Amarin: Will The Lamb Of Ireland Bleat Or The Lion Of The People Roar?

| About: Amarin Corporation (AMRN)
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Amarin president, John Thero is hinting at mounting a 1st Amendment challenge to the FDA's off-label regulatory laws as a last resort, when he should be exercising free speech now.

I'll show you how the FDA unjustly deprived Amarin of Vascepa expansion into the $40B high triglyceride indication and why everyone should care enough to do something about it.

If Thero acts boldly, Vascepa could reach blockbuster status swiftly - paying for the completion of REDUCE-IT, financing all legal fees and rallying the stock to new heights.

The FDA is counting on Thero's timidity and ignorance to complete the hobbling of the company by denying the ANCHOR appeal and rescinding the REDUCE-IT SPA when the time comes.

Amarin (NASDAQ:AMRN) president and chief executive officer, John Thero has a performance history predicated on poor decision-making. He's been instrumental in bringing the company and perhaps the most important drug ever invented for the preventative treatment of cardiovascular disease to the brink of destruction. And as he now awaits what is sure to be rejection of his final appeal to reinstate the ANCHOR SPA and approve Vascepa for the high triglyceride, mixed dyslipidemia population, Thero often bleats his intention to pursue 1st Amendment relief.

Here' a recent sample from the Goldman Sachs 2014 Global Healthcare Conference from June 12th of this year.

And we believe that if we can get our indication expanded, whether that be through the appeals process with the FDA, whether that be through First Amendment, freedom of speech opportunities, which by the way there was an article in the Pink Sheet this morning where the FDA was speaking of acknowledging that there have been various cases, some with the Supreme Court, some with other high court levels, speaking to the fact that companies should be in positions that if they have factual information that, under freedom of speech, that -- information should be able to be communicated to the public, and the FDA is committed to advancing its guidelines as to what could be allowed there. But that is certainly a backup strategy for us for the appeal.

And here's a slide from the recent Amarin Investor Presentation dated June 3rd.

You should be noticing a trend in these two public conveyances. Thero mistakenly believes he must play the part of the dutiful citizen by petitioning the government for 1st Amendment relief only after he has exhausted all formal paths of appeal within the agency. And while the clock is ticking loudly against Amarin's faithful, this noble gesture is but a cloak of cowardly postponement. Although acting in defiance of regulatory laws governing off-label marketing may invite public censure, it doesn't necessarily mean that a company has, in fact, broken the law. Furthermore, judicial oversight of all remaining agency behaviors would be an indispensable advantage in obtaining Anchor approval through the process of settlement, whether that occurs in the wake of filing a claim or having been filed against.

Before we advance a 1st Amendment investment thesis, here's a pictorial view of Amarin now.

Truthful Off-Label Promotion Is The Foundation Of Amarin's Legal Appeal

The rights of pharmaceutical companies to promote off-label use of their products has been severely curtailed by the Federal Food, Drug and Cosmetic Act, or FDCA, initiated into statute in 1938 and revised as late as 2010. Lately, however, there have been several upper level court decisions pointing towards a change in judicial disposition towards these events.

In a fairly recent example, the Second Circuit Court of Appeals ruled in United States v. Caronia, that the FDCA could not be interpreted to bar truthful, off-label promotion. That decision was controversial, because marketing the drug in question was likely a textbook case of misbranding. Xyrem®, a schedule III narcotic approved by the FDA for the treatment of narcolepsy, was being advanced by an aggressive salesman at the lower tier of his sales force for uses as serious as chronic pain and as benign as insomnia. Nonetheless, the relevance for Amarin is profound.

The whole foundation of authority for the federal government to enforce off-label promotion rests within the FDA's painstaking drug approval process, which requires companies to prove the safety and efficacy of their products by undergoing a series of phase trials designed to scientifically assess benefits and risks. Once satisfied, drugs can then be marketed only to those patient populations specified through the process undertaken, and all package inserts and sales materials must conform to those findings.

