Shire Announces Increase of 50% in Pre-Tax Income for First Quarter 2001

Apr 26, 2001, 01:00 ET from Shire Pharmaceuticals Group plc

    BASINGSTOKE, UK, April 26 /PRNewswire/ -- Shire Pharmaceuticals Group plc
 (LSE:   SHP.L, Nasdaq: SHPGY) announces results for the first quarter ended 31
 March 2001.
 
      Highlights:
                              After
                              APB25
                              charge(a)               Before APB25 charge
 
 
                               Q1-01         Q1-01        Q1-00          %
                                ($m)         ($m)          ($m)        change
 
       Revenues               155.6         155.6        119.0           +31
       Operating income        39.9          42.0         29.2           +44
       Income before tax       38.0          40.1         26.7           +50
       EPS (diluted)
        - per ordinary share   9.9c         10.7c         7.3c           +46
        - per ADS             29.7c         32.1c        22.0c           +46
 
 
      Average
      USD:GBP exchange rate    Q1 2001   1.44
                               Q1 2000   1.60
 
     Financial Highlights
 
      - Adderall* sales up 29% with a 33.3% share(b) of the US Attention
        Deficit Hyperactivity Disorder (ADHD) prescription market in March 2001
        (March 2000: 29.7%).
 
      - Agrylin* continues to grow strongly; US prescriptions increased by 43%
        in March 2001 compared to March 2000. Sales grew 56% compared with the
        same period last year. Agrylin* achieved 20.4% market share(b) of the
        combined US Agrylin, Hydrea and hydroxyurea market.
 
      - Pentasa* sales up 39% on Q1 2000; achieved 17.8% share(b) of the US
        oral mesalamine/olsalazine market in March 2001.
 
      - Carbatrol* achieved sales growth of 72% and 32.5% share(b) of the US
        extended release carbamazepine market in March 2001.
 
      - ProAmatine* sales up 112% on Q1 2000; US prescriptions up by 31% on the
        same period last year.
 
 
 
     Business Highlights
 
      - Anagrelide (marketed as Agrylin* in US) granted Orphan Drug Status in
        Europe.
 
      - Reminyl* receives Food and Drug Administration (FDA) approval on 28
        February 2001. US launch targeted for May 2001.
 
      - Foznol* (lanthanum carbonate) first regulatory filing in Europe on 13
        March 2001.  US regulatory filing expected by end of Q4 2001.
 
      - Adderall XR* (SLI 381) Phase III data to be presented at the American
        Psychiatric Association (APA) on 9 May 2001.
 
     Commenting on the results, Rolf Stahel, Chief Executive of Shire, said:
     "I am delighted to announce excellent first quarter results, with
 outstanding revenue growth of 31% and an increase of 50% in pre tax income.
     "Following the approval of Reminyl* in the US on 28 February 2001, we are
 looking forward to the US launch by Janssen Pharmaceutica and Ortho-McNeil
 Pharmaceutical. Their intention is to make Reminyl* available on prescription
 during the course of May 2001. In addition, the first filing of Foznol* in
 Europe achieves another very important milestone for Shire.
     "In respect of the proposed merger with BioChem Pharma Inc, although the
 current review period with Industry Canada expires on 27 April 2001, Shire
 requested an extension on 25 April 2001.
     "Discussions with Industry Canada are ongoing and we remain firmly
 committed to obtaining the Canadian Minister of Industry's approval for the
 proposed merger with BioChem Pharma Inc."
 
     Notes to editors
     Shire Pharmaceuticals Group plc
     Shire is a rapidly growing international specialty pharmaceutical company
 with a strategic focus on four therapeutic areas: central nervous system
 disorders, metabolic diseases, oncology and gastroenterology. The Group has a
 sales and marketing infrastructure with a broad portfolio of products, with
 its own direct marketing capability in the US, Canada, UK, Republic of
 Ireland, France, Germany, Italy and Spain and with plans to add Japan by 2004.
 Shire also covers other significant pharmaceutical markets indirectly through
 distributors and sales coverage continues to grow.
     Shire's global search and development expertise has to date successfully
 provided eight marketed products, of which Reminyl* for the treatment of
 Alzheimer's disease has recently been launched in the UK, its first market in
 Europe. The National Institute of Clinical Excellence (NICE) recommended on
 19 January 2001 that treatment for Alzheimer's disease be made available
 through the National Health Service (NHS) in the UK. Additionally, on
 28 February 2001 Reminyl* received Food and Drug Administration (FDA) approval
 to be marketed in the US. The current pipeline of 17 projects includes three
 projects in registration in various countries, plus the delivery of the first
 regulatory submission for Foznol* to a Reference Member State in the EU Mutual
 Recognition Procedure on 13 March 2001, and 6 others that are post Phase II.
 Shire is actively seeking to acquire further marketed products and development
 projects to enhance the potential for future growth. Shire's M&A activity has
 resulted in five completed mergers and acquisitions during the last six years.
     On 11 December 2000, Shire entered into an agreement to merge with BioChem
 Pharma Inc. to form a leading global specialty pharmaceutical company. More
 details on this proposed merger and other aspects of the company are available
 on the Shire website at www.shire.com .
 
     *Trade Mark
 
     THE "SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM
 ACT OF 1995. The statements in this press release that are not historical
 facts are forward-looking statements that involve risks and uncertainties,
 including but not limited to, risks associated with the inherent uncertainty
 of pharmaceutical research, product development and commercialization, the
 impact of competitive products, patents, and other risks and uncertainties,
 including those detailed from time to time in periodic reports, including the
 Annual Report filed on Form 10K by Shire with the Securities and Exchange
 Commission.
 
     OVERVIEW OF FINANCIAL RESULTS
     Group revenues for the first quarter increased by 31% to $155.6 million
 (Q1 2000: $119.0 million). The Group recorded income before tax and APB25
 charge of $40.1 million, up 50% (Q1 2000: $26.7 million) and diluted earnings
 per ordinary share pre APB25 charge of 10.7 cents or 32.1 cents per ADS, up
 46% (Q1 2000: 7.3 cents per ordinary share or 22.0 cents per ADS).  Net income
 (after APB25 charge of $2.1 million) was $26.0 million (Q1 2000: $4.3 million
 net loss after APB25 charge of $23.2 million).
 
     Sales and marketing
     Product sales, at $151.4 million, increased by 34% over Q1 2000.  Sales of
 Adderall* were $70.1 million, representing growth of 29% on the comparative
 period in 2000, which included some stock-building by wholesalers ahead of
 anticipated price increases.  Adderall* had a 33.3% share of the prescription
 market for Attention Deficit Hyperactivity Disorder (ADHD) in the US in March
 2001 (March 2000: 29.7%) and continues to be the brand leader in the US market
 for ADHD.
     Sales of Agrylin*, the only US product licensed for the treatment of
 thrombocythaemia, were $17.1 million, a 56% increase on Q1 2000 sales of
 $11.0 million, when sales were slightly below trend due to wholesaler de-
 stocking. Shire achieved a prescription share of 20.4% of the total US
 Agrylin, Hydrea and generic hydroxyurea market in March 2001, compared to
 14.3% for the month of March 2000.
     Sales of Pentasa*, for the treatment of ulcerative colitis, were
 $14.4 million, 39% higher than the comparable period last year, when sales
 were below trend due to wholesaler de-stocking following a price increase in
 Q4 1999. Pentasa* had a prescription share of 17.8% of the US oral
 mesalamine/olsalazine market in March 2001, compared to 18.0% in March 2000.
     Sales of ProAmatine*, for the treatment of postural hypotension, were
 $7.6 million, 112% higher than Q1 2000 sales of $3.6 million, when sales were
 also below trend due to wholesaler de-stocking following a price increase in
 Q4 1999. The US prescription market for ProAmatine* and Florinef prescriptions
 indicates that ProAmatine* had a 22.1% share for the month of March 2001, an
 increase from 19.5% in March 2000.
     Carbatrol*, containing carbamazepine, recorded sales growth of 72% from
 sales of $5.6 million in Q1 2000 to $9.6 million in Q1 2001. This translates
 to 32.5% of the US extended release carbamazepine prescription market in March
 2001, compared to 26.0% in March 2000.
 
