Amarin Corporation (AMRN) released a firecracker presentation Saturday at Chicago’s American Heart Association conference and investors can’t seem to stop talking about it. Is it true that all press is good press? The presentation detailed how Vascepa, its cardiovascular drug functions to help those who suffer from moderate hyper triglyceride levels (despite being on statin therapy).
Unfortunately, some of the medical community, as well as investors questioned how effective the medication really is, due to the fact that the company presented data showing when patients took a placebo mineral oil pill, their results were only marginally different.
Jeffries’ Michael Yee, who is bullish on the stock, decided to field questions from both bulls and bears based on the information circulating.
Yee responds to what he calls “the noise” of the bears who are making a case out of the placebo. Yee uses statistics from the conference to support his bullish case – like that 87% of doctors who were at the session said they plan to prescribe Vascepa to all high risk patients and that two cardiologists at the presentation thought the results were so game-changing, they plan to increase utilization of the drug significantly. Vascepa showed a 25% benefit for patients, which proves better than medications for diabetes patients, who only experience 13-14% benefits.
Yee does, however, note the FDA may have questions regarding the validity of the data, given the history of the questions posed about mineral oil from two studies called MARINE and ANCHOR studies.
But the analyst sees only the upside: “Bulls note the overall absolute rate of MACE in placebo was similar with other historical studies so it wasn’t like the event rate was abnormally high and driving the results…regarding the LDL increase in placebo – mgmt noted an analysis was done on the 8-10% LDL increase showing magnitude of effect on MACE was same in those who raised LDL at 1 year vs pbo who declined…so change in LDL had no impact on results….LDL also goes up in many of the CV outcomes studies including for ODYSSEY and even short term studies with Phase III bempodoic acid…and whether the mineral oil interacts w/ statins – mgmt notes the subgroup analysis on low statin patients shows wide error bars, is small n=250, and again, there was no impact when analyzed for pts who increase LDL or not against Vascepa…on many of the KOLs that might be making comments – they may not be completely impartial including one who is leading the competitor trial for Epanova…”
The analyst goes on to defend how the placebo could have been misrepresented. He points out the marker of inflammation “was probably the biggest standout change in placebo” but that the increase in placebo of 30% is hullaballoo and could be an irrelevant outlier. He suggests that since baseline levels are very low to begin with, a 30% change doesn’t alter the risk profile of a patient. Yee believes in the product and he believes in the stock.
“After all the data is digested – Vascepa remains one of the only scarce multibillion dollar potential M&A assets out there and with a market that has significant commercial opportunity across huge patient population…,” Yee asserted.
Cutting through the negativity, this bull moves on ahead. He reiterates a Buy rating for AMRN stock with a price target of $30, which shows an 86% upside from where Amarin currently stands. (To watch Yee’s track record, click here)
It seems that investors are the only ones with fear of the future for this stock. TipRanks reviewed five analysts in the last three months and all are bullish on this stock. With a consensus price target of $34.80, the Street shows an upside of 116%. (See AMRN’s price targets and analyst ratings on TipRanks)