Amarin's future dims further as FDA nixes 5-year Vascepa exclusivity

For Amarin ($AMRN), FDA approval for its drug Vascepa wasn't enough. The company needed more from the agency. For one thing, it needed the FDA to deem Vascepa, a cardiovascular drug derived from fish oil, a New Chemical Entity. That designation comes with 5 years of market exclusivity.

Amarin didn't get it.

As The Street reports, the FDA finally told Amarin that it doesn't consider Vascepa an NCE. It's simply a New Product--yes, that's an official term--and NP status only confers 3 years of exclusivity.

Courtesy of Amarin

Amarin does have patents on Vascepa, but the shorter exclusivity term means it could have to fight off generic challengers as early as next July, rather than in 2017. Generics makers could file for approval then. That would set off a patent lawsuit, no doubt, which in turn would give Amarin the automatic 30-month extension allowed under the Hatch-Waxman Act, as The Street points out. Worst-case scenario, legally: generics on the market in early 2018.

But Amarin faces the more immediate danger of a marketing worst-case scenario, and again it's waiting on the FDA. Vascepa is only approved for patients with very high triglycerides, a relatively small group. The company is trying to make a case for Vascepa as a treatment for mixed dyslipidemia--a much larger population--but an FDA panel voted down that idea in October. The Advisory Committee didn't believe Vascepa actually could hold off coronary artery disease. The agency hasn't decided for certain whether to go along with the advisory committee's thumbs-down vote, but it usually follows panel recommendations.

Early on, analysts had predicted that Vascepa could hit $450 million in sales this year. Amarin actually borrowed $100 million to pay for the drug's launch. Since then things have changed, obviously; notably, Vascepa's head-to-head rival, the GlaxoSmithKline ($GSK) drug Lovaza, came up on the wrong side of a patent ruling, and could face generic competition soon. Those generics could not only cut into Lovaza sales, but Vascepa's, such as they are. Market-watchers are looking for $71 million this year, The Street says.

- read The Street's take