     Licensing
     Licensing and development fees in the first quarter fell by 38% to
 $3.0 million (Q1 2000: $4.9 million) and included one-time receipts of third
 party milestone payments in respect of Reminyl* Food and Drug Administration
 (FDA) approval and SLI drug delivery contracts. The quarter on quarter
 decrease is mainly due to the reduction in development stage activities for
 Reminyl* and hence the ending of reimbursement revenues for actual costs
 incurred on bulb-related raw material.   Royalties increased by $0.3 million
 to $0.9 million (Q1 2000: $0.6 million).
 
     Cost of sales and operating expenses
     Gross margin on product sales, at 82%, was consistent with Q1 2000. The
 higher margin products, particularly Adderall* and Agrylin* represented
 approximately 57% of total product sales in Q1 2001, also consistent with Q1
 2000.
     R&D expenditure for the first quarter increased by 4% to $27.2 million.
 Expressed as a percentage of revenues, R&D expenditure was 17% in Q1 2001
 compared to 22% in Q1 2000 and 21% for full year 2000. R&D expenditure was
 particularly high in Q1 2000 due to the upfront payment for the in-licensing
 of SPD 421 from D-Pharm. The relatively low R&D to revenue ratio in Q1 2001 is
 mainly related to phasing of project costs resulting in lower than usual costs
 during the quarter.
     Selling, general and administrative (S,G&A) expenses, excluding the
 effects of an APB25 charge, increased by 41% to $49.5 million (Q1 2000:
 $35.2 million). As a percentage of product sales S,G&A expenses increased by
 2% to 33%. This increase reflects the growth in the US sales force since Q1
 2000 and increased marketing activities in respect of the anticipated Adderall
 XR* launch.
     The APB25 charge for the quarter was $2.1 million. This substantial
 reduction compared to the Q1 2000 charge of $23.2 million reflects minor
 amendments to the executive share option scheme effective from March 2000.
     Depreciation and amortization increased by 13% to $8.6 million (Q1 2000:
 $7.6 million). This increase is attributable to the purchase of several new
 products since March last year.
 
     Taxation
     The effective rate of tax on the profits for the quarter pre APB25 is 30%
 (Q1 2000: 29%). The company has recorded net deferred tax assets of
 approximately $26.8 million.
 
     Cash flow
     Net cash inflow from operating activities of $58.0 million provided
 funding for two product acquisitions in Europe ($18.3 million) and tangible
 fixed asset additions of $1.5 million. Cash inflow from financing activities
 of $2.1 million related to employee stock option exercises.
     Cash, cash equivalents, marketable securities and other current assets at
 31 March 2001 amounted to $225.4 million. After deduction of borrowings this
 gives a net cash position of $97.5 million.
 
 
     PROJECTS UNDER DEVELOPMENT
 
     Central nervous system disorders
 
     Alzheimer's disease
     Reminyl* was launched in the UK in September 2000. In January 2001, the UK
 National Institute of Clinical Excellence (NICE) announced that treatments for
 Alzheimer's disease should be made available as part of the management of
 patients with mild to moderate Alzheimer's disease within the UK. This was
 followed on 28 February 2001 by approval from the Food and Drug Administration
 (FDA) for Reminyl* in the US. Janssen Pharmaceutica and Ortho-McNeil
 Pharmaceutical will be marketing Reminyl* in this market and intend to make
 the product available on prescription from May 2001.
     By 31 March 2001, Reminyl* had been launched in 11 countries, including
 the UK and Ireland.  A number of further launches are planned over the coming
 months.
 
     ADHD
     New pivotal data on the once daily formulation of Adderall*, SLI 381,
 under development for the treatment of ADHD, have been accepted as a platform
 presentation at the annual meeting of the American Psychiatric Association
 (APA). The oral presentation of safety and efficacy results will take place on
 Wednesday, 9 May, at 11:00 am at the APA's 2001 annual meeting in New Orleans,
 at which point Shire will publish the relevant posters. The once daily
 medication, currently known by its project designation, SLI 381 (proposed
 Trade Mark Adderall XR), is a novel formulation of Adderall* (mixed salts of a
 single-entity amphetamine product) that incorporates Shire's Microtrol(TM)
 advanced drug delivery system.
 
     Oncology/haematology
 
     Thrombocythaemia
     On 3 January 2001, Shire announced that the European Commission had
 granted orphan drug designation to anagrelide for the treatment of essential
 thrombocythaemia. This designation covers the EU, plus Norway and Iceland, and
 provides up to 10 years market exclusivity for the product following Marketing
 Authorization Approval. Orphan drug status already applies to anagrelide in
 the US, where the product is marketed as Agrylin*, and in Japan where it will
 run for 10 years following marketing approval.
 
     Metabolic diseases
 
     Hyperphosphataemia
     The first regulatory submission for Foznol* (lanthanum carbonate) was
 delivered to a Reference Member State in the EU Mutual Recognition Procedure
 on 13 March 2001.  Foznol is being developed for the treatment of
 hyperphosphataemia in patients with chronic renal failure.
 
     Future Prospects
     In respect of the proposed merger with BioChem Pharma Inc, although the
 current review period with Industry Canada expires on 27 April 2001, Shire
 requested an extension on 25 April 2001.
     Discussions with Industry Canada are ongoing and Shire remains firmly
 committed to obtaining the Canadian Minister of Industry's approval for the
 proposed merger with BioChem Pharma Inc.
     Progress towards the launch of Adderall XR* continues and this will lead
 to ongoing marketing expenditure. R&D expenditure as a percentage of revenue
 is expected to move back towards historic ranges in subsequent quarters.
     With the forthcoming US launch of Reminyl* expected and the recent
 regulatory filing for Foznol* in Europe, management remains confident about
 the company's future growth prospects.
 
    * Trade Mark
 
 
     Unaudited consolidated balance sheets
     US GAAP
 
                                                   31.03.2001     31.03.2000
                                                     $'000          $'000
     ASSETS
     Current assets:
     Cash and cash equivalents                         82,835         67,307
     Marketable securities and other
      current asset investments                       142,553         58,020
     Accounts receivable, net                          70,993         75,689
     Inventories, net                                  43,773         39,828
     Deferred tax asset                                18,722          5,312
     Prepaid expenses and other current assets         14,373          6,211
 
     Total current assets                             373,249        252,367
 
     Investments                                        5,756          2,604
     Property, plant and equipment, net                47,867         38,813
     Intangible assets, net                           561,458        550,536
     Deferred tax asset                                 8,047         31,799
     Other assets                                      21,850          5,058
 
     Total assets                                   1,018,227        881,177
 
     LIABILITIES AND SHAREHOLDERS' EQUITY
     Current liabilities:
     Current installments of long-term debt             1,470          5,333
     Accounts and notes payable                        97,313        106,695
     Other current liabilities                         19,765          9,214
 
