First Quarter Results to March 31, Shire plc April 25, 2007

Transcription

1 First Quarter Results to March 31, 2007 Shire plc April 25, 2007

2 THE SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 Statements included herein that are not historical facts are forward-looking statements. Such forward-looking statements involve a number of risks and uncertainties and are subject to change at any time. In the event such risks or uncertainties materialize, Shire s results could be materially affected. The risks and uncertainties include, but are not limited to, risks associated with: the inherent uncertainty of pharmaceutical research, product development, manufacturing and commercialization; the impact of competitive products, including, but not limited to the impact of those on Shire s Attention Deficit and Hyperactivity Disorder (ADHD) franchise; patents, including but not limited to, legal challenges relating to Shire s ADHD franchise; government regulation and approval, including but not limited to the expected product approval dates of SPD503 (guanfacine extended release) (ADHD) and SPD465 (extended release triple-bead mixed amphetamine salts) (ADHD); Shire s ability to secure new products for commercialization and/or development; Shire s ability to benefit from its acquisition of New River Pharmaceuticals Inc.; and other risks and uncertainties detailed from time to time in Shire plc s filings with the Securities and Exchange Commission, particularly Shire plc s Annual Report on Form 10-K for the year ended December 31,

3 Agenda Introduction and Q1 Highlights Q1 Financial Review Product Launches Conclusion Questions & Answers Matthew Emmens Angus Russell Matthew Emmens Matthew Emmens All 3

4 Matthew Emmens CEO Introduction and Q1 Highlights

5 Q Financial Highlights Product sales up 33% to $462 million Total revenues up 29% to $528 million EPS ADS (diluted) GAAP up 78% Non GAAP* up 39% 64 cents 75 cents * This is a non GAAP financial measure which excludes intangible asset amortization charges, the accounting impact of share-based compensation and the effect of certain cash and non-cash items, both recurring and non-recurring, that Shire's management believes are not related to the core performance of Shire s business. 5

6 A series of transactions and approvals has created a solid foundation for the future and transformed Shire TKT acquisition diversified our portfolio and moved Shire into high-value, niche, biologic products with long exclusivity Early stage TKT/HGT pipeline should drive significant growth in 2013 and beyond Barr settlement created more certainty for our ADHD franchise Recent product approvals and lifecycle extensions fuel strong growth going forward Acquisition of New River underpins our ADHD franchise long-term The ownership of the patented CARRIERWAVE platform technology may lead to other pharmaceutical applications 6

7 Q Highlights - Executing on Strategy New River Acquisition Completed April 19 ADHD VYVANSE FDA paediatric approval on February 23 ADDERALL XR Marketing license application for adult indication granted by Health Canada DAYTRANA Strong launch continues GI LIALDA Launched on March 19 Very positive reaction from patients and physicians Latest market share 1.2% of TRx and 3.2% of NRx 7

8 Q Highlights - Executing on Strategy Renal FOSRENOL launched in 6 more countries in 2007 including the UK 19 countries in total Authorization to launch received in Italy DYNEPO Launched in Germany in March Human Genetic Therapies ELAPRASE US and European launches in progress 291 patients globally on therapy by March 31 REPLAGAL Launched in Japan on February 15 GA-GCB Phase 3 clinical program has begun with first patients dosed in February 8

9 2007 Newsflow VYVANSE launch planned for June snda for adult indication to be filed with FDA in Q2 SPD503 paediatric non-stimulant PDUFA June 24 SPD465 long-acting stimulant for adults PDUFA May 21 DAYTRANA EU filing in H2 9

10 Shire has one of the strongest late-stage pipelines in the Specialty Pharma sector New Product Launch VYVANSE DYNEPO SPD503 LIALDA / SPD465* MEZAVANT GA-GCB Sanfilippo MLD CEPO SPD493 Label Expansion FOSRENOL -CKD ELAPRASE CNS Expanding Geographic Reach FOSRENOL EU ELAPRASE EU DAYTRANA Seasonique VYVANSE EU EU Seven potential new product launches over a 30 month period from * Launch timing subject to review 10

