How Big Could Amarin's Vascepa Be?

Amarin (AMRN -2.11%) recently reported data from a long-running study of its fish oil pill, Vascepa, that could reshape how cardiologists treat their patients.

In today's clip from The Motley Fool's Industry Focus: Healthcare, host Shannon Jones and Motley Fool contributor Todd Campbell discuss how Vascepa can reduce the risk of major cardiovascular events, and why the study's results may turn Vascepa into a billion-dollar blockbuster.

A full transcript follows the video.

This video was recorded on Sept. 26, 2018.

Shannon Jones: Todd, I don't know about you, but for me, September has been a wild and very interesting month for the biopharma world.

Todd Campbell: Oh, absolutely! The Amarin Vascepa data that we just got has to rank in the top five, at least, of crazy things that we've seen in biopharma this month, if not higher.

Jones: Yeah, I definitely would say it has to be within the top five. I would dare say it's maybe No. 2 or No. 3, even, given the anticipation leading up to the trial, everything that's happened prior to the trial, and what the results showed. We'll get into all of that.

But first, Todd, I know you and Kristine did an awesome background leading up to this cardiovascular outcome study. That was the first Wednesday in September. I'd really encourage our listeners to go back, listen to that episode. They did an awesome job setting the stage of this binary event for Amarin. But let's give a very brief background to our listeners that are catching up, let's just tell them why this trial was so, so important for Amarin.

Campbell: Amarin markets a drug called Vascepa. Vascepa is a purified omega three fatty acid. We'll call it EPA. It's been on the market since 2012 for use in reducing triglycerides, fat in the blood, in patients that have very high triglyceride readings, greater than 500 milligrams per deciliter. The approval in the very high population, however, only scratches the surface of the addressable market. There are literally tens of millions of patients that have elevated triglyceride levels.

Amarin had conducted a trial to see whether or not patients with moderate triglyceride levels -- 152-500 -- would benefit from Vascepa. Sure enough, their triglyceride levels fell in that trial. But the FDA said, "We're not going to approve its use in that moderate patient population because frankly, no one has proven that lowering triglycerides," again, fat in the bloodstream, "actually translates into saving people's lives, reducing the risk of major cardiovascular events like stroke and heart attack and, yes, death." About 800,000 people die every year from cardiovascular events.

Amarin, recognizing that the big money was to be made in being able to roll this drug out to a much bigger, broader population, began conducting a study to tie and make that link that yes, if you take Vascepa, it will lower triglycerides. And yes, if it lowers triglycerides, that will indeed save people's lives and prevent heart attack and stroke.

Seven years in the making, the study has finally read out results. And sure enough, Shannon, it was, I would say, as good as they could have hoped for.

Jones: Yeah, and really even better. I think it's safe to say too, expectations leading up to this trial, while everyone was anxious to see exactly what the readout would be, the expectations were relatively low, given the multiple study failures when it comes to cardiovascular outcome studies. The most recent one was the Ascend study, which effectively found that generic fish oils -- granted, relatively low dose compared to Vascepa in this study -- weren't effective in the prevention of these cardiovascular events.

Of course, Amarin was very quick to come out and counter the results of that study, reiterating and reemphasizing the purity of Vascepa. As you talked about with EPA, not a mixture of all these other types of fatty acids.

Campbell: Right, DHA elevating bad cholesterol levels is thought to have been why the supplements failed. Those supplements also included DHA alongside EPA. That's not the case with Vascepa. It is pure EPA.

Jones: Yes. Amarin been really driving that point home. Leading up to the study, it's really been on the top of everyone's mind looking to see if, indeed, that makes a difference. Just like you said, it sounds like it did. Let's dive right in. What it exactly did Amarin find in this particular trial?

Campbell: They enrolled patients that had bad cholesterol levels that were controlled by statins. We're talking patients who take statins, which are the most commonly prescribed drugs in the world. I think 38 million Americans alone take statins every day for their high bad cholesterol. They enrolled patients that were on cholesterol-controlling medications, but still had high triglyceride levels.

