Personal Finance

Here's Why Shire PLC Stock Fell 10% in August

Crude chalk drawing of a downward sloping chart.

What happened

Shares of Shire PLC (NASDAQ: SHPG) , a biopharmaceutical company that focuses on treatments for rare diseases, fell 9.94% in August, according to data from S&P Global Market Intelligence . Slipping sales figures for both a recently acquired hemophilia therapy and an aging attention deficit drug overshadowed an otherwise encouraging earnings report.

So what

Last June, Shire completed a $32 billion merger with Baxalta that appears to be firing on all cylinders except one: hemophilia. On a pro forma basis, combined product sales rose 7%, but inhibitor therapy sales to hemophiliacs fell 7% compared to the previous year period. According to Shire, sales of its drug FEIBA (an acronym for factor eight inhibitor bypassing activity) should make up about 5% of the company's total revenue this year. FEIBA, which is prescribed to patients who have developed inhibitors that reduce the effectiveness of other clotting factor replacement therapies, earned its first approval 31 years ago.

Crude chalk drawing of a downward sloping chart.

Image source: Getty Images.

Investors were also dismayed by Adderall XR's sales figures. Generic competition for the attention deficit disorder treatment pushed its Q2 sales down by 30% year over year.

Now what

At $71.4 million, Adderall XR sales comprised just 2% of Shire's total during the three-month period that ended June 30. While generics will likely squeeze sales of the drug even further, a recently launched follow-on treatment could partially offset those losses. Mydayis is essentially a 16-hour version of Adderall XR, which generally lasts for 12 hours.

Unfortunately, the company doesn't have a ready replacement for FEIBA. A gene therapy candidate for the treatment of hemophilia A, called SHP654, will enter clinical trials by the end of the year, but the company expects FEIBA sales to fall to 50% of present levels by 2022.

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Cory Renauer has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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