Shire’s Adderall Sales Plunge; Shares Gain on Vyvanse Prospects

By Trista Kelley

Aug. 5 (Bloomberg) — Shire Plc’s second-quarter revenue sank 19 percent as generic competition hurt sales of its Adderall hyperactivity pill. The shares gained the most since mid-April on prospects for Adderall’s successor, Vyvanse.

Revenue dropped to $629.7 million from $775.6 million a year earlier, Basingstoke, England-based Shire said in a statement today. Analysts predicted $619.1 million, the average of seven estimates compiled by Bloomberg in the past four weeks.

Shire began trying to switch patients from Adderall to Vyvanse before the older drug faced generic competition in April. Shire is also seeking to expand uses for Vyvanse and today said it started second-phase testing for depression and psychiatric conditions, Chief Executive Officer Angus Russell said. The company is “actively” managing costs to help offset a 77 percent plunge in Adderall sales to $67 million in the quarter, Russell said on a conference call with analysts.

“Shire gave reassurance that Vyvanse is not going to suffer from further generics on Adderall XR and that it will grow strongly in the second half,” which helped boost the shares, Navid Malik, an analyst at Matrix Corporate Capital in London, said in an e-mail.

In March, GlaxoSmithKline Plc agreed that 600 of its salespeople will promote Vyvanse in the U.S. as part of a three- year deal. Vyvanse sales jumped 75 percent to $114 million in the second quarter, missing the $121 million median target of three analysts surveyed by Bloomberg.

‘Larger Benefits’

“Every adult account they’ve targeted, they’ve had an impact,” Russell said. “This agreement is progressive. We expect incremental sales and each year and it will show larger benefits over that timeframe.”

Shire has been relying on its human-genetics unit to ease dependence on products for attention deficit hyperactivity disorder, which account for about half of 2008 revenue. Total sales are forecast to grow in the “mid teens range” on average between 2009 and 2015, helped by the planned introduction of Intuniv for ADHD in the fourth quarter and velaglucerase alfa for Gaucher disease in 2010.

Shire rose 37 pence, or 4.2 percent, to close at 919 pence in London, the steepest one-day gain since April 16. The stock had fallen 13 percent this year before today, hurt by lower- than-predicted Vyvanse sales, giving the company a market value of 4.9 billion pounds ($8.3 billion). The Bloomberg Europe Pharmaceutical Index is little changed.

Net income was $44.1 million, or 24 cents per American depositary share, compared with a loss of $79 million, or 44 cents, a year earlier. Earnings per American depositary share excluding some items were 47 cents based on the company’s full- year expected tax rate, compared with a median estimate of 46 cents from 11 analysts surveyed by Bloomberg.

Shire had a loss last year on costs to license Metazym to treat a rare neurological disease and a writedown on the anemia drug Dynepo.

To contact the reporter on this story: Trista Kelley in London at tkelley2@bloomberg.net

Last Updated: August 5, 2009 12:24 EDT

taken from bloomberg.com 8-5-09