FOSRENOL - Hyperphosphatemia
Product sales of FOSRENOL were flat as the effect of price increases taken since Q2 2010 and positive foreign exchange offset lower US prescription demand due to a fall in market share. On a CER basis sales were down quarter on quarter by 5%.
Year on year growth Royalties to Product Shire $M Royalties CER ADDERALL XR 1.00 26.9 -2% -2% FOSRENOL 1.00 12.4 107% 107% 3TC(R) and Zeffix(R) 1.00 11.3 -70% -70% Other 1.00 12.8 15% 5% Total 1.00 63.4 -23% -25%
Royalty income decreased in Q2 2011 compared to Q2 2010 as higher royalties on FOSRENOL were more than offset by lower royalties from 3TC and Zeffix.
Royalty income from 3TC and Zeffix continues to be adversely impacted by increased competition from other products. Additionally, for certain territories in the second quarter of 2011 Shire did not recognise 3TC royalties for the current quarter, and reversed 3TC royalty income recognised in the prior two quarters, due to a difference of opinion between GlaxoSmithKline ("GSK") and Shire about how the relevant royalty rate should be applied given the expiry dates of certain patents. GSK and Shire are holding discussions in order to clarify this discrepancy.
FOSRENOL royalties increased in Q2 2011 due to higher demand for the product by Shire's Japanese partner given supply issues of a competitor resulting from the Japanese earthquakes earlier in 2011.
3. Financial details
Cost of product sales
% of % of product product Q2 2011 sales Q2 2010 sales $M $M Cost of product sales (US GAAP) 143.7 14% 119.1 16% Transfer of manufacturing from Owings Mills (2.8) (7.4) Deprecia
|SOURCE Shire plc|
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