Indivior Pharmaceuticals, Inc. · NASDAQ:INDV
Indivior Pharmaceuticals — FY2015 Earnings Presentation
44 slides from Indivior Pharmaceuticals's earnings presentation, Feb 18, 2016
Slide 1: A World Leading Addiction Treatment Company
A World Leading Addiction Treatment Company …with enormous future potential Full Year Results 2015 18th February 2016
Slide 2: Shaun Thaxter, Chief Executive Officer
Shaun Thaxter Chief Executive Officer
Slide 3: Forward Looking Statements
Forward Looking Statements This presentation contains certain statements that are forward-looking and which should be considered, amongst other statutory provisions, in light of the safe harbour provisions of the United States Private Securities Litigation Reform Act of 1995. By their nature, forwar
Slide 4: Agenda
AGENDA Cary Claiborne Financial Review - Profit & Loss Account - Dividends - Cash Flow - Balance Sheet Guidance for 2016 Javier Rodriguez Litigation Update Shaun Thaxter The future Question & Answers
Slide 5: Full Year Highlights
Full Year Highlights Financials Above Plan Operationally Strong Pipeline Continuing Progress •NR $1,014m •US market growth currently in high •Buprenorphine Monthly Depot Phase 3 trial on track: single digits •Op Profit $346m • efficacy last patient in Nov. 2015, •Suboxone Film share remains at • scr
Slide 6: No material change in market conditions
No material change in market conditions Generic Bup/Nal Tablet : Market Share No major shift in discounts in 2015 Teva on the market at end of 2014. Akorn (Hi-Tech) launched at end of 2015. Indications that generic discounts are stable Teva build-up in share remains slow – other generics’ share has
Slide 7: Competition is intensifying, but Film share remains resilient
Generic bup/nal tablets launched Branded tablet launched CVS formulary loss United formulary loss and 3rd generic tablet approved Bunavail Launch Competition is intensifying, but Film share remains resilient 7
Slide 8: New Market Size, Growth and Share Data
New Market Size, Growth and Share Data Driven by current supplier increasing their sample size & accuracy • Measures a more comprehensive sample of the market (94% coverage) • More detail behind the data for us to analyse performance and trends • Reduction in total market size with greater accuracy
Slide 9: Europe – austerity markets
Europe – austerity markets European share is holding up very well Market growth – austerity measures a drag •Generic First initiatives in France •Price gaps versus generics are challenging in some markets (eg UK, Italy) •Pricing may be further pressured • PPRS in UK • Likely further price deflation
Slide 10: Highlights of R&D delivery in 2015
Highlights of R&D delivery in 2015 Some challenges But significant progress continues to be made across the priority projects • Nasal Naloxone was a “known risk” and we stand •Label expansion for Suboxone Film (Buccal Indication) and new by our judgement of lower dose with better clinical patents ap
Slide 11: Cary Claiborne, Chief Financial Officer
Cary Claiborne Chief Financial Officer
Slide 12: P&L
12 P&L Full Year Ended 31st December: Unaudited Reported Adjusted $m 2014 2015 % change 2015 % change Net Revenues 1,115 1,014 -9% 1,014 -9% Cost of Sales (95) (97) (97) Gross Profit 1,020 917 -10% 917 -10% Gross Margin 91% 90% 90% Selling, Distribution and Administration Expenses (319) (408) +27% (
Slide 13: Quarterly Trend
Quarterly Trend 13 (%Δ at constant exchange: numbers may not aggregate due to rounding) $m Q1 % Δ Q2 % Δ Q3 % Δ Q4 % Δ Net Revenue 251 -8 266 -6 249 -5 248 -7% Gross Profit (% margin) 227 90% 242 91% 225 90% 223 90% SD&A (90) +19 (90) +10 (109) +23 (119) +70% R&D (20) +25 (34) +59 (36) +44 (42) -19%
Slide 14: Net Revenue – By Region
Net Revenue – By Region Net Revenue Commentary % USA Full Full % change $m Year Year change • Market growth low double digits for year Const 2014 2015 • Share loss from 62% to 59% FX • Tactical rebating in connection with formulary access USA 855 807 -6 -6 continued from H2 2014. Rest of World • Eur
Slide 15: Operating Expenses
