Indivior Pharmaceuticals Inc.

10/29/2026 | Press release | Distributed by Public on 10/29/2026 06:15

Quarterly Report for Quarter Ending September 30, 2026 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion of our financial condition and results of operations should be read in conjunction with the unaudited condensed consolidated financial statements included in Part I, Item 1 of this quarterly report on Form 10-Q and with our audited consolidated financial statements, including the accompanying notes, and Management's Discussion and Analysis of Financial Condition and Results of Operations, included in our Annual Report on Form 10-K for the year ended December 31, 2025.
As the leader in long-acting injectable treatments for opioid use disorder (OUD), Indivior is singularly focused on delivering evidence-based treatment and advancing understanding of OUD as a chronic but treatable brain disease. For more than 25 years, Indivior has revolutionized the science of addiction medicine, developing treatments that help people move toward long-term recovery with independence and dignity. Building on this heritage, Indivior is ushering in a new era, renewing our commitment to individuals living with OUD and carrying forward what matters most: compassion, integrity, and science. Together - with science, people living with OUD, public health champions, and communities - we are powering recovery and renewing hope.
Operating Results
Overview
The Company operates as one business segment, which is predominantly the manufacture and sale of buprenorphine-based prescription drugs for the treatment of opioid dependence and OUD. Substantially all of our net revenue was derived from sales of SUBLOCADE and other buprenorphine-based sublingual products (including SUBOXONE Film, SUBOXONE Tablet and SUBUTEX Tablet). SUBLOCADE accounted for 75% and 74% of our net revenue for the three and nine months ended September 30, 2026, respectively, and 70% and 69% for the three and nine months ended September 30, 2025, respectively. Other buprenorphine-based sublingual products accounted for 24% and 25% of our net revenue for the three and nine months ended September 30, 2026 and 26% and 28% of our net revenue for the three and nine months ended September 30, 2025, respectively. SUBOXONE Film had an oral buprenorphine medically assisted treatment (BMAT) average share of approximately 14% and 15% in the three months ended September 30, 2026 and 2025, respectively, according to data from Symphony Health.
Recent developments
On August 1, 2026, the Company entered into an Agreement and Plan of Merger with Supernus. Pursuant to the Merger Agreement, which was approved by Indivior stockholders and Supernus stockholders on October 15, 2026 and, subject to the satisfaction or waiver of other specified closing conditions, the Indivior and Supernus businesses will combine in an all-stock merger of equals. The Merger Agreement provides that, upon the terms and subject to the conditions set forth in the Merger Agreement, the Company's Merger Sub, becoming a wholly-owned subsidiary will merge with and into Supernus, with Supernus continuing as the surviving company and a wholly-owned subsidiary of Indivior. Indivior will change its name to Supernus, Inc. following the transaction. We expect the transaction to close on or about November 2, 2026. For additional discussion of this matter, see Note 1. Business Overview, Basis of Presentation, and Recently Issued Accounting Standards and Note 15. Subsequent Events.
As part of the Indivior Action Agenda, on September 9, 2026 the Company agreed to an early termination of its existing tablet manufacturing agreement and to facilitate transition of tablet production to a new manufacturer in 2027. Cost of goods sold in the three months ended September 30, 2026 includes expense of $7 million associated with this early termination. Tablets are not sold in the United States..
On October 19, 2026, the Company entered into an asset purchase agreement with a third party to divest its SUBUTEX tablet business in France and Germany for $95 million. 90% of the purchase price will be paid at closing, with the balance to be paid upon regulatory approval of the transfer of the relevant marketing authorizations. The Company expects the transaction to close later in 2026, and for the
relevant regulatory approvals to be obtained in the first half of 2027. This business contributed less than 4% of the Company's total net revenues in 2025 with a smaller contribution expected in 2026. Additionally,at closing, the parties will enter into an agreement for the sale of remaining SUBUTEX inventory for the French and German markets upon transfer of the marketing authorizations.
