SHIRE PLC
SHIRE to Combine With BAXALTA, Creating THE GLOBAL Leader in Rare Diseases
Combination creates leading global biotechnology company projected to deliver
double-digit top-line growth with over $20 billion in annual revenues by 2020
* No. 1 platform in rare diseases expected to generate 65% of total annual
revenues
* Multiple, durable billion-dollar franchises, each with best-in-class
products
* Robust portfolio includes over 30 recent and planned product launches with
$5 billion sales potential by 2020
* Efficient structure expected to yield annual operating cost synergies of
over $500 million, with additional revenue synergies and a combined
non-GAAP effective tax rate of 16-17%
* Accretion to non-GAAP diluted EPS anticipated in 2017, the first full
calendar year of ownership, and beyond
* Attractive ROIC expected to exceed Shire's cost of capital in 2020
* Wayne T. Hockmeyer, Baxalta's Chairman, expected to become Deputy Chairman,
and two additional Directors to be included from the Baxalta Board
Dublin, Ireland and Bannockburn, Illinois - January 11, 2016 - Shire plc (LSE:
SHP, NASDAQ: SHPG) and Baxalta Incorporated (NYSE: BXLT) today announced that
the boards of directors of both companies have reached an agreement under which
Shire will combine with Baxalta. Under the agreement, Baxalta shareholders will
receive $18.00 in cash and 0.1482 Shire ADS per Baxalta share. Based on
Shire's closing ADS price on January 8, 2016, this implies a total current
value of $45.57 per Baxalta share, representing an aggregate consideration of
approximately $32 billion. The exchange ratio is based on Shire's 30-day
trading day volume weighted average ADS price of $199.03 as of January 8, 2016,
which implies a total value of $47.50 per Baxalta share.
The value of the offer, as of Shire's January 8, 2016 closing ADS price,
represents a premium of approximately 37.5% to Baxalta's unaffected share price
on August 3, 2015, the day prior to the public announcement of Shire's initial
offer for Baxalta. This will provide Baxalta shareholders with approximately
34% ownership in the combined company. The parties expect the transaction to
close mid-2016.
Shire Chief Executive Officer Flemming Ornskov, M.D., M.P.H., commented:
"This proposed combination allows us to realize our vision of building the
leading biotechnology company focused on rare diseases. Together, we will have
leadership positions in multiple, high-value franchises and become the clear
partner of choice in rare diseases. Our expanded portfolio and presence in more
than 100 countries will drive our growth to over $20 billion in anticipated
annual revenues by 2020. Our due diligence has reinforced our belief in the
combination, and we look forward to welcoming Baxalta colleagues to a shared
entrepreneurial, patient-driven culture."
Susan Kilsby, Chairman of Shire, commented:
"Together, Shire and Baxalta create a platform for sustainable innovation,
growth and value creation. Shire is an experienced and disciplined acquirer
with a track record of delivering shareholder value. Stakeholders of both
companies are expected to benefit from the enhanced growth prospects, superior
operational scale and efficiency and the strong financial and organizational
profile of the combined entity."
Baxalta Chief Executive Officer Ludwig N. Hantson, Ph.D., commented:
"Today's announcement marks a new path forward for our organization and is a
testament to the significant progress we have made in achieving our strategic
business priorities. This transaction presents a unique opportunity for Baxalta
shareholders, who will receive substantial immediate value as well as an
ongoing stake in a combined global leader in rare diseases with strong growth
prospects. We bring to Shire a strong portfolio and pipeline of market-leading
products, high-quality manufacturing capabilities and a talented global
workforce that places patients at the center of everything we do. The combined
organization will be well positioned to accelerate innovation and deliver
enhanced value for all stakeholders."