Operating Expenses Margins Operating Costs FY 2015 Full Year 2014 2015 Adjusted 2015 Reported 2014 2015 % ch SD&A 319 408 +25 Gross margin 91% 90% 90% R&D 115 132 +15 Exceptional item (24) (31) - Operating margin 50% 37% 34% Depreciation & Amortisation Gross Margin only slightly changed, no signific
Slide 16: Tax Rate
Tax Rate Inherited Rate of 28% Underlying Rate of Actual Rate of 20% for for 2014 22% improved by: Full Year 2015 Reflects mix of profits between structuring of debt in US $4m exceptional tax credit UK and USA companies reduced rate to 20% Based on existing RB tax Change in US tax treatment of struc
Slide 17: Net Income & Earnings Per Share
Net Income & Earnings Per Share 2014 2015 % change Fully diluted EPS 31 cents Net Income ($m) 403 228 -43% Share Count Shares in Issue • Basic 719m 719 719 (million) • Full Dilution 733m EPS reported 56 32 -45% (cents) Adjusted EPS 34 cents basic 34 cents fully diluted Adding back the exceptional it
Slide 18: Over-delivery versus Guidance
Over-delivery versus Guidance Contributions to Net Income over-delivery vs. Guidance of $225m Extra Net Tax Rate Other (mainly debt buyback Revenue (22% vs 27%) Plus FX) $4m $14m $3m Takes $225m net income guidance to reported $246m adjusted net income 18
Slide 19: Dividends
Dividends Dividend for 2015 Future Dividend Policy • Prospectus indication to distribute • Board has considered future dividend policy 40% of net income as dividend for in the light of: - • Company’s current financial position 2015 as part of transition to Indivior. • Company’s strategy and prospect
Slide 20: Cash flows
Cash flows 20 Year to 31st December $m 2014 2015 Cash Flows from Operating Profit 562 346 Operating Activities Reversal of non-cash items (13) 5 Depreciation and amortisation 26 40 Changes in assets and liabilities (52) 127 Cash generated from Operations 523 518 Taxes and interest paid (83) (198) Ne
Slide 21: Cash Conversion
Cash Conversion Year to 31st December: $m 2014 2015 Cash Flows from Operating Profit 562 346 Operating Activities Reversal of other non-cash items (13) 5 Depreciation and amortisation 26 40 Changes in assets and liabilities (52) 127 Cash generated from Operations 523 518 Loan expenses and taxes paid
Slide 22: Balance Sheet
22 Balance Sheet $m As at 31st December 2014 2015 Intangible Assets 91 62 Other non-current Assets 91 154 Total Non-Current Assets 182 216 Cash and Cash Equivalents 331 467 Other current assets 234 254 Total Current Assets 565 721 Total Assets 747 937 Short term Borrowings (17) (34) Other Current Li
Slide 23: Cash & Borrowing Position at Full Year
Cash & Borrowing Position at Full Year Full Year Full Year 2014 2015 Cash & Cash Equivalents 331 467 Net Debt of $174m at full year, improvement of $254m in the year due to strong cash in-flow. Current Borrowings (17) (34) •Increase in cash of $136m Long-term Borrowings (719) (571) •Debt repaid of $
Slide 24: Financial Guidance for 2016
Financial Guidance for 2016 Full Year 2016 Guidance Net Revenue $m 945-975 Operating Margin % >30% Net Income $m* 155-180 *Excluding Exceptionals • At constant exchange rates (to estimated 2015 averages) • No material change in current market conditions; • Reinvestment of >$35m of the gross no det
Slide 25: Javier Rodriguez, Chief Legal Officer
Javier Rodriguez Chief Legal Officer
Slide 26: ANDA Litigation
ANDA Litigation • Trial in the lawsuits against Actavis and Par involving the • Trial against Alvogen in the lawsuit involving the Orange Book- Orange Book-listed patents for Suboxone® Film listed patents and process patents for Suboxone® Film scheduled November and December 2015. A decision in thes
Slide 27: FTC / Class Action Antitrust Litigation
FTC / Class Action Antitrust Litigation • The Judge overseeing the legal privilege dispute in the FTC • Fact discovery is underway in the Class Action litigation. investigation has appointed a Special Master (an independent external lawyer) to investigate the claims of legal privilege and • Amneal P
Slide 28: Department Of Justice Investigation BDSI Litigation
Department Of Justice Investigation BDSI Litigation • A federal investigation of Indivior’s marketing and • In Indivior’s appeal of the Patent Trial and Appeal promotion practices initiated in December 2013 is Board‘s (PTAB) decision in the Inter Partes Review of continuing. The United States Attorn
