* Lifts full-year earnings growth target to double digit
* Q2 earnings/ADS up 6 pct to $1.79 vs f'cast $1.66
* Revenue $1.27 billion, up 6 percent, vs f'cast $1.22 bln
* Shares up 5.1 percent, hit record high
(Adds CEO comments, analyst reaction)
By Paul Sandle
LONDON, July 25 British drugmaker Shire Plc
raised its earnings outlook after product sales
rebounded in the second quarter, marking the success of its
efforts to reap profits from its specialist drug portfolio.
Its shares jumped to a record high and were up 5.1 percent
at 2,330 pence by 1411 GMT on Thursday, topping the gainers list
in the FTSE 100 blue-chip stock index.
"We are sharpening our focus on commercial execution," said
Chief Executive Flemming Ornskov, noting the company's strategy
was paying off in better sales for hyperactivity drugs Vyvanse
and Intuniv, up to $300 million and $90 million respectively.
The results were also boosted by sales of Shire's Lialda
treatment for ulcerative colitis, which generated sales of $138
million, up 46 percent, Ornskov added.
Having missed market sales forecasts in May, Shire has
returned to higher growth and now expected earnings to increase
by a double-digit rate in 2013.
It was also helped by its older Adderall XR hyperactivity
product, which for the past year has faced generic competition
but whose impact has not been as damaging as some expected.
Sales fell 16 percent to $112.3 million against a forecast $88
Shire posted earnings per American Depositary Share (ADS) of
$1.79, on a non-GAAP basis, compared with the $1.66 forecast by
analysts in a company-supplied poll.
Revenue of $1.27 billion was up 6 percent, beating the $1.22
billion the market expected.
"After a strong recent run-up in the shares, there was
little scope for disappointment in these figures and they have
not disappointed," analysts at Deutsche Bank said.
The change in guidance to "double digit growth" from it
previous guidance of "in line with consensus", implied modest
upgrades to forecasts, they said. Average estimates stand at
$6.68, representing 10 percent growth.
As well as treatments for hyperactivity, London-listed Shire
also focuses on drugs for treating rare diseases.
Ornskov, who took over in May, is reorganising Shire into
five divisions - rare diseases, neuroscience, gastrointestinal,
regenerative medicine and internal medicine - and scaling back
Analysts expect generic competition to crimp growth of
Adderall XR for the next couple of years. Dermagraft, a
treatment for diabetes-related ulcers, has also been
disappointing to date.
But further out there are hopes for new products coming
through the pipeline - notably Lifitegrast for dry eye - and
Shire is expected to continue its strategy of making bolt-on
acquisitions in key therapeutic areas.
Ornskov said the strength of group's pipeline - with nine
products in late-stage Phase III trials and six in Phase II -
meant it could be selective about acquisitions.
"In rare disease we think there's significant growth
opportunities, so that's one area we are looking," he said.
(Additional reporting by Ben Hirschler; Editing by Stephen
Nisbet and David Holmes)