Wayne T. Hockmeyer, Ph.D., Chairman of Baxalta, commented:
"We launched Baxalta to focus on purpose-driven performance, sustainable
growth, and continuing our leadership in developing treatments for orphan and
underserved diseases. While we have made great progress to date and have had a
measurable impact across all our businesses, I look forward to joining the
board of the combined company to help ensure that we infuse the best of both
organizations and foster a new shared culture that has the resources, the
passion, and the commitment to continue to make a meaningful difference in the
lives of our patients and their families."
Baxter International Chairman and Chief Executive Officer José E. Almeida
commented:
"Baxter fully supports the proposed combination of Shire and Baxalta, which
will create a major biotechnology company and global leader in rare
diseases. Baxter is pleased to support this value enhancing transaction."
Shire will host a conference call for investors and analysts today, January 11,
2016 at 1:30 p.m. GMT / 8:30 a.m. EST / 5:30 a.m. PST. (Details below)
Combination Creates the Global Leader in Rare Diseases with a Sustainable
Platform for Future Innovation, Growth and Value Creation
The combination of Baxalta and Shire will create the number one rare diseases
platform in revenue and pipeline depth, with best-in-class products in each of
the following growing, multi-billion-dollar franchises: Hematology; Immunology;
Neuroscience; Lysosomal Storage Diseases; Gastrointestinal / Endocrine; and
Hereditary Angioedema (HAE). The combined company will also possess a growing
franchise in Oncology, with approved products and innovative compounds in
development, as well as a robust late-stage Ophthalmics pipeline.
The combined portfolio will have an expanded range of therapeutic areas with
more than 60 programs in development, including over 50 that will address rare
diseases and the newly-approved Baxalta products ADYNOVATE, VONVENDI and
OBIZUR. Shire anticipates more than 30 recent and planned product launches from
the combined pipeline, contributing approximately $5 billion in annual revenues
by 2020.
Further, the combined company will benefit from expanded geographic reach
across more than 100 countries, with a high-quality commercial organization and
world-class manufacturing operations. Through a balanced portfolio and expanded
therapeutic expertise and capabilities, the combination will enhance revenue
diversification and optionality for the business, while strong cash flows will
increase financial and operational scale. In total, the proposed combination
will create a sustainable platform for future innovation and growth, yielding
projected near- and long-term value for shareholders.
Leading Franchises, Each with Best-in-Class Products and a Foundation for
Sustained Category Leadership in Rare Diseases
The portfolio will include over 20 leading brands and a robust pipeline of
expected new product launches with complementary positions across growing
multi-billion-dollar franchises:
Hematology
* Baxalta has a well-established hematology portfolio based on its heritage
and legacy of leadership in hemophilia. Baxalta offers a comprehensive
portfolio of innovative therapeutics, including ADYNOVATE, Antihemophilic
Factor (Recombinant), PEGylated, an extended circulating half-life
recombinant factor VIII (rFVIII) treatment for hemophilia A which was
recently approved in the U.S., and is focused on introducing new treatments
for hemophilia and other rare chronic bleeding disorders to further reduce
patient burdens
Immunology
* Baxalta is contributing the broadest portfolio of immunoglobulin (IG)
products in the industry, most notably the recently launched HYQVIA, a next
generation subcutaneous IG treatment for patients with primary
immunodeficiency, as well as a pipeline of innovative products across a
broad range of potential new indications
Neuroscience
* Shire has over 20 years of experience in neuroscience with a strong,
growing ADHD franchise and pipeline, including a new VYVANSE indication for
adults with moderate-to-severe Binge Eating Disorder
Lysosomal Storage Diseases
* Shire brings industry-leading capabilities in the development and
commercialization of a wide range of therapies for multiple rare and
devastating genetic diseases including: VPRIV for long-term enzyme
replacement therapy (ERT) for patients with type 1 Gaucher disease;
ELAPRASE for patients with Hunter syndrome (Mucopolysaccharidosis II, MPS
