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Indivior's legal battles weigh on US revenues

The addiction treatment specialist warns of losses in 2020
February 13, 2020

Indivior (INDV) continues to grapple with an indictment from the US Department of Justice (DoJ) over the alleged fraudulent marketing of its opioid addiction treatment, Suboxone Film, evidenced by mounting rebates in the latter part of 2019. The pharma group reported a 44 per cent slump in Q4 net revenue, with the contraction particularly acute in the US, where net revenue was down 56 per cent to $80m (£61.5m). The group swung to a $42m loss in the last three months of the year, and is guiding for revenue in the range of $525m to $585m, together with a net loss of $20-50m this year.  

IC TIP: Sell at 40p

Suboxone's market share fell to 24 per cent in 2019, compared to an average of 53 per cent in the prior year, as cheaper generic alternatives emerged. Indivior has now shifted its focus onto key growth products, injectable treatments Sublocade and Perseris, and has set a peak net revenue goal of $1bn for the former product. Sublocade, which also treats opioid addiction, generated 18 per cent of group revenue in the last quarter and management anticipates that it will account for $150-200m of revenue in 2020, where house broker Jefferies forecasts $153m. 

INDIVIOR (INDV)   
ORD PRICE:40pMARKET VALUE:£ 293m
TOUCH:39.8-40.1p12-MONTH HIGH:120pLOW: 21p
DIVIDEND YIELD:NILPE RATIO:3
NET ASSET VALUE:29¢*NET CASH:$823m**
Year to 31 DecTurnover ($bn)Pre-tax profit ($m)Earnings per share (¢)Dividend per share (¢)
20151.012853212.7
20161.0698.05nil
20171.091378nil
20181.0127838nil
20190.7918018nil
% change-22-35-53-
Ex-div:-   
Payment:-   
*Includes intangible assets of $72m, or 9.8¢ a share.**Excludes lease liabilities of $56m.