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Amarin or Novavax: Which Will Report Faster Revenue Growth?

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Revenue guidance

With its 2018 unaudited results, as announced in an investor presentation, Amarin (AMRN) has guided for net total revenue in the range of $72 million–$76 million and $224 million–$228 million for the fourth quarter and fiscal 2018, respectively. The company attributes the $43 million–$47 million year-over-year rise in revenues to solid growth in Vascepa prescriptions.

According to the company’s investor presentation, Vascepa’s demand and Amarin’s revenue performance in fiscal 2018 were minimally influenced by the REDUCE-IT trial since the results were published in late 2018. However, Amarin has highlighted the positive initial feedback from healthcare providers for the results.

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According to the company’s investor presentation, Amarin has guided for a year-over-year revenue rise of more than 50%, reaching almost $350 million for fiscal 2019. This estimate doesn’t assume the impact of a probable label expansion of Vascepa based on REDUCE-IT trial results. The company, however, anticipates a multi-billion dollar opportunity for Vascepa if the drug is approved for controlling residual cardiovascular risk in addition to cholesterol management.

While Amarin is a commercial-stage company, Novavax (NVAX) is still a clinical-stage vaccines-only company. In March 2018, the company announced that it secured a grant for $89 million from the Bill and Melinda Gates Foundation relating to the Prepare trial for its most advanced research program of RSV vaccination for infants via maternal immunization. According to Novavax’s third-quarter earnings conference call, the grant revenues recorded depend on operating activities in the Prepare trial and have resulted in volatility in quarterly revenues in fiscal 2018.

Wall Street’s projections

Wall Street analysts expect Amarin’s revenues at $225.73 million, $352.70 million, and $569.63 million for fiscal 2018, fiscal 2019, and fiscal 2020, respectively. These figures imply year-over-year revenue growth of 24.64%, 56.25%, and 61.51%, respectively.

On the other hand, Wall Street analysts expect Novavax’s revenues at $35.23 million, $5.1 million, and $11.55 million for fiscal 2018, fiscal 2019, and fiscal 2020, respectively. These figures imply a year-over-year revenue change of 12.99%, -85.52%, and 126.47%, respectively.

Amarin is expected to report higher absolute revenues as well as year-over-year revenue growth from fiscal 2018 to fiscal 2020, compared to Novavax.

Next in this series, we’ll discuss EPS projections for Amarin and Novavax in fiscal 2019.

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