Elan spin-out Amarin is hit with fresh lawsuit in the US
Pressure is being heaped on Dublin pharma firm Amarin after being stung with a fresh class-action lawsuit in the United States just weeks after a regulatory panel advised approval shouldn't be given to expand the use of its only drug.
A spin-out from Elan, Amarin shares plunged over 60pc in one day in October when an advisory committee for the US Food & Drug Administration (FDA) voted against recommending that its Vascepa cholesterol-lowering treatment be approved for use in patients with high levels of fatty triglycerides in their blood.
Vascepa is already used to treat patients with very high levels of the troublesome triglycerides.
The advisory committee said any decision to expand the use of Amarin's drug should be kept on ice until the results of a trial involving 8,000 patients are known in 2016. That study is expected to cost Amarin between $30m and $40m (€22m and €29m) this year alone, while next year it will also incur a hefty outlay.
Lawyers instantly jumped on the failure of Amarin to win over the FDA advisory committee, with class-action suits piling up behind the firm. The latest has just been filed in New York.
It's targeting shareholders who acquired Amarin shares on the Nasdaq between 2009 and October this year.
The complaint alleges that Amarin misrepresented the prospects for FDA approval for wider Vascepa use and also that the firm issued "materially misleading statements" about its business, operations and financial prospects.
At least three class-action suits have been filed against Amarin in recent weeks.
While the FDA isn't due to make an official ruling on Amarin's application to broaden the use of Vascepa until this week, it is highly likely that it will follow the vote of the advisory committee and block additional use of the drug.
If it secured approval for wider use of the treatment, Amarin would be able to target additional people in the US who have high levels of triglycerides. That's a potential patient pool about nine times bigger than it has.
Amarin, which is headed by chief executive and chairman Joseph Zakrzewski, released third-quarter financial results last month and said it was unclear whether it would be able to keep funding the costly study for Vascepa. Mr Zakrzewski also said Amarin had axed about half its 100 or so staff following the negative advisory committee vote.
Amarin had notched up losses of almost $151m in the first three quarters of this year, while at the end of October it had $226m in cash and equivalents.