Q1 2012 Earnings Call
April 26, 2012 9:00 am ET
Eric Rojas - Director of Investor Relations - North America
Angus C. Russell - Chief Executive Officer and Executive Director
Sylvie Gregoire - President of Human Genetic Therapies Business and Member of Management Committee
Graham Hetherington - Chief Financial Officer, Principal Accounting Officer and Director
Jeff Jonas - Senior Vice President of Research & Development for Pharmaceuticals Business
Gary Nachman - Susquehanna Financial Group, LLLP, Research Division
Brian White - Shore Capital Group Ltd., Research Division
David M. Steinberg - Deutsche Bank AG, Research Division
Graham Parry - BofA Merrill Lynch, Research Division
David Amsellem - Piper Jaffray Companies, Research Division
Keyur Parekh - Goldman Sachs Group Inc., Research Division
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Good day, ladies and gentlemen, and welcome to the Shire's 2012 First Quarter Results Call hosted by Eric Rojas. My name is Jo, and I'm your event manager today. [Operator Instructions] I would like to advise all parties that this conference is being recorded for replay purposes.
And I would like to hand the call over to your host, Eric. Please go ahead.
Thanks, Jo. Good morning and good afternoon, everyone. Thank you for joining us today for Shire's First Quarter 2012 Financial Results. By now, you should have all received our press release and should be viewing our presentation via our website on shire.com. If for some reason you have not received the press release or are unable to access our website, please contact Souheil Salah in our U.K. Investor Relations department at +44-1256-894-160, and he will be happy to assist you.
Our speakers today are Angus Russell, Graham Hetherington, Sylvie Gregoire and Jeff Jonas. Kevin Rakin will also be available for Q&A.
Before we begin, I would refer you to Slide 2 of our presentation and remind you that any statements made during this call, which are not historical statements, will be forward-looking statements and as such will be subject to risks and uncertainties which, if they materialize, could materially affect our results.
Today's agenda is as follows: We begin with opening remarks of Shire's performance and highlights from Angus. Sylvie will give an HGT business update. Graham will continue with a financial review, and Jeff Jonas will give a pipeline update for the Specialty Pharma and Regenerative Medicine businesses, including positive top line safety results for VYVANSE and binge eating disorder. Angus will then make closing remarks, and we'll open up for your questions.
[Operator Instructions] Our Investor Relations team will be more than happy to follow up offline for any subsequent questions.
And now I'll hand over the call to our CEO, Angus Russell.
Angus C. Russell
Thanks, Eric. Hi, everyone. So turning to Page 5, let me start by just summarizing these results overall. So once again, had a very strong quarter, very strong growth coming from a balanced product portfolio. You can see a consistent performance here. Overall product sales up 24% to $1.1 billion in the quarter, and total revenues up 21%.
We turn to the next slide, Slide 6. You can see the same consistent performance reflected in both the operating income and the diluted earnings per ADS. Operating income on a non-GAAP basis up 18% to $362 million, and non-GAAP diluted earnings per ADS up 20% to $1.48.
I'll now turn to some of the business highlights in the Specialty Pharma and Regenerative Medicine businesses, starting on Slide 7. VYVANSE grew very strongly again in this quarter. U.S. prescriptions grew 23% over the same quarter last year. We're now running at something like 16.8% market share. That's a gain of 1.7% versus the same period last year.
We recently announced the commencement of head-to-head trial of VYVANSE versus Concerta. If you remember, when Jeff talked about European filing, he referred to that having a reference on in one of the studies. That came out, if you remember, with a very favorable comparison. And on the base of that, we feel very empowered now to conduct a full head-to-head study versus Concerta. You may ask why we're doing that at this stage of the product's life cycle. Simply put, it's to demonstrate to payors around the world as we contemplate the rolling out of VYVANSE on a global basis. But this is by far in a way, the best product in the class and offers best value to both patients and payors all over the world.
We're also ongoing with our enrollment in our major depressive disorder study, the first lead of our new uses of VYVANSE programs. And we also, today, have reported headline data from -- positive findings on headline data from a new Phase II study in binge eating disorder, and Jeff will be commenting on that in more detail later in his presentation.
Turning to INTUNIV. Again, very significant increase, up 54% in volume since alone in scripts versus the same period last year. Market share really being driven by new consumer marketing campaigns and also the approval early last year of the extension of the label to adjunctive therapy in combination with the stimulant. We're also remember enrolling INTUNIV in a Phase III program in Europe, and it's again our intent to bring that product to Europe a little bit behind VYVANSE. But we will end up, we hope, with the 2 leading products in ADHD appearing in Europe in the next few years.
Now moving to what's becoming really an embryonic but emerging new business area franchise for Shire, and that's hematology. This quarter, you'll have seen us make the acquisition of a product from FerroKin Biosciences, FBS0701. It's in Phase II and again, Jeff will be giving a bit more detail as to what we intend to do with that product mix.
We also earlier in the quarter signed a very interesting collaboration with a company called Sangamo, and this is focusing on developments of therapeutics for hemophilia. We've identified 3 blood factors. We're also looking at a range of potential HGT targets, and so we can talk about that later. And we're looking at other monogenic diseases based on Sangamo's technology, the so-called zinc finger protein technology.
And this adds to our existing hematology franchise of XAGRID, which is still commercialized in international markets as a rare orphan drug, and also SPD 535, which is still in development. And again, we're looking at that for different types of use in the hematology space, and we'll talk more about that probably later this year as we formalize our plans as to where we think that product can gain best utility.
And again during the quarter, we actually brought in a new product into the regenerative medicine space. This could have a very good fit with our historic presence in FOSRENOL in the dialysis suite. So the product here is VASCUGEL. We acquired it from Pervasis. Again, it's completed some early Phase II work. We'll be looking at doing more Phase II studies, and it really addresses the significant unmet medical need for improving hemodialysis access for patients with end-stage renal disease. So as I said, with our interest in FOSRENOL in the past, end-stage renal disease has been the space we've had strong relationships with the large dialysis companies. We're looking to leverage all those benefits in Shire and also bring our expertise in this sorts of technologies, cell-based technologies in the regenerative medicine field. Again, Jeff will give you a little bit more insights into next steps with that in his R&D presentation later.
So it we turn over to Slide 8, I just wanted to give you a summarized version here what the pipeline is looking like. It's very evident, I would say, from this that you see a lot of interesting projects now at all stages of development but most particularly, in the Phase II and Phase III area. And that's very important as we're all thinking about the next wave of growth that comes in Shire. We have, as you know, very strong growth prospects such as we're reporting today, and we see significant ongoing growth potential in the next few years. But like any pharmaceutical company, we have to be investing in the future. And that is what we intend to continue to do through other quarters in the future.