Indivior PLC(US:INDV)2025-07-31 16:59PART I - FINANCIAL INFORMATION Unaudited Financial Statements This section presents the unaudited condensed consolidated financial statements for Q2 2025 and 2024, showing a shift to a net income of $18 million in Q2 2025 from a $97 million net loss in Q2 2024 due to the absence of a prior-year litigation settlement expense Condensed Consolidated Statements of Operations Highlights (in millions) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net revenue | $302 | $299 | $568 | $583 | | Gross profit | $250 | $220 | $472 | $466 | | Operating income (loss) | $72 | $(118) | $138 | $(43) | | Net income (loss) | $18 | $(97) | $65 | $(36) | | Diluted earnings (loss) per share | $0.14 | $(0.72) | $0.52 | $(0.27) | Condensed Consolidated Balance Sheets Highlights (in millions) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total current assets | $951 | $827 | | Total assets | $1,452 | $1,316 | | Total current liabilities | $1,056 | $924 | | Total liabilities | $1,709 | $1,652 | | Total shareholders' deficit | $(257) | $(337) | Condensed Consolidated Statements of Cash Flows Highlights (in millions) | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $233 | $51 | | Net cash (used in) provided by investing activities | $(22) | $26 | | Net cash used in financing activities | $(22) | $(91) | Note 2: Segment, Geographic and Other Revenue Information The company operates as a single segment, with Q2 2025 net revenue increasing 1% to $302 million, driven by a 9% rise in U.S. SUBLOCADE sales Net Revenue by Product and Geography (in millions) | Product/Region | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | U.S. SUBLOCADE | $195 | $179 | $359 | $346 | | U.S. Sublingual & other | $52 | $63 | $107 | $126 | | U.S. PERSERIS | $8 | $13 | $12 | $23 | | Total U.S. | $256 | $255 | $478 | $496 | | Rest of World | $46 | $44 | $90 | $87 | | Total Net Revenue | $302 | $299 | $568 | $583 | - The company operates in a single operating and reportable segment, with the CEO identified as the chief operating decision maker (CODM)36 Note 3: Income Tax The effective tax rate for Q2 2025 was 71%, significantly higher than the U.K. statutory rate, primarily due to a $33 million tax reserve for a U.K. HMRC settlement Effective Tax Rate | Period | 2025 | 2024 | | :--- | :--- | :--- | | Three Months Ended June 30 | 71% | 19% | | Six Months Ended June 30 | 46% | 25% | - A tax reserve of $33 million was recorded in Q2 2025 for a settlement with U.K. HMRC related to a finance structure in place from 2019 through May 202448 - The company is evaluating the implications of the new U.S. tax legislation, the 'One Big Beautiful Bill Act', but does not currently anticipate significant impacts35 Note 12: Commitments and Contingencies The company faces significant legal proceedings, including civil opioid litigation with a $79 million provision, and dental injury lawsuits with over 21,000 plaintiffs where loss cannot be estimated - A provision of $79 million has been recorded for a settlement in the civil opioid litigation, expected to be finalized in or before November 2025, pending sufficient participation from states and subdivisions8560 - The company is a defendant in multi-district litigation (MDL) involving 1,877 cases and 21,402 plaintiffs alleging SUBOXONE Film caused dental injuries, but cannot estimate possible loss at this stage8893 - A multiparty shareholder claim remains pending in the U.K. alleging false or misleading statements related to the product switch from SUBOXONE Tablets to SUBOXONE Film94 Note 13: Revision of Previously Issued Financial Statements The company revised its 2022-2024 financial statements to correct an error in the U.S. Branded Fee accrual, increasing FY 2024 net income from $2 million to $7 million - An error was identified in the methodology used to accrue for the annual U.S. fee on drug manufacturers (the 'Branded Fee'), resulting in an overstatement in prior periods99 Impact of Revision on FY 2024 Consolidated Statement of Operations (in millions) | Metric | As Reported | Adjustment | Revised | | :--- | :--- | :--- | :--- | | Operating income | $32 | $6 | $38 | | Net income | $2 | $5 | $7 | | Diluted EPS | $0.02 | $0.03 | $0.05 | Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses a 1% Q2 2025 net revenue increase to $302 million, driven by SUBLOCADE's 9% growth, improved gross margin to 83%, and a strengthened cash position of $510 million Operating Results Q2 2025 net revenue increased 1% to $302 million, driven by a 9% rise in U.S. SUBLOCADE revenue, while gross margin improved to 