London Stock Exchange has witnessed a growing trend of companies abandoning their listings, with drugmaker Indivior being the latest to join this exodus. The Virginia-based company, known for its opioid addiction treatments, has decided to cancel its secondary listing in London after shifting its primary listing to the US last year. This move puts additional pressure on the LSE to revitalize its appeal to companies.
Indivior cited various factors for its decision, including the higher liquidity and trading volumes of its shares on the US’s Nasdaq exchange, the geographical distribution of its shareholders, and the cost and administrative burdens associated with maintaining a listing in London. Over 80% of Indivior’s revenues come from the US, a market grappling with a long-standing opioid crisis that has led to a surge in addiction rates and fatal overdoses.
David Wheadon, the chair of Indivior, emphasized that a single primary listing on Nasdaq aligns better with the company’s business profile. The announcement of Indivior’s exit caused its London-listed share price to drop by 2% on Monday, reflecting the market’s response to this development.
The London Stock Exchange has been facing challenges as several companies, including Tui, have opted to transfer their primary listings elsewhere. In the past year, the LSE saw 88 companies delist or move their listings, marking the highest exodus since the 2009 financial crisis. However, there have been positive moments, such as Canal+’s float, which provided a much-needed boost to the London market.
Despite the setbacks, the LSE recently welcomed Valterra, an $11bn platinum spin-off from Anglo American, which obtained a London listing in addition to its existing listing in South Africa. Analysts note that Indivior’s departure was expected given its US-focused operations and shareholder base, with the company initially listed in London following its spin-off from Reckitt Benckiser in 2014.
Indivior appointed Joseph Ciaffoni as its new chief executive in February as part of its strategic realignment. The company’s revenue growth last year was mainly driven by Sublocade, a monthly prescription medicine for opioid addiction treatment, and Suboxone. However, challenges lie ahead, with Suboxone facing intense competition from generic drugs, leading to an anticipated decline in sales.
Legal troubles have also plagued Indivior, with lawsuits alleging false marketing practices and fraudulent claims regarding the safety of its drugs. The company has faced legal actions in both the UK and the US, with past settlements and ongoing litigations adding to its operational complexities.
As the London Stock Exchange navigates through this period of transition and company exits, the focus remains on attracting new listings and retaining existing ones to maintain its position as a key player in the global financial markets.
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