Amarin Corporation PLC (AMRN) 2015 Q3 法說會逐字稿

Welcome to Amarin Corporation's conference call to discuss its financial and operating results for the third quarter of 2015.

This conference is being recorded today, November 4th, 2015.

I would now like to turn the conference over to Mike Farrell, Vice President of Finance for Amarin.

Welcome, and thank you for joining us today.

Please be aware that this conference call will contain forward-looking statements that are intended to be covered under the Safe Harbor provided by the Private Securities Litigation Reform Act. Examples of such statements include, but are not limited, our current expectations regarding our commercial and financial performance, including levels of Vascepa sales, revenues, and other commercial metrics, expenditures, supplier-related activities, managed-care coverage, and the adequacy of our financial resources, our expectations regarding product development internationally, government agency decisions and pending litigation, our current expectations regarding our cardiovascular outcome studies, such as anticipated enrollment, the related regulatory process, and potential outcomes, our plan to protect the exclusivity and commercial potential of our product, and our expectations regarding our co-promotion agreement and our business generally.

These statements are based on information available to us today, November 4th, 2015. We may not actually achieve our goals, carry out plans, or intentions or meet the expectations disclosed in our forward-looking statements.

Actual results or events could differ materially. You should not place undue reliance on these statements. We assume no obligation to update these statements as circumstances change.

Our forward-looking statements do not reflect the potential impact of significant transactions we may enter into, such as mergers, acquisitions, dispositions, joint ventures, or any material agreement that we may enter into, amend, or terminate.

For additional information concerning the factors that could cause actual results to differ materially, please see the forward-looking statement section in today's press release and the risk factors section of our Quarterly Report on Form 10-Q, for the three and nine months ended September 30th, 2015.

These documents have been filed with the SEC and are available through the Investor Relations section of our website at www.amarincorp.com. We encourage everyone to read these documents.

This call is intended for investors in Amarin, and is not intended to promote the use of Vascepa outside of its approved indication.

Finally, an archive of this call will be posted to the Amarin website in the Investor Relations section.

In addition to myself, on today's call from Amarin are John Thero, our President and Chief Executive Officer; Steve Ketchum, our President of R&D; Joe Kennedy, our General Counsel; and Aaron Berg, our Senior Vice President of Marketing and Sales.

I'll now turn the call over to John Thero, President and Chief Executive Officer of Amarin.

Good morning. Thank you for joining us today. Many things have been going well for Amarin in recent months. Hopefully, that's clear from the press release we issued this morning. In this conference call, we will discuss Amarin's recent commercial, operational, and financial performance, provide an update on important Company initiatives and legal matters, and then take questions from analysts and investors.

Our priorities for 2015 remain unchanged -- support improved patient care with Vascepa; increase revenues; continue to execute on our cardiovascular outcome study, REDUCE-IT; and manage our business in an opportunistic and cost-effective manner.

Highlights of our Q3 2015 progress include record prescription and revenue growth from Vascepa in Q3, with net product revenues 51% higher than Q3 2014. REDUCE-IT continuing to progress on schedule, with events accumulating at rates consistent with our modeling, and enrollment now more than 97% complete against the 8,000 patient target. Steve Ketchum will provide a more detailed update on REDUCE-IT.

In August, we received a favorable court declaration, allowing Amarin to present healthcare providers truthful, non-misleading information regarding use of Vascepa that's outside current FDA-approved labeling, including results of the successful ANCHOR study.

As expected, we are finding that physicians were not aware of the ANCHOR study results, and that they appreciate learning this data. And multiple presentations of new data further support the potential benefits of icosapent phenolic acid EPA, the active ingredient in Vascepa, including presentations at the American Society of Preventive Cardiology annual cardiovascular disease prevention conference, and the current lipid conference.

I would now like to further describe the continued commercial progress that we made during Q3. In the quarter, normalized prescriptions of Vascepa are 199,000 and 176,000 were reported based upon data from Symphony Health Solutions and IMS Health, respectively. These levels represent increases of approximately 51% and 56%, respectively, over the corresponding quarter in 2014, and represent growth of 13% and 12%, respectively based upon datasets over the second quarter of 2015.

