Market Report: Film has bad ending for Reckitt Benckiser

A decision by America's largest pharmacy group dispensed a large dose of panic yesterday to shareholders in the consumer goods group Reckitt Benckiser.

CVS Caremark, the largest American pharmacy in terms of prescriptions filled, has removed one of Reckitt's drugs from its approved list of medications.

Reckitt has already faced issues with its heroin replacement drug, Suboxone. The drug has moved to a generic status, which means other companies can now make their own versions. Reckitt has argued that the tablet form of the treatment has presented a risk to young children, who were getting hold of the drugs and swallowing them with no knowledge of their nature. It introduced a film version of Suboxone, which it argued was less likely to be used accidentally by children.

But yesterday CVS, which manages drug plans for large corporate employers in America and is estimated to account for 10-20 per cent of the market, removed the film version of Suboxone from its list of medications that are covered by insurance.

CVS has announced that the change will take effect from January 2014, and analysts at Credit Suisse said: "The fear is that others follow suit and Suboxone profits fall sharply." CVS, Credit Suisse added, "clearly appears to have decided that film and tablet are effectively the same product and so is steering its customers to the cheaper version."

The troublesome drug accounts for a fifth of Reckitt's earnings, and its shares collapsed by 252p to 4,677p – the worst faller on the benchmark index.

At the other end of the scale was insurer Resolution. The insurance sector was in demand following news that the reinsurer Swiss Re is in talks to buy the Hugh Osmond-backed Phoenix. Nomura raised Prudential to a buy and Resolution to neutral, and predicted that dividends will grow. Prudential ticked up 8p to 1,118 p and Resolution was up 10.5p to 318.5p.

The blue-chip index clung on to its gains from earlier in the week as the markets digested Wednesday's statement from Ben Bernanke, the US Federal Reserve chief, that quantitative easing is here to stay — for now. The FTSE 100 ticked up just 1.53 points to 6,544.94.

The auto and aerospace engine-maker GKN drove up 8.2p to 334.9p after an announcement that the UK Government and the car industry will each invest £500m over the next ten years to create the "car of the future". The Business Secretary, Vince Cable, announced the investment at the Goodwood Festival of Speed. A group of 27 companies, including GKN, will invest.

On the mid-tier index, Exane BNP Paribas is worried that the shopping centre owner Intu Properties will be hit by more retailers shutting up shop. Exane said punters looking to invest in property companies should focus on residential, which "looks likely to be the strongest market over the next 18 months". It thinks this is a reason to sell Intu and buy the London-focused Capital & Counties because of improving "household finances, mortgage availability and government support".

Intu was demoted from the FTSE 100 in March's rejig, and now Exane prefers its former sister company, which owns significant property in Covent Garden and is developing a residential and mixed-use scheme in Earls Court. It rates Intu a sell at 300p and the company lost 2.9p to close at 328.4p. Capital & Counties got a buy rating with a 415p price target, but punters were yet to be convinced and it edged back 0.1p to 355.5p.

The technology specialist Oxford Instruments enjoyed a 120p rise to 1,370p following a positive update that highlighted growth in nanotechnology.

The AIM-listed payment-processing provider MoneySwap said it had hired a British sales team to sign up UK retailers to accept China UnionPay cards, China's largest bank card. MoneySwap shares put on a 0.15p to finish at 0.85p.

The property consultant Sweett Group has sold its investment in the Leeds social housing project, and it built up a 0.5p gain to 23.5p.

Solar plant investor Bluefield Solar Income Fund made its debut yesterday to raise £150m, and it added 3p to 103p.

