reduce triglyceride level. The drug is approved for both these indications in the United States. The company plans to launch the drug in Europe in the third quarter of 2021.

The drug is expected to receive approval in Mainland China and Hong Kong by the year-end.

These developments are likely to boost the prospects of the drug going forward as Europe and China represent significant market opportunity. Also, there is no generic overhang in these two territories so far.

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 & Stock to Consider

Amarin currently carries a Zacks Rank #3 (Hold).

A better-ranked company from the biotech sector is Avid Bioservices, Inc. CDMO, carrying a Zacks Rank #2 (Buy). Earnings estimates for 2021 and 2022 have risen 80% and 53.8%, respectively, over the past 30 days. The stock has risen 89.2% so far this year.

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