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Shire plc Message Board

  • ryan4723 ryan4723 Aug 25, 2006 6:50 PM Flag

    Shire Futures

    I have seen a lot of speculation on these boards in regards to Shire's future not only as an ADHD specialty company, but also its overall direction.

    Although Shire has done very well as of late, climbing above $50, there is much more to come. In October, Shire will receive FDA approval on a once a day mesalamine formulation (to treat ulcerative colitis in the GI market). The current market leaders are dosed 3x per day. This is a billion dollar market. In addition, they are slotted to receive approval on the New River Product in October. Unlike the other amphetamine products, this will be either a Schedule 3 or Schedule 4 drug. This means that it does not have the same abuse potential as the other stimulants. Bottom line? This is the only ADHD treatment that will be able to get refills, get sampled, and get called into pharmacies. Shire made $1B last year on AdderallXR with 25% of the market. This product will easily exceed 35% of the market in 2 years. New River has an option in their contract with Shire to co-promote the product (make 25% of the total sales calls) and thus share in a smaller % of the revenue if they wish. New River sees the value in this product, and wants their share of the pie. In addition, Shire has just launched the first transdermal methylphenidate medication (a Ritalin patch). THis is the same molecule that Concerta, the #2 ADHD med, uses. Shire will eat into their share with this Med. Yesterday, they filed an NDA for guanfacine, a non-stimulant ADHD med. In 8 months, once this med has been approved (the data is amazing) Strattera, which owns 10% of the ADHD market, will vomit its share up to Shire.

    In all, within the next 24 months, Shire is positioned to own over 50% of a $5B ADHD market that is growing at an annual rate of 5%, take over a $1B Mesalamine market in GI, promote its human genome therapies such as Elaprase, and continue its European launch of renal medications such as Fosrenol and Dynepo.

    While I believe that Shire will fall to $45 in the near future (there has been a lot of hype as of late), there is only upside for both this company and its stock (long term $65-$75)

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