11 Angus Russell CFO Q1 Financial Review

12 Total Revenues Q1 07 Q1 06 Growth $m $m % Product Sales % Royalties Other Revenue Q1 07 Q1 06 Growth $m $m % Product Sales 87% % (excl. new launches) DAYTRANA ELAPRASE FOSRENOL EU 13% FOSRENOL US Product Sales 100% % Total Revenues % Total Revenue % (excl. new launches) 12

13 Major Product Sales Q1 07 Q1 06 Sales US RX* $m $m Growth Growth ADDERALL XR % 5% PENTASA % 6% REPLAGAL % n/a ELAPRASE n/a n/a FOSRENOL % 15% CARBATROL % -6% XAGRID** % n/a DAYTRANA n/a n/a * Source: IMS Data ** worldwide sales excluding US and Canada 13

14 Royalties Q1 07 Q1 06 Growth $m $m (%) 3TC % * ZEFFIX % ** Other *** % Total % *Foreign exchange movements have contributed +4% to reported growth **Foreign exchange movements have contributed +11% to reported growth ***Includes REMINYL/RAZADYNE 14

15 Net Income/EPS Q1 07 Q1 06 Growth Net income ($m) (%) - GAAP % - Adjustments Non GAAP (1) % EPS - ADS (diluted) - GAAP 63.9c 36.0c 78% - Non GAAP (1) 74.7c 53.7c 39% (1) These are non GAAP financial measures. They exclude intangible asset amortization charges, the accounting impact of share-based compensation and the effect of certain cash and non-cash items, both recurring and non-recurring, that Shire's management believes are not related to the core performance of Shire s business. 15

16 EPS Reconciliation Q1 07 Q1 07 Q1 06 Q1 06 $m cents/ads $m cents/ads Net income for diluted EPS (ADS) c c Cost of product sales fair value adjustment c New River milestone payment c Integration costs c Amortization c c SFAS 123R effect c c Taxes on above adjustments (7.0) (3.9c) (27.6) (16.2c) Gain on disposition of discontinued operations - - (40.6) (24.0c) Net income for non GAAP EPS (ADS) (Ex SFAS 123R and amortization) c c 16

17 Financial Ratios (on a non-gaap basis) Q1 07 Q1 06 FY 06 COGS : Product sales 14% 11% 13% Gross margin 86% 89% 87% R&D : Revenues 15% 18% 17% SG&A (excl. D&A) : Product sales 45% 51% 52% EBITDA margin 34% 30% 28% This slide contains non GAAP financial measures. They exclude intangible asset amortization charges, the accounting impact of share-based compensation and the effect of certain cash and non-cash items, both recurring and non-recurring, that Shire's management believes are not related to the core performance of Shire s business. 17

18 Cash flow YTD 2007 Millions of USD Cash generation Net tax/interest -28 Asset sales Product milestones + 8 Fixed asset purchases Share issue Option/Warrant exercises New River acquisition/funding costs paid Treasury stock purchases + 29 Cash surplus for YTD 2007 : +919 Net Cash at ,157 Cash Surplus Q Net Cash at ,076 Provision for amounts due (459) for appraisal rights Restricted cash (30) Free Cash 1,587 New facilities 2,300 Liquidity at ,887 Less New River Payments (2,600) (approx) Revised liquidity 1,287 18

19 Q Actual v 2007 Guidance (including NRP) Q1 07 Original Updated Actual FY Guidance FY Guidance Revenue growth 29% Around 20% Low 20% range Revenue growth (excl. launches) 16% R&D - GAAP ($m) 80.8 Less SFAS 123R (2.3) R&D - Non GAAP ($m) 78.5 $360m to $380m $340m to $360m SG&A - GAAP ($m) Less SFAS 123R (7.5) SG&A - Non GAAP ($m) $930m to $960m Unchanged D&A - GAAP ($m) 28.9 Less amortization (15.3) Up 20% approx $70m Up 80% approx $100m Depn - Non GAAP ($m) 13.6 Up 20% approx. $50m Unchanged Tax rate 27% 26% Unchanged New River Integration costs - n/a $10m (to be non GAAPed) 19

