London listed Pharmaceutical company Indivior has been charged by the USA Federal Prosecutors for using a fraudulent marketing scheme to boost its prescription of its Suboxone Film, an opioid addiction treatment prescription. This has plummeted the shares of the company by three quarters and is close to the lowest stock price market has witnessed in its 52 weeks history.
The indictment was filed by Grand Jury in Virginia for a number of charges related to its fraud scheme that consists of call fraud, mail fraud, and healthcare fraud. According to the Jury, Invidior set up a telephone and online programs to connect the users to doctor who prescribed Suboxone film. They stated that they did in a “careless and clinically unwarranted manner.”
The US Justice Department took the charges in a more vulnerable way as many of the citizens have filed thousands of lawsuits against the opioid manufacturers and distributors. Department of Justice has demanded at least $3 Billion from the company. Looking towards the company’s equity value[$348M] and net cash[$681M], Analysts warns that the company can go out of business.
The Suboxone Film revenue has skyrocketed to billions of dollars. Indivior has used false means and told the customers that is a safer and less abusable option as compared to other drugs available in the market. They have also deceived various health care providers and benefits programmes to propel their sales.
The company commented over the issue. Indiviors spokesperson said that all the indictments are “wrong” and based on “almost exclusively on years-old events from before Indivior became an independent company in 2014”. Howard Pien, Chairman of the company said that his board of members has “investigated the department’s allegations for several years, and the board believes they are flat wrong”.
Jesse Panuccio, Deputy principal associate attorney-general at the Department of Justice said,” The Department of Justice intends to hold accountable those who are in position to know the harm opioid abuse inflicts, but instead choose to profit legally from the pain of the others”.
The opioid treatment drug Suboxone Film was created in 2007 just before the patent of the tablet form expires. DoJ has announced a “discontinue” on the drug supply as it can create a potential effect on children and claims that the drug is not safe.
Just before the accusation, Indivior has put down $438 Million to cover legal matters, most of which is related to the current case.”The department has apparently decided it would rather pursue self-serving headlines on a matter of national significance than achieve an appropriate resolution,” the company said. Previously, the company was owned by Reckitt Benckiser Group PLC.