Amarin Corporation Plc Sponsored ADR Stock

Good morning, and welcome to Amarin Corporation's conference call to discuss its Second Quarter 2026 Financial Results. 

[Operator Instructions]

Please note that this conference is being recorded. I would now like to turn the conference over to Devin Sullivan, Investor Relations for Amarin.

Thank you for your time and attention this morning as we discuss Amarin's 2026 second quarter financial results. 

On today's call are Aaron Berg, President and Chief Executive Officer; Steve Ketchum, President, Research & Development and Chief Scientific Officer; and Pete Fishman, Chief Financial Officer 

Other members of the senior management team will be available as needed during the Q&A session following the prepared remarks. 

Aaron will provide a state-of-the-company update. Steve will review recent medical and regulatory activities, and Pete will discuss the numbers. 

Before we begin, I'd like to remind everyone that today's press release and related Quarterly Report on Form 10-Q will be available on the Investor Relations section of the company's website, www.amarincorp.com, as well as a replay of this call shortly after its completion. 

Please be aware that during this call, we may make certain statements related to our business that are deemed forward-looking statements under federal securities laws.

These statements are not guarantees of future performance, but rather are subject to a variety of risks and uncertainties. Our actual results could differ materially from expectations reflected in any forward-looking statements.

Additionally, we assume no obligation to update these statements as circumstances change. For a discussion of the material risks and important factors that could affect our actual results, please refer to our SEC filings, which are available either on our company website or the Securities and Exchange Commission's EDGAR system.

With that said, I'd now like to turn the call over to Amarin's President and CEO, Aaron Berg. Aaron, please go ahead.

Thanks, Devin, and thank you all for joining us today. Q2 2026 marked an inflection point for Amarin, highlighting the 1-year anniversary of our dual commercial strategy that combines continued execution of our U.S. business with a fully partnered international commercial platform.

The successful implementation of these actions has resulted in a scalable business model while defining a clear path towards sustainable growth and profitability.

We're seeing a promising early-stage international sales trajectory in a number of markets where there remains significant unmet need and long-term potential for VAZKEPA while preserving a leading U.S. presence for VASCEPA, supported by a financial foundation that includes a growing cash position and no debt.

Our restructuring activities are now complete, resulting in a significantly lower cost base. This refined organizational structure and expense framework will enhance our ability to efficiently execute our long-term growth strategy.

As you may have noticed in our press release, we're now able to provide an outlook for certain key metrics for full-year 2026, reflecting the clarity afforded by our new operating model and the strong partnerships that make up its foundation.

This underscores how far the business has progressed in the past year while validating our global go-to-market initiatives and reinforcing the continued outstanding execution of our talented, committed team.

As of June 30, 2026, VASCEPA was commercially available in 22 countries via both our fully partnered international commercial strategy and company-managed U.S. presence.

Our accelerating international growth is being driven primarily by our exclusive license and supply agreement with Recordati, which covers 59 countries across Europe, as well as our 6 other commercial partnerships in the rest of the world that cover regions, including Canada, China, Israel, the Middle East, Asia, Australia and New Zealand.

Across this combined global partner network, in-market demand for VASCEPA rose by 59% in cumulative year-over-year volume as of June 30 compared to the same period last year.

As of the end of Q2, VAZKEPA is commercialized in 11 countries in Europe, including a recent launch in Romania, and Recordati continues to invest meaningfully with pricing, reimbursement, market access and adoption advancing in numerous additional countries across the licensed territory.

Under Recordati's leadership, VAZKEPA is in an early but promising stage of commercialization in Europe's large cardiovascular market, where the disease affects an estimated 62 million people and carries an annual economic burden of approximately EUR 282 billion across the European Union.

In-market demand in Europe for VAZKEPA under the Recordati partnership rose by 69% in Q2 2026 from Q2 2025. Spain and the U.K., though early, are leading commercial adoption, providing a strong foundation for future growth as pricing, reimbursement, and commercialization efforts continue across the broader territory.

In Italy, where Recordati has one of the country's most established pharmaceutical commercial organizations, VAZKEPA launched with significant commercial support and has demonstrated strong early uptake.

VAZKEPA is positioned by Recordati as a priority brand in its cardiovascular portfolio, backed by an expanded cardiovascular commercial infrastructure across Europe, including dedicated field representatives, medical science liaisons and marketing investment.

In its 2025 annual report, Recordati referred to VAZKEPA as a best-in-class treatment option that complements its existing cardiovascular portfolio, is supported by a robust clinical data package and makes a meaningful impact for cardiovascular patients with residual cardiovascular risk.

While driving utilization in launch markets, Recordati is actively progressing pricing, reimbursement, and market access across additional territories, building a meaningful base for long-term royalty and milestone growth as additional countries come online.

While very early, the commercial performance since the June 2025 licensing transaction is encouraging in that Recordati's established cardiovascular infrastructure, broader geographic footprint, and tremendous execution have unlocked substantially greater value from VAZKEPA than would have otherwise been possible had Amarin continued VAZKEPA commercialization throughout Europe alone.

The commercial momentum generated by Recordati thus far materially exceeds historical European growth rates achieved by Amarin prior to the licensing transaction.

As a reminder, European markets each follow their own regulatory process for pricing, reimbursement and market access, so commercial launches can progress at different speeds and under varying requirements across countries despite an overarching EU framework.

In the U.S., our core business continues to serve as a highly efficient tax-generating base with VASCEPA retaining a leading position in the icosapent ethyl market despite ongoing generic pressure.

We continue to expect to maintain our exclusivity with key payers through the end of 2026. The overall U.S. IPE market, based on third-party data, rose by 3% in Q2 2026 compared to Q2 2025.

VASCEPA's share of the market rose to 48% as of June 30, 2026, up from 43% in the same period last year.

Despite continued pricing pressure, VASCEPA branded prescriptions increased 14% year-over-year in the second quarter of 2026, reflecting continued commercial execution in a competitive market.

We expect U.S. volumes to remain stable through the end of 2026. Outside of Europe and the U.S., we continue to support our partners in advancing regulatory submissions in various other countries across Asia.

We recently received approvals in Singapore and South Korea and look forward to the launches in these territories in 2027.

As our international footprint continues to expand, the work of our medical affairs, regulatory, and R&D teams becomes increasingly important.

Beyond supporting Amarin's own scientific objectives, these teams provide critical expertise to our commercialization partners around the world to contribute to our joint success, helping them navigate local regulatory requirements, continuing to contribute to an already robust library of scientific evidence supporting the benefits and unique attributes of icosapentethyl, engaging with key scientific leaders, supporting reimbursement discussions, and preparing for successful product launches.

Through scientific exchange, congress participation, publication support, medical education initiatives and ongoing regulatory collaboration, these teams help ensure that our partners have access to the latest data and insights supporting VASCEPA as they work to improve access for patients in their respective markets.

To provide additional perspective on the scientific, medical and regulatory activities supporting our global growth strategy, I'll now turn the call over to Steve Ketchum. Steve?

Thank you, Aaron. Supporting our global commercialization strategy is an experienced medical affairs, regulatory, technical operations, and R&D organization that works closely with our partners throughout the product life cycle, from regulatory submissions and scientific exchange to market access and commercial launch.

Together, these teams help advance the science behind VASCEPA and VAZKEPA while enabling successful regional commercialization across our global partner network.

Our commitment extends well beyond supplying product. We believe sustained scientific leadership is one of the most important ways we create value for patients, health care providers and our partners.  

More than 7 years after the landmark REDUCE-IT results and more than 6 years after the U.S. approval of VASCEPA for cardiovascular risk reduction, we continue to invest in meaningful scientific research that expands our understanding of cardiovascular risk and reinforces the role of high-dose VASCEPA in contemporary clinical practice.

Beyond generating new evidence, our teams work closely with partners through publication initiatives, scientific congresses, key opinion leader engagement, launch planning, regulatory support and medical education, helping ensure they are equipped with the latest evidence to support successful commercialization and expand patient access across global markets.

That commitment is reflected in a steady cadence of scientific advancements, guideline recognition and partner-led educational initiatives that continue to strengthen the global evidence base for high-dose VASCEPA Icosapent ethyl.  

In May, we announced new data from a post-hoc analysis of the REDUCE-IT trial that was presented at the European Atherosclerosis Society, or EAS, Congress in Athens, Greece.

The analysis conducted in the REDUCE-IT placebo arm found that among statin-treated patients with elevated triglycerides, risk-weighted apolipoprotein B, or apo B, more effectively identified patients who remained at increased residual cardiovascular risk compared with traditional lipid biomarkers.

These recent findings add to the body of evidence that many high-risk patients continue to face substantial residual cardiovascular risk despite statin therapy and highlight the potential value of more refined lipid metrics to better identify patients who may benefit from evidence-based treatment.  

Prior findings from REDUCE-IT have shown that VASCEPA consistently reduced major adverse cardiovascular event risk across the spectrum of lipoprotein A levels, including in patients with elevated lipoprotein A, an increasingly recognized contributor to residual risk.

These previously published findings suggest that any future benefits from emerging lipoprotein A-lowering therapies may be complementary to the established cardiovascular risk reduction demonstrated with VASCEPA.

This growing body of evidence complements the continued recognition of high-dose icosapent ethyl and leading international treatment guidelines.  

Both the 2026 ACCAHA multi-society dyslipidemia guideline and the more recently released ACCAHA Multi-Society cardiovascular kidney metabolic syndrome guideline formally recommend high-dose icosapent ethyl for appropriate high-risk patients.

Together with recommendations from more than 70 medical societies worldwide, these endorsements underscore the strength of the evidence supporting VASCEPA and reinforce its important role in addressing residual cardiovascular risk.

Looking ahead, we remain committed to advancing the science that supports patients, clinicians and our commercialization partners.  

Early next month, we will support our Australian partner, CSL Seqirus, at the Cardiac Society of Australia and New Zealand, or CSANZ Annual Scientific Meeting in Sydney.

As one of the region's premier cardiovascular congresses, CSANZ provides an important forum for scientific exchange and physician education.

