UPDATE 2-Shire ups 2008 sales outlook, shares at 2-month high

(Adds comments by CEO, analyst)

By Michael Kahn

LONDON, July 31 (Reuters) - Shire Ltd (SHP.L)posted second-quarter results that topped analyst expectations on sales of its older attention deficit disorder (ADHD) drug Adderall XR, and raised its sales forecast for the full year.

Shares of Britain's third-biggest drugmaker rose to a two-month high after the company also backed the 2008 outlook for its new ADHD drug hope Vyvanse, implying stronger growth for the key treatment in the second half of the year.

Shire shares were trading up 4 percent at 836 pence at 1201 GMT on Thursday, having risen as high as 866-1/2p, their highest since late May.

Shire's underlying earnings per share rose to 95 cents from 56 cents a year ago on revenue up 35 percent to $776 million. Adderall XR sales increased 16 percent to $296 million, while Vyvanse revenue came in at $65 million.

This was above the expectations of many analysts, including Jeremy Batstone at Charles Stanley Equity Research who said he had been looking for second-quarter revenue of $680 million and adjusted earnings per share of 80 cents.

"The two main surprises (were) revenue guidance has been upgraded and that Vyvanse was going to come in at the bottom end of the range the company had already given," he said in a telephone interview.

"Given Vyvanse's performance over the second quarter, if they pull it off it will be a heroic performancee."

The company said it now expects 2008 revenue to rise at least 20 percent, up from a previous outlook for growth in the mid to high teens.

Shire backed its earlier sales forecast for Vyvanse to be at the lower end of a range between $350 million and $400 million.

Vyvanse is key to Shire's future as it is hoping to switch patients to it from its current ADHD best-seller, Adderall XR, which could face generic competition from April 2009.

Shire Chief Executive Angus Russell said the company boosted its sales outlook because of a strong performance in the first half of 2008 as well as momentum that will carry through for the remainder of the year.

He added the results were evidence the company's strategy to focus on rare diseases and specialist treatment is the right one, and predicted a lift from the U.S. decision earlier in the year to approve Vyvanse for adults.

"We clearly have a lot of momentum in our new products," Russell told a media conference call. (Reporting by Michael Kahn, Editing by David Holmes)