Q4 2021 Amarin Corporation PLC Earnings Call
Welcome to Amarin Corporation's conference call to discuss its full year and fourth quarter 2021 financial results and operational updates.
Operator: Welcome to Amarin Corporation's conference call to discuss its full year and fourth quarter 2021 financial results and operational. Conference call is being recorded today, March 1st, 2022. I would like to turn the conference call over to Lisa DeFrancesco, Senior Vice President, Investor Relations and Corporate Affairs at Amre. Good morning, everyone, and thank you for joining us.
Conference call is being recorded today March 1st 2022.
I would like to turn the conference call over to Lisa Defrancesco, Senior Vice President Investor Relations and corporate affairs at Amarin.
Good morning, everyone and thank you for joining us.
Lisa DeFrancesco: 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. We may not achieve our goals, carry out our plans or intentions, or meet the expectations disclosed in our forward-looking statements. Actual results or events could differ materially, so you should not place under reliance on these statements. We assume no obligation to update these statements as circumstances change.
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.
Not achieve our goals carry out our plans or intentions or meet the expectations disclosed in our forward looking statements.
Actual results or events could differ materially so you should not place undue reliance on these statements.
Assume no obligation to update these statements or 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 risk factors that could.
Lisa DeFrancesco: 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 agreements that we may enter into, amend, or terminate. For additional information concerning the risk factors that could cause actual results to differ materially, please see the risk factors section of our annual report on Form 10-K for the year ended December 31, 2021, which has been filed with the SEC and is 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 the SIPA.
Cause actual results to differ materially please see the risk factors section of our annual report on Form 10-K for the year ended December 31, 2021 .
<unk> filed with the SEC and is available through the Investor Relations section of our website at Www Dot Ameren Corp Dotcom.
Everyone to read these documents.
This call is intended for investors in Amarin and is not intended to promote the use of Vascepa. An archive of this call will be posted on its website and the Investor Relations section Arena.
Operator: An archive of this call will be posted on Amarin's website in the Investor Relations section. Kareem Mikhail, Amarin's President and Chief Executive Officer, will lead our discussion and Mike Kolb, Amarin's Chief Financial Officer, will provide a more detailed overview of our financial results. After prepared remarks, we will open the call to your questions. I remind you that multiple audiences typically listen to the calls of this nature, including existing investors, potential new investors, employees, current and potential collaborators, and current and potential competitors. As always, in this call, we will attempt to provide constructive information without compromising our competitive and strategic positioning. I will now turn the call over to Kareem Mikhail for review of the business. Kareem?
Kareem Macau, Amyris, President and Chief Executive Officer will lead our discussion in my call everyone's Chief Financial Officer will provide a more detailed overview of our financial results. After prepared remarks, we will open the call to your questions I remind you that multiple audiences typically listen to the calls of this nature, including existing investors potential new.
Investors employees current and potential collaborators and current and potential competitors as always in this call. We will attempt to provide constructive information without compromising our competitive and strategic positioning I will now turn the call over to creamy Kal for review of the business Korean.
Good morning, and thank you all for joining us this morning.
Kareem Mikhail: Good morning, and thank you all for joining us this morning. 2021 was an evolutionary year for Amarin, marked by our transformation to a truly global commercial company. Last August, we outlined our vision for our three-dimensional growth strategy. Breadth or geographic expansion, height representing diversification, and depth or core operational evolution.
'twenty, one was an evolutionary year for amarin.
Marked by our transformation to a truly global commercial company.
Last August we outline our vision for our three dimensional growth strategy.
So geographic expansion height, representing diversification and depth or core operational evolution.
Kareem Mikhail: Our achievements throughout 2021 have laid the groundwork for us to successfully execute this strategy and bring us closer to our goal of bringing the SEPA, the SKEPA and its cardiovascular risk reduction benefits to at-risk patients around the world. First, with our European approval, we became a truly global company with an international footprint. We moved quickly to focus on this greater than a billion dollar, long-term revenue opportunity. With the goal of making the Skapa Cardiovascular Benefits available for as many patients as possible in Europe.
Our achievements throughout 2021 have laid the groundwork for us to successfully execute our strategy and bring us closer to our goal of bringing vascepa skipper and its cardiovascular risk reduction benefits to at risk patients around the world.
First with our European approval, we became a truly global company with an international footprint. We moved quickly to focus on this greater than a 1 billion dollar long term revenue opportunity with the goal of making the skipper cardiovascular benefits available for as many patients as possible in Europe .
Kareem Mikhail: Second, we took actions to adapt to the evolving environment in the U.S. with the introduction of our new go-to-market strategy, which included restructuring the commercial organization and introducing a breadth of new digital capabilities. The result is an optimized organization where we are reaching and doing more with less. And we are already beginning to see some early results of these.
Second we took actions to adapt to the evolving environment in the U S. With the introduction of our new go to market strategy, which included restructuring the commercial organization and introducing a breath of new digital capabilities.
The result is an optimized organization, where do we are reaching and doing more with less and we are already beginning to see some early results of these initiatives.
Kareem Mikhail: Next, we introduced an international strategy and began executing on filings in order to gain approval and launch the SIPA through partners in approximately 20 additional key territories, which we believe represent an additional $1 billion long-term revenue. And lastly, but importantly, we introduced our attention to diversify, including the development of a fixed-dose combination portfolio. I'm pleased with the progress we've made and now let me share some more details. Let me begin with a brief review of our results for the year. As you saw in our press release this morning, we reported Net Total Revenue for the full year of 2021, a $583.2 million, and $144.5 million for the last quarter of 2021.
Next we introduced an international strategy and began executing on filings in order to gain approval and launch of Vascepa through partners and approximately 20 additional key territories, which we believe represent an additional $1 billion long term revenue opportunity.
And lastly, but importantly, we introduced our attention to diversify including the development of a fixed dose combination portfolio.
I'm pleased with the progress we've made and now let me share some more details let.
Kareem Mikhail: The bulk of this revenue continues to be from U.S. product sales of Vesipa. Importantly, we increased profitability in our U.S. Vesipa franchise, and along with our strong balance sheet, this will continue to support our European launch. Turning now to Amarin Progress in the US, where in October 2021, we introduced our go-to-market strategy, which I just mentioned, included the restructure of the commercial organization and the introduction of a series of new digital capabilities.
Let me begin with a brief review of our results for the year as you saw in our press release. This morning, we reported net total revenue for the full year of 2021, a $583 $2 million.
And $144 $5 million for the last quarter of 2021.
The bulk of this revenue continues to be from U S product sales of Vascepa Importantly, we increased profitability in our U S. Vascepa franchise and along with our strong balance sheet. This will continue to support our European launch plans.
Turning now to Amarin progress in the U S where in October 2021, we introduced our go to market strategy, which I just mentioned.
Included the restructure of the commercial organization and the introduction of a series of new digital capabilities.
Kareem Mikhail: Our good-to-market strategy features a three-pronged approach that we believe will drive awareness, adoption, and demand of the US business while providing flexibility to react to new headwinds as we face, As I noted earlier, we are pleased to already be seeing preliminary results from this. First, we are focused on expanding provider engagement. Our new digital omnichannel approach has allowed us to expand our reach and optimize our organization to do more with less.
Our go to market strategy features a three pronged approach that we believe will drive awareness adoption and demand of the U S business, while providing flexibility to react to new head wins as we phase them as.
As I noted earlier, we are pleased to already be seeing preliminary results from these efforts.
We are focused on expanding provider engagement.
Our new digital Omnichannel approach has allowed us to expand our reach and optimize our organization to do more with less we have extended reach to over 150000 staff and prescribers to high frequency customized and impactful messaging regarding the significant benefits of Vascepa.
Kareem Mikhail: We have expanded reach to over 150,000 staff and prescribers through high frequency, customized and impactful messaging regarding the significant benefits of VACIPA for CV risk reduction. We are engaging with prescribers in the ways they want, by utilizing virtual detailing, email campaigns, websites, and medical, digital webinars, social media, and more. While still early days, we are seeing some encouraging slides, including close to 2,000 new prescribers activated nationally. It's important to acknowledge that although there are some encouraging signs, we are not at pre-pandemic levels of engagement with healthcare practitioners. Further, given the significant market disruption, we're not sure that we'll ever go back to those levels of face-to-face engagement.
For CV risk reduction.
We are engaging with prescribers in the ways. They want by utilizing virtual detailing email campaigns websites and medical digital Webinars and social media and more while still early days, we are seeing some encouraging signs, including close to 2000, new prescribers active.
They did nationwide it's important to acknowledge that although there are some encouraging signs we are not at pre pandemic levels of engagement with health care practitioners.
