A new hope for Amarin? Vascepa generic settlement leaves analysts split on patent appeal success

Amarin Vascepa pill
Amarin's patents on Vascepa were tossed for obviousness by a Nevada district judge in March. (Amarin)(Amarin Corporation)

Eyeing blockbuster sales for its cardiovascular drug Vascepa, Amarin took a nightmarish hit in March when a federal judge struck down key patents. Now, in its quest to overturn that ruling, the company has snagged a settlement with one generic challenger—but analysts are split on whether that deal portends a win for Amarin on appeal.

Amarin agreed Tuesday to a settlement with generics maker Apotex that would put off a Vascepa copycat until August 2029 if the New Jersey drugmaker wins its appeal to reinstate Vascepa's underlying patents.

The deal will bring Apotex in line with Teva, which previously agreed to delay its Vascepa generic until 2029, SVB Leerink analyst Ami Fadia said in a Wednesday note to investors. If Amarin loses its appeal, Apotex would immediately be able to launch its generic without any new litigation. 

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For Cantor analyst Louise Chen, the settlement suggested that Apotex might see a path to Amarin winning its appeal, despite investors' lack of enthusiasm about the drugmaker's chances.

"If Apotex thought [Amarin] would lose the appeal then it could have waited a few months for a near-term opportunity to launch versus waiting until 2029," Chen wrote in a Wednesday note to clients. "We think this settlement could potentially move sentiment toward a potential win for [Amarin]."

Fadia, however, noted that a deal with Apotex––a generics maker that is not party to the patent lawsuit––didn't mean much for Amarin's patent appeal and represented a strategic "doubling down" on the outcome of the lawsuit.

"In our view, today's settlement puts more at stake for Amarin, and reflects management doubling down on the strength of its appeal's case, although we don't disagree with the decision given the risk/reward on the appeal is heavily skewed to the upside," Fadia wrote.

RELATED: Amarin's Vascepa loses one more shield with Hikma's generic approval