II); and REPLAGAL for long-term ERT in patients with a confirmed diagnosis
of Fabry disease
Gastrointestinal / Endocrine
* Shire's Gastrointestinal / Endocrine portfolio is built on the strength of
its 5-ASA products, LIALDA, for the treatment of mild to moderate
ulcerative colitis, and PENTASA, for the treatment of mildly to moderately
active ulcerative colitis, and recent additions of GATTEX/REVESTIVE, for
adults with short bowel syndrome who are dependent on parenteral support,
and NATPARA, as an adjunct to calcium and vitamin D to control hypocalcemia
in patients with hypoparathyroidism
HAE
* Shire brings HAE leadership through its currently approved prophylactic and
acute therapies, CINRYZE and FIRAZYR, respectively, and-pending completion
of the Dyax acquisition-a Phase 3, potentially transformative prophylactic
therapy
Ophthalmics
* Shire is focused on building franchise leadership in ophthalmology with the
2016 projected launch of Lifitegrast, contingent upon regulatory approval,
for dry eye disease; SHP640 for infectious conjunctivitis entering Phase 3
trials in 2016, and SHP607 for the treatment of retinopathy of prematurity,
generating results from its Phase 2 trials which are expected in 2016
Oncology
* Baxalta brings a growing oncology business and a broad platform that
positions the combined company at the leading-edge of discovery and
development of innovative therapies in hematological and other cancers. The
portfolio includes ONCASPAR (pegaspargase), a marketed biologic treatment
for acute lymphocytic leukemia, and late-stage, partnered products such as
pacritinib, an investigational oral kinase inhibitor for the treatment of
patients with myelofibrosis, and ONIVYDE (irinotecan liposome injection)
for the treatment of patients with metastatic pancreatic cancer
Financial Highlights
Shire anticipates that it will realize more than $500 million in annual cost
synergies (expected to be achieved within the first three years post-closing).
These annual cost synergies will be achieved by increasing efficiencies,
leveraging the scale of the combined business, aligning to Shire's lean
operating model and optimizing the combined R&D portfolio. Further, Shire
expects to generate additional revenue synergies and a combined non-GAAP
effective tax rate of 16-17% by 2017. Growth is expected to be accelerated by
combining capabilities and establishing a global infrastructure that will
include a "best of both" commercial model and a presence in over 100 global
markets.
The transaction is expected to be accretive to non-GAAP diluted EPS in 2017,
the first calendar year of ownership, and beyond. The combined company is
expected to generate annual operating cash flow of $6.0 billion beginning in
2018, underpinning an attractive ROIC that will exceed Shire's cost of capital
in 2020.
Shire has conducted additional tax due diligence, and based on this diligence,
Shire and its tax advisor have concluded that a merger with the proposed cash
consideration of $18 per Baxalta share will maintain the tax-free status of the
Baxalta spinoff from Baxter.
Shire has secured an $18 billion fully underwritten bank facility to finance
the combination. The new bank facility has a one year life, with a one-year
extension available at Shire's option. Shire intends to refinance the bank
facility through capital market debt issuances in due course. The financing of
the transaction has been structured with the intention of maintaining an
investment grade credit rating for the combined entity. Shire is committed to
de-levering rapidly post-close by deploying free cash flow to repay debt. Shire
is targeting a net debt to EBITDA range of between 2.0x and 3.0x 12-18 months
post-closing.
Transaction Details
Under the agreement, Baxalta shareholders will receive $18.00 in cash and
0.1482 Shire ADS per Baxalta share. Based on Shire's closing ADS price on
January 8, 2016, this implies a total current value of $45.57 per Baxalta
share, representing an aggregate consideration of approximately $32 billion.
The exchange ratio is based on Shire's 30-day trading day volume weighted
average ADS price of $199.03 as of January 8, 2016, which implies a total value
of $47.50 per Baxalta share.
The value of the offer as of Shire's January 8, 2016 closing ADS price
represents a premium of approximately 37.5% to Baxalta's unaffected share price
on August 3, 2015, the day prior to the public announcement of Shire's initial
offer for Baxalta. This will provide Baxalta shareholders with approximately
34% ownership in the combined company.
