Shire has posted lower-than-expected sales for the first quarter, although its attention-deficit hyperactivity disorder treatments once again performed well.
Net income sank to $64.8 million from $238.4 million in the like, year-earlier period, as a result of an impairment charge for goodwill ($199 million) relating to Shire’s regenerative medicine business. Revenues slipped 0.9% to $1.16 billion.
Turnover was driven by the ADHD drug Vyvanse (lisdexamfetamine dimesylate), which climbed 15% to $298.4 million. That figure will rise in future quarters given that the US Food and Drug Administration has just expanded approval on Vyvanse, making it the first stimulant medication to get the green light for maintenance treatment in patients aged six and above with ADHD.
Sales of its off-patent predecessor Adderall XR (mixed amphetamine salts) fell 10% to $99.8 million, while another ADHD drug, Intuniv (guanfacine), had sales of $77.7 million (+13%). As for Shire’s rare diseases portfolio, eyebrows were raised as sales of Replagal (agalsidase alfa) for Fabry disease fell 15% to $114.0 million.
Replagal, Dermagraft decline
The company said that the fall was due to ordering patterns in Latin America and competition in Europe from Sanofi-owned Genzyme’s Fabrazyme (agalsidase beta) which has fixed its manufacturing problems.
Vpriv (velaglucerase alfa) for Gaucher’s disease brought in $81.6 million, up 14%, while the Hunter Syndrome therapy Elaprase (idursulfase) slipped 9% to $114.3 million. As for Shire’s other products, Pentasa (mesalamine) was up 8% to $71.0 million, and the firm’s newer ulcerative colitis drug Lialda/Mezavant brought in $100.5 million, an increase of 5%.
Dermagraft, a regenerative bio-engineered skin substitute for the treatment of diabetic foot ulcers, also disappointed, with sales crashing 62% to $18.5 million. Shire said that “whilst our future expectations for long term growth of Dermagraft have been revised downwards, we still expect the product to return to growth over coming quarters”. On a positive note, Firazyr (icatibant injection) for hereditary angioedema, had sales of $41.7 million, a leap of 12%.
New CEO, new structure
The results marked the debut of new chief executive Flemming Ornskov who unveiled his plans for future growth. First up, he announced the introduction of a “flatter and more scalable structure” consisting of “five commercially focused business units” – rare diseases, neuroscience, gastrointestinal, regenerative medicine and internal medicine – along with “a single R&D organisation”.
In the first quarter, Shire made three acquisitions – Lotus Tissue Repair, Premacure and SARcode BioSciences, and Dr Ornskov noted that the last two “provide us with the foundation to build a potential new business unit in ophthalmology – a growing market”. A pipeline review is under way and already two studies have been stopped.
Vyvanse schizophrenia trial cancelled
The company noted that a Phase III programme looking at Vyvanse for the treatment of negative symptoms of schizophrenia has been cancelled “after a review and prioritisation of Shire’s development portfolio and taking into account investment requirements for recent acquisitions”. Also, following analysis of toxicology studies, it has discontinued development of HGT4510 for Duchenne muscular dystrophy and returned rights to Acceleron Pharma.
Dr Ornskov added that “we also aim to focus our business development on acquiring later stage assets and to grow our sales in Latin America and Asia”. Plans are underway for “more focused growth” in Japan and Brazil, while Shire said that “China has also been identified as a priority”.
Investors were taken aback a little by the results and Shire shares ended the day down 2.6% at £19.68.
