Release Date: October 24, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Indivior PLC (INDV, Financial) reported a 13% year-over-year increase in total net revenue for the third quarter, reaching $307 million.
- The company's adjusted operating profit increased by 62% to $97 million, indicating strong underlying profitability.
- Sublocade's market share of new patients was 72% at the end of the third quarter, maintaining its leadership position.
- Indivior PLC (INDV) is actively pursuing cost reduction strategies, including streamlining G&A expenses and reprioritizing its R&D pipeline.
- The company reached a preliminary agreement to settle the last remaining legacy antitrust cases for $40 million, which could resolve ongoing litigation issues.
Negative Points
- Despite a 2% increase in Sublocade dispenses quarter-over-quarter, there was a modest decline in net revenue due to trade destocking.
- The competitive landscape is impacting Sublocade's growth, with intensified competition leading to the loss of significant accounts.
- Indivior PLC (INDV) had to discontinue the development of certain pipeline assets, including a phase 2B study for cannabis use disorder that did not meet its endpoints.
- The company's adjusted gross margin decreased due to cost inflation and unfavorable pricing on specific production batches.
- Indivior PLC (INDV) revised its full-year 2024 guidance, reflecting headwinds from competition and funding fluctuations, with a midpoint growth of only 5% year-over-year.
Q & A Highlights
Q: Can you discuss your expectations for market share of new starts in the competitive landscape and your approach to capital deployment, including share buybacks and business development?
A: Mark Crossley, CEO, explained that Indivior remains confident in maintaining a strong market share, with new patient share above 70% and stabilization in the mid-60% range. The company sees significant unmet needs in the market, with room for two players. Regarding capital deployment, Indivior will continue to prioritize advancing assets and maintaining financial flexibility. Share buybacks are ongoing, and business development is not a short-term focus.
Q: What is the strategy to drive awareness of label updates for Sublocade among clinicians and patients?
A: Mark Crossley, CEO, stated that the company plans to utilize awareness, trial, and adoption efforts to promote the label updates for Sublocade. These efforts will focus on both healthcare professionals and patients, with investments beginning upon expected approval in February 2025.
Q: Can you provide more details on the cohort data and how it reflects the competitive landscape?
A: Mark Crossley, CEO, noted that the cohort data involves about 500 physicians and shows stabilization in the mid-60% share range for Sublocade. This data reinforces the importance of efficacy in treatment decisions and indicates that Sublocade maintains a leadership position in the market.
Q: How do you view the pricing environment for Sublocade, and are there any expected price headwinds?
A: Mark Crossley, CEO, clarified that the overall market pricing is stable, with open access across commercial and government payers. However, in certain criminal justice system accounts, pricing is more sensitive, and competition has used pricing to gain access. Indivior believes that efficacy will ultimately drive preference for Sublocade.
Q: Can you explain the visibility over Q4 Sublocade performance and the factors influencing the guidance range?
A: Mark Crossley, CEO, explained that the guidance range accounts for continued competitive adoption, funding fluctuations in the criminal justice system, and de-stocking. The intensity of these factors determines the range from the top to the bottom end of the guidance.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