Vascepa net product revenues during the third quarter of 2015, of $21.3 million reflected growth of 51% over Q3 2014, and growth of 20% over Q2 of 2015.

Wholesaler inventory levels remained consistent during Q3 2015 and were similar to Q3 2014.

Our average net selling price of Vascepa in Q3 2015 was flat with our average selling price in Q2 2015.

In mid-August we commenced sales and marketing promotional activities pursuant to the recent First Amendment litigation decision. Aaron will discuss this further in a moment.

Before Aaron Berg covers commercial matters and Steve Ketchum covers R&D matters, I will comment briefly on our First Amendment progress. Joe Kennedy is with us and available at the end of this call for questions on legal matters.

As previously disclosed, we, together with plaintiff physicians, have achieved initial success in our First Amendment litigation. The federal court judge declared that Amarin may promote to healthcare professionals use of Vascepa not covered by current FDA-approved labeling for the drug, so long as the promotion is truthful and non-misleading.

The court declaration covers promotion of the FDA-reviewed and agreed effects of Vascepa demonstrated in the ANCHOR clinical trial of patients with persistently high triglycerides after statin therapy and supportive use of peer- reviewed scientific publications that present the current state of scientific research related to the potential of Vascepa to reduce the risk of cardiovascular disease.

We believe that healthcare professionals will benefit from having such information when making decisions regarding how to best treat their patients. As a result of the successful outcome of the First Amendment litigation, during Q3 we initiated new programs to more broadly educate healthcare professionals about the ANCHOR trial data. While we are optimistic about the implementation of these new programs, it is too early to quantify the potential impact on prescription growth.

In October, the FDA had a deadline for appealing the federal court judge's declaration. The FDA elected to not appeal the matter. As a reminder, the judge's declaration was in response to our request for a preliminary ruling and the underlying First Amendment litigation is currently stayed, pending settlement discussions, until December 17th.

It would not be appropriate or constructive at this time for us to characterize the substance of such settlement negotiations, other than to say that we are working with the government to resolve the case completely, and we don't expect that process to alter our current path expanding the promotion of Vascepa to healthcare professionals.

I now ask Aaron Berg, our Senior Vice President of Marketing and Sales, to comment further on our commercial progress.

Thank you, John. As John mentioned, we're pleased that Vascepa prescriptions and revenues grew meaningfully in Q3. The prescription numbers from Symphony Health Solutions and IMS Health, as cited by John, representing growth of approximately 13% and 12%, respectively compared to the quarter ended June 30th, 2015, and increases of approximately 51% and 56%, respectively, compared to the same quarter in 2014.

We experienced growth throughout Q3, starting in July. In August 2015, as previously announced, a United States district court granted Amarin's request under the First Amendment for preliminary relief, and confirmed that Amarin may engage in truthful and non-misleading speech promoting Vascepa to healthcare professionals beyond the use approved by the FDA, with specific reference to patient studies and Amarin's successful ANCHOR study of Vascepa in patients with persistently high triglycerides after statin therapy, and that such speech may not form the basis of a misbranding action under the Federal Food and Drug Cosmetic Act.

While not the same as a label change, and specifically not an indication for the use of Vascepa in patients with high triglycerides, between 200 and 499 milligrams per deciliter, the court declaration allows promotion of the FDA-reviewed and agreed-upon effects of Vascepa, demonstrated in the Phase III ANCHOR clinical trial, and use of peer-reviewed scientific publications that present the current state of scientific research related to the potential of Vascepa to reduce the risk of cardiovascular disease.

We believe that this federal court decision and resulting education about the ANCHOR results will lead to improved patient care, as it opens more direct and effective paths to communication truthful and non-misleading information. With accurate information readily available, healthcare professionals will be better able to decide for themselves how best to choose among available treatment options for their patients.

As a result, beginning in mid-August, the Amarin and Kowa sales forces began educating select healthcare professionals on the lipid and lipoprotein results of the ANCHOR trial in which Vascepa, compared to placebo, improved triglyceride levels, and various other lipid and lipoprotein bio-markers, without increasing LDL cholesterol in statin-treated patients with persistently high triglyceride levels.

