Sector News

Shire CEO happy to fly solo again after AbbVie deal’s collapse

November 11, 2014
Life sciences
Post-Shire-breakup, AbbVie CEO Richard Gonzalez says his company will be scouting about for other “strategic” M&A hookups. But Shire chief Flemming Ornskov isn’t interested in courting another buyer.
 
“I think we now have to focus on being an independent company,” he told Investor’s Business Daily in an interview.
 
Until AbbVie made it an offer it couldn’t refuse, that was always the Irish company’s plan, he said. Ornskov himself had hit the road to talk up the benefits of flying solo, pointing to the company’s plan to achieve $10 billion in annual sales by 2020. He figures Shire could eventually count itself among Big Biotechs the likes of Gilead, Celgene) and Biogen Idec.
 
“AbbVie increased their offer a number of times, and eventually I think the board of Shire felt that the number they were offering was of such a magnitude that they had to recommend it,” he told IBD.
 
But now? “I quickly put the AbbVie situation behind me, and I think so will the team,” he said.
 
That, of course, doesn’t mean Shire won’t be keeping an eye out for pickups of its own. Ornskov says Shire “has always been an acquisitive company,” and it has been particularly active since the Dane took the reins. Shire has made at least 6 deals–excluding the AbbVie merger–during his 18-month tenure.
 
The biggest of those was the $4.5 billion buyout of ViroPharma, and industry watchers can look to that deal for clues to Shire’s future. In that transaction, the company grabbed hereditary angioedema med Cinryze, which complemented its own Firazyr and helped spur growth of that drug–all the while helping Shire expand into the fast-growing rare-disease field and diversify beyond its core ADD business.
 
“That’s a good pattern for us: building on domain expertise we have, making a targeted acquisition, then performing very well with the acquired asset and the spillover effect on our existing asset,” Ornskov told IBD. “We’ll look for opportunities to do that in other areas.”
 
By Carly Helfand
 

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