Shire Delivers Record Revenues And Non GAAP Earnings Per ADS In 2014, And Enters 2015 With Strongest-Ever Pipeline

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Shire (LSE: SHP, NASDAQ: SHPG) announces unaudited results for the year to December 31, 2014.

Financial Highlights	Full Year 2014	Growth⁽¹⁾
Product sales	$5,830 million	+23%⁽²⁾⁽³⁾
Total revenues	$6,022 million	+22%

Non GAAP operating income	$2,593 million	+39%
US GAAP operating income	$1,698 million	-2%

Non GAAP EBITDA margin (excluding royalties & other revenues)⁽⁴⁾	44%	+6 pps⁽⁵⁾
US GAAP net income margin⁽⁶⁾	57%	+44 pps

Non GAAP diluted earnings per ADS	$10.60	+38%
US GAAP diluted earnings per ADS	$17.28	+390%

Non GAAP cash generation	$2,402 million	+35%
Non GAAP free cash flow	$2,529 million	+94%
US GAAP net cash provided by operating activities	$4,228 million	+189%

⁽¹⁾ Results and percentages compare to the full financial year 2013.
⁽²⁾ Product sales from continuing operations, including ViroPharma Incorporated (“ViroPharma”) acquired January 24, 2014, and excluding the DERMAGRAFT business sold on January 17, 2014. Product sales excluding products acquired with ViroPharma were up 11% in 2014.
⁽³⁾ On a Constant Exchange Rate (“CER”) basis, which is a Non GAAP measure, product sales were up 23%.
⁽⁴⁾ Non GAAP earnings before interest, tax, depreciation and amortization (“EBITDA”) as a percentage of product sales, excluding royalties and other revenues.
⁽⁵⁾ Percentage point change (“PPS”).
⁽⁶⁾ US GAAP net income as a percentage of total revenues.

The Non GAAP financial measures included within this release are explained on page 32 of the full release, and are reconciled to the most directly comparable financial measures prepared in accordance with US GAAP on pages 24 - 29 of the full release.

Highlights

Delivered exceptionally strong product sales and Non GAAP diluted earnings per ADS
Successful integration of ViroPharma including accelerated CINRYZE sales
On track to complete the acquisition of NPS Pharma⁽¹⁾ in the first quarter of 2015
Substantially enhanced and progressed pipeline including recent FDA approval of VYVANSE for BED
Positioned for further growth in 2015 despite currency headwinds and the loss of exclusivity for INTUNIV
Confident in our ability to deliver our 10x20 organic growth aspirations with additional upside from Lumena, Fibrotech, Bikam and NPS Pharma acquisitions

Flemming Ornskov, M.D., Shire’s Chief Executive Officer, commented:

2014 was a transformational year for Shire as we delivered on our strategy by achieving record revenues and Non GAAP diluted earnings per ADS, and developing the strongest pipeline in our history. We also successfully executed on value-enhancing M&A and generated strong cash flows which will enable us to continue investing in drivers of growth.

In 2014 Shire delivered value through commercial excellence across our product portfolio. Bolstered by demand for therapies in our expanded Hereditary Angioedema (HAE) portfolio, sales by our Rare Diseases business unit grew by 46%(²). CINRYZE grew 30%(³) on a pro-forma basis and contributed sales

⁽¹⁾ NPS Pharma acquisition expected to close in Q1 2015, subject to satisfaction of customary closing conditions.
⁽²⁾ On a pro-forma basis including Cinryze sales in 2013 and prior to acquisition in 2014, growth was 18%.
⁽³⁾ 2013 Cinryze product sales as reported by ViroPharma.

of $503 million, and FIRAZYR saw a 55% increase with $364 million in sales. Neuroscience and GI also contributed to our strong results, with VYVANSE sales up 18% and LIALDA sales up 20%.

We significantly enhanced our pipeline in 2014, and now have 21 distinct programs in clinical development. Importantly, our pipeline is advancing, most recently with the US approval of VYVANSE for Binge Eating Disorder (BED) in adults. VYVANSE is the first product approved for BED that will help address this condition which affects an estimated 2.8 million adults in the US. In addition, positive results from a second phase 2 maribavir study in patients with disease which is resistant or refractory to the standard of care CMV therapy showed that maribavir, at all doses, was effective at lowering CMV to below the limits of assay detection.

