Amarin Corporation(AMRN) - 2025 Q2 - Quarterly Report

PART I – Financial Information The company's financial information includes detailed statements, management's analysis, market risk disclosures, and internal controls Financial Statements The company's financial statements for the period ended June 30, 2025, reflect a decrease in total assets and a widened net loss, despite improved operating cash flow Condensed Consolidated Balance Sheets As of June 30, 2025, total assets decreased to $670.1 million, while total liabilities increased and stockholders' equity declined due to the net loss | Balance Sheet Items (in thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Current Assets | $606,819 | $595,399 | | Cash and cash equivalents | $147,877 | $121,038 | | Short-term investments | $150,827 | $173,182 | | Inventory (Current) | $171,244 | $166,048 | | Total Assets | $670,126 | $685,349 | | Total Current Liabilities | $185,946 | $179,949 | | Total Liabilities | $205,202 | $199,173 | | Total Stockholders' Equity | $464,924 | $486,176 | Condensed Consolidated Statements of Operations Q2 2025 revenue increased due to licensing, but a significant restructuring charge led to a net loss for both the quarter and six-month period | (in thousands, except per share) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Total revenue, net | $72,741 | $67,491 | $114,757 | $124,010 | | Product revenue, net | $46,617 | $47,514 | $87,652 | $102,670 | | Licensing and royalty revenue | $26,124 | $19,977 | $27,105 | $21,340 | | Operating loss | ($15,985) | ($524) | ($32,742) | ($14,107) | | Restructuring Expense | $22,759 | $— | $22,759 | $— | | Net (loss) income | ($14,139) | $1,522 | ($29,836) | ($8,431) | | Diluted (Loss) earnings per Share | ($0.03) | $0.00 | ($0.07) | ($0.02) | Condensed Consolidated Statements of Cash Flows For the first half of 2025, operating activities provided cash, leading to a net increase in cash and equivalents, a turnaround from the prior year | (in thousands) | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $4,147 | ($15,350) | | Net cash provided by investing activities | $24,474 | $33,414 | | Net cash used in financing activities | ($1,782) | ($1,392) | | Net increase in cash | $26,839 | $16,672 | | Cash, end of period | $148,177 | $216,449 | Notes to Condensed Consolidated Financial Statements Key notes detail a global restructuring plan, a significant licensing agreement, contractual obligations, and ongoing litigation - Announced a global restructuring plan in June 2025 in connection with the Recordati licensing agreement, incurring approximately $22.8 million in charges for the quarter, with total expected charges between $30.0 million and $37.0 million[63] - Entered into an exclusive long-term license and supply agreement with Recordati in June 2025 to commercialize VAZKEPA in Europe, receiving a $25.0 million upfront payment which was fully recognized as revenue in Q2 2025[22][129][131] - As of the filing date, the company has future contractual purchase obligations of approximately $208.0 million, primarily related to long-term supply agreements for VASCEPA[80] - In a patent infringement lawsuit against Hikma, the Federal Circuit reversed a lower court's dismissal, finding Amarin's allegations plausibly state a claim of induced infringement. The case is proceeding in district court while Hikma's petition to the Supreme Court is pending[75] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the impact of generic competition, European strategy pivot, cost reduction efforts, and the company's strong liquidity position Overview Amarin focuses on commercializing VASCEPA/VAZKEPA, navigating U.S. generic competition, pivoting European strategy, and expanding globally - In the U.S., multiple generic versions of icosapent ethyl have launched, creating significant competition for VASCEPA[156][157] - In June 2025, the company entered an exclusive long-term license agreement with Recordati to commercialize VAZKEPA in 59 European countries, leading to a global restructuring plan estimated to save approximately $70.0 million annually[164] - The company is expanding globally through partnerships in China (Edding), Canada (HLS), Australia/New Zealand (CSL), and other regions, with regulatory approvals received in 15 countries outside the U.S. and Europe[170][171] Results of Operations Q2 2025 revenue increased due to a licensing deal, offsetting U.S. product decline, but a restructuring charge resulted in a net loss | Revenue Comparison (in millions) | Q2 2025 | Q2 2024 | Change | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Total