Closing
The transaction has been approved by the boards of directors of both Shire and
Baxalta. Closing of the transaction is subject to approval by Baxalta and Shire
shareholders, certain regulatory approvals, redelivery of tax opinions
delivered at signing and other customary closing conditions. The transaction is
a class 1 transaction for Shire for the purposes of the UK Listing Rules
requiring the approval of Shire shareholders. A shareholder circular, together
with notice of the relevant shareholder meeting, will be distributed to Shire
shareholders in due course. The parties expect the transaction to close
mid-2016.
Live Conference Call for Investors
Shire's Flemming Ornskov, M.D., M.P.H., Chief Executive Officer and Jeff
Poulton, Chief Financial Officer will host a conference call for investors and
analysts today, January 11, 2016 at 8:30 a.m., Eastern U.S. Time (1:30 p.m.,
Greenwich Mean Time). They will be joined for the Q&A by Baxalta's Ludwig
Hantson, Ph.D., President and CEO, and Brian Goff, Head of Hematology, and Mark
Enyedy, Shire's Head of Corporate Development.
UK dial in: 0808 237 0030 or 020 3139 4830
US dial in: 1 866 928 7517 or 1 718 873 9077
Password/Conf ID: 43211523#
Live Webcast: Click here
URL for international dial in Click here
numbers:
About Shire
Shire enables people with life-altering conditions to lead better lives.
Shire's strategy is to focus on developing and marketing innovative specialty
medicines to meet significant unmet patient needs.
Shire's focus is on providing treatments in Rare Diseases, Neuroscience,
Gastrointestinal and Internal Medicine and we are developing treatments for
symptomatic conditions treated by specialist physicians in other targeted
therapeutic areas, such as Ophthalmics.
www.shire.com
About Baxalta
Baxalta Incorporated (NYSE: BXLT) is a $6 billion global biopharmaceutical
leader developing, manufacturing and commercializing therapies for orphan
diseases and underserved conditions in hematology, oncology and immunology.
Driven by passion to make a meaningful impact on patients' lives, Baxalta's
broad and diverse pipeline includes biologics with novel mechanisms and
advanced technology platforms such as gene therapy. The Baxalta Global
Innovation and R&D Center is located in Cambridge, Massachusetts. Launched in
2015 following separation from Baxter International, Baxalta's heritage in
biopharmaceuticals spans decades. Baxalta's therapies are available in more
than 100 countries and it has advanced biological manufacturing operations
across 12 facilities, including state-of-the-art recombinant production and
plasma fractionation. Headquartered in Northern Illinois, Baxalta employs
16,000 employees worldwide.
The total assets of Baxalta as at 31 December 2014 amounted to US$8.8 billion.
For the year ended 31 December 2014, GAAP pre-tax income from continuing
operations amounted to US$1.5 billion and adjusted pro forma EBITDA amounted to
US$2.2 billion. The total assets of Baxalta as at 30 September 2015 amounted
to US$12.9 billion. For the nine months ended 30 September 2015, GAAP pre-tax
income from continuing operations amounted to US$1.1 billion and adjusted pro
forma EBITDA amounted to US$1.6 billion.
Adjusted pro forma EBITDA for the year ended 31 December 2014 represents GAAP
pre-tax income from continuing operations excluding depreciation and
amortization expense of US$206 million and other expense of US$104 million, and
as adjusted for other special items and pro forma adjustments (related to the
separation from Baxter) totaling US$363 million. Adjusted pro forma EBITDA for
the nine months ended 30 September 2015 represents GAAP pre-tax income from
continuing operations excluding depreciation and amortization expense of US$187
million, interest expense of US$26 million and other income of US$87 million,
and as adjusted for other special items and pro forma adjustments (related to
the separation from Baxter) totaling US$376 million. Refer to Baxalta's
earnings press releases that have been furnished as Exhibit 99.1 to Baxalta's
Current Report on Form 8-K filed with the SEC on both July 30, 2015 and October
29, 2015 for additional information.