During the meeting, CSL Seqirus will sponsor a medical education session entitled Transforming Secondary Prevention after MI, Imaging Residual Risk and targeting what remains, featuring Professors Peter Psaltis and Adam Nelson, in addition to presenting many oral abstracts entitled Benefits of icosapent ethyl in patients with prior peripheral artery disease, REDUCE-IT-PAD.

We are proud to support these efforts as part of our broader commitment to advancing cardiovascular science and helping our partners educate clinicians with the latest evidence.  

Later in August, we will also participate in the European Society of Cardiology Congress in Munich. As one of the world's largest cardiovascular meetings, bringing together more than 33,000 health care professionals from nearly 170 countries, ESC provides an important platform to share new scientific findings.

We are pleased to have five scientific abstracts accepted, including multiple new REDUCE-IT analyses and mechanistic data that continue to deepen our understanding of the clinical benefits of high-dose VASCEPA.  

We also anticipate the release of the European cardiovascular kidney metabolic guideline during the ESC meeting, representing another important milestone for cardiovascular care and providing an additional opportunity to engage the global scientific and clinical community.

Our continued investment in science reflects a simple belief. Strong clinical evidence drives better patient care while creating long-term commercial opportunity.  

Beyond supporting current commercialization efforts, we continue to evaluate cost-effective opportunities to further advance the science of icosapent ethyl and explore potential future life cycle management initiatives.

While these efforts remain in the early stages and no development decisions have been made that are appropriate for public disclosure today, we believe disciplined scientific innovation remains an important component of long-term value creation. 

We will communicate developments when there are meaningful updates to share without setting unrealistic expectations.

By continually expanding the evidence base and providing our partners with ongoing scientific, regulatory, technical, operational and medical expertise, we are helping accelerate global access to VASCEPA and VAZKEPA, support successful commercialization across international markets and ultimately improve cardiovascular outcomes for patients worldwide.  

With that overview of our scientific progress and partner support activities, I'll turn the call back to Aaron.

Thanks, Steve. Before turning things over to Pete, I want to emphasize that the story we've altered is functioning as intended, with each chapter of execution adding momentum that supports the next phase of growth. 

We'll continue to advance our organic growth initiatives and execute with a high level of financial and operational discipline.  

Additionally, we continue to work closely with our exclusive financial adviser, Barclays, as we actively evaluate additional potential opportunities to enhance shareholder value.

Our commitment to patient care remains the foundation of everything we do, shaping our strategy, guiding our decisions and directing our investments.  

With that, I'll now turn the call over to Pete to take us through the numbers.

Thanks, Aaron. As Aaron mentioned, the benefits of our dual sales model and now completed restructuring plan are becoming increasingly clear with execution against three key priorities: advancing international growth through our partners, operating with a significantly lower cost base and continuing to strengthen cash generation.  

In summary, European product revenue increased from Q1 2026, and total operating expenses, excluding restructuring charges, materially declined from Q2 2025. 

We also generated positive cash flow for the third consecutive quarter and improved our cash position by $12 million from year-end 2025.  

Total net revenue in Q2 2026 was $42.2 million compared to $72.7 million in last year's second quarter, which included a $25 million upfront payment associated with the commencement of the Recordati transaction.

Product revenue was $39.1 million compared to $46.6 million. By geography, U.S. product revenue declined to $32.2 million from $36.5 million in Q2 2025, driven by ongoing pricing pressure in the competitive generic market, partially offset by higher product volumes. 

Importantly, despite this pricing pressure, the U.S. business remains profitable and continues to generate cash. Second quarter product revenue in Europe was $5.4 million under our new partner model and consisted entirely of supply shipments to a record high.

This compared to $6.6 million in the second quarter of 2025 under our previous sales model. Lower revenue despite the increased in-market demand of 69% reflected the transition to record high.  

Q2 2026 European revenue increased 11% from Q1 2026 and was up by 140% from Q4 2025. We're encouraged by this early momentum.

Rest of World revenue in Q2 2026 was $1.4 million, down from $3.5 million in the prior year period, reflecting normal variances across multiple geographies as these respective markets continue to develop.

Cost of goods sold in Q2 2026 rose 22% to $27.2 million from $22.4 million due to increased product volumes, primarily associated with regaining an exclusive PBM relationship in the U.S. beginning in Q3 2025.  

Lower operating expenses reflected the success of the now completed global restructuring, which we commenced in mid-2025. The decrease was in line with the previously announced approximately $70 million in annual cost savings and established a more efficient operating expense baseline.  

In Q2 2026, total operating expenses declined by 59% or $39.3 million to $27 million. Excluding the restructuring charge of $22.8 million in Q2 2025, total operating expenses decreased 38% from the prior year period.

We incurred no material restructuring charges in Q2 2026. Selling, general and administrative expense for Q2 2026 was $22.2 million, a 43% decline from $38.7 million one year ago. 

R&D expenses were in line with our ongoing commitments and our partners' ongoing expansion into new markets. R&D reflects our commitment to global regulatory support and to the science underlying our global branded product.

Our operating loss in the second quarter narrowed to $12 million from an operating loss of $16 million in last year's second quarter. Despite the increase in cost of goods for the quarter, we narrowed our operating loss by 25%.  

Turning to the balance sheet. We ended the quarter with cash and investments of $314.6 million, up from $303 million at year-end 2025, with no debt and working capital of $439 million.

Importantly, we generated $7 million of positive cash flow from operations in the second quarter, our third consecutive quarter of positive cash flow, and we continue to expect positive cash flow for full year 2026.

Given the stronger cash position and continued cash generation, I also wanted to briefly address our previously authorized share repurchase program.

We recognize that many shareholders are eager for an update, and we appreciate your continued interest. As we have discussed previously, the U.K. High Court approval obtained in connection with the authorization remains in effect through Q2 2029.

Since obtaining that approval in 2024, the business has evolved considerably. Today, we are operating from a stronger financial position with improved cash generation.

We understand our responsibility to deploy capital in a way that benefits shareholders. Capital deployment can take a number of forms, and we will continue to evaluate our options carefully and provide updates if and when there are material developments.

Disciplined inventory management remains a high operational priority and an important driver of cash flow and overall business health. As of June 30, 2026, inventory declined by $19.5 million from March 31, 2026, and by $31.8 million from December 31, 2025.

This reflects our multiyear approach to purchasing API at the appropriate time, considering manufacturing lead times, supply continuity requirements, and evolving demand trends across our markets.

This discipline allows us to support expected commercial demand while avoiding unnecessary working capital tied up in inventory. The business continues to strengthen, supported by key milestones achieved over the past year.

Under our new operating model, we are operating with a leaner cost structure, working capital discipline, and greater financial flexibility to support our U.S. profitability and sustainable international growth through our partners.

I now ask the operator to open the call to questions.

[Operator Instructions]

Your first question for today is from Paul Choi with Goldman Sachs.

Aaron, the first one is just on the reimbursement landscape in Europe. I appreciate that it's country by country. But in terms of the major markets, can you maybe give us an update on what still needs to be done in the various key geographies in Europe?

And then my second question for Peter is just on cost of goods coming in a little bit higher than I think the Street had been modeling. Can you maybe just help us understand if this is the sustainable rate that you're expecting given volume growth that you're anticipating here on a go-forward basis?

Paul, thanks for the question. Appreciate it, and thanks for joining us. Regarding Europe and reimbursement, as you noted, it's a different pace and different rate across all the countries.

So where we've launched, or now Recordati is commercializing primarily in the U.K., Spain, Portugal, as well as now getting off the ground in Italy. The reimbursement is there, always looking for ways to improve regionally.

But given the growth in end market demand, we're very pleased with where we are and how Recordati has made commercializing VASKEPA a priority. And they even noted the strong growth yesterday themselves in their earnings call.

They're also evaluating a number of other countries. I mean ultimately, we'd like to see the ability to launch in France; that would be, of course, sometime in the future.

But obviously, we have confidence in our partner to be able to do something there, but we just don't have an update at this time. As you know, it's a lengthy process there.

They have partnered with us in 59 countries. They're exploring a number of countries that we as Amarin would never even have considered, and some of those are sizable markets.

Hopefully, we'll see how that plays out, and we can get reimbursement in those countries and ultimately launch as well.

So off the ground early. Back to Italy, that's a very big omega-3 market. It certainly is one that Recordati knows extremely well, a very established, competent cardiovascular organization. And they're off the ground strong, and the more they get regional reimbursement and favorable reimbursement there, we're excited about what they can do there.

So overall, we're pleased with Europe. A lot of work to do, very early, 15-year partnership, as you know. And right now, we're extremely encouraged. Pete, do you want to touch on the COGS?

Yes. Thanks, Aaron. So as you know, COGS is calculated using a weighted average cost of our inventory on hand, which is primarily driven by our API for the volumes sold in the quarter.

When you look at the comparison from Q2 '26 to Q2 '25, the increase is due to regaining that PBM exclusive, which was effective in Q3 2025.

So when you look at Q3 compared to Q2 in 2026, that material variance, and also when you look at Q3 '25 to Q3 '26, that material difference, you should start to see it level off.

You're right that the primary driver is that increase in volume. But as we've talked about in the past, we've spent the last few years renegotiating the supply agreements that have enabled us to drive our inventory levels down to more appropriate levels, but it's also allowed us to manage the cost structure in our purchasing.

Your next question is from Jessica Fye with JPMorgan.

This is Jose on for Jess. On the licensing revenues of $3.1 million in the second quarter, curious if you're seeing any revenues from Recordati starting to roll in this year? And if so, what should we expect Recordati revenues to ramp up in the second half and beyond?

I'll comment on growth from an end market perspective, and then I'll have Pete talk about the revenue side of things. And as you know, we're not to give revenue guidance, but Pete will comment on that.

Obviously, the more that they grow in market demand, the greater the acceleration in revenue growth as well. The end market demand has been tremendous at 69% for Recordati for Europe, and they just got started.

So we're encouraged by what that will do. Obviously, the more we can help them, the more they invest in market demand, the more it will drive revenue. Pete, do you want to comment on the numbers on revenue specifically?

