AMARIN CORP PLCUK

Previous wording

We are a pharmaceutical company focused on the commercialization and development of therapeutics to improve cardiovascular, or CV, health and reduce CV risk. Our commercialized product, VASCEPA® (icosapent ethyl) was first approved by the United States, or U.S., Food and Drug Administration, or U.S. FDA, for use as an adjunct to diet to reduce triglyceride, or TG, levels in adult patients with severe (≥500 mg/dL) hypertriglyceridemia, or the MARINE indication and we commercially launched in 2013. On December 13, 2019, the U.S. FDA approved an indication and label expansion for VASCEPA based on the landmark results of our cardiovascular outcomes trial, REDUCE-IT®, or Reduction of Cardiovascular Events with EPA – Intervention Trial. VASCEPA is the first and only drug approved by the U.S. FDA as an adjunct to maximally tolerated statin therapy for reducing persistent cardiovascular risk in select high risk-patients, or the REDUCE-IT indication. On March 26, 2021, the European Commission, or EC, granted approval of the marketing authorization application in the European Union, or EU, for VAZKEPA®, hereinafter along with the U.S. brand name VASCEPA, collectively referred to as VASCEPA, which is the first and only EC approved therapy to reduce cardiovascular risk in high-risk statin-treated patients with elevated TG levels. On April 22, 2021, we announced that we received marketing authorization from the Medicines and Healthcare Products Regulatory Agency, or MHRA, for VAZKEPA in England, Wales and Scotland to reduce cardiovascular risk. On June 1, 2023, we announced that regulatory approval from the National Medical Products Administration, or NMPA, for VASCEPA in Mainland China was received by our partner for the MARINE indication.

Current wording

We are a pharmaceutical company focused on the commercialization and development of therapeutics to improve cardiovascular, or CV, health and reduce CV risk. Our commercialized product, VASCEPA® (icosapent ethyl) was first approved by the United States, or U.S., Food and Drug Administration, or U.S. FDA, for use as an adjunct to diet to reduce triglyceride, or TG, levels in adult patients with severe (≥500 mg/dL) hypertriglyceridemia, or the MARINE indication and we commercially launched in 2013. On December 13, 2019, the U.S. FDA approved an indication and label expansion for VASCEPA based on the landmark results of our cardiovascular outcomes trial, REDUCE-IT®, or Reduction of Cardiovascular Events with EPA – Intervention Trial. VASCEPA is the first and only drug approved by the U.S. FDA as an adjunct to maximally tolerated statin therapy for reducing persistent cardiovascular risk in select high risk-patients, or the REDUCE-IT indication. On March 26, 2021, the European Commission, or EC, granted approval of the marketing authorization application in the European Union, or EU, for VAZKEPA®, hereinafter along with the U.S. brand name VASCEPA, collectively referred to as VASCEPA, which is the first and only EC approved therapy to reduce cardiovascular risk in high-risk statin-treated patients with elevated TG levels. On April 22, 2021, we announced that we received marketing authorization from the Medicines and Healthcare Products Regulatory Agency, or MHRA, for VAZKEPA in England, Wales and Scotland to reduce cardiovascular risk. On June 1, 2023, we announced that regulatory approval from the National Medical Products Administration, or NMPA, for VASCEPA in Mainland China was received by our partner for the MARINE indication and on June 28, 2024 our partner received NMPA approval for VASCEPA in Mainland China for the REDUCE-IT indication.

Previous wording

On July 18, 2023, we announced that we were implementing a new Organizational Restructuring Program, or the ORP, resulting in the elimination and consolidation of certain roles across our organization, both in the U.S. and abroad and representing a reduction of our total employee base by approximately 30%. The ORP was implemented following a review of our business and to better position the organization for a new strategic focus. We expect the ORP will reduce operating costs by approximately $40.0 million annually. Our refocused strategic priorities and restructuring plan focuses on three core areas:

Current wording

On July 18, 2023, we announced that we were implementing a new Organizational Restructuring Program, or the ORP, resulting in the elimination and consolidation of certain roles across our organization, both in the U.S. and abroad and representing a reduction of our total employee base by approximately 30%. The ORP was implemented following a review of our business and to better position the organization for a new strategic focus. The ORP resulted in an operating cost reduction of $50.0 million annually. Our refocused strategic priorities and restructuring plan focuses on three core areas:

