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Competition to bite into Shire's hemophilia treatment sales

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Competition to bite into Shire's hemophilia treatment sales

Shire PLC is bracing for a drop in sales of its bleeding disorder treatments as it faces greater competition.

The Dublin-based biopharmaceutical company told analysts on its fourth-quarter earnings call that sales of products to patients who have not yet built up resistance to typical therapies that replace factor VIII, the clotting protein missing in hemophilia A patients, could tumble 30% by 2022 from 2017 levels after the introduction of Roche Holding AG's recently approved hemophilia A treatment, Hemlibra.

Also known as emicizumab, Hemlibra is the first new hemophilia therapy to launch in decades, raising threats to rival products from Shire, Sanofi and Novo Nordisk A/S. Shire previously said it could see a 50% reduction in sales of products for patients with a built-up resistance to treatment, known as inhibitor patients.

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For 2018, the drugmaker is eyeing total product sales in the range of $14.9 billion to $15.3 billion after it recorded a 6% year-over-year increase in revenue in 2017. Shire reported overall growth of 3% in its hemophilia franchise for 2017, driven by U.S. sales of the Adynovi therapy.

Sales of the inflammatory bowel drug Lialda, or mesalamine, were hurt by U.S. generic competition in the second half of 2017, dragging down overall revenue growth during the year by about 2 percentage points. The company reiterated the expected impact of generic competition on high-margin products and a reduction in royalties.

Shire is also trying to soften the impact of generic competition through growth in its now-combined immunology and hereditary angioedema businesses. The company has been examining options for noncore products since its $32 billion acquisition of Baxalta, such as its exit from the biosimilars business, CEO Flemming Ørnskov said.

The company said it will set up its neuroscience business as an independent division, reporting separate financials for the unit and the rare disease business starting in the first quarter. The neuroscience division is expected to see a boost from Mydayis, used for treating attention deficit hyperactivity disorder.

"What has been a big surprise for me is how many opportunities there are simply in licensing opportunities in neuroscience," said Ørnskov, adding that there are also smaller M&A opportunities. "They would also make potentially a meaningful impact to the long-term growth outlook for the neuroscience business."

Meanwhile, interim CFO John Miller said the company is on track in relation to Baxalta's integration, helping to lift margins. "The commercial integration is well advanced and should be completed this year," Ørnskov added.

Ørnskov also noted that competition in the non-inhibitor space is in its "early days" and "not quantifiable at this stage."