Yes. On the licensing revenue, that also includes royalty revenue. And so there is a portion of that that is made up from Recordati. There was $1.4 million in royalty revenue for the quarter, which is a growth from Q1.

So as you're seeing that end market demand growth, you're also seeing product revenue growth of 11% from Q1 '26. So we are seeing that growth. We're encouraged by the continued momentum in the early stages from Recordati. But yes, when you look at the licensing revenue line of $3 million, there is a portion of that related to Recordati.

We have reached the end of the question-and-answer session, and I will now turn the call over to Aaron for closing remarks.

Thank you, operator. We continue to have strong confidence in our strategy. We've got optimism about the scale of the opportunities that lie ahead, long-term partnerships, and a lot of untapped potential worldwide. And certainly, we have a tremendous product that continues to provide that benefit.

So we're executing extremely well. We've got enormous pride in our team, and the commitment and the progress that we're making with this new strategy, and we look forward to continuing to report those results to you.

So thank you all for joining us today. I appreciate you taking the time and look forward to keeping you apprised of our progress. Have a good day.

This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.

Good day, ladies and gentlemen, and welcome to the Amarin Corporation's First Quarter 2026 Results Conference Call. [Operator Instructions] And please note, this conference is being recorded.

I will now turn the conference over to your host, Mr. Devin Sullivan. Sir, you may begin.

Thank you for your time and attention this morning as we discuss Amarin's 2026 first quarter financial results. On the call today are Aaron Berg, President and Chief Executive Officer; and Pete Fishman, Chief Financial Officer. Other members of the senior management team will be available as needed during the Q&A session that will follow these prepared comments. Turning to today's agenda. Aaron will provide a state of the company, and Pete will walk through the numbers.

Before we begin, I'd like to remind everyone that today's press release and related quarterly report on Form 10-Q are available on the Investor Relations section of the company's website, www.amarincorp.com, as will a replay of this call shortly after its completion. Please be aware that during this call, we may make certain statements related to our business that are deemed forward-looking statements under federal securities laws. These statements are not guarantees of future performance, but rather are subject to a variety of risks and uncertainties. Our actual results could differ materially from expectations reflected in any forward-looking statements. Additionally, we assume no obligation to update these statements as circumstances change. For a discussion of the material risks and important factors that could affect our actual results, please refer to our SEC filings, which are available either on our company website or the Securities and Exchange Commission's EDGAR system.

With that said, I'd now like to turn the call over to Amarin's President and CEO, Aaron Berg. Aaron, please go ahead.

Thanks, Devin, and thank you all for joining us today. The momentum that started to build in late 2025 continued in the first quarter of 2026. Our results and cash generation in the quarter demonstrate our progress in advancing our new business model and expanding the global market for VASCEPA through our new and more efficient operating platform. We've substantially completed our previously announced global restructuring, and we remain on track to achieve the estimated $70 million in total operating expense savings by June 30, 2026.

Our financial position continued to improve. Our cash balance of $308 million rose from year-end 2025. We reported a second consecutive quarter of positive cash flow and ended the quarter with no debt.

2026 will be the first full year in which we've employed our new and more efficient operating model comprised of 2 distinct but complementary businesses, a well-established and durable commercial business in the U.S. that continues to generate meaningful revenue and cash flow and a fully partnered commercial strategy for all other markets. I'll now provide some high-level commentary on each business.

Our growth engine is comprised of a fully partnered international commercial strategy that's anchored by our exclusive license and supply agreement with Recordati. This relationship is focused in Europe, where we have IP protection through 2039 and covers 59 countries.

European revenue in Q1 2026 rose significantly from Q4 2025, reflecting the promise of this partnership. As of March 31, 2026, Recordati had commenced sales of VAZKEPA in 10 countries, including a Q4 2025 launch in Italy. Overall, commercial momentum in Europe continues to build, driven by growth in in-market demand in key launch markets. We remain encouraged by these early performance trends.

Lipid management in Europe is an increasingly important area of focus given the combination of aging populations, significant unmet need, evolving treatment standards and attractive long-term market potential. The potential for VAZKEPA to address the significant unmet need in cardiovascular disease beyond LDL lowering is similar to what we saw in the U.S. when we launched VASCEPA for cardiovascular risk reduction based on the strength of the REDUCE-IT trial. Recordati recognizes this as well and has prioritized the rollout of VAZKEPA in its active markets and those targeted for commercialization. We're also seeing continued growth in the rest of the world outside of Europe with our additional international partners, in China, Australia, Canada and the Middle East.

Also, as we discussed on our fourth quarter call, we're preparing for early 2027 launches in South Korea and Singapore, are monitoring regulatory reviews of previously submitted applications in Thailand and the Philippines. And following the submission of Vietnam in Q1 2026, we're on track to submit a new filing in Malaysia in Q2 2026.

Our U.S. team continues to operate the core business, which serves as a cash-generating base. As we've stated, while our U.S. franchise continues to see revenue declines due to the pressures of generic competition, VASCEPA remains the clear U.S. market leader across all available icosapent ethyl products more than 5 years after the introduction of a generic product. The overall IPE market based on third-party data rose by 3% in Q1 2026 compared to Q1 2025. Our share of the market rose to 48% at March 31, 2026, up from 42% in the same period last year. Most impressive is that VASCEPA branded prescriptions rose by 17% in Q1 2026 versus Q1 2025. The steps we've taken to rightsize our U.S. operations continue to allow our U.S. franchise to deliver efficient and profitable revenue. To that end, we expect to maintain our exclusives with key payers through the end of 2026, while also retaining coverage in our nonexclusive accounts.

This remarkable achievement is a testament to the hard work of our team members, the reputation of our brand and the growing library of supporting scientific evidence that validates VASCEPA's ability to reduce cardiovascular events by 25% when added to a stat.

In summary, both of our businesses are performing well. I ended last quarter's call by emphasizing the progress we've achieved to date and the important work that remains ahead. That message has not changed. What has changed is the building momentum behind our execution and the tangible progress we've delivered. We intend to continue to advance our organic growth initiatives and execute with a high level of financial and operational discipline. Additionally, we continue to collaborate closely with our exclusive adviser, Barclays, and exploring additional potential pathways to further enhance shareholder value.

Now let me talk about some additional VASCEPA developments. In late 2025 and early 2026, we highlighted new post-hoc analysis from the REDUCE-IT study of statin-treated patients with elevated triglycerides and known cardiovascular disease or with diabetes and other risk factors. In these analyses, treatment with VASCEPA on top of statin therapy significantly lowered cardiovascular risk across a diverse range of patient subgroups in the REDUCE-IT study, including in patients with cardiovascular kidney metabolic or CKM syndrome, in patients with common risk factors like hypertension, diabetes, smoking and hypercholesterolemia as well as in patients at extreme or very high risk for cardiovascular events.

Another analysis of REDUCE-IT showed that patients treated with VASCEPA on top of statin therapy experienced fewer total hospitalizations and fewer days lost due to hospitalizations and death during the study, providing additional insights on the effects of VASCEPA on patient-centered measures of total disease burden.

Everything we do as a company is guided by our commitment to reduce cardiovascular disease as the leading cause of death. We're encouraged to see increasing momentum around the importance of addressing the numerous risks associated with elevated triglycerides, driven by the growing body of clinical evidence linking elevated levels to cardiovascular risk, independent of LDL and by evolving guidelines that formally integrate triglyceride treatments into cardiovascular risk assessment and treatment pathways.

In March of this year, the American College of Cardiology, the American Heart Association and 9 other leading U.S. medical associations jointly issued an updated 2026 guideline for the management of lipids, including cholesterol and triglycerides. This updated guideline includes new recommendations based on high-quality evidence from major randomized controlled clinical trials that have been completed and published since the prior 2018 guideline, including our REDUCE-IT cardiovascular outcome study in VASCEPA.

Within this updated ACC/AHA clinical treatment guideline, icosapent ethyl is positioned as the only primary triglyceride-lowering medication that reduces cardiovascular event risk in combination with statin therapy in individuals at high risk of cardiovascular disease with moderate triglyceride elevations after achieving sufficient LDL lowering. This reinforces that patients on statin therapy can continue to experience residual cardiovascular risk driven by elevated triglyceride levels and underscores the need for complementary therapeutic approaches beyond LDL-lowering therapy alone in these patients.

Importantly, the guideline distinguishes therapies intended for pancreatitis prevention from those proven to reduce atherosclerotic cardiovascular disease events, reinforcing that cardiovascular outcomes, not biomarker changes alone must be the focus of and guide treatment decisions. For patients who remain at elevated cardiovascular risk despite optimized LDL therapy, the guideline supports the addition of evidence-based therapies specifically proven to reduce cardiovascular events such as icosapent ethyl.

This position is consistent with guidance from other cardiovascular societies, including the 2025 ESC EAS dyslipidemias guideline focused update, which states that high-dose icosapent ethyl as in the REDUCE-IT trial should be considered for high-risk or very high-risk patients with elevated triglyceride levels despite statin therapy to lower cardiovascular events. Together, these guideline updates reflect growing global consensus around the importance of addressing residual cardiovascular risk beyond LDL lowering alone. Against this backdrop, and as we've highlighted previously, the introduction of promising new therapies is also elevating awareness of triglyceride-associated risk, catalyzing doctor-patient conversations, changes in behavior and in some cases, prescribed therapies.

As a result, we believe VASCEPA is well positioned to benefit from the continued evolution of the lipid management landscape, specifically as it relates to the increasing attention on risks and unmet needs in patients with elevated triglycerides. I want to take a moment to explain why these developments may very well benefit sales of VASCEPA by strengthening its inclusion in the treatment flow from physician to formulary to patient.

More than 500 peer-reviewed publications validate the science behind VASCEPA, including its ability to reduce major adverse cardiovascular events across diverse patient populations, and this groundbreaking therapy has been prescribed more than 30 million times by over 250,000 health care professionals. For new patients, treatment often begins with an established lower-cost therapy that has proven effectiveness with newly approved premium-priced, sometimes injectable therapies typically reserved for patients who need additional options or fail initial treatment.