Previous wording

In February 2015, we entered into an exclusive agreement with Eddingpharm (Asia) Macao Commercial Offshore Limited, or Edding, to develop and commercialize VASCEPA capsules in what we refer to as the China Territory, consisting of the territories of Mainland China, Hong Kong, Macau and Taiwan. Edding, with our support, conducted a clinical trial of VASCEPA in China, which evaluated the effect of VASCEPA on patients with very high triglyceride levels (≥500 mg/dL). In November 2020, we announced statistically significant topline positive results from this Phase 3 clinical trial of VASCEPA conducted by Edding. The study, which investigated VASCEPA as a treatment for patients with very high triglycerides (≥500 mg/dL), met its primary efficacy endpoint as defined in the clinical trial protocol and demonstrated a safety profile similar to placebo. There were no treatment-related serious adverse events in this study. On February 9, 2021, we announced that the regulatory review processes in Mainland China and Hong Kong had commenced. On February 23, 2022, the Hong Kong Department of Health completed their regulatory evaluation and approved the use of VASCEPA under the REDUCE-IT indication. In Mainland China, the NMPA accepted for review the new drug application for VASCEPA, submitted by Edding, based on the results from the Phase 3 clinical trial and the results from our prior studies of VASCEPA. In China, on October 10, 2022, following the completion of product testing by the China National Institutes for Food and Drug Control, or NIFDC, the final NMPA review of the VASCEPA NDA was initiated. The Company announced on June 1, 2023 that Edding received approval from the NMPA for VASCEPA in Mainland China under the MARINE indication and launched commercially in October 2023. In October 2023, Edding's submission of a regulatory filing to the NMPA for VASCEPA under the REDUCE-IT indication was accepted.

Current wording

In February 2015, we entered into an exclusive agreement with Eddingpharm (Asia) Macao Commercial Offshore Limited, or Edding, to develop and commercialize VASCEPA capsules in what we refer to as the China Territory, consisting of the territories of Mainland China, Hong Kong, Macau and Taiwan. Edding, with our support, conducted a clinical trial of VASCEPA in China, which evaluated the effect of VASCEPA on patients with very high triglyceride levels (≥500 mg/dL). In November 2020, we announced statistically significant topline positive results from this Phase 3 clinical trial of VASCEPA conducted by Edding. The study, which investigated VASCEPA as a treatment for patients with very high triglycerides (≥500 mg/dL), met its primary efficacy endpoint as defined in the clinical trial protocol and demonstrated a safety profile similar to placebo. There were no treatment-related serious adverse events in this study. On February 9, 2021, we announced that the regulatory review processes in Mainland China and Hong Kong had commenced. On February 23, 2022, the Hong Kong Department of Health completed their regulatory evaluation and approved the use of VASCEPA under the REDUCE-IT indication. In Mainland China, the NMPA accepted for review the new drug application for VASCEPA, submitted by Edding, based on the results from the Phase 3 clinical trial and the results from our prior studies of VASCEPA. In Mainland China, on October 10, 2022, following the completion of product testing by the China National Institutes for Food and Drug Control, or NIFDC, the final NMPA review of the VASCEPA NDA was initiated. The Company announced on June 1, 2023 that Edding received approval from the NMPA for VASCEPA in Mainland China under the MARINE indication and launched commercially in October 2023. In October 2023, Edding's submission of a regulatory filing to the NMPA for VASCEPA under the REDUCE-IT indication was accepted. On June 28, 2024, Edding received approval from the NMPA for VASCEPA in Mainland China under the REDUCE-IT indication.

Previous wording

We are in the final year of a three-year plan to submit and obtain regulatory approval in 20 or more additional countries and regions in order to ensure that patients in the top 50 cardiometabolic markets worldwide can benefit from VASCEPA. Through the date of this Quarterly Report, we have filed for regulatory review in 21 countries and regions and have received approval in 14 countries and regions outside of the United States and EMA regulatory approval authority, including in Switzerland, Australia, New Zealand and Israel, under the REDUCE-IT indication. In addition, VAZKEPA has been made available under individual pricing reimbursement in Switzerland.

Current wording

We are in the final year of a three-year plan to submit and obtain regulatory approval in 20 or more additional countries and regions in order to ensure that patients in the top 50 cardiometabolic markets worldwide can benefit from VASCEPA. Through the date of this Quarterly Report, we have filed for regulatory review in 22 countries and regions and have received approval in 15 countries and regions outside of the United States and EMA regulatory approval authority, including in Mainland China, Switzerland, Australia, New Zealand and Israel, under the REDUCE-IT indication. In addition, VAZKEPA has been made available under individual pricing reimbursement in Switzerland.

Previous wording

In February 2023, the Company entered into an agreement with CSL Seqirus, or CSL, to secure pricing and reimbursement, commercialize and distribute VAZKEPA in Australia and New Zealand. In July 2023, the Company entered into an agreement with Lotus Pharmaceuticals to commercialize and distribute VAZKEPA in South Korea and nine countries in Southeast Asia. In August 2023, the Company entered into an agreement with Neopharm (Israel) 1996 Ltd., or Neopharm, to distribute VAZKEPA in Israel, Gaza, West Bank, and the territories of the Palestinian Authority. The Company will be responsible for supplying finished product to these partners. We continue to assess other potential partnership opportunities for VASCEPA with companies outside of the United States and Europe with the intention of partnering in all other international markets where VASCEPA receives local regulatory approval.