This education includes promotion of published data from the ANCHOR study, together with certain disclosures as described by Amarin at the time of the court declaration. We intend to begin promotion of additional relevant data regarding effectively treating patients with high and very high triglycerides after targeted healthcare professionals become more aware of the first set of new data.

While too early to assess the impact of educating physicians regarding ANCHOR trail results, preliminary feedback from healthcare professionals suggests that they appreciate the information and that for most of them the information is completely new.

While promotion of the ANCHOR trial results may have had some positive impact on September prescription levels, the level of such impact is believed to be relatively limited.

We anticipate that some physicians, despite learning the positive ANCHOR results, will be hesitant to prescribe Vascepa due to perceived and, with some payers, real reimbursement issues, associated with off-label drug use.

We're bullish regarding the value of this added data that we're now able to communicate to professionals, but it's too early in the launch of this new data to accurately quantify the future impact of such expanded promotion on Vascepa prescription growth.

For the avoidance of doubt the information we're communicating to healthcare professionals under authority of the court decision is truthful information and great care is being taken to communicate the information fairly so that healthcare professionals are not misled.

For example, FDA has reviewed the efficacy and safety results of our ANCHOR data, and the safety data from ANCHOR is already reflected in our approved label. The FDA confirmed that they have disagreement with the accuracy of the efficacy results reported from this Phase III study.

FDA has emphasized that they have a higher level of proof required for a label change than is relied upon by physicians in their daily practice of medicine.

We also remind you that FDA has strongly urged to complete the REDUCE-IT cardiovascular outcome study, pointing to final REDUCE-IT data as a means to potentially settle FDA's uncertainty on the connection between triglyceride reduction and cardiovascular outcomes in the ANCHOR population, specifically those patients with persistently high triglycerides after statin therapy.

Remember that these patients are often treated by other therapies which have unwanted side effects not associated with Vascepa. However, very few healthcare providers are aware that we're conducting the REDUCE-IT cardiovascular outcome study. Physicians have been asking for this type of information, and we're now able to share this important information with key target providers. In order to ensure fair balance, all such communication includes disclaimers and other steps to ensure that the scientific information communications is truthful and not misleading.

Some investors have asked why we are not immediately promoting to physicians all available truthful covered by the First Amendment court decision. The short answer is that we're focusing on quality over quantity. We'll get to additional information (inaudible), but first we want to ensure that our target physicians understand the top-line ANCHOR trial results. Physicians have a lot on their minds, and if we take a shotgun approach of communicating too much new scientific information to them all at once, they're less likely to remember the information.

Studies show that it takes multiple visits with physicians to get them to understand information and to act on it. During Q4 we intend to begin talking to the target physicians about the next module of data. Again, we're taking a very thoughtful approach to ensure that physicians understand the data we present them.

Of late, there's been increased emphasis on the need to manage LDL cholesterol levels. Vascepa is not a drug intended for LDL management, however Vascepa remains unique among key competitive products in demonstration of Vascepa's ability to lower triglycerides and a host of other lipid measures without increasing LDL cholesterol.

PCSK9 inhibitors have been part of the recent discussion on the value of lowering LDL cholesterol due to their ability to prevent PCSK9 from reducing LDL receptor levels, thereby providing a new means to lower LDL. Few are aware that broadly used lipid-lowering agents such as fenofibrates have been reported in the scientific literature to increase PCSK9 levels. Fenofibrates are generic, and are no actively promoted, but they are widely used, and fenofibrates, like niacin, are no longer labeled for use as add-ons to statin therapy, as of earlier this year.

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So, while there are new injectable therapies to lower blood PCSK9 levels, and subsequently lower LDL-C, clinicians should first make sure to address lifestyle habits and drug therapy that may have an adverse effect on LDL levels. Our experience in the field is that Vascepa works as demonstrated in our trials. We're in the early stages of promoting new and important ANCHOR trial data to select physicians, and we'll be expanding our messaging as we move forward.