Further given the significant market disruption, we're not sure that will ever go back to those levels of face to face engagement.
Kareem Mikhail: Next, managed care access remains a focus. We have intensified our efforts to remove remaining barriers to the SIPA prescription so that we can improve access to patients with real medical needs. We are working towards stabilizing our volume and demand by focusing on enhancing payers' access. Currently, Amarin has approximately 40% of total commercial and Medicare Part E lives on a weighted average basis with the CEPA as the exclusive IP process. Overall, we were able to improve access for VACIPA for 25% of all commercial lives.
Next managed care access remains a focus we have intensified our efforts to remove remaining barriers to vascepa prescription. So that we can improve access to patients with real medical need we are working towards stabilizing our volume and demand by focusing on enhancing peers axis.
Currently Amarin has approximately 40% of total commercial and Medicare part D lives on a weighted average basis with vascepa as the exclusive IP products.
Overall, we were able to improve access for Vascepa, 425% of all commercial lives and moving forward. There are several important decisions, we are waiting that could significantly and positively impact our coverage this year.
Kareem Mikhail: And moving forward, there are several important decisions we are awaiting that could significantly and positively impact our coverage this year. Finally, we are optimizing fulfillment of the SIPA prescription for CV risk production. We continue to face increased genetic competition, where there are now three genetics available on the market beginning in January of this year. We remain focused on driving the SIPA prescriptions for cardiovascular risk reduction, and we are continuing our efforts to educate the market at every level, and particularly at the pharmacy level.
Finally, we are optimizing fulfillment of vascepa prescription for CV risk reduction.
We continue to face increased generic competition, where there are now three genetics available on the market beginning in January of this year, we remain focused on driving vascepa prescriptions for cardiovascular risk reduction and we are continuing our efforts to educate the market at every level and particularly.
The pharmacy level one.
Kareem Mikhail: One example of our effort here is our recently launched VACIPA campaign focused on prior myocardial infarction and stroke patients at a heightened risk of a subsequent event to generate immediate growth acceleration. As communicated earlier, we partnered with BlinkRx in November 2021 to support the fulfillment of our prescription, we are already seeing an impact where we are experiencing accelerated physician uptake and patient prescription fill. The vast majority of patients that fill an IPE prescription in Blink elect to receive branded Vaseepa due to its lower copay cost compared to generic alternatives.
One example of our effort here is our recently launched Vascepa campaign focused on private or myocardial infarction and stroke patients at a heightened risk of a subsequent event to generate immediate growth acceleration.
As communicated earlier, we partnered with Blink Rx in November 2021 to support the fulfillment of our prescriptions. We are already seeing an impact when we are experiencing accelerated physician uptake and patient prescription fills.
The vast majority of patients that Phil and IEP prescription in blink elect to receive branded vascepa due to its lower coffee cost compared to generic alternatives.
Kareem Mikhail: Most patients also elect to auto refill, to aid continuity of treatment with the branded. Partnerships, such as BlinkRx, where compensation to our partner is based on actual results, are a priority and a key focus of our marketing efforts. We're also examining all of our resources, and ensuring that our investments are profitable and aligned with our strategy. And as a result, around 50 percent of our U.S. marketing investment is now volume driven.
Most patients also elect to auto refill to eighth continuing T of treatment with branded Vascepa.
Partnerships, such as Blink Rx, where compensation to our partner is based on actual results at a priority and a key focus of our marketing effort would also examining all of our resources and ensuring that our investments are profitable and aligned with our strategy and as a result around <unk>.
50% of our U S marketing investment is now volume driven.
Kareem Mikhail: While we expect market conditions will vary dynamically, depending on a number of factors, our focus is on our ability to maintain a positive contribution margin. As you all know, the U.S. strategy remains critical to Amarin's overall growth strategy as U.S. business profits are helping to support our European expansion, international growth, and investment in our pipeline. Before we move to Europe, I want to provide a brief update with regards to the district court decision on the Amarin v. Hikma and HealthNet case.
While we expect market conditions will vary dynamically depending on a number of factors are focuses on our ability to maintain a positive contribution margin as you all know the U S strategy remains critical to Amarin overall growth strategy as U S business profits are helping to support our European <unk>.
Spansion international growth and investment in our pipeline.
Before we move to Europe , I want to provide a brief update with regards to the district court decision on the Amazon versus Hikma and health net case.
Kareem Mikhail: We are pleased that the court found that there exists sufficient basis and factual questions concerning inducement of infringement for the litigation to proceed against health, Amarin will continue to vigorously pursue its case against healthcare. While we are disappointed in the ruling on Hikmas motion to dismiss, we recognize that this is an evolving area of the law. Amarin intends to appeal of the district's court decision.
We are pleased that the court found that data exists sufficient basis and factual questions concerning inducement of infringement for the litigation to proceed against health net.
<unk> will continue to vigorously pursue its case against health net.
While we are disappointed in the ruling on <unk> motion to dismiss we recognize that this is an evolving area of the law.
<unk> intends to appeal of the district Court decision Amarin believes that its patents are being infringed upon and will continue to fight to protect the company's intellectual property.
Kareem Mikhail: Amarin believes that its patents are being infringed upon and will continue to fight to protect the company's intellectual property. Turning now to our progress in Europe, which we believe is a greater-than-a-billion-dollar long-term revenue opportunity for America. As I mentioned earlier, following European regulatory approval, we made significant progress developing and executing a market access strategy with the goal of launching VASCEPA in Europe in a strategic, sequenced manner, aiming at optimizing both price and patient population.
Turning now to our progress in Europe , which we believe is a greater than $1 billion long term revenue opportunity for MRV as.
As I mentioned earlier following the European regulatory approval, we made significant progress developing and executing our market access strategy with the goal of launching about skipper in Europe in the strategic sequenced manner aiming at optimizing both price and patient population.
Kareem Mikhail: We started with an ambitious plan to submit reimbursement dossiers in 10 countries, and we achieved that goal ahead of schedule as we announced in our third quarter report. Moving forward, there will be a lot of information as we file in additional countries and enter reimbursement negotiation in key markets where we have already submitted those. As a result, I think it's important to take this opportunity to review the process for commercializing a product in most markets in Europe. Although its market has its own differences, there are five major steps.
We started with an ambitious plan to submit reimbursement dossiers in 10 countries and we achieved that goal ahead of schedule as we announced in our third quarter report.
Moving forward there will be a lot of information as we file in additional countries and enter reimbursement negotiation in key markets, where we have already submitted dossiers as a result, I think it's important to take this opportunity to review the process for commercializing a product in most markets in Europe .
Although its market has its own differences that are five major steps step one.
Kareem Mikhail: Step 1, is, of course, the regulatory approvals in the EU and UK. It's important to achieve a broad label language that represents the full patient population potential, as this is the key for the next negotiating step. We accomplished this in 2021, and with a patient population that is fully reflective of the REDUCE-IT study. Step two involves the development and filing of market access reimbursement, which are submitted on a country by country basis.
Is of course, the regulatory approvals in the EU and UK, it's important to achieve a broad label language that represents the full patient population potential as this is sticky for the next negotiating steps.
We accomplished this in 2021 and with a patient population that is fully reflective of the reduce it study.
Step two involves the development and filing of market access reimbursement dossiers, which are submitted on a country by country basis.
Kareem Mikhail: These dossiers include the summary of the scientific evidence supporting the benefits of the product and datasets defining the patient population that can benefit from Vescapa in the specific country. Step three, this begins with a scientific evidence assessment or clinical review, which involves reviewing study results, expert opinions in each market, assessing treatment benefits, and determining the eligible patient population for reimbursement. Once these reviews are complete, they render an opinion and move on to the next step.
These doses include the summary of the scientific evidence supporting the benefits of the product and data sets defining the patient population that can benefit from vascepa in this specific country.
Step three this begins with the scientific evidence assessment or clinical review, which involves reviewing study results experts opinions in each market assessing treatment benefits and determining the eligible patient population for reimbursement.
Once these reviews are complete they render an opinion and move onto the next step.
Kareem Mikhail: Step four is price negotiation. At this stage, you introduce pharmacoeconomic data and assess. Other factors and variables are also considered involve the overall budget impact and macroeconomic environment to arrive at a price for reimbursement.
Step four is price negotiations at this stage you introduced for macroeconomic data and assessments. Other factors and variables are also considered involves the overall budget impact and macroeconomic environment to arrive at a price for reimbursement.
