(LSE: SHP, NASDAQ: SHPG), a biotech company focused on rare diseases, reported that its “product sales” rose 6 percent to $3.81 billion in the second quarter ended June 30. The company attributed the increase to its immunology portfolio, recently launched products (including dry eye treatment Xiidra) and international expansion. The company’s total revenues rose 5 percent to $3.920 billion, according to the announcement. Sales rose a double-digit percentage in the following segments: immunology, up 13 percent; internal medicine, up 61 percent, and ophthalmics, up 75 percent.
(Dry eye treatment Xiidra, which is marketed in the U.S. and Canada, is the single product listed in Shire’s ophthalmic business segment on the company’s website. It achieved a 75 percent increase in sales in the second quarter, and hit the $100 million mark for the period.)
Shire reported $0.9 billion in net operating cash flow, which the company said enabled it to continue debt pay-down efforts.
“Shire continued to deliver on its key priorities of commercial execution, pipeline advancement, debt pay-down and portfolio optimization during the second quarter,” chief executive officer Flemming Ornskov, MD, said in the announcement. “We drove product sales growth of 6 percent over the prior-year period, led by the strong performance of our immunology franchise, continued uptake of our recently launched products, and expansion in international markets.”
On an operating basis, Shire reported that operating income increased 108 percent to $830 million from the year-ago period’s $399 million, which the company attributed to “a decline in integration and acquisition costs and lower expense related to the unwind of inventory fair value adjustments.” Shire also noted that EBITDA margin (on a non-GAAP basis) was “slightly down” to 42 percent, compared with the year-ago margin of 43 percent. It attributed the drop to “lower gross margin partially offset by benefits from ongoing cost reduction initiatives and operating expense synergies.”
Shire also noted in its announcement that, during the second quarter, its board of directors reached an agreement with Takeda on the terms of a recommended offer for Takeda to acquire Shire. The acquisition is expected to close in2019’s first half, subject to shareholder approval of both companies and additional regulatory approvals, Shire said in its announcement.
Shire noted that its “innovative pipeline continued to advance with seven programs in registration and 16 in Phase 3.”