Notably, and unlike other companies that might risk being charged with misbranding, Amarin is in a peculiar position to capitalize on off-label promotion in that it has complied with all aspects of the regulatory approval process relative to the patient population it seeks to market to. Vascepa, an already approved triglyceride lowering medication, met all of its primary and secondary endpoints in a study that was approved and agreed upon by the agency in the form of a special protocol assessment designed to expand its use into the off-label realm. Furthermore, the product was acknowledged by the FDA at Amarin's now infamous ANCHOR advisory committee meeting to be both safe and effective. It was rejected at the adcom, pending the results of a prohibitively expensive cardiovascular events study - REDUCE-IT, and later by the agency, ostensibly on the basis of several loosely related outside studies that failed to demonstrate major cardiovascular event risk reduction by other lipid management compounds when added to statin therapy, even though they failed to target high triglyceride patient populations.

Since then, the agency has oddly changed the regulatory approval game by altering its position on serum triglyceride levels in relationship to cardiovascular disease event risk, this despite the fact that the American Association of Clinical Endocrinologists, the American Diabetes Association, the American Heart Association and the National Institutes of Health strongly disagree. That highly questionable decision was made prior to two recent studies involving over 75,000 patients, which offered up the following conclusions relative to patients with genetic predispositions to lower triglyceride levels.

The cumulative incidences of ischemic vascular disease and ischemic heart disease were reduced in heterozygotes as compared with noncarriers of APOC3 mutations (P=0.009 and P=0.05, respectively), with corresponding risk reductions of 41% (hazard ratio, 0.59; 95% CI, 0.41 to 0.86; P=0.007) and 36% (hazard ratio, 0.64; 95% CI, 0.41 to 0.99; P=0.04).

Loss-of-function mutations in APOC3 were associated with low levels of triglycerides and a reduced risk of ischemic cardiovascular disease.

Though the vast majority of Americans, including myself, don't know what their triglyceride levels are, ignorance is the furthest thing from bliss when the result is a cardiovascular event. Here's an outtake from Dr. Gregory S Pokrywka's outstanding video detailing the role of triglycerides in our body systems. I've included his favorite graphic for your consideration.

Cardiometabolic risk is one of my favorite terms of my career of the past ten years. I like it because it links together the most common cause of cardiovascular disease today which is gonna be insulin resistance. If you look at patients being discharged from the emergency room at John's Hopkins, or being discharged from the hospital, who had an acute coronary event or stroke, a high percentage - 75 or 85% are insulin resistant. So there's a big link between insulin resistance and cardiovascular disease, and you can see some of the various phenotypic manifestations of that - high blood pressure, high triglycerides, high LDL-C, low HDL-C etcetera.

I think of it this way, when you get enough visceral adiposity, and if you're genetically predetermined, you get a toxic stew of adipocytokines in the blood stream that cause all these phenotypic manifestations. And certainly we can reverse that metabolic engine by making our patients more insulin sensitive.

Dr. Pokrywka goes on to say this.

I strongly support the use of EPA-only Vascepa as a tool for the reduction of residual lipoprotein risk in my patients on statin therapy with triglycerides above 250 mg/dl. This treatment is safe, improves biomarkers of disease, and is currently being evaluated by a landmark Clinical outcomes trial, REDUCE-IT.

In further hindrance of Amarin's aspirations to enlarge the scope of Vascepa's indications, the FDA has refused to grant New Chemical Entity status, which comes with five years of marketing exclusivity, a move that Amarin has already contested in court. The company's long wait for that designation included yet another policy change by the agency that apparently was applied retroactively to Amarin's application. Delaying expanded product approval while simultaneously narrowing the window for generic competition is a double whammy, especially given the strange shutting of the door to the clinical necessity of triglyceride lowering held only by the FDA in defiance of the entire medical community.

Each of these events by themselves might be arguably inconclusive, but together, they form the basis of a fairly convincing case of institutional bias against the company augmenting a potent 1st Amendment defense to any prospective misbranding charge. Were Amarin to change Vascepa's label now to include the mixed dyslipidemia population and detail its sales force to market the drug to this expanded population, it would surely reflect the truth of Vascepa's scientifically confirmed results and a conviction of legal rectitude.

From my perspective, the benefits to patients, the company and its shareholders would far outweigh the risks inherent in any other course of action. But before we form an investment thesis predicated upon this tantalizing free speech appeal, let's take a look back to see how we got here.