Kareem Mikhail: Finally, step five, you conclude the process with official price publication and loss. The one exception to this process I just described is Germany, where we launched in mid-September 2021. In order to provide patients with access to new medicine, in Germany, new pharmaceuticals are given one year on the market with reimbursement as the market access process is underway. During this first declared pricing year, it's important to maximize the market opportunity, but also ensure that investments are flexible and adaptable to changing market conditions that can occur as part of the ongoing negotiation process.
Finally step five you conclude the process with official price publication and launch the one exception to this process I. Just described is Germany, where we launched in mid September 2021 in order to provide patients with access to new medicine in Germany, New Pharmaceuticals are given one year on the.
<unk> with reimbursement has the market access process is underway.
During this first declared pricing here, it's important to maximize the market opportunity, but also ensure that investments are flexible and adaptable to changing market conditions that can occur as part of the ongoing negotiation process.
Kareem Mikhail: Every market also has its own nuances that play a role in the ultimate outcome. These include environmental factors and local market conditions that impact a company's ability to attain reimbursement, receive optimal pricing, maintain timelines, obtain target patient inclusion, and achieve adoption in a given market. That is why it's important to balance the level of investment with the right timing and probability of success. Investing too early is waste, While investing too late can adversely impact the outcome, our team has taken great care to thoughtfully build and assess each market prior to making decisions on when and where to invest.
Every market also has its own nuances that play a role in the ultimate outcome. These include environmental factors and local market conditions that impact our company's ability to obtain reimbursement receive optimal pricing maintain timelines obtain target patient inclusion and achieve adoption.
In a given market.
That is why it's important to balance the level of investment with the right timing and probability of success.
Investing too early is wasteful, while investing to late can adversely impact the outcome. Our team has taken great care to thoughtfully build NSS each market prior to making decision on when and where to invest.
It can take many months to work through the reimbursement and price negotiation processes. This is confounded by the fact that certain parts or opinions army public at different times and different formats, depending on the market, making it difficult to know the specific outcome until doctor.
Kareem Mikhail: It can take many months to work through the reimbursement and price negotiation process. This is confounded by the fact that certain parts or opinions are made public at different times and through different formats depending on the market, making it difficult to know the specific outcome until the process is complete.
<unk> is complete this is part of the dynamic nature of European reimbursement and is anticipated. It's important during this process to reiterate that our filing and reimbursement process. Thus far is going largely according to plan. We have assembled a strong talented team that is working through.
Kareem Mikhail: This is part of the dynamic nature of European reimbursement and is anticipated. It's important during this process to reiterate that our filing and reimbursement process thus far is going largely according to plan. We have assembled a strong talented team that is working through these various stages in parallel in several markets and we feel confident of a favorable outcome. As you know, we completed market access dossier submissions in 10 countries. Germany, UK, Italy, France, Spain, Denmark, Sweden, Finland, Norway, and the Netherlands, and are now in the active pricing negotiation phase in a number of these markets.
These various stages in parallel in several markets and we feel confident of a favorable outcome.
As you know we completed market access dossiers submissions in 10 countries, Germany, U K, Italy, France, Spain, Denmark, Sweden, Finland, Norway, and the Netherlands.
<unk> are now in the active pricing negotiation phase in a number of these markets. This process will take several months to complete I am pleased overall with the way. These negotiations are proceeding in line with our plan to launch in up to six countries in 2022 and I remain confident in our.
Kareem Mikhail: This process will take several months to complete. I am pleased overall with the way these negotiations are proceeding in line with our plan to launch in up to six countries in 2022, and I remain confident in our $1 billion plus opportunity in Europe. In Central and Eastern European countries, we are actively negotiating partnerships to bring VASCEPA to various countries via marketing and distribution agreements with partners who have established infrastructure in such markets.
$1 billion plus opportunity in Europe .
In central and Eastern European countries, we are actively negotiating partnerships to bring basket to various countries via marketing and distribution agreements with partners, who have established infrastructure in such markets. We look forward to reaching agreements later this year and to launch subsequently in <unk>.
Kareem Mikhail: We look forward to reaching agreements later this year and to launch subsequently in December. Moving on to our progress advancing into other international markets, which we consider everything outside of Europe and the U.S. In the fourth quarter of 2021, we introduced our strategy to bring the cardioprotective benefits of the CIPA VASCEPA to 20 additional markets over the next three years. In 2022, our goal is to submit regulatory filings and obtain product approval in up to six countries.
Margins.
Moving onto our progress advancing into other international markets, which we consider everything outside of Europe and the U S.
In the fourth quarter of 2021, we introduced our strategy to bring the cardio protective benefits of Vascepa, let's skip out to 20 additional markets over the next three years in 2022, our goal is to submit regulatory filings and obtain product approval and up to six countries.
Kareem Mikhail: I am pleased to announce that we have filed and received confirmations that our filings have been accepted for regulatory reviews in Australia and Israel. After careful evaluation, we have made the decision to seek partners in all of these international markets, and that process is underway now. We believe this opportunity represents the potential of an additional $1 billion in revenue. Now, an update on the already partnered international territories, China, Middle East, North Africa and Canada. In China, our partner Edding Farm continues to expect to receive approval of a SIPA in mainland China and Hong Kong by the end of 2022.
I am pleased to announce that we have filed and received confirmations that our filings have been accepted for regulatory reviews in Australia and Israel.
After careful evaluation, we have made the decision to seek partners in all of these international markets and that process is underway now we believe this opportunity represents the potential of an additional $1 billion in revenue.
Now an update on the already partners International territories, China, Middle East North Africa, and Canada in.
In China, our partner, adding farm continues to expect to receive approval of Vascepa in mainland, China and Hong Kong by the end of 2022.
Kareem Mikhail: China is a significant market opportunity and we continue to work hard with our partner to be ready to launch. In the Middle East, North Africa, we received regulatory approval and reimbursement are in the process of launching in several markets. We have previously shared the co-promotion agreement between HLS, our partner in Canada, with Pfizer that was initiated in the fall of 2021. This collaboration represents a further validation of VASIPA and the importance of the reduced data to cardiovascular medicines worldwide.
China is a significant market opportunity and we continue to work hard with our partner to be ready to launch.
In the Middle East North Africa, we received regulatory approval and reimbursement are in the process of launching in several markets.
We have previously shared the co promotion agreement between <unk>, our partner in Canada with Pfizer that was initiated in the fall of 2021.
This collaboration represents a further validation of vascepa and the importance of the reduce it data to cardiovascular medicines worldwide. We look forward to sharing more details on this partnership in 2022.
Kareem Mikhail: We look forward to sharing more details on this partnership in 2021. Looking ahead to international expansion, in 2023, we plan to seek approval in up to nine additional countries, and in 2024, we expect regulatory approval filings in the remaining five countries we targeted. These filings will all be supported by the long-term cardiovascular outcome data from the landmark reduced study, along with the FDA and EMEA approvals of the CIPA-VASCEPA for the cardiovascular risk reduction indication.
Looking ahead to the international expansion in 2023, we plan to seek approval and up to nine additional countries and in 2024, we expect to complete regulatory approval filings and the remaining five countries we targeted.
These filings will all be supported by the long term cardiovascular outcome data from the landmark reduce it study along with the FDA and EMEA approvals of Vascepa, the skipper for the cardiovascular risk reduction indication.
Finally, let me share some perspective on our thoughts around diversification the high dimension of our global strategy. In addition to our geographic expansion, where you can see we are making great progress.
Kareem Mikhail: Finally, let me share some perspective on our thoughts around diversification, the high dimension of our global strategy, in addition to our geographic expansion, where you can see we are making great progress. We also announced our plans for life cycle management of our recipe of a scape-asset with the development of a six-dose combination portfolio. The medical rationale is key to drive the development of a fixed-dose combination in cardiovascular disease.
We also announced our plans for lifecycle management of our Vascepa skip asset with the development of a fixed dose combination portfolio.
The medical rationale is key to drive the development of the fixed dose combination in cardiovascular disease.
Kareem Mikhail: Combining multiple prophylactic agents for cardiovascular disease into one pill was proposed by the WHO since 2002 to increase adherence and adequate dosing. In the lipid-specific context, the European Society of Cardiology Working Group on Cardiovascular Pharmacotherapy has recommended the use of fixed-dose lipid-lowering combination drugs to increase adherence. In patients at very high risk, such as those with a history of a cardiovascular event, the group recommends initiation of fixed-dose combination treatment immediately after the event.
Combining multiple prophylactic agents for cardiovascular disease into one field was proposed by the WH shows since 2002 to increase adherence and adequate dosing.
In the lipid specific context, the European Society of Cardiology working group on cardiovascular Michael therapy has recommended the use of fixed dose lipid lowering combination drugs to increase adherence.