Our commercial team looks optimistically at the balance of 2015 and beyond.

I'll now turn the call over to Steve Ketchum, our President of R&D, to provide an R&D update. Steve?

Thank you, Aaron. REDUCE-IT, the first prospective cardiovascular outcome study to evaluate the effect of a 4 gram of a pure EPA prescription Omega-3 in patients who despite statin therapy have elevated triglyceride levels, continues on schedule toward anticipated completion in 2017 and publication of results in 2018. To date, approximately 7,800 patients have been enrolled, representing more than 97% of total targeted patient enrollment.

Completion of REDUCE-IT is event-driven and depends on attainment of 1,612 cumulative patients with documented primary cardiovascular events. The REDUCE-IT cardiovascular event rate continues to track to our expectations for the protocol pre-specified interim efficacy and safety look by the independent data monitoring committee, or DMC, to occur in 2016 upon reaching 50% of the target aggregate number of cardiovascular events.

Given the high thresholds of overwhelming efficacy and safety typically required to be achieved prior to an independent DMC recommending an early stop a large, long-term cardiovascular outcomes trials like REDUCE-IT, management continues to believe that it is most likely that the REDUCE-IT study will run to its completion.

It is most common for large, long-term outcome studies of cardiovascular therapy to not be stopped early. Most cardiovascular outcome studies conducted over the past decade or so have run to completion.

These studies included interim looks by independent DMCs for both efficacy and safety, but were not stopped early. If the REDUCE-IT study is not stopped early in 2016, this should not be a surprise to anyone, and should, in no way, be interpreted to suggest that the study is not positioned for success.

In the REDUCE-IT study, the independent DMC has met in closed session to look at and discuss unblinded safety data on an approximately quarterly basis since study initiation in 2011, and after each such meeting the independent DMC has recommended that the study be continued as planned.

Amarin remains blinded to REDUCE-IT study data. When the independent DMC performs the pre-specified interim look at all available efficacy and safety data in 2016, we anticipate a similar recommendation from the DMC to continue the study as planned.

While Amarin is blinded to the ongoing study results, based on comprehensive review of clinical, epidemiological, and genetic data, Amarin continues to believe that REDUCE-IT is well positioned for success. The results of this important trial could lead to improved medical care for tens of millions of patients.

Recent research findings continue to support the potential benefits of EPA, the active pharmaceutical in gradient in Vascepa. Building on the results of prior retrospective case studies, data from a retrospective Swiss study was presented at the American Society for Preventive Cardiology annual cardiovascular disease prevention conference in August.

This study investigated the real-world effects of switching from EPA plus DHA therapy to EPA-only omega-3 therapy on multiple lipid parameters. Results demonstrated a reduction in both triglycerides and low density lipoprotein cholesterol, or LDL-C levels, in most of these high-risk statin-treated patients.

Data from an ANCHOR trial sub-analysis was presented in August at the Kern lipid conference. This sub-analysis examined the effect of EPA on high-risk statin-treated patients with persistently high triglyceride levels, showing that icosapent ethyl increased EPA in plasma and red blood cells in a linear, dose-dependent fashion consistent with its triglyceride-lowering effect.

These two presentations add to the growing literature on the effects of EPA treatment on high-risk patients with dyslipidemia. Additional study, as is being conducted in the REDUCE-IT cardiovascular outcomes trial, is needed to determine the extent to which, if any, the effects of EPA shown in these studies would have clinically meaningful benefit.

I encourage investors to review the dozens of clinical, epidemiological, and genetic study references on our corporate website, which support our confidence in REDUCE-IT's success.

I will now turn the call over to Mike Farrell, our Vice President of Finance, to comment on Amarin's third quarter 2015 financial results. Mike?

Thank you, Steve. My comments will address our recent financial results. You'll find a more detailed discussion of our results in our 10-Q and press release, issued earlier today.

In Q3 2015 we recognized $21.3 million in net product revenues, representing an increase of 51% compared to net product revenues of $14.1 million in Q3 of 2014.

As previously described, the timing of shipments to wholesalers varies from period to period, however wholesaler inventory levels largely remained flat during Q3 of both 2015 and 2014.

