Minor victory for Indivior in Dr Reddy's court battle
Updated : 09:21
Indivior received some better news from the US courts overnight in its battle with drugmaker Dr Reddy's, which had developed a copycat version of the UK company's best-selling treatment.
The FTSE 250 company was successful in preventing Dr Reddy’s from selling its generic version of Suboxone Film for at a few more weeks potentially.
Previously the Court of Appeals for the Federal Circuit said a district judge in a previous trial was wrong to block Dr Reddy’s from selling its copycat film while a patent infringement suit is pending.
However on Tuesday the appeals court denied Dr Reddy's motion to immediately vacate Indivior's preliminary injunction preventing and ordered that any petition for rehearing be submitted on or before December 20 and no extensions will be granted.
As a result, the injunction will remain in place and Dr Reddy's will not be able to resume their "at-risk" launch of generic film in the US until after the Court of Appeal issues a new mandate.
Analysts at RBC Capital Markets said this could see a delay to the launch of one to three months - or more in the event that Indivior is successful.
"Ultimately this is positive for Indivior as every month it can keep the generic off the market is equivalent to c$70m in revenue - and $63m of gross profit."
Indivior is due update investors on 18 December, where RBC said it expected to hear more news on potential cost cutting, updates on the Sublocade launch and commercial plans in the face of the generic launching.
"In light of this new information we may hear on a ‘with and without’ generic plan, albeit we think investors will be modelling off a ‘with generic’ action plan from here. This has no material impact on our estimates today, unless the rehearing turns in Indivior’s favour but we also see this as potentially helpful should Indivior still be seeking a settlement with Dr Reddy’s – which would be a positive.
"Combined with the appeal court hearing on the 514 patent scheduled for 1H-2019 there is still some leverage for Indivior should it get Dr Reddy’s to the table."