In patients at very high risk such as those with a history of a cardiovascular event. The group recommend initiation of fixed dose combination treatment immediately after the event. The rationale for this recommendation is that immediate combination therapy may avoid potential barriers related to the multiple visits needed for.
Kareem Mikhail: The rationale for this recommendation is that immediate combination therapy may avoid potential barriers related to the multiple visits needed for treatment intensification. For the patients, fixed-dose combination therapy can improve adherence as evidenced by studies performed in both Europe and the U.S. With improvements in adherence and lower number of healthcare provider visits, a fixed-dose combination therapy has the potential to improve clinical outcomes, including evidence of improvement in biomarker levels in patients.
Treatment intensification.
For the patients fixed dose combination therapy can improve adherence as evidenced by studies performed in both Europe and the U S with improvements in adherence and lower number of health care provider visits at fixed dose combination therapy has the potential to improve clinical outcomes, including evidence of.
<unk> and biomarker levels in patients.
Kareem Mikhail: This will also translate in enhanced therapy with reduced bill burden and significant convenience factor as many high-risk cardiovascular patients have other comorbidities and therefore multiple medications. Commercially, this allows us to maximize the investment made into the reduced study where IPE was used on top of a statin by offering the benefits of Vasepa-Vaskepa in a broad portfolio of products. We look forward to sharing more on the development of our fixed-dose combination portfolio as we move further into the development process, potentially later. We also remain committed to evaluating opportunities outside of Amarin to leverage our capabilities and diversify our portfolio while ensuring we remain financially strong. This remains a core area of focus for our team.
This will also translate and enhanced therapy with the reduced build burden and significant convenience factor as many high risk cardiovascular patients have other comorbidities and therefore multiple medications.
Commercially this allows us to maximize the investment made into the reduce it study.
<unk> was used on top of a statin by offering the benefits of Vascepa skipper and a broad portfolio of products.
I look forward to sharing more on the development of our fixed dose combination portfolio as we move further into the development process potentially later this year.
We also remain committed to evaluating opportunities outside of Amazon to leverage our capabilities and diversify our portfolio, while ensuring we remain financially strong. This remains a core area of focus for our team.
Finally, and before we turn to financial results underlying our growth strategy and our objectives for this year is our commitment to operational excellence, we are continuing to update and strengthen our leadership team and the board.
Kareem Mikhail: Finally, and before we turn to financial results, underlying our growth strategy and our objectives for this year is our commitment to operational excellence. We are continuing to update and strengthen our leadership team and the board. We are focused on making profitable investments in growth with a focus on flexible investments to ensure our ability to adapt to a dynamic environment and achieve our multi-billion dollar global expansion strategy, and we are committed to a strong balance sheet in order to continue to invest in our expansion strategy for the foreseeable. With this overview of our business, let me turn the call to Mike Kalb, our CFO, for a more detailed discussion of our financials.
We are focused on making profitable investments in growth with a focus on flexible investments to ensure our ability to adapt to a dynamic environment and achieve our multibillion dollar global expansion strategy.
And we are committed to a strong balance sheet in order to continue to invest in our expansion strategy for the foreseeable future.
With this overview of our business, let me turn the call to Mike Kalb, our CFO for a more.
A detailed discussion of our financials.
Mike.
Mike Kalb: During the fourth quarter of 2021, we reported net total revenue of $144.5 million, a decrease of 14% compared to the fourth quarter of 2020, and $583.2 million for the full year of 2021, a decrease of 5% over full year 2020. During the fourth quarter of 2021, we reported net product revenue of $143.7 million, a decrease of 13% compared to the fourth quarter of 2020, which was largely driven by a decrease of U.S. Visepa sales as a result of the impact of generic products for Visepa's initial indication and the ongoing impact of the COVID-19 pandemic.
Thanks, Karim turning to fourth quarter of 2021, we reported net total revenue of $144 5 million a decrease of 14% compared to the fourth quarter of 2020.
And $583 $2 million for the full year of 2021.
So 5% over full year 2020.
During the fourth quarter of 2021, we reported net product revenue of $143 7 million.
A decrease of 13% compared to the fourth quarter of 2020, which was largely driven by a decrease of U S. Soup sales as a result of the impact of generic products for Vascepa as an initial indication and the ongoing impact of the COVID-19 pandemic.
Mike Kalb: For the year ended December 31st, 2021, we achieved $580.3 million of net product revenue, a decrease of 4% over the same period in 2020, which was largely driven by a decrease in U.S. Visepa sales of approximately $20.2 million, as well as a decrease in Visepa sales to our partners outside of the U.S. of approximately $6.5 million. The patient need for Vancepa in the U.S. remains solid, and we are beginning to see encouraging signs that the U.S. go to market strategy will continue to result in market expense.
For the year ended December 31, 2021, we achieved $583 million of net product revenue decrease of 4% over the same period in 2020.
It was largely driven by a decrease in U S. Vascepa sales of approximately $22 million as well as a decrease in vascepa sales to our partners outside of the U S of approximately $6 5 million.
The patient need for Vascepa in the U S remains solid and we are beginning to see encouraging signs that the U S go to market strategy.
Many of the results and market expansion.
Mike Kalb: The U.S. business has continued to be profitable from a contribution margin perspective, meaning gross profit less sales and marketing related. Fourth Quarter and continues to provide support for the expansion into Europe and other geographies around the world. During the fourth quarter of 2021, we reported operating expenses of $97.7 million, a decrease of 22% compared to the fourth quarter of 2020, and $451.4 million for the 12 months of 2021, a decrease of 10% over the same period of 2020.
<unk> business has continued to be profitable from a contribution margin perspective, meaning gross profit less sales and marketing related expenses.
Fourth quarter and continues to provide support for the expansion into Europe and other geographies around the world.
During the fourth quarter of 2021, we reported operating expenses of 97 7 million a decrease of 22% compared to the fourth quarter of 2020 and $451 million for the 12 months of 2021, a decrease of 10% over the same period of 2020.
Mike Kalb: The decrease is related to the implementation of our go-to-market strategy in the U.S., including optimizing our sales force and increasing our reach through digital platforms. As part of our go-to-market strategy, we have increased the variability of certain of our U.S. marketing expenses, which are tied to sales volume. This was partially offset by our investments in growth and expansion in Europe and other markets outside of the U.S. We also experienced a one-time charge of $13.7 million related to the implementation of our go-to-market strategy for the U.S. Under U.S. GAAP, Amarin reported net income of $7.7 million for 2021, or basic and diluted earnings per share, 2 cents.
The decrease is related to the implementation of our go to market strategy in the U S, including optimizing our sales force and increasing our reach through digital platforms.
As part of our go to market strategy, we have increased the variability of certain of our U S marketing expenses, which are tied to sales volume.
This was partially offset by our investments in growth and expansion in Europe and other markets outside of the U S.
We also experienced a one time charge of $13 $7 million related to the implementation of our go to market strategy for the U S.
Under U S GAAP.
Reported net income of $7 $7 million for 2021 basic and diluted earnings per share of <unk>.
Mike Kalb: Absent the reversal of certain non-cash charges, we were approximately break-even for 2021. I think this is particularly noteworthy as we were able to achieve this with our continued disciplined expense management and as a result of the implementation of our go-to-market strategy despite the decrease in our product cost. However, due to the variability of spend related to these initiatives, our growth strategy in Europe and around the world, and our fixed-dose combination research, and develop initiatives. It is uncertain whether such results can be expected in 2022.
Absent the reversal of certain noncash charges, we were approximately breakeven for 2021.
I think this is particularly noteworthy as we were able to achieve this with our continued disciplined expense management and as a result of the implementation of our go to market strategy. Despite the decrease in our product revenue.
However, due to the variability of spend related to these initiatives our growth strategy in Europe and around the world and our fixed dose combination of research and.
Developing initiatives it is uncertain, whether such results can be expected in 2022.
Mike Kalb: We continue to monitor the ongoing global supply chain issues, which are resulting in inventory supply shortages for numerous companies and products. We believe we have and are maintaining adequate supply to meet the expected global demand, including our global expansion plans and pipeline advance, as of December 31st, 2021. Amarin Reported Aggregate Cash and Investments, $489.1 million consisting of cash and cash equivalents of $219.5 million and liquid short-term and long-term investments of $234.7 million and $35 million in, We believe our current available cash and resources including U.S. profitability are sufficient to continue to support the launch of the SCEPA successfully throughout Europe and in other international countries throughout the world. With that financial overview, I will now turn the call back to Kareem for closing remarks. Kareem?
We continue to monitor the ongoing global supply chain issues, which are resulting in inventory supply shortages for numerous companies and products.
