Indivior Provides Preliminary Q3 2024 Results; Updates FY 2024 Guidance; Group Continues to Expect SUBLOCADE Peak Net Revenue of >$1.5 Billion

Rhea-AI Summary

Indivior PLC (Nasdaq/LSE: INDV) announced preliminary Q3 2024 financial results and updated FY 2024 guidance. Key points:

• Q3 2024 SUBLOCADE net revenue (NR): $187m to $192m
• Revised FY 2024 SUBLOCADE NR: $725m to $745m (+17% vs. FY 2023)
• Expected peak SUBLOCADE NR of >$1.5 billion unchanged
• No longer expects $1 billion SUBLOCADE NR run rate exiting 2025

Factors impacting performance:

• Faster adoption of competing long-acting injectable
• Variability in Criminal Justice System funding timing
• Lower trade stocking

The company remains confident in SUBLOCADE's differentiated profile for opioid use disorder patients and is evaluating actions to fuel growth and support margins.

Positive

• Expected peak SUBLOCADE net revenue of >$1.5 billion remains unchanged
• Q3 2024 total net revenue expected to grow 13% year-over-year
• SUBLOCADE Q3 2024 net revenue expected to grow 14% year-over-year
• New Criminal Justice System activations continued to grow in Q3
• Potential SUBLOCADE label updates in February 2025 expected to improve patient and healthcare provider experience

Negative

• Reduced FY 2024 SUBLOCADE net revenue guidance from $765m-$805m to $725m-$745m
• No longer expects SUBLOCADE to exit 2025 at a $1 billion net revenue run rate
• Faster than expected initial adoption of competing long-acting injectable product
• Criminal Justice System net revenue expected to decline versus previous quarter
• Lower than expected trade stocking levels in Q3 2024

Insights

Financial Analyst

Indivior's Q3 2024 preliminary results and updated FY 2024 guidance reveal significant challenges for their key product SUBLOCADE. The company is facing faster-than-expected adoption of a competing long-acting injectable, variability in Criminal Justice System funding and lower trade stocking. This has led to a substantial downward revision in SUBLOCADE net revenue guidance for FY 2024, now expected at $725m to $745m, down from the previous $765m to $805m.

The company no longer expects to reach a $1 billion net revenue run rate for SUBLOCADE by the end of 2025, which is a significant setback. However, they maintain their long-term peak revenue expectation of >$1.5 billion for SUBLOCADE, suggesting confidence in the product's future despite near-term headwinds.

Indivior is actively seeking efficiencies to support growth and margins, which will be important in navigating the competitive landscape. The upcoming label updates for SUBLOCADE in February 2025, if approved, could provide a competitive advantage. Investors should closely monitor market share trends and the company's ability to execute its growth strategies in the face of increased competition.

Market Research Analyst

The opioid use disorder (OUD) treatment market is evolving rapidly with the introduction of a competing long-acting injectable. Indivior's SUBLOCADE is facing unexpected pressure, particularly in the Criminal Justice System segment, which was previously a strong growth driver. This shift indicates a dynamic market where healthcare providers and institutions are willing to trial new treatment options.

Despite the near-term challenges, there are positive signs for the broader LAI market. The faster adoption of the competing product suggests growing acceptance of LAI treatments for OUD, which could expand the overall market size. Indivior's claim that SUBLOCADE's market share is stabilizing in early competitive cohorts is important and warrants close observation.

The company's focus on potential label updates and its belief in SUBLOCADE's differentiated profile, especially in addressing challenges posed by synthetic opioids, could be key factors in maintaining its market position. However, the competitive landscape has clearly intensified and Indivior's ability to articulate and deliver on SUBLOCADE's unique value proposition will be critical for its long-term success in this evolving market.

Conference Call Today at 8:00 AM US Eastern

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 UK BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018).

RICHMOND, Va., Oct. 10, 2024 /PRNewswire/ -- Indivior PLC (Nasdaq/LSE: INDV) today announced preliminary Q3 2024 financial results and provided updated FY 2024 guidance.

• Group now sees lower than expected Q3 2024 and FY 2024 SUBLOCADE net revenue (NR) from a combination of faster initial adoption among treatment providers of the competing long-acting injectable (LAI), variability in the timing of funding among certain Criminal Justice System (CJS) accounts and incremental lower trade stocking.
  • Preliminary Q3 2024 SUBLOCADE NR: $187m to $192m
  • Revised FY 2024 SUBLOCADE NR: $725m to $745m (+17% at the midpoint vs. FY 2023)
• Expected peak SUBLOCADE NR of >$1.5 billion is unchanged, however the Group no longer expects a SUBLOCADE NR run rate of $1 billion exiting 2025.
• The Group is actively seeking efficiencies to fuel SUBLOCADE growth and support margins.

