Shire share price rises as pharmco scores victory in Lialda patent case

on Mar 29, 2016
Updated: Oct 21, 2019

Shares in Shire (LON:SHP) are trading in positive territory this morning, outperforming the broader London market and peers AstraZeneca (LON:AZN) and GlaxoSmithKline (LON:GSK), with an US district court ruling in favour of the FTSE 100 rare disease specialist in a patent case. The ruling prevents rival Allergan from selling a generic version of Shire’s ulcerative colitis drug Lialda in the US until the end of the decade.

As of 09:47 BST, Shire’s share price had gained 1.13 percent to 3,929.00p, outperforming the benchmark FTSE 100 index which currently stands 0.40 percent higher at 6,130.85 points. The pharmco’s shares have lost 27.58 percent of their value over the past year, and are down 16.37 percent in the year-to-date.
Reuters reported yesterday that Judge Donald Middlebrooks of the Southern Florida district court had ruled that Allergan’s Watson unit had infringed on two claims of the Lialda drug patent. The ruling comes after the US Supreme Court sent back Shire’s Lialda drug patent case to a lower court last year for further proceedings. The appeals court had previously thrown out a lower court decision in Shire’s favour, with the district court having found that a competing product manufactured by Allergan’s Watson unit had infringed on the UK pharmco’s patent.

Lialda, which treats inflammatory bowel conditions, is a key drug for Shire, having brought in $684.4 million in sales for the year ended December 31, and contributing 11 percent to the group’s total sales of $6.1 billion.
Analysts meanwhile remain mostly positive on Shire, with both Sanford C. Bernstein and BNP Paribas reaffirming the company as an ‘overweight’ this month, with price targets of 5,000p and 5,700p, respectively. Credit Suisse, however, reiterated its ‘neutral’ stance on the rare disease specialist yesterday, valuing the stock at 3,200p.
As of 10:08 BST, Tuesday, 29 March, Shire PLC share price is 3,930.50p.