Amarin Analysts Say Vascepa Patent Settlement Not A Stock Mover, With 'Little Readthrough For Pending Patent Appeal'

Amarin Corporation plc AMRN announced late Tuesday a settlement agreement with Apotex for resolving a patent lawsuit regarding a generic version of Amarin's drug Vascepa. 

The Amarin Analysts: Cantor Fitzgerald analyst Louise Chen reaffirmed an Overweight rating and $35 price target. 

Stifel analyst Derek Archila reiterated a Hold rating.

SVB Leerink analyst Ami Fadia has an Outperform rating and $9 price target.

Settlement Could Move Sentiment For Amarin: The settlement agreement is good news, especially as it comes after Amarin lost the case with two other generic manufacturers, Hikma and Dr.Reddy's Laboratories Ltd RDY, Cantor's Chen said in a Tuesday note. 

If Apotex felt it had a chance, it would have waited a few months for a near-term opportunity rather than waiting until 2029, the analyst said. 

Amarin is appealing a patent invalidity ruling from March to the U.S. Court of Appeals, she said. 

"We think this settlement could potentially move sentiment toward a potential win for AMRN." 

The settlement prevents Apotex from selling a generic version of Vascepa in the U.S. until Aug. 9, 2029, or earlier under certain circumstances, such as Amarin being unsuccessful in its pending appeal of the March decision from a district court in Nevada, according to Cantor Fitzgerald. 

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Stifel Says Settlement Not a Major Catalyst: The settlement agreement is a slight positive but is not a major stock-moving catalyst, Stifel's Archila said in a Tuesday note. 

The analyst said Amarin management had estimated the following timeline:

Filing of reply by Amarin around June 26.

A hearing potentially in September or October. 

An appeal ruling potentially coming by the end of the fourth quarter or early first quarter of 2021. 

"While Hikma recently announced approval of its Vascepa ANDA, for now, we find it unlikely it will pursue an at-risk launch as they would risk treble damages if AMRN wins the appeal," the analyst said.

Stifel said it expects Amarin shares to remain rangebound until later this year.

No Readthrough For Amarin's Other Appeals: U.S. Vascepa patent litigation settlement with Apotex does not provide any readthrough on the strength of Amarin's case in the ongoing appeal vs Hikma and Dr. Reddy's, said SVB Leerink's Fadia. 

The settlement does gives Amarin greater clarity on how generic competition in the U.S. will shape up after an appeals ruling, the analyst said. 

"In our view, today's settlement puts more at stake for Amarin, and reflects management doubling down on the strength of its appeal's case, although we don't disagree with the decision given the risk/reward on the appeal is heavily skewed to the upside.' 

SVB Leerink assigned a 20% of probability of success that Amarin wins the appeal.

Reviewing the appeals brief filed by Hikma and Dr. Reddy's late Tuesday, the analyst said her view on Amarin's likelihood of success is largely unchanged and that she continues to see a tricky path for an Amarin win.

AMRN Price Action: At last check, Amarin shares were rising 0.15% to $6.90

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