Indivior Provides Business Update; Conference Call at 8:00 AM U.S. EDT
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATION (EU) 596/2014 (AS IT FORMS PART OF DOMESTIC LAW IN THE
- Updating Q2 net revenue (NR) expectations and FY 2024 guidance to reflect continued adverse market dynamics impacting near-term SUBLOCADE NR growth as well as the initial commercial adoption of OPVEE; At the mid-point, the Group continues to expect strong YOY NR growth for SUBLOCADE of 25% and YOY adjusted operating income growth of 12% in FY 2024;
- Reiterating its medium-term financial outlook for double-digit NR growth and operating margin expansion, based on its confidence in achieving its intermediate and peak NR goals for SUBLOCADE as well as peak NR expectations for OPVEE;
- Discontinuing sales and marketing for PERSERIS due to expected adverse impacts from increased payor management of the category that crystalized in Q2 and that are expected to make the product no longer financially viable; and,
- Reaching a settlement agreement with end payor plaintiffs in the
Health Care Services Corp (HCSC) consolidated cases to resolve the litigation for$85m .
Comment by
"Despite positive early performance trends at the start of the second quarter, SUBLOCADE net revenue (NR) has continued to be impacted more than we expected by a combination of transitory factors, primarily the elimination of COVID emergency measures related to automatic Medicaid coverage renewals. Furthermore, as we look to the second half of the year, the
Looking beyond these transitory impacts, we remain firm in our conviction that SUBLOCADE's unique profile to address high-powered synthetic opioids, such as fentanyl, provides us with a tremendous opportunity to meet the growing and changing needs of patients. As a result, we continue to be confident that SUBLOCADE will achieve a net revenue run rate of
Separately, we are taking decisive action that we believe is in the best interest of shareholders in two areas. First, we are creating greater certainty for all stakeholders by settling with Plaintiffs ahead of our antitrust trial on
Discontinuation of PERSERIS Sales & Marketing:
The Group will immediately cease all sales and marketing activities related to PERSERIS. The Group believes this action is in the best interests of shareholders due to the highly competitive market and impending changes that are expected to intensify payor management in the treatment category in which PERSERIS participates. Analysis of forthcoming changes suggests that there is no longer a path forward for PERSERIS that is financially viable.
Total expected charges related to this action are expected to be approximately
Preliminary Q2 Net Revenue Expectations:
The Group is providing the below preliminary expectations for key NR drivers for Q2 2024.
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Net Revenue (NR) |
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SUBLOCADE NR |
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PERSERIS NR |
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Continued transitory patient treatment disruptions from ongoing Medicaid disenrollments that accelerated at the end of the quarter have disproportionately impacted SUBLOCADE. Combined with lower-than-expected stocking levels in key channels and longer-than-expected activation times with new criminal justice system accounts, SUBLOCADE NR was lower than expected in the second quarter.
- Ongoing Medicaid disenrollments in the second quarter continued to impact new patient starts and refills. At the end of the second quarter, Medicaid disenrollments stood at approximately 23 million1 versus approximately 19 million1 at the end of the first quarter. The continued decline in Medicaid patient levels in the second quarter combined with fewer patients returning to treatment from first quarter Medicaid disenrollments and the
Change Healthcare cyber-attack disruption had a greater than expected impact on NR performance in the second quarter. As a result, despite early positive performance trends in the quarter, overall new SUBLOCADE patient growth and refills were below expectations. In addition, Medicaid renewal actions in some instances are being permitted byCenters for Medicare & Medicaid Services (CMS) to extend into the third quarter, likely prolonging the period of SUBLOCADE patient disruption.
- Stocking in the second quarter was also lower than expected, as days of SUBLOCADE inventory on-hand remained relatively unchanged at first quarter levels of under two weeks, which is historically low. The Group now believes its specialty pharmacy and specialty distributors have made permanent one-off inventory adjustments to take advantage of shortened lead times associated with supply efficiencies to organized health and criminal justice system customers.
- While SUBLOCADE NR from the criminal justice system continued to grow strongly in the second quarter, increasing approximately 85% compared to the year-ago quarter, longer lead times to open new criminal justice system accounts also impacted expectations for NR in the second quarter. The Group remains confident this timing issue does not undermine the potential for SUBLOCADE to address the large unmet need in this important and growing new channel.
- Impact of competitor activity was in line with expectations.
OPVEE NR in the second quarter was immaterial (<
Updated FY 2024 Guidance1:
Considering the above factors and the cessation of PERSERIS sales and marketing, the Group is updating FY 2024 guidance as set out below. The Group continues to expect solid adjusted operating income growth and adjusted operating margin expansion at the midpoint of approximately 100 basis points versus FY 2023. Beyond 2024, the Group will no longer separately report PERSERIS NR.
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Updated ( |
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Net Revenue (NR) |
(+8% at mid-point vs. FY 2023) |
|
SUBLOCADE NR |
(+25% at mid-point vs. FY 2023) |
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OPVEE NR |
Predominantly expected to come from |
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PERSERIS NR |
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SUBOXONE Film Market Share3 |
No change |
Assumes historic rate of share decline of 1 to |
Adjusted Gross Margin |
No change |
Low to mid 80% range |
Adjusted SG&A |
(
Reflecting discontinuation of the sales and |
( |
R&D |
No change |
( |
Adjusted Operating Profit |
(approx. 100 bps of margin expansion vs. FY 2023) |
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|
|
1 |
Guidance assumes no material change in exchange rates for key currencies compared with FY 2023 average rates, notably USD/GBP and USD/EUR |
2 |
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3 |
Reflecting underlying share erosion at a similar rate to the last two years (approximately 2 share points p.a.) |
|
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Long-term Net Revenue Targets Remain Unchanged:
The Group remains confident that given the scale of the
Settlement with Certain End Payors:
On
As part of the agreement with the plaintiffs,
Conference Call Information:
Participants may access the event telephonically to ask a question by registering with the following link:
https://register.vevent.com/register/BI07a0798620a745bca417b4b9d15d9fe2
(Registrants will have an option to be called back directly immediately prior to the call or be provided a call-in # with a unique pin code following their registration)
The webcast link is: https://edge.media-server.com/mmc/p/nga7b6nn
Important Cautionary Note Regarding Forward-looking Statements
This press release contains certain statements that are forward-looking. Forward-looking statements include, among other things, statements regarding financial guidance for 2024, including sales expectations for SUBLOCADE, PERSERIS, and OPVEE, expected growth in adjusted operating income and expected margin expansion; expected medium term margin expansion and cash flow generation; peak net revenue goals for SUBLOCADE and OPVEE, and a
Actual results may differ materially from those expressed or implied in these forward-looking statements due to a number of factors, including: lower than expected future sales of our other products; increased impacts from competition; failure to achieve market acceptance of OPVEE; the possibility that the Court will not approve the settlement, the possibility that the Court will require changes to the settlement prior to approving it, potential delays in obtaining Court approval of the settlement; and those factors described in
We have based the forward-looking statements in this press release on our current expectations and beliefs concerning future events. Forward-looking statements contained in this press release apply only at the date of this press release, and we undertake no obligation publicly to update or revise any forward-looking statement, whether due to new information, future developments or otherwise.
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