Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of the small-cap biopharma Amarin Corp. (NASDAQ:AMRN) broke higher by more than 25% on exceptional volume this morning following a major upgrade by an analyst for H.C. Wainwright. Specifically, the firm placed a "Buy" rating on the stock (up from Neutral) and stated that they believe the stock has a whopping 515% potential upside, compared to where shares ended the day yesterday. 

So what: Amarin has been a mess of a stock since the Food and Drug Administration revoked the Special Protocol Assessment, or SPA, agreement for the ANCHOR clinical trial for the company's prescription fish-oil pill Vascepa. As a reminder, the FDA repealed the SPA due to issues over the clinical trial's design and doubts about the ability of fish oil pills in general to improve cardiovascular outcomes. 

Because Vascepa is only currently approved for patients with severely high (≥ 500 mg/dL) triglyceride levels, it has had a hard time gaining traction on the commercial front, generating a mere $54 million in sales last year. The ANCHOR trial data would have expanded the label to include adults with moderately high triglycerides (TG ≥200 mg/dL & < 500 mg/dL), dramatically increasing the drug's commercial prospects. 

What H.C. Wainwright's position appears to be is that Amarin's decision to continue operating at steep losses in order to fund the pivotal cardiovascular outcomes study, REDUCE-IT, could create significant value for shareholders down the road. Indeed, if this study does report positive results, it should open up a much larger market for the fish-oil pill. 

Now what: Amarin won't be cash flow positive any time soon given its massive cash burn rate, and its entire future probably hinges on REDUCE-IT's outcome. So there are some good reasons to be skeptical about this lofty upgrade, suggesting that caution may be the best course of action.