Shire is riding solo after AbbVie called it quits on its proposed $52 billion acquisition, but the company isn’t shedding too many tears. The Dublin-based drugmaker announced third-quarter earnings that beat analysts’ expectations, leaving the door open for success post-AbbVie.
Revenue for the quarter increased 32% to $1.59 million and profit rang in at $2.93 per American Depositary Share (ADS), beating the average analyst estimate of $2.49–a gift Shire hopes will keep on giving. The company expects adjusted earnings per ADS to increase at a rate in the high 30% range, the Irish drugmaker said in a statement.
Shire also raked in $1.552 million in product sales during the quarter–a 33% jump over the previous year. The drugmaker pointed to its $4.2 billion acquisition of ViroPharma in 2013 as one of the main drivers of sales, as well as the strong performance of its bestselling products. Blockbuster drug Vyvanse’s sales shot up by 19% in the third quarter to $354.9 million, and ulcerative colitis med Lialda/Mezavant raked in $176.6 million, a 24% leap year over year.
The promising numbers come at a critical moment for Shire, as the company moves forward after its failed deal with Illinois-based AbbVie. AbbVie called off the pending merger in light of new guidelines making it more difficult for companies to shift their domicile abroad for tax-paying purposes and agreed to pay a $1.64 billion breakup fee to Shire–the biggest such fee on record.
Now, with a generous parting gift and strong sales in tow, Shire plans to pick up where it left off pre-AbbVie. CEO Flemming Ornskov chalked up at least 6 acquisitions since taking the reins of the company, and the drugmaker hopes to capitalize on the success of its rare-disease portfolio and top-selling drugs to carry it forward.
“Shire is well-positioned for future growth as we implement our plan to double product sales to $10 billion by 2020. I am confident that Shire, as an independent company, will deliver long-term value to our shareholders and improved outcomes for patients,” Chairman Susan Kilsby said in the company’s earnings statement.
Meanwhile, other Big Pharma players could be chomping at the bit now that the drugmaker is back on the market. A rep from hedge fund Paulson & Co. called Allergan last week and urged its CEO, David Pyott, to consider making a bid for the newly single Shire, sources told The New York Times earlier this week. Bristol-Myers Squibb could also emerge as a potential suitor, wooing the company with a strong immunology program and relatively low debt position, TheStreet’s Richard Saintvilius said.
By Emily Wasserman