Justice Delayed Is Justice Denied

The FDA's decision to delay ANCHOR approval was likely part political in nature. John Thero was his own worst enemy, being tone deaf to the politics of the day and to the powerful interests he unknowingly upset. While the studies alluded to by the agency during the adcom may have been significant drivers of the ultimate result, the following unspoken factors may have come into play:

  • While the current executive administration, of which the FDA is a part, struggled with rising budget deficits and dwindling tax revenues, John Thero bragged at every public opportunity afforded him that Amarin was headquartered offshore in Ireland with tax advantages unavailable to state-side businesses. This investment inducing emphasis on frugality had a secondary effect of causing one adcom panelist to wonder aloud whether or not Amarin wouldn't cease the expensive REDUCE-IT study upon granting of ANCHOR approval in order to accomplish two goals - not having to suffer a negative trial outcome and not having to foot the bill.
  • GlaxoSmithKline (NYSE:GSK) has powerful, long-lasting connections within the agency that John Thero may have unwittingly upset just two months prior to the adcom at the Canaccord Genuity 33rd Annual Growth Conference. At that meeting, Thero stated that he would contact insurance payers to make sure that off-label reimbursement for GSK's Lovaza in the high triglyceride population specified by the ANCHOR indication would not continue. At that time, Lovaza was bringing GSK nearly $1B in annual revenue, despite having failed to be approved for the mixed dyslipidemia population because of the presence of DHA in the formula which raises bad cholesterol.

The end result of these faux pas was an agency presentation at the adcom that appeared biased even to the casual observer. The vote of committee members against ANCHOR approval until such time as the results of REDUCE-IT are made available was 9-2; this despite the fact that 50% enrollment was the only requirement of the then-sacrosanct SPA agreement.

Subsequently, the ANCHOR SPA was rescinded and an appeal to restore it denied. A final plea is now under review at the policy level of the agency, with a decision forthcoming in early August by John Jenkins, director of the Office of New Drugs at the Center for Drug Evaluation and Research. In this video that I recommend every biotechnology investor view, Jenkins suggests an approval process that runs counter to what Amarin experienced at the adcom, especially given that Vascepa was an already approved product with no safety signals that met all primary and secondary endpoints of its FDA co-authored trial.

It's very important for people to understand that we don't know everything about new drugs at the time we approve them, that's kind of built into the system, because if we waited until we knew everything you could possibly know, then the wait would be too long and patients would be denied access to important new treatments.

I can think of no other more important treatment than one which has been proven to lower biomarkers of cardiovascular disease risk and simultaneously has no adverse effects to speak of. The following slide represents Vascepa's performance in this larger high triglyceride population of patients.

Following the adcom decision, several panel members verbalized disappointment that such a small start-up as Amarin had been placed in a position of having to fund the prohibitively expensive cardiovascular outcomes trial to completion without the implied financial support of sales revenue promised by the SPA agreement. Such expressions of solace were of little comfort to shareholders, who have suffered grave material loss, and to the company, which was denied the required financial support necessary to complete the trial. This further justifies the approach of changing the label now to conform to the truth of the matter. Utilizing accrued revenues for the purpose of financing REDUCE-IT to completion will allow the courts to look favorably upon the necessity of having done so.

This Is The Fight That The FDA Does Not Want

Quite frankly, I'm not surprised that Mr. Thero doesn't understand his constitutional rights, because he certainly hasn't acted the part of a patriot by doing the lion's share of his business within the United States of America, while lightening the company's tax burden by headquartering overseas. The irony of his present situation amuses me, but the anger over the unfair treatment of Amarin shareholders throughout this process supersedes any entertainment value.

It's widely held that in United States v. Caronia, the FDA didn't appeal the outcome because they feared Supreme Court involvement might have resulted in the neutering of agency powers. Therefore, petitioning the courts for judicial relief ought to be done without delay. Even better would be to change the label now to include the mixed dyslipidemia population, detail the sales force to market Vascepa accordingly, and let the chips fall where they may.