Current wording

In February 2023, the Company entered into an agreement with CSL Seqirus, or CSL, to secure pricing and reimbursement, commercialize and distribute VAZKEPA in Australia and New Zealand. In July 2023, the Company entered into an agreement with Lotus Pharmaceuticals to commercialize and distribute VAZKEPA in South Korea and nine countries in Southeast Asia. In August 2023, the Company entered into an agreement with Neopharm (Israel) 1996 Ltd., or Neopharm, to distribute VAZKEPA in Israel, Gaza, West Bank, and the territories of the Palestinian Authority. In May 2024, the Company entered into an agreement with Vianex

Previous wording

Since its inception in 2011, the REDUCE-IT cardiovascular outcomes study of VASCEPA has been the centerpiece of our research and development. Most of our other research and development during this period also pertained to VASCEPA, including the study of the mechanism of action of the single active ingredient in VASCEPA, icosapent ethyl. Based on the final positive results of REDUCE-IT, we sought additional indicated uses for VASCEPA in the United States and continue to pursue approval for VASCEPA around the world. We also anticipate continuing to publish additional details of the REDUCE-IT study to address scientific interest beyond the primary results of this study derived from the over 35,000 patient years of study experience which were accumulated in the REDUCE-IT study.

Current wording

Since its inception in 2011, the REDUCE-IT cardiovascular outcomes study of VASCEPA has been the centerpiece of our research and development. Most of our other research and development during this period also pertained to VASCEPA, including the study of the mechanism of action of the single active ingredient in VASCEPA, icosapent ethyl, or IPE. Based on the final positive results of REDUCE-IT, we sought additional indicated uses for VASCEPA in the United States and continue to pursue approval for VASCEPA around the world. We also anticipate continuing to publish additional details of the REDUCE-IT study to address scientific interest beyond the primary results of this study derived from the over 35,000 patient years of study experience which were accumulated in the REDUCE-IT study.

Previous wording

Based on REDUCE-IT results, as of the date of the filing of this Quarterly Report, more than 40 clinical treatment guidelines, consensus statements or scientific statements from medical societies or journals have been updated recommending the use of icosapent ethyl in appropriate at-risk patients, including those statements which we were informed of by our global partners in Australia, Canada, China and the Middle East as well as guidelines or statements which were newly received during the first quarter of 2024 as listed below:

Current wording

Based on REDUCE-IT results, as of the date of the filing of this Quarterly Report, more than 40 clinical treatment guidelines, consensus statements or scientific statements from medical societies or journals have been updated recommending the use of icosapent ethyl in appropriate at-risk patients, including those statements which we were informed of by our global partners in Australia, Canada, China and the Middle East as well as guidelines or statements which were newly received during the second quarter of 2024 as listed below:

Previous wording

In April 2024, we highlighted three data presentations showcasing the mechanistic activity of Eicosapentaenoic acid, or EPA, at the American College of Cardiology scientific session. These presentations advanced the understanding of how EPA and VASCEPA work to reduce CV events in at-risk patients.

Current wording

In May 2024, we supported two data presentations showcasing the mechanistic activity of eicosapentaenoic acid, or EPA, at the European Atherosclerosis Society scientific session in Lyon, France. These presentations may advance the understanding of how EPA and VASCEPA work to reduce CV events in at-risk patients.

Previous wording

In the first three months of 2024, Amarin and global medical and scientific collaborators supported seven publications inclusive of accepted abstracts, posters, and manuscripts.

Current wording

In the first six months of 2024, Amarin and global medical and scientific collaborators supported over 15 publications inclusive of accepted abstracts, posters, and accepted journal manuscripts.

Previous wording

We manage the manufacturing and supply of VASCEPA and rely on contract manufacturers in each step of our commercial and clinical product supply chain. These steps include active pharmaceutical ingredient, or API, manufacturing, encapsulation of the API, product packaging and supply-related logistics. Our approach to product supply procurement is designed to mitigate risk of supply interruption and maintain an environment of cost competition through diversification of contract manufacturers at each stage of the supply chain and lack of reliance on any single supplier. We have multiple U.S. FDA-approved international API suppliers, encapsulators and packagers to support the VASCEPA commercial franchise. We also have multiple international API suppliers, encapsulators and packagers to support the commercialization of VASCEPA in geographies where the drug is approved outside the United States. Not all of our suppliers approved by the U.S. FDA are approved in every other geography. The regulatory process generally requires extensive details as part of the submission provided to a country or region in connection with a company's request for regulatory approval. Suppliers must be specifically identified as part of the submission for qualification and approval for commercialization in a country or region. As a result, only supply, as approved, may be used in finished goods available for sale in a specific country or region. The amount of supply we seek to purchase in future periods will depend on the level of growth of VASCEPA revenues and minimum purchase commitments with certain suppliers. Beginning in 2022, we reviewed our contractual supplier purchase obligations and began taking steps to amend supplier agreements to align supply arrangements with current and future market demand, while we decrease our current inventory levels primarily related to North America approved inventory. As of March 31, 2024, we had inventory of $329.5 million, of which 75% is inventory approved for use in North America. We continue to negotiate with our contract suppliers to align our supply arrangements with current and future global market demand.

