Release Date: October 10, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Indivior PLC (INDV, Financial) continues to see strong interest and intention to treat with SUBLOCADE among criminal justice system (CJS) accounts, indicating long-term growth potential.
- The company expects solid year-over-year growth for SUBLOCADE in fiscal year 2024, with a projected 17% increase at the midpoint.
- SUBLOCADE's unique product profile, including rapid induction and alternate injection sites, is expected to maintain its leadership position in the long-acting injectable category.
- Indivior PLC (INDV) has been granted Priority Review by the FDA for important label updates, which could enhance SUBLOCADE's patient experience and market appeal.
- The company is actively seeking efficiencies to fuel SUBLOCADE's growth and support margins, including increased investment in awareness and sales force expansion.
Negative Points
- Indivior PLC (INDV) is facing increased competitive pressure, with competitors gaining initial adoption among SUBLOCADE prescribers faster than expected.
- The company is experiencing unpredictable volumes and modest pricing pressure in the criminal justice system channel due to funding variability.
- SUBLOCADE's net revenue forecasting accuracy is difficult in the near term due to increased competition and destocking impacts.
- Indivior PLC (INDV) no longer expects to deliver a $1 billion annual net revenue run rate for SUBLOCADE by the end of 2025 due to slower growth expectations.
- The company has issued multiple profit warnings, raising concerns about the stability and predictability of its financial performance.
Q & A Highlights
Q: Given the recent profit warnings, what confidence can you provide that there won't be another one, and is the $1.5 billion peak revenue target for SUBLOCADE still achievable?
A: Mark Crossley, CEO, explained that the recent market volatility was due to intensified competition, funding fluctuations, and stocking levels. The company has incorporated these learnings into their guidance, giving them confidence in their current projections. While they haven't specified timing for the $1.5 billion peak revenue, they remain confident in achieving it due to strong market data and physician feedback.
Q: What are the main drivers for the expected sequential decline in SUBLOCADE revenue in Q4, and how do you see the competitive environment affecting this?
A: Mark Crossley noted that the decline is primarily driven by accelerated competition and funding dynamics in the criminal justice system (CJS). They anticipate about $10 million in continued stocking dynamics, with the rest equally split between competition and funding issues.
Q: How are Medicaid disenrollments impacting your business, and what is the status of this issue?
A: Mark Crossley stated that the Medicaid disenrollments are proceeding as expected, with most states having completed the process. They anticipate the remaining states to finish by next year, and this has been factored into their guidance.
Q: How do you view the competitive landscape with Brixadi, particularly regarding its smaller needle size, and what are your expectations for market share stabilization?
A: Mark Crossley mentioned that while the smaller needle is a feature, it doesn't significantly impact patient experience compared to SUBLOCADE. They expect market share to stabilize as early adopters of Brixadi return to SUBLOCADE, which maintains strong share leadership.
Q: What strategies are you considering to counter competitive pressures and support SUBLOCADE's growth?
A: Mark Crossley emphasized focusing on SUBLOCADE's efficacy and unique product profile, increasing patient and physician awareness, and ensuring open access to treatment. They are also considering efficiencies in capital allocation to support growth and margins.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