www.baxalta.com
FOR FURTHER INFORMATION PLEASE CONTACT:
FOR SHIRE
Investor Relations
Matthew Osborne mattosborne@shire.com +1 781 482-9902
Sarah Elton-Farr seltonfarr@shire.com +44 1256 894157
Corporate Brokers
Peter Moorhouse peter.moorhouse@morganstanley.com +44 207 677 2396
Ben Lawrence ben.lawrence@db.com +44 207 547 4583
Media
Michele Galen mgalen@shire.com +1 781 482-1867
Jessica Cotrone jcotrone@shire.com +1 617 899-3280
FTI Consulting (Media Advisor to the Company)
Ben Atwell (London) ben.atwell@fticonsulting.com +44 20 3727 1000
David Roady (New York) david.roady@fticonsulting.com +1 212 850 5600
Robert Stanislaro (New robert.stanislaro@fticonsulting.com +1 212 850 5600
York)
FOR BAXALTA
Investor Relations
Mary Kay Ladone mary.kay.ladone@baxalta.com +1 224 940 3371
Media
Geoffrey Mogilner geoffrey.mogilner@baxalta.com +1 224 940 5964
Kekst and Company (Media Advisor to the Company)
Tom Davies tom.davies@kekst.com +1 212 521 4873
Ruth Pachman ruth.pachman@kekst.com +1 212 521 4891
Nick Bastin nick.bastin@cnc-communications.com +44 20 3219 8814
Advisors
Evercore, Morgan Stanley, Barclays and Deutsche Bank are acting as financial
advisors to Shire. Goldman Sachs and Citi are acting as financial advisors to
Baxalta. Ropes & Gray, Cravath, Swaine, & Moore? and Slaughter and May are
acting as legal advisors to Shire. Kirkland & Ellis is acting as transaction
counsel and Jones Day is acting as regulatory counsel to Baxalta.
?Morgan Stanley and Barclays are also providing financing for the transaction.
Evercore Partners International LLP ("Evercore"), which is authorized and
regulated by the Financial Conduct Authority in the United Kingdom, is acting
as financial advisor to Shire in connection with the Combination and/or the
matters referred to in this announcement and no one else in connection with the
matters referred to in this announcement and will not be responsible to anyone
other than Shire for providing the protections afforded to clients of Evercore
or for providing advice in relation to the contents of this announcement or any
other matters referred to herein.
Morgan Stanley & Co. International plc ("Morgan Stanley"), which is authorized
by the Prudential Regulation Authority and regulated by the Financial Conduct
Authority and the Prudential Regulation Authority in the United Kingdom, is
acting as financial advisor to Shire and no one else in connection with the
matters referred to in this announcement. In connection with such matters,
Morgan Stanley, its affiliates and its and their respective directors,
officers, employees and agents will not regard any other person as their
client, nor will they be responsible to any other person other than Shire for
providing the protections afforded to their clients or for providing advice in
connection with the contents of this announcement or any other matter referred
to herein.
Barclays, which is authorised by the Prudential Regulation Authority and
regulated by the Financial Conduct Authority and the Prudential Regulation
Authority, is acting exclusively for Shire and no one else in connection with
the Combination and will not be responsible to anyone other than Shire for
providing the protections afforded to its clients or for providing advice in
relation to the Combination or in relation to the contents of this announcement
or any transaction or any other matters referred to herein.
Deutsche Bank AG is authorized under German Banking Law (competent authority:
European Central Bank) and, in the United Kingdom, by the Prudential Regulation
Authority. It is subject to supervision by the European Central Bank and by
BaFin, Germany's Federal Financial Supervisory Authority, and is subject to
limited regulation in the United Kingdom by the Prudential Regulation Authority
and Financial Conduct Authority. Details about the extent of its authorization
and regulation by the Prudential Regulation Authority, and regulation by the
Financial Conduct Authority are available on request. Deutsche Bank AG, acting
through its London branch ("DB"), is acting as a corporate broker to Shire plc
and no other person in connection with the matters referred to in this
announcement. DB will not be responsible to any person other than Shire plc for
providing any of the protections afforded to clients of DB, nor for providing
any advice in relation to the matters referred to herein. Without limiting a
person's liability for fraud, neither DB nor any of its subsidiary
undertakings, branches or affiliates nor any of its or their respective
directors, officers, representatives, employees, advisors or agents owes or
accepts any duty, liability or responsibility whatsoever (whether direct or
indirect, whether in contract, in tort, under statute or otherwise) to any
person who is not a client of DB in connection with this announcement, any
statement contained herein or otherwise.
Forward-Looking Statements
Statements included herein that are not historical facts, including without
limitation statements concerning our proposed business combination with Baxalta
Incorporated ("Baxalta") and the timing and financial and strategic benefits
thereof, our 20x20 ambition that targets $20 billion in combined product sales
by 2020, as well as other targets for future financial results, capital
structure, performance and sustainability of the combined company, the combined
company's future strategy, plans, objectives, expectations and intentions, the
anticipated timing of clinical trials and approvals for, and the commercial
potential of, inline or pipeline products are forward-looking statements. Such
forward-looking statements involve a number of risks and uncertainties and are
subject to change at any time. In the event such risks or uncertainties
materialize, Shire's results could be materially adversely affected. The risks
and uncertainties include, but are not limited to, the following:
* the proposed combination with Baxalta may not be completed due to a failure
to satisfy certain closing conditions, including any shareholder or
regulatory approvals or the receipt of applicable tax opinions;
* the businesses may not be integrated successfully, such integration may be
more difficult, time-consuming or costly than expected, or the expected
benefits of the transaction may not be realized;
* disruption from the proposed transaction may make it more difficult to
conduct business as usual or maintain relationships with patients,
physicians, employees or suppliers;
* the combined company may not achieve some or all of the anticipated
benefits of Baxalta's spin-off from Baxter International, Inc. ("Baxter")
and the proposed transaction may have an adverse impact on Baxalta's
existing arrangements with Baxter, including those related to transition,
manufacturing and supply services and tax matters;
* the failure to achieve the strategic objectives with respect to the
proposed combination with Baxalta may adversely affect the combined
company's financial condition and results of operations;
* Shire may not complete its proposed acquisition of Dyax Corp. ("Dyax") due
to the occurrence of an event, change or other circumstances that gives
rise to the termination of the relevant merger agreement or the failure to
satisfy certain closing conditions, including the Dyax shareholder
approval;
* products and product candidates may not achieve commercial success;
* product sales from ADDERALL XR and INTUNIV are subject to generic
competition;
* the failure to obtain and maintain reimbursement, or an adequate level of
reimbursement, by third-party payers in a timely manner for the combined
company's products may affect future revenues, financial condition and
results of operations, particularly if there is pressure on pricing of
products to treat rare diseases;
* supply chain or manufacturing disruptions may result in declines in revenue
for affected products and commercial traction from competitors; regulatory
actions associated with product approvals or changes to manufacturing
sites, ingredients or manufacturing processes could lead to significant
delays, an increase in operating costs, lost product sales, an interruption
of research activities or the delay of new product launches;
* the successful development of products in various stages of research and
development is highly uncertain and requires significant expenditures and
time, and there is no guarantee that these products will receive regulatory
approval;
* the actions of certain customers could affect the combined company's
ability to sell or market products profitably, and fluctuations in buying
or distribution patterns by such customers can adversely affect the
combined company's revenues, financial condition or results of operations;
* investigations or enforcement action by regulatory authorities or law
enforcement agencies relating to the combined company's activities in the
highly regulated markets in which it operates may result in significant
legal costs and the payment of substantial compensation or fines;
* adverse outcomes in legal matters and other disputes, including the
combined company's ability to enforce and defend patents and other
intellectual property rights required for its business, could have a
material adverse effect on the combined company's revenues, financial
condition or results of operations;
* Shire is undergoing a corporate reorganization and was the subject of an
unsuccessful acquisition proposal and the consequent uncertainty could
adversely affect the combined company's ability to attract and/or retain
the highly skilled personnel needed to meet its strategic objectives;
* failure to achieve the strategic objectives with respect to Shire's
acquisition of NPS Pharmaceuticals Inc. or Dyax may adversely affect the
combined company's financial condition and results of operations;
* the combined company will be dependent on information technology and its
systems and infrastructure face certain risks, including from service
disruptions, the loss of sensitive or confidential information,
cyber-attacks and other security breaches or data leakages that could have
a material adverse effect on the combined company's revenues, financial
condition or results of operations;
* the combined company may be unable to retain and hire key personnel and/or
maintain its relationships with customers, suppliers and other business
partners;
* difficulties in integrating Dyax or Baxalta into Shire may lead to the
combined company not being able to realize the expected operating
efficiencies, cost savings, revenue enhancements, synergies or other
benefits at the time anticipated or at all; and
* other risks and uncertainties detailed from time to time in Shire's,Dyax's
or Baxalta's filings with the Securities and Exchange Commission ("SEC"),
including those risks outlined in Baxalta's current Registration Statement
on Form S-1, as amended, and in "Item 1A: Risk Factors" in Shire's Annual
Report on Form 10-K for the year ended December 31, 2014.
All forward-looking statements attributable to us or any person acting on
our behalf are expressly qualified in their entirety by this cautionary
statement. Readers are cautioned not to place undue reliance on these
forward-looking statements that speak only as of the date hereof. Except to
the extent otherwise required by applicable law, we do not undertake any
obligation to republish revised forward-looking statements to reflect
events or circumstances after the date hereof or to reflect the occurrence
of unanticipated events.
Additional Information
This communication does not constitute an offer to buy or solicitation of any
offer to sell securities or a solicitation of any vote or approval. It does not
constitute a prospectus or prospectus equivalent document. This communication
relates to the proposed business combination between Shire and Baxalta. The
proposed combination will be submitted to Shire's and Baxalta's shareholders
for their consideration and approval. In connection with the proposed
combination, Shire and Baxalta will file relevant materials with (i) the SEC,
including a Shire registration statement on Form S-4 that will include a proxy
statement of Baxalta and a prospectus of Shire, and (ii) the Financial Conduct
Authority (FCA) in the UK, including a prospectus relating to Shire ordinary
shares to be issued in connection with the proposed combination and a circular
to the shareholders of Shire. Baxalta will mail the proxy statement/prospectus
to its shareholders and Shire will mail the circular to its shareholders. This
communication is not a substitute for the registration statement, proxy
statement/prospectus, UK prospectus, circular or other document(s) that Shire
and/or Baxalta may file with the SEC or the FCA in connection with the proposed
transaction. INVESTORS AND SECURITY HOLDERS OF SHIRE AND BAXALTA ARE URGED TO
READ CAREFULLY THE REGISTRATION STATEMENT, PROXY STATEMENT/PROSPECTUS AND OTHER
DOCUMENTS FILED WITH THE SEC AND THE UK PROSPECTUS AND CIRCULAR WHEN THEY
BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT SHIRE,
BAXALTA AND THE PROPOSED TRANSACTION. Investors and security holders may obtain
free copies of these documents (when they are available) and other related
documents filed with the SEC at the SEC's web site at www.sec.gov. Investors
may request copies of the documents filed with the SEC by Shire by directing a
request to Shire's Investor Relations department at Shire plc, Attention:
Investor Relations, 300 Shire Way, Lexington, MA 02421 or to Shire's Investor
Relations department at +1 484 595 2220 in the U.S. and +44 1256 894157 in the
UK or by email to investorrelations@Shire.com. Investors may request copies of
the documents filed with the SEC by Baxalta by directing a request to Mary Kay
Ladone at mary.kay.ladone@baxalta.com or (224) 948-3371.
Certain Information Regarding Participants
Shire, Baxalta and their respective directors and executive officers may be
deemed participants in the solicitation of proxies in connection with the
proposed transaction. You can find information about Shire's directors and
executive officers in Shire's Annual Report on Form 10-K for the year
ended December 31, 2014, which was filed with the SEC on February 24, 2015. You
can find information about Baxalta's directors and executive officers
in Baxalta's registration statement on Form S-1, which was filed with
the SEC on September 1, 2015.Additional information regarding the special
interests of these directors and executive officers in the proposed transaction
will be included in the registration statement, proxy statement/prospectus or
other documents filed with the SEC if any when they become available. You may
obtain these documents (when they become available) free of charge at
the SEC's web site at www.sec.gov and from Investor Relations at Shire or
Baxalta as described above.
This communication shall not constitute an offer to sell or the solicitation of
an offer to buy any securities, nor shall there be any sale of securities in
any jurisdiction in which such offer, solicitation or sale would be unlawful
prior to registration or qualification under the securities laws of any such
jurisdiction. No offering of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the U.S. Securities Act of
1933, as amended.
Trademarks
Shire owns or has rights to use the trademarks, service marks and trade names
that it uses in conjunction with the operation of its business. Some of the
trademarks that Shire owns or has the rights to use that are referenced in this
communication include: ADDERALL XR, CINRYZE, ELAPRASE, FIRAZYR, GATTEX/
REVESTIVE, INTUNIV, LIALDA, NATPARA, REPLAGAL, PENTASA, VPRIV, VYVANSE and
XAGRID. Baxalta states that it owns or has the right to use certain trademarks
referenced in this communication, including: ADVATE, ADYNOVATE, ARALAST, FEIBA,
FLEXBUMIN, GAMMAGARD, GAMMAGARD LIQUID, GLASSIA, HYQVIA, OBIZUR, ONCASPAR,
ONIVYDE, RECOMBINATE, RIXUBIS and SUBCUVIA, which may be registered or used in
the United States and other jurisdictions.
Basis of Forecasts
The Shire forecasts included herein are derived from Shire's Long Range Plan
(the "LRP") and Shire's papers subsequently produced as part of the business
planning process. Shire produces a long range plan annually. The LRP was
updated in March 2015, as part of Shire's annual planning cycle, and was
reviewed by the Board in April 2015. This LRP was subsequently adjusted to
reflect revised expectations for SHP625 following trial results in the second
quarter of 2015, the Dyax acquisition and other updates for 2015 actual
performance.
The forecast product sales in this announcement are consistent with the LRP,
which is at constant exchange rates, and reflects net sales for each product
and key line extensions currently identified as in Phase III, Phase II and
those in Phase I included in the LRP as launching before the end of 2020.
The forecast product sales included in the LRP are risk-adjusted to reflect
Shire's assessment of the individual probability of launch of products in
development, and the probability of success in further life cycle management
trials. Estimates for these probabilities are based on industry wide data for
relevant clinical trials in the pharmaceutical industry at a similar stage of
development.
For each pharmaceutical product, there is a range of possible outcomes from
clinical development, driven by a number of variables, including safety,
efficacy and product labelling. In addition, if a product is approved, the
effect of commercial factors including the patient population, the competitive
environment, pricing and reimbursement is also uncertain. As a result, the
actual net sales achieved by a product over its commercial life will be
different, perhaps materially so, from the risk adjusted net sales figures in
this announcement and should be considered in this light.
The forecast product sales for Baxalta included in this press release have been
stated on a constant currency and risk adjusted basis.
SHIRE Shire : to combine with Baxalta (SHIRE )
January 11, 2016 at 07:31 am
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