After Amarin Snags Vascepa Label Expansion, Analyst Says Biopharma An Attractive M&A Target

Christmas came early for Amarin Corporation plc AMRN with the FDA's approval of an expanded label for its fish oil pill Vascepa ahead of a scheduled Dec. 28 decision date. 

The label expansion approved Friday includes the indication of cardiovascular risk reduction in elevated triglyceride patients with established CV disease or diabetes and two or more additional risk factors for CV disease.

The Analysts

H.C. Wainwright analyst Andrew Fein reiterated a Buy on Amarin with a $51 price target. 

Cantor Fitzgerald analyst Louise Chen maintained an Overweight rating and $35 price target.

Vascepa Redefines CV Treatment Landscape

After the unanimous backing of an FDA panel in an Adcom meeting held in November, the approval was expected, H.C. Wainwright's Fein said in a Monday note. 

The additional clarity on the breakdown of the labeling is a positive, the analyst said. 

The characterization of triglyceride levels at 150 mg/dL did not comes as a surprise, he said. 

Physicians can use their best judgment to assess whether to assign the proven benefits of Vascepa in CV risk reduction when evaluating at-risk patients, Fein said. 

"As an adjunctive therapy to maximally tolerated statin therapy, we believe Vascepa has succeeded in redefining the CV treatment landscape." 

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The analyst said the fact that the risk of bleeding and atrial fibrillation or flutter did not pose labeling limitations is reassuring. 

Vascepa has broad physician support with an expanded label in risk reduction, Fein said, citing a proprietary omega-3 physician survey conducted in June 2019 by H.C. Wainwright. 

Based on the survey findings and the updated revenue guidance, the firm maintained its Vascepa sales revenue estimates of $416 million for 2019 and $663 million for 2020.

Physician education is the key to reaching the potential within the omega-3 market, Fein said. 

Label Expansion Makes Amarin Attractive M&A Target

The defined Vascepa patient population is in line with Street expectations, Cantor analyst Chen said in a Monday note.

The focus is now on whether the company settles with Vascepa generic filers, with a trial due on Jan. 13, 2020, the analyst said

If acquired, the label expansion has rendered Amarin as an even more interesting asset in a consolidating space, Chen said. 

"The FDA believes that today's approval will give patients with elevated triglycerides and other important risk factors, including heart disease, stroke and diabetes, an adjunctive treatment option that can help decrease their risk of cardiovascular events." 

Price Action

Amarin shares were trading 3.73% higher to $25.10 at the time of publication Monday. 

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