Shire 4Q profit falls 84 pct as costs climb
Shire's 4th-quarter profit falls 84 pct as costs climb, generic drugs hurt Adderall XR sales
Shares of Shire PLC sank Thursday morning after the Irish drugmaker said its fourth-quarter earnings tumbled 84 percent on climbing costs and generic competition for its attention deficit hyperactivity disorder drug.
The Dublin company earned $42 million, or 22 cents per share, in the three months that ended Dec. 31. That compares to net income of $255.3 million, or $1.33 per share in the final quarter of 2011.
Adjusted earnings were $1.58 per share, while total revenue climbed 5 percent to $1.2 billion.
Analysts expected, on average, earnings of $1.60 per share on $1.2 billion in revenue, according to FactSet.
The company's U.S.-traded stock fell more 5.4 percent, or $5.41, to $94.96 Thursday morning, while broader trading indexes declined slightly. The stock had already climbed 9 percent so far this year to close at $100.37 on Wednesday.
Shire said revenue from Adderall XR dropped fell 35 percent to $82 million, as prescription demand fell due to the approval of a new generic version last year. Revenue from a newer ADHD drug, Vyvanse, grew 18 percent to $257 million.
Research and development costs climbed 31 percent to $281.9 million in the quarter, hiked by a $44 million asset impairment charge. Selling, general and administrative expenses rose 46 percent to $665.6 million due in part to charges tied to the acquisition of some intellectual property rights.
The company recorded a $57.5 million charge in the quarter for the resolution of a U.S. government investigation into the marketing of its attention deficit hyperactivity disorder drugs.
For the full year, Shire earned $745.4 million, or $3.93 per share, on $4.68 billion in total revenue.
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