Indivior Provides Business Update; Conference Call at 8: 00 AM U.S. EDT

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATION (EU) 596/2014 (AS IT FORMS PART OF DOMESTIC LAW IN THE UK BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018).

RICHMOND, Va., July 9, 2024 /PRNewswire/ -- Indivior PLC (Nasdaq/LSE: INDV) today announces a business update encompassing the Group's outlook for Q2 and FY 2024 financial performance, its product portfolio and litigation. Indivior is:

• Updating Q2 net revenue (NR) expectations and FY 2024 guidance to reflect continued adverse market dynamics impacting near-term SUBLOCADE NR growth as well as the initial commercial adoption of OPVEE; At the mid-point, the Group continues to expect strong YOY NR growth for SUBLOCADE of 25% and YOY adjusted operating income growth of 12% in FY 2024;
• Reiterating its medium-term financial outlook for double-digit NR growth and operating margin expansion, based on its confidence in achieving its intermediate and peak NR goals for SUBLOCADE as well as peak NR expectations for OPVEE;
• Discontinuing sales and marketing for PERSERIS due to expected adverse impacts from increased payor management of the category that crystalized in Q2 and that are expected to make the product no longer financially viable; and,
• Reaching a settlement agreement with end payor plaintiffs in the Health Care Services Corp (HCSC) consolidated cases to resolve the litigation for $85m.

Comment by Mark Crossley, CEO of Indivior PLC"Despite positive early performance trends at the start of the second quarter, SUBLOCADE net revenue (NR) has continued to be impacted more than we expected by a combination of transitory factors, primarily the elimination of COVID emergency measures related to automatic Medicaid coverage renewals. Furthermore, as we look to the second half of the year, the U.S. government has extended renewal allowances for certain States which will further delay the annualization of this significant headwind. We are therefore reducing our FY 2024 guidance to reflect these impacts. Importantly, despite the disproportionate disruption to our patient base, we expect SUBLOCADE NR to grow by 25% at the mid-point of our new guidance range, reflecting strong underlying demand.

Looking beyond these transitory impacts, we remain firm in our conviction that SUBLOCADE's unique profile to address high-powered synthetic opioids, such as fentanyl, provides us with a tremendous opportunity to meet the growing and changing needs of patients. As a result, we continue to be confident that SUBLOCADE will achieve a net revenue run rate of $1 billion as we exit 2025 and ultimately meet our target of greater than $1.5 billion in peak annual net revenue, underpinning the successful delivery of our medium-term profitable growth ambitions.

Separately, we are taking decisive action that we believe is in the best interest of shareholders in two areas. First, we are creating greater certainty for all stakeholders by settling with Plaintiffs ahead of our antitrust trial on July 15th. Second, due to anticipated increased payor management of the category that makes PERSERIS' future no longer financially viable, we have determined to take the required actions to discontinue the product. While we believe discontinuing PERSERIS is the right business decision, unfortunately it will impact our people and patients, and we will support them through this transition."

Discontinuation of PERSERIS Sales & Marketing:The Group will immediately cease all sales and marketing activities related to PERSERIS. The Group believes this action is in the best interests of shareholders due to the highly competitive market and impending changes that are expected to intensify payor management in the treatment category in which PERSERIS participates. Analysis of forthcoming changes suggests that there is no longer a path forward for PERSERIS that is financially viable. Indivior will continue to supply PERSERIS for the foreseeable future to avoid disruption to patient care but will no longer deploy a dedicated sales force. As a result, we expect to reduce headcount by approximately 130 employees. Indivior does not anticipate material impacts on its other marketed products because of this decision.

Total expected charges related to this action are expected to be approximately $65m, of which approximately $20m are expected to be cash related to severance and termination of certain agreements. These charges will be recognized in the second and third quarters and excluded from adjusted earnings. Ongoing annual operating expense savings are expected to be approximately $50m, with $20m expected to be realized in H2 2024. The impact of this decision on FY 2024 guidance is included in the updated guidance set out below.

Preliminary Q2 Net Revenue Expectations:

The Group is providing the below preliminary expectations for key NR drivers for Q2 2024.

Continued transitory patient treatment disruptions from ongoing Medicaid disenrollments that accelerated at the end of the quarter have disproportionately impacted SUBLOCADE. Combined with lower-than-expected stocking levels in key channels and longer-than-expected activation times with new criminal justice system accounts, SUBLOCADE NR was lower than expected in the second quarter.

• Ongoing Medicaid disenrollments in the second quarter continued to impact new patient starts and refills. At the end of the second quarter, Medicaid disenrollments stood at approximately 23 million1 versus approximately 19 million1 at the end of the first quarter. The continued decline in Medicaid patient levels in the second quarter combined with fewer patients returning to treatment from first quarter Medicaid disenrollments and the Change Healthcare cyber-attack disruption had a greater than expected impact on NR performance in the second quarter. As a result, despite early positive performance trends in the quarter, overall new SUBLOCADE patient growth and refills were below expectations. In addition, Medicaid renewal actions in some instances are being permitted by Centers for Medicare & Medicaid Services (CMS) to extend into the third quarter, likely prolonging the period of SUBLOCADE patient disruption.

• Stocking in the second quarter was also lower than expected, as days of SUBLOCADE inventory on-hand remained relatively unchanged at first quarter levels of under two weeks, which is historically low. The Group now believes its specialty pharmacy and specialty distributors have made permanent one-off inventory adjustments to take advantage of shortened lead times associated with supply efficiencies to organized health and criminal justice system customers.
• While SUBLOCADE NR from the criminal justice system continued to grow strongly in the second quarter, increasing approximately 85% compared to the year-ago quarter, longer lead times to open new criminal justice system accounts also impacted expectations for NR in the second quarter. The Group remains confident this timing issue does not undermine the potential for SUBLOCADE to address the large unmet need in this important and growing new channel.
• Impact of competitor activity was in line with expectations.

OPVEE NR in the second quarter was immaterial (