Being sued engenders the sympathy of the court, and this transference of emotional predisposition is one that Amarin should avoid at all cost. Sometimes, it's better to play the role of the Dark Knight than that of the beggar, because being labeled a law breaker doesn't necessarily make it so, as evidenced by the constitutional imperative: innocent until proven guilty. Oddly, this Batman quote from Dark Knight sums it up beautifully where Amarin shareholders are concerned.

That's what needs to happen because sometimes truth isn't good enough. Sometimes, people deserve more. Sometimes people deserve to have their faith rewarded.

Typical to his propensity for error, John Thero has telegraphed his intentions to pursue 1st Amendment relief, and therefore, narrowed the window of benefits available were he to have simply acted instead. Regardless, the advantages are still palpable.

  1. In a market conservatively deemed to be ten times larger than the Marine indication, Anchor would offer a chance to increase sales revenues ten-fold, which could then be used to retire debt, complete the REDUCE-IT study and pay for legal fees.
  2. By placing the onus for legal action on the FDA, Amarin at once augments the vilification of the agency and narrows the focus exclusively to the rightness or wrongness of the label itself. The FDA will likely avoid seeking to remove the product from the market, because they already know they are absent just cause for doing so, there being no evidence of imminent harm. Rather, they would seek an injunction specifically to return the label to the previous severe hypertriglyceridemia population and fine Amarin accordingly. This would then restrict arguments to the truthfulness of the agency's position, a focused fight which I believe would benefit Amarin immensely.
  3. The FDA might choose wisely to do nothing at all. The problem with pursuing legal action against Amarin is that it opens the door to a fight that might well end with a high court ruling that the entire FDA approval process is unconstitutional. One 1st Amendment criticism the courts have proffered is that free speech is weighted unfairly in favor of doctors and agency representatives at the expense of pharmaceutical companies.

To Illustrate This Point, I Submit For Your Consideration The ANCHOR Adcom

Let's take a look now at what was presented and what was not. Please keep in mind that agency leadership recognized that Vascepa was approved as a commercial treatment for severe hypertriglyceridemia, as defined by patients with triglycerides in excess of 500 miligrams per deciliter. While not verbalizing a cardiovascular benefit, the agency did admit that triglycerides at that level led to acute pancreatitis, which ought to be avoided.

The FDA also admitted that Vascepa had met all the agreed upon biomarker reduction benefits and had no significant safety issues to speak of. What the agency presented were several studies that paired other biomarker-reducing compounds with statin therapy, which were unable to demonstrate a major cardiovascular risk reduction benefit.

It is important to note that the agency informed Amarin at the time of the Anchor SPA agreement that these studies, most notably AIM-HIGH, ACCORD-LIPID and HPS2-THRIVE, would provide important information on adding a lipid reducing treatment to widely recognized and proven beneficial statin therapy. However, the only requirement that the agency made of Amarin at the time was that the REDUCE-IT trial be underway and 50% enrolled.

At the adcom, Mary Roberts, FDA Division of Metabolism and Endocrinology clinical reviewer, stated the following about the relevance of these studies relative to ANCHOR approval:

The critical question which patients care about is ultimately, do the observed changes in lipids and lipoproteins with Vascepa, while treated with statins, translate into a benefit on cardiovascular outcomes?

Keep in mind now, that this wasn't established as requisite during the special protocol assessment discussion, and clearly represents a unilateral change in the agreement with a concomitant raising of the approval bar. Mary Roberts continues:

This question is not new, but now we have more data informing this debate. This morning, you've heard the sponsor site several associations between triglyceride or non-HDL and cardiovascular outcomes. In general, we agree that several studies suggest an association between these lipid parameters and outcomes. Such associations, however, are but one piece of the story.

Now, I don't know about you, but it seems to me that's the only piece relevant to the issue at hand, as Vascepa is targeted to those biomarkers and for that purpose. Mary Roberts then goes on to say this:

There have been multiple instances when a drug has had no effect or even adverse effects on clinical outcomes despite beneficial effects on biomarkers that have been strongly associated with clinical events. To this end, we believe that recent clinical trials inform the discussion.

