SEC Filing | Amarin Corporation plc

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amrn-10q_20190630.htm

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2019

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File No. 000-21392

Amarin Corporation plc

(Exact Name of Registrant as Specified in its Charter)

England and Wales

Not applicable

(State or Other Jurisdiction of

Incorporation or Organization)

(I.R.S. Employer

Identification No.)

77 Sir John Rogerson’s Quay, Block C,

Grand Canal Docklands

Dublin 2, Ireland

(Address of Principal Executive Offices)

(Zip Code)

Registrant’s telephone number, including area code: +353 (0) 1 6699 020

2 Pembroke House, Upper Pembroke Street 28-32, Dublin 2, Ireland

Former name or former address, if changed since last report

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of each exchange on which registered

American Depositary Shares (ADS(s)), each ADS

representing the right to receive one (1) Ordinary Share of

Amarin Corporation plc

AMRN

NASDAQ Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES ☒ NO ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). YES ☒ NO ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	☐

Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). YES ☐ NO ☒

357,214,478 common shares were outstanding as of July 29, 2019, including 357,009,987 shares held as American Depositary Shares (ADSs), each representing one Ordinary Share, 50 pence par value per share and 204,491 Ordinary Shares. In addition, 28,931,746 ordinary share equivalents were issuable in exchange for outstanding preferred shares as of July 29, 2019, for a total of 386,146,224 ordinary shares and ordinary share equivalents outstanding as of July 29, 2019.

INDEX TO FORM 10-Q

		Page

	PART I – Financial Information

Item 1.	Financial Statements (unaudited):
	Condensed Consolidated Balance Sheets as of June 30, 2019 and December 31, 2018	3
	Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2019 and 2018	4
	Condensed Consolidated Statement of Changes in Stockholders’ Equity (Deficit) for the six months ended June 30, 2019 and 2018	5
	Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2019 and 2018	6
	Notes to Condensed Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	35
Item 4.	Controls and Procedures	35

	PART II – Other Information

Item 1.	Legal Proceedings	36
Item 1A.	Risk Factors	36

Item 6.	Exhibits	76

SIGNATURES		77

PART I

AMARIN CORPORATION PLC

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited, in thousands, except share amounts)

	June 30, 2019			December 31, 2018
ASSETS
Current Assets:
Cash and cash equivalents	$	221,771		$	249,227
Restricted cash		1,503			1,500
Accounts receivable, net		95,398			66,523
Inventory		46,268			57,802
Prepaid and other current assets		7,103			2,945
Total current assets		372,043			377,997
Property, plant and equipment, net		858			63
Operating lease right-of-use asset		8,762			—
Other long-term assets		1,102			174
Intangible asset, net		7,157			7,480
TOTAL ASSETS	$	389,922		$	385,714
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$	34,018		$	37,632
Accrued expenses and other current liabilities		103,495			84,171
Current portion of long-term debt from royalty-bearing instrument		45,410			34,240
Deferred revenue, current		1,962			1,220
Total current liabilities		184,885			157,263
Long-Term Liabilities:
Long-term debt from royalty-bearing instrument		23,202			46,108
Deferred revenue, long-term		17,775			19,490
Long-term operating lease liability		8,160			—
Other long-term liabilities		6,813			10,523
Total liabilities		240,835			233,384
Commitments and contingencies (Note 6)
Stockholders’ Equity:
Series A Convertible Preferred Stock, £0.05 par, unlimited authorized; 289,317,460 shares issued and outstanding as of June 30, 2019 and December 31, 2018 (equivalent to 28,931,746 ordinary shares upon future consolidation and redesignation at a 10:1 ratio)		21,850			21,850
Common stock, £0.50 par, unlimited authorized; 335,149,425 issued, 331,307,810 outstanding as of June 30, 2019; 329,110,863 issued, 325,850,013 outstanding as of December 31, 2018		250,588			246,663
Additional paid-in capital		1,311,965			1,282,762
Treasury stock; 3,841,615 shares as of June 30, 2019; 3,260,850 shares as of December 31, 2018		(20,533	)		(10,413	)
Accumulated deficit		(1,414,783	)		(1,388,532	)
Total stockholders’ equity		149,087			152,330
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	389,922		$	385,714

See notes to condensed consolidated financial statements.