Corporate initiatives during the three months ended September 30, 2026 included severance expense of approximately $3 million.
As disclosed in the second quarter, Indivior ceased Phase 3 development of INDV-6001 and also is not advancing INDV-2000 internally. The Company is not currently pursuing any pipeline activities.
For a discussion of recent developments with respect to litigation, see Item 1. Financial Statements--Note 13. Commitments and Contingencies.
Results of operations
Net revenue
Net revenue growth for the three and nine months ended September 30, 2026 as compared to the same periods of 2025 was primarily driven by sales of SUBLOCADE in the U.S.
Three Months Ended September 30, Nine Months Ended September 30,
(in millions) 2026 2025 % Change 2026 2025 % Change
U.S.:
SUBLOCADE*
252 203 24 % 707 561 26 %
Film/other
53 51 5 % 160 157 2 %
OPVEE - 8 (100) % 0 8 (99) %
PERSERIS
2 6 (67) % 12 19 (35) %
Total U.S.
307 267 15 % 880 745 18 %
Rest of the World 48 47 4 % 136 137 - %
Net revenue $ 356 $ 314 13 % $ 1,016 $ 881 15 %
*Total SUBLOCADE net revenue (U.S. and Rest of World)
$ 267 $ 219 22 % $ 753 $ 604 25 %
Total net revenue increased by $42 million, or 13%, and $134 million, or 15%, in the three and nine months ended September 30, 2026, respectively, as compared to the same periods of 2025. U.S. net revenue increased by $40 million, or 15%, and $135 million, or 18%, in the three and nine months ended September 30, 2026, respectively, as compared to the same periods of 2025.
U.S. net revenue. The U.S. is our largest market. Rebates, discounts and returns and other offsets to gross revenues are reflected in net revenue.
U.S. net revenue from SUBLOCADE increased by $49 million, or 24%, and $146 million, or 26%, in the three and nine months ended September 30, 2026, respectively, as compared to the same periods of 2025. The increases were driven by dispense unit volume growth, gross-to-net benefits and favorable price/mix in both periods. Dispense unit volume grew 17% and 18% in the three and nine months ended
September 30, 2026, respectively, as compared to the corresponding 2025 periods. Approximately 10% of the nine-month increase resulted from favorable gross-to-net adjustments.
U.S. net revenue from other products (including Film) decreased $9 million in the three months ended September 30, 2026, and $11 million in the nine months ended September 30, 2026, compared with the same periods of 2025. The decrease was primarily driven by the discontinuation of marketing activities for OPVEE and PERSERIS. Both periods of 2026 benefited from favorable Film gross-to-net adjustments that may not recur in future periods. Absent these favorable adjustments, US Film net revenue would have decreased by approximately 10% in the nine-month period.
Rest of World net revenue. Rest of World net revenue increased $2 million during three months ended September 30, 2026 and decreased slightly during the nine month period, compared to the same periods of 2025. Revenue in both periods benefited from agreements to provide additional volumes to certain markets ahead of planned market exits. As previously announced, our Rest of World business has been substantially optimized, including having exited several markets. As a result, we expect Rest of World net revenue to decline substantially in future periods.
Estimates, assumptions and judgments applied to determine the provision for rebates, discounts and returns are set out in "Item 8. Financial Statements-Note 2. Summary of Significant Accounting Policies" in our Annual Report on Form 10-K for the year ended December 31, 2025.