Ms. Roberts went on to address each of those loosely related studies. ACCORD-LIPID involved adding fenofibrate to open label statin therapy in diabetic patients at high risk for cardiovascular events, and failed to show treatment benefit on cardiovascular outcomes over simvastatin monotherapy. Bear in mind that though triglyceride lowering was a targeted study outcome, there was, in fact, no lower limit screening of triglyceride levels to qualify for study participation. Therefore, the median baseline level of triglycerides across the entire treatment population was 162mg/dl. What relevance does that have on the efficacy of Vascepa to treat patients with triglycerides of between 200mg/dl and 499mg/dl? Furthermore, what would attaining or not attaining the primary endpoint be, if high triglycerides are not factored into the equation?

In 2011, the results of AIM-HIGH were published. This trial involved adding extended release niacin to statin therapy for people at high risk of cardiovascular events. Sadly, no benefit was observed, and many patients experienced unpleasant side-effects. However, once again, the triglyceride levels of these patients were too low to be relevant and the study objective had nothing to do with lowering this biomarker.

It should be noted that these trials were large and took place over years rather than the short 12-week duration of ANCHOR, but are on par with the size - 8,000 patients, and timeline - 5 years, of REDUCE-IT.

In 2012, HPS-2 THRIVE study results showed no cardiovascular event reduction benefit in adding niacin, this time with an anti-flushing agent - laropiprant, to statin therapy. Again, baseline triglyceride levels in study participants were woefully low - 125mg/dl. And the agency never asked panelists to consider what effects adding a third compound to treatment might have on study outcomes in the active arm. Also note that at the time of this adcom, the HPS-2 THRIVE results hadn't yet been published in a peer-reviewed journal or presented to the FDA for consideration. The agency was basing its opinion on public records like the article you're reading now.

Here's Mary Roberts summarizing the implications attending to these trials.

We acknowledge that all studies, including these highlighted, have limitations. However, to date there is no conclusive evidence that additional modifications of non-LDL lipid and lipoproteins translate into further cardiovascular benefit in the setting of optimized statin therapy and LDL control in the overall population studied.

We are aware of analyses of certain patient subgroups defined by baseline triglycerides and HDL level thresholds in ACCORD-LIPID and AIM-HIGH which have suggested a possible treatment benefit with add-on therapy with statins. However, these positive subgroup results in an overall negative trial should be interpreted with caution. The division considers these results to be hypothesis generating and have not been confirmed in prospective, randomized, placebo controlled trials with cardiovascular event endpoints.

Note, too, that the agency failed to present any of these relevant subgroup statistics to the panel, simply mentioning them as an afterthought and then dismissing their importance as merely "hypothesis generating" and unconfirmed. It's also odd that the lack of randomization and placebo control was emphasized here but dismissed elsewhere.

Furthermore, though these studies were large and long of duration, none of them tested pure EPA fish oil in conjunction with statin therapy for the sole purpose of demonstrating a major adverse cardiovascular event risk reduction. So, how relevant could they possibly be? There was, however, one study that did just that.


The one large, randomized trial that was clearly relevant to the issue of treating patients with pure EPA fish oil that focused on cardiovascular event outcomes was Jelis. And while the agency acknowledged the significant benefit of an overall reduction of major adverse cardiovascular events across the entire treatment spectrum of 19%, they failed to mention this.

That's right! An extremely large subgroup of over 5,000 patients with high triglycerides and low HDL-C had a 53% reduction in the very events that the agency says are the only endpoints that matter. 53%! They were quick, however, to point out that all trial participants were Japanese, the majority of whom were women, and that the daily dose of statin was unusually low, perhaps causing the control arm to underperform. Of course, the daily dose of EPA in the active arm was less than half that of the recommended 4gm dose of Vascepa.

Mineral Oil On Hold

The FDA was in no position to argue that the Anchor results were compromised by a non-inert placebo in control. They authorized it! That said, there were unusual elevations in biomarkers across the control group, indicating that mineral oil was likely an active agent with a negating effect on statin. However, even if you account for this irregularity by moving these parameters to null, Vascepa still would have performed at a statistically significant level in reducing triglyceride levels.

The agency, however, pounded away at this issue to accomplish one very important long-term objective.