20 Matthew Emmens CEO Product Launches

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22 VYVANSE Next generation of ADHD treatment VYVANSE - innovative and future flagship product for ADHD Impressive efficacy, extended duration, less potential for abuse Strong IP until 2024 FDA approval received on February 23, 2007 Awaiting final DEA scheduling Launch in June is optimal snda for adult indication expected to be filed in Q

23 Most Parents Report that their Child s ADHD Medication Wears Off before 6 PM Harris Interactive Omnibus Survey 389 parents surveyed about their child who is currently taking a oncedaily ADHD medication in the morning Conducted October 2006 Results 53% report that their child s ADHD medication stops working before 6PM 63% report their child s once-daily stimulant medication works 11 hours or less 23

24 VYVANSE provides efficacy throughout the day Change in Score at Endpoint From Baseline on Conners Parent Rating Scale (CPRS) Across the Day % Change ~10 AM ~2 PM ~6 PM * -51.8* VYVANSE Placebo -48.2* Median daily dosing time was between 7:30 AM and 8 AM. The CPRS was used to assess the duration of therapeutic response in 285 patients by separately analyzing the assessments performed per protocol in the morning (~10 AM), afternoon (~2 PM), and evening (~6 PM). *P<.0001 vs placebo. Adapted from Biederman, et al, Clinical Therapeutics, March

25 Consistency/Reliability are the most important Attributes of an ADHD medication Quantitative Research w/750 High Rxers of ADHD medications: Physicians need for the therapy they prescribe to work the first time. They do not like to prescribe again and when they do, they have to explain why their first choice did not work. Physicians want to have their first prescription work with every patient, the same way, every time and for the long term. Brain Surgery quantitative study, January

26 VYVANSE appears to have less variability in drug delivery than ADDERALL XR VYVANSE 70 mg (n=8) (d-amphetamine) ADDERALL XR 30 mg (n=9) (total amphetamine) Concentration ( (ng/ml ng/ml) Time (h) to Maximum Concentration (Tmax( Tmax) Steady-state pharmacokinetics in pediatric patients (ages 6 to 12) in a randomized, 3-way crossover, double-blind study that included VYVANSE, ADDERALL XR, and placebo. Data on file, LDX005. Shire US Inc. 26

27 74% of Patients Taking VYVANSE Were Much/Very Much Improved (CGI-I) % of Subjects Much/Very Much Improved Much improved 18% Very much improved 72%* 74%* 0 Placebo ADDERALL XR VYVANSE 32% of patients taking VYVANSE responded as very much improved *P< CGI-I=Clinical Global Impressions-Improvement (ITT Analysis) Data on file, LDX 003. Shire US Inc. 27

28 VYVANSE Market Research Over 1,600 high prescribing physicians have participated in 11 market research projects since January 2006 In the most recent study that included 200 physicians, 3/4ths said they were likely/very likely to prescribe VYVANSE and less than 8% said that they are not likely to prescribe it. Based on another study with 200 physicians, 93% said they would prescribe VYVANSE. Over 400 consumers have participated in 5 research projects since October 2006 In one study of 160 caregivers, over 100 had a positive impression of VYVANSE s product profile relative to the ADHD medication their child is currently taking. The attraction to VYVANSE is driven by its effectiveness until 6 PM In another study of 100 caregivers, 92% stated they liked the medication; 88% stated that they are likely or very likely to ask their physicians about VYVANSE. 28

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30 LIALDA Impressive Efficacy from a Novel QD Formulation As the only once daily oral 5-ASA proven to control symptoms and induce remission, LIALDA helps patients overcome the disruption of UC LIALDA induces remission as measured by stringent clinical and endoscopic endpoints LIALDA utilizes MMXTM (Multi-matrix) technology to delay initial release of mesalamine to the terminal ileum and ensure that mesalamine is released throughout the colon with just one daily dose. LIALDA simplifies the route to remission with just two to four tablets taken once a day 30