Comment by Mark Crossley, CEO of Indivior PLC

"We are seeing faster than expected initial adoption of the competitive product to SUBLOCADE. This dynamic, together with greater variability in the timing of funding among Criminal Justice System customers, as well as incremental trade stocking pressure, has resulted in net revenue below our expectations set out in July. We are reducing our FY 2024 guidance to reflect these impacts. In addition, looking to the year ahead, as the US market adjusts to two LAI products, pressure on SUBLOCADE volume growth is expected from continued initial competitor adoption. Therefore, we no longer expect that SUBLOCADE will exit 2025 at a $1 billion net revenue run rate.

We remain firm in our conviction that SUBLOCADE has a differentiated and optimal profile for opioid use disorder (OUD) patients, including our belief that it will best meet the increasing challenges that synthetic opioids are presenting to OUD patients and treatment providers. Additionally, we expect SUBLOCADE's profile to be further enhanced with important label updates in February 2025 that, if approved by the FDA, are expected to improve both the patient and healthcare provider experience. We also are actively evaluating actions to fuel SUBLOCADE's growth and to support margins.

Further, we have been tracking multiple market cohorts since the competitor's launch a year ago and, while we have seen faster than expected initial adoption, recent market data is consistently showing that SUBLOCADE's share is stabilizing at levels demonstrating its leading position in the clinic. Coupled with the continued expected growth of the wider LAI market, we believe this evidence validates the significant market opportunity we see for SUBLOCADE and we believe it confirms our unchanged peak annual SUBLOCADE NR expectation of greater than $1.5 billion."

Preliminary Q3 Net Revenue Expectations:

The Group is providing the below preliminary expectations for key NR drivers for Q3 2024.

	October 10, 2024
Net Revenue (NR)	$302m to $309m  (+13% vs. Q3 2023 at the mid-point)
SUBLOCADE NR	$187m to $192m  (+14% vs. Q3 2023 at the mid-point)
OPVEE	~$15m

• Competition: Initial adoption among treatment providers for the competing LAI has been faster than expected. In particular, the Group has seen accelerated trial among Criminal Justice System (CJS) accounts. While this dynamic is adversely impacting SUBLOCADE NR in the near-term, the Group is seeing SUBLOCADE's market share stabilizing in multiple early competitive cohorts at levels in line with the Group's expectations of maintaining its leading position in the clinic.
  
  
• CJS: New CJS activations continued to grow in the third quarter. However, CJS NR is expected to decline versus the previous quarter due to greater variability in funding timing across certain CJS accounts in the near-term as well as from continued competitive pressure. The Group continues to see significant growth in interest and intention to treat with SUBLOCADE among its CJS accounts and therefore expects strong contribution to SUBLOCADE growth from this channel.
  
  
• Stocking: Stocking levels were lower than expected in the third quarter, as days of SUBLOCADE inventory on-hand were further reduced from the historically low levels seen in the first half of 2024. The Group believes its specialty pharmacy and specialty distributors have made permanent inventory adjustments to take advantage of shortened lead times associated with supply chain efficiencies to organized health system and CJS customers and have adjusted accordingly.
  
  
• OPVEE: OPVEE NR in the third quarter is estimated to be approximately $15 million driven by an additional product order from Biomedical Advanced Research and Development Authority (BARDA) for approximately $8 million in late September.

Updated FY 2024 Guidance¹:

	Updated October 10, 2024	July 25, 2024
Net Revenue (NR)	$1,125m to $1,165m (+5% at mid-point vs. FY 2023)	$1,150m to $1,215m (+8% at mid-point vs. FY 2023)
SUBLOCADE NR	$725m to $745m (+17% at mid-point vs. FY 2023)	$765m to $805m (+25% at mid-point vs. FY 2023)
OPVEE NR	Approx. $15m Predominantly from two optioned product deliveries as part of the 10-year BARDA2 contract	$9m to $14m Predominantly expected to come from fulfilling first delivery as part of 10-year BARDA2 contract (~$8m)
PERSERIS NR	$32m to $37m	$27m to $33m
SUBOXONE Film Market Share3	No change	Assumes historic rate of share decline of 1 to 2 percentage points and the potential impact from a fourth buprenorphine/naloxone sublingual film generic in the U.S. market
Adjusted Gross Margin	No change	Low to mid 80% range
Adjusted SG&A	($555m) to ($560m)	($550m) to ($560m) Reflecting discontinuation of the sales and marketing of PERSERIS
R&D	($115m) to ($120m)	($120m) to ($130m)
Adjusted Operating Profit	$260m to $280m (mid-point flat vs. FY 2023)	$285m to $320m (approx. 100 bps of margin expansion vs. FY 2023)

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 Biomedical Advanced Research and Development Authority

3 Reflecting underlying share erosion at a similar rate to the last two years (approximately 2 share points p.a.)

Conference Call Information:

Indivior will host a presentation via live webcast at 1:00 p.m. London time (8:00 a.m. U.S. Eastern) today. The webcast event can be accessed on the "Investors" section of the Group's website at www.indivior.com before the event begins.

