Following the fourth day of the ongoing patent trial versus Hikma and Dr. Reddy's (RDY), Jefferies analyst Michael Yee said he believes Amarin (AMRN) remains in a "good position" to protect its patents on Vascepa, its omega-3 product to treat adult patients with elevated triglyceride levels and other risk factors for cardiovascular disease. The analyst added that he does not believe the generics have made a "strong case" or met the burden for proving they do not infringe Amarin's patents.
'GOOD POSITION' IN ONGOING PATENT TRIAL: In a research note to investors on Monday, Jefferies’ Yee maintained a Buy rating with a $30 price target on Amarin's shares saying he believes the company remains in a "good position" to protect its patents on infringement" and "obviousness." The analyst noted that day four of the trial included testimony from Hikma/Dr. Reddy's expert witness on the claim of obviousness, but argued that the testimony did not appear to add much to their case.
Overall, Yee does not believe the generics have made a strong case or met the burden for proving they do not infringe since it mostly always requires chronic dosing, and obviousness as the results of Vascepa "were surprising and unexpected." Given that the burden of proof is with the defense to prove Amarin's patents are invalid, the analyst believes that following the defense's witness, the company could seek immediate dismissal of the obviousness claim such that only infringement would be left to rule on. However, while this is possible, it is not expected and since "Judge [Miranda] Du has mostly been by the book, she would be expected to let the trial proceed."
In a previous note following day three of the trial, which focused on the claim of nonobviousness and examination of the defense's witness, Yee had said that with the burden of proof already high for obviousness, barring some new evidence or “radical interpretation” by the Judge, Amarin is "likely to prevail on upholding the patent." The trial will last until the end of January and a decision is expected around March or April, he added.
PRICE ACTION: In late morning trading, shares of Amarin have gained over 7% to $21.35.
Amarin
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