Indivior (LON: INDV) course crashes 70 percent after allegations of fraud marketing of Suboxone Film

Stocks in the FTSE 250-listed drug company Indivior crashed 70 percent this morning after it was hit with an American charge containing 28 felony counters last night.

Its shares were down 70 percent at 31 p this morning. [19659002] Reckitt Benckiser, the former parent company, saw its shares slip six percent to 6.014p.

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Indivior has been accused of engaging in a fraudulent marketing scheme to increase the prescriptions of its Suboxone Film product used to treat opioid dependence.

A federal jury in Virginia issued the accusation yesterday in connection with the federal criminal investigation initiated by the US Department of Justice in December 201[ads1]3.

The charge contains 28 felony counters including one number of conspiracies to commit e-mail, management and health scams; a count of health care scams; four counts of email scams; and twenty-four counts of fraud.

In a statement to the stock market tomorrow, the company said that the claims are "based on actions that occurred almost exclusively before Indivior became an independent company in its demerger from Reckitt Benckiser Group at the end of 2014."

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It said it believes the claims are "not supported by the facts and the law" and said "important claims have been contradicted by the US government's scientific agencies" , the Food and Drug Administration and the Centers for Disease Control. "

Indivior warns that an unfavorable judgment in the case could "have a material adverse effect on the company and its financial position and views".

The company's stock price has been hammering over the past year, as it is struggling to maintain the advantage of its Suboxone Film fabric on the important US market. [19659002] A year ago, the stock traded over 400p, but increased competition from generic drug producers into the market and a number of legal arrangements in trying to keep them out have led to a damaging stock price.

Reckitt Benckiser issued a statement to the stock exchange who said: "This charge is not against RB Group or any other group company."

The company said that in the annual report it had recognized a provision of $ 400 million (£ 313m).