Recently, Shire (SHPGY) announced the initiation of two phase IV trials of Vyvanse (lisdexamfetamine dimesylate) capsules. Vyvanse is currently marketed for attention-deficit hyperactivity disorder (ADHD) in children, adolescents and adults in the US and Canada. The product is also marketed in the US as a maintenance treatment for ADHD in adults.
The two randomized, double-blind and active-controlled studies will compare Vyvanse with Johnson & Johnson’s (JNJ) Concerta, another commonly prescribed ADHD product, in adolescents aged between 13 and 17 years. Both trials will enroll a total of approximately 1,000 patients. The results are expected to be released by the second half of 2013.
In December 2011, Shire had submitted a marketing application seeking European approval of Vyvanse for the treatment of children aged between 6 and 17 years who are diagnosed with ADHD. Shire is also evaluating the product for major depressive disorder/MDD (phase III), excessive daytime sleepiness/EDS (phase II), negative symptoms of schizophrenia/NSS (phase II) and other non-ADHD indications in adults (phase II).
Out Take
Vyvanse, with $805 million revenues in 2011, is the top revenue grosser at Shire. As per data provided by IMS Health National Prescription Audit, Vyvanse enjoys a 17% share of the US ADHD market. In 2011. Vyvanse’s growth of 27% was significantly higher than the US ADHD market’s growth of 10%.
However, we note that competition in the US market increased significantly in 2011 with the launch of generic versions of Concerta and Novartis’ (NVS) Ritalin. Moreover, a new drug, Kapvay, was launched by Japanese pharmaceutical company, Shionogi & Co., Ltd, in 2011.
Meanwhile, Shire is facing patent challenges for Vyvanse. Six companies, including Sandoz, Inc., Amneal Pharmaceuticals LLC, Watson Laboratories (WPI), Roxane Laboratories, Inc., Mylan Pharmaceuticals, Inc. (MYL) and Actavis Elizabeth LLC and Actavis Inc. (both together) have filed abbreviated new drug applications (ANDAs) for their generic versions of Vyvanse. Shire has filed patent infringement lawsuits against all these companies.
Our Recommendation
We currently have a Neutral recommendation on Shire. The stock carries a Zacks #2 Rank (Buy rating) in the short run.
Shire’s recent collaborations and acquisitions (including Movetis and Advanced BioHealing Inc.) have added immense potential to its pipeline. With several of its products already facing or likely to face generic competition, the company’s pipeline needs to deliver.
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