Dublin-based drug maker Shire plc (SHPG: Quote,SHP.L), Thursday reported a plunge in fourth-quarter profit, hurt by impairment charges related to its chronic constipation drug Resolor, as well as litigation charges. Shire stock lost 7 percent in afternoon trade on the Nasdaq, and ended 5 percent lower in London.
Revenues for the quarter increased from the prior year and were in line with Street expectations. Revenues rose on growth of Vyvanse and Intuniv indicated in the treatment of attention-deficit hyperactivity disorder (ADHD), as well as on Hunter Syndrome drug Elaprase, and gastrointestinal drug Lialda/Mezavant.
Sales of erstwhile key ADHD drug Adderall XR drug slipped, hurt mainly by generic competition. A new competition for the drug emerged, as earlier today, Teva Pharmaceutical Industries Ltd. (TEVA), the world's biggest maker of generic medicines, said it won approval from the U.S. Food and Drug Administration for a version of Adderall XR.
Shire meanwhile said it believes that branded Adderall XR can continue to compete successfully in a generic market. However, the company warned royalties and other revenues for 2013 are expected to be 30 to 40 percent lower, due mainly to the impact of the lower Adderall XR authorized generic royalty rate receivable from Impax, along with generic rivalry and patent expiry on other products.
Shire reported fourth-quarter net income of $42 million or 22.2 cents per American Depositary Share, or ADS. This compares with net income of $255 million of 133.2 cents per ADS last year.
Results for the quarter include impairment charges of $205 million, including $126.7 million charges of intellectual property rights acquired for Resolor in the EU. Other items included litigation charges of $49 million.
Excluding items, adjusted earnings for the quarter were 157.8 cents per ADS, compared with 151.2 cents per ADS a year ago.
On average, 10 analysts polled by Thomson Reuters expected earnings of $1.58 ADS for the quarter. Analysts' estimates typically exclude special items.
Revenues for the quarter totaled $1.20 billion, compared with $1.14 billion in the prior year. Analysts on consensus estimated revenues of $1.20 billion for the quarter.
Sales of Adderall XR slid 35 percent to $82 million, while Vyvanse gained 18 percent to $256.5 million. Sales of ADHD drug Intuniv rose 24 percent to $81 million.
The company expects financial results to show further growth in line with current consensus earnings expectations for 2013, based on the estimates compiled by Consensus Forecast Ltd. of $6.72 non-GAAP earnings per ADS for fiscal year 2013.
Shire is trading at $93.62, down 6.73%, on a volume of 0.6 million shares. In London, the stock closed at 2,027.00 pence, down 5.50%, on a volume of 4.7 million shares.
 | | To receive FREE breaking news email alerts for Shire plc and others in your portfolio |
|
by RTT Staff Writer
For comments and feedback: editorial@rttnews.com
Business News