Amarin Stagnates Despite New Attention From The Market
Myriad Equity | Feb 13, 2013 05:22AM ET
It seems that the market’s attention is once again turning to Amarin Corporation (AMRN), which has recently launched the much anticipated prescription omega-3 hypertriglyceridemia drug Vascepa into the United States. Sales revenue is expected to become grow impressively over time because of the improved safety profile that Vascepa offers when compared to the current leader of the market, Lovaza – marketed by GlaxoSmithKline (GSK). Lovaza is an extremely successful drug, which boasts annual revenues of over $1 billion in the US alone (and over $400 million abroad). Given its current valuation of ~$1.3 B, the market is generally saying that Amarin won’t even be able to match Lovaza’s sales.
Despite the big potential of the drug, it seems that the market still can’t get over the fact that Amarin has not been acquired. Recall that in 2012, the AMRN investment community was utterly obsessed with the notion that there were buyers lined up to partner with, or buy the company outright. There were very big rumors about Teva Pharmaceuticals TEVA) and AstraZeneca (AZN) in particular, which were rumored to be some of Amarin’s most interested potential acquirers.
It was due to this intense M&A speculation that I decided to purchase some AMRN for myself, with the intent to reap options premiums from the call options buyers who were expecting a buyout of AMRN north of $20/share in the near future. This was driving call options premiums through the room, and it ended up being a gold mine for those who expected AMRN to be acquired at a later date (like myself).
Unfortunately, all good things come to an end. This was the case for the M&A speculation over Amarin, especially after the company’s here .
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