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Amarin Corporation (AMRN) Down 13% in One Week: Here's Why
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In the past week, the share price of Amarin Corporation (AMRN - Free Report) was down 12.9% compared with the industry’s 0.5% fall.
Image Source: Zacks Investment Research
The primary reason for the decline is the ongoing tussle of the company with its largest shareholder, Sarissa Capital Management LP ("Sarissa").
Earlier this month, Sarissa submitted a notice to Amarin to call a special meeting of the company’s shareholders. The former seeks to add seven directors to the company’s board and remove the current chairman, Per Wold-Olsen, from the board. This step was taken by Sarissa as it believes that the company’s board refreshment process was a “charade” and that the board has rejected attempts to add any shareholder representatives to the board.
However, Amarin’s management has defended itself against the above statements stating that the company has actively engaged with Sarissa since the firm's equity stake became public knowledge in November 2021. It also defended its board refreshment process by highlighting the new strategic directions, including a cost-reduction program and other cash preservation initiatives.
This dispute escalated last week when Sarissa renewed its criticisms on Amarin’s board and further accused management of causing a significant loss in shareholders’ wealth. Sarissa also accused the company of lagging behind its strategic targets, including its slow response to the U.S. launch of Amarin’s sole marketed drug Vascepa’s generics.
Subsequently, Amarin responded to the above critiques by calling Sarissa’s statements as “inaccurate and misleading”. The management also stated that Sarissa’s intervention would disrupt the company’s future value.
Amarin has also stated that it has filed a preliminary proxy statement with the SEC with regard to the special meeting requisitioned by Sarissa and the date of this meeting will be announced shortly.
Nearly all of the Amarin’s revenues are come from the product sales of its sole marketed drug, Vascepa(icosapent ethyl). Vascepa was initially approved by the FDA in 2012 as an adjunct to diet for treating severe hypertriglyceridemia or elevated triglyceride (TG) levels. Vascepa was subsequently approved in the United States in 2019 to reduce cardiovascular risk (CV) in patients with persistently elevated triglycerides on statin therapy for LDL-C.
Amarin lost patent protection for Vascepa in hypertriglyceridemia indication in 2021. Since then, the drug has been facing generic competition in the United States. The company is currently pursuing commercialization for the drug in the CV indication and aims to establish itself as a diversified cardiometabolic player.
Amarin’s growth is solely dependent on the prospects of Vascepa. Although the company is looking to expand in other countries, generic competition for Vascepa’s hypertriglyceridemia indication in the United States is rising. Currently, four generic versions of Vascepa are available in the country. Any potential launch of new Vascepa generics will worsen the scenario further. A potential failure of Amarin to create sufficient awareness for Vascepa’s CV risk reduction indication may induce further erosion of the drug’s sales going forward, which is a major concern.
Last year in June, Amarin implemented a comprehensive cost and organizational restructuring plan addressing the rising generic competition for Vazkepa in the United States. In third-quarter 2022, the company started to witness the benefits of the restructuring program. Amarin expects to reduce its total operational expenditure over the next 12 months by approximately $100 million. This will enable Amarin to maintain a positive contribution margin in the United States while continuing to invest in its imminent European market launches and global expansion.
Amarin currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the overall healthcare sector include ADC Therapeutics (ADCT - Free Report) , Arcus Biosciences (RCUS - Free Report) and Eton Pharmaceuticals (ETON - Free Report) . While Arcus Biosciences and Eton Pharmaceuticals sport a Zacks Rank #1 (Strong Buy) at present, ADC Therapeutics carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
In the past 30 days, estimates for Arcus Biosciences’ 2023 loss per share have narrowed from $4.75 to $4.57. Shares of RCUS have declined 33.0% in the past year.
Earnings of Arcus Biosciences beat estimates in two of the last four quarters, missed on one occasion and met the estimates on another, witnessing an earnings surprise of 56.74%, on average. In the last reported quarter, Arcus Biosciences’ earnings beat estimates by 14.29%.
In the past 30 days, estimates for Eton Pharmaceuticals’ 2022 loss per share have narrowed from 44 cents to 38 cents. During the same period, the earnings estimates per share for 2023 have risen from 1 cent to 6 cents. Shares of ETON have fallen by 0.3% in the past year.
Earnings of Eton Pharmaceuticals missed estimates in three of the last four quarters while beating the mark on one occasion, witnessing a negative earnings surprise of 115.63%, on average. In the last reported quarter, Eton Pharmaceuticals’ earnings beat estimates by 20.00%.
In the past 30 days, estimates for ADC Therapeutics’ 2022 loss per share have narrowed from $2.14 to $2.05. During the same period, the loss estimates per share for 2023 have narrowed from $2.71 to $2.68. Shares of ADCT have declined 5.2% in the past year.
Earnings of ADC Therapeutics beat estimates in three of the last four quarters while missing the mark on one occasion, witnessing an earnings surprise of 26.08%, on average. In the last reported quarter, ADC Therapeutics’ earnings beat estimates by 27.45%.