Current wording

We manage the manufacturing and supply of VASCEPA and rely on contract manufacturers in each step of our commercial and clinical product supply chain. These steps include active pharmaceutical ingredient, or API, manufacturing, encapsulation of the API, product packaging and supply-related logistics. Our approach to product supply procurement is designed to mitigate risk of supply interruption and maintain an environment of cost competition through diversification of contract manufacturers at each stage of the supply chain and lack of reliance on any single supplier. We have multiple U.S. FDA-approved international API suppliers, encapsulators and packagers to support the VASCEPA commercial franchise. We also have multiple international API suppliers, encapsulators and packagers to support the commercialization of VASCEPA in geographies where the drug is approved outside the United States. Not all of our suppliers approved by the U.S. FDA are approved in every other geography. The regulatory process generally requires extensive details as part of the submission provided to a country or region in connection with a company's request for regulatory approval. Suppliers must be specifically identified as part of the submission for qualification and approval for commercialization in a country or region. As a result, only supply, as approved, may be used in finished goods available for sale in a specific country or region. The amount of supply we seek to purchase in future periods will depend on the level of growth of VASCEPA revenues and minimum purchase commitments with certain suppliers. Beginning in 2022, we reviewed our contractual supplier purchase obligations and began taking steps to amend supplier agreements to align supply arrangements with current and future market demand, while we decrease our current inventory levels primarily related to North America approved inventory. As of June 30, 2024, we had inventory of $310.7 million, of which 70% is inventory approved for use in North America. We continue to negotiate with our contract suppliers to align our supply arrangements with current and future global market demand.

Previous wording

Cost of goods sold. Cost of goods sold includes the cost of API for VASCEPA on which revenue was recognized during the period, as well as the associated costs for encapsulation, packaging, shipment, supply management, quality assurance, insurance, and other indirect manufacturing, logistics and product support costs. The cost of the API included in cost of goods sold reflects the average cost method of inventory valuation and relief. This average cost reflects the actual purchase price of VASCEPA API. Our cost of goods sold is not materially impacted by whether we sell VASCEPA directly in a country or we sell VASCEPA to a commercial partner for resale in a country. In the three months ended March 31, 2023, we incurred costs within cost of goods sold - restructuring inventory related to steps taken to amend supplier agreements to align supply arrangements with current and future market demand (none as of March 31, 2024).

Current wording

Cost of goods sold. Cost of goods sold includes the cost of API for VASCEPA on which revenue was recognized during the period, as well as the associated costs for encapsulation, packaging, shipment, supply management, quality assurance, insurance, and other indirect manufacturing, logistics and product support costs. The cost of the API included in cost of goods sold reflects the average cost method of inventory valuation and relief. This average cost reflects the actual purchase price of VASCEPA API. Our cost of goods sold is not materially impacted by whether we sell VASCEPA directly in a country or we sell VASCEPA to a commercial partner for resale in a country. In the three and six months ended June 30, 2023, we incurred costs within Cost of goods sold - restructuring inventory related to steps taken to amend supplier agreements to align supply arrangements with current and future market demand.

Previous wording

Interest income, net and other income, net. Interest income, net, consists primarily of interest earned on our cash and cash equivalents, as well as our short-term and long-term investments. Other income, net, consists of foreign exchange losses and gains as well as sublease income.

Current wording

Interest income, net and other income (expense), net. Interest income, net consists primarily of interest earned on our cash and cash equivalents, as well as our short-term and long-term investments. Other income (expense), net, consists of the Employee Retention Credit, or ERC, awarded as part of the Coronavirus Aid, Relief and Economic Stabilization Act, or CARES Act, and foreign exchange losses and gains as well as sublease income.

Previous wording

Income tax provision. Income tax provision, deferred tax assets and liabilities, and reserves for unrecognized tax benefits reflect management’s best assessment of estimated future taxes to be paid. We are subject to income taxes in both the United States and foreign jurisdictions. In applying guidance prescribed under ASC 740 and based on present evidence and conclusions around the realizability of deferred tax assets, we determined that any tax benefit related to the pretax losses generated for 2024 and 2023 are not more likely than not to be realized.

Current wording

(Provision for) benefit from income taxes. Income tax provision, deferred tax assets and liabilities, and reserves for unrecognized tax benefits reflect management’s best assessment of estimated future taxes to be paid. We are subject to income taxes in both the United States and foreign jurisdictions. In applying guidance prescribed under ASC 740 and based on present evidence and conclusions around the realizability of deferred tax assets, we determined that any tax benefit related to the pretax losses generated for 2024 and 2023 are not more likely than not to be realized.

Previous wording

Total revenue, net. We recorded total revenue, net, of $56.5 million and $86.0 million during the three months ended March 31, 2024 and 2023, respectively, a decrease of $29.5 million, or 34%. Total revenue, net, consists primarily of revenue from the sale of VASCEPA in the United States. In addition to the United States we also sell VASCEPA by prescription in certain countries in Europe as well as certain countries outside of the United States and Europe, such as China and Canada, through collaborations with third-party companies. As further discussed below, the aforementioned decrease consists of a $34.2 million decrease in U.S. net product revenue offset in part by a $4.8 million increase in net product revenue outside of the United States.