We believe we haven't done and maintaining adequate supply to meet the expected global demand, including our global expansion plans and pipeline advancements.
As of December 31, 2021.
Then reported aggregate cash and investments.
$489 $1 million, consisting of cash and cash equivalents of $219 $5 million and liquid short term and long term investments of $234 $7 million.
$35 million respectively.
We believe our current available cash and resources, including U S profitability are sufficient to continue to support the launch of the scaffold successfully throughout Europe and other international countries throughout the world.
With that financial overview, I will now turn the call back to Craig for closing remarks Crane.
Kareem Mikhail: Thanks Mike for that financial overview. 2022 is a year of execution for Amarin. We have set ambitious goals. We have transformed into a global commercial company. The foundational work we conducted throughout 2021 has us well positioned to execute on our growth strategy across all three key areas for growth in the U.S., Europe, and around the world. Our path forward is clear and we are excited to be advancing those plans as they will bring us closer to realizing our bold vision to stop heart disease from being the leading cause of death worldwide.
Thanks, Mike for that financial overview, 2022 is a year of execution for Amazon, we have set ambitious goals, we have transformed into a global commercial company.
Foundation work, we conducted throughout 2021 has us well positioned to execute on our growth strategy across all three key areas for growth in the U S Europe and around the world.
Our path forward is clear and we are excited to be advancing those plants as they will bring us closer to realizing our bold vision to stop heart disease from being the leading cause of death worldwide.
Kareem Mikhail: With that, operator, we're ready to open the call for questions. Ladies and gentlemen, the floor is now open for questions. If you have any questions or comments, please press star 1 on your phone at this time. We ask that while posing your question, you please pick up your handset if listening on speakerphone to provide optimum sound quality.
With that operator, we're ready to open the call for questions.
Ladies and gentlemen, the floor is now open for questions. If you have any questions or comments. Please press star one on your phone at this time, we ask that while posing your question you. Please pick up your handset Senigon speaker phone to provide optimum sound quality. Please.
Operator: Please hold while we poll for questions. Your first question for today is coming from Michael Yee. Please announce your affiliation, then pose your question. Hi, good morning.
Hold while we poll for questions.
Your first question for today is coming from Michael.
Please announce your affiliation then pose your question.
Georgi Nguyen: This is Georgi Nguyen on the line for Michael E. from Jefferies. And thank you for taking my questions. So two for me.
Hi, Good morning, this is charging and win on the line for Michael <unk> from Jefferies and Thank you for taking my questions.
Georgi Nguyen: First one, thanks for sharing the five steps of European commercialization. So in addition to that, I guess, could you comment on how European launch is evolving? How should we think about the uptake and pricing? And what are the next countries to launch in Europe? And maybe in what order?
So two for me first one thanks for saving the five steps of European commercialization.
In addition to that I guess could you comment on how European launch is evolving how should we think about the uptake and pricing and what are the next countries to launch in Europe , and maybe in what order and second one I believe you've been looking into BD opportunities could you give us some color on the potential to in license a new drug.
Georgi Nguyen: And second one, I believe you've been looking into bidding opportunities. Could you give us some color on the potential to in-license a new drug? Maybe comment on the probability of this in 2022, and in what areas, and what types of products, if possible, and how would you utilize the U.S. sales force?
Maybe comment on the probability of that in 2022 and in what areas and what types of products if possible and how would you utilize the U S sales force. Thank you.
Kareem Mikhail: Thank you. Thank you for your question. Well, let's start with the launch in Europe. So, as we, you know, articulated the process, right? It's a five-step process.
Thank you for your question.
Start with the launch in Europe .
So as we articulate the process right Thats, a five step process, we have achieved.
One which is the regulatory have gone what we've achieved step two which is missing those teeth and now we are somewhere between three and step four which is the clinical assessment and the price negotiations and the two are actually truly linked to one another so you'll go back and forth.
Kareem Mikhail: We have achieved, you know, step one, which is the regulatory approval. We've achieved step two, which is submitting of the doses. And now we are somewhere between step three and step four, which is the clinical assessment and the price negotiations and the two are actually truly linked to one another. So you go back and forth. Between the opinion and the price negotiation, it usually starts with a bit of pushback on the opinion and you provide more evidence.
Between the opinion and the price negotiation, usually starts with a bit of a pushback on the opinion.
And you will provide more evidence and negotiation progresses.
At the end to an agreement about the final price now where do we stand today is that we have advanced in multiple countries.
Different speeds and at times, you move a step forward that time, if you will.
Come back one step so with where we stand today is very dynamic. So we're not able to say really which country is going to come first before the other there are countries that have a clock, meaning that tight timelines. For example, the UK is tied to that timeline that many of the nordics countries.
So we can anticipate some of these but still it's big part of.
But there are markets that don't have a clock like Italy, or France, where it's very intuitive.
No problems.
Now as stated we believe we are going largely as planned.
Different countries are going to come into the launch list at different times.
And that's really where we are.
Maybe that was also part of your question an update on the launch I was just going to highlight that just in case. It was also part of your question on Germany.
It launched in Germany would be cleared the price.
We're listed on the electronic prescribing system beginning of October . Unfortunately, we had almost 38 days only on the field before omicron, Germany, very hard and we had to pull out our field forces.
Today, we're not to be back to normal activity in Germany, we still have 25% target audience in Germany, not accessible and will not be accessible before the second quarter. So we are definitely working hard to compensate for the lack of activity, but that's where we stand on that one now on the <unk>.
Kareem Mikhail: And as the negotiation progresses, you really come at the end to an agreement about the final price. Now, what do we stand today is that we have advanced in multiple countries, you know, on different speeds. And at times, you move a step forward. At times, you come back on steps.
Kareem Mikhail: So when we stand today, it's very dynamic. So we're not able to say, really, which country is going to come first before the other? There are countries that have a clock, meaning they're tied to a timeline.
Kareem Mikhail: For example, the UK is tied to a timeline. Many of the Nordics countries are tied to a timeline. So we can anticipate some of these, but still it's big part of the negotiation, but there are markets that don't have a clock like Italy or France, where, you know, it's very iterative as a problem. Up to now, as stated, we believe we are going largely as planned, you know, different countries are going to come into the launch list at different times. And that's really where we are.
Sure.
Kareem Mikhail: Maybe that was also part of your question and of this on the launch. I'm just going to highlight that just in case it was also part of your question on Germany. We did launch in Germany.
This development and diversification, we've already announced.
Kareem Mikhail: We declared price. We were listed on the electronic prescribing system beginning of October. Unfortunately, we had almost 38 days only on the field before Omicron has Germany very hard, and we had to pull out our field forces.
You know that we started the development of a fixed dose combination.
And Thats, an important step in diversifying the portfolio.
Kareem Mikhail: Until today, we're not really back to normal activity in Germany. We still have 25% of the target audience in Germany that is not accessible and will not be accessible before, you know, the second quarter. So we're definitely working hard to compensate for this lack of activity, but that's where we stand on that one. Now, on the question of business development and diversification, we've already announced that we started the development of a fixed dose combination.
The same time, we said we're still open for opportunities.
Bruce if I within the cardio metabolic space, having said that we're very thoughtful about what assets do we need and the focus is very much on commercial assets in the U S, where we have a robust structure and when we are ready to take on additional product responsibility in this space.
Kareem Mikhail: At the same time, we said we're still open for opportunities to diversify within the cardio metabolic space, having said that we're very thoughtful about what assets do we need. And the focus is very much on commercial assets in the US where we have a robust structure and where we are ready to take on additional product responsibility in the space. In Europe, it's not a priority because we are very busy with the launch, but if an opportunity comes up, we're not going to say no, but these are really our priorities in terms of business development. Thank you. Thanks. That's very helpful.
Europe , it's not a priority because we are very busy with the launch, but if an opportunity comes up we're not going to say no. But these are really our priorities in terms of business development.
Thank you. Thanks, that's very helpful. Thank you.
Operator: Thank you. Your next question is coming from Jessica Fye. Please announce your affiliation, then pose your question. Hey, this is Nick on for Jessica Fye.
Your next question is coming from Jessica Fye. Please announce your affiliation then pose your question.
Nick: Thanks for taking our questions. So maybe just building on that last question, recognizing that you're still building access, kind of when can we expect any potential inflection in the European launch? You know, for example, is there a time when you feel comfortable or confident European sales would exceed $100 million? And also just to confirm, what were the European sales in 4Q? And kind of looking forward, when do you think we can expect a breakout of European sales? Thanks. Thank you. Thanks, Nikon.
