Amarin Corporation plc (ADR) (NASDAQ:AMRN)’s requires funds to launch “Vascepa”
Amarin Corporation plc (ADR) (NASDAQ:AMRN) Amarin Corporation declined 7.96% on the trade volume of 5.37 million shares to $5.68. The company made an announcement yesterday regarding their new share offerings to the public. The value of shares was decreased by 8%. Each share is worth with more number of shares in the open market. Amarin is planning to sell 21.7 million American Depositary Shares (ADSs) to the public and the sales underwriters also have an option to buy 3.255 million shares in 30 days, which are offered at current market prices. The joint book-running managers and underwriters in this particular offering will be Jefferies LLC and Citigroup Global Markets Inc.
This fresh offering of Amarin Corporation represents about 14% of the outstanding shares, which is around 150.7 million. The underwriters are having the chance of making up 2% excluding this 14%. The decrease of 8% has the efficiency to produce two times the share dilution. The company is providing this public offering as it wants to use the profit generated to fund the continued launch of “Vascepa”, triglyceride-lowering drug commercially. Amarin will be in need of more funds during 2014 and the company should take care of it. However, the sales of Vascepa have been increasing which is the good news.
Amarin’s ability to commercialize Vascepa to its complete potential successfully against larger competitors with fish-oil pills is skeptical. The competitors include GlaxoSmithKline plc which is marketing the drug, “Lovaza” and was able to make about $3.8 billion from the drug over the past 5 years and AstraZeneca plc which has bought Omthera Pharmaceuticals during the month of May with the primary purpose of gaining its fish-oil drug called “Epanova”.
Like many other stocks of pharmaceutical and biotech companies, those that of Amarin Corporation also bears considerable amount of risk. This brings the companies, the capacity to receive the rewards in return to all the risks taken.