On a year-to-date basis through September 30th, 2015, we recognized $54.6 million in net product revenues, as compared to $37.7 million in the same period in 2014, an increase of 45%. Note that our year-to-date net product revenues through nine months of 2015 exceeded our full-year net product revenues for 2014.

Based on data currently available, we estimate that we will recognize net product revenues of $22.5 million to $24 million in the fourth quarter of 2015, resulting in net product revenues of $77.1 million to $78.6 million for the year ended December 31st, 2015.

This estimate is based on available historical data and trends, and any significant changes in such trends could result in net product revenues that are lower or higher than our estimates.

Vascepa revenue growth remains difficult to predict. We are very early in our promotion following the First Amendment court decision, and patients who might be benefit from Vascepa treatment typically have physician appointments only once a year.

We believe that our product revenues will continue to grow, but that such growth will be variable from quarter to quarter. We believe that we can grow an attractive and sustainable business, based on the current label and promotion of Vascepa, while we look forward to significantly greater growth following assumed REDUCE-IT study success.

Our average net price per capsule sold in Q3 2015 approximated our average net price in Q2 2015.

Cash collections in the sale of Vascepa in the nine months ended September 30th, 2015, were approximately $78.2 million, and all of our customers remain current in their payments.

In addition to Vascepa product revenue, we recognized licensing revenue of $500,000 in the nine months ended September 30th, 2015, related to the Eddingpharm development and commercialization agreement executed in February 2015.

The development process in China continues to progress, consistent with our expectations. Based upon our current estimates, we anticipate approximately $800,000 in licensing revenue will be recognized in aggregate during 2015, including the $500,000 recognized through September of 2015.

Gross margin on product sales during the quarter ended September 30th, 2015, was 65%, as compared to 62% in the third quarter of 2014. Gross margin on net product sales for the nine months ended September 30th, 2015, was 64% as compared to 61% for the same period in 2014.

While our gross margin may fluctuate from quarter to quarter, overall we expect our gross margin percentage to improve as we source lower-cost API.

In Q3, we received initial batches of API from our newest supplier. We anticipate, based on competitive pricing from this supplier, as well as our other suppliers, that gross margin should continue to improve, particularly as we progress through 2016.

During the nine months ended September 30th, 2015, we paid approximately $26 million for supply-related purchases compared to approximately $6 million paid in the same period of the prior year. As a reminder, we began 2014 with in excess of 12 months of inventory on hand, such that a portion was classified as long-term inventory on our balance sheet.

Our SG&A expense in Q3 2015 as $26.7 million, as compared to $19.3 million in Q3 2014, and was $77.5 million in the nine months ended September 30th, 2015, as compared to $60.9 million for the same period in 2014.

The increase in SG&A expenses was primarily driven by an increase in co-promotion expense related to our partnership with Kowa, higher sales and marketing costs, primarily associated with the recent First Amendment litigation decision permitting the Company to promote to healthcare providers truthful and non-misleading information in regards to our ANCHOR clinical trial results, an increase in non-cash stock-based compensation expense, as well as higher legal expenses, primarily associated with our new chemical entity and First Amendment litigation.

During Q3 2015, we initiated expanded marketing programs in order to communicate broader information about Vascepa to healthcare professionals than we have previously communicated, including information about the results of our ANCHOR trial.

Our R&D expenses in Q3 2015 were $13.1 million, as compared to $14.5 million in Q3 2014, and were $37.7 million in the nine months ended September 30th, 2015 as compared to $37.9 million for the same period in 2014. The variance in R&D expenses compared to 2014 was primarily driven by the timing of costs in support of progressing the REDUCE-IT trial, including purchases of clinical trial materials.

Under US GAAP, we reported a net loss of $32.3 million in the third quarter of 2015. Our basic and diluted loss per share in the third quarter of 2015 was $0.18. This net loss included $3.9 million in non-cash share-based compensation expense, and a $200,000 non-cash loss on the change in fair value of derivatives, as well as a $1.6 million charge for a non-cash deemed dividend for accounting purposes.