Hey, this is Nick on for Jessica Fye, Thanks for taking our questions. So maybe just building on that last question recognizing that you're still building access kind of when can we expect any potential inflection in the European launch for example through time and you feel comfortable or confident European sales will exceed $100 million and also just to confirm.
But what were the European sales in four Q and kind of looking forward. When do you think we can expect.
Breakout of European sales. Thanks.
Kareem Mikhail: So, you know, back to European launch and European inflection. You know, obviously, in Europe, we are launching with a very different foundation than what we had in the U.S. What we had in the U.S. is really, you know, four or five years of almost pre-marketing of the indication of very high triglycerides. And then when we were launching the cardiovascular risk reduction, the product was known, the company was known. So, the uptake is obviously very strong. In Europe, we have a different situation.
Okay.
So you know.
Back to European launch in European Inflections.
In Europe , we are launching with a very different foundation than what we had in the U S. What we had in the U S.
It is really.
Four five years of almost pre marketing.
Vacation of very high Triglyceride, and then when we were launching the cardiovascular risk reduction, but product was known the company was known so the peak is obviously very strong in Europe , we have a different situation.
Kareem Mikhail: You know, the company is new to Europe and the product is also very new. So, it is going to take a bit more time to build that level of awareness adoption. Having said that, we're confident because of the evidence that we have.
The company's new to Europe , and the product is also fairly new so it didn't kind of dig a bit more time to be able to tackle.
Level of awareness adoption, having said that we are confident because of the evidence that we have it is rare in Europe .
Kareem Mikhail: It is rare in Europe that you actually launch with outcome data. Now, true inflection will happen usually for a cardiometabolic product, usually to, two to three, you know, two to three quarters after, you know, actual activity, especially, you know, now, Germany is a different case, because you actually launch really without pre marketing. So their uptake is usually slower.
We launched with outcomes data now truly inflection, we didnt happen, usually cardio metabolic products usually two.
Two to three.
Two to three quarters after the actual activity.
Especially now in Germany.
Because you actually launch.
But even without pre marketing.
Uptake is usually slower, but that's really where we stand on your specific question on you know.
Kareem Mikhail: But that's really where we stand on your specific question on, you know, you know, the revenue coming from Europe, we have 700,000 coming from Europe in our 10k. And again, you know, this was a period with significant disruption for our launch in Germany. And maybe I could just follow up on that.
The revenue coming from Europe , we have 700000 coming from Europe in our 10-K.
Again, you know.
This was a period with significant disruption for our launch in Germany.
Nick: When do you think we can expect to get European sales breakout? I mean, so going forward, we should expect to continue to get European sales breakout, correct? So, you know, as countries, you know, prepare for launch, I mean, you heard us saying we're not going to invest too early because investing too early is wasteful. You know, it's a negotiation, which, you know, let's face it, many even big pharma companies struggle with, okay? So, you know, to go too early and to say we want to be so well prepared so that we have a strong outcome and uptake is really wasteful.
And maybe if I could just follow up on that when do you think we can expect to get European sell breakout I mean, so going forward, we should expect to continue to get European sales break out correct.
So.
Countries, you don't prepare for launch I mean, you heard us, saying, we're not going to invest towards.
Because investing too early it's wasteful.
Negotiation, which let's face it many even big pharma companies struggling okay. So to go to work.
What we saw when preparing so that we have a strong outcome and uptake is really wait until you have to wait until you see the head of the committee holding the pen.
Kareem Mikhail: You have to wait until you see the head of the committee holding the pen to sign to say I'm going to engage in further investment. So, you know, it's going to be a country by country basis situation. Our aim by country is to break even as early as possible after we launch. We're not losing, you know, in terms of investment, but at the same time, we're not going short so that we can also maximize the opportunity of every country launch. Great, thank you so much.
I can say I'm going to engage in further investments so.
Country by country basis situation, our game by country gets to breakeven as early as possible. After we launch would not loading.
In terms of investments.
Same time, we're not going short so that we can also maximize the opportunity of every country launch.
Great. Thank you so much thank you.
Operator: Thank you. Your next question is coming from Yasmin Rahimi. Please announce your affiliation, then pose your question.
Your next question is coming from <unk> Rahimi. Please announce your affiliation then pose your question.
Yasmin Rahimi: Maybe shifting gears to the U.S., my first question is, you know, in your prepared remarks, you noted that there are certain decisions that you're waiting for that could drive greater coverage. What are those decisions?
Good morning team and thank you for your thoughtful prepared remarks, maybe.
Maybe shifting gears to the U S.
My first question is.
On your prepared remarks, you noted that there are certain decisions that you are waiting for that could drive greater coverage. What are those decisions. What do you project coverage to be at the end of 2022 .
Yasmin Rahimi: Would you project coverage to be at the end of 2022? And then the second question is fixated on sort of focusing on the population with MI and stroke, prior MI and stroke. How big is this population and how much do you think it will drive adoption in this population?
And then the second question is fixated on sort of focusing on the population with M I in stroke and.
So how big is this population and how much do you think it will drive adoption in this population and thank you for taking my questions.
Kareem Mikhail: And thank you for taking my question. Thank you, Yasir, for your question. So, you know, on the U.S., we highlighted that managed care access is a very important priority for us. Now, this is a very dynamic situation because your negotiations with each of the PBMs are usually annual, but they change on a quarterly basis if, you know, different events, you know, come up. So, we communicated that we had 40% of the commercial lives and, you know, Medicare Part D on exclusive status at the end of the year.
Thank you for your question so.
The U S. We highlighted that managed care access is a very important priority for us.
This is a very dynamic situation because your negotiation with each of the Pbms are usually annual but they change on a quarterly basis.
And then come up so we communicated that we had 40% of the commercial lives in Medicare part D exclusive status at the end of the year.
Kareem Mikhail: When we said we're expecting other decisions, it was, you know, additional plans that could become exclusive over the next one to two months, which can increase that 40%. So, at this point in time, we cannot speculate at year-end what would this be because you gain some, you lose some.
When we said we would expecting decisions. It was you know additional plans that could become exclusive over the next one to two months, which can increase at 40% at this point in time, we cannot speculate that you had and what would be because you will gain some you lose some its a dynamic situation, but it shows.
Kareem Mikhail: It's a dynamic situation, but it shows, you know, that we are able to be competitive in the marketplace where we stand today. And we believe that we can continue to drive this effort moving forward because when you look at it today, we're still maintaining a significant large portion of the market by being competitive. Now, in terms of the focus on the patient population, the focus on the patient. All right.
We are able to be competitive in the marketplace, where we stand today and we believe that we can continue to drive this effort moving forward because when you look at it today, we are still maintaining a significant large portion of the market by being converted now.
Now in terms of the focus on the patient population the focus on that.
Thank you.
Okay.
Kareem Mikhail: Thank you. Right. It's a product with a very, very large patient population, and we're facing this in the U.S. and we're facing this in Europe. You face a physician, and when you share your label and your indication, it almost is every patient that you treat, more or less. So the more we focus and the more we target the very specific population that will benefit the most from the product, we can drive the urgency to treat, the call for action from the prescriber, and at the same time, a higher adherence and a higher acceptance on the patient level.
Right right.
These are products with a very.
Very large.
Population and we're facing this in the U S.
And we are facing this in Europe .
Mission and when you share your label and indication it at almost every patient.
Less so the more we focus on the more we target those very specific population.
The most from the product.
We can dive deep versions to treat the call for action from the prescriber and at the same time, our higher ideas and a higher acceptance on the patient level.
Kareem Mikhail: So, you know, we don't believe that that's limiting the potential of the product by being so focused. We actually believe that this is going to drive better acceleration, because when you are so diluted, when you are so diluted, and you go in and you try to engage with the physician, it's difficult to get traction.
No.
We don't believe that that's.
We think the potential of the product by by being so focus we actually mean.
Is going to drive better acceleration because when you are so unique.
You'll have so diluted.
<unk> go away that you tied to engage with the physician.
They're getting traction.
Kareem Mikhail: In the U.S., this population, by the way, is somewhere in the 16-17 million patients, so that's also still very, very significant. And if we can get a higher penetration rate from that 16-17 million, then definitely this is going to be a great outcome for us as a product and as a company. Thank you. We have three questions.
Its population by the way, it's somewhere in the 16 17 million patients. So that's also very very significantly I mean, we can get.
Penetration rate from that $16 million to $17 million.
Definitely.
Be a great outcome for us as a product and as a company.
Thank you for your question.
Thank you.
Operator: Thank you. Your next question is coming from Louise Chen. Please announce your affiliation, then pose your question. Hi, thank you. Louise Chen with Cantor.
Your next question is coming from Louise Chen. Please announce your affiliation then pose your question.
