Indivior swings to loss despite strong Sublocade performance

Indivior reported a solid third-quarter financial performance on Thursday, as Sublocade net revenue jumped 55% year-on-year to $167m, although a significant cash outflow saw it swing to a loss.

The FTSE 250 company adjusted its full-year expectations for Sublocade from $610m to $630m from the previous projection of $590m to $630m.

Indivior also successfully launched Opvee and secured a contract with the US Biomedical Advanced Research and Development Authority (BARDA).

In terms of overall financial performance, Indivior achieved a total net revenue of $800m for the year-to-date, up 21% year-on-year.

Third quarter total net revenue reached $271m, up 17%.

However, the company reported a year-to-date operating loss of $65m, swinging from a profit of $173m at the same time last year, with the third quarter seeing an operating loss of $183m compared to a profit of $56m a year ago.

On an adjusted basis, year-to-date operating profit was up 17% at $202m, while third-quarter adjusted operating profit rose 3% to $60m.

Despite the financial fluctuations, the firm noted that its year-to-date net income increased to $162m on an adjusted basis, marking a 25% rise year-on-year.

For the third quarter, Indivior recorded a net income of $49m on an adjusted basis, representing a 14% increase compared to the third quarter of 2022.

Indivior’s cash and investments stood at $774m at the end of the period, down from $991m a year earlier.

The board said the decline primarily resulted from a net cash outflow of $124m related to the Opiant acquisition and litigation settlement outflows totalling $207m for the year so far.

Sublocade continued to perform strongly on the product front, with year-to-date net revenue up 57% at $454m, thanks to increased penetration in the organised health system channel in the US and a rise in new US patient enrollments.

Third quarter dispenses of Sublocade in the US reached around 133,600 units, making for a 59% increase compared to the same period in 2022.

Perseris, or risperidone extended release, also demonstrated positive results, with year-to-date net revenue of $30m, up 50% on the year.

In the third quarter, Perseris achieved net revenue of $11m, representing a 38% year-on-year increase.

Meanwhile, suboxone film maintained a US market share of 18% during the third quarter, consistent with the same period in 2022.

Indivior announced the resolution of antitrust multidistrict litigation on 22 October, agreeing to pay $385m to direct purchasers, which is expected to be funded from existing cash in November.

Looking ahead, Indivior said it expected net revenue in the range of $1.03bn to $1.09bn for the year, reflecting 18% growth at the midpoint compared to 2022.

The company raised its expectations for Sublocade net revenue, while Perseris net revenue was expected to be at the lower end of the $45m to $55m range.

Adjusted sales, general and administrative expenses were expected to be in the range of $540m to $550m, slightly higher than previous guidance due to targeted investments in Sublocade’s growth and increased legal defence expenses.

Overall, the group anticipated higher adjusted operating profit in 2023, assuming no material change in exchange rates for key currencies.

“This quarter has again demonstrated the commitment and capabilities of the Indivior team,” said chief executive officer Mark Crossley.

“We delivered double-digit top-line performance led by strong growth of Sublocade, which continues to shift the paradigm for the treatment of opioid use disorder (OUD).

“Additionally, we made good progress against our strategic priorities, with the launch of Opvee nasal spray as well as key transactions to strengthen our pipeline and to secure long-term product supply.

“Lastly, we settled the antitrust multidistrict litigation, which provides more certainty for our stakeholders and allows for even greater focus on serving the needs of patients with substance use disorders and mental illness.”

At 0841 GMT, shares in Indivior were down 3.4% at 1,502p.

Reporting by Josh White for Sharecast.com.