Amarin (NASDAQ:AMRN) is facing a pivotal advisory committee meeting on October 16th with the Food and Drug Administration for Vascepa's ANCHOR indication, followed by the all-important PDUFA date scheduled for December 20th. This meeting is critical because it will determine if Vascepa can be used to treat adult patients with moderately high triglycerides (TG ≥200 mg/dL and < 500 mg/dL) with mixed dyslipidemia. To date, Vascepa has only been approved by the FDA as an adjunct to diet to reduce triglyceride (TG) levels in adult patients with severe (≥ 500 mg/dL) hypertriglyceridemia. If approved, Vascepa would be the only FDA approved prescription omega-3 therapy for patients with moderately high triglycerides and mixed dyslipidemia, opening up a much larger market for the drug.

Is the Pending Advisory Committee A Red Flag?

The fact that the FDA actually scheduled an advisory committee meeting is a tad worrisome, however, given that the ANCHOR indication was performed under a Special Protocol Assessment (SPA). Simply put, the FDA could have proceeded without an advisory committee on its way to largely rubber stamping the expanded indication.

Advisory committees tend to be formed when there are specific scientific or ethical concerns over a drug, which need to be publicly vented to lend credibility to the review process. Yet, ANCHOR's clinical trial results appear to be anything but controversial. Specifically, patients in the ANCHOR trial showed statistically significant reductions in very-low-density lipoprotein (VLDL), low-density lipoprotein (LDL), and small LDL particles when taking Vascepa with a statin, compared to patients taking a placebo. In other words, Vascepa is a viable treatment option for patients with moderately high triglycerides, and the clinical trial trials support this conclusion.

My take is that the panel was called primarily to discuss the ongoing REDUCE-IT cardiovascular outcomes trial. As part of the SPA, Amarin agreed to evaluate the effectiveness of Vascepa in reducing the first major cardiovascular events in an at-risk patient population, i.e. the REDUCE-IT trial. Given that the REDUCE-IT trial is expected to enroll 8,000 patients and take up to 6 years to complete, Amarin decided to seek approval for the ANCHOR indication when they deemed the REDUCE-IT trial to be "significantly under way".

And this issue has caused a great deal of confusion among investors. Namely, the widely held belief has been that the FDA has specifically agreed, under the SPA, to review the ANCHOR trial with incomplete REDUCE-IT results. Nonetheless, Amarin's own press releases make it clear that this was a decision the Company made, not the FDA.

How the FDA truly feels about the ANCHOR indication will more or less be revealed in the Briefing Documents, likely to be released October 11th. As an Amarin investor, I would pay special attention to the FDA's comments regarding REDUCE-IT, and particularly look for any surprises regarding unexpected cardiovascular outcomes. After all, if the ANCHOR indication is approved, there will be plenty of upside in the stock. By contrast, speculating too early could lead to a painful lesson due to the vital importance the ANCHOR indication will play in terms of Vascepa's overall commercial success.

How Important is the ANCHOR Indication?

GlaxoSmithKline's (NYSE:GSK) fish oil pill Lovaza is hovering near blockbuster status with around $970 million in sales in 2012 (at current exchange rates). Although Lovaza is only approved in the U.S. as an indication for severe (≥500 mg/dL) hypertriglyceridemia, the drug is often used off-label for patients with only moderately high triglycerides—helping the drug to reach these stellar sales figures. In a similar manner, AbbVie's (NYSE:ABBV) Tricor and Trilipix are indicated as general treatments for hypercholesterolaemia and hypertriglyceridaemia and had combined sales exceeding $1 billion a year. Generic competition for Tricor will see this market get even more competitive. These drugs combined thus show that there is a growing, multi-billion dollar market that Vascepa could tap into with an approval for the ANCHOR indication. Indeed, the ANCHOR indication would give Amarin a significant leg up, as they would have a monopoly on FDA approvals among fish oil pills for this market segment. The importance of this upcoming advisory committee for Amarin's immediate future can therefore not be understated.

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This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.