Louise Chen: Thanks for taking my questions here. So, first question I had was, how should we think about the U.S. and EU sales shaping up this year? And will sales be up on a total basis year over year?
Hi, Thank you Louise Chen with Cantor. Thanks for taking my questions. Here. So first question I had was how should we think about the U S and EU sales shaping up this year and will sales be up on a total basis year over year and you know how should we think about U S and EU contribution from the mix.
Louise Chen: And how should we think about the U.S. and EU contribution from the mix? And then the second question I have for you is on M&A once again and your business development strategy. Would you consider looking at something more transformational or larger? Or maybe another way to ask this is that you've got a decent size cash balance.
And then second question I have for you is on M&A once again and your business development strategy would you consider looking at something more transformational or larger or maybe another way to ask this is you've got a decent size cash balance what are your key priorities for capital allocation. Thank you.
Louise Chen: What are your key priorities for capital allocation? Thanks, Louise. So, first of all, on revenue, as you know, we have not given guidance, the situation is very dynamic, so today it's very difficult to speculate how the year is going to evolve. You've seen that we're making a lot of effort in the US with our new go-to-market strategy. It's not new anymore, we've implemented it for the last five months and was starting to see results.
Thanks Louise.
So first of all on the revenue as you know we have not given guidance situation is very dynamic. So today very difficult to speculate how the year is going to evolve.
You've seen that we're making a lot of effort in the U S with our new go to market strategy.
The more we can implement that in for the last five months and we're starting to see results and the biggest result out of that is a higher more positive contribution margin.
Louise Chen: And the biggest result out of that is a higher more positive contribution that is very, very critical for the investment and the growth of the company in Europe and, So in terms of investment, we're basically doing our best in the U.S. making sure we maximize the contribution margin and use that in Europe. The revenue in Europe will depend on the sequence of the launches and the, you know, which countries are going to launch first. We know that out of the 10 dossiers we submitted. France, Italy, Spain, Germany, and the UK, so the five bigger European countries, can deliver 65% of the whole European potential.
That is very very critical for the investment in the growth of the company in Europe and elsewhere. So in terms of investment we're basically doing.
In the U S, making sure we maximize the contribution margin and use that in Europe . The revenue in Europe will depend on the sequence of the launches.
Which countries are going to launch first we know that out of the 10 doses we saw mixed.
France and Italy.
Germany, and the UK, so the five major European countries and deliver 65% of the whole European production. So that is definitely an area of focus.
Kareem Mikhail: So that is definitely an area of focus, right? But at the same time, we're also focusing on the other four that we submitted because once you have a positive reimbursement decision in Europe and you anchor a price, that becomes a very significant milestone. But the revenue is going to be built up really based on which country is going to launch when.
The same time, we're also focusing on the other four that we submitted because once you have.
Positive reimbursement decision in Europe , and you haven't got a price that becomes a very significant milestone, but the revenue is going to be built up really based on which countries from a launch win.
Kareem Mikhail: And at this point in time, because we have not given guidance, we cannot really communicate on that. Also important to note that because we are in full-blown price negotiation at this point in time with European agencies, we're trying to be very thoughtful as to what we share about price, patient population, or even timing, because for them timing is very critical, by the way. If they keep us out of the market for an additional quarter, that's less budget impact for them.
And at this point in time, because we have not given guidance, we cannot communicate when you get on that.
Also important to note that.
So we are in full bloom.
Price negotiation at this point in time with the European agencies, we're trying to be very thoughtful as to what we share about price patient population, where even timing.
Cause for them timing is very critical by the way.
Yes.
Out of the market for an additional order that slipped.
No impact for them.
Kareem Mikhail: So we are trying to do our best in a very challenging macroeconomic environment today in Europe. I'm sure everybody is following the news. Already post-pandemic, many countries in Europe were dealing with a significant healthcare budget deficit. Germany is dealing with a €20 billion budget deficit from a healthcare perspective.
You know we are trying to do our best in a very challenging macroeconomic environment today in Europe .
Yeah.
I'm sure everybody's following the news you can post pandemic many countries in Europe .
Significant hemisphere budget deficit, Germany dealing with a 20 billion euro budget deficit from a healthcare perspective. So we you know we are negotiating and we view. These countries are going to come one after the other and we are still committed to have six countries launching in 2022.
Kareem Mikhail: So we are negotiating, and we believe countries are going to come one after the other. And we are still committed to have six countries launching in 2022. Now, in terms of your question on M&A, and I want to be very clear on this one, our priority is to truly launch successfully in Europe. That's the priority number one, and this is where we're getting all our investments, and that's why we're making all these efforts on our cash and our contribution margin from PY. That's priority number one. Then we have already assets in place like our structure in the U.S. that we can best utilize, with commercial assets.
No in terms of your question on M&A I don't want to be very clear on this one our priority is to truly launch successfully.
That's the priority number one and this is where we're getting all our investments and that's why we're making all these efforts on our cash in all of our contribution margin from viewers that's priority number one.
Then we have already assets in place like our structure in the U S that we can best utilize.
Kareem Mikhail: So if we're doing something, priority number one, it's going to be in that space, a commercial asset that, you know, can help us drive more contribution margin, you know, in the US. At the same time, we see that our fixed cost combination decision is very strategic, and it's going to provide a long term revenue additional to what we're getting with the monoproducts. And I'm sure you realize that today, we speak about a fixed dose combination portfolio.
With commercial assets.
Doing something priority number one is going to be in that space.
Commercial asset that you know can help us drive more contribution margin.
And in the U S and that's.
Same time, we see that our fixed dose combination decision is very strategic and it's going to provide a long term revenue additional to what we are getting with the mobile products.
And I'm sure you realize that today, we speak about the fixed dose combination portfolio last time, we spoke about this we said.
Kareem Mikhail: Last time we spoke about this, we said, we're working on a fixed dose combination with a statin and one statin to try. Now we see that there could be more opportunity for development that we are exploring at this stage, because the more we can have, you know, a full portfolio of products that will support the patient demand in terms of cardiovascular risk reduction, right, then the better position we're going to be.
We're working on a fixed dose combination with a statin and <unk>.
One step into right now, we see that there could be more opportunity for development that we are exploring at this stage because the more we can have you know a full portfolio of products that will support the patient demand in terms of cardiovascular risk reduction.
And then the better position, we're going to be.
So this is really that somebody of our thoughts on diversification.
In a nutshell, but thank you for your question.
Kareem Mikhail: So this is really the summary of our thoughts on diversification in a nutshell. But thank you for your question. Your next question for today is coming from Roanna Ruiz. Please announce your affiliation and then pose your question. Yes, thanks. Roanna Ruiz from SVB Lyrinc.
Your next question is.
It's coming from Rowan. Nevertheless, please announce your affiliation then pose your question.
Operator: Thanks for taking the question. So, two for me. First, on the U.S., I noticed you mentioned you activated about 2,000 new prescribers with your new go-to-market strategy. So, I'm a bit curious, what do you think is drawing them to Visepa today, and why were they not aware or prescribing Visepa as much previously? And second question is about your fixed-dose combination with a statin. I was curious if you could just, you know, give us some highlights about what possible next steps are for the program and general timeline. Perfect.
Yes, Thanks ROE on a release from Seb Leerink and thanks for taking the questions. So two for me first on the U S. I noticed you you mentioned you activate it about 2000, new prescribers with your new go to market strategy. So I'm a bit curious when do you think is drawing them to vascepa today and why.
Mike why were they not aware or prescribing vascepa as much previously and second question is about your fixed dose combination with a statin I was curious if you could just give us some highlights about what possible next steps for the program in general timelines.
Roanna Ruiz: Thank you. So, so on the US, we are happy to see earlier results from the go to market strategy and activating 2000 additional prescribers. As a reminder, we were in true full launch mode January 2020 in the US for six weeks when we had to pull all the field force out of the market for the pandemic, and they stayed out of the market for six, seven months until they went back for just a month or two during the fall of 2020, then back again in 2021.
Perfect. Thank you.
So on the U S.
We are happy to see early results from the go to market strategy and activating 2000 additional prescribers.
Reminder, we were in full launch mode January 2020 in the U S.
Four six weeks when we had to pull all the field force out of the market for the pandemic and they stayed out of the market for six seven months until they went back for just a month or two during the fall of 2020.
Back again in 2020 once it has been.
Very very disruptive launch in the U S.
Roanna Ruiz: So this has been a very, very disrupted launch in the US. So it's no surprise that today we're able to activate new prescribers because many of them have not been properly exposed to the product and the message during the launch phase. That's number one.
Is that today.
