21st Nov 2018 09:07
LONDON (Alliance News) - Indivior PLC said Wednesday it is "surprised and disappointed" by a US court's decision to vacate a preliminary injunction against Indian pharma company Dr Reddy's Laboratories Ltd, but does not expect the generic product to enter the market in 2018.
Shares in Indivior are down 10% morning trading at 99.14 pence each, the worst performer in the FTSE 250, having lost 47% on Tuesday after announcing the court decision. Year-to-date, shares in the pharmaceutical company are down 75%.
The US Court of Appeals for the Federal Circuit vacated an injunction that previously prevented Dr Reddy's from selling offering to sell, or import its generic buprenorphine/naloxone sublingual film product.
Dr Reddy's will now look to launch a generic product in the US, eating in to Indivior's market share.
If the generic product does enter the market, Indivior expects a "rapid and material loss" of market share for its Suboxone sublingual film.
The company said, based on industry analogs, its suboxone product could lose up to 80% of market share, which would have a "significant adverse impact" on the company's revenue, profitability and cash flow.
Indivior, however, said its guidance for 2018, which was confirmed November 1, remains "valid". The company is guiding for net revenue between USD990 million and USD1.02 billion with net income of between USD230 million and USD255 million.
For 2017, Indivior recorded net revenue of USD1.09 billion with net income of USD58 million.
The company's guidance is based on "no material changes" in current market conditions. Indivior said it believes Dr Reddy's generic buprenorphine/naloxone sublingual film will not enter the market in 2018.
"We are surprised and disappointed that the court has vacated the preliminary injunction," said Shaun Thaxter, chief executive officer. "We will continue to vigorously pursue our infringement cases against DRL to protect our suboxone film patent portfolio."
Thaxter said this could include filing a petition with the court of appeals for a rehearing and opposing Dr Reddy's motion to immediately lift the preliminary injunction.
The exact timing of Dr Reddy's potential US launch is "unknown", as the preliminary injunction "typically remains in effect" until the issuance of a mandate by the Court of Appeals.
The court mandate returns the case back to a District Court to "confirm actions consistent with the Federal Court of Appeal's ruling".
Dr Reddy's filed a motion requesting the Court of Appeal issue the mandate immediately or stay the preliminary injunction pending issuance of the mandate.
Indivior said it will oppose the motion and file a petition for a panel rehearing of the ruling.
Thaxter added: "While we ultimately believe in the strength of our patent portfolio, we acknowledge that the company faces challenges in the intervening period resulting from a potential material and rapid loss of market share to generic buprenorphine/naloxone sublingual film competition, including reduced earnings and cash flow."
Related Shares:
Indivior