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(Alliance News) - Indivior PLC on Thursday posted a fall in earnings for 2020 despite seeing a year-on-year improvement in its fourth quarter, noting that while it expects conditions to improve as Covid-19 restrictions subside, the possibility remains that 2021 will be significantly hurt by the Covid-19 pandemic.
Shares in the FTSE 250-listed drug manufacturer were trading 2.8% lower at 144.90 pence each on Thursday morning in London.
For 2020, Invidior swung to a pretax loss of USD173 million from a USD180 million profit recorded on 2019. This was as net revenue fell 18% year-on-year to USD647 million from USD785 million amid competition from cheaper generic drugs to treat opioid dependence as well as disruption from the pandemic.
Selling, general and administrative expenses rose to USD666 million from USD414 million. Exceptional expenses totalled USD244 million, up from just USD24 million in 2019 as a result of litigation settlements and higher administrative costs from growth investments in opioid addiction treatment Sublocade.
In November, Indivior announced that former parent Reckitt Benckiser PLC had submitted a claim against the company. The claim related to an indemnity contained in the demerger agreement entered into between the two companies in November 2014. In January, the company said Reckitt withdrew the USD1.4 billion claim, with both companies agreeing that Indivior should pay a total of USD50 million over the next five years.
More significantly, in mid-July, Indivior agreed to part with USD600 million to resolve fraud charges with the US Justice Department in relation to Suboxone.
The deterioration in the full year came despite of the company's pretax loss in the fourth quarter narrowing significantly to USD14 million from a USD42 million loss a year before and net revenue rising 39% to USD185 million from USD133 million.
Looking ahead, Slough-based Indivior said: "Base case net revenue guidance assumes the operating backdrop will improve in first half 2021, as Covid-19 pandemic restrictions impacting in-person healthcare practitioner access subside and healthcare systems approach normality. In a downside scenario in which the operating backdrop continues to be adversely impacted by pandemic restrictions through second half 2021, Indivior believes total net revenue for 2021 could be adversely impacted by up to USD60 million. On this basis, total net revenue could be around USD565 million."
By Ife Taiwo; ifetaiwo@alliancenews.com
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