Shire quashes bid speculation

SHIRE PHARMACEUTICALS, the biotechnology company specialising in treatments to combat hyperactivity, quashed speculation it was in talks to acquire its rival, Medeva, after posting more-than-doubled half-year profits.

"We are not in talks with any company currently speculated about in the press," said Stephen Stamp, finance director. Shire has walked away from talks with four companies in the past 18 months.

"We just wonder who we will be linked with next," added Rolf Stahel, chief executive. "One minute we're meant to be buying Medeva, the next we're meant to be taken over by Johnson & Johnson."

Shire aims to acquire pounds 500m in sales over the next five years. It increased its spend on identifying acquisition targets, spending pounds 2.3m in the last three months.

In the six months to 30 June, pre-tax profits soared 123 per cent to pounds 7.3m as sales rose 34 per cent to pounds 28.4m. Sales of Adderall and DextroStat, treatments for children suffering from attention deficit hyperactivity disorder, jumped 60 per cent to pounds 21.7m, giving Shire a quarter of the US hyperactivity drugs market.

Sales are expected to fall this quarter because the medication involves a treatment holiday coinciding with the vacation period.

Shire meanwhile warned its research into applying galantamine, its Alzheimer's treatment, to Chronic Fatigue Syndrome was unlikely to be a success.

The company also confirmed it had spent pounds 15m from a pounds 25m insurance fund in legal fees connected to litigation over Phentermine, the anti-obesity drug of Richwood, a US company which Shire acquired in 1997. Phentermine caused heart problems when used in combination with a similar drug.

Shire said it was confident there was no case to answer, but would have to fund any material awards against it from its own resources. Stewart Adkins, analyst at Lehman Brothers, said: "I'm not too bothered about it."