     Total current liabilities                        118,548        121,242
 
     Long-term debt, excluding current installments   126,436        128,040
 
     Other long-term liabilities                       11,532            541
 
     Total liabilities                                256,516        249,823
 
     Shareholders' equity:
     Common stock, 5p par value; 400,000,000(2000:
      400,000,000) shares authorized; and
      257,950,135 (2000: 251,376,841) shares issued
      and outstanding respectively                     21,097         20,611
     Additional paid-in capital                       945,735        883,257
     Accumulated other comprehensive losses          (52,121)       (13,122)
     Accumulated deficit                            (153,000)      (259,392)
 
     Total shareholders' equity                       761,711        631,354
 
     Total liabilities and shareholders' equity     1,018,227        881,177
 
 
     Unaudited consolidated income statements
     US GAAP
 
                                                   3 months          3 months
                                                  to 31.03.01      to 31.03.00
                                                     $'000            $'000
 
     Total revenues                                   155,641        118,978
     Cost of revenues                                 (27,713)       (20,905)
 
     Gross profit                                     127,928         98,073
 
     Operating expenses                               (88,010)       (92,118)
 
     Operating income                                  39,918          5,955
 
     Interest income                                    2,536          1,371
     Interest expense                                  (2,801)        (3,405)
     Other expense                                     (1,668)          (431)
 
     Total other expenses                              (1,933)        (2,465)
 
     Income before income taxes                        37,985          3,490
 
     Income taxes                                     (12,030)        (7,756)
 
     Net income/(loss) - see below                     25,955         (4,266)
 
     Net income/(loss) per share:
     Basic                                              10.1c         (1.7)c
     Diluted                                             9.9c         (1.7)c
 
     Weighted average number of shares:
     Basic                                        257,390,769    246,672,276
     Diluted                                      262,649,651    246,672,276
 
 
     Supplemental information
 
     Net income/(loss) as above                        25,955         (4,266)
     Add back:
     APB25 stock option compensation charge             2,121         23,246
 
     Net income before APB25                           28,076         18,980
 
     Net income before APB25
      per ordinary share
     Basic                                              10.9c           7.7c
     Diluted                                            10.7c           7.3c
 
     Net income before APB25 per ADS
     Basic                                              32.7c          23.1c
     Diluted                                            32.1c          22.0c
 
     The diluted net income before APB25 per ordinary share uses the fully
     diluted weighted average number of shares of 259,301,631. This is not used
     when the result is a net loss because it would have an anti-dilutive
     effect.
 
 
     Unaudited consolidated statements of cash flows
     US GAAP
 
                                                     3 months        3 months
                                                    to 31.03.01    to 31.03.00
                                                       $'000          $'000
 
     Cash flows from operating activities:
     Net income/(loss)                                 25,955         (4,266)
     Adjustments to reconcile net income/(loss)
      to net cash provided by/(used
      in) operating activities:
 
     Depreciation and amortization                      8,600          7,592
     Stock option compensation                          2,121         23,246
     Tax benefit of stock option compensation,
      charged directly to equity                        3,090          1,072
     Non cash exchange gains and losses               (10,311)          (151)
     Loss on disposal of fixed assets                     607              -
     Decrease/(increase) in inventory                   3,336           (290)
     Decrease in deferred tax asset                     6,500              -
     Decrease/(increase) in accounts receivable        18,816        (14,410)
     Decrease in accounts payable                        (668)       (48,556)
 
     Net cash provided by/(used in)
       operating activities                            58,046        (35,763)
 
     Cash flows from investing activities:
     Redemption of marketable securities, net          46,000         31,687
     Increase in cash placed on short-term deposit    (48,808)        (5,363)
     Expenses of acquisition of subsidiaries                -           (212)
     Purchase of intangible fixed assets              (18,335)             -
     Purchase of fixed assets                          (1,544)        (1,935)
     Collection on notes receivable                         -            520
 
     Net cash (used in)/provided by investing
       activities                                     (22,687)        24,697
 
 
     Cash flows from financing activities:
     Movements on long term debt                           94         (2,549)
     Proceeds from issue of common stock                    -          3,033
     Payment of stock issuance costs                      (16)        (3,385)
     Proceeds from exercise of options                  2,109         27,192
 
     Net cash provided by financing activities          2,187         24,291
 
     Effect of foreign exchange rate changes
      on cash and cash equivalents                     (1,309)             -
 
     Net increase in cash and cash equivalents         36,237         13,225
     Cash and cash equivalents at beginning of period  46,598         54,082
 
     Cash and cash equivalents at end of period        82,835         67,307
 
 
     NOTES
 
     1.    Analysis of revenue, operating income and reportable segments
 
           The company has disclosed segmental information for the individual
           operating areas of the business, based on the way in which the
           business is managed and controlled. Shire's principal reporting
           segments are geographic, each being managed and monitored separately
           and serving different markets. The company evaluates performance
           based on operating income or loss before interest and income taxes.
 
 
     Three months to March 31, 2001
                                                       Rest of
                              US          Europe        World         Total
                             $'000        $'000         $'000         $'000
 
     Product sales          126,804        18,330        6,270       151,404
     Licensing and
      development             2,085           956            -         3,041
     Royalties                   60           358          503           921
     Other revenues               -             -          275           275
 
     Total revenue          128,949        19,644        7,048       155,641
 
 
     Cost of revenues        17,877         6,529        3,307        27,713
     Research and
      development            19,916         7,188           61        27,165
     Selling, general
      and administrative     35,815        14,027        1,796        51,638
     Losses on disposal of
      assets                    591            14            2           607
 
     Total operating
      expenses               74,199        27,758        5,166       107,123
 
     EBITDA                  54,750        (8,114)       1,882        48,518
     Depreciation and
      amortization           (4,460)       (4,135)          (5)       (8,600)
 
     Operating income/(loss) 50,290       (12,249)       1,877        39,918
 
 
     Three months to March 31, 2000
                                                       Rest of
                              US          Europe        World         Total
                             $'000        $'000         $'000         $'000
 
     Product sales           93,102        15,243        4,820       113,165
     Licensing and
      development             1,376         3,534            -         4,910
     Royalties                   44           561            -           605
     Other revenues               3             -          295           298
 
     Total revenue           94,525        19,338        5,115       118,978
 
     Cost of revenues        12,955         5,730        2,220        20,905
     Research and
      development            17,247         8,808           17        26,072
     Selling, general
      and administrative     22,420        34,107        1,927        58,454
 
     Total operating
      expenses               52,622        48,645        4,164       105,431
 
     EBITDA                  41,903       (29,307)         951        13,547
     Depreciation and
      amortization           (3,718)       (3,688)        (186)       (7,592)
 
     Operating income/(loss) 38,185       (32,995)         765         5,955
 
 
     2.    Net income/(loss) per share
 
           Basic net income/(loss) per share is based upon the net
           income/(loss) available to common stockholders divided by the
           weighted average number of common shares outstanding during the
           period. Diluted net income/(loss) per share is based upon income
           available to common stockholders divided by the weighted average
           number of common shares outstanding during the period and adjusted
           for the effect of all dilutive potential common shares that were
           outstanding during the period.
 
     The following table sets forth the computation for basic and diluted net
     income/(loss) per share:
 
 
                                                    3 months          3 months
                                                  to 31.03.01       to 31.03.00
                                                      $'000            $'000
 
     Numerator for basic net income per share         25,955          (4,266)
     Interest on convertible debt, net of tax             44               -
 
     Numerator for diluted net income per share       25,999          (4,266)
 
 
                                                No. of shares    No. of shares
 
     Weighted average number of shares:
     Basic                                        257,390,769    246,672,276
     Effect of dilutive stock options               4,666,975              -
     Convertible debt                                 591,907              -
 
     Diluted                                      262,649,651    246,672,276
 
     Basic net income per share                         10.1c         (1.7)c
 
     Diluted net income per share                        9.9c         (1.7)c
 
 
     3.  Net product sales data
 
                            3 months     3 months      3 months      3 months
                          to 31.03.01   to 31.03.00   to 31.03.01  to 31.03.01
                             $'000        $'000        % increase   % of total
 
     Adderall*               70,146        54,539         +29%           46%
     Agrylin*                17,146        11,005         +56%           11%
     Pentasa*                14,400        10,347         +39%           10%
     Carbatrol*               9,639         5,592         +72%            6%
     Calciums                 4,795         3,985         +20%            3%
     ProAmatine*              7,577         3,575        +112%            5%
     DextroStat*              1,628         2,312         -30%            1%
     OTC                      7,325         5,801         +26%            5%
     Others                  18,748        16,009         +17%           13%
 
                            151,404       113,165          34%          100%
 
 
     * Trade Mark
 
 
     Unaudited consolidated profit and loss accounts
     UK GAAP
 
                                                  3 months       3 months
                                                to 31.03.01    to 31.03.00
                                            (pounds sterling) (pounds sterling)
                                                   '000             '000
 
     Turnover                                      108,115         74,471
     Cost of sales                                 (28,931)       (14,038)
 
     Gross profit                                   79,184         60,433
 
     Other operating expenses                      (54,359)       (46,298)
 
     Operating profit                               24,825         14,135
 
     Finance charges, net                           (6,450)        (1,247)
 
     Profit on ordinary activities before taxation  18,375         12,888
 
     Taxation                                       (1,744)        (4,175)
 
     Profit on ordinary activities after taxation   16,631          8,713
 
     Earnings per share
     - basic                                           6.5p           3.5p
     - diluted                                         6.3p           3.4p
 
 
     All results included above relate to the continuing operations of the
     Group.
 
     Unaudited consolidated statement of total recognized gains and losses
 
 
                                                 3 months       3 months
                                                to 31.03.01    to 31.03.00
                                            (pounds sterling) (pounds sterling)
                                                   '000             '000
 
     Profit for the period                         16,631          8,713
     Translation of overseas subsidiaries'
      financial statements                         13,336          1,832
 
     Total recognized gains and losses
      relating to the period                       29,967         10,545
 
 
     Unaudited consolidated balance sheets
     UKGAAP
 
 
                                                  31.03.01       31.03.00
                                            (pounds sterling) (pounds sterling)
                                                   '000             '000
     Fixed assets
     Goodwill                                      441,105        463,825
     Other intangible assets                       271,846        215,445
     Tangible assets                                33,669         24,330
     Fixed asset investments                         4,230          1,632
 
                                                   750,850        705,232
 
     Current assets
     Stocks                                         30,789         24,966
     Debtors
     - due within one year                          60,056         54,508
     - due after one year                           15,369              -
     Investments                                   100,269         36,369
     Cash at bank and in hand                       58,265         42,191
                                                   264,748        158,034
     Creditors: amounts falling due
      within one year                              (83,415)       (76,078)
 
     Net current assets                            181,333         81,956
 
     Total assets less current liabilities         932,183        787,188
     Creditors: amounts falling due in more
      than one year                                (97,125)       (80,574)
 
     Net assets                                    835,058        706,614
 
     Capital and reserves
     Called-up share capital                        12,898         12,569
     Share premium                                 874,971        855,465
     Capital reserve                                 2,755          2,755
     Other reserves                                 24,247         24,247
     Profit and loss account                       (79,813)      (188,422)
 
     Equity shareholders' funds                    835,058        706,614
 
     Basis of preparation
     The accounts have been prepared in accordance with the accounting policies
 set out in the full UK statutory accounts for the year ended December 31,
 2000. The results for the three months ended March 31, 2001 and 2000 have not
 been audited and do not constitute statutory accounts within the meaning of
 Section 240 of the Companies Act 1985.
 
     Summary of significant differences between US generally accepted
 accounting principles followed by the Group and UK generally accepted
 accounting principles
 
     The Group's consolidated financial statements have been prepared under US
 GAAP, which differs in certain respects from UK GAAP. The principal
 differences between the Group's accounting policies under US GAAP and UK GAAP
 are set out in the tables below:
 
     Reconciliation of net income from US GAAP to UK GAAP
 
 
                               3 months    3 months     3 months     3 months
                             to 31.03.01  to 31.03.00  to 31.03.01  to 31.03.00
                                $'000        $'000         (pounds sterling)
                                                          '000         '000
 
     Net income/(loss) as
       reported under US GAAP   25,955       (4,266)      17,853     (2,661)
 
     Adjustments to conform
      to UK GAAP:
       Merger accounting
        adjustments
        - restructuring costs
          charged to income        (60)         (60)         (42)       (36)
     Amortization of capitalized
      goodwill                   2,451        2,715        1,698      1,699
     Amortization under
      acquisition accounting    (8,237)      (9,120)      (5,706)    (5,706)
     Derecognition of deferred
      tax asset                  6,500            -        4,573          -
     Stock option compensation
      costs                      2,121       23,246        1,444     14,522
     Tax benefit from exercise
      of non-qualified stock
      options                    3,090        1,072        1,959        673
     Difference in accounting
      for convertible debt          (1)         354           (1)       222
     Accrued taxes on share
       options                      10            -            7          -
     Foreign exchange on US$
      denominated liabilities        -            -       (5,154)         -
 
     Net income as reported
      under UK GAAP             31,829       13,941       16,631      8,713
 
     Reconciliation of total shareholders' equity from US GAAP to UK GAAP
 
 
                                3 months    3 months     3 months     3 months
                                 $'000        $'000        (pounds sterling)
                                                          '000         '000
 
     Total shareholders' equity
      as reported under US GAAP  761,711     631,354     535,777      395,760
     Adjustments to conform to
      UK GAAP:
       Merger accounting
        adjustments - restructuring
        costs charged to income      110         350          77          218
     Goodwill written off to
      reserves                  (191,215)   (214,561)   (134,497)    (134,496)
     Goodwill amortization        35,148      28,604      24,723       17,930
     Net book value of goodwill
      on acquisition accounting
      for Roberts Pharmaceutical
      Corporation                607,605     718,271     427,386      450,243
     Deferred tax                (26,769)    (37,111)    (18,830)     (23,263)
     Difference in accounting
      for convertible debt           464         354         327          222
     Difference in valuation of
      fixed asset investments        258           -         181            -
     Accrued taxes on share
      options                       (123)          -         (86)           -
 
     Total shareholders' equity
      as reported under
      UK GAAP                  1,187,189   1,127,261     835,058      706,614
 
 
     Earnings per share per UK adjusted results
     Earnings per share has been calculated by dividing the profit on ordinary
 activities after taxation for each period by the weighted average number of
 shares in issue during those periods, in accordance with FRS14.
     The weighted average number of shares used in calculating fully diluted
 earnings per share has been adjusted for the effects of all dilutive potential
 ordinary shares in accordance with FRS14.
 
 
                                                 3 months      3 months
                                                to 31.03.01   to 31.03.00
                                                  (pounds sterling '000)
 
     Profit for the period
      (for basic and diluted EPS)                  16,631        8,713
 
     Weighted average number of shares in
      issue for basic EPS                     257,390,769  246,672,276
     Number of dilutive potential shares        5,258,882   12,629,355
 
     Total for fully diluted EPS              262,649,651  259,301,631
 
 
     a) Results stated after APB25 charge are as set out in Shire's
        consolidated income statement on page 9
 
     b) Prescription market (IMS) March 2001
 
     *Trade Mark
 
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X23431848
 
 

SOURCE Shire Pharmaceuticals Group plc
    BASINGSTOKE, UK, April 26 /PRNewswire/ -- Shire Pharmaceuticals Group plc
 (LSE:   SHP.L, Nasdaq: SHPGY) announces results for the first quarter ended 31
 March 2001.
 
      Highlights:
                              After
                              APB25
                              charge(a)               Before APB25 charge
 
 
                               Q1-01         Q1-01        Q1-00          %
                                ($m)         ($m)          ($m)        change
 
       Revenues               155.6         155.6        119.0           +31
       Operating income        39.9          42.0         29.2           +44
       Income before tax       38.0          40.1         26.7           +50
       EPS (diluted)
        - per ordinary share   9.9c         10.7c         7.3c           +46
        - per ADS             29.7c         32.1c        22.0c           +46
 
 
      Average
      USD:GBP exchange rate    Q1 2001   1.44
                               Q1 2000   1.60
 
     Financial Highlights
 
      - Adderall* sales up 29% with a 33.3% share(b) of the US Attention
        Deficit Hyperactivity Disorder (ADHD) prescription market in March 2001
        (March 2000: 29.7%).
 
      - Agrylin* continues to grow strongly; US prescriptions increased by 43%
        in March 2001 compared to March 2000. Sales grew 56% compared with the
        same period last year. Agrylin* achieved 20.4% market share(b) of the
        combined US Agrylin, Hydrea and hydroxyurea market.
 
      - Pentasa* sales up 39% on Q1 2000; achieved 17.8% share(b) of the US
        oral mesalamine/olsalazine market in March 2001.
 
      - Carbatrol* achieved sales growth of 72% and 32.5% share(b) of the US
        extended release carbamazepine market in March 2001.
 
      - ProAmatine* sales up 112% on Q1 2000; US prescriptions up by 31% on the
        same period last year.
 
 
 
     Business Highlights
 
      - Anagrelide (marketed as Agrylin* in US) granted Orphan Drug Status in
        Europe.
 
      - Reminyl* receives Food and Drug Administration (FDA) approval on 28
        February 2001. US launch targeted for May 2001.
 
      - Foznol* (lanthanum carbonate) first regulatory filing in Europe on 13
        March 2001.  US regulatory filing expected by end of Q4 2001.
 
      - Adderall XR* (SLI 381) Phase III data to be presented at the American
        Psychiatric Association (APA) on 9 May 2001.
 
     Commenting on the results, Rolf Stahel, Chief Executive of Shire, said:
     "I am delighted to announce excellent first quarter results, with
 outstanding revenue growth of 31% and an increase of 50% in pre tax income.
     "Following the approval of Reminyl* in the US on 28 February 2001, we are
 looking forward to the US launch by Janssen Pharmaceutica and Ortho-McNeil
 Pharmaceutical. Their intention is to make Reminyl* available on prescription
 during the course of May 2001. In addition, the first filing of Foznol* in
 Europe achieves another very important milestone for Shire.
     "In respect of the proposed merger with BioChem Pharma Inc, although the
 current review period with Industry Canada expires on 27 April 2001, Shire
 requested an extension on 25 April 2001.
     "Discussions with Industry Canada are ongoing and we remain firmly
 committed to obtaining the Canadian Minister of Industry's approval for the
 proposed merger with BioChem Pharma Inc."
 
     Notes to editors
     Shire Pharmaceuticals Group plc
     Shire is a rapidly growing international specialty pharmaceutical company
 with a strategic focus on four therapeutic areas: central nervous system
 disorders, metabolic diseases, oncology and gastroenterology. The Group has a
 sales and marketing infrastructure with a broad portfolio of products, with
 its own direct marketing capability in the US, Canada, UK, Republic of
 Ireland, France, Germany, Italy and Spain and with plans to add Japan by 2004.
 Shire also covers other significant pharmaceutical markets indirectly through
 distributors and sales coverage continues to grow.
     Shire's global search and development expertise has to date successfully
 provided eight marketed products, of which Reminyl* for the treatment of
 Alzheimer's disease has recently been launched in the UK, its first market in
 Europe. The National Institute of Clinical Excellence (NICE) recommended on
 19 January 2001 that treatment for Alzheimer's disease be made available
 through the National Health Service (NHS) in the UK. Additionally, on
 28 February 2001 Reminyl* received Food and Drug Administration (FDA) approval
 to be marketed in the US. The current pipeline of 17 projects includes three
 projects in registration in various countries, plus the delivery of the first
 regulatory submission for Foznol* to a Reference Member State in the EU Mutual
 Recognition Procedure on 13 March 2001, and 6 others that are post Phase II.
 Shire is actively seeking to acquire further marketed products and development
 projects to enhance the potential for future growth. Shire's M&A activity has
 resulted in five completed mergers and acquisitions during the last six years.
     On 11 December 2000, Shire entered into an agreement to merge with BioChem
 Pharma Inc. to form a leading global specialty pharmaceutical company. More
 details on this proposed merger and other aspects of the company are available
 on the Shire website at www.shire.com .
 
     *Trade Mark
 
     THE "SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM
 ACT OF 1995. The statements in this press release that are not historical
 facts are forward-looking statements that involve risks and uncertainties,
 including but not limited to, risks associated with the inherent uncertainty
 of pharmaceutical research, product development and commercialization, the
 impact of competitive products, patents, and other risks and uncertainties,
 including those detailed from time to time in periodic reports, including the
 Annual Report filed on Form 10K by Shire with the Securities and Exchange
 Commission.
 
     OVERVIEW OF FINANCIAL RESULTS
     Group revenues for the first quarter increased by 31% to $155.6 million
 (Q1 2000: $119.0 million). The Group recorded income before tax and APB25
 charge of $40.1 million, up 50% (Q1 2000: $26.7 million) and diluted earnings
 per ordinary share pre APB25 charge of 10.7 cents or 32.1 cents per ADS, up
 46% (Q1 2000: 7.3 cents per ordinary share or 22.0 cents per ADS).  Net income
 (after APB25 charge of $2.1 million) was $26.0 million (Q1 2000: $4.3 million
 net loss after APB25 charge of $23.2 million).
 
     Sales and marketing
     Product sales, at $151.4 million, increased by 34% over Q1 2000.  Sales of
 Adderall* were $70.1 million, representing growth of 29% on the comparative
 period in 2000, which included some stock-building by wholesalers ahead of
 anticipated price increases.  Adderall* had a 33.3% share of the prescription
 market for Attention Deficit Hyperactivity Disorder (ADHD) in the US in March
 2001 (March 2000: 29.7%) and continues to be the brand leader in the US market
 for ADHD.
     Sales of Agrylin*, the only US product licensed for the treatment of
 thrombocythaemia, were $17.1 million, a 56% increase on Q1 2000 sales of
 $11.0 million, when sales were slightly below trend due to wholesaler de-
 stocking. Shire achieved a prescription share of 20.4% of the total US
 Agrylin, Hydrea and generic hydroxyurea market in March 2001, compared to
 14.3% for the month of March 2000.
     Sales of Pentasa*, for the treatment of ulcerative colitis, were
 $14.4 million, 39% higher than the comparable period last year, when sales
 were below trend due to wholesaler de-stocking following a price increase in
 Q4 1999. Pentasa* had a prescription share of 17.8% of the US oral
 mesalamine/olsalazine market in March 2001, compared to 18.0% in March 2000.
     Sales of ProAmatine*, for the treatment of postural hypotension, were
 $7.6 million, 112% higher than Q1 2000 sales of $3.6 million, when sales were
 also below trend due to wholesaler de-stocking following a price increase in
 Q4 1999. The US prescription market for ProAmatine* and Florinef prescriptions
 indicates that ProAmatine* had a 22.1% share for the month of March 2001, an
 increase from 19.5% in March 2000.
     Carbatrol*, containing carbamazepine, recorded sales growth of 72% from
 sales of $5.6 million in Q1 2000 to $9.6 million in Q1 2001. This translates
 to 32.5% of the US extended release carbamazepine prescription market in March
 2001, compared to 26.0% in March 2000.
 
