The $4 billion stock acquisition will serve to broaden and diversify Shire's therapeutic focus and reduce its reliance on revenue from Adderall. It also forms part of the company's strategy to build a global pharmaceutical business. Having expanded significantly in Europe over the past few years it now has set its sights to further opportunities across the Atlantic.
BioChem Pharma's product portfolio covers two main therapy areas at present, antivirals and vaccines. In 1999 antiviral products accounted for over 88% of product revenues. In collaboration with Glaxo Wellcome, BioChem currently markets three key products, Epivir (lamivudine), Combivir (lamivudine + zidovidine) and Zeffix (lamivudine), which generated 96.2%, or $126 million, of BioChem's revenue last year. Shire, in contrast, has a wider therapeutic portfolio and is the maker of the ampetamine, Adderall - the best selling US treatment for attention deficit disorder.
BioChem's competencies in vaccines and antivirals will complement Shire's expertise in the development of therapies for central nervous system disorders, metabolic diseases, cancer and gastroenterological conditions. In particular, the merger will allow Shire to be less dependent on Adderall. The estimated pro-forma 1999 revenue of the combined company was $587 million.
Shire has global aspirations. This latest acquisition follows a series of events that highlight company's strategy. In October 1999, the company acquired the French, Italian and German subsidiaries of Fuisz Technologies of the US. Shire also opened an operating subsidiary in Spain in June 2000. Having increased its presence in continental Europe, Shire Pharmaceuticals now appears to be expanding across the Atlantic. A presence in Canada puts it in an excellent position to support the US success of Adderall and BioChem Pharma's products. If these and pipeline products progress as hoped, Shire's presence should be strengthened on both sides of the 49th parallel.