Amarin (AMRN) Stock Declines Are A Welcomed Discount

Amarin Corporation AMRN Stock News

Amarin Corporation plc (NASDAQ: AMRN) is tumbling in the market this morning after announcing a surprise advisory committee review for Vascepa. While the surprise means that there will likely be delays in the approval of the expanded indication for the drug, it’s also leading to declines of nearly 20% early on, which are presenting a discount in my opinion. Here’s the scoop:

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AMRN Stock Tumbles On FDA Advisory Committee News

Amarin Corporation’s Vascepa is the center of a sNDA with the FDA asking for a label expansion. The goal is to expand the label to reduce cardiac risk in a patient population that represents a large potential audience.

The PDUFA date for the drug, or the date that the FDA said it would give a response by, is at the end of September. However, due to the news that was released today, chances are that the PDUFA date will be extended.

In a press release issued early this morning, AMRN said that it received notice from the United States Food and Drug Administration stating that the FDA will be holding an advisory committee meeting. This meeting is scheduled for November 14, 2019, about two weeks after the PDUFA date.

In advisory committee meetings, the committee provides the FDA with a vote as to whether or not it believes that the drug should be approved. While the advisory committee has no say with regard to what happens in the end, approval votes by the committee generally lead to approval decisions.

In a statement, John Thero, President and CEO at AMRN, had the following to offer:

We look forward to the planned advisory committee meeting as an opportunity to highlight the landmark REDUCE-IT data and the important role we expect Vascepa should play in the treatment of cardiovascular disease in appropriate patients. We plan to continue to work collaboratively with the FDA on the pending REDUCE-IT sNDA while we prepare for a robust launch of REDUCE-IT data assuming approval of Vascepa before the end of 2019 for a cardiovascular risk reduction indication based on REDUCE-IT.

These Declines Are An Opportunity

In my view, the declines represent an opportunity. Sure, having to wait for the FDA to hold an advisory committee meeting before making a decision is upsetting, but it doesn’t change the facts.

The fact is that AMRN did a great job of showing decreased risk of major cardiac events in a large-scale trial known as REDUCE-IT. At the same time, the American Heart Association recently announced that it no longer recommends once-daily baby aspirin to mitigate risk. This leaves high-risk patients with NO options.

Considering this, there is a large medical need for Vascepa as a treatment to reduce cardiac risk. Considering the strong data, there’s a strong chance that the drug will be approved, quickly taking this market by storm. So, once approved for the new indication, AMRN stock is likely to rocket. Investors simply need to be patient here.

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