Revenue, Net | $72.7 | $67.5 | +8% | $114.8 | $124.0 | -7% | | U.S. Product Revenue | $36.5 | $43.8 | -17% | $72.2 | $91.9 | -21% | | Europe Product Revenue | $6.6 | $3.5 | +89% | $12.0 | $5.4 | +122% | | Licensing & Royalty Revenue | $26.1 | $20.0 | +31% | $27.1 | $21.3 | +27% | - U.S. product revenue declined due to lower net selling prices from generic competition and decreased volume, partly from losing exclusive coverage with a large PBM. Amarin's share of the U.S. icosapent ethyl market fell to 43% in Q2 2025 from 59% in Q2 2024[197][198] - A restructuring expense of $22.8 million was recorded in Q2 2025 related to the elimination of European commercial roles following the Recordati agreement[210] - Selling, general and administrative (SG&A) expenses were flat YoY for Q2 2025 at $38.7 million, as higher G&A costs related to the Recordati deal were offset by lower selling expenses from reduced promotional activities[206] Liquidity and Capital Resources The company maintains strong liquidity with significant cash and investments, positive operating cash flow, and sufficient funds for future operations - Total liquidity as of June 30, 2025, was $298.7 million, consisting of $148.2 million in cash, cash equivalents, and restricted cash, and $150.8 million in short-term investments[238] - The company has an approved share repurchase program for up to $50.0 million of its ADSs, valid until Q2 2029, though no repurchases have been made to date[243] - Management has concluded that existing cash and investments are sufficient to fund projected operations for at least one year from the financial statement issuance date[245] Quantitative and Qualitative Disclosures about Market Risk The company reports no material changes to its market risk disclosures since the last annual report - There have been no material changes in the company's exposure to market risk since the last annual report[247] Controls and Procedures Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes in internal control over financial reporting - The principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective at a reasonable assurance level as of June 30, 2025[250] - No changes occurred in the company's internal control over financial reporting during the quarter ended June 30, 2025, that have materially affected, or are reasonably likely to materially affect, these controls[251] PART II – Other Information This section covers legal proceedings, updated risk factors, equity security sales, other disclosures, and a list of exhibits Legal Proceedings This section refers to Note 5 of the financial statements for details on ongoing legal proceedings - For information regarding legal proceedings, the report refers to Note 5 – Commitments and Contingencies in the financial statements[253] Risk Factors Updated risk factors highlight dependence on a new collaboration partner, risks from recent workforce reduction, and potential Nasdaq delisting concerns - A key risk is the company's dependence on Recordati for the commercialization of VAZKEPA in Europe. Success is contingent on Recordati's efforts, resources, and strategy, which are outside of Amarin's direct control[256][259] - The recent reduction in force, primarily in European commercial operations, carries risks that could adversely affect revenues or expenses if not managed successfully[258] - The company faces a risk of its ADSs being delisted from the Nasdaq Stock Market if it fails to maintain the minimum $1.00 bid price requirement. Although compliance was regained in April 2025 after an ADS ratio change, there is no guarantee of future compliance[261] Unregistered Sales of Equity Securities and Use of Proceeds During Q2 2025, the company withheld ADSs to satisfy tax obligations for employee equity awards | Period (2025) | Total ADSs Purchased | Average Price Paid per ADS | | :--- | :--- | :--- | | April 1 - 30 | 4,781 | $13.15 | | May 1 - 31 | 1,718 | $13.34 | | June 1 - 30 | 40,174 | $15.79 | | Total | 46,673 | $15.43 | Other Information No officers or directors adopted, modified, or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during Q2 2025 - No officers or directors engaged in the adoption, modification, or termination of Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during Q2 2025[265] Exhibits This section lists key exhibits filed with the Form 10-Q, including a major licensing agreement and officer certifications - Key exhibits filed with this report include the License and Supply Agreement with Recordati dated June 20, 2025, and officer certifications pursuant to the Sarbanes-Oxley Act[267]