Amarin's Aspirations To Market To The Mixed Dyslipidemia Population Will Be Thwarted Entirely When The REDUCE-IT SPA Is Rescinded

Here's Mary Roberts in session 2.

The figure shows that with the exception of HDL, changes observed within the placebo group went in an adverse direction from baseline to week 12. The direction and magnitude of these changes in the placebo group were unexpected given the study design which incorporated a substantial lead-in period of dietary instruction and statin stabilization prior to randomization.

As a reminder, the placebo group received two milliliters of mineral oil twice a day. The division recognizes that in placebo controlled trials it is the between group differences that are assumed to estimate the treatment effects. This assumes, however, that the placebo is inert and no other factor is differentially affecting the placebo group versus the active group which could affect the outcome.

In the case of ANCHOR, however, the changes observed within the placebo group stood out as atypical for similarly designed, lipid lowering trials that we have reviewed which gave us pause, especially since the changes went in an unfavorable direction. Thus the review team sought evidence that might help explain the changes observed in the mineral oil group.

We considered issues with randomization, unblinding, statin absorption, study design elements and lipid changes observed in placebo treated patients. Our review did not point to any particular cause for the observed placebo changes. Therefore, what if any implications do the placebo group changes have on the REDUCE-IT and ANCHOR trials?

For REDUCE-IT our primary concern was whether or not there was a possibility that the mineral oil could attenuate the effect of a statin, perhaps by inhibiting absorption. If plausible, this would raise concerns about the potential impact this would have on the ongoing cardiovascular outcomes trial which is also using mineral oil as placebo amongst statin treated patients. Because we don't have any hard evidence for an interaction, such as a formal drug-drug interaction study, we discussed our concern with the sponsor and asked that they task their REDUCE-IT data monitoring committee with evaluating the accruing lipid data with this concern in mind.

What implications are there, if any, for that ANCHOR trial? There could be none. If one believes that all elements effecting outcomes in the ANCHOR trial were equally distributed between the placebo and active groups, then the between group comparisons represent the best estimate of the treatment effect shown in the far right column of this table [slide not provided].

Alternatively, if one believes that the changes within the placebo group could be the result of some factor that is not also present in the active group then the treatment effect of Vascepa might be overestimated.

Please allow me to translate that for you. Mineral oil's non-inert performance in ANCHOR will be the relevant point of reference for verification of mineral oil's non-inert performance in REDUCE-IT. Consequently, REDUCE-IT results will be judged unreliable, and therefore, not actionable except, of course, to reject them.

So, how then would a public outcry be quelled in that eventuality? Well, the FDA sent Amarin an updated policy note, along with their SPA rescission which was reported in a corporate Form 8-K dated October 29th, 2013, which states the following:

Thus, the FDA stated that it no longer considers a change in serum triglyceride levels as sufficient to establish the effectiveness of a drug intended to reduce cardiovascular risk in subjects with serum triglyceride levels below 500mg/dl.

And that, my friends, is that.

So, what we're left with then is a drug that works to lower triglycerides proven to cause strokes and heart attacks, with no measurable side-effects or safety issues that was rejected on the basis of a group of three loosely related studies that had nothing to do with treating patients with high triglycerides between 200mg/dl and 499mg/dl, and didn't use 96% pure EPA fish oil.

What follows is a short video outtake of the ANCHOR adcom, composed of three parts. The first is a grammatical misstep that may or may not reveal subconscious intent. The last is a reminder to everyone that Vascepa's future in the mixed dyslipidemia population will be decided not at a REDUCE-IT adcom, but behind closed doors. And in between is an abbreviated conversation shared by panelist Dr. William Hyatt and FDA representative Dr. Eric Coleman in adcom session 4 that crystallizes the constitutional question to come.

Dr. Hyatt:

Absent that new data, do the agreements that you've made essentially commit you to say, you have a positive ANCHOR trial, you're 50% enrolled in a cardiovascular outcome trial, and we agreed that if you did the lipid things that you said you'd do in ANCHOR and the outcomes trial was 50% recruited, that we would grant you a change in your label? Is that, was that, the agreement?

