Indivior crashes after indictment by US federal grand jury, drags Reckitt lower

10th Apr 2019 08:06

(Sharecast News) - A US jury has indicted Indivior for fraudulently flogging its Suboxone Film drug as a safer alternative to rival treatments for opiod addiction.News of the federal grand jury's decision to formally bring charges against the specialty pharmaceuticals outfit saw the company's shares crash by 44% and prompted a quick response from the company.The allegations against it referred to actions that took part "almost exclusively" prior to Indivior being spun-off from Reckitt Benckiser, at the end of 2014, the company said in a statement.Indivior defended itself further, saying the allegations were unsupported by both the facts and the law, including those from the main US regulator, the Food and Drug Administration and the Centers for Disease Control in Atlanta.Nonetheless, management conceded that a negative verdict might have a "material adverse" effect on its financial position and outlook and lamented the DoJ's decision not to accept their offer for a settlement.The grand jury in the Western District of Virginia indicted the company on 28 counts of felony, including one count of healthcare fraud and another of conspiracy to commit mail, wire and healthcare fraud, together 22 counts of wire fraud.According to the indictment, Indivior reaped billions of dollars-worth of revenues from prescribing Suboxone Film and, via its "Here to Help" programme, put patients suffering from addiction in contact with doctors that were "prescribing opioids at high rates and in a clinically unwarranted manner."