AMARIN CORPORATION PLC

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited, in thousands, except per share amounts)

	Three months ended June 30,						Six months ended June 30,
	2019			2018			2019			2018
Product revenue, net	$	100,366		$	52,537		$	173,097		$	96,313
Licensing revenue		426			106			973			248
Total revenue, net		100,792			52,643			174,070			96,561
Less: Cost of goods sold		22,770			12,846			39,910			23,494
Gross margin		78,022			39,797			134,160			73,067
Operating expenses:
Selling, general and administrative		73,406			53,944			145,039			97,350
Research and development		7,130			18,159			14,372			29,921
Total operating expenses		80,536			72,103			159,411			127,271
Operating loss		(2,514	)		(32,306	)		(25,251	)		(54,204	)
Interest income (expense), net		789			(1,773	)		(908	)		(4,025	)
Other expense, net		(95	)		(131	)		(92	)		(76	)
Loss from operations before taxes		(1,820	)		(34,210	)		(26,251	)		(58,305	)
(Provision for) benefit from income taxes		—			—			—			—
Net loss	$	(1,820	)	$	(34,210	)	$	(26,251	)	$	(58,305	)
Loss per share:
Basic	$	(0.01	)	$	(0.12	)	$	(0.08	)	$	(0.20	)
Diluted	$	(0.01	)	$	(0.12	)	$	(0.08	)	$	(0.20	)
Weighted average shares:
Basic		330,863			293,662			329,793			289,458
Diluted		330,863			293,662			329,793			289,458

See notes to condensed consolidated financial statements.

AMARIN CORPORATION PLC

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

(Unaudited, in thousands, except share amounts)

	Preferred Shares		Common Shares		Treasury Shares			Preferred Stock		Common Stock		Additional Paid-in Capital			Treasury Stock			Accumulated Deficit			Total
December 31, 2018		289,317,460		329,110,863		(3,260,850	)	$	21,850	$	246,663	$	1,282,762		$	(10,413	)	$	(1,388,532	)	$	152,330
Exercise of stock options		—		3,838,739		—			—		2,496		12,960			—			—			15,456
Vesting of restricted stock units		—		1,416,124		(526,708	)		—		929		(929	)		(9,080	)		—			(9,080	)
Stock-based compensation		—		—		—			—		—		6,596			—			—			6,596
Loss for the period		—		—		—			—		—		—			—			(24,431	)		(24,431	)
March 31, 2019		289,317,460		334,365,726		(3,787,558	)	$	21,850	$	250,088	$	1,301,389		$	(19,493	)	$	(1,412,963	)	$	140,871
Issuance of common stock under employee stock purchase plan		—		47,358		—			—		30		807			—			—			837
Exercise of stock options		—		619,404		—			—		396		1,492			—			—			1,888
Vesting of restricted stock units		—		116,937		(54,057	)		—		74		(74	)		(1,040	)		—			(1,040	)
Stock-based compensation		—		—		—			—		—		8,351			—			—			8,351
Loss for the period		—		—		—			—		—		—			—			(1,820	)		(1,820	)
June 30, 2019		289,317,460		335,149,425		(3,841,615	)	$	21,850	$	250,588	$	1,311,965		$	(20,533	)	$	(1,414,783	)	$	149,087

	Preferred Shares		Common Shares		Treasury Shares			Preferred Stock		Common Stock		Additional Paid-in Capital			Treasury Stock			Accumulated Deficit			Total
December 31, 2017		328,184,640		272,719,044		(1,697,033	)	$	24,364	$	208,768	$	977,866		$	(4,229	)	$	(1,271,869	)	$	(65,100	)
Cumulative-effect adjustment		—		—		—			—		—		—			—			(218	)		(218	)
January 1, 2018		328,184,640		272,719,044		(1,697,033	)	$	24,364	$	208,768	$	977,866		$	(4,229	)	$	(1,272,087	)	$	(65,318	)
Issuance of common stock, net of transaction costs		—		20,616,438		—			—		14,635		55,372			—			—			70,007
Exercise of stock options		—		782,553		—			—		541		1,007			—			—			1,548
Vesting of restricted stock units		—		1,838,380		(675,242	)		—		1,302		(1,302	)		(2,553	)		—			(2,553	)
Stock-based compensation		—		—		—			—		—		3,754			—			—			3,754
Loss for the period		—		—		—			—		—		—			—			(24,095	)		(24,095	)
March 31, 2018		328,184,640		295,956,415		(2,372,275	)	$	24,364	$	225,246	$	1,036,697		$	(6,782	)	$	(1,296,182	)	$	(16,657	)
Issuance of common stock under employee stock purchase plan		—		127,872		—			—		85		338			—			—			423
Exercise of stock options		—		173,679		—			—		116		162			—			—			278
Vesting of restricted stock units		—		90,937		(41,252	)		—		60		(60	)		(127	)		—			(127	)
Stock-based compensation		—		—		—			—		—		3,606			—			—			3,606
Loss for the period		—		—		—			—		—		—			—			(34,210	)		(34,210	)
June 30, 2018		328,184,640		296,348,903		(2,413,527	)	$	24,364	$	225,507	$	1,040,743		$	(6,909	)	$	(1,330,392	)	$	(46,687	)

See notes to condensed consolidated financial statements.

AMARIN CORPORATION PLC

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited, in thousands)

	Six months ended June 30,
	2019	2018
CASH FLOWS FROM OPERATING ACTIVITIES: