Shire plc Shire Announces Business Update At 36th -2-

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Shire Announces Business Update at 36(th) Annual J.P. Morgan Healthcare

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Conference

-- Projects continued strong growth as the global leader in rare diseases,

led by the immunology franchise

-- Will operate as two divisions: Rare Disease and Neuroscience, to enable

increased focus, investment and growth

-- Target Non GAAP Net Debt to EBITDA* ratio of less than 2.5x by end of

2018

Dublin, Ireland - January 8, 2018 - Shire plc (LSE: SHP, NASDAQ: SHPG)

('Shire' or the 'Company'), continues to progress its strategy as the

leading global biotech company focused on rare diseases. Shire expects

continued revenue growth driven by a diverse portfolio of leading brands

including those within its Immunology franchise, which grew 21% in the

first three quarters of 2017 on a pro forma basis. In addition, Shire

continues to have a promising late stage pipeline with fifteen programs

currently in Phase 3. The Company projects total revenues to reach

$17-18 billion by 2020.

In August 2017, Shire announced that it was conducting a strategic

review of its neuroscience business. Following the first stage of this

review, the Board has concluded that the neuroscience business warrants

additional focus and investment and that there is a strong business

rationale for creating two distinct business divisions within Shire: a

Rare Disease Division and a Neuroscience Division. Each division will

benefit from sharper management focus, greater strategic clarity, and an

increased ability to deploy resources to key growth priorities. The

Board believes this will be an important first step in enabling both

divisions to maximize mid- to long-term product sales, cash generation,

and innovation.

Shire expects to report the operational performance metrics of each

division separately beginning with the first quarter of 2018. The

second stage of the review will include continuing to evaluate all

strategic alternatives, including the merits of an independent listing

for each of the two divisions. The Company will give an update on the

second stage of the review in the second half of 2018.

In addition, the Company confirms that its debt repayment schedule

remains on track and announces a target Non GAAP Net Debt to EBITDA

ratio of below 2.5x by the end of 2018, excluding the effect of any

bolt-on acquisitions or licensing transactions.

Flemming Ornskov, M.D., M.P.H., Chief Executive Officer, Shire said:

"Shire has undergone a significant transformation over the last five

years creating two market-leading businesses with distinct profiles and

future needs. Simultaneously, Shire has established a strong track

record of growth and execution. Our new Rare Disease and Neuroscience

Divisions will be well positioned for growth, profitability, innovation,

and serving the needs of patients. We are also pleased with our

continued progress on delevering and will now be targeting a Non GAAP

Net Debt to EBITDA[*] ratio of below 2.5x by the end of 2018."

Rationale for Divisional Structure

The rare disease and neuroscience businesses have distinct strategic

priorities. Following the creation of the two divisions, Rare Disease

and Neuroscience will be better positioned to deliver their full

potential, enabling them to maximize mid- to long-term product sales,

innovation, and profitability. Shire will use 2018 to optimize the

portfolio for each of these two divisions, which may include business

development activities such as partnerships, licensing agreements, and

bolt-on acquisitions.

-- Rare Disease division: Shire's rare disease business has

a recognized track record of sustained growth and will build on its

leading market position, investing both organically and inorganically to

further enhance its innovative pipeline. Approximately 70% of Shire's

revenues, as of September 30, 2017 on a trailing 12 month basis, were

from rare disease products, and multiple franchises continue to be poised

for growth in 2018. Shire expects increased demand for HYQVIA and CUVITRU

from our Immunology franchise, which grew 21% in the first three quarters

of 2017 on a pro forma basis. Shire expects to continue to be the leader

in the Hematology space with key brands such as ADVATE and ADYNOVATE, and

the anticipated introduction of MyPKFit in the US in 2018. Shire also

anticipates that Internal Medicine will see an increased demand for

NATPARA (hypoparathyroidism) and GATTEX (short bowel syndrome), while

Ophthalmics should benefit from US and global growth of XIIDRA (dry eye

disease), The Rare Disease division will have a robust late-stage

pipeline including SHP643 for hereditary angioedema, SHP620 for CMV

infection in transplant patients, which just received breakthrough

designation from the FDA as well as orphan drug designation, SHP607 for

the prevention of respiratory morbidity in premature infants, and SHP621

for eosinophilic esophagitis, all of which are subject to positive

pivotal data and regulatory approval.

-- Neuroscience division: Neuroscience has long delivered strong top-line

growth and continued leadership in ADHD, beginning more than twenty years

ago with ADDERALL and later ADDERALL XR. Since then, Shire has continued

to grow in the space through innovation resulting in products like

INTUNIV, VYVANSE, and the recent launch of MYDAYIS in the US. The

Neuroscience division will build on this industry-leading platform with a

focus on neuropsychiatry more broadly. Shire expects it will drive

growth in the future by expanding internationally and into adjacencies

through disciplined R&D and business development. Shire will continue to

launch and grow in key international markets with both VYVANSE and

INTUNIV to treat both pediatric and adult ADHD. The division's pipeline

will include SHP680 for multiple neurological conditions and BUCCOLAM in

the US.

