Analysts are warning that Amarin's share price could be cut in half depending on the outcome of a key patent decision for its cardiovascular medicine Vascepa, expected in March, reported Bloomberg.
A federal judge in Las Vegas is considering the company's patent-infringement complaint that seeks to bar the entry of generic versions of the fish oil-based drug until six patents expire in 2030.
Citi analysts predict shares could rally 20% if Amarin prevails, and a loss could drive a 50% drop, while Jefferies saw even more downside, with the stock potentially falling roughly 70% from current levels.
Still, analysts from both banks were positive on Amarin's prospects ahead of the outcome expected in March. Vascepa revenues could hit over $1 billion by next year, according to analysts tracked by Bloomberg.
Citi analyst Joel Beatty suggested that investors are "overly concerned" about the risks to the patent for Vascepa.
However, even if Vascepa faced an immediate loss of its exclusive status, Beatty said the drug could still keep its price in the vast heart disease market, but "it would come down to how much share Amarin could maintain."
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