Amarin Corporation plc (NASDAQ: AMRN) is a stock that’s leading to quite a bit of debate at the moment. While the company reported what was originally viewed as positive clinical data over the weekend, concerns with regard to the data started to appear Monday, leading the stock down from highs and deep into the red. Today, the downward trend is continuing. Nonetheless, I’m here to tell you that now is the time to buy! Today, we’ll talk about the data, why now is the time to buy AMRN, what we’re seeing from the stock, and what we’ll be watching for ahead.
AMRN And The Clinical Data Debate
As mentioned above, Amarin Corporation is falling in the market today as a debate continues with regard to Vascepa, the company’s treatment for the reduction of cardiovascular risk. Vascepa is a chemically icosapent ethyl that contains Omega-3 acid. While the treatment is derived from fish it is not what we think of when we think of Omega-3 fish oil. Over the weekend, the company presented data, confirming the efficacy of the treatment.
During the Phase 3 trial, data produced confirmed a 25% relative risk reduction, meeting the primary endpoint of the trial. The company reported multiple bits of data showing strong efficacy, including a 20% relative risk reduction in cardiovascular death.
During the clinical trial, dubbed the REDUCE-IT trial, the company compared 4mg per day of Vascepa to a placebo. 8,179 patients were treated, either with Vascepa or placebo and followed for an average of 4.9 years.
AMRN also met several secondary endpoints, including its primary secondary endpoint. This was achieved with a 26% relative risk reduction in cardiovascular death, non-fatal heart attack and non-fatal stroke. There were several additional secondary endpoints also met through the clinical trial.
So, Why Is The Stock Falling?
This is where things get interesting for Amarin Corporation and its investors. Adam Feuerstein, noted biotechnology sector analyst weighed in with his opinions on the trial. In fact, he argued that the placebo arm of the trial used meral oil that could have harmed those in the placebo arm. Feuerstein went on to say that should the mineral oil not have been included, the “sheen” would have been reduced.
Why Now Is The Time To Buy
With AMRN falling, many might want to steer clear. However, I believe that now is a perfect time to get involved. Sure, Adam Feuerstein is a trusted figure in the biotechnology space, and he has done well in his career. However, Feuerstein has also been wrong.
The truth of the matter is that the stock is falling into discount territory on statements made by the analyst. However, the truth of the matter is that this analyst is likely wrong. Here’s why:
First and foremost, the data was presented at the American Heart Association. While all clinical data is subject to debate, the AHA would not likely have allowed the presentation to take place if there was such a clear advantage provided to the Vascepa arm of the trial. This would mean that the data would have been skewed and would have risked the reputation of the American Heart Association.
Also, the New England Journal of Medicine has weighed in on the debate. This peer reviewed, highly respected medical journal has concluded that the mineral oil could not have explained such a significant result in the data.
Finally, it’s worth mentioning that the FDA approved Vascepa back in 2012. The treatment was approved as an option for high levels of triglycerides in blood. This approval is also a source of validation for the treatment. The FDA doesn’t just approve anything. Even in 2012, Vascepa generated such strong efficacy data that the drug made it through to FDA approval and is generating revenue for AMRN today. While there was not enough data back then to tackle the cardiovascular risk indication, there is now, and the data is likely going to be strong for an approval of an expanded indication.
The bottom line here is that either you go with Feuerstein, and the drug remains approved for the reduction of triglycerides, continuing to generate revenue, or AMRN, the New England Journal of Medicine and the American Heart Association are right, and the implications could be massive. This expanded indication could bring the company to the next level, and its stock to tremendous new highs. In my view, the rewards far outweigh the risk here.
What We’re Seeing From The Stock
As mentioned above, Amarin Corporation is falling in the market today, but I believe those declines represent an opportunity. Nonetheless, our partners at Trade Ideas were the first to alert us to the declines. At the moment (11:08), AMRN is trading at $18.80 per share after a loss of $1.02 per share or 5.15% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on AMRN. In particular, we’re interested in following the story surrounding the company’s continued work to bring Vascepa to patients at high cardiovascular risk. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!