Shire hands its investors a tonic

12 April 2012

SHIRE Pharmaceuticals, the Footsie-listed group that stunned the City with a profits warning two months ago, has given its investors a tonic, beating forecasts for first-quarter earnings and saying full-year profits may grow after all.

The firm said it was overcoming generic competition to its hyperactivity drug Adderall by switching patients to a new patent-protected, once-daily version called Adderall XR. 'The switch is the best on record,' chief executive Rolf Stahel said. 'I am confident Adderall XR will be a bigger product in monetary terms than Adderall ever was.'

The shares were ahead 30 1/2p at 539 1/2p by early afternoon. They lost more than a third of their value after Shire warned in February that 2002 earnings might be flat.

Drugmakers are facing threats to blockbuster medicines as patents expire. AstraZeneca s fighting in the courts to keep its rights to top-selling ulcer pill Losec. But Shire is more exposed than many, as the Adderall brand accounted for 40% of its $877.6m (£630m) of sales in 2001.

Earnings rose 34% to 11.1 cents a share in the three months ended 31 March, beating analysts' expectations for a figure of around 10 cents.

Sales of the Adderall brand rose 54% to $108m, with Adderall XR accounting for $61.9m. Shire, which also focuses on treatments for cancer and infectious diseases, said total revenue rose 30% to $243.2m in its first quarter.

'For year 2002, Shire is currently on track to deliver total revenue growth in the low to mid teens and earnings per share equivalent to 2001, with the prospect of some earnings growth,' it said..

Stahel said the firm was looking to use its $944m cash pile to make product and project acquisitions, but declined to comment further.

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