     Licensing
     Licensing and development fees in the first quarter fell by 38% to
 $3.0 million (Q1 2000: $4.9 million) and included one-time receipts of third
 party milestone payments in respect of Reminyl* Food and Drug Administration
 (FDA) approval and SLI drug delivery contracts. The quarter on quarter
 decrease is mainly due to the reduction in development stage activities for
 Reminyl* and hence the ending of reimbursement revenues for actual costs
 incurred on bulb-related raw material.   Royalties increased by $0.3 million
 to $0.9 million (Q1 2000: $0.6 million).
 
     Cost of sales and operating expenses
     Gross margin on product sales, at 82%, was consistent with Q1 2000. The
 higher margin products, particularly Adderall* and Agrylin* represented
 approximately 57% of total product sales in Q1 2001, also consistent with Q1
 2000.
     R&D expenditure for the first quarter increased by 4% to $27.2 million.
 Expressed as a percentage of revenues, R&D expenditure was 17% in Q1 2001
 compared to 22% in Q1 2000 and 21% for full year 2000. R&D expenditure was
 particularly high in Q1 2000 due to the upfront payment for the in-licensing
 of SPD 421 from D-Pharm. The relatively low R&D to revenue ratio in Q1 2001 is
 mainly related to phasing of project costs resulting in lower than usual costs
 during the quarter.
     Selling, general and administrative (S,G&A) expenses, excluding the
 effects of an APB25 charge, increased by 41% to $49.5 million (Q1 2000:
 $35.2 million). As a percentage of product sales S,G&A expenses increased by
 2% to 33%. This increase reflects the growth in the US sales force since Q1
 2000 and increased marketing activities in respect of the anticipated Adderall
 XR* launch.
     The APB25 charge for the quarter was $2.1 million. This substantial
 reduction compared to the Q1 2000 charge of $23.2 million reflects minor
 amendments to the executive share option scheme effective from March 2000.
     Depreciation and amortization increased by 13% to $8.6 million (Q1 2000:
 $7.6 million). This increase is attributable to the purchase of several new
 products since March last year.
 
     Taxation
     The effective rate of tax on the profits for the quarter pre APB25 is 30%
 (Q1 2000: 29%). The company has recorded net deferred tax assets of
 approximately $26.8 million.
 
     Cash flow
     Net cash inflow from operating activities of $58.0 million provided
 funding for two product acquisitions in Europe ($18.3 million) and tangible
 fixed asset additions of $1.5 million. Cash inflow from financing activities
 of $2.1 million related to employee stock option exercises.
     Cash, cash equivalents, marketable securities and other current assets at
 31 March 2001 amounted to $225.4 million. After deduction of borrowings this
 gives a net cash position of $97.5 million.
 
 
     PROJECTS UNDER DEVELOPMENT
 
     Central nervous system disorders
 
     Alzheimer's disease
     Reminyl* was launched in the UK in September 2000. In January 2001, the UK
 National Institute of Clinical Excellence (NICE) announced that treatments for
 Alzheimer's disease should be made available as part of the management of
 patients with mild to moderate Alzheimer's disease within the UK. This was
 followed on 28 February 2001 by approval from the Food and Drug Administration
 (FDA) for Reminyl* in the US. Janssen Pharmaceutica and Ortho-McNeil
 Pharmaceutical will be marketing Reminyl* in this market and intend to make
 the product available on prescription from May 2001.
     By 31 March 2001, Reminyl* had been launched in 11 countries, including
 the UK and Ireland.  A number of further launches are planned over the coming
 months.
 
     ADHD
     New pivotal data on the once daily formulation of Adderall*, SLI 381,
 under development for the treatment of ADHD, have been accepted as a platform
 presentation at the annual meeting of the American Psychiatric Association
 (APA). The oral presentation of safety and efficacy results will take place on
 Wednesday, 9 May, at 11:00 am at the APA's 2001 annual meeting in New Orleans,
 at which point Shire will publish the relevant posters. The once daily
 medication, currently known by its project designation, SLI 381 (proposed
 Trade Mark Adderall XR), is a novel formulation of Adderall* (mixed salts of a
 single-entity amphetamine product) that incorporates Shire's Microtrol(TM)
 advanced drug delivery system.
 
     Oncology/haematology
 
     Thrombocythaemia
     On 3 January 2001, Shire announced that the European Commission had
 granted orphan drug designation to anagrelide for the treatment of essential
 thrombocythaemia. This designation covers the EU, plus Norway and Iceland, and
 provides up to 10 years market exclusivity for the product following Marketing
 Authorization Approval. Orphan drug status already applies to anagrelide in
 the US, where the product is marketed as Agrylin*, and in Japan where it will
 run for 10 years following marketing approval.
 
     Metabolic diseases
 
     Hyperphosphataemia
     The first regulatory submission for Foznol* (lanthanum carbonate) was
 delivered to a Reference Member State in the EU Mutual Recognition Procedure
 on 13 March 2001.  Foznol is being developed for the treatment of
 hyperphosphataemia in patients with chronic renal failure.
 
     Future Prospects
     In respect of the proposed merger with BioChem Pharma Inc, although the
 current review period with Industry Canada expires on 27 April 2001, Shire
 requested an extension on 25 April 2001.
     Discussions with Industry Canada are ongoing and Shire remains firmly
 committed to obtaining the Canadian Minister of Industry's approval for the
 proposed merger with BioChem Pharma Inc.
     Progress towards the launch of Adderall XR* continues and this will lead
 to ongoing marketing expenditure. R&D expenditure as a percentage of revenue
 is expected to move back towards historic ranges in subsequent quarters.
     With the forthcoming US launch of Reminyl* expected and the recent
 regulatory filing for Foznol* in Europe, management remains confident about
 the company's future growth prospects.
 
    * Trade Mark
 
 
     Unaudited consolidated balance sheets
     US GAAP
 
                                                   31.03.2001     31.03.2000
                                                     $'000          $'000
     ASSETS
     Current assets:
     Cash and cash equivalents                         82,835         67,307
     Marketable securities and other
      current asset investments                       142,553         58,020
     Accounts receivable, net                          70,993         75,689
     Inventories, net                                  43,773         39,828
     Deferred tax asset                                18,722          5,312
     Prepaid expenses and other current assets         14,373          6,211
 
     Total current assets                             373,249        252,367
 
     Investments                                        5,756          2,604
     Property, plant and equipment, net                47,867         38,813
     Intangible assets, net                           561,458        550,536
     Deferred tax asset                                 8,047         31,799
     Other assets                                      21,850          5,058
 
     Total assets                                   1,018,227        881,177
 
     LIABILITIES AND SHAREHOLDERS' EQUITY
     Current liabilities:
     Current installments of long-term debt             1,470          5,333
     Accounts and notes payable                        97,313        106,695
     Other current liabilities                         19,765          9,214
 