Coverage approval can reinforce this sequence through step edits requiring documentation that the preferred therapy was tried first before a costly alternative is authorized. VASCEPA taken orally is widely available, well established and supported by a clinically proven efficacy and safety profile. While the treatment landscape continues to evolve, our view remains straightforward. Therapies that are accessible today and backed by strong evidence should not be overlooked simply because newer options are gaining attention. Again, we applaud these new discoveries that may over time add to the array of options available to address this widespread health concern in patients at risk.

I ended last quarter's call by emphasizing the progress we've achieved to date and the important work that remains ahead. That message has not changed. What has changed is the building momentum behind our execution and the tangible progress we've delivered. We intend to continue to advance our growth initiatives and execute with a high level of financial and operational discipline.

With that, I'll now turn the call over to Pete to take us through the numbers.

Thanks, Aaron. Our results for the first quarter of 2026 reflected the continuing traction of our new business model and our global restructuring plan. Given the adoption of our new agreement with Recordati, I will, in some cases, also compare consecutive quarterly results, Q4 2025 to Q1 2026 to highlight recent progress.

Total net revenue in Q1 2026 rose to $45.1 million from $42 million in last year's first quarter. By geography, U.S. was consistent with Q1 2025. While volume was higher due to regaining exclusive status with a PBM beginning in Q3 2025, this was offset by pricing based on annual changes for payers. First quarter product revenue in Europe was $4.9 million under our new partnered model as compared to $5.4 million in the first quarter of 2025 under our previous sales model. Notably, Q1 2026 revenue was generated at a significantly lower cost with improved operating margins when compared to first quarter of 2025.

On a consecutive quarterly basis, Q1 2026 European revenue more than doubled, up 113% from Q4 2025 revenue of $2.3 million. European product revenue in the first quarter included $3 million of supply shipments to Recordati compared to $900,000 of such shipments in Q4 2025, reflecting initial stocking from the transition of our international commercial activities. With the transition now complete, going forward, Europe product revenue will come entirely from supply shipments to Recordati. Rest of World revenue in Q1 2026 was $2.8 million, whereas there were no supply shipments to our other partners in Q1 2025. As a reminder, our partnered model will result in revenue variability quarter-to-quarter, driven by the current scale of operations as well as the impact of launch timing, end market demand and the structure of individual partnership agreements.

Cost of goods sold rose by $10.5 million or 62%, reflecting increased product volumes associated with regaining an exclusive PBM relationship in the U.S. and the effect of shipments to our rest of world commercial partners, both of which did not exist in last year's first quarter. Looking ahead, on a comparative quarterly basis, we expect our cost of goods sold to continue to be higher until Q3 2026, the anniversary of regaining this exclusive relationship. Our expense profile continues to reflect the success of global restructuring we commenced in mid-2025.

In the first quarter, total operating expenses declined by 31% or $12.8 million to $29.1 million. Excluding the restructuring charge of $3.3 million, total operating expenses of $25.8 million declined by 38% from last year's first quarter. Q1 2026 operating expenses were relatively stable compared to Q4 2025 of $25.4 million.

SG&A declined by 42% and represented 47% of total net sales compared to 87% of total net sales in last year's first quarter. R&D expenses were in line with our ongoing commitment to global regulatory support and to the science underlying our global branded product. As noted above, restructuring expenses were $3.3 million, down from $4.1 million in Q4 2025, bringing our total restructuring expense to $39.6 million. We incurred the majority of these restructuring expenses through March 31, 2026, with the remaining nominal expense to be recognized in Q2 2026.

Our operating loss in the first quarter narrowed to $11.3 million from an operating loss of $16.8 million in last year's first quarter. Excluding restructuring charges, operating loss in Q1 2026 was $8 million. I also want to point out that despite the increase in cost of goods for the quarter, we were still able to drive down our total OpEx by 31% and excluding restructuring costs, cut our operating loss by more than 32%. I'll emphasize that it is early, but the Europe partnership model we adopted in 2025 is working.

Turning to the balance sheet. We ended the quarter with cash and investments of $308 million, up from $303 million at year-end 2025, no debt and working capital of $450 million. We generated positive cash flow from operations of $6.4 million in the first quarter, the second consecutive quarter of positive cash flow.

I would like to reiterate that we expect to generate positive cash flow for 2026. The business continues to evolve and improve, driven by key achievements realized over the past year. Under our new operating model, we rightsized the company to support both our U.S. business and our global partners in generating long-term international sales growth with an expense profile that is significantly lower than in prior years, reflecting the approximately $70 million in annualized savings to be achieved by the end of Q2 2026.

Thank you again, and I now ask the operator to open the call to questions.

[Operator Instructions] Our first question is coming from Jessica Fye with JPMorgan.

I was hoping you could talk about the right way to think about the trend in U.S. net price over the remainder of the year. And then also related to the expectation for positive cash flow in 2026, can you talk about the degree to which you see that as sustainable beyond '26?

Sure. Good morning, and thanks for joining us this morning. Pete, why don't you cover both the questions, the net price and cash flow beyond '26. I know we have confidence going forward and touch on those.

Right. Thanks, Aaron, and thanks for the question. For the U.S. NSP, as you've seen in past years, the bulk of our year-over-year change occurs in Q1. And as we look forward to the rest of the year, we'd expect the NSP volumes to be relatively consistent. As we've said in the past, this is driven by our exclusive contracts. We expect to keep them through the rest of 2026. However, if there are changes, that would have an impact there. For the cash flow expectations beyond 2026, we are confident that as we've turned into a cash flow positive position that, that will continue into the future. But that -- again, that is driven by how we retain those exclusive contracts. But we feel confident that we will continue this trend going forward.

Great. And can I ask just a couple of follow-ups on the expense side, and I appreciate the commentary you gave on the COGS trend. So I guess maybe the other side of that is just like the gross margin percentage over the remainder of the year that be kind of stable? Is that going to be a little lumpy depending on supply shipments, is that a good way to think about that? And then on SG&A, sort of if we exclude the restructuring charges, is that a good run rate from here? And I know you mentioned restructuring expense would be kind of nominal in 2Q. Does nominal mean a similar size to 1Q or is that something different?

Yes. So starting on the COGS, as mentioned, a piece of that is the -- regaining that exclusive. So as you look into Q2, that will have an impact on the comparative for our COGS amount. And you're right on overall COGS and gross margin. It will be in part dependent on the supply shipments to our partners. As you know, in that partnership model, it does have a different margin point than the U.S. business and will have an impact in that. And you saw that again in this quarter as we had greater supply shipments compared to Q1 of 2025 and saw that lower margin percentage compared to that comparative year.

On the SG&A side, excluding the restructuring, yes, this is a good way to look at that ongoing run rate. We'll continue to have the remainder savings as we've talked about in the past, but this is a good way to look at that run rate going forward.

And finally, as far as the restructuring, you should look at that as a pretty nominal amount compared to past quarters and would not be at the same levels that you saw in the Q1 of the $3 million. It will be lower than that.

Our next question is coming from Paul Choi with Goldman Sachs.

I know it's early days since the most recent guidelines were issued. But Aaron, can you maybe just comment on physician feedback and any change in thought processes with regard to utilizing VASCEPA in light of the guideline changes? And then I have a follow-up as well.

Sure. So the guidelines, and it's also combined with news we've had over the last -- really over the last year, which saw -- the fibrate change. As you'll recall, we've spoken about, Paul, previously, where the label change and the emphasis on the fact that fibrates do not provide cardiovascular risk reduction yet. They're widely used in combination with statin for cardiovascular risk reduction. So that's one thing. That was also noted in the guidelines. And then this increasing focus around triglycerides, patients with elevated triglycerides and the risks of those patients. And as you know, there's a significantly increasing focus, and that also is noted in the guidelines. So qualitatively, what we're seeing from all of this and what we're hearing is very positive. Right now, it's qualitative. It will take time as these guidelines do and as news does for it to actually impact growth. And there are a number of dynamics that are related to all of these that are impacting growth, in particular, also, as we've noted previously, now with some of these newer triglyceride-lowering agents, these very good agents for FCS and severely high triglycerides, a lot of the payers are stepping them through existing triglyceride-lowering drugs, proven effective approved drugs like VASCEPA. So that will also wind at our back a little bit. So it will take time for all these to play out. Hard to quantify exactly what it will be, but it's all very timely. It's all happening at once, and it's very positive. I've got Steve Ketchum here with me as well. And Steve can speak to the guidelines and what the scientific community is saying about the impact as well.

Yes. Thanks, Aaron. Yes, we do see, Paul, these updated guidelines, both in the U.S. from the American College of Cardiology, American Heart Association, that were issued in March 2026. And of course, they're also consistent with the European equivalents that were issued last August. And although our REDUCE-IT results have been published back in 2018, 2019 time frame, that's when the prior version of this guideline, this dyslipidemia guideline was released, and it had not yet incorporated the REDUCE-IT results in other landmark cardiovascular outcomes trials such as those that showed that fibrates did not add any benefit on top of statin therapy. So we see these, as Aaron mentioned, as important, timely and major updates that position icosapent ethyl as an important consideration for patients with elevated triglycerides and that cardiovascular risk. So we see it as an exciting development.

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Yes. My follow-up is, as you transition to consistent cash flow profitability over the coming quarters, just with the stock price where it is, can you maybe just provide your -- maybe your high-level thoughts or maybe the Board's thoughts on -- in the future, returning some of this cash to shareholders as it starts to accumulate either in one form or another possibly?

Sure. That's a topic we talk about on a regular basis. As we've mentioned previously, we have -- we've been working with Barclays as our exclusive adviser and looking at strategic opportunities to capitalize on the value of the company. We feel like we've put the company on very sure footing, cash flow positive moving forward and sitting on that cash. But clearly, there are some things we can do to extract value. What shape or form that is yet to be determined because we're not in any type of desperate situation. We are being opportunistic, and we're focused on value for shareholders. In that context, cash -- buyback, cash back to shareholders, of some sort is a concept that is being discussed and could possibly happen at the right time. But we're thinking more holistically, strategically about the total value of the company. And when we have something tangible to report, we'll certainly do so.

