People would think a lot more highly of this card if they'd just waited to release it with George Barnaby lol. Turning 1 card into 1 health/sanity repeatably is obviously not a great value proposition, let alone for 3 resources + 1 action upfront. It quickly looks better when the first skill discarded in a turn effectively goes back into your hand AND draws a replacement, though.
And while the rate doesn't get there on its face, I think it's worth pointing out that repeatably preventing the first N damage/horror over a scenario adds up to a LOT of sustain. I don't think it's quite good enough if you don't have some insane synergy like George does, but I also don't think it's horrendous either. This game likes to nickel and dime you to death. Most encounter decks don't have haymakers waiting to hit you with chunk damage. It's all 1 damage here, 1 horror there, then you look up and suddenly the monster that's about to hit you for 2 damage and horror is lethal. Not so with a trusty necklace.
Worth 3 resources and 1 action? Almost certainly not, but make this thing Fast and cost 1-2? I'd probably test it in builds with good card draw and/or recursion. And red is the color for that...