Delevering targets

Shire has remained highly cash generative in 2017 and made good progress

with its plans to reduce its Non GAAP Net Debt* following the

acquisition of Baxalta in 2016. With continued strong cash generation,

Shire anticipates its Non GAAP Net Debt* to further decline during the

course of 2018 and today announces a target Non GAAP Net Debt to EBITDA*

ratio of below 2.5x by the end of 2018, excluding the effect of any

bolt-on acquisitions or licensing transactions. Shire also reiterates

that its 2018 capital allocation priorities remain unchanged-investing

in organic growth, reducing leverage, maintaining a progressive dividend

policy, and in the event of surplus capital the consideration of

selective in-licensing and bolt-on business development opportunities,

as well as the consideration of share buybacks.

* Non GAAP EBITDA consists of Operating Income from Continuing

Operations less Amortization, Depreciation and certain Non GAAP

adjustments. Non GAAP net debt represents cash and cash equivalents

less short- and long-term borrowings, capital leases and other debt.

Live audio webcast:

A live audio webcast of Dr. Ornskov's J.P. Morgan Healthcare Conference

presentation and the questions & answers session will be available on

Shire's Investor website at

http://investors.shire.com/presentations-and-reports today at 10:30am

PST / 1:30pm EST / 6:30pm GMT. Subsequently, a replay of the webcast

will be available on this same website for approximately 90 days.

For further information from Shire please contact:

Investor Relations

Christoph Brackmann christoph.brackmann@shire.com +41 79 543 3259

Sun Kim sun.kim@shire.com +1 617 588 8175

Robert Coates rcoates@shire.com +44 203 549 0874

Media

Lisa Adler lisa.adler@shire.com +1 617 588 8607

Katie Joyce kjoyce@shire.com +1 781 482 2779

NOTES TO EDITORS

Stephen Williams, Deputy Company Secretary, is responsible for arranging

the release of this announcement.

Inside Information

This announcement contains inside information.

About Shire

Shire is the global leader in serving patients with rare diseases. We

strive to develop best-in-class therapies across a core of rare disease

areas including hematology, immunology, genetic diseases, neuroscience,

and internal medicine with growing therapeutic areas in ophthalmics and

oncology. Our diversified capabilities enable us to reach patients in

more than 100 countries who are struggling to live their lives to the

fullest.

We feel a strong sense of urgency to address unmet medical needs and

work tirelessly to improve people's lives with medicines that have a

meaningful impact on patients and all who support them on their journey.

www.shire.com

Forward-Looking Statements

Statements included herein that are not historical facts, including

without limitation statements concerning future strategy, plans,

objectives, expectations and intentions, projected revenues, 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:

-- Shire's products may not be a commercial success;

-- increased pricing pressures and limits on patient access as a result of

governmental regulations and market developments may affect Shire's

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, among other things, significant

delays, an increase in operating costs, lost product sales, an

interruption of research activities or the delay of new product launches;

-- certain of Shire's therapies involve lengthy and complex processes, which

may prevent Shire from timely responding to market forces and effectively

managing its production capacity;

-- 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 affect Shire's revenues,

financial conditions or results of operations;

-- Shire's products and product candidates face substantial competition in

the product markets in which it operates, including competition from

generics;

-- adverse outcomes in legal matters, tax audits 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 the Company's revenues, financial condition or

results of operations;

-- inability to successfully compete for highly qualified personnel from

other companies and organizations;

-- failure to achieve the strategic objectives, including expected operating

efficiencies, cost savings, revenue enhancements, synergies or other

benefits at the time anticipated or at all with respect to Shire's

acquisitions, including NPS Pharmaceuticals Inc., Dyax Corp. or Baxalta

Incorporated may adversely affect Shire's financial condition and results

of operations;

-- Shire's growth strategy depends in part upon its ability to expand its

product portfolio through external collaborations, which, if unsuccessful,

may adversely affect the development and sale of its products;

-- a slowdown of global economic growth, or economic instability of

countries in which Shire does business, as well as changes in foreign

currency exchange rates and interest rates, that adversely impact the

availability and cost of credit and customer purchasing and payment

patterns, including the collectability of customer accounts receivable;

-- failure of a marketed product to work effectively or if such a product is

the cause of adverse side effects could result in damage to Shire's

reputation, the withdrawal of the product and legal action against Shire;

-- 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;

-- Shire is 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 Shire's revenues, financial condition or results of

operations;

-- Shire incurred substantial additional indebtedness to finance the Baxalta

acquisition, which has increased its borrowing costs and may decrease its

business flexibility;

-- Our ongoing strategic review of our Neuroscience franchise may distract

management and employees and may not lead to improved operating

performance or financial results; there can be no guarantee that, once

completed, our strategic review will result in any additional strategic

changes beyond those that have already been announced; and

a further list and description of risks, uncertainties and other matters

can be found in Shire's most recent Annual Report on Form 10-K and in

Shire's subsequent Quarterly Reports on Form 10-Q, in each case

including those risks outlined in "ITEM 1A: Risk Factors", and in

Shire's subsequent reports on Form 8-K and other Securities and Exchange

Commission filings, all of which are available on Shire's website.

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 update or revise forward-looking

statements, whether as a result of new information, future events or

otherwise.

###

This announcement is distributed by Nasdaq Corporate Solutions on behalf

of Nasdaq Corporate Solutions clients.

The issuer of this announcement warrants that they are solely

responsible for the content, accuracy and originality of the information

contained therein.

Source: Shire plc via Globenewswire

(END) Dow Jones Newswires

January 08, 2018 09:45 ET (14:45 GMT)