Dr Coleman:

Yeah. I mean if, for example if ACCORD-LIPID and AIM-HIGH and THRIVE were all positive, I'd think we'd have a very different discussion going.

I just wanted you to know what he did acknowledge, because it's the best defense against a misbranding charge that one could possibly imagine.

The Optimal Outcome Of 1st Amendment Action - Settlement

I want to emphasize, before concluding, that though I favor Amarin's position with respect to Vascepa approval in the high triglyceride patient population and also favor 1st Amendment action to achieve that end, I believe there's room for both parties to arrive at an equitable settlement of their legitimate concerns.

As I see it, the FDA has a very real interest in seeing the REDUCE-IT study brought to completion as planned. I also believe that the agency has a legitimate concern that Amarin not be allowed to declare a cardiovascular risk reduction benefit where none has been proven.

Therefore, I believe that the agency would be amenable to granting a label change of expansion into the mixed dyslipidemia population contingent upon Amarin's pledge to complete the REDUCE-IT trial and not declare CVD event reduction until proven.

A Curious Discovery

I have two anecdotal thoughts to share. The first involves a misunderstanding I had about Vascepa that is likely shared by many. I believed the product to be a relatively costly therapy that could be avoided by using over the counter supplements. While I did find some very nicely EPA weighted formulas, none were 96% pure EPA and none would cost $9 per monthly treatment. The one that I did find would require me to purchase 6 bottles at $29.95 each to get the same medicinal benefit if I were also willing to swallow 1 gm of cholesterol raising DHA daily in the process.

Note, too, that 100M Americans are now eligible to receive Vascepa on tier 2 coverage, and Amarin is providing help to those who are put off by higher copays.

The other more interesting thought from an investment perspective was discovered by visiting the Kowa website.

I wasn't surprised to see that Kowa was actively involved in the selling of cardiovascular care therapies, as they've entered into an agreement that pays them a percentage of gross sales without providing any upfront remuneration. I therefore concluded that they must be adding Vascepa to a sales bag already destined for the offices of heart doctors.

What did surprise me though was to learn that both of their products, Livalo - a statin therapy, and Lipofen, were remedies targeted to the expanded mixed dyslipidemia population that Vascepa seeks to enter into. Perhaps Mr. Thero is cagier than I thought him to be.

Some Closing Thoughts

There are many people bravely standing up to say that something is wrong with this picture, both large and small. On a macro level, one can't ignore the fact that three-quarters of the 600k yearly heart attacks in the U.S. occur in the absence of elevated cholesterol levels, which is the sole target of statin therapy. I'm also obligated of conscience to note that Vascepa is a disruptive treatment which, if made available on a wide-scale basis, might substantially reduce the number of persons with not only heart disease but diabetes as well. Just how much of an impact on the $45B we annually spend on these remedies would be lost to Big Pharma is unknown, but the leaders of those interests had to be concerned. Was it at all surprising then that the industry representative on the ANCHOR adcom panel was Mads Rasmussen of Novo Nordisk, the world's largest supplier of insulin to some 24.3M diabetic patients worldwide?

And on a micro level, I feel compelled to do something to right what I perceive to be a considerable wrong. Though I lost no money by vacating my position in Amarin weeks before the adcom occurred, I remain dumbfounded, saddened and even angered by the outcome. This article, I suppose, is my way of making amends, and though righteous indignation doesn't necessarily make for a sound investment thesis, I re-initiated a position in Amarin on July 3rd of this year, and have added to it since.

Anticipation of Thero acting is an expectancy which, I believe, will drive the stock price higher in the coming months, even if Thero remains unwilling to do so. Should the bleats of redress quietly fade away or die altogether, Amarin still represents a decent buy-and-hold biotech, as the severe triglyceridemia market is estimated at $4B and remains woefully untapped, despite Lovaza's blockbuster status.

Should, however, Mr. Thero find his true voice and become the lion of the people through acts of defiance or redress, Amarin shares will undoubtedly have that Independence Day fireworks glow about them.

Always be well...

Disclosure: The author is long AMRN. The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it (other than from Seeking Alpha). The author has no business relationship with any company whose stock is mentioned in this article.

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