The following table provides a summary of activities with respect to accrued rebates and product returns and prompt pay discounts for the nine months ended September 30, 2026 and 2025:
Accrued rebates and product returns and prompt pay discounts (in millions)
September 30,
2026 		September 30,
2025
Opening balance at January 1
$ 585 $ 565
Accruals related to sales made in:
Current period 1,225 1,139
Prior period (97) (60)
Payments and credits (1,161) (1,028)
Closing balance at end of period
$ 552 $ 616
Accrued rebates and product returns include chargebacks as these are paid by Indivior. Prompt pay discounts are recorded as offsets to accounts receivable. Accrued rebates and product returns and prompt pay discounts decreased to $552 million as of September 30, 2026, from $616 million as of September 30, 2025, primarily due to the timing of rebate invoicing, payments and recognition of prior period benefits. A majority of the $97 million prior period benefit relates to Medicaid prior quarter adjustments. An additional one quarter of this benefit results from the receipt of unanticipated prior year refunds. These refunds are not expected to recur in future periods. Other prior period benefits are not expected to occur at a similar magnitude in future periods.
Expenses
Three Months Ended September 30, Nine Months Ended September 30,
(in millions) 2026 2025 % Change 2026 2025 % Change
Cost of sales $ 51 $ 83 (39) % $ 140 $ 179 (22) %
Gross margin
86 % 73 % 12 % 86 % 80 % 7 %
Operating expenses:
Selling, general and administrative 119 154 (23) % 364 445 (18) %
Research and development 5 33 (84) % 33 76 (56) %
Litigation settlement expenses(1)
- - NM - - NM
Total operating expenses 125 187 (33) % 398 521 (24) %
Loss on debt extinguishment
18 - NM
Net interest (income) expense (2) 6 (127) % 2 23 (93) %
Income tax expense
$ 45 $ (5) NM $ 109 $ 50 NM
Cost of sales. Cost of sales decreased $33 million, or 39%, and $39 million, or 22%, in the three and nine months ended September 30, 2026 as compared to the same periods of 2025. The decrease in both periods was driven by prior year nonrecurring charges, partially offset by $7 million of costs incurred during the three and nine months ended September 30, 2026 related to the early termination of the existing tablet manufacturing agreement as manufacturing activities are transitioned to a new provider. Prior year charges recognized in the three and nine months ended September 30, 2025 included impairment and other costs of $37 million related to the discontinuation of marketing activities for OPVEE. In addition, the nine months ended September 30, 2025 also included a $10 million SUBLOCADE inventory write-down.
Gross margin, which we define as gross profit divided by net revenue, was 86% and 86% in the three and nine months ended September 30, 2026, respectively, as compared to 73% and 80% in the corresponding periods of 2025. The increases in gross margin were primarily driven by SUBLOCADE volume growth and lower cost of sales as described above.
Selling, general and administrative expenses. Selling, general and administrative expenses decreased by $35 million, or 23%, and $80 million, or 18%, in the three and nine months ended September 30, 2026, respectively, as compared to the same periods of 2025. The decreases were primarily driven by headcount reductions and other cost savings related to corporate initiatives implemented in 2025 and 2026. Selling, general and administrative expenses included consulting, severance and other costs associated with corporate initiatives of $14 million and $25 million in the three and nine months ended September 30, 2026, respectively, compared to $22 million and $28 million in the prior-year periods.
Research and development expenses. Research and development costs in the three and nine months ended September 30, 2026 decreased by $27 million and $42 million, respectively, as compared to the same periods of 2025. The decrease reflected the cessation of pipeline development activities, including decisions earlier in the year to discontinue Phase 3 development of INDV-6001 and not advance INDV-2000 internally. Real estate consolidation and severance costs of $13 million were recognized in the nine months ended September 30, 2026, compared to $13 million in the three and nine months ended
September 30, 2025. The Company is not currently pursuing any pipeline activities and, as a result, does not expect to incur significant research and development costs in future periods.
Loss on extinguishment of debt. Loss on extinguishment of debt in the nine months ended September 30, 2026 includes $18 million of costs incurred in connection with the full repayment of the Company's Note Purchase Agreement.
