Amarin ($AMRN) couldn't wait for the FDA's final decision on whether to grant its fish oil drug Vascepa approval for wider use. With the handwriting on the wall, its stock price in the toilet and cash burning, the drugmaker said today that it will cleave half of its staff.
A week ago, an FDA panel of experts voted 9-2 not to recommend that the FDA expand the use of the omega-3 product. FDA staff earlier had suggested a heart-risk study be completed before the FDA decided. The FDA has yet to make its final decision, but with two strikes against expansion, the drugmaker acted.
Today the drugmaker said 50% of its staff would have to go to allow it to reduce expenses. The drugmaker did not say how many positions that would amount to, but it reported having 111 employees at the end of last year. It said it would keep its highest performing sales staff to continue to sell the drug, which is already approved to reduce very high triglycerides in adults. The drugmaker had sought approval for use of fish-oil drug Vascepa with a cholesterol-lowering statin to reduce the risk of coronary disease.
The drugmaker said that it has about $226 million in cash on hand. It expects to spend $3 million on the restructuring and predicted its cash burn next year would be less than $80 million. Shares were down about 4% in after-hours trading. The company saw the floor drop out from under its share price, falling 60%, after the vote a week ago.
When no potential partners came forward after Amarin got the drug approved last year, the Irish company borrowed $100 million to pay for the drug's launch. Vascepa competes with GlaxoSmithKline's ($GSK) fish oil pill Lovaza, which was approved in 2004, also for patients with very high triglycerides. Lovaza had sales of £607 million ($968 million) last year. Vascepa had sales last quarter of $5.5 million. The company said it would continue to work with the agency on the drug.
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