Score one for Indivior Plc.
The pharmaceutical company, whose stock trades on the London Stock Exchange, climbed 20.3% on Monday after a New Jersey district court June 13 blocked Dr. Reddy's Laboratories Ltd.'s (RDY - Get Report) from selling its generic opioid treatment drug in the U.S., according to a press release from Indivior. Dr. Reddy's fell about 9% in trading Monday on the news of the preliminary injunction.
The two competitors are currently embroiled in a patent-infringement lawsuit over Indivior's Suboxone sublingual film treatment since June, when Dr. Reddy's received FDA approval for its generic version. Indivior was granted a temporary restraining order Sunday.
Indivior generates most of its revenue from the sales of its Suboxone products and conducts 80% of its business in the U.S., according to FactSet data. The company has already had to fend off generics from taking over the opioid treatment market and the few weeks Dr. Reddy's was able to sell its product forced Indivior to change its guidance for the rest of 2018, according to a press release.
"We are continuing to monitor U.S. market developments to better gauge [Dr. Reddy's Laboratories'] launch impact. We know that they are skilled in rapid distribution in quantity and, as such, there is a range of uncertainty around the amount of product they were able to ship before the temporary restraining order was granted by the court," Indivior CEO Shaun Thaxter said in a press release.
Indivior anticipates the rapid market loss from Dr. Reddy's film treatment will cost the company $25 million in revenue this year. The company said it plans on having an updated guidance "no later" than when it announces its third quarter earnings results.
Dr Reddy's, which is based in India, will not be able to continue its re-launch of its generic brand until the lawsuit is resolved or an appeals court rules against the injunction. A Dr. Reddy's representative said the company planned on appealing Judge Kevin McNulty's decision, according to an interview with Bloomberg.
"While we do not know the timing for these events, we will continue to vigorously defend our intellectual property," Thaxter said in the press release.