What happened
Ahead of long-term outcomes data from its cardiovascular outcomes study of Vascepa in September, Amarin Corporation plc (AMRN -2.11%) shares increased by 23.9% in August, according to S&P Global Market Intelligence.
So what
Vascepa is a purified fish-oil pill that won FDA approval in 2012 to lower triglycerides in patients with very high triglyceride levels.
IMAGE SOURCE: GETTY IMAGES.
The company's sales of Vascepa have been hamstrung by the lack of proof that lowering triglyceride levels can directly reduce the likelihood of a major cardiovascular event, such as heart attack, stroke, or death. Yet Vascepa's revenue has been growing steadily, and in the second quarter, Amarin reported revenue of $52.6 million, up 16.4% year over year.
Earlier this year, Amarin reported that the final patient visit has occurred in its six-year outcomes study, and on Aug. 26, management said that the study is on track for "top-line results before the end of September 2018."
Now what
The stakes are high for Amarin. If its outcomes study is a success, then Vascepa could win considerably greater use, because there are roughly 3.8 million Americans with triglyceride levels of 500 to 2,000 mg/dl. Alternatively, if the trial fails, then sales could dwindle, casting a shadow over Amarin's future. Although sales have been climbing, Amarin lost $68 million on revenue of $181 million in 2017.
Overall, Vascepa's trial could go either way, and the binary nature of the trial and resulting impact on the company's financial condition means this stock is only suitable for aggressive and risk-tolerant investors.