Start your day with The Independent, sign up for daily news emails
Life and Style
Fans line up at the AVNs, straining to capture a photo of their favourite star
life Tim Walker asks how much longer it can flesh out an existence
Life and Style
Every minute of every day, Twitter is awash with anger as we seek to let these organisations know precisely what we think of them
techWhen it comes to vitriol, no one on attracts our ire more than big businesses offering bad service
Professor David Nutt wants to change the way gravely ill patients are treated in Britain
people Why does a former Government tsar believe that mind-altering drugs have a place on prescription?
Norway’s ‘The Nordland Line – Minute by Minute, Season by Season’ continues the trend of slow TV
Arts and Entertainment
Jonny Evans has pleaded not guilty to an FA charge for spitting at Papiss Cisse
Life and Style
Kate Moss will make a cameo appearance in David Walliams' The Boy in the Dress
The image released by the Salvation Army, using 'The Dress'
Liverpool defender Kolo Toure
football Defender could make history in the FA Cup, but African Cup of Nations win means he's already content
ebooksA special investigation by Andy McSmith
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Customer Relations Officer

£13000 per annum: Recruitment Genius: This is an exciting opportunity to join ...

Ashdown Group: Junior Application Support Analyst - Fluent German Speaker

£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

Jemma Gent: Project Coordinator

£12 - £15 Hourly Rate: Jemma Gent: In this role you will report to the Head of...

Recruitment Genius: Evening Administrator

£8 per hour: Recruitment Genius: This Pension Specialist was established early...

Day In a Page

Homeless Veterans campaign: Donations hit record-breaking £1m target after £300,000 gift from Lloyds Bank

Homeless Veterans campaign

Donations hit record-breaking £1m target after huge gift from Lloyds Bank
Flight MH370 a year on: Lost without a trace – but the search goes on

Lost without a trace

But, a year on, the search continues for Flight MH370
Germany's spymasters left red-faced after thieves break into brand new secret service HQ and steal taps

Germany's spy HQ springs a leak

Thieves break into new €1.5bn complex... to steal taps
International Women's Day 2015: Celebrating the whirlwind wit of Simone de Beauvoir

Whirlwind wit of Simone de Beauvoir

Simone de Beauvoir's seminal feminist polemic, 'The Second Sex', has been published in short-form for International Women's Day
Mark Zuckerberg’s hiring policy might suit him – but it wouldn’t work for me

Mark Zuckerberg’s hiring policy might suit him – but it wouldn’t work for me

Why would I want to employ someone I’d be happy to have as my boss, asks Simon Kelner
Confessions of a planespotter: With three Britons under arrest in the UAE, the perils have never been more apparent

Confessions of a planespotter

With three Britons under arrest in the UAE, the perils have never been more apparent. Sam Masters explains the appeal
Russia's gulag museum 'makes no mention' of Stalin's atrocities

Russia's gulag museum

Ministry of Culture-run site 'makes no mention' of Stalin's atrocities
The big fresh food con: Alarming truth behind the chocolate muffin that won't decay

The big fresh food con

Joanna Blythman reveals the alarming truth behind the chocolate muffin that won't decay
Virginia Ironside was my landlady: What is it like to live with an agony aunt on call 24/7?

Virginia Ironside was my landlady

Tim Willis reveals what it's like to live with an agony aunt on call 24/7
Paris Fashion Week 2015: The wit and wisdom of Manish Arora's exercise in high camp

Paris Fashion Week 2015

The wit and wisdom of Manish Arora's exercise in high camp
8 best workout DVDs

8 best workout DVDs

If your 'New Year new you' regime hasn’t lasted beyond February, why not try working out from home?
Paul Scholes column: I don't believe Jonny Evans was spitting at Papiss Cissé. It was a reflex. But what the Newcastle striker did next was horrible

Paul Scholes column

I don't believe Evans was spitting at Cissé. It was a reflex. But what the Newcastle striker did next was horrible
Miguel Layun interview: From the Azteca to Vicarage Road with a million followers

From the Azteca to Vicarage Road with a million followers

Miguel Layun is a star in Mexico where he was criticised for leaving to join Watford. But he says he sees the bigger picture
Frank Warren column: Amir Khan ready to meet winner of Floyd Mayweather v Manny Pacquiao

Khan ready to meet winner of Mayweather v Pacquiao

The Bolton fighter is unlikely to take on Kell Brook with two superstar opponents on the horizon, says Frank Warren
War with Isis: Iraq's government fights to win back Tikrit from militants - but then what?

Baghdad fights to win back Tikrit from Isis – but then what?

Patrick Cockburn reports from Kirkuk on a conflict which sectarianism has made intractable