Our next question is coming from Michael Ahn with Leerink Partners.

This is Michael on for Roanna Ruiz at Leerink Partners. I have two questions today. The first one is, do you have any update on your strategy around launching an authorized generic and what would trigger that decision? And the second question is, what's the underlying growth demand in the rest of the world market? And are there any milestone payments from rest of the world market that you're expecting in 2026?

Michael, so regarding the authorized generic, we've been -- we've done very well maintaining our branded business profitably in the U.S. We're incredibly efficient, maintaining the lion's share of the IPE category, and we're doing so with the strategy that we implemented a number of years ago, which is focusing on payers and the exclusives. That's proven to be very beneficial. And given that we've been able to maintain the exclusives and we believe we're maintaining those exclusives at least through 2026, then we don't believe that it's in our best interest to launch an authorized generic at this time, even though we're ready to do so when the opportunity arises.

Once we find we can't compete any longer with this strategy, then that would be the opportunity to launch an authorized generic. But we've said this over the last couple of years, and being prepared to do so, but the strategy has paid off. We've been very patient. We haven't overreacted to the market, and that's turned out to be a very wise approach given how our financial results are and the revenue we're generating in the U.S. by investing very little in the U.S. So that's where we are with the AG. Once we feel the market dynamics turn, then we'll certainly do so. We see that as an opportunity to generate revenue, generate cash into perpetuity, frankly, as long as there's an IPE category and we have an authorized generic that can be distributed. Regarding growth in rest of the world and milestone payments, I'll let Pete address what's going on there and tied to into those partnership agreements.

Thanks, Aaron. We have been pleased with the end market demand growth within each of the regions and our partners. We have seen that consistent growth throughout. It is early stages in most of these markets. So we'll continue to monitor that, and we have been working very closely with each of our partners to support them in that growth. As far as the milestone payments go, we haven't been providing specific guidance around those growth. And there are milestones, as we've talked about with Recordati, for example, based off of in-market sales for them that will trigger milestones. But at this time, haven't been providing specific guidance on that outside of just that we've been pleased with what -- with each of our partners and what they've been able to accomplish to date.

And we're at the early stages, too, right? I mean it's -- again, as you said, it's kind of the tale of two companies. The U.S. is at one end of the life cycle. But in so many of these other regions, we're just getting going. And we've got very good partners. They've made VASCEPA/VAZKEPA a priority. We're really fortunate to have these partners, and our job is simply to execute and support them, but we look forward to what they can do, and they're certainly committed.

As we have no further questions in the queue at this time, this will conclude our question-and-answer session. And I would like to turn the call back over to Mr. Berg for any closing remarks.

I'd just like to thank everyone for participating today. I hope that we've been able to communicate the progress that we've made and our confidence about Amarin moving forward. We look forward to keeping you updated about our progress. And again, thank you for the continued interest in Amarin. Have a good day.

Thank you. Ladies and gentlemen, this concludes today's call, and you may disconnect your lines at this time. And we thank you for your participation.

Welcome to Amarin Corporation's Conference Call to discuss its Fourth Quarter 2025 Financial Results. [Operator Instructions]. Please note, this conference is being recorded. I would now like to turn the conference call over to Devin Sullivan, Investor Relations for Amarin.

Thank you for your time and attention this morning as we discuss Amarin's 2025 Fourth Quarter and Full Year Financial Results. On the call today are Aaron Berg, President and Chief Executive Officer; and Pete Fishman, Chief Financial Officer. Other members of the senior management team will be available as needed during the Q&A session that will follow these prepared comments.

Turning to today's agenda. Aaron will provide a state of the company, and Pete will walk through the numbers. Before we begin, I'd like to remind everyone that today's press release is available on the Investor Relations section of the company's website, www.amarincorp.com, as will a replay of this call shortly after its completion. Our annual report on Form 10-K will also be available in the Investor Relations section of the website in the coming days. Please be aware that during this call, we may make certain statements related to our business that are deemed forward-looking statements under federal securities laws. These statements are not guarantees of future performance, but rather are subject to a variety of risks and uncertainties.

Our actual results could differ materially from expectations reflected in any forward-looking statements. Additionally, we assume no obligation to update these statements as circumstances change. For a discussion of the material risks and important factors that could affect our actual results, please refer to our SEC filings, which are available either on our company website or the Securities and Exchange Commission's EDGAR system. With that said, I'd now like to turn the call over to Amarin's President and CEO, Aaron Berg. Aaron, please go ahead.

Thanks, Devin. 2025 was a year of substantial achievement for Amarin. The strategy we've been developing to transform our business model and expand the global market for our VASCEPA/VAZKEPA franchise took shape and began producing measurable results. Midyear, we established our exclusive long-term partnership with Recordati to commercialize VAZKEPA across Europe with the overarching goal of better capitalizing on the untapped potential of VAZKEPA to tackle the growing challenge of cardiovascular risk worldwide.

This strategy was the catalyst for us to examine the entirety of our operations and identify areas where we could realize significant and durable efficiencies that would support the strategic pivot. Our expectation is that this combination of a refined strategy via our relationship with Recordati and enterprise-wide operating efficiencies generated by our global restructuring will result in a whole that is greater than the sum of its parts, allowing us to efficiently generate revenue and cash flow globally and position us to be a stronger, leaner operation.

We are very pleased with the progress to date. For full year 2025, we achieved a significant reduction in our operating expenses, generated positive cash flow earlier than anticipated and maintained a debt-free balance sheet and ample cash balance. As of December 31, 2025, we realized approximately half of the estimated $70 million in total operating expense savings associated with our global restructuring plan and expect to achieve the full savings benefit from these initiatives by June 30, 2026, as planned.

While there's still work to be done, we are operating from a much stronger position due to the hard work and dedication of our exceptional team. The operational progress we made this year reflects their shared commitment to enhancing long-term shareholder value. Everything we do as a company is driven by our commitment to reduce cardiovascular disease as a leading cause of death with approximately 30 million total prescriptions written since the launch of VASCEPA in 2013 and a large and growing library of validating studies, analyses and scientific evidence that support VASCEPA's ability to reduce cardiovascular events by 25% when added to a statin, we remain confident in the durability of our core franchise and its global growth potential.

In the U.S., VASCEPA has retained clear market leadership across all available icosapent ethyl products branded and generic, a remarkable achievement 5 years since the first generic product was introduced. We maintained all major managed care exclusives through 2025 and successfully regained exclusive status midyear with a large national PBM. Our continued revenue generation reflects the effectiveness of our commercial strategy as well as our success in maintaining market share leadership due to both accessibility and affordability.

We know from our experience with VASCEPA in the U.S. that Europe offers a significant growth opportunity because of the growing awareness about lipid management protocols and the need for therapies that address cardiovascular disease, which is the #1 killer globally and on the rise across the world. While our team in Europe made very good progress in various markets, as we considered our options to address this promising opportunity for the future, it became clear that the best way to accelerate and maximize access to this large untapped market, where we have IP protection through 2039 was via a partnership with an established leader in cardiovascular disease in Europe.

Our exclusive long-term license and supply agreement with Recordati, which commenced in Q3 2025, includes commercializing VAZKEPA across 59 countries with a focus in Europe. This agreement has significantly transformed our international commercial strategy into a fully partnered model comprised of 7 parties in close to 100 countries. This approach is designed to generate substantial economies of scale and offer significant revenue opportunities while providing extensive infrastructure and commercial experience. Recordati is now fully managing European promotional activities for VAZKEPA. As a result, we're providing this therapy with greater effectiveness and efficiency to an expanded international patient population. I'd like to share with you some of the initial highlights from this agreement. Delivered immediate meaningful financial value, including a $25 million upfront cash payment for Recordati with eligible future milestone payments totaling up to $150 million with the first milestone payment contingent upon Recordati achieving annual net sales of $100 million.

Commercial momentum continues with both volume and end market demand growing across all launch markets. Commercialization was advanced in Italy, a key market, initiating sales efforts and building on Amarin's strong pre-deal groundwork for pricing and reimbursement. Expanded patient access, including securing pricing and reimbursement in 2 additional countries, Austria and Slovenia. We positioned for further European expansion with Recordati actively evaluating additional launch opportunities and timing broadly across the full 59 country territory. Outside of Europe, our partners continue to make progress in their respective regions. Of note, together with our partner, Lotus, we secured 2 regulatory approvals in 2025, South Korea and Singapore and are preparing to launch in these countries in the future. We expect the regulatory reviews of previously submitted applications in Thailand and the Philippines will be significantly advanced by the respective local authorities across 2026 with the new regulatory filings to be made in Vietnam and Malaysia this year.

Overall, the success of our partners is fundamental to our global strategy of making VASCEPA available to the millions of patients in need of cardiovascular risk reduction today. Supported by more than 500 peer-reviewed publications, science is the foundation of everything we do, providing both us and our partners with robust credible evidence to support confident decision-making and long-term patient impact. It guides our decisions and underpins our continued investment in analyses that further explore and validate VASCEPA's ability to reduce major adverse cardiovascular events across diverse patient populations, further strengthening its established therapeutic value.

We ended 2025 having supported a total of 45 abstracts, posters and papers that further expanded the body of knowledge for our product. Our most recent publications in late 2025 and 2026 include 3 REDUCE-IT post-hoc analyses that were previously presented at major medical congresses. We had 2 papers published online in the American Journal of Preventive Cardiology or the AJPC. The first demonstrated that icosapent ethyl reduced cardiovascular risk in patients with baseline characteristics of cardiovascular, kidney metabolic or CKM syndrome.

The second showed that icosapent ethyl reduced the rate of cardiovascular events across a range of standard modifiable cardiovascular risk factors that included hypertension, diabetes, smoking and hypercholesterolemia at baseline for established cardiovascular disease patients. A third paper published online in the European Journal of Preventive Cardiology or EJPC, demonstrated that icosapent ethyl treatment in the REDUCE-IT study was associated with fewer total hospitalizations and increased the chances of an individual living without hospitalization. We look forward to sharing more about this paper soon, which provides additional insights on the effects of icosapent ethyl on patient-centered measures of total disease burden.