Current wording

Total revenue, net. We recorded total revenue, net, of $67.5 million and $80.2 million during the three months ended June 30, 2024 and 2023, respectively, a decrease of $12.7 million, or 16%. Total revenue, net, consists primarily of revenue from the sale of VASCEPA in the United States. In addition to the United States, during the three months ending June 30, 2024, we also sold VASCEPA by prescription in certain countries in Europe as well as certain countries outside of the United States and Europe, such as China and Canada, through collaborations with third-party companies. As further discussed below, the aforementioned decrease consists of a $20.8 million decrease in U.S. net product revenue offset in part by a $3.1 million increase in net product revenue outside of the United States and a $5.0 million increase in licensing and royalty revenue.

Previous wording

Product revenue, net. We recorded product revenue, net, of $55.2 million and $84.7 million during the three months ended March 31, 2024 and 2023, respectively, a decrease of $29.5 million, or 35%. This decrease was due primarily to a 41% decrease in VASCEPA sales in the United States.

Current wording

Product revenue, net. We recorded product revenue, net, of $47.5 million and $65.2 million during the three months ended June 30, 2024 and 2023, respectively, a decrease of $17.7 million, or 27%. This decrease was due primarily to a 32% decrease in VASCEPA sales in the United States.

Previous wording

We recorded U.S. product revenue, net, of $48.1 million and $82.3 million during the three months ended March 31, 2024 and 2023, respectively. This decrease was due to a decline in net selling price as a result of the continued impact from generic competition in the market and changes in business mix.

Current wording

We recorded U.S. product revenue, net of $43.8 million and $64.6 million during the three months ended June 30, 2024 and 2023, respectively. This decrease was due to a decline in net selling price as a result of the impact from generic competition in the market.

Previous wording

The overall icosapent ethyl market in the United States, based on prescription levels reported by Symphony Health, decreased for the three months ended March 31, 2024 by 4% as compared to the three months ended March 31, 2023. Our share of the icosapent ethyl market has remained relatively consistent at approximately 56% in the three months ended March 31, 2024 and approximately 57% in the three months ended March 31, 2023. Additionally, based on prescription levels reported by Symphony Health, VASCEPA-branded prescriptions decreased by 5% in the three months ended March 31, 2024 compared to the three months ended March 31, 2023.

Current wording

The overall icosapent ethyl market in the United States, based on prescription levels reported by Symphony Health, decreased for the three months ended June 30, 2024 by 1% as compared to the three months ended June 30, 2023. Our share of the icosapent ethyl market has increased to approximately 59% in the three months ended June 30, 2024 compared to approximately 57% in the three months ended June 30, 2023. Additionally, based on prescription levels reported by Symphony Health, VASCEPA-branded prescriptions increased by 2% in the three months ended June 30, 2024 compared to the three months ended June 30, 2023.

Previous wording

For the three months ended March 31, 2024, we recorded $5.2 million of product revenue, net, from our collaboration partners outside of the United States and Europe compared to $1.9 million during the three months ended March 31, 2023.

Current wording

For the three months ended June 30, 2024, we recorded $0.2 million of product revenue, net, from our collaboration partners compared to nil during the three months ended June 30, 2023.

Previous wording

Edding – a $15.0 million upfront payment received in February 2015, a $1.0 million milestone payment achieved in March 2016 following submission of the clinical trial application to the Chinese regulatory authority, a $5.0 million milestone payment achieved in June 2023 following NMPA approval of VASCEPA under the MARINE indication and a $3.0 million milestone payment achieved in October 2023 following a regulatory submission to the NMPA for VASCEPA under the REDUCE-IT indication.

Current wording

Edding – a $15.0 million upfront payment received in February 2015, a $1.0 million milestone payment achieved in March 2016 following submission of the clinical trial application to the Chinese regulatory authority, a $5.0 million milestone payment achieved in June 2023 following NMPA approval of VASCEPA under the MARINE indication, a $3.0 million milestone payment achieved in October 2023 following a regulatory submission to the NMPA for VASCEPA under the REDUCE-IT indication and a $15.0 million milestone payment achieved in June 2024 following regulatory approval of VASCEPA under the REDUCE-IT indication. As of June 30, 2024, these payments have been fully recognized.

Previous wording

Licensing and royalty revenue recognized in the prior period relates to the recognition of the above as well as below amounts received in connection with the following VASCEPA licensing agreements:

Current wording

Licensing and royalty revenue recognized in the prior period relates to partial recognition of the above upfront and previously achieved milestones, excluding the REDUCE-IT indication approval, as well as below amounts received in connection with the following VASCEPA licensing agreements:

Previous wording

HLS – a $5.0 million upfront payment which was received upon closing of the agreement in September 2017, a $2.5 million milestone payment that was received following achievement of the REDUCE-IT trial primary endpoint in September 2018, a $2.5 million milestone payment that was received following U.S. FDA approval of a new indication and label expansion in December 2019, and a $3.8 million milestone payment that was received as a result of obtaining a regulatory exclusivity designation in January 2020. All of which was fully recognized in 2023.

