5 Opioid Treatment Stocks

The five opioid treatment stocks are among several companies that have taken their own approach to the growing opioid addiction market in the US, which also happens to be the world’s largest. These companies sell some of the leading opioid addiction treatment drugs, the bulk of which is promoted and financed by the US government.

The US has been struggling with opioid addiction for more than a century, with the first wave hitting between 1870s and 1880s, when the consumption of opiates tripled and affected many demographics, being commonly prescribed for a variety of ailments, such as colds, caughs and lung diseases. Bayer marketed heroin and Mrs Winslow’s Soothing Syrup contained morphine and alcohol and was sold as a medicine to soothe teething babies.

Since the 19th century, the opioid addiction in the US has come in waves, and last year President Trump declared the opioid crisis a “public health emergency”.  The US government estimated that between 2014 and 2016, the number of deaths that involve synthetic opioids has surged by 540%. According to IMS Healthcare, in 2015, drug companies sold around $9.60 billion worth of painkillers, compared to $3.8 billion in 2000. Among the reasons for this growth are the aging population and more cases of diseases that cause chronic pain, such as cancer and diabetes. However, there is also the fact that many painkillers are opioids, which are highly addictive. US Centers for Disease Control and Prevention estimated that in 2015 in a quarter of US counties, opioid prescriptions exceeded one per person. The increase in the consumption of opioids in the US has also led to an increase in the number of deaths from overdose.

The CDC calculated that more than 183,000 people died from an overdose involving a prescription opioid between 1999 and 2015. In 2016, the number of deaths from overdoses amounted to 64,000 people, becoming the leading cause of death for Americans under 50 years old and surpassing the number of deaths caused by HIV at its peak. The agency also estimates that there are over 2.60 million people are addicted to drugs produced from the opium poppy. However, the official figures could be significantly lower compared to the real picture, as they don’t include illegal drugs, such as heroin that people tend to switch to after painkillers.

Many pharmaceutical companies profit from the increase in opioids consumption. Purdue Pharma, which sells OxyContin, has seen the number of prescriptions surge tenfold to over 6.0 million by 2002. Mallinckrodt PLC (NYSE:MNK), which sells Hydrocodone and Oxycodone, saw sales of opioids represent over 5% of its total sales for the first nine months of 2017, although the recent government crackdown saw this figure drop from 8% in the same period of 2016. Depomed Inc (NASDAQ:DEPO) is more reliant on opioid sales, with Nuxynta ER representing 64% of its sales in the first nine months of 2017.

The economic cost of the opioid epidemic in the US is estimated at more than $500 billion, while the National Center for Injury Prevention and Control estimated in 2016 that the cost of treating overdoses, abuse and dependence on prescription opioids racks annual costs of $78.5 billion. In this way, while some pharmaceutical companies are adjusting to the situation and are developing non-opioid drugs for pain relief, a number of pharmaceutical companies are targeting the opioid addiction treatment market.

With this in mind, we have compiled a list of opioid treatment stocks, which are selling various products that have proved themselves as effective in treating opioid addiction.

5. Eli Lilly and Co (NYSE:LLY)

Eli Lilly and Co (NYSE:LLY) is a Fortune 500 company that sells psychiatric medications, such as Prozac, Cymbalta, and Zyprexa. In addition, the company sells Dolophine, a drug commonly known as methadone, which is an opioid used for treatment of heroin addiction. Methadone is marketed under other brands as well, but Eli Lilly and Co (NYSE:LLY) was the first to start distributing it. Methadone doesn’t cure addiction, but works by activating the same parts of the brain as heroin and opium, thus helping reduce cravings and withdrawal symptoms caused by heroin use.

4. Pfizer Inc. (NYSE:PFE)

Pfizer Inc. (NYSE:PFE) is among the companies that sell Naloxone Hydrochloride injections. Naloxone was approved by the FDA in 1971 and is used in cases of drug overdose, often being administered as a first responder drug. Recently, Pfizer Inc. (NYSE:PFE) and other companies that sell Naloxone came under fire from the US Senate over price hikes of Naloxone, but the company also donates up to 250,000 doses a year. Mylan N.V. (NASDAQ:MYL) also launched injectable Naloxone in 2014 and Adapt Pharma is marketing nasal spray formulation of naloxone under the Narcan brand.

3. Reckitt Benckiser Group Plc-ADR (OTCMKTS:RBGLY)

UK-based Reckitt Benckiser Group Plc-ADR (OTCMKTS:RBGLY) is a multinational consumer goods company that sells Buprenorphine under the Suboxone brand, a drug that is used as a maintenance treatment for opioid addiction. Swedish OREXO AB (OTCMKTS:ORXOF) also sells Buprenorphine in combination with Naloxone under the Zubsolv brand.

2. Alkermes Plc (NASDAQ:ALKS)

Alkermes Plc(NASDAQ:ALKS) sells Naltrexone under the brand name Vivitrol. The drug blocks the effect of opioids, but is rather expensive, at $1,300 per shot. In the third quarter of 2017, Alkermes Plc (NASDAQ:ALKS)’s sales of Vivitrol amounted to $69.2 million, up by 24% on the year. Teva Pharmaceutical Industries Ltd (ADR) (NYSE:TEVA) sells an oral version of Naltrexone under the Revia brand.

1. Catalent Inc (NYSE:CTLT)

Last year, Catalent Inc (NYSE:CTLT) partnered with US WorldMeds to manufacture and distribute Lofexidine Hydrochloride in the US. Lofexidine, which in the UK is sold under the BritLofex brand name, is used to alliviate symptoms associated with opioid withdrawal. In November, US WorldMeds got the Priority Review of the NDA for Lofexidine and the Prescription Drug User Fee Act is expected in the second quarter of 2018.

These are opioid treatment stocks that are engaged in selling drugs for various treatments of opioid addiction, from mitigating withdrawal symptoms to blocking the effects of opioids, as well as several companies that manufacture similar products. There are also companies that have analogues to the drugs discussed in this article under development. For example, Biocorrx Inc (OTCMKTS:BICX) and Therakine are working on an injectable naltrexone drug, and Insys Therapeutics Inc (NASDAQ:INSY) is developing a spray formulation of naloxone.

Disclosure: none