Net interest (income) expense. Net interest income was $2 million for the three months ended September 30, 2026 and net interest expense was $2 million for the nine months ended September 30, 2026 as compared to net interest expense of $6 million and $23 million for the three and nine months ended September 30, 2025. The change primarily reflects the lower interest cost of the Convertible Notes compared to the Company's previous Note Purchase Agreement.
Income tax expense. On January 26, 2026, the Company completed a redomiciliation to the United States which resulted in a change in the applicable federal statutory income tax rate from 25% to 21%. Income tax expense of $45 million and $109 million in the three and nine months ended September 30, 2026 resulted in an effective tax rate of 25% and 24%, respectively, primarily driven by foreign earnings taxed at different tax rates, U.K. global minimum top-up tax, state taxes, disallowed expenses, and a write-off of U.K. Net Operating Losses, partially offset by U.K. innovation deductions. Income tax benefit of $5 million and income tax expense of $50 million in the three and nine months ended September 30, 2025, resulted in an effective tax rate of (14%) and 32%, respectively. Both periods benefited from intragroup financing transactions; however, in the nine months ended September 30, 2025 this benefit was fully offset by a tax reserve for an HMRC settlement.
Liquidity and Capital Resources
Overview
The Company's financial condition is summarized as follows:
(In millions)
September 30,
2026
December 31, 2025
Financial assets:
Cash and cash equivalents
$ 305 $ 195
Investments - long-term
27 28
Total cash and investments
$ 332 $ 222
Debt:
Current portion of long-term debt1
$ 488 $ 29
Long-term debt, less current portion1
$ - $ 290
1See Current Liabilities below for discussion of balance sheet classification of long-term debt.
Cash flows
Nine Months Ended September 30,
(in millions) 2026 2025
Net cash provided by (used in):
Operating activities
$ 317 $ 194
Investing activities
(41) (42)
Financing activities
$ (166) $ (25)
Operating activities
Net cash provided by operating activities was $317 million during the nine months ended September 30, 2026, compared to $194 million in the same period of 2025, an increase of $123 million. Net cash provided by operating activities in the nine months ended September 30, 2026 was driven primarily by cash generated from operations, partially offset by litigation settlement payments of $34 million and the timing of operational payments. Net cash provided by operating activities in the nine months ended September 30, 2025 primarily reflected cash generated from operations.
Investing activities
Net cash used in investing activities was $41 million and $42 million in the nine months ended September 30, 2026 and 2025, respectively, a decrease of $1 million. In both periods, net cash used in investing activities was primarily driven by capital expenditures related to the new Raleigh, North Carolina manufacturing facility.
Approximately $10 million of capital expenditures are expected to be incurred in the fourth quarter of 2026, primarily related to the Raleigh, North Carolina manufacturing facility.
Financing activities
Net cash used in financing activities in the nine months ended September 30, 2026 was $166 million, as compared to $25 million in the same period of 2025. The change was primarily driven by $292 million higher cash outflows for shares repurchased and canceled, partially offset by $151 million of net cash inflows related to the issuance of the Convertible Notes and payoff in full of the previous term loan in the nine months ended September 30, 2026.
During the nine months ended September 30, 2026, the Company successfully completed a $500 million offering of 0.625% Convertible Senior Notes due 2031. A portion of the $500 million proceeds was used to repay in full the $333 million balance of Indivior's original term loan. See Item 1. Financial Statements-Note 8. Debt for more details.
During the nine months ended September 30, 2026, the Company announced a $400 million share repurchase program and purchased 8,638,693 shares for total cash outflows of $300 million. The program runs through mid-2027.
Current Liabilities
Our current liabilities exceed our current assets by $501 million and total liabilities exceed our total assets by $60 million. The working capital deficit reflects the classification of the outstanding principal amount of our Convertible Notes as a current liability. Also, under the terms of the Convertible Notes, the Special Dividend declared on September 16, 2026 gave note holders a temporary right to convert their notes, which required classification of the outstanding principal as current as of September 30, 2026. After the temporary conversion expires, we expect the outstanding principal to be classified as noncurrent as of December 31, 2026, in line with the contractual maturity. We expect to continue to operate with negative
working capital in future periods due to the timing of rebate payments relative to collections of accounts receivable.