The acquisition of ViroPharma contributed significantly to our growth this year, and the Lumena acquisition materially expanded our Gastrointestinal (GI) pipeline. Recently we announced plans to acquire NPS Pharma, a rare disease focused biopharmaceutical company. The transaction, expected to close in the first quarter of 2015, will enhance our growth profile and enable us to apply our GI and rare disease expertise to deliver two therapies – GATTEX for short bowel syndrome and NATPARA for hypoparathyroidism – to patients.

Following an exceptional 2014, we expect to deliver further growth in 2015 despite significant foreign currency headwinds, the loss of exclusivity for INTUNIV, and the inclusion of CINRYZE in our 2014 results. In 2015, Shire is well-positioned on our journey to become a leading global biotech as we complete our One Shire reorganization with the expected benefits of profitability and efficiency, and advance pivotal regulatory and clinical milestones that will contribute to $10 billion in product sales by 2020.

For further information please contact:

Investor Relations

Sarah Elton-Farr
[email protected]m
+44 1256 894157

Media

Brooke Clarke
[email protected]
+44 1256 894 829

Jessica Cotrone
[email protected]
+1 781 482 9538

Stephanie Fagan
[email protected]
+1 781 482 0460

Dial in details for the live conference call for investors at 14:00 BST / 09:00 EDT on February 12, 2015:

UK dial in:
0808 237 0030 or 0203 139 4830

US dial in:
1 866 928 7517 or 1 718 873 9077

International Access Numbers:
Click here

Password/Conf ID:
86223013#

Live Webcast:
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The quarterly earnings presentation will be available today at 13:00 BST / 08:00 EDT on:

Shire.com
Shire's IR Briefcase in the iTunes Store

NOTES TO EDITORS

Shire enables people with life-altering conditions to lead better lives.

Our strategy is to focus on developing and marketing innovative specialty medicines to meet significant unmet patient needs.

We focus 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

FORWARD - LOOKING STATEMENTS - "SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995(¹)

Statements included in this announcement that are not historical facts 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, that:

Shire’s products may not be a 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 payors in a timely manner for Shire's products may impact future revenues, financial condition and results of operations;
Shire conducts its own manufacturing operations for certain of its products and is reliant on third party contract manufacturers to manufacture other products and to provide goods and services. Some of Shire’s products or ingredients are only available from a single approved source for manufacture. Any disruption to the supply chain for any of Shire’s products may result in Shire being unable to continue marketing or developing a product or may result in Shire being unable to do so on a commercially viable basis for some period of time;
the manufacture of Shire’s products is subject to extensive oversight by various regulatory agencies. Regulatory approvals or interventions associated with changes to manufacturing sites, ingredients or manufacturing processes could lead to significant delays, increase in operating costs, lost product sales, an interruption of research activities or the delay of new product launches;
Shire has a portfolio of products in various stages of research and development. The successful development of these products 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 Shire's ability to sell or market products profitably. Fluctuations in buying or distribution patterns by such customers can adversely impact Shire’s revenues, financial conditions or results of operations;
investigations or enforcement action by regulatory authorities or law enforcement agencies relating to Shire’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 Shire’s ability to enforce and defend patents and other intellectual property rights required for its business, could have a material adverse effect on Shire’s revenues, financial condition or results of operations;
Shire faces intense competition for highly qualified personnel from other companies, academic institutions, government entities and other organizations. Shire is undergoing a corporate reorganization and the consequent uncertainty could adversely impact Shire’s ability to attract and/or retain the highly skilled personnel needed for Shire to meet its strategic objectives;
Shire’s proposed acquisition of NPS Pharma may not be consummated due to the occurrence of an event, change or other circumstances that gives rise to the termination of the merger agreement;
NPS Pharma may be unable to retain and hire key personnel and/or maintain its relationships with customers, suppliers and other business partners pending the consummation of the proposed acquisition by Shire, or NPS Pharma’s business may be disrupted by the proposed acquisition, including increased costs and diversion of management time and resources;
difficulties in integrating NPS Pharma 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 filings with the US Securities and Exchange Commission, including its most recent Annual Report on Form 10-K.

(¹) The safe harbors for forward-looking statements under the Private Securities Litigation Reform Act of 1995 are not applicable to forward-looking statements, if any, in connection with Shire’s tender offer for NPS Pharma.

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