For the nine months ended September 30th, 2015, we reported a net loss of $127.2 million for a basic and diluted loss per share of $0.71. This net loss included $10.2 million in non-cash share-based compensation expense, a $400,000 non-cash loss on the change in fair value of derivatives, and a $33.9 million charge for non-cash deemed dividends for accounting purposes.

We reported cash and cash equivalents of $119 million at September 30th, 2015, representing a net decrease of $0.5 million from reported cash and cash equivalents of $119.5 million as of December 31st, 2014.

The net change in cash reflects a $15 million up-front payment received in March upon execution of our initial ex-US licensing agreement for Vascepa, as well as net proceeds from convertible preferred issuances of $57.7 million, offset by cash used in operating activities.

Net cash outflows from operations for the nine months ended September 30th, 2015, were $60.1 million as compared to $58.7 million in the same period in 2014.

Cash used for operating activities in the nine months ended September 30th, 2015, included approximately $20 million more for supply purchases than the corresponding period of 2014. As we commenced 2014 with higher-than-needed inventory levels, for reasons previously discussed.

As a result of the timing of certain items, including interest payments, supply purchases, legal costs and REDUCE-IT expenses, we expect continued quarterly variability in cash outflows from operations.

That concludes my comments on Amarin's Q3 financial results. I would now like to take the opportunity to introduce [Kate McNeil] who joined us this week to head up Investor Relations and certain other important areas of communications for Amarin. Kate brings over 15 years of experience in investor relations and public relations, including significant experience in the pharmaceutical industry. We are very excited to have Kate join the team. She's coming up to speed quickly, and we look forward to having her participate in future calls.

I will now turn the call back to John Thero for closing remarks. John?

Thank you, Mike. During Q3, we made important as it relates to each of our organizational priorities, included accelerated revenue growth, on-track execution of REDUCE-IT, and continued management of costs relating in a cash balance of $119 million as of September 30th, 2015.

We remain focused on these priorities, and look forward to the continued implementation of expanded marketing programs in conjunction with the First Amendment opportunity to educate physicians on additional truthful, non-misleading information in regards to the potential benefits of Vascepa.

While we have briefly commented on our continued progress in China via Eddingpharm, I should add that we continue to explore other strategic opportunities, the timing and structure of which are difficult to predict. We're talking with a number of companies in a number of regions of the world. When terms are agreed with one or more of these companies, we'll, of course, let you know.

In the interim, our focus is on what we more directly control, such as REDUCE-IT progress, and the US revenue growth.

With that, we conclude our prepared comments, and we move to open the line to some questions. Operator?

Thank you. (Operator Instructions). Also, we ask that you please limit yourself to two questions to allow for as many as possible. Our first question comes from the line of Shaunak Deepak with Jefferies. Please proceed with your question.

Hey, thanks for taking my questions.

I wanted to know -- I might have missed this on the call -- but are you still on track to complete the enrollment of REDUCE-IT by the end of the year? And also, is it possible to give a little bit more granularity on when you might expect to have the interim update in 2016?

Shaunak, thanks for the questions. This is John. I'll take that. Steve Ketchum's here. If I mess up, he'll, I'm sure, correct me.

With respect to the enrollment, we're about 7,800 of the patients enrolled at this point in time on a target for right around 8,000. Based upon our current trajectory that enrollment should be completed around the end of the year. It varies from week to week how many patients are enrolled. So, is it possible that there could be some spillover into early 2016? Yes, but for the most part we see the enrollment wrapping up here in the relatively near term.

With respect to the timing of the interim look for safety and efficacy in 2016, which I know a number of investors are excited about because they looked at JELIS data and seen a really early divide in that study with respect to the trial, but I do remind people, as Steve has outlined, it is much more common for trials to run themselves to their completion, and our guidance is that REDUCE-IT is most likely to run itself to completion.