Capital resources
On September 16, 2026, Indivior declared a special cash dividend in an aggregate amount of $1,000 million, equal to $8.13 per share, which will be payable to (i) holders of record of the issued and outstanding Indivior Common Stock as of the record date of October 30, 2026, and (ii) holders of certain Indivior equity awards outstanding as of such date with respect to the Indivior Common Stock underlying such Indivior equity award, with such Special Dividend to be paid following the Effective Time (the "Special Dividend"). In connection with the Merger Agreement and the Special Dividend, Indivior entered into a commitment letter with Citibank, N.A. pursuant to which Citibank, N.A. has committed to provide, subject to the terms and conditions thereof, a senior secured term loan facility in an aggregate principal amount of $650 million. Proceeds from the senior secured term loan facility, together with cash on hand of the combined company, are expected to be used to fund the Special Dividend. Under certain limited circumstances where debt financing is unavailable, subject to certain additional conditions specified in the Merger Agreement, the Special Dividend would be payable as a combination of a $500 million cash dividend paid in connection with closing and a dividend of a $529 million dividend payment right, to be payable prior to the first anniversary of the closing date. For additional discussion of this matter, see Note 1. Business Overview, Basis of Presentation, and Recently Issued Accounting Standards.
The Company believes its existing cash and cash equivalents and investments together with cash generated from operations and debt will enable its anticipated cash needs to be met, including working capital, capital expenditures, litigation settlement payments, income taxes, debt repayments and other funding requirements, for at least the twelve-month period following the issuance of this Form 10-Q. The Company will need to sustain sales volume performance with no material change in the timing of its collections and rebate payments to maintain necessary liquidity in the near term and to meet our obligations in the long term. The Company is also subject to contingent liabilities as described in Item 1. Financial Statements-Note 13. Commitments and Contingencies.
Capital expenditures
Purchases of property and equipment were $41 million and $42 million for the nine months ended September 30, 2026 and 2025, respectively. The Company's capital expenditures primarily reflect investments in the new Raleigh, North Carolina manufacturing facility for SUBLOCADE.
Contractual obligations
Our contractual obligations as of September 30, 2026 that require material cash requirements in the future consist of debt repayments, litigation settlements, commercial commitments related to contract manufacturing and supply of materials, capital expenditures, and lease and employee-related obligations. Refer to "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" of our Annual Report on Form 10-K for the year ended December 31, 2025. Since December 31, 2025, significant changes to our contractual obligations include the issuance of the 2031 Convertible Senior Notes and repayment of debt under the Note Purchase Agreement, which altered the timing and amounts of future debt repayments. Additionally, corporate initiatives undertaken during the nine months ended September 30, 2026 resulted in lower lease obligations due to real estate consolidation and increased employee-related obligations associated with additional workforce reductions, most of which will be settled within one year.
Critical Accounting Estimates
Our significant accounting policies, which include management's estimates and judgments, are included in "Item 1. Financial Statements - Note 2 Summary of Significant Accounting Policies" of our Annual Report on Form 10-K for the year ended December 31, 2025. No significant changes to our accounting policies occurred during the quarter ended September 30, 2026. A discussion of accounting
estimates considered critical because of the potential for a significant impact on the financial statements due to the inherent uncertainty in such estimates is included in the Critical Accounting Estimates section of "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" of our Annual Report on Form 10-K for the year ended December 31, 2025.
Recently Issued Accounting Standards
For a discussion of recently issued accounting standards, refer to Item 1. Financial Statements - Note 1. Business Overview, Basis of Presentation, and Recently Issued Accounting Standards.
Indivior Pharmaceuticals Inc. published this content on October 29, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on October 29, 2026 at 12:17 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]