Indivior PLC (LON: INDV) have reported a third quarter profit fall, after their third quarter trading update was released Thursday morning.
Revenue was hurt by the launch of a generic competitor to its opioid addiction treatment drug Suboxone Film.
British based Reckitt Benckiser Group Plc (LON: RB) have seen similar struggles to Indvior after they cut their full year forecast earlier this month.
The firm reported that net revenue had dropped 19% to $199 million from $245 million.
Additionally, the company posted a $56 million pretax profit for the three months ended September 30, 18% lower than the $68 million profit posted the year before.
Selling, General & Administrative expenses fell 21%, while research & development expenses fell 31% to $11 million from $16 million.
For the nine months ending September 30th, pretax profit fell 14% to $222 million, versus $257 million.
Net revenue was down 15% at $652 million from $768 million, which creates worries for investors and shareholders.
The US based firm have their operating headquarters in Virginia, and 2019 has represented a tough period for the medical supplier outside of trading figures.
The Federal Grand Jury in Virginia, charged Indivior for the for a number of charges including “” health care fraud, wire fraud, mail fraud, and conspiracy”.
The charges related to Indivior’s marketing, promotion, and safety claims around its addiction drug Suboxone – as well as overprescription of the drug by doctors.
At present, the US Department of Justice intends to recover $3 billion worth of forfeitures from Indivior.
“The company believes it has strong defences to the government’s charges and will vigorously defend itself. It is not possible to predict with any certainty the potential impact of this litigation on the group or to quantify the ultimate cost of a verdict or resolution,” said Indivior.
Net income is predicted to be $160 million to $190 million, a huge increase compared to the $80 million to $130 million prior forecast.
Chief Executive Shaun Thaxter said: “Indivior has delivered solid results ahead of plan this year and this momentum has continued through the third quarter. Despite the pressure from buprenorphine/naloxone film generics, Suboxone Film share remained above observed analogues and exceeded our plans.
Thaxter added “”This, combined with Sublocade net revenue growth, initial contribution from Perseris and our ongoing expense discipline, has allowed us to raise our 2019 financial guidance and to further build our cash position to over USD1 billion. More positively, our year-to-date performance has put Indivior in a position to reinvest some of the upside to further support the future growth of Sublocadeand Perseris.”
He concluded “We remain acutely aware of the challenges in the marketplace and the legal uncertainties. We are proactively managing these risks, where possible, as evidenced by our decision to discontinue production of the authorized generic buprenorphine/naloxone film. This followed the recent passage of legislation that, while we believe unintended, would have resulted in the unsustainable position of Indivior selling Suboxone Film at a negative gross profit through most US government channels.”
Shares of Indivior are trading at 42p per share, crashing 7.3%. 31/10/19 12:43BST