Moving to activate new prescribers, because many of them have not been properly exposed to the product and the message during the launch phase. So that's number one number two the marketing team already decided to focus on patient population would be.
Kareem Mikhail: Number two, the marketing team already decided to focus on a patient population where the urgency to treat is more significant. And that's attracting physicians who care more about cardiovascular risk reduction. They are not in the biomarker world, I just want to check an LBL or I just want to check a triglyceride.
<unk> is more significant and that's attracting physicians, who care more about cardiovascular risk production. They are not in the biomarker world I just wanted to check in L. B.
Wanted to check in triglyceride.
Kareem Mikhail: I care more about my patient outcome. By talking more cardiovascular risk language, we are able to engage with these physicians at a far higher rate. Also, and more importantly, as we said, we were able to engage digitally with 150,000 physicians, which we were not able to do that even with 750 reps on the field because the door was closed. And no matter how hard they tried, physician access was very limited while their email inboxes are open.
More about my patient outcome by talking more cardiovascular risk language, we are able to engage with these physicians at a far higher rate.
More importantly, as we said we were able to engage digitally with.
<unk> hundred 50000, physicians, which we were not able to do that even with 750 <unk>. That's something that you know because the doors closed then the weapon how automate tried.
<unk> was very limited WILDBERRY email inbox is auto, but and we took advantage of that opportunity and we engage with them and some of them you know click.
Kareem Mikhail: And we took advantage of that opportunity and we engaged with them and some of them clicked and read and came in. Now, this is a very important step, and it should be very balanced. We have not seen at the same time the same increase in death, because we believe it's far more difficult to have an increase in death, especially if you have three genetics on the market, and even if the prescription goes out as the CIPA, there is a likelihood that the prescription gets switched at the pharmacy level for the genetic.
Click.
And gaming.
Right now.
And step.
Balanced we have not seen at the same time, the same increasing debt because we believe it's far more difficult.
And increasing depth, especially if you have three generics on the market and even if the prescription goes out as Vascepa is a lie.
<unk>.
Okay.
Shouldn't get switched.
Pharmacy level the genetics, having said that we are encouraged by these results and our team continues to work very hard and in hand between the field force doing a great job.
Kareem Mikhail: Having said that, we are encouraged by the early results, and our team continues to work very hard, hand-in-hand between the field force, doing a great job. Thank you. So that's really, Now, in terms of the Facebook conversation, let's talk a little bit about this. So, it looks like a lot of people are using Facebook.
Okay.
So that's really.
Okay.
Terms of the fixed.
Let's talk about this so.
Okay.
Kareem Mikhail: Cardium etabolic portfolios that are out there, the ones that sold the most beyond the standard, you will see that many of these products actually had 1, 2, 3, at times 4 fixed those combinations, simply because once you invest it has a billion dollars like what Amarin did for the reduces study, you made that investment and you demonstrated a cardiovascular benefit. So, to stop at one product is really not doing your best in optimizing and maximizing your investments, you would want to bring that value and that investment that you made to many more pieces.
Cardio metabolic portfolios that are out there the ones that sold the most beyond the standard.
Many of these products actually had 123 at times for fixed dose combination simply because once you are investing half a billion dollars of like what I mentioned it for the reduce it study.
And that investment and you've demonstrated.
Cardiovascular benefits so to stop at one product is really not doing your best in optimizing and maximizing your investments you wouldn't want to bring that.
And that investment that you made to many more patients in the way of doing this is to try to put your product with other products have also kind of your vascular outcome benefit to ensure you maximize that for the.
Kareem Mikhail: And the way of doing this is to try to put your product with other products that have also a cardiovascular outcome benefit to ensure you maximize that for the patients. Now, the good news about going down that trial is that your development trackway, your regulatory pathway, doesn't require based on expert opinion for the moment in the US. You do not need additional clinical trials, you really need to have a year of development, a year of stability and a year of filing.
The patients now.
It was about going down that trial that you would get further try anyway, you regulatory pathway doesn't require based on expert opinion for the moment in the U S.
No.
Additional clinical trials, you really need to have a year of development a year of stability in your filings. So it's a three year runway with.
Kareem Mikhail: So, it's a three year runway with reasonably logical investments that are not like an investment in a clinical program of a new outcome study by which you're able to bring an additional product that will be more attractive to many more physicians and patients. Imagine that today, Stanton users in the US have 700,000 prescribers, while, you know, plastic-packed prescribers, because we only had a couple years of launch for cardiovascular risk reduction, or maybe 30 something down, or 30,000.
Reasonably logical investments that are not like an investment.
Clinical program of.
A new outcome study by which you were able to bring in additional products that will be more attractive to many more physicians and patients.
Imagine that two day staffing to users in the U S up 700000 prescribers while.
So I think that prescribers, because we only had a couple of years of launch.
Production or maybe 30 something.
Kareem Mikhail: So, all of a sudden, by putting a Stanton in your product, you appeal to 20 times more physicians who can now prescribe you, because you put a robust Stanton in your facial combination. So, that's really a bit of summary on the fixed sales combination.
So all of a sudden by putting it starting in your products.
Two of 20 times more physicians, who can now prescribe you because you.
Our robust and your fixed dose combination.
That's me.
They have somebody on the fixed dose combination, whereas at the beginning of the process for the moment, we are working to develop one product with one stat that once we see the development here that we are able to successfully deliver our formulation as you know it's a formulation challenge with this product it is not.
Kareem Mikhail: We're at the beginning of the process. For the moment, we are working to develop one product with one Stanton. Once we see after the development year that we are able to successfully deliver a formulation, as you know, that is a true formulation challenge with this product. It is not that simple to put, you know, Zipa with, you know, a solid form product.
That simple to put you know vascepa with.
You know.
A solid a solid form.
Product.
Kareem Mikhail: And then, once we have the development phase, you know, successful, then we are going to think of the development of other products, because once you solve that, it opens the door. And thank you, Roanna, for your questions. Thank you. Your next question for today is coming from Cade Cruz. Please announce your affiliation. Then pose your- Hi guys, this is Cade Cruz on for Paul Choi from Goldman Sachs.
And then once we have the development phase successful then we are going to think of the development of other products because once you've sold that that opens the door.
And thank you everyone for your questions.
Yes.
Your next question for today is coming from Cade crews. Please announce your affiliation then pose your question.
Operator: And our question was, following the recent court decision, we were wondering if you had any update in terms of timeline or next steps that you've already taken as you further pursue litigation. Thank you. Thank you. So on on the legal front, I mean, we, you know, we would definitely, you know, Happy to see that the HealthNet case is continuing and that the court saw that there was enough evidence for this case to continue.
Hi, guys. This is good crews on for Paul Choi from Goldman Sachs and our question was following the recent court decision. We were wondering if you had any update in terms of timeline or next steps that you've already taken.
As you further pursue litigation thank you.
Thank you.
So on the legal front I mean, we you know.
We would definitely you know.
Happy to see that the health medical cases, continuing.
The court so that there was enough evidence for this case to continue it is very important for us.
Operator: It is very important for us that it's HealthNet that it's continuing because at the end of the day, the payer is the final decision makers on which patient gets what. So we're encouraged by this decision. At the same time, on the HICMA side of things, we continue to move forward with our appeal for HICMA. This is an evolving area of the law, as you know, so we continue to follow closely other cases that are similar because we believe they may or may not have an impact on our case, but we will strongly and vigorously continue to defend our patents on all fronts.
No.
Because at the end of the day. The tenure is the final decision makers on which patient gets one. So we're encouraged by you know by this decision at the same time on the Hikma side of things.
We continue to move forward with our appeal.
Or for Hikma.
This is an evolving area of the law as you know so we continue to follow closely other cases that are similar because we believe they may or may not have an impact on our case, but we will strongly and vigorously continue to defend our patents.
On all fronts.
Thank you.
Yes.
Okay.
Kareem Mikhail: Thank you. That is all the time we have for questions today. I would like to turn the floor back over to Lisa for any closing, Thank you, Holly, and thanks for joining us for our fourth quarter and full year earnings call. Please feel free to follow up with us after the call should you have any questions. Have a great day. Thank you ladies and gentlemen, this does conclude today's conference call. You may disconnect your phone lines at this time and have a wonderful day. Thank you for your, Put up a
That is all the time, we have for questions today, I would like to turn the floor back over to Lisa for any closing comments.
Thank you Holly and thank you for joining us.
On our earnings call.
You'll see a follow up.
Cause if you have any questions have a great day.
Thank you ladies and gentlemen, this does conclude today's conference call. You may disconnect. Your phone lines at this time and have a wonderful day. Thank you for your participation.
Put out.