31 Profile of LIALDA Attractive to GEs and Patients GEs rate LIALDA more favorably for UC than Colazal, Asacol or Remicade 98% of GEs reported they intended to prescribe LIALDA for at least one patient GEs intend to prescribe LIALDA for new starts, patients in flare and patients in remission 55% of patients report they prefer the profile of LIALDA to that of their current medication 66% of patients who knew about LIALDA reported that they would ask their doctor to prescribe it MCO Pharmacy Directors were more concerned about budget impact from biologics (Remicade, Humira) than the impact from 5-ASA Survey of 120 GEs, 25 MCO Pharmacy Directors and 160 UC patients 31

32 Launch Progress Field promotion by 120 reps targeting 8,925 GI physicians began March 19 Shire call activity increased 37% from pre-launch to launch Shire stocked 26,000 pharmacies with LIALDA prior to launch Shire has trained a sufficient amount of speakers on the LIALDA data and are available to conduct speaker programs Branded Direct to Patient campaign planned to commence in May Latest prescription data: NRx 3.2% and TRx 1.2% share of the branded oral mesalamine market. 32

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34 Global FOSRENOL Launch Trajectories 20% 18% 16% Estimated Share of ESRD Patients 14% 12% 10% 8% 6% 4% 2% Sweden Actual Germany Actual US Actual France Actual 0%

35 Concluding Remarks

36 Concluding Remarks Excellent results the business continues to perform strongly Successful launches in 2006 and Q with upgraded guidance for full year Continuing to demonstrate our ability to execute ADDERALL XR leading US market share DAYTRANA - strong launch continues ELAPRASE rapid launch in US and EU LIALDA approved and launched in Q1 2007, quick uptake FOSRENOL - strong start in Europe, US position improving DYNEPO launched in Q1 2007, good reception VYVANSE to launch in the US by mid-2007 Early stage pipeline advancing toward clinical development Shire will continue to evolve in order to maintain its long-term growth 36

37 Questions and Answers All

38 APPENDIX

39 Appendix Non GAAP net income - revised basis 2006 Q1 Q2 Q3 Q4 FY $m $m $m $m $m Net income for diluted EPS (ADS) New River milestone payments Cost of product sales fair value adjustment Upfront license payments (Duramed and Warren) Integration costs Gain on sale of product rights - - (63.0) - (63.0) Taxes on above adjustments (21.3) (5.1) 7.1 (0.5) (18.8) Gain on disposition of discontinued operations (40.6) (40.6) Net income for non GAAP diluted EPS (ADS) (1) FAS 123R effect Intangible asset amortization Taxes on above adjustments (6.3) (5.9) (6.6) (8.8) (26.9) Net income for non GAAP diluted EPS (ADS) (2) (1) 2006 Non GAAP basis (2) Revised Non GAAP using 2007 basis

40 Appendix Non GAAP diluted EPS - revised basis 2006 Q1 Q2 Q3 Q4 FY cents/ads cents/ads cents/ads cents/ads cents/ads (3) Diluted EPS (ADS) 36.0c 36.1c 51.3c 40.2c 163.8c New River milestone payments 29.4c c Cost of product sales fair value adjustment 13.8c 9.9c 3.9c c Upfront license payments (Duramed and Warren) c c Integration costs 1.5c 0.9c - 0.9c 3.3c Gain on sale of product rights - - (37.2c) - (37.2c) Taxes on above adjustments (12.6c) (3.0c) 4.2c (0.3c) (11.1c) Gain on disposition of discontinued operations (24.0c) (24.0c) Non GAAP EPS (ADS) (1) 44.1c 43.9c 40.2c 40.8c 170.1c FAS 123R effect 5.4c 4.4c 5.2c 10.0c 24.9c Intangible asset amortization 7.8c 7.8c 8.7c 9.3c 33.6c Taxes on above adjustments (3.6c) (3.3c) (3.9c) (5.1c) (15.6c) Non GAAP EPS (ADS) (2) 53.7c 52.8c 50.2c 55.0c 213.0c (1) 2006 Non GAAP basis (2) Revised Non GAAP using 2007 basis (3) Full year numbers do not equate to the sum of the quarters due to the change in denominator each quarter. 40