Indivior PLC (LON:INDV) shares jumped after the pharma business upgraded its expectations for the second time in three months, as its flagship anti-opioid addiction drug Suboxone stays ahead of generic competitors.
However, due to a change in US government calculation for generic drug pricing, the company said it will stop producing a generic oral product containing the same active principles as Suboxone to mitigate financial risks.
Indivior said this decision is partly aimed at protecting its investment in Sublocade, a once-monthly injectable alternative to Suboxone, with patients still having the choice of three other rival generic products to Suboxone.
The UK and US-based company expects 2019 group net revenue to be between US$750mln-US$790mln, compared to previous guidance of US$670mln-US$720mln.
Net income is now estimated to be in the range of US$160mln-US$190mln, while it was previously US$80mln-US$130mln.
Cash at the end of the three months to September 30 is estimated to be US$1bn.
“We cannot be certain how long this benefit will last and hence we continue to prudently manage the additional cash flow this is providing us to help transition our business towards our novel depot technologies,” said chief executive Shaun Thaxter.
“This action is, however, necessary for Indivior to meet its obligations to its stakeholders and to continue our relentless focus on combating the opioid crisis with Sublocade,” he added, in relation to the discontinued product, mentioning the decision “was not taken lightly”.
Shares were up 12% to 55.66p on Tuesday morning.