In addition, we're preparing to attend the American College of Cardiology Scientific Sessions in New Orleans from March 28 to 30, where we and our collaborators will present a new REDUCE-IT patient subgroup analysis and additional mechanistic data on EPA's multifactorial biologic activities.

We expect to share more details as we approach the ACC conference. Building on the substantial body of evidence we've generated and supported this year, we're also encouraged by the ongoing progress across the complex lipid and lipoprotein research landscape. Recent FDA breakthrough therapy designations highlight the growing recognition of the risks associated with elevated triglycerides and the need to address them. Innovation is reshaping the future of cardiovascular care with promising research into multiple pathways. And as this landscape evolves, we believe VASCEPA remains uniquely positioned for sustained relevance and growth. While multiple forces are shaping today's treatment environment, our perspective is straightforward.

Currently available proven, safe and evidence-backed therapies are often overlooked as attention shifts to new innovations, but should not change the reality that some of the most effective treatment options are those that have consistently delivered meaningful outcomes over many years, including VASCEPA. Such conviction is supported by 2 key factors. Firstly, the FDA's recent update, the fenofibrate labeling marks a meaningful turning point in regulatory clarity. While fenofibrates remain approved to lower triglycerides in patients with severe hypertriglyceridemia, the updated label reflects what decades of outcomes data have shown. Fibrates do not reduce cardiovascular events even when added to statins. While fibrates continue to be prescribed frequently for patients in conjunction with statins to reduce cardiovascular events, this clarification is helping reset expectations across the health care system and reinforcing a shift toward therapies supported by proven clinical outcomes, not simply biomarker changes.

Against this backdrop, VASCEPA stands apart as the only FDA-approved oral therapy with indications for both severe hypertriglyceridemia and cardiovascular risk reduction with the demonstrated ability to reduce the risk of major cardiovascular events by 25% when added to statin therapy in appropriate patients as shown in the REDUCE-IT cardiovascular outcomes trial. As prescribers and payers increasingly align decisions with evidence-based medicine, this differentiation becomes even more important, especially with nearly half of all U.S. adults affected by cardiovascular disease. Secondly, as research activity across lipids and lipoproteins expands, we believe it continues to highlight the role of established proven options such as VASCEPA.

As we mentioned previously, we're closely monitoring payer-driven step therapy dynamics as premium-priced injectable triglyceride-lowering therapies enter the market. In many cases, payers are already requiring patients to step through approved, established lower-cost options before accessing newer agents. Historically, this type of formulary design has driven broader use of proven oral therapies, and we believe a similar dynamic is likely to emerge in severe hypertriglyceridemia. Taken together, these developments reinforce our confidence in the global opportunity for the VASCEPA franchise grounded in outcomes-based evidence. All that said, we've entered 2026 with an established U.S. therapeutic franchise that continues to deliver life-saving results supported by industry tailwinds, emphasizing widely available cost-effective treatments such as VASCEPA as a crucial part of preventing cardiovascular disease in patients with elevated triglycerides.

We have what we view as a significant growth driver via our relationship with Recordati that has strengthened our presence in Europe and helped define our fully partnered international commercial strategy. We significantly lowered our corporate expense base and enjoy a financial position that ranks among the strongest in our recent history. At the same time, the Board and management with the assistance of our exclusive adviser, Barclays, will continue to explore value-enhancing strategic opportunities. We've come a long way over the past year, addressing challenges and meeting opportunities head on and emerging stronger.

But I'll say it again, we still have much work to do. 2026 will be a pivotal year for Amarin. Working to defend our U.S. franchise, working efficiently and effectively to expand our global presence through our international partnership model and working to stay the course to unlock sustainable long-term value for shareholders. I'm confident that we have the right product, strategy and team in place to meet these objectives and position the company for long-term success. As the year progresses, we expect to be able to provide greater insight to our progress and look forward to sharing that with you. With that, I'll now turn the call over to Pete to take us through the numbers.

Thanks, Aaron. Our results for 2025 reflected the initial success of our global restructuring plan, specifically with respect to optimizing our operations and creating a platform for sustainable, efficient growth. For the fourth quarter of 2025, total net revenue was $49.2 million compared to $62.3 million in last year's fourth quarter. By geography, U.S. sales declined 7% due to a decline in net selling price, driven by proactive pricing to align with market dynamics. Looking ahead, we typically see the majority of the full year U.S. decline in volume in the first quarter of the year based on annual changes for payers.

As we continue our transition of commercial activities to Recordati in the fourth quarter, product revenue for Europe was $2.3 million, including $900,000 in supply shipments to Recordati. This revenue was generated at significantly lower costs compared to the $4 million of direct sales in the fourth quarter of 2024. Once the transition is complete, Europe product revenue will come entirely from supply shipments to Recordati. Rest of World revenues were $3.1 million compared to $11.9 million in last year's fourth quarter. This variance was driven by the impact of $7.8 million in stocking orders in the last quarter of 2024 in advance of market launches.

Importantly, we continue to see end-market demand growth across all launch geographies, evidenced by the year-over-year increase in our royalty revenue. While early in most markets, we are pleased by our partners' focus on expanding the reach of VASCEPA. In particular, we are encouraged by the commitment and results from the Recordati team, especially maintaining momentum during this transition. And we look forward to accelerated in-market growth as they expand their commercial efforts and footprint.

As a reminder, our partnered model will result in revenue variability quarter-to-quarter, driven by the current scale of operations as well as the impact of launch timing, in market demand and the structure of individual partnership agreements. Moving to our expenses. The global restructuring we announced in mid-2025 produced meaningful cost savings in the fourth quarter. Total operating expenses declined by 31% or $13.5 million. By category, cost of goods sold declined by 63%, reflecting 2024 onetime inventory write-offs as well as the restructuring impact from negotiations of our supply agreements.

Excluding these onetime items, costs declined by 10%. SG&A declined by 46% and represented 41% of total net sales compared to 59% of total net sales in last year's fourth quarter, reflecting the early benefits from our global restructuring. R&D expenses were stable, in line with our ongoing commitments to global regulatory support and to the science underlying of our global branded product. Restructuring expense was $4.1 million, down from $9.4 million in the third quarter of 2025, bringing our total annual restructuring expense to $36.2 million. As previously announced, we expect to incur the last of these expenses in early 2026. Excluding the restructuring charge of $4.1 million, total OpEx declined by 41% from last year's fourth quarter.

Our operating loss in the fourth quarter narrowed to $2.3 million from an operating loss of $16 million in last year's fourth quarter, excluding restructuring charges in both periods. Turning to the balance sheet. We generated positive cash flow from operations of $7 million in 2025, ending the year with $303 million in cash and investments, no debt and working capital of $455 million. I'll echo what Aaron said earlier, 2026 will be a pivotal year for Amarin. It will also be a period of transition and recalibration, defined largely by the first full year of our partnered model in Europe.

We are confident that our financial position will support our business activities for 2026, including the normal first quarter seasonality in the U.S. and quarterly fluctuations in revenue from supply shipments inherent in partnership agreements. We expect to generate positive cash flow for the full year in 2026 through cost-efficient revenue generation with our U.S. franchise and our new international business model, while operating with a significantly improved OpEx profile, reflecting an approximately $70 million in annualized savings to be achieved by the end of Q2 2026. Thank you again for your attention. And I'd now ask the operator to open the call to questions.

[Operator Instructions]. Your first question for today is from Roanna Ruiz with Leerink.

This is Michael on for Roanna Ruiz at Leerink Partners. Our question is like could you provide more color on the volume versus price dynamics in 4Q? And given that like there seems to be a net pricing pressure, has the calculus on launching an authorized generic changed at all? And what would the trigger look like?

Thank you, Michael. It was a little bit hard to hear, but do you say volume versus price? Are you talking about the U.S.?

Yes, that's correct.

Pete, do you want to comment on?

Yes. In Q4, our volume and price compared to Q3 remained relatively consistent. So we have seen that consistency. As mentioned, when we look into '26, that's when in the first quarter, we typically see that initial bump, the bulk of our volume decline. And from a pricing perspective, we always have some pricing pressure as we deal with the market dynamics related to being in the generic environment.

The volume normalized, it tends to flatten. So we take the -- as we've seen in Q1 each year, there's more volume pressure in Q1, but that tends to level out going into Q2. And the pricing as the year goes on should also be relatively consistent. Just again, a reminder, we're focused on exclusives. And as long as we maintain those exclusives, then it should be fairly consistent. It's a dynamic market, a number of generic competitors and things can happen during the year, but we're confident we're starting the year well with our exclusives in place.

And the strategy continues to work here in the U.S. where we're focused on payer access and not as much on the sales and marketing effort, as you know. So strategy is working, looking forward to continuing to generate cash profitable revenue here in the U.S. for 2026.

Your next question for today is from Paul Choi with Goldman Sachs.

This is Daniel on for Paul. So we have a question on for 2026 in the U.S., how confident are you able to sustain exclusivity with your existing exclusive formulary?

Thanks, Daniel. So we're now 5 years into the introduction of a generic. And at the beginning of each year -- the end of each year and beginning of each year, we say how long can we maintain it? And our team has done an exceptional job. We've started the year maintaining our exclusives. We're confident that we can maintain them through the year.

But we also know that, for example, in 2024, in the middle of the year, we lost of EVM, but got it back in 2025. So it can be relatively dynamic, but we're starting the year in a confident position with our exclusives in place, and we continue to be profitable. So we look forward to a good year.

We have reached the end of the question-and-answer session, and I will now turn the call over to Aaron for closing remarks.

Yes. Thank you. Thank you all for your interest in Amarin and for taking the time to listen to us today. Appreciate it. Have a good day.

This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.

Welcome to Amarin Corporation's conference call to discuss its third quarter 2025 financial results. I would like to turn the conference call over to Bob Burrows, Investor Relations for Amarin.

Good morning. Again, I'm Bob Burrows, Amarin's Investor Relations contact. For those that don't know me, for nearly 30 years, I've served as an in-house Investor Relations Officer at various public companies, and I've been a consultant for the Amarin team since August of 2024. Thank you for your time and attention this morning as we discuss Amarin's third quarter of 2025 financial results. Joining me with prepared comments are Aaron Berg, President and Chief Executive Officer; and Pete Fishman, Chief Financial Officer.

