Shares of Amarin (AMRN) are on the rise on Tuesday after Citi analyst Joel Beatty upgraded the stock to Buy from Neutral, arguing that now is an attractive time to buy with the shares trading 27% lower since November. Further, the analyst argued that Vascepa sales should "accelerate strongly" over the next few years.
BUY AMARIN: In a research note to investors, Citi analyst Joel Beatty upgraded Amarin to Buy from Neutral and lowered his price target on the shares to $24 from $27. With the stock trading 27% lower since November, now is an attractive time to buy, Beatty contended.
The analyst pointed out that he still believes Vascepa sales will "accelerate strongly" over the next couple years since the 25% relative risk reduction is strong enough to motivate prescribers and patients to use Vascepa, Vascepa is safe enough for primary care physicians to be comfortable prescribing it instead of referring to a specialist, the doubling of the sales force that took place around year-end 2019 should make a meaningful impact, Vascepa's direct-to-consumer marketing should be approved by FDA around mid-2020, the CVOT benefit strongly differentiates Vascepa from generic triglyceride-lowering therapies, Vascepa is unusually cost-effective compared to most branded drugs, and Vascepa could potentially be included in new guidelines over the coming months. Additionally, the analyst argued that Amarin will likely emerge from the ongoing intellectual property litigation with Vascepa exclusivity largely intact.
JEFFERIES ALSO CONFIDENT IN PATENT TRIAL WIN: As previously reported following the ending of court proceedings for the Amarin versus Dr. Reddy’s (RDY) and Hikma Pharmaceuticals (HKMPF) case, Jefferies analyst Michael Yee noted that the written ruling is expected by March 31 and said that he is now more confident that Amarin is likely to prevail, "removing the chief overhang on the stock." Amarin shares have been relatively range bound despite positive news on the competitive front with two key competitor trials having failed, the analyst pointed out. He attributed this to uncertainty associated with the patent trial and the potential risk for Reddy's and Hikma, two prospective generics for Amarin's Vascepa, to present some "bombshell" evidence. However, the analyst now thinks it will be hard for the judge to not rule in favor of Amarin. Yee sees the stock up 10%-20% on a positive ruling. He has a Buy rating on Amarin's shares.
PRICE ACTION: In morning trading, shares of Amarin have gained almost 2% to $17.89.
Amarin
+0.3 (+1.70%)
Dr. Reddy's
-0.13 (-0.29%)
Hikma Pharmaceuticals
+ (+0.00%)