Drugmaker Shire delivers earnings beat amid deal-making push

LONDON (Reuters) - Drugmaker Shire SHP.L reported better-than-expected profit in the last quarter of 2015, a period when management could have been distracted by buying rare disease specialist Dyax and the final stages of its $32 billion pursuit of Baxalta International.

A sign sits in front of Shire's manufacturing facility in Lexington, Massachusetts July 18, 2014. REUTERS/Brian Snyder

Shares in the London-listed company reversed early losses on Thursday to trade up 0.7 percent at 9.57 a.m. ET after it comfortably beat forecasts, helped by higher sales of its ADHD drug Vyvanse and Firazyr, a treatment for hereditary angioedema.

Chief Executive Flemming Ornskov said 2015 started and ended with two important deals in rare diseases -- NPS Pharma and Dyax -- before he secured the transformative merger with Baxalta BXLT.N last month.

“The integration is progressing very well, and we are on track for a mid-this-year close,” he said.

Baxalta, which makes drugs for rare blood conditions, cancers and immune system disorders, is Shire’s biggest acquisition to date, and Ornskov said it would make the group a leader in rare diseases and propel annual sales to more than $20 billion by 2020.

Forecasts for 2016 will be revised after the Baxalta deal is formally concluded. For Shire as a standalone business, Ornskov said he expected double-digit top-line growth and a 7 to 10 percent increase in earnings.

He said 2016 would be a year of product investment, such as the planned launch of lifitegrast, a potential blockbuster for dry-eye disease, and 14 drugs either in or due to start final-stage clinical trials.

“This is a year when we really have significant investments, but still we think we are in line with people’s expectations, on not only delivering strong top line double-digit growth but keeping a strong eye on profitability,” he said.

Analyst at Jefferies said the company had delivered solid results, with 2016 outlook broadly in line with consensus.

For the fourth quarter, Shire reported non-GAAP earnings per share of $2.97 on revenue up 9 percent to $1.72 billion, both beating analysts’ consensus of $2.87 and $1.70 billion, respectively.

Editing by Sarah Young