Transformation
Total Page：16
File Type：pdf, Size：1020Kb
Annual Report 2019 Inspiring patient transformation Annual Report 2019 Contents Inspiring patient Strategic report 1 2019 highlights 3 Chair’s statement 6 Patient stories transformation 10 Chief Executive Officer’s statement and Q&A Delivering on patient needs continues to inspire us 18 Business model at Indivior. We are encouraged that around the world 20 Our stakeholders opioid use disorder is being increasingly recognized 24 Research and development as a treatable medical disease and not a moral failing. 26 Managing our business Ultimately, we believe that patients want, need and responsibly deserve reprieve from the cycle of addiction so that 30 Non-financial information they can recover meaning and purpose to their life. statement 31 Financial review 35 Legal proceedings 39 Risk management 45 Viability statement Governance 46 Chair’s governance statement 48 Board of Directors 50 Executive committee 52 Corporate governance 75 Directors’ remuneration report 92 Directors’ report Financial statements 95 Statement of Directors’ responsibilities 97 Independent Auditor’s report 107 Financial statements 151 Information for shareholders Nathalie’s story p6 Ashlynn’s story p8 2019 highlights Our Vision is that all patients around the world have access to evidence-based treatment for the chronic conditions and co-occurring disorders of addiction. See our business model on pages 18 to 19 2019 Financial Highlights $785m $178m $134m $1,060m Net revenue Operating profit Net income Year-end cash balance (-22% vs. 2018: $1,005m) (-39% vs 2018: $292m) (-51% vs 2018: $275m) (+15% vs 2018: $924m) $72m $202m $176m $821m Net revenue from Adjusted operating profit* Adjusted net income* Year-end net cash balance SUBLOCADE (2018: $12m) (-39% vs 2018: $332m) (-35% vs 2018: $272m) (+21% vs 2018: $681m^) R&D highlights $53m 13 37 R&D investment Peer reviewed Conference (-21% vs. 2018: $67m^) publications presentations * Excluding exceptional items (further details on pages 116 to 118). ^ Excludes $24 million of exceptional impairment related to the Arbaclofen Placarbil and ADDEX assets. Indivior Annual Report 2019 1 “ Our dedication to advancing Indivior’s patient-focused strategy through this period of uncertainty was, however, rewarded in the good strategic process we saw throughout 2019. ” 2 www.indivior.com Strategic report Chair’s statement Dedicated to advancing our patient-focused strategy 2019 was clearly a challenging year, marked by the U.S. government’s action against Indivior. The Board has worked to address these allegations head on. It was also conscious of the impact they could have on the Group’s workforce, shareholders and other key stakeholders. Indivior’s transparent response, including my open letter supporting the Group’s position and refuting the government’s allegations, ensured that our stakeholders were supplied with all of the information that we were able to convey about this matter. We remain firm in our resolve towards Howard Pien Chair realizing our patient-focused Vision. As you would expect, the government’s action, and the significantly more challenging competitive environment, placed a heavy burden on the Group. Our dedication to advancing Indivior’s patient-focused strategy through this period of uncertainty was, however, rewarded in the good strategic progress we saw throughout 2019. As such, and despite the challenges we continue to face, I believe the Group today is better positioned for renewed and sustainable profitable growth in the long-term. While it is clear that our strategic progress has yet to be recognized in the current value of Indivior, the Board continues to be encouraged by the unwavering focus on the Group’s Vision by our workforce. We see evidence of their resilience in their contributions to Indivior that, taken together, have resulted in the solid growth foundation that we are now well placed to leverage moving forward. It is through their outstanding efforts that Indivior is now positioned to make meaningful progress against the long-term net revenue goals we have established for SUBLOCADE® (buprenorphine extended-release) injection CIII and PERSERIS® (risperidone). Of course, we also recognize the Board’s primary duty is to promote the success of the Group. It is for this reason that we continue to protect Indivior’s strong balance sheet to help mitigate the known risks to the Group and also to provide for continued investment behind SUBLOCADE and PERSERIS. This balance and agility will become all-the-more important in 2020 when the revenue contribution from legacy US SUBOXONE® (buprenorphine and naloxone) sublingual film CIII is expected to further diminish towards observed analogues.1 To that end, I am confident in the Board’s ability to help