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Jefferies ups target price on Indivior ahead of Sublocade launch
Encouraged by Indivior's update on the launch of its Sublocade monthly opioid addiction treatment, Jefferies showed its confidence in the drug maker with an improved target price and a reiterated 'buy' rating.
While reported sales were down 8.4% across the US in the first quarter, Jefferies analysts noted that a one-off de-stocking effect was responsible for around 3-4% of the weakness, leading them to forecast a slight increase to net price erosion from less favourable payer mix.
The analysts expect sales of Sublocade, a once-monthly injectable buprenorphine formulation for the treatment of 'moderate-to-severe' opioid addiction, to be minimal in the first half of the year, however, the firm indicated that its initial launch had been encouraging, with positive feedback from both patients and doctors.
"Demand appears to be strong, such that the company's go-to-market Insupport hub has experienced some logistical challenges given the volume of patients, but we expect increased investment and resources here should rectify those at this early stage," the Tuesday report from Jefferies read. "We are encouraged by the initial launch and maintain our bullish stance."
"Despite a recent strong share price move, we continue to believe the market is overly discounting Sublocade and there is still compelling upside to the current share price, in our view."
Jefferies upped Indivior's price target to 630p, from 610p, and reiterated its 'buy' stance on the stock.