Amarin Corporation’s (AMRN) shares skid around 23.8% on Jan 21 after the Division of Metabolism and Endocrinology Products (:DMEP) within the U.S. Food and Drug Administration (:FDA) turned down Amarin's request for reconsideration of DMEP's Oct 2013 decision.

In Oct 2013, the Endocrinologic and Metabolic Drugs Advisory Committee of the FDA voted against the approval of the company’s only product, Vascepa, for an additional indication. Amarin is seeking to get Vascepa approved as an adjunct to diet and exercise and in combination with a statin for treating adults suffering from high triglyceride levels (≥200 mg/dL and CHD) or a CHD risk equivalent. Amarin refers to this as the ANCHOR indication.

At the advisory committee meeting the DEMP stated that the available data did not support the use of drug-induced reductions in serum triglycerides as a basis for the approval of Vascepa in the ANCHOR indication. On Jan 21, 2014, Amarin announced that the DEMP had turned down its request to reinstate the special protocol assessment in the ANCHOR study by maintaining its advisory committee meeting verdict.

We are disappointed with the DMEP rejecting Amarin's request for reconsideration of the Oct 2013 decision. Amarin is however leaving no stone unturned to get the drug approved for the ANCHOR indication. Amarin mentioned in its conference call that the DMEP did not respond to its 20 questions. The company now plans to appeal to the FDA Director of the Office of Drug Evaluation II (ODE-II) against the DMEP decision. However, a decision on Vascepa’s supplemental New Drug Application for the ANCHOR indication (accepted by the FDA in Apr 2013) will not be available till the appeal is pending.

We note that Vascepa is already approved in the U.S. as an adjunct to diet for reducing triglyceride levels in adults suffering from severe hypertriglyceridemia (triglyceride ≥ 500mg/dL). Amarin refers to this as the MARINE indication. Amarin started marketing the drug in the U.S. in Jan 2013 and reported $8.4 million in sales of Vascepa in the third quarter of 2013.

The company intends to focus on expanding Vascepa’s sales potential. Moreover, Amarin intends to explore ex-U.S. opportunities for Vascepa. We expect investor focus to remain on updates on the drug’s ANCHOR indication.

Amarin carries a Zacks Rank #4 (Sell). Some better-ranked stocks include Affymetrix Inc. (AFFX), Actelion Ltd. (ALIOF) and Gentium (GENT). All these stocks hold a Zacks Rank #1 (Strong Buy).

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