Indivior PLC announced that the U.S. Court of Appeals for the Federal Circuit (CAFC) vacated the preliminary injunction (PI) previously granted against Dr. Reddy’s Laboratories (DRL) by the U.S. District Court for the District of New Jersey on July 13, 2018. The injunction had prevented DRL from selling, offering to sell, or import its generic buprenorphine/naloxone sublingual film product.

In the absence of a PI, Indivior assumes that DRL will resume the launch of its generic buprenorphine/naloxone sublingual film product in the U.S. following the issuance of the mandate from the CAFC. Any DRL generic product sales in the U.S. would be on an “at-risk” basis, subject to the outcome of the appeal of the non-infringement judgments related to U.S. Patent Nos. 8,603,514 and 8,017,150, and ongoing litigation against DRL in the District of New Jersey asserting recentlygranted Orange Book-listed patents (including U.S. Patent No. 9,931,305).

The exact timing for DRL’s potential U.S. market re-entry is unknown, as the PI typically remains in effect until the issuance of a mandate by the CAFC (a formal filing by the CAFC that returns the case to the District Court for actions consistent with the CAFC’s ruling). Following today’s ruling vacating the PI, DRL filed a motion requesting that the CAFC either issue the mandate immediately or, alternatively, stay the PI pending issuance of the mandate. The Company will oppose DRL’s motion and file a petition for both panel rehearing and rehearing en banc of the ruling vacating the PI.

Indivior’s FY 2018 guidance for net revenue of $990-$1,020m and net income of $230-255m, which was issued on September 26th and confirmed on November 1st, was based on no material changes in current market conditions in the U.S. As such, the Company’s current FY 2018 guidance remains valid unless there is certainty of generic buprenorphine/naloxone sublingual film entry in 2018, in which case there would be risk to FY 2018 guidance. The magnitude of the risk will depend upon the timing of any generic entry.

Should generic buprenorphine/naloxone sublingual film enter the market in 2018, the result would most likely be a rapid and material loss of market share for SUBOXONE® (buprenorphine and naloxone) Sublingual Film. Industry analogs1 suggest that a launch in the U.S. of a generic product that can be directly substituted by a pharmacist for the branded product without consultation with the patient would result in the branded incumbent (in this case, Suboxone® Film) losing up to 80% of its market share within a matter of months. A material loss in market share in the U.S. would have a significant adverse impact on the Company’s revenues, profitability and cash flows.

“We are surprised and disappointed that the court has vacated the preliminary injunction,” said Shaun Thaxter, CEO of Indivior. “We will continue to vigorously pursue our infringement cases against DRL to protect our SUBOXONE® Film patent portfolio, including filing a petition with the CAFC for both panel rehearing and rehearing en banc of the ruling vacating the PI, as well as opposing DRL’s motion to immediately issue a mandate or stay the current PI until the mandate is issued.

“We are continuing to pursue the appeal of the U.S. District Court for the District of Delaware’s noninfringement decision related to U.S. patents 8,603,514 and 8,017,150, as well as litigating our recently listed Orange Book patents for SUBOXONE® Film.

“While we ultimately believe in the strength of our patent portfolio, we acknowledge that the Company faces challenges in the intervening period resulting from a potential material and rapid loss of market share to generic buprenorphine/naloxone sublingual film competition, including reduced earnings and cash flow.”

As the current leading provider of buprenorphine-based medication-assisted treatment (BMAT) in the U.S., Indivior is committed to continuing to realize its Vision that all patients around the world have access to evidence-based treatment for the chronic condition and co-occurring disorders of addiction. The Company is in advanced stages of contingency planning. In light of the timing of this judgement, we will now undertake a full review of our plans and will update the market on the Company’s path forward as soon as practicable.

About SUBOXONE®

Indication

SUBOXONE®(buprenorphine and naloxone) Sublingual Film (CIII) is a prescription medicine indicated for treatment of opioid dependence and should be used as part of a complete treatment plan to include counseling and psychosocial support. Treatment should be initiated under the direction of healthcare providers qualified under the Drug Addiction Treatment Act.