What they found is that taking four grams per day of Vascepa translated into an additional 25% reduction in the risk of a major cardiovascular event, including stroke, heart attack, and death. 25%. That, Shannon, is on top of the 25% reduction in risk that's historically been associated with taking statins. So, a really remarkable finding.

Jones: Absolutely, yes. Honestly, I think Wall Street and the scientific community would have been fine with a 15% reduction in risk. To see 25% really wowed everybody. We'll get more detailed data moving forward. We've got the American Heart Association meeting happening November the 10th.

Specifically for me, I'm really curious to dig into the slicing and dicing of the data a little bit more. What you see with a lot of these cardiovascular outcomes studies are these composite endpoints. The endpoints basically, as you mentioned, Todd, they're looking at a number of different events. You talked about stroke, heart attack, death, even. They combine all of those endpoints into one, and that's really what they reported out on this week. What we'll see coming into November is more detail into that.

I'm also curious to see which patient groups responded better than others. Also, I mean, with so much focus being on triglyceride levels, I'm really curious to see just how much Vascepa was able to lower those levels, too. Those are the things that are in the top of my mind heading into that meeting.

Campbell: The big question that every investor is going to have is, how big could this drug get? They did $180 million in sales last year, I think they were targeting $230 million for this year already. That's just on the severe high triglyceride approval way back in 2012. I think that totally undersells it, now that this data is out. I would not be surprised if cardiologists are going to be talking to their patients about this drug very, very soon. It is, again, potentially a life-saving drug.

Now, I happen to have family members who have a history of stroke. My father, for example, is on statins and other drugs to try and rein in that risk. He had told me in the past that he was on fish oil pills. So, when I saw this data, I called him up and I said, "Hey, did you see this great data?" He goes, "Oh, yeah, I stopped taking my fish oil pills because of that failed study of the over the counter supplements." It wouldn't be shocking to me, if my dad's cardiologist, a lot of people's cardiologists, started having conversations with them about Vascepa. Again, 25% relative risk reduction on top of the statins is pretty remarkable.

This is a massive addressable market. Amarin estimates that over 50 million adults in the United States have triglyceride level readings that are above 150 milligrams per deciliter. Obviously they won't get that big, but is there the potential for this to be a billion-dollar blockbuster drug? I think there is now.

Jones: Absolutely. I've heard the terms being thrown around as a true game changer, paradigm shift in how we treat patients. I really think, to your point, you will start to see the uptake in prescribing habits when it comes to Vascepa. Amarin is actually aiming to file the supplemental MD&A by early 2019. Anticipated approval within this specific indication coming by late 2019. I fully anticipate you'll see a bump up in sales even before that.

Another interesting thing, too, there's not really an immediate direct competitor for Amarin in this space right now. The closest one is actually AstraZeneca. They've got right now a strength trial. They're also looking at a 4 gr daily dose of their drug. It's interesting, though, because for AstraZeneca, their drug is one of those mixed omega three fatty acids. I believe it's called Epanova. That will be reading out in 2019. I think it will be a really interesting read out, to see what we can extract from that study, are there any read throughs when it comes to dosing level. It's just going to be an exciting 2019, to say the least.

Campbell: [laughs] Yeah, very much so! We're definitely going to watch those prescription trends over the course the next few quarters for this company. It's also going to be interesting to see whether or not a larger company decides to step ahead of the AstraZeneca data, or they end up waiting until that data is out to see what that competitive landscape may look like further on down the road. Vascepa really is the only engine in the car that is Amarin. It'll be really interesting to see what ends up happening with this company in the next year or two.

Jones: Yeah, absolutely. Always good to have positive trial news, especially in biopharma land, and especially to see this with a drug that's not your typical biotech drug. It is literally fish oil. We even saw this, too, with CBD and marijuana. Someone even said in the bio Twitter world that this is really the year of natural medicines making a run for it. Fascinating stuff, really great science. We'll be keeping an eye on that. We'll be sure to keep our listeners up to speed with all the comings and goings of who may be entering this market space.