Shire plc (NASDAQ:SHPG) Q3 2018 Earnings Conference Call - Final Transcript
Nov 01, 2018 • 10:00 am ET
Hello, and welcome. Thank you for joining us to discuss our 2018 Third Quarter Results, which were issued earlier today. You should have received our press release and can view this presentation on Shire's website. For those not able to view the webcast, you can find the relevant slides on the Presentations and Webcasts page of shire.com.
Our speakers today are CEO, Dr. Flemming Ornskov; and Thomas Dittrich, Shire's CFO. We're also joined by our financial adviser, David Kitterick from Morgan Stanley.
(Forward-looking Cautionary Statements)
Following our presentation, we will also open up the call to Q&A. We request that you ask only a maximum of two questions. As you are aware, Shire is currently in an offer period as defined under the UK Takeover Code. Due to the restrictions under the Takeover Code, you will understand that we are limited in what additional information we can provide. I would ask you limit questions to Shire's current operations and performance.
I will now hand the presentation over to Flemming. Please turn to slide three.
We're pleased to share with you our third quarter results that once again demonstrate Shire's strong execution against our key priorities. I'll first share an overall business update, and then Thomas will take you through the financials.
Please now turn to slide four. We'll focus on three key areas today. First, we will review our continued commercial execution, which generated product sales growth of 6% in the third quarter. Building upon the first half of the year, our Immunology franchise's recently launched products and international expansion continue to drive our growth.
Second, we'll discuss our innovative pipeline, including the recent US and Canada approvals of TAKHZYRO for hereditary angioedema, which are significantly milestones for us and for the patients we serve. TAKHZYRO also received a positive opinion from the CHMP in Europe in October, with approval now expected in December of this year.
Finally, I would like to highlight several key events in the third quarter. We closed a $2.4 billion sale of our Oncology franchise to Servier on the 31st of August at an attractive 9.2 revenue multiple. We used the proceeds of this sale to accelerate our deleveraging plans with a $2.3 billion debt repurchase.
As you're aware, earlier this year, our board reached an agreement with Takeda on the terms of a recommended offer for Shire. Integration planning is ongoing and closing is expected in the first half of 2019, subject to additional regulatory clearances and subject to approval by the shareholders of both companies. I'm very proud of our team's ability to remain focused on delivering against our priorities and meeting the needs of our patients.
Kindly now turn to slide five. In the third quarter, we delivered 6% year-over-year growth, with product sales reaching $3.8 billion. Product sales growth was 7% at constant exchange rates versus prior year. The sale of our Oncology franchise reduced growth by 1 percentage points in the quarter. Including royalties and other revenues, we achieved total revenues