Wed, Mar 13, 2019 - Page 10 News List

Dr Reddy’s wants Indivior to pay for opioid delay

Bloomberg

Dr Reddy’s Laboratories Ltd is seeking more than US$70 million from Indivior PLC as compensation for lost US sales of its generic version of a leading opioid addiction treatment that was delayed in a patent dispute with the UK-based drugmaker.

Indivior in July last year blocked Dr Reddy’s generic version of Suboxone Film through a court injunction, despite the Indian company receiving regulatory approval to sell the market-leading product for treating opioid dependence.

Last month, the US Supreme Court refused to uphold that injunction, allowing Dr Reddy’s to resume sales of the drug.

“If we were not injuncted by the court, we would have made a lot of money,” Dr Reddy’s managing director and chief executive G.V. Prasad said in an interview in Hyderabad. “If we get the lost profits, it’ll certainly outperform.”

Suboxone is the leading prescription drug used to treat opioid abuse, which affects about 2 million adults in the US and has turned into an addiction crisis that the US Centers for Disease Control and Prevention estimates kills 130 Americans every day.

Suboxone Film — absorbed by being placed under the tongue or inside the cheek to treat addiction to opioids, including heroin and prescription painkillers — accounted for almost all of Indivior’s US$1 billion in sales last year.

It will now be a big boost for Dr Reddy’s, which gets nearly half of its revenue from North America.

Indivior posted a bond of US$72 million to cover Dr Reddy’s potential claim of lost profit while the injunction was contested, Prasad said.

The firm is claiming that it is owed more than that, since the injunction lasted longer than the bond was meant to cover. He declined to say how much the company is asking for.

Notwithstanding legal costs and the three other generic versions of Suboxone Film that have entered the US since Dr Reddy’s legal victory, Prasad said his company could still get about one-quarter of the market share, making it a profitable product.

“It will be a huge boost if they get that compensation,” said Amey Chalke, equity analyst for HDFC Securities Ltd in Mumbai, who estimates the Indian drugmaker might have lost as much as US$160 million in sales due to the injunction.

If Dr Reddy’s recovers a sum close to that figure, it would be scooping up 60 percent of last year’s profit in one go, Chalke said.

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