support the business through the transition period it is currently navigating. Below you will find additional reports on key areas of concentration for the Board in 2019. Further developments to Indivior’s robust approach to Integrity and Compliance The Board and the executive management team have worked diligently together to evolve Indivior’s robust approach to Integrity and Compliance to meet current and future needs of the business. We view this area as critical to the Group’s long-term sustainability. Key achievements during the year included the establishment of Centers of Excellence (COE) for Risk Management, Monitoring and Analytics. Including dedicated and expanded resources, this team continued to advance our Risk Assessment & Mitigation Planning process and execute our annual monitoring and reporting program. I am particularly pleased with the refreshed Code of Conduct with associated workforce training. More information is available in the Managing our Business Responsibly section on pages 26 to 29. 1. See following page for footnote Indivior Annual Report 2019 3 Chair’s statement continued “ Ongoing commitment to transparency & shareholder engagement The Board and the Indivior has always had a strong commitment to transparency with its shareholders and other executive management key stakeholders, and I am pleased to report that we continued to uphold this commitment team have worked during a difficult year. The Board was supported in this area by professional advisors and diligently together to external counsel. Further information about the Board’s engagement with shareholders evolve Indivior’s robust can be found on page 60. approach to Integrity Federal Grand Jury Indictment and Compliance to meet current and future needs The current material legal matters which relate to the Group’s activities are detailed on pages 35 to 38 of this report. On April 9, 2019, the U.S. government took action against of the business. Indivior alleging various charges of healthcare fraud, wire fraud, mail fraud, and conspiracy. ” We believe that Indivior has strong defenses against the Government’s charges and we will vigorously defend against these allegations. It is not possible to predict with any certainty the potential impact of this litigation or to quantify the ultimate cost of a verdict or resolution, but it could have a material impact on the Group. The Board recognizes the continuing uncertainty the U.S. government action creates for Indivior’s stakeholders. While Indivior prepares diligently for trial in May 2020, our legal strategy remains unchanged and we remain firmly focused on building on our strategic accomplishments to further Indivior’s Vision that all patients around the world will have access to evidence-based treatment for the chronic conditions and co-occurring disorders of addiction. Changes to the Board Yvonne Greenstreet, Chris Schade and Lizabeth Zlatkus left the Board in 2019 and I would like to thank them for the dedication and commitment to Indivior during their respective tenures. During the year, we welcomed Peter Bains and Graham Hetherington to the Board. Peter and Graham bring significant expertise, each having over three decades of experience in relevant capacities, including strategic, operational and financial leadership across the biotech and specialty pharma industry. Both Peter and Graham share in our patient-focused Vision and see the opportunities Indivior has to address addiction and its co-occuring disorders on a global scale. As a result of these changes, the Board also reviewed the composition of the principal Committees. These changes are discussed in more detail in the Nomination and Governance Committee report on pages 70 to 73. Looking to the future We continue to manage the business challenges ahead and seek to create sustainable long-term value for shareholders and wider stakeholders through unwavering focus on our Mission, Vision and Purpose. I would like to thank all my colleagues at Indivior for their significant efforts and steadfast commitment during a difficult year. I would also like to thank our shareholders for their ongoing and valued support of the Board and the senior management team. Howard Pien Chair 1. IMS Institute Report, January 2016, ‘Price Declines after Branded Medicines Lose Exclusivity in the US’ 4 www.indivior.com “ We continue to manage the business challenges ahead and seek to create sustainable long-term value for shareholders and wider stakeholders through unwavering focus on our Mission, Vision, and Purpose. ” Indivior Annual Report 2019 5 Patient stories Nathalie, 41 years old Inspiring patients “ My recovery is always in jeopardy and it is a constant job to maintain my recovery – but the payoff is amazing. ” Nathalie Patient, US 6 www.indivior.com Strategic report