Shire Presents Data on Venvanse

Zacks Equity Research
May 24, 2012

Shire (SHPG) recently presented positive results on Venvanse (lisdexamfetamine dimesylate) from a phase III study at the EUNETHYDIS 2nd International Attention-Deficit/Hyperactivity Disorder (:ADHD) Conference.

In this phase III double-blind, placebo-controlled, randomized study, long-term maintenance of efficacy and safety of Venvanse in children and adolescents aged 6 to 17 years with moderately symptomatic ADHD was evaluated. Significantly less treatment failures were observed in the Venvanse arm (13.5%) as compared to placebo arm (65.8%).

In December 2011, Shire had submitted a marketing application seeking European approval of Venvanse for the treatment of children and adolescents aged between 6 and 17 years who are diagnosed with ADHD. Results from this phase III study are an important part of the European submission package and will augment the chances of the drug getting approved.

Venvanse is currently marketed for ADHD in children, adolescents and adults in the U.S. and Canada under the trade name Vyvanse. The product is also marketed in Brazil for the treatment of ADHD in children.

Shire is also evaluating the product for major depressive disorder (phase III), excessive daytime sleepiness (phase II), negative symptoms of schizophrenia (phase II) and other non-ADHD indications in adults (phase II).

Our Take

Vyvanse, with $260 million revenues in the first quarter of 2012, is the top revenue grosser at Shire. As per data provided by IMS Health National Prescription Audit, Vyvanse enjoys a 17% share of the U.S. ADHD market. In the first quarter of 2012, Vyvanse’s growth of 29% was significantly higher than the U.S. ADHD market’s growth of 10%.

However, we note that competition in the U.S. market increased significantly in 2011 with the launch of generic versions of Johnson & Johnson's (JNJ) Concerta and Novartis’ (NVS) Ritalin. Moreover, a new drug, Kapvay, was launched by Japanese pharmaceutical company, Shionogi & Co., Ltd, in 2011.

Meanwhile, Shire is facing patent challenges for Vyvanse. Six companies, including Sandoz, Inc., Amneal Pharmaceuticals LLC, Watson Laboratories (WPI), Roxane Laboratories, Inc., Mylan Pharmaceuticals, Inc. (MYL) and Actavis have filed abbreviated new drug applications (ANDAs) for their generic versions of Vyvanse. Shire has filed patent infringement lawsuits against all these companies.

We currently have a Neutral recommendation on Shire. The stock carries a Zacks #3 Rank (Hold rating) in the short run.

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