Current wording

HLS – a $5.0 million upfront payment which was received upon closing of the agreement in September 2017, a $2.5 million milestone payment that was received following achievement of the REDUCE-IT trial primary endpoint in September 2018, a $2.5 million milestone payment that was received following U.S. FDA approval of a new indication and label expansion in December 2019, and a $3.8 million milestone payment that was received as a result of obtaining a regulatory exclusivity designation in January 2020. As of June 30, 2023, these payments have been fully recognized.

Previous wording

Our overall gross margin on product sales for each of the three months ended March 31, 2024 and 2023 was 55%. Excluding the restructuring inventory charges, gross margin was 70% for the three months ended March 31, 2023. The decrease is due to a decline in net selling price.

Current wording

Our overall gross margin on product sales for the three months ended June 30, 2024 and 2023 was 48% and 42%, respectively. Excluding the restructuring inventory charge, gross margin was 48% and 64% for the three months ended June 30, 2024 and 2023, respectively. The decrease in gross margin is primarily as a result of a decrease in net selling price.

Previous wording

Selling, general and administrative expense. Selling, general and administrative expense for the three months ended March 31, 2024 and 2023 was $39.9 million and $59.6 million, respectively, a decrease of $19.7 million, or 33%. Selling, general and administrative expenses for the three months ended March 31, 2024 and 2023 are summarized in the table below:

Current wording

Selling, general and administrative expense. Selling, general and administrative expense for the three months ended June 30, 2024 and 2023 was $38.5 million and $51.0 million, respectively, a decrease of $12.4 million, or 24%. Selling, general and administrative expenses for the three months ended June 30, 2024 and 2023 are summarized in the table below:

Previous wording

Selling expense for the three months ended March 31, 2024 and 2023 was $20.4 million and $32.2 million, respectively, a decrease of $11.8 million, or 37%. This decrease is primarily due to a reduction in costs associated with our ORP resulting in decreased promotional initiatives, reduced travel and elimination of our U.S. sales force.

Current wording

Selling expense for the three months ended June 30, 2024 and 2023 was $20.5 million and $32.3 million, respectively, a decrease of $11.8 million, or 37%. This decrease is primarily due to a reduction in costs associated with our ORP and cost reduction plans resulting in decreased promotional initiatives, reduced travel and elimination of our U.S. sales force.

Previous wording

General and administrative expense for the three months ended March 31, 2024 and 2023 was $15.3 million and $23.1 million, respectively, a decrease of $7.8 million, or 34%. This decrease is primarily due to a decrease in employee-related costs as a result of the reduction in force from the ORP as well as advisory fees incurred in 2023 related to the previously held special shareholder's meeting.

Current wording

General and administrative expense for the three months ended June 30, 2024 and 2023 was $14.5 million and $17.7 million, respectively, a decrease of $3.2 million, or 18%. This decrease is primarily due to a decrease in employee-related costs as a result of the reduction in force from the ORP and cost reduction plans.

Previous wording

Non-cash stock-based compensation expense represents the estimated costs associated with equity awards issued to internal personnel supporting our selling, general and administrative functions.

Current wording

Non-cash stock-based compensation expense for the three months ended June 30, 2024 and 2023 was $3.5 million and $1.0 million, respectively, an increase of $2.6 million, or 271%. Non-cash stock-based compensation expense represents the estimated costs associated with equity awards issued to internal personnel supporting our selling, general and administrative functions. The increase is due to prior years reversal of expense associated with our former CEO's resignation, as well as certain performance-based awards as it was no longer deemed probable that the performance criteria for vesting would be achieved within the required timeframe.

Previous wording

As part of our ORP announced in July 2023, we have redesigned our commercial infrastructure in Europe to better align with pricing and reimbursement status, commercial progress to date, as well as streamline certain cross-geographic functions. In addition, we are continuing to advance our pricing and reimbursement activities to drive access in remaining geographies, as well as advancing regulatory filings internationally and focusing on maximizing U.S. cash flow through a streamlined model. We will continue to evaluate all of our spending commitments and priorities based on our refocused strategic priorities and restructuring plan.

Current wording

As part of our ORP announced in July 2023, we have redesigned our commercial infrastructure in Europe and in the U.S. as well as focusing on maximizing U.S. cash flow through a streamlined model, which has resulted in $50.0 million in operating cost reductions annually. We will continue to evaluate all of our spending commitments and priorities based on our refocused strategic priorities and restructuring plan.

Previous wording

Research and development expense. Research and development expense for the three months ended March 31, 2024 and 2023 was $5.6 million and $5.7 million, respectively, a decrease of $0.1 million, or 1%. Research and development expenses for the three months ended March 31, 2024 and 2023 are summarized in the table below:

Current wording

Research and development expense. Research and development expense for the three months ended June 30, 2024 and 2023 was $4.7 million and $5.6 million, respectively, a decrease of $0.9 million, or 16%. Research and development expenses for the three months ended June 30, 2024 and 2023 are summarized in the table below:

Previous wording

Interest income, net. Interest income, net, for the three months ended March 31, 2024 and 2023 was $3.4 million and $2.2 million, respectively, an increase of $1.2 million, or 52%. Interest income, net, represents income earned on cash and investment balances. The increase is primarily due to higher interest rates in the current year period compared to the prior year period.