Slide 29: Shaun Thaxter, Chief Executive Officer
Shaun Thaxter Chief Executive Officer
Slide 30: The Pipeline update
The Pipeline update “ZINDIVIOR AS
Slide 31: Treatment of Opioid Use Disorder
TREATMENT OF OPIOID USE DISORDER Product Stage Status On track with pivotal efficacy trial (RB-US-13-0001): Last patient in achieved November 17th, 2015 Current status – Randomized: 505 RBP-6000: BUPRENORPHINE Phase 3 (US) ONCE MONTHLY IN ATRIGEL® Safety Extension Study (RB-US-13-0003) on trac
Slide 32: Rescue Medications for Drug Overdose; Treatment of Alcohol Use Disorder
RESCUE MEDICATIONS FOR DRUG OVERDOSE Product Stage Status US: Following FDA non-approval letter on November 23rd, NALOXONE INTRANASAL 2015, future strategy has been reviewed. SPRAY FOR OPIOID ATU (FRANCE) Decision is no further clinical development of current OVERDOSE TREATMENT formulation for U
Slide 33: Treatment of Psychiatric Co-morbidities
TREATMENT OF PSYCHIATRIC CO-MORBIDITIES Product Stage Status Efficacy/Safety pivotal trial (RB-US-09-0010): RBP-7000 (90, 120 mg) produced statistically and clinically significant mean reductions from baseline in Positive and Negative Syndrome Scale (PANSS) total scores and significantly improved
Slide 34: New Peer-Reviewed Publications
New Peer-Reviewed Publications Heidbreder C., Johnson RE, Chapleo C, Fudala PJ (2015) Indivior: Pioneering research and development in the treatment of addictions. Nature, 522 (7557): Supp. S45-S63. http://www.nature.com/nature/outlook/addiction/pdf/Indivior.pdf Liu Y, Li X, Xu A, Nasser AF, Hei
Slide 35: An Innovative Pipeline Designed to Improve Patient Outcomes
AN INNOVATIVE PIPELINE DESIGNED TO IMPROVE PATIENT OUTCOMES Stages of development and earliest approval dates* Stage of Development Estimated Approval Dates Phase I Phase II Phase III NDA 2015 2016 2017 2018 2019 2020 Buprenorphine Lifecycle Suboxone® Tablet China Suboxone® Film Can ? China EU ? Bup
Slide 36: The Future
The Future “Z INDIVIOR AS
Slide 37: Indivior PLC – Priorities for 2016
37 Indivior PLC – Priorities for 2016 Resolve ANDA litigation and secure long-term certainty for Company 1.Suboxone Film 2. Develop the 3. Refinance Company 4. Expand Global Resilience pipeline ready for BD / M&A treatment Preserve leadership • Transformational • Expand business • New treatment area
Slide 38: Potential Market Growth is being assisted by government focus
Potential Market Growth is being assisted by government focus Heroin abuse in states like New Hampshire make it a top campaign issue Obama Administration Announces Jan 2016. Obama Tells Outdated Opioid Public and Private Sector Efforts to Treatment Industry It's Time To Change Address Prescription D
Slide 39: Agenda for 2016 - 1
Agenda for 2016 - 1 Date Activity Event Q1 Jan 10-14 JP Morgan Conference Presenting Weds Jan 13th Feb 18 FY 2014 Results Presentation in London Feb 28 Expiry of Actavis 30 month stay of execution Actavis ANDA litigation March 7 BAML bus trip London March Markman hearing re Process Patents Actavis,
Slide 40: Agenda for 2016 - 2
Agenda for 2016 – 2 Date Activity Event Q3 Q3 Arbaclofen Placarbil for Alcohol use disorder Final CSR phase 2A study (RB-US-14-0001) July 29 Half Year Results Presentation in London Sept 12 Morgan Stanley Conference Presentation in New York Sept 25 Par - expiry of 30 month stay of execution Par ANDA
Slide 41: Indivior – R&D Day 2016
INDIVIOR – R&D DAY 2016 Q4 2016 New York – venue to be announced Invitations to be sent out in September We aim to live webcast for those who cannot travel to New York. 41
Slide 42: Summary
Summary Increasing confidence in our medium-term future •Strong progress on developing our pipeline of exciting innovations in addiction •Litigation updates continue to support our confidence in our IP Outlook for 2016 much stronger than original demerger assumptions •Stronger profits and cash flow
Slide 43: Thank You!
THANK YOU! SIEINDIVIOR
Slide 44: A World Leading Addiction Treatment Company
A World Leading Addiction Treatment Company …with enormous future potential