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Amarin Corporation (AMRN) Down 13% in One Week: Here's Why
In the past week, the share price of Amarin Corporation (AMRN - Free Report) was down 12.9% compared with the industry’s 0.5% fall.
Image Source: Zacks Investment Research
The primary reason for the decline is the ongoing tussle of the company with its largest shareholder, Sarissa Capital Management LP ("Sarissa").
Earlier this month, Sarissa submitted a notice to Amarin to call a special meeting of the company’s shareholders. The former seeks to add seven directors to the company’s board and remove the current chairman, Per Wold-Olsen, from the board. This step was taken by Sarissa as it believes that the company’s board refreshment process was a “charade” and that the board has rejected attempts to add any shareholder representatives to the board.
However, Amarin’s management has defended itself against the above statements stating that the company has actively engaged with Sarissa since the firm's equity stake became public knowledge in November 2021. It also defended its board refreshment process by highlighting the new strategic directions, including a cost-reduction program and other cash preservation initiatives.
This dispute escalated last week when Sarissa renewed its criticisms on Amarin’s board and further accused management of causing a significant loss in shareholders’ wealth. Sarissa also accused the company of lagging behind its strategic targets, including its slow response to the U.S. launch of Amarin’s sole marketed drug Vascepa’s generics.
Subsequently, Amarin responded to the above critiques by calling Sarissa’s statements as “inaccurate and misleading”. The management also stated that Sarissa’s intervention would disrupt the company’s future value.
Amarin has also stated that it has filed a preliminary proxy statement with the SEC with regard to the special meeting requisitioned by Sarissa and the date of this meeting will be announced shortly.
Nearly all of the Amarin’s revenues are come from the product sales of its sole marketed drug, Vascepa(icosapent ethyl). Vascepa was initially approved by the FDA in 2012 as an adjunct to diet for treating severe hypertriglyceridemia or elevated triglyceride (TG) levels. Vascepa was subsequently approved in the United States in 2019 to reduce cardiovascular risk (CV) in patients with persistently elevated triglycerides on statin therapy for LDL-C.
Amarin lost patent protection for Vascepa in hypertriglyceridemia indication in 2021. Since then, the drug has been facing generic competition in the United States. The company is currently pursuing commercialization for the drug in the CV indication and aims to establish itself as a diversified cardiometabolic player.
Amarin’s growth is solely dependent on the prospects of Vascepa. Although the company is looking to expand in other countries, generic competition for Vascepa’s hypertriglyceridemia indication in the United States is rising. Currently, four generic versions of Vascepa are available in the country. Any potential launch of new Vascepa generics will worsen the scenario further. A potential failure of Amarin to create sufficient awareness for Vascepa’s CV risk reduction indication may induce further erosion of the drug’s sales going forward, which is a major concern.
Last year in June, Amarin implemented a comprehensive cost and organizational restructuring plan addressing the rising generic competition for Vazkepa in the United States. In third-quarter 2022, the company started to witness the benefits of the restructuring program. Amarin expects to reduce its total operational expenditure over the next 12 months by approximately $100 million. This will enable Amarin to maintain a positive contribution margin in the United States while continuing to invest in its imminent European market launches and global expansion.
Amarin Corporation PLC Price
Amarin Corporation PLC price | Amarin Corporation PLC Quote
Zacks Rank & Stock to Consider
Amarin currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the overall healthcare sector include ADC Therapeutics (ADCT - Free Report) , Arcus Biosciences (RCUS - Free Report) and Eton Pharmaceuticals (ETON - Free Report) . While Arcus Biosciences and Eton Pharmaceuticals sport a Zacks Rank #1 (Strong Buy) at present, ADC Therapeutics carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
In the past 30 days, estimates for Arcus Biosciences’ 2023 loss per share have narrowed from $4.75 to $4.57. Shares of RCUS have declined 33.0% in the past year.
Earnings of Arcus Biosciences beat estimates in two of the last four quarters, missed on one occasion and met the estimates on another, witnessing an earnings surprise of 56.74%, on average. In the last reported quarter, Arcus Biosciences’ earnings beat estimates by 14.29%.
In the past 30 days, estimates for Eton Pharmaceuticals’ 2022 loss per share have narrowed from 44 cents to 38 cents. During the same period, the earnings estimates per share for 2023 have risen from 1 cent to 6 cents. Shares of ETON have fallen by 0.3% in the past year.
Earnings of Eton Pharmaceuticals missed estimates in three of the last four quarters while beating the mark on one occasion, witnessing a negative earnings surprise of 115.63%, on average. In the last reported quarter, Eton Pharmaceuticals’ earnings beat estimates by 20.00%.
In the past 30 days, estimates for ADC Therapeutics’ 2022 loss per share have narrowed from $2.14 to $2.05. During the same period, the loss estimates per share for 2023 have narrowed from $2.71 to $2.68. Shares of ADCT have declined 5.2% in the past year.
Earnings of ADC Therapeutics beat estimates in three of the last four quarters while missing the mark on one occasion, witnessing an earnings surprise of 26.08%, on average. In the last reported quarter, ADC Therapeutics’ earnings beat estimates by 27.45%.