Current wording

Interest income, net. Interest income, net, for the three months ended June 30, 2024 and 2023 was $3.3 million and $3.0 million, respectively, an increase of $0.3 million, or 9%. Interest income, net, represents income earned on cash and investment balances. The increase is primarily due to higher investment balances in the current year period compared to the prior year period.

Previous wording

Licensing and royalty revenue. Licensing and royalty revenue during the three months ended March 31, 2024 and 2023 was $1.4 million and $1.3 million, respectively, an increase of $0.1 million, or 3%. Licensing and royalty revenue has remained consistent primarily due an increase in recognition of deferred milestone and upfront payments relating to Edding as well as royalties related to the commercial launch in China, offset by the recognition of CSL upfront payment and recognition of previously achieved milestone payments from HLS in the prior year. Licensing and royalty revenue recognized in the current period relates to the recognition of amounts received in connection with the following VASCEPA licensing agreements:

Current wording

Licensing and royalty revenue. Licensing and royalty revenue during the six months ended June 30, 2024 and 2023 was $21.3 million and $16.3 million, respectively, an increase of $5.0 million, or 31%. Licensing and royalty revenue increased primarily due to recognition of the REDUCE-IT indication milestone in China, offset by the recognition of CSL upfront payment and recognition of previously achieved milestone payments from HLS in the prior year. Licensing and royalty revenue recognized in the current period relates to the recognition of amounts received in connection with the following VASCEPA licensing agreements:

Previous wording

CSL – a $0.5 million upfront payment which was received upon closing of the agreement in January 2023.

Current wording

CSL – a $0.5 million up-front payment which was received upon closing of the agreement in January 2023.

Previous wording

The upfront and milestone payments from Edding is being recognized over the estimated period in which we are required to provide regulatory and development support pursuant to the agreement. The upfront and milestone payments from HLS were being recognized over the estimated period in which we were required to provide regulatory and development support pursuant to the agreement which was satisfied in 2023. The upfront payments from CSL was recognized in January 2023 upon closing of the agreement as no regulatory and development support is required pursuant to the agreement. The amount of licensing and royalty revenue is expected to vary from period to period based on timing of milestones achieved and changes in estimates of the timing and level of support required.

Current wording

The upfront and milestone payments from Edding and HLS were being recognized over the estimated period in which we were required to provide regulatory and development support pursuant to the respective agreements which were satisfied in 2024 and 2023, respectively. The upfront payment from CSL was recognized in January 2023 upon closing of the agreement as no regulatory and development support is required pursuant to the agreement. The amount of licensing and royalty revenue is expected to vary from period to period based on timing of milestones achieved and changes in estimates of the timing and level of support required.

Previous wording

Cost of goods sold. Cost of goods sold during the three months ended March 31, 2024 and 2023 was $24.6 million and $38.0 million, respectively, a decrease of $13.4 million, or 35%. Cost of goods sold includes the cost of API for VASCEPA on which revenue was recognized during the period, as well as the associated costs for encapsulation, packaging, shipment, supply management, insurance and quality assurance. The cost of the API included in cost of goods sold reflects the average cost of API included in inventory. This average cost reflects the actual purchase price of VASCEPA API. During the three months ended March 31, 2024 and 2023, we have taken steps to amend supplier agreements to align supply arrangements with current and future demand resulting in charges of nil and $12.3 million, respectively, which were recorded as cost of goods sold - restructuring inventory. During the three months ended March 31, 2024 and 2023, approximately $1.5 million and $2.3 million, respectively, of inventory was expensed through cost of goods sold due to both product dating and non-product dating unsellable inventory.

Current wording

Cost of goods sold. Cost of goods sold during the six months ended June 30, 2024 and 2023 was $49.3 million and $75.5 million, respectively, a decrease of $26.2 million, or 35%. Cost of goods sold includes the cost of API for VASCEPA on which revenue was recognized during the period, as well as the associated costs for encapsulation, packaging, shipment, supply management, insurance and quality assurance. The cost of the API included in cost of goods sold reflects the average cost of API included in inventory. This average cost reflects the actual purchase price of VASCEPA API. During the six months ended June 30, 2023, we have taken steps to amend supplier agreements to align supply arrangements with current and future demand resulting in charges of $26.6 million which were recorded as cost of goods sold - restructuring inventory.

Previous wording

The API included in the calculation of the average cost of goods sold during the three months ended March 31, 2024 and 2023 was sourced from multiple API suppliers. These suppliers compete with each other based on cost, consistent quality, capacity, timely delivery and other factors. In the future, we may see the average cost of supply change based on numerous potential factors including increased volume purchases, continued improvement in manufacturing efficiency, the mix of purchases made among suppliers, currency exchange rates and other factors. The average cost may be variable from period to period depending upon the timing and quantity of API purchased from each supplier.