Other members of the senior management team will be available as needed during the Q&A session that will follow these prepared comments.

Turning to today's agenda. Aaron will provide a state of the company, and Pete will walk through the numbers. In terms of important housekeeping, please take note of the following. Today's press release and related quarterly report on Form 10-Q are all available on the Investor Relations portion of the company website. An archive of this call will be posted on the Investor Relations portion of the company website shortly after the call. And finally, please be aware, during this call, we may make certain statements related to our business that are deemed forward-looking statements under federal securities laws. These statements are not guarantees of future performance, but rather are subject to a variety of risks and uncertainties. Our actual results could differ materially from expectations reflected in any forward-looking statements.

Additionally, we assume no obligation to update these statements as circumstances change. For a discussion of the material risks and important factors that could affect our actual results, please refer to our SEC filings, which are available either on our company website or the Securities and Exchange Commission's EDGAR system. And with that, I'd like to turn the call over to Amarin's President and CEO, Aaron Berg. Aaron?

Thank you, Bob. Good morning, everyone, and thank you for joining us. My comments today will focus on 3 themes: what we've done to get to this point, how the business is operating today and most importantly, where we're going and why it's compelling as an opportunity for all our stakeholders.

First, a recap of the series of critical strategic steps we've taken to solidify our core business and position us for the future. With the announced partnership with Recordati in June of this year, we transitioned to a fully partnered commercial model across international ex U.S. markets. We're now focused on leveraging a global syndicate of 7 reputable and well-established partners with significant geographic expertise covering a total of close to 100 markets worldwide.

What's particularly exciting is the fact that we're still early in the life cycle in many countries, especially key European markets where VASCEPA benefits from extended patent protection until 2039, and there remains significant untapped potential for high-risk cardiovascular disease patients.

Critically, the long-term partnership for the European business enables us to capitalize on the capabilities and synergies of Recordati in Europe to efficiently generate revenue and build on the great foundation our team built over the past several years. This was the right step at an opportune time with a very strong partner and the culmination of a series of strategic moves that have solidified our business foundation while also enabling the potential for a more accelerated expansion of the product to more patients.

All of this has been done in direct alignment with our mission of doing all we can to reduce the cardiovascular disease burden for patients and communities around the world. In concert with partnering the European business, we took the painful but necessary step to implement an organizational restructuring that has resulted in rightsizing our operating footprint globally. As discussed previously, we look to realize aggregate OpEx savings of $70 million over the next year, the impact of which has begun to flow through in this latest reporting period, and we're now better positioned for the next phase of growth and value creation.

As of today, the European transition with Recordati has progressed exceptionally well. During the quarter, the Amarin and Recordati teams completed the knowledge transfer and established working connections with all in-market country teams, resulting in what has been a very smooth handoff. We anticipate Recordati to be fully managing European commercialization and promotion in all launch countries by the end of 2025.

Overall, since the signing of the Recordati partnership, momentum has been sustained throughout the commercial transition as both volume and demand continue to grow across all commercialized European markets. We remain extremely confident in Recordati's ability over time to accelerate the depth and reach of VASCEPA for patients across Europe who are at risk for cardiovascular event. And we look forward to providing a further update on this front when we report year-end 2025 results in early 2026.

Pivoting to the opportunities across the rest of the world markets. We're continuing to actively support our partners' ongoing initiatives to expand patient access in these key additional growth geographies. Our partners are focused on driving patient uptake by highlighting the tremendous value and potential for VASCEPA in their respective markets and continue to make progress in commercialization and regulatory processes locally. Overall, success of our partners in both Europe and rest of the world is fundamental to our global strategy of making VASCEPA available to the millions of patients in need of cardiovascular risk reduction today.

All our partners are leveraging their established infrastructure, capabilities, people and passion to drive growth in our core franchise and to maximize its global reach. The pieces are now firmly in place, and we're excited by what the future will bring as these initiatives continue to progress.

Turning to the U.S. business. We continue to manage and maintain this important commercial arm of the company. Through the end of the quarter, VASCEPA stood at greater than 50% share of the IPE market, a remarkable achievement 5 years since the first generic product was introduced. In addition, we retained the major exclusive accounts. And as of July 1, we regained exclusive status with a large national pharmacy benefit manager.

As expected, this shift positively impacted volumes with minimal revenue impact. Based on the current market dynamics and feedback from key accounts, we're confident we will retain our major exclusives at least through the end of 2025. Since our exclusive accounts deliver the majority of our U.S. product sales, we continue to work with payers to keep VASCEPA affordable and provide patient access to the sole branded product within a diverse competitive market.

Overall, we have consistently and aggressively pursued a strategy to remain competitive. We'll continue to take the right steps to manage the VASCEPA brand moving forward, always with patients at the center of our strategy. Our focus remains on maximizing both the clinical impact of VASCEPA for cardiovascular risk reduction and the financial strength of the U.S. business.

From a scientific perspective, we continue to demonstrate our commitment to advancing cardiovascular care through a sustained and consistent presence at major medical meetings. This quarter, we not only supported partners in their own efforts around medical meetings, but also marked our strongest presence ever at the European Society of Cardiology 2025 Conference.

At ESC 2025, we had 5 accepted abstracts presented and importantly, VAZKEPA was again included in the 2025 ESC EAS dyslipidemia guideline focused update, which reaffirmed high-dose Icosapent ethyl as a Class IIa recommended therapy for high-risk or very high-risk patients based on the landmark REDUCE-IT results.

These insights are a direct result of our sustained commitment to generate meaningful data that informs clinical practice and supports our mission to address residual cardiovascular risk, a persistent threat to millions of patients worldwide. Cardiovascular disease remains the leading cause of death globally and far too many high-risk patients remain vulnerable despite being treated with standard of care therapies.

Given this reality, it's well understood that addressing cardiovascular disease is a complex challenge, one that many stakeholders across the health care ecosystem are working to solve. And as a result, the science related to heart disease is continually evolving. As a case in point and as we commented on Monday of this week, we're deeply appreciative of the FDA's recent action to revise the labeling of fenofibrates prompted by the HealthyWomen's Citizens petition.

These drugs have been used for decades under the belief they reduce major cardiovascular events, leaving patients thinking they're receiving appropriate care. Yet multiple large cardiovascular outcome trials have shown that fibrates and another related fibrate compound failed to reduce those events even in high-risk patients on background statin therapy.

The updated labeling now includes a clear statement on the lack of cardiovascular benefit, relevant safety data and a refined indication as follows: "Fenofibrate did not reduce cardiovascular disease morbidity or mortality in 2 large randomized controlled trials of patients with type 2 diabetes mellitus. Risk for rhabdomyolysis is increased when fibrates are co-administered with a statin, avoid concomitant use unless the benefit of further alterations in triglyceride levels is likely to outweigh the increased risk of this drug combination. Fenofibrates are now indicated for the reduction in elevated LDL-C in adults with primary hyperlipidemia when use of recommended LDL-C lowering therapy is not possible."

This FDA action is crucial because fibrates remain widely prescribed with more than half of fibrate patients also on statins. The FDA concurs that there is no scientific justification for suggesting that statin-treated patients may benefit from the addition of fenofibrate. The FDA also supports updating fenofibrate labeling to reflect findings from the prominent cardiovascular outcomes trial, which evaluated another fibrate compound.

This revision marks a critical step toward lasting reform in prescribing practices and a renewed opportunity to ensure patients receive the care they require by shifting clinical practice away from treatments that lack cardiovascular benefit and toward effective and safe therapies backed by robust outcomes data.

As we've long advocated, cardiovascular risk reduction must be rooted in proven outcomes, not solely on improving biomarkers such as reducing triglycerides in patients with elevated triglycerides. The FDA's decision reinforces this principle, helping to correct long-standing misperceptions and guiding health care providers, payers and patients toward evidence-based care that truly provides cardiovascular protection.

Our data continues to validate the role of VASCEPA in reducing major adverse cardiovascular events across diverse patient subgroups. These findings not only strengthen the scientific foundation, but also underscore the urgency of delivering proven therapy to those who need protection now.

With that, let me finish with where this all leads and what we see for the company going forward. Looking ahead, we see significant untapped potential for the company. With patients at the core of our mission, VASCEPA stands as a globally differentiated and complementary asset, clinically proven to reduce cardiovascular risk and uniquely positioned to unlock significant value across underpenetrated markets.

The partnership with Recordati initiated an entirely new phase for the company as we've now transitioned to a fully partnered commercial model across all international markets. Our syndicate of 7 partners across the globe are rapidly pursuing the expansion of the market for VASCEPA. We've continued to efficiently generate VASCEPA revenue in the U.S., successfully defended the brand in the U.S. via competitive pricing and expect that market to remain a significant contributor of cash and profit to the company moving forward.

VASCEPA continues to garner strong support globally within the scientific community, particularly among key opinion leaders, clinicians and other influencers around the safety, efficacy and unique mechanism of action of IPE and EPA. And we're just getting started on realizing the full benefit of our newly rightsized operating footprint, including expanded operating margins and an accelerated path to positive free cash flow over the next year.

In summary, we're confident in the strategic actions we've already taken, optimistic about the potential and future of our global business and actively working to identify value-building opportunities that capitalize on and leverage all our strengths. As always, we look forward to reporting on our future progress. And with that, I'll now turn the call over to Pete to take us through a review of the numbers. Pete?

Thank you, Aaron. At the end of the third quarter of 2025, our business continues to demonstrate financial discipline with operating margin and cash flow trends positioned for steady improvement. The third quarter marked the first full quarter following the Recordati partnership agreement as we transition to a fully partnered model outside of the U.S. The results offer early indications that the strategic decisions implemented have positioned the company to enhance shareholder value, and we are optimistic about the path forward.

I will now turn to the financial results for the most recent reporting period. Total net revenue was $49.7 million, an increase of $7.4 million or 17% versus the prior year period, primarily reflecting the impact of higher U.S. sales.