83% due to lower discontinuation costs Net Revenue by Product (in millions) | Product | Three Months Ended June 30, 2025 | % Change YoY | | :--- | :--- | :--- | | SUBLOCADE (Total) | $209 | 9% | | U.S. Film/other | $52 | (18)% | | PERSERIS | $8 | (37)% | - SUBLOCADE accounted for 69% of net revenue for the three months ended June 30, 2025, up from 64% in the same period in 2024114 - Gross margin increased to 83% in Q2 2025 from 74% in Q2 2024, reflecting $41 million in costs in the 2024 period related to the discontinuation of marketing and promotion of PERSERIS125 Liquidity and Capital Resources Cash and cash equivalents reached $510 million as of June 30, 2025, with net cash from operating activities increasing to $233 million in H1 2025, partly due to $120 million in government rebate payments Financial Position (in millions) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $510 | $319 | | Total cash and investments | $538 | $347 | | Total Borrowings (Short & Long-term) | $326 | $333 | - Net cash from operating activities increased by $182 million in H1 2025 compared to H1 2024, benefiting from the timing of receipt and processing of approximately $120 million in government rebate invoices137 - The company anticipates capital expenditures of $50 million to $70 million for the full year 2025, primarily for the SUBLOCADE suite at the Raleigh Manufacturing Facility141 Regulatory Uncertainties The company is monitoring the 'One Big Beautiful Bill Act' (OBBBA), enacted in July 2025, which could impact Medicaid funding and eligibility rules, with most provisions effective in 2027-2028 - The OBBBA, signed into law in July 2025, could impact the business through changes to Medicaid funding, eligibility rules, and state formularies133 - Most of the OBBBA provisions have effective dates in 2027 and 2028, and additional federal and state guidance is expected for implementation134 Quantitative and Qualitative Disclosures About Market Risk No material changes in market risk have occurred since the information provided in the Company's Annual Report on Form 10-K - No material changes in market risk have occurred from the information provided in the Company's Annual Report on Form 10-K152 Controls and Procedures Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that Indivior PLC's disclosure controls and procedures were effective as of June 30, 2025153 - No changes occurred during the quarter ended June 30, 2025, that have materially affected, or are likely to materially affect, the Company's internal control over financial reporting154 PART II - OTHER INFORMATION Legal Proceedings This section incorporates by reference the detailed descriptions of the company's litigation and regulatory matters from Note 12 of the financial statements - The descriptions of litigation and regulatory matters are incorporated by reference from Note 12, 'Commitments and Contingencies'156 Risk Factors The company has omitted the risk factor concerning multi-exchange share listings due to its recent delisting from the London Stock Exchange to trade exclusively on Nasdaq - The company has omitted the risk factor related to its ordinary shares being listed on more than one stock exchange157 Unregistered Sales of Equity Securities and Use of Proceeds During Q2 2025, the company repurchased 15,047 shares at varying average prices, primarily to cover withholding taxes on employee equity awards, not as part of a public plan Share Repurchases for Q2 2025 | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 2025 | 2,484 | $9.53 | | May 2025 | 2,669 | $12.41 | | June 2025 | 9,894 | $13.86 | - The repurchased shares reflect shares netted to pay applicable withholding taxes on the release of awards under the 2020 LTIP, 2022 LTIP, and 2023 DBP158 Other Information Key updates include Indivior no longer qualifying as a 'foreign private issuer' from January 1, 2026, and the termination of a supply agreement with Curia Massachusetts effective January 31, 2026, for manufacturing consolidation - As of June 30, 2025, Indivior determined it no longer qualifies as a 'foreign private issuer' and will become subject to SEC rules for U.S. domestic issuers starting January 1, 2026161 - On July 31, 2025, Indivior provided notice to terminate its Master Development and Supply Agreement with Curia Massachusetts, Inc., effective January 31, 2026, as part of a plan to consolidate manufacturing locations162 Exhibits This section lists exhibits filed with the Form 10-Q, including amended Articles of Association, various agreements, and CEO/CFO certifications required by Sarbanes-Oxley Act