Current wording

The API included in the calculation of the average cost of goods sold during the six months ended June 30, 2024 and 2023 was sourced from multiple API suppliers. These suppliers compete with each other based on cost, consistent quality, capacity, timely delivery and other factors. In the future, we may see the average cost of supply change based on numerous potential factors including increased volume purchases, continued improvement in manufacturing efficiency, the mix of purchases made among suppliers, currency exchange rates and other factors. The average cost may be variable from period to period depending upon the timing and quantity of API purchased from each supplier.

Previous wording

Other income, net. Other income, net, for the three months ended March 31, 2024 and 2023 was $1.5 million and $0.6 million, respectively, an increase of $0.9 million, or 148%. Other income, net, primarily consists of the gains and losses on foreign exchange transactions and sublease income related to our Bridgewater, NJ facility.

Current wording

Other income, net. Other income, net, for the six months ended June 30, 2024 and 2023 was income of $1.7 million and $3.7 million, respectively, a decrease of $2.0 million, or 54%. Other income, net, primarily consists of the ERC awarded as part of the

Previous wording

As of March 31, 2024, our aggregate sources of liquidity include cash and cash equivalents and restricted cash of $214.5 million and short-term investments of $94.2 million. We have no indebtedness. Our cash and cash equivalents primarily include checking accounts and money market funds with original maturities of less than 90 days. Our short-term investments consist of securities that will be due in one year or less. We invest cash in excess of our immediate requirements, in accordance with our investment policy, which limits the amounts we may invest in any one type of investment and requires all investments held by us to maintain minimum ratings from Nationally Recognized Statistical Rating Organizations so as to primarily achieve our goals of liquidity and capital preservation.

Current wording

As of June 30, 2024, our aggregate sources of liquidity include cash and cash equivalents and restricted cash of $216.4 million and short-term investments of $90.7 million. We have no indebtedness. Our cash and cash equivalents primarily include checking accounts and money market funds with original maturities of less than 90 days. Our short-term investments consist of securities that will be due in one year or less. We invest cash in excess of our immediate requirements, in accordance with our investment policy, which limits the amounts we may invest in any one type of investment and requires all investments held by us to maintain minimum ratings from Nationally Recognized Statistical Rating Organizations so as to primarily achieve our goals of liquidity and capital preservation.

Previous wording

Net cash used in operating activities increased during the three months ended March 31, 2024 as compared to the same period in 2023. This is primarily as a result of inventory purchases and restructuring payments made in 2024 which did not occur in the same period in 2023.

Current wording

Net cash used in operating activities increased during the six months ended June 30, 2024 as compared to net cash provided by operating activities during the same period in 2023. This is primarily as a result of inventory purchases and restructuring payments made in 2024 which did not occur in the same period in 2023.

Previous wording

Net cash provided by investing activities during the three months ended March 31, 2024 increased due primarily to proceeds from the maturity of $62.0 million in investment grade interest bearing instruments, partially offset by $33.3 million in purchases of the investment grade interest bearing instruments as compared to the same period in 2023 where proceeds from the maturity of investment grade interest bearing instruments was $32.9 million, partially offset by $52.5 million in purchases of investment grade interest bearing instruments.

Current wording

Net cash provided by investing activities during the six months ended June 30, 2024 increased due primarily to proceeds from the maturity of $133.0 million in investment grade interest-bearing instruments, partially offset by $99.6 million in purchases of the investment grade interest-bearing instruments as compared to the same period in 2023 where proceeds from the maturity of investment grade interest-bearing instruments was $97.0 million, partially offset by $82.3 million in purchases of investment-grade interest bearing instruments.

Previous wording

Net cash used in financing activities during the three months ended March 31, 2024 was $1.4 million as compared net cash provided by financing activities of $0.4 million during the same period in 2023. The change was primarily a result of a decrease in stock option exercises in 2024 due to stock option exercises by former executives in 2023.

Current wording

Net cash used in financing activities during the six months ended June 30, 2024 as compared to net cash provided by financing activities during the same period in 2023 was primarily as a result of a decrease in proceeds related to stock option exercises.

Previous wording

As of March 31, 2024, we had net accounts receivable of $115.8 million, current inventory of $255.3 million and long-term inventory of $74.2 million. We have incurred annual operating losses since our inception and, as a result, we had an accumulated deficit of $1.6 billion as of March 31, 2024. We anticipate that quarterly net cash outflows in future periods will continue to be variable as a result of the timing of certain items, including our purchases of API, the generic competition in the United States and pricing and reimbursement of VAZKEPA in Europe.

Current wording

As of June 30, 2024, we had net accounts receivable of $123.7 million, current inventory of $239.4 million and long-term inventory of $71.3 million. We have incurred annual operating losses since our inception and, as a result, we had an accumulated deficit of $1.6 billion as of June 30, 2024. We anticipate that quarterly net cash outflows in future periods will continue to be variable as a result of the timing of certain items, including our purchases of API, the generic competition in the United States and pricing and reimbursement of VAZKEPA in Europe.