Participants may access the event telephonically to ask a question by registering with the following link: https://register.vevent.com/register/BI1645f2be3a89406283143f50502ce9b8
(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/n9euz3cz

Important Cautionary Note Regarding Forward-looking Statements 

This press release contains certain statements that are forward-looking. Forward-looking statements include, among other things, express and implied statements regarding: financial guidance for Q3 and full year 2024, including sales expectations for SUBLOCADE, PERSERIS, and OPVEE, and other financial metrics such as market share, adjusted gross margin, adjusted SG&A, research and development expenses, and adjusted operating profit; peak net revenue goals for SUBLOCADE; our present intention to take actions to fund and accelerate SUBLOCADE Net Revenue growth, including resource reallocation and investment prioritization for additional SUBLOCADE growth initiatives, and whether those will be successful; expectations for SUBLOCADE growth in the near, medium, and long-term, including that it will hit a peak net revenue goal of >1.5 billion; and other statements containing the words "believe," "anticipate," "plan," "expect," "expectation," "intend," "estimate," "forecast," "strategy," "target," "guidance," "outlook," "potential," "project," "priority," "may," "will," "should," "would," "could," "can," "outlook," "guidance," the negatives thereof, and variations thereon and similar expressions. By their nature, such forward-looking statements involve risks and uncertainties as they relate to events or circumstances that may or may not occur in the future. 

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 products; increased impacts from competition; failure to achieve market acceptance of OPVEE; unanticipated costs; whether we are able to identify and fund additional investments that we expect to generate increased revenues, and the timing of such actions; and our belief that SUBLOCADE will meet the challenges that synthetic opioids present to patients and treatment providers. For information about some of the risks and important factors that could affect our future results and financial condition, see "Risk Factors" in Indivior's Annual Report on Form 20-F for the fiscal year 2023 and its other filings with the U.S. Securities and Exchange Commission. 

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 except as required by law we undertake no obligation publicly to update or revise any forward-looking statement, whether due to new information, future developments or otherwise. 

About Indivior
Indivior is a global pharmaceutical company working to help change patients' lives by developing medicines to treat substance use disorders (SUD), overdose and serious mental illnesses. Our vision is that all patients around the world will have access to evidence-based treatment for the chronic conditions and co-occurring disorders of SUD. Indivior is dedicated to transforming SUD from a global human crisis to a recognized and treated chronic disease. Building on its global portfolio of OUD treatments, Indivior has a pipeline of product candidates designed to both expand on its heritage in this category and potentially address other chronic conditions and co-occurring disorders of SUD, including alcohol use disorder and cannabis use disorder. Headquartered in the United States in Richmond, VA, Indivior employs over 1,000 individuals globally and its portfolio of products is available in over 30 countries worldwide. Visit www.indivior.com to learn more. Connect with Indivior on LinkedIn by visiting www.linkedin.com/company/indivior. 

This release is being made by Kathryn Hudson, Company Secretary Indivior PLC.

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SOURCE Indivior PLC

FAQ

What is Indivior's revised FY 2024 SUBLOCADE net revenue guidance?

Indivior has revised its FY 2024 SUBLOCADE net revenue guidance to $725m to $745m, representing a 17% growth at the midpoint compared to FY 2023.

Why did Indivior (INDV) reduce its SUBLOCADE revenue guidance for 2024?

Indivior reduced its SUBLOCADE revenue guidance due to faster adoption of a competing long-acting injectable product, variability in Criminal Justice System funding timing, and lower trade stocking levels.

What is Indivior's (INDV) expected peak annual net revenue for SUBLOCADE?

Indivior maintains its expectation of peak annual SUBLOCADE net revenue of greater than $1.5 billion, despite the recent guidance reduction.

How much net revenue does Indivior (INDV) expect from SUBLOCADE in Q3 2024?

Indivior expects SUBLOCADE net revenue for Q3 2024 to be between $187 million and $192 million, representing a 14% year-over-year growth at the midpoint.

What factors are impacting Indivior's (INDV) SUBLOCADE performance in 2024?

Factors impacting SUBLOCADE performance include faster adoption of a competing product, variability in Criminal Justice System funding timing, and lower trade stocking levels.