     Total current liabilities                        118,548        121,242
 
     Long-term debt, excluding current installments   126,436        128,040
 
     Other long-term liabilities                       11,532            541
 
     Total liabilities                                256,516        249,823
 
     Shareholders' equity:
     Common stock, 5p par value; 400,000,000(2000:
      400,000,000) shares authorized; and
      257,950,135 (2000: 251,376,841) shares issued
      and outstanding respectively                     21,097         20,611
     Additional paid-in capital                       945,735        883,257
     Accumulated other comprehensive losses          (52,121)       (13,122)
     Accumulated deficit                            (153,000)      (259,392)
 
     Total shareholders' equity                       761,711        631,354
 
     Total liabilities and shareholders' equity     1,018,227        881,177
 
 
     Unaudited consolidated income statements
     US GAAP
 
                                                   3 months          3 months
                                                  to 31.03.01      to 31.03.00
                                                     $'000            $'000
 
     Total revenues                                   155,641        118,978
     Cost of revenues                                 (27,713)       (20,905)
 
     Gross profit                                     127,928         98,073
 
     Operating expenses                               (88,010)       (92,118)
 
     Operating income                                  39,918          5,955
 
     Interest income                                    2,536          1,371
     Interest expense                                  (2,801)        (3,405)
     Other expense                                     (1,668)          (431)
 
     Total other expenses                              (1,933)        (2,465)
 
     Income before income taxes                        37,985          3,490
 
     Income taxes                                     (12,030)        (7,756)
 
     Net income/(loss) - see below                     25,955         (4,266)
 
     Net income/(loss) per share:
     Basic                                              10.1c         (1.7)c
     Diluted                                             9.9c         (1.7)c
 
     Weighted average number of shares:
     Basic                                        257,390,769    246,672,276
     Diluted                                      262,649,651    246,672,276
 
 
     Supplemental information
 
     Net income/(loss) as above                        25,955         (4,266)
     Add back:
     APB25 stock option compensation charge             2,121         23,246
 
     Net income before APB25                           28,076         18,980
 
     Net income before APB25
      per ordinary share
     Basic                                              10.9c           7.7c
     Diluted                                            10.7c           7.3c
 
     Net income before APB25 per ADS
     Basic                                              32.7c          23.1c
     Diluted                                            32.1c          22.0c
 
     The diluted net income before APB25 per ordinary share uses the fully
     diluted weighted average number of shares of 259,301,631. This is not used
     when the result is a net loss because it would have an anti-dilutive
     effect.
 
 
     Unaudited consolidated statements of cash flows
     US GAAP
 
                                                     3 months        3 months
                                                    to 31.03.01    to 31.03.00
                                                       $'000          $'000
 
     Cash flows from operating activities:
     Net income/(loss)                                 25,955         (4,266)
     Adjustments to reconcile net income/(loss)
      to net cash provided by/(used
      in) operating activities:
 
     Depreciation and amortization                      8,600          7,592
     Stock option compensation                          2,121         23,246
     Tax benefit of stock option compensation,
      charged directly to equity                        3,090          1,072
     Non cash exchange gains and losses               (10,311)          (151)
     Loss on disposal of fixed assets                     607              -
     Decrease/(increase) in inventory                   3,336           (290)
     Decrease in deferred tax asset                     6,500              -
     Decrease/(increase) in accounts receivable        18,816        (14,410)
     Decrease in accounts payable                        (668)       (48,556)
 
     Net cash provided by/(used in)
       operating activities                            58,046        (35,763)
 
     Cash flows from investing activities:
     Redemption of marketable securities, net          46,000         31,687
     Increase in cash placed on short-term deposit    (48,808)        (5,363)
     Expenses of acquisition of subsidiaries                -           (212)
     Purchase of intangible fixed assets              (18,335)             -
     Purchase of fixed assets                          (1,544)        (1,935)
     Collection on notes receivable                         -            520
 
     Net cash (used in)/provided by investing
       activities                                     (22,687)        24,697
 
 
     Cash flows from financing activities:
     Movements on long term debt                           94         (2,549)
     Proceeds from issue of common stock                    -          3,033
     Payment of stock issuance costs                      (16)        (3,385)
     Proceeds from exercise of options                  2,109         27,192
 
     Net cash provided by financing activities          2,187         24,291
 
     Effect of foreign exchange rate changes
      on cash and cash equivalents                     (1,309)             -
 
     Net increase in cash and cash equivalents         36,237         13,225
     Cash and cash equivalents at beginning of period  46,598         54,082
 
     Cash and cash equivalents at end of period        82,835         67,307
 
 
     NOTES
 
     1.    Analysis of revenue, operating income and reportable segments
 
           The company has disclosed segmental information for the individual
           operating areas of the business, based on the way in which the
           business is managed and controlled. Shire's principal reporting
           segments are geographic, each being managed and monitored separately
           and serving different markets. The company evaluates performance
           based on operating income or loss before interest and income taxes.
 
 
     Three months to March 31, 2001
                                                       Rest of
                              US          Europe        World         Total
                             $'000        $'000         $'000         $'000
 
     Product sales          126,804        18,330        6,270       151,404
     Licensing and
      development             2,085           956            -         3,041
     Royalties                   60           358          503           921
     Other revenues               -             -          275           275
 
     Total revenue          128,949        19,644        7,048       155,641
 
 
     Cost of revenues        17,877         6,529        3,307        27,713
     Research and
      development            19,916         7,188           61        27,165
     Selling, general
      and administrative     35,815        14,027        1,796        51,638
     Losses on disposal of
      assets                    591            14            2           607
 
     Total operating
      expenses               74,199        27,758        5,166       107,123
 
     EBITDA                  54,750        (8,114)       1,882        48,518
     Depreciation and
      amortization           (4,460)       (4,135)          (5)       (8,600)
 
     Operating income/(loss) 50,290       (12,249)       1,877        39,918
 
 
     Three months to March 31, 2000
                                                       Rest of
                              US          Europe        World         Total
                             $'000        $'000         $'000         $'000
 
     Product sales           93,102        15,243        4,820       113,165
     Licensing and
      development             1,376         3,534            -         4,910
     Royalties                   44           561            -           605
     Other revenues               3             -          295           298
 
     Total revenue           94,525        19,338        5,115       118,978
 
     Cost of revenues        12,955         5,730        2,220        20,905
     Research and
      development            17,247         8,808           17        26,072
     Selling, general
      and administrative     22,420        34,107        1,927        58,454
 
     Total operating
      expenses               52,622        48,645        4,164       105,431
 
     EBITDA                  41,903       (29,307)         951        13,547
     Depreciation and
      amortization           (3,718)       (3,688)        (186)       (7,592)
 
     Operating income/(loss) 38,185       (32,995)         765         5,955
 
 
     2.    Net income/(loss) per share
 
           Basic net income/(loss) per share is based upon the net
           income/(loss) available to common stockholders divided by the
           weighted average number of common shares outstanding during the
           period. Diluted net income/(loss) per share is based upon income
           available to common stockholders divided by the weighted average
           number of common shares outstanding during the period and adjusted
           for the effect of all dilutive potential common shares that were
           outstanding during the period.
 