The timing of that, at this juncture, is much more dependent on how well the data comes together, and by that, I mean -- and this is not -- this is true for all clinical trials. Pulling the data together and throughout this process of pulling the data together, it's blinded to us, but we -- in the REDUCE-IT study you're operating in 11 countries, 450 sites. Until you pull all the data together, you don't really know if you have all the data, and you put it into the tables and you look at it, and there's sometimes chasing of data around, not to try to manipulate the data in any way, but to make sure you have a complete dataset. And there is variability into how long that takes.

So, at this juncture, we are far enough along with the events to be able to say that, in all likelihood, the interim look will take place in 2016. Whether it's at the low end of the time curve, or the longer end of the time curve, remains to be seen.

So, I can't tell you first half or second half at this point in time, because there really is a lot of variability in there. And, again, this is common for clinical studies.

Jumping forward to the end of the study, assuming it goes that far, we will probably have a better sense of the timing for pulling this data together based upon what see at the interim look. But we've talked about the results -- the trial being completed in 2017, results in 2018

Unlike the interim look where the 50% of the results is likely to occur early enough for us to be able to bandwidth the most likely sort of high and low ranges of timing for pulling the data together and feel comfortable that that's going to most likely occur in 2016, at the end of the study, based upon our current expectations, that last event, 1,612th event, is likely to occur in 2017 in a timeframe where it would be fairly quick for us to pull all that together in 2017, which is why we're saying 2018.

So, hopefully, those comments are useful to you. The -- all of that won't be -- in terms of tightening up guidance relative to the interim look, it's one of those things where you don't actually know how long it's going to take until folks get in there and do it.

For both our ANCHOR and MARINE studies, we had estimates from our CRO of how long that process would take, and, in both cases, it went faster than expected, but those were much smaller studies, and, as you know, all the end points were hit and the safety was terrific, but it was a much, much smaller study with much less data being collected, and while I would love to think that we'll have three for three in that regard, we really just don't know and won't know until the data is collected.

That was helpful, and the other question I had was really on the ANCHOR indication, and I know that it's too early at this stage to really comment specifically on prescription growth attributable to that indication, but I was wondering if you had any early metrics on how physicians or patients might be taking to the potential for using Vascepa in this broader indication?

I think your comment about it being too early is apropos. At this point in time we'd only have the anecdotes. We have anecdotes of physicians expressing to us that they appreciate the information. We have anecdotes of physicians asking us to come back and talk to them further.

We have greater attendance at events where we have physicians speaking to their peers. So, we're seeing -- we're seeing interest, but we -- we haven't yet started market research as to method retention or effect.

We didn't start doing the sort of outreach on this until the second half of August with our co-promotion folks starting slightly after our own team got started. And we are, as Aaron pointed out, taking a very staged approach. We're taking a piece of information and making sure the docs understand that piece, and then we'll move on to another piece.

We are spending a lot of time with physicians to ensure that they understand the information and we're presenting it in a factual and balanced approach, which takes some time to get it right. I will remind folks that this is not an indication. We think that the information that we are communicating is valuable and powerful, and we're optimistic that it's going to have a positive effect in patient treatment, as well as on our script levels, but it isn't quite as direct as marketing a new indication, and, in particular, it doesn't change anything at the payer level.

So, you may remember that we have pretty good formulary coverage. We're covered overall in the formula for over 200 million lives in the US. I think the last report was 130 million lives on tier two. That number's gotten high enough and continues to grow that we haven't provided quarter-to-quarter updates. I think we're beyond that at this point in time.

Similar to predecessor drugs like Lovaza, there's been historically pretty good off-label health -- payer coverage of off-label use. A lot of Lovaza use has been off-label, less so for Vascepa. That may increase here -- is likely to increase here as we move forward, and we need to make sure that physicians are comfortable that they -- that their patients will be reimbursed here on off-label use, and some docs get that right away. Some docs need more comfort, and it does vary from health plan to health plan.

So, there's a lot of education going on. We're encouraged, but it's early, and the short answer is, it really is too early to provide any quantification at this stage. We have provided some guidance to what we think that Q4 revenues might look like, as Mike had articulated. But in the fourth quarter we will have just gotten to the early stages of communicating, essentially our second module of information with the idea of additional information rolling out as we get into 2016, as well.

So, hopefully, those comments are useful.

