31st Oct 2019 11:56
(Alliance News) - Pharmaceuticals company Indivior PLC on Thursday said profit fell in the third quarter of 2019, with revenue hurt by the launch of a generic competitor to its opioid addiction treatment drug Suboxone Film.
Shares in Indivior were down 5.6% at 42.63 pence in London in late morning trade.
Net revenue dropped by 19% to USD199 million from USD245 million. This meant that the company posted a USD56 million pretax profit for the three months ended September 30, 18% lower than the USD68 million profit posted the year before.
Selling, general & administrative expenses fell 21% to USD97 million from USD123 million while research & development expenses fell 31% to USD11 million from USD16 million.
For the nine months ended September 30, pretax profit was down 14% at USD222 million versus USD257 million, while net revenue was down 15% at USD652 million from USD768 million.
Indivior's headquarters is in the US state of Virginia. In April 2019, a federal grand jury in the Western District of Virginia indicted the firm on a number of charges. These were: " health care fraud, wire fraud, mail fraud, and conspiracy".
The charges related to Indivior's marketing, promotion, and safety claims around the film and tablet forms of its addiction drug Suboxone - as well as overprescription of the drug by doctors. Then, in August, a federal grand jury in the Western District of Virginia returned a superseding indictment. This superseding indictment did not add or alter the charges, though some factual allegations were changed.
At present, the US Department of Justice intends to recover USD3 billion worth of monetary forfeitures from Indivior, as well as all assets derived from the alleged offences.
"The company believes it has strong defences to the government's charges and will vigorously defend itself. It is not possible to predict with any certainty the potential impact of this litigation on the group or to quantify the ultimate cost of a verdict or resolution," said Indivior.
On October 15, Indivior upgraded its guidance after recording stronger than expected revenue in the first three quarters of 2019. As such, net revenue is now likely to be between USD750 million and USD790 million - up from a previously USD670 million to USD720 million expectation. The net revenue forecast specifically for Sublocade has been narrowed to between USD60 million and USD70 million from USD50 million to USD70 million.
The net revenue guidance includes discontinuation of Indivior's supplying a generic version of Suboxone Film to Sandoz Inc.
Net income excluding exceptional items and at constant exchange rates is predicted at USD160 million to USD190 million - versus the USD80 million to USD130 million prior forecast.
Chief Executive Shaun Thaxter said: "Indivior has delivered solid results ahead of plan this year and this momentum has continued through the third quarter. Despite the pressure from buprenorphine/naloxone film generics, Suboxone Film share remained above observed analogues and exceeded our plans.
"This, combined with Sublocade net revenue growth, initial contribution from Perseris and our ongoing expense discipline, has allowed us to raise our 2019 financial guidance and to further build our cash position to over USD1 billion. More positively, our year-to-date performance has put Indivior in a position to reinvest some of the upside to further support the future growth of Sublocadeand Perseris."
Thaxter added: "We remain acutely aware of the challenges in the marketplace and the legal uncertainties. We are proactively managing these risks, where possible, as evidenced by our decision to discontinue production of the authorized generic buprenorphine/naloxone film. This followed the recent passage of legislation that, while we believe unintended, would have resulted in the unsustainable position of Indivior selling Suboxone Film at a negative gross profit through most US government channels."
By Anna Farley; [email protected]
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