Net product revenue was $48.6 million, an increase of $6.7 million or 16%. For the U.S. business, net product revenue was $40.9 million, an increase of $10.3 million or 34%, primarily driven by an increase in net selling price from a change in customer mix and an increase in volume by regaining exclusive status with a large PBM during the quarter. As of Q3 2025, we maintained a majority share of over 50% of the IPE market, further validating the resilience of our VASCEPA franchise now 5 years post generic entry, a track record we will continue to manage primarily through our commitment to competitive pricing.

For the Europe business, as Aaron mentioned earlier, the transition of our commercialization operations to Recordati is progressing and remains on track for completion by year-end. Q3 2025 was the first reporting period with the Recordati licensing agreement in full effect. Product revenue was $4.1 million, consistent with the prior year period. Current period product revenue includes $1.7 million in supply shipments to Recordati and reflects the shift in our European business model.

We are pleased by the continued end-market demand growth across all launch geographies, particularly as we navigate this transition phase with Recordati. It's important to note that by moving to a partnering model, consistent with our Rest of World business, product revenue will be variable quarter-to-quarter, reflecting the current scale of operations as well as the impact of launch timing, in-market demand and the structure of individual partnership agreements.

For the Rest of World business, product revenue was $3.6 million, a decline from the prior year, but consistent with the second quarter of 2025. Licensing and royalty revenue was $1.1 million, an increase of $0.7 million, reflecting our partners continuing to drive in-market demand. We are encouraged by the potential of these international markets and remain committed to collaborating closely with our partners to unlock the full potential and reach of these evolving markets, while we continue to efficiently compete on volume and price in the U.S. We look forward to sharing continued progress in the quarters ahead.

Turning to expenses. During Q3 2025, we began to realize the savings as part of our global restructuring that was announced in conjunction with the Recordati partnership. Specifically, SG&A was $19.7 million, a reduction of $17.2 million or 47% over the prior year period. This begins to give an indication of our rightsized operating footprint. R&D expense was $4.2 million, in line with our ongoing commitment to global regulatory support and the science underlying our global branded product franchise.

We expect these cost savings to continue to flow through the income statement in future quarters. Restructuring expense was $9.4 million, bringing our total cost to date to $32.2 million, of which $17.2 million has been paid as of September 30, 2025. We expect these costs to trend lower going forward as we complete the operational transition. As a result, operating loss was $11.1 million, which is $14.1 million or 56% lower than Q3 2024, a clear indication of a path to more efficient and cost-appropriate operations. In addition, Q3 2025 operating margin was negative 22%, a substantial improvement from the negative 60% margin in the prior year period.

Now turning to the balance sheet. We ended the quarter with $286.6 million in cash and investments, no debt and working capital of $446 million, supporting our confidence in the current stability of our capital structure as we move forward with our new business model in Europe. We remain focused on prudent cash deployment to support growth opportunities and drive shareholder value.

To wrap up, our Q3 2025 results reflect the combination of elements, the first full quarter under the terms of the Recordati agreement, a new norm in terms of ongoing OpEx levels and the continued resilience of our U.S. business. These factors, along with growing in-market momentum across our international markets have positioned the company on solid financial footing, both now and for the future. We remain sufficiently capitalized to finance our operations while we continue to take steps to progress on an accelerated path to positive free cash flow, which we anticipate achieving in 2026.

I'll now turn it over to the operator to begin the question-and-answer session. Operator?

[Operator Instructions] Your first question for today is from Jessica Fye with JPMorgan.

Two from us, or maybe 3. First, how should we think about the U.S. net price trajectory for the back half of '25 and ideally into '26, if you can comment there?

Second, any framework for how we should think about future milestone payments from Recordati? Can you talk about what could trigger those payments? And then lastly, thinking about gross margin over time, I'm curious how you would advise us to think about the trajectory over the next few years in light of what seems like it could be a mix shift within product sales from U.S. sales towards a higher proportion of like supply sales to partners, if that makes sense.

Sure. Thanks, Jess. Thanks for joining us. Thanks for the questions. I'll address the milestone question first, then I'll turn it over to Pete Fishman to talk about the net price trajectory as well as gross margin over time. As far as the milestones, the structure of the deal is based on sales performance. So as we -- they start off at $100 million in sales and as it goes up from there as Recordati surpasses that, then that's where we trigger the milestone payments.

So they're focused on VASCEPA as a priority. They are moving very, very quickly. It will take some time for the growth, but we're confident. It's a long-term partnership. So we have confidence in their ability to drive sales and hopefully achieve those milestones.

Pete, do you want to touch on the net price as well as the gross margin?

Sure. Thanks, Aaron. On the U.S. side for the net price, as we look to the remainder of 2025, we do anticipate that it will be relatively consistent from what you've seen over the last few quarters of this year. As we look into 2026, we're still in early negotiations or conversations with the payers on our -- for our exclusives to determine what our rebate percentages will be. But if you look historically, you have seen a bit of a decline in the beginning of the year going into the next year based off of those contracts and agreements with our exclusives.

In terms of the gross margin percentage, you're right. As we move to more of a partnered model, you're going to see a decline in the gross margin percentages going forward. That said, with a decline in our operating expenses moving forward, too, based off of this model, when we look at operating margin moving forward, we will start to see the benefit from these partnership agreements and lower operating expense.

Your next question is from Mazi Alimohamed with Leerink.

It's Mazi on for Roanna Ruiz. Just 2 from us. I guess, first, so Europe sales dipped slightly this quarter because of the transition to Recordati, makes sense. But could you outline the cadence of expected royalties or milestones from Recordati going forward and whether the -- I guess you just answered that. So really -- so most -- on this question, with the 4Q '25, does that mark like the trough of European contribution as the transition normalizes?

And then a second question for me is, with the recent fenofibrate update, like how do we think about the split or kind of the use of fenofibrate in the U.S. versus rest of world? And how do you think about this update kind of impacting rest of world practices where there may be more fenofibrate use? Could this be like an added tailwind in those markets?

Sure. Thanks, Mazi. Thanks for joining us, and thanks for the questions. As far as the trough, can you just clarify the European question? When you say Q4 and the trough, what -- can you provide a little bit more clarity on that so we answer it the right way?

Sure. I guess I was getting at like do we think that in terms of the transition period and then some of the costs or the added kind of added expenses that would come with the transition period, do we expect that kind of that's now going to be at the end of the year? And then starting '26 and onwards, we expect that all the kind of issues or costs that were associated with that would be over and now we would just be moving forward is kind of what I meant with that first part, if that makes sense.

Yes. Okay. So Pete, do you want to talk about the restructuring costs we had in Q3 and then into Q4?

Yes. Sure. So as you've seen over the last couple of quarters, we have had the restructuring costs. It has trended downwards. We do anticipate additional charges within Q4 at a lower level and then moving into next year, seeing those restructuring charges and continuing to see that benefit on operating side of the expense side.

As a reminder, what we talked about in our initial release, our restructuring charges in the range of $30 million to $37 million, and we are within that range and expect by the end of the year to remain within that range. And as we also look forward, the transition completing, you'll start to see that normalization of revenue more in line with our typical partnership model of rest of world with that variability on the supply side, but continued royalty stream as well.

Regarding the question on fenofibrate, first, I'll talk about the U.S. and why it matters and then how that works or what our perspective is versus ex U.S. So the issue in the U.S. is fibrates are used extensively in combination with statins for reducing cardiovascular risk reduction and have been used as such for decades. There are more prescriptions written for fibrates in combination with statins than total IPE, that's VASCEPA plus generics combined. Yet the data continues to show that there is not a reduction in -- there's not a reduction in cardiovascular events when you add fibrates to statins. Yet there is an increase in the risks and certainly on the safety side, as noted in the label.

FDA has reacted to that. And science continually evolves. It's good to see FDA step up and acknowledge that because there are a lot of patients at risk when it comes to that. So how that will work out for the U.S. and whether or not that drives the IPE category depends on whether or not there is change by providers and change by payers. They are cheap drugs, and there's a lot of apathy around it. It's a habit that's been instilled, but the science has evolved. And hopefully, all of those stakeholders will respond to how the science has evolved and they can do better for patients and patients need to have better therapies. And frankly, one of those therapies is VASCEPA because we have the cardiovascular outcomes and the FDA indication as such.

In terms of the rest of the world, there's -- Europe and rest of the world, there's extensive fibrate use everywhere. There are some countries where it's more than others. They're used primarily to -- with the hope that they prevent cardiovascular events. Even though they're triglyceride-lowering drugs, which is why they're a direct competitor to IPE, to VASCEPA, VAZKEPA in Europe, bottom line is they're used in a way that really should change given that the science has evolved.

And the hope is that while the label change from FDA is U.S.-centric, that the science has recognized the rationale for changing that is not a U.S. issue, that's a global issue. The fibrates don't work to reduce cardiovascular events anywhere. And hopefully, that's something that will make a difference in the business.

If there's change, then -- and those patients that have elevated triglycerides that are on statins have controlled LDLs or fit the REDUCE-IT criteria, fit our label, fit our reimbursement in these countries, then the option should be VASCEPA. And hopefully, the providers and the payers where reimbursement is and for that matter, where we have regulatory activity going on for future approvals, hopefully, they all respond to that, and we see the benefit for years to come.

Your next question for today is from Paul Choi with Goldman Sachs.

This is Daniel on for Paul. So we're curious about like why is the rest of the world revenue declining by half compared to 3Q 2024? If you could provide some colors on that.

Pete, do you want to comment on that?

Sure. So as we've talked about in the past, the rest of world revenue in this partnership model is based off of supply shipments to our partners. There is going to be variability within that based off of the end market demand, the timing of the launches and other factors.

And leading into last year, there was additional supply purchases as a result of launch in end market with our different partners. We've seen kind of more of a steady state where there hasn't been any of those larger launches in this quarter, and we expect that variability to continue as we look forward in each of these markets.

We have reached the end of the question-and-answer session, and I will now turn the call over to Aaron Berg for closing remarks.

Thank you. Thank you to everyone for joining us today. Thank you for the questions, and enjoy the rest of your day.

This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.