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How a Biotech Turned a Bust Into a Hit

The promise seemed huge. In 2005 a Boston biotech, Alkermes (ALKS), developed a drug to fight addiction. Injected once a month, Vivitrol blocks brain receptors and prevents addicts from getting high. The FDA initially approved it to treat alcoholism. Sure, it was pricey—$1,100 a month—but it worked. Alkermes licensed the medication to an outside company, which enlisted 250 salespeople to push it to doctors.

Sales flopped, and Richard Pops, Alkermes’s CEO, decided to end the licensing deal and have Alkermes sell the drug itself. Still, even after the FDA approved Vivitrol to fight opioid addiction in 2010, sales lagged. Analysts pushed Pops to drop the drug. He refused.

Opioid use was surging, and when a Massachusetts sheriff inquired about using it to treat repeat drug offenders instead of imprisoning them, Pops modified his approach again. He decided to send his reps into the heart of the justice system. Alkermes sought out the police, judges, parole officers, and social services officials who preferred treatment rather than incarceration. Alkermes connected police to doctors, handled reimbursement, and provided education and better access to the medication. (Addicts now get their first shot free.)

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Word of mouth spread, and 250 pilot programs launched nationwide, com­bining the injections with therapy and social services support. They were fueled by success stories like those in Hocking County, Ohio, where a drug court helped 90 people kick their addictions and get jobs. Ohio officials are considering replicating the program statewide.

Vivitrol now makes up one-quarter of Alkermes’s $628 million in annual revenues. The company is still losing money, but Vivitrol’s growth has boosted expectations. Says Jefferies analyst Biren Amin: “It definitely paid off.”

A version of this article appears in the October 1, 2016 issue of Fortune.