     The following table sets forth the computation for basic and diluted net
     income/(loss) per share:
 
 
                                                    3 months          3 months
                                                  to 31.03.01       to 31.03.00
                                                      $'000            $'000
 
     Numerator for basic net income per share         25,955          (4,266)
     Interest on convertible debt, net of tax             44               -
 
     Numerator for diluted net income per share       25,999          (4,266)
 
 
                                                No. of shares    No. of shares
 
     Weighted average number of shares:
     Basic                                        257,390,769    246,672,276
     Effect of dilutive stock options               4,666,975              -
     Convertible debt                                 591,907              -
 
     Diluted                                      262,649,651    246,672,276
 
     Basic net income per share                         10.1c         (1.7)c
 
     Diluted net income per share                        9.9c         (1.7)c
 
 
     3.  Net product sales data
 
                            3 months     3 months      3 months      3 months
                          to 31.03.01   to 31.03.00   to 31.03.01  to 31.03.01
                             $'000        $'000        % increase   % of total
 
     Adderall*               70,146        54,539         +29%           46%
     Agrylin*                17,146        11,005         +56%           11%
     Pentasa*                14,400        10,347         +39%           10%
     Carbatrol*               9,639         5,592         +72%            6%
     Calciums                 4,795         3,985         +20%            3%
     ProAmatine*              7,577         3,575        +112%            5%
     DextroStat*              1,628         2,312         -30%            1%
     OTC                      7,325         5,801         +26%            5%
     Others                  18,748        16,009         +17%           13%
 
                            151,404       113,165          34%          100%
 
 
     * Trade Mark
 
 
     Unaudited consolidated profit and loss accounts
     UK GAAP
 
                                                  3 months       3 months
                                                to 31.03.01    to 31.03.00
                                            (pounds sterling) (pounds sterling)
                                                   '000             '000
 
     Turnover                                      108,115         74,471
     Cost of sales                                 (28,931)       (14,038)
 
     Gross profit                                   79,184         60,433
 
     Other operating expenses                      (54,359)       (46,298)
 
     Operating profit                               24,825         14,135
 
     Finance charges, net                           (6,450)        (1,247)
 
     Profit on ordinary activities before taxation  18,375         12,888
 
     Taxation                                       (1,744)        (4,175)
 
     Profit on ordinary activities after taxation   16,631          8,713
 
     Earnings per share
     - basic                                           6.5p           3.5p
     - diluted                                         6.3p           3.4p
 
 
     All results included above relate to the continuing operations of the
     Group.
 
     Unaudited consolidated statement of total recognized gains and losses
 
 
                                                 3 months       3 months
                                                to 31.03.01    to 31.03.00
                                            (pounds sterling) (pounds sterling)
                                                   '000             '000
 
     Profit for the period                         16,631          8,713
     Translation of overseas subsidiaries'
      financial statements                         13,336          1,832
 
     Total recognized gains and losses
      relating to the period                       29,967         10,545
 
 
     Unaudited consolidated balance sheets
     UKGAAP
 
 
                                                  31.03.01       31.03.00
                                            (pounds sterling) (pounds sterling)
                                                   '000             '000
     Fixed assets
     Goodwill                                      441,105        463,825
     Other intangible assets                       271,846        215,445
     Tangible assets                                33,669         24,330
     Fixed asset investments                         4,230          1,632
 
                                                   750,850        705,232
 
     Current assets
     Stocks                                         30,789         24,966
     Debtors
     - due within one year                          60,056         54,508
     - due after one year                           15,369              -
     Investments                                   100,269         36,369
     Cash at bank and in hand                       58,265         42,191
                                                   264,748        158,034
     Creditors: amounts falling due
      within one year                              (83,415)       (76,078)
 
     Net current assets                            181,333         81,956
 
     Total assets less current liabilities         932,183        787,188
     Creditors: amounts falling due in more
      than one year                                (97,125)       (80,574)
 
     Net assets                                    835,058        706,614
 
     Capital and reserves
     Called-up share capital                        12,898         12,569
     Share premium                                 874,971        855,465
     Capital reserve                                 2,755          2,755
     Other reserves                                 24,247         24,247
     Profit and loss account                       (79,813)      (188,422)
 
     Equity shareholders' funds                    835,058        706,614
 
     Basis of preparation
     The accounts have been prepared in accordance with the accounting policies
 set out in the full UK statutory accounts for the year ended December 31,
 2000. The results for the three months ended March 31, 2001 and 2000 have not
 been audited and do not constitute statutory accounts within the meaning of
 Section 240 of the Companies Act 1985.
 
     Summary of significant differences between US generally accepted
 accounting principles followed by the Group and UK generally accepted
 accounting principles
 
     The Group's consolidated financial statements have been prepared under US
 GAAP, which differs in certain respects from UK GAAP. The principal
 differences between the Group's accounting policies under US GAAP and UK GAAP
 are set out in the tables below:
 
     Reconciliation of net income from US GAAP to UK GAAP
 
 
                               3 months    3 months     3 months     3 months
                             to 31.03.01  to 31.03.00  to 31.03.01  to 31.03.00
                                $'000        $'000         (pounds sterling)
                                                          '000         '000
 
     Net income/(loss) as
       reported under US GAAP   25,955       (4,266)      17,853     (2,661)
 
     Adjustments to conform
      to UK GAAP:
       Merger accounting
        adjustments
        - restructuring costs
          charged to income        (60)         (60)         (42)       (36)
     Amortization of capitalized
      goodwill                   2,451        2,715        1,698      1,699
     Amortization under
      acquisition accounting    (8,237)      (9,120)      (5,706)    (5,706)
     Derecognition of deferred
      tax asset                  6,500            -        4,573          -
     Stock option compensation
      costs                      2,121       23,246        1,444     14,522
     Tax benefit from exercise
      of non-qualified stock
      options                    3,090        1,072        1,959        673
     Difference in accounting
      for convertible debt          (1)         354           (1)       222
     Accrued taxes on share
       options                      10            -            7          -
     Foreign exchange on US$
      denominated liabilities        -            -       (5,154)         -
 
     Net income as reported
      under UK GAAP             31,829       13,941       16,631      8,713
 
     Reconciliation of total shareholders' equity from US GAAP to UK GAAP
 
 
                                3 months    3 months     3 months     3 months
                                 $'000        $'000        (pounds sterling)
                                                          '000         '000
 
     Total shareholders' equity
      as reported under US GAAP  761,711     631,354     535,777      395,760
     Adjustments to conform to
      UK GAAP:
       Merger accounting
        adjustments - restructuring
        costs charged to income      110         350          77          218
     Goodwill written off to
      reserves                  (191,215)   (214,561)   (134,497)    (134,496)
     Goodwill amortization        35,148      28,604      24,723       17,930
     Net book value of goodwill
      on acquisition accounting
      for Roberts Pharmaceutical
      Corporation                607,605     718,271     427,386      450,243
     Deferred tax                (26,769)    (37,111)    (18,830)     (23,263)
     Difference in accounting
      for convertible debt           464         354         327          222
     Difference in valuation of
      fixed asset investments        258           -         181            -
     Accrued taxes on share
      options                       (123)          -         (86)           -
 
     Total shareholders' equity
      as reported under
      UK GAAP                  1,187,189   1,127,261     835,058      706,614
 
 
     Earnings per share per UK adjusted results
     Earnings per share has been calculated by dividing the profit on ordinary
 activities after taxation for each period by the weighted average number of
 shares in issue during those periods, in accordance with FRS14.
     The weighted average number of shares used in calculating fully diluted
 earnings per share has been adjusted for the effects of all dilutive potential
 ordinary shares in accordance with FRS14.
 
 
                                                 3 months      3 months
                                                to 31.03.01   to 31.03.00
                                                  (pounds sterling '000)
 
     Profit for the period
      (for basic and diluted EPS)                  16,631        8,713
 
     Weighted average number of shares in
      issue for basic EPS                     257,390,769  246,672,276
     Number of dilutive potential shares        5,258,882   12,629,355
 
     Total for fully diluted EPS              262,649,651  259,301,631
 
 
     a) Results stated after APB25 charge are as set out in Shire's
        consolidated income statement on page 9
 
     b) Prescription market (IMS) March 2001
 
     *Trade Mark
 
 
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 SOURCE  Shire Pharmaceuticals Group plc