Amarin Plummets After Patent Appeal Shows Key Drug Sales at Risk

Amarin Corp. fell the most since March after it faced tough questioning from a U.S. appeals court reviewing the validity of patents on its only product, the heart treatment Vascepa.

The three-judge panel of the U.S. Court of Appeals for the Federal Circuit had no questions at argument Wednesday for the defendants, generic-drug makers Hikma Pharmaceuticals Plc and Dr. Reddy’s Laboratories Ltd.

“I can’t remember an oral argument where the judges had no questions for one party,” said Michael Cohen of MDC Financial, a legal expert who listened to the hearing. “We believe if they were going to overturn the ruling in the party’s favor they would more likely be in their face asking questions.”

Amarin stock fell as much as 31%, the worst decline since the March court ruling that invalidated its six patents on the heart treatment Vascepa, which weren’t set to expire until 2030. The ruling opened the door to low-cost generic versions of the drug, and wiped out $3.5 billion in market value.

“We do not gain any more confidence that Amarin will prevail, actually we are slightly less confident,” Stifel analyst Derek Archila wrote in a research note. “We would not be buying shares here.”

The trial court accepted the defendants’ argument that the patents were obvious because a version of Vascepa’s active ingredient, a type of fish oil, has been known since the 1990s.

“I don’t think this will be controversial among the panel, I think it’s going to be a clear affirmance,” Dan Ravicher, a law professor at the University of Miami, said by phone. “It’s weird for such an important case that could be worth billions of dollars to be so straight forward.”

The case is Amarin Pharma, Inc. v. Hikma Pharm. USA Inc., Fed. Cir., No. 20-1723, argued 9/2/20.

©2020 Bloomberg L.P.

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