Thank you. (Operator Instructions). Our next question comes from the line of John Boris with SunTrust. Please proceed with your question.

Thanks for taking the questions. Look, first, since you are in continued settlement discussions with the agency, which runs through December 17th, maybe for Joe Kennedy, can you maybe just shape the framework of what the key issues and/or arguments are. I'm not looking for what your negotiated position is, but what are the key points that you're negotiating with the FDA? Are you asking them to reinstatement the SPA, for example, or something to that degree?

Second, for Aaron, on the promotion of the product, it seems like you've taken a very conservative posture with the sales force in terms of your promotion. When do you incorporate not only ANCHOR but also JELIS into the discussion, which I think Judge Engelmayer allowed you to be able to use both of those points within discussions with physicians?

So, those are my two questions. Thanks.

So, I will have Joe comment on both of those. Let's start with the First Amendment, and then I'll turn things over to Aaron to talk about the promotional piece. Joe?

Right. Thanks, John.

So, the framework for our approach to -- our goals going into the settlement negotiations are essentially to take the win that we achieved at the preliminary declaration point and make that final. That's our primary goal. That ruling was both broad and specific, broad in the sense that it allowed us to speak in a truthful, non-misleading way, which affected the promotion of the Vascepa and the ANCHOR patient populations, and specific, because it declared the ANCHOR data, which -- to which there was no contest from FDA, to be truthful and non-misleading in the context of statements that were part of the litigation that was ultimately announced on August 7th.

So, our goal is to take that preliminary ruling and to make it to final, so, we can continue along the path of promotion of Vascepa to the ANCHOR -- for use in the ANCHOR patient population.

And now, with respect to the broad aspect of the ruling, you're right with regards to the JELIS promotion that broad aspect of the ruling leaves you as enabling us to speak in a truth, non-misleading way to promote Vascepa in a truthful, non-misleading way with respect to data that goes beyond the ANCHOR data, so long as that information is truthful and non-misleading.

And so, with regard to your specific question as to whether we're looking to re-implement the SPA or to get a label expansion, the short answer to that is no. The FDA's taken a lot of regulatory steps to take a level playing field in that regard by taking away indications from fenofibrate products, by taking away indications from niacin products with regard to an add-on to statin, which, in effect, gives us a leg up in our ability to now speak to the use of Vascepa on top of statins.

But I think that answers your question. If not, I'm happy to take a follow-up.

Thanks.

And as part of that -- we do talk about this as being a court-order or declaration. Just for emphasis, there was a lot of input from FDA in this process of getting to what is appropriate disclosure of the ANCHOR data, what are appropriate disclosures along with that, including the FDA asking that we emphasize failed studies of fenofibrates and niacin, which allows emphasis for the fact that those drugs are not -- no longer approved on top of statin therapy.

And, of course, FDA is, very much, encouraging us to complete the REDUCE-IT study as the first study in this space, and lots of reasons to be optimistic about the REDUCE-IT study

With that, let me turn things to Aaron to expand upon our comments about a staged and thoughtful launch of the various modules of information under the First Amendment.

Thanks, John, and thank you, John, for the question. And, as John just mentioned, we continue to take a very staged, thoughtful approach to rolling out First Amendment. We started with ANCHOR. It's just two months in. Our sales force is very enthusiastic, but, as you know, it takes time to get to physicians once, not to mention the multiple times it takes to get them to remember a message, to change behavior, to impact patient care, to get that patients in that are, again, a chronic disease, and it takes time.

With that said, we're very much look forward to getting JELIS out there later on here in Q4. We're prepared to roll that out in the coming weeks. We'll do that in a very balanced, truthful, non-misleading way, as we'll continue to do. There's a lot of good information in JELIS and we're looking forward to getting that out.

Thank you. Mr. Farrell, there are no further questions at this time. I'd like to turn the floor back to you for any final concluding remarks.

Thank you for everybody for joining us today. I know you need to get back to other things and to getting ready for the market to open. We look forward to providing you continued updates on the ongoing progress of Amarin in multiple areas. Thanks again. 'Bye.

Thank you. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.