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FDA Issues Approvable Letter for NRP104 (lisdexamfetamine dimesylate) for the Treatment of ADHD

BASINGSTOKE, England and PHILADELPHIA, October 6, 2006 -- Shire plc announced today that its collaborative partner New River Pharmaceuticals Inc. has received an approvable letter from the U.S. Food and Drug Administration (FDA) for NRP104 (lisdexamfetamine dimesylate), for the treatment of pediatric Attention-Deficit/Hyperactivity Disorder (ADHD). This result is generally consistent with historical responses from FDA following their review of New Drug Applications for ADHD medications. According to the FDA's letter, marketing approval of NRP104 is contingent upon final scheduling by the U.S. Drug Enforcement Administration (DEA). No additional studies have been requested by the FDA as a condition for approval of NRP104. Shire and New River will continue dialog with FDA officials to agree upon a final trade name. Shire and New River Pharmaceuticals are preparing for a product launch in Q2 2007, pending final labelling and scheduling discussions.

The Controlled Substance Staff of the FDA has initially proposed that NRP104 be placed in Schedule II of the Controlled Substance Act. The initial proposal will be submitted to the DEA, which is responsible for making a final scheduling assignment. Shire anticipates timely resolution of this process. Once NRP104 is approved by FDA and the schedule designation is issued by DEA, NRP104 will be available in three dosage strengths: 30 mg, 50 mg and 70 mg, all indicated for once-a-day dosing.1

This approvable letter for NRP104 is positive news for Shire and our partner New River Pharmaceuticals," said Shire Chief Executive Officer Matthew Emmens. "Following approval, NRP104 is expected to offer patients, their families, and healthcare providers an important new treatment for ADHD. As a company specializing in the treatment of ADHD, we have a wide range of medications for this condition currently marketed or under development, including the most prescribed brand of ADHD medication, Adderall XR. Once approved, we look forward to adding NRP104 to the Shire portfolio."

New River Pharmaceuticals designed NRP104 as a new ADHD medication in which dextro-amphetamine is covalently linked to l-lysine, a naturally occurring amino acid. NRP104, designed to provide efficacy throughout the day up to 6 p.m., remains inactive until converted in the body and the active drug is released.1

In January 2005, New River Pharmaceuticals signed a collaborative agreement with Shire to develop and commercialize NRP104.

The Collaboration Agreement

Shire plans to file a Current Report on Form 8-K with the U.S. Securities and Exchange Commission providing additional details on the company's U.S. collaboration agreement with New River.

Under the terms of the agreement with New River, the parties will collaborate on NRP104 development, manufacturing, marketing and sale in the US. New River Pharmaceuticals will be financially and operationally responsible for clinical and manufacturing development. Shire will book the product sales and New River Pharmaceuticals will supply up to 25% of the sales effort under a co promotion right. Shire is obligated to give NRP104 marketing and promotional priority over its other oral ADHD stimulants should NRP104's label contain a claim that it has decreased potential for abuse or overdose protection.

If NRP104 is approved with a Schedule III, IV or V classification or is unscheduled ("favorable scheduling"), Shire will pay New River a $300 million milestone payment. US operating profit will be divided as follows: Shire will retain 75 percent of profits for the first two years following launch, and the parties will share the profits equally thereafter.

In the event that NRP104 receives a final Schedule II classification, no milestone payment will be payable by Shire to New River upon approval. Division of profits will be calculated under an alternative profit sharing scheme. New River's share of U.S. product profits for the first two years will be at least 25%, though it may increase to a value determined by a preset formula; for following years, it will be at least 50%, though it may increase to a value determined by a preset formula thereafter. These formulas, which include yearly threshold sales, will be included in the 8-K to be filed.

If NRP104 is approved with a Schedule II classification on approval and it gets favorable scheduling within one year of the first commercial sale, Shire will pay New River a $200 million milestone payment; if favorable scheduling occurs by the third anniversary, the milestone payment will be $100 million. Upon favorable scheduling being achieved under each of these scenarios, the profit sharing formula reverts to that applicable to favorable scheduling from product approval.

In addition, New River will be entitled to a $100 million milestone payment at the end of the first calendar year in which cumulative worldwide net sales of all collaboration products during that calendar year exceed $1 billion. Shire intends to capitalize and amortize any milestone payment and sales bonus over the life of the product.

Shire is entitled to terminate the agreement until 30 days following approval of NRP104. If Shire terminates before regulatory approval, no payment would be due Shire. If Shire terminates after approval and NRP104 has received a favorable scheduling assignment, no payment would be due Shire. If the approved NRP104 has received a Schedule II classification, Shire would be entitled to a $50 million termination payment, payable in cash, New River common stock, or an unsecured, 5-year promissory note, as will be agreed upon by Shire and New River.

On August 14, 2006 Shire announced that it had settled all pending litigation with Barr Laboratories, Inc. in connection with Barr's Abbreviated New Drug Application and its attempt to market generic versions of Shire's Adderall XR (extended-release mixed amphetamine salts) for the treatment of ADHD. Barr will not be permitted to market a generic version of Adderall XR in the United States until April 1, 2009, except under certain limited circumstances, such as the launch of another party's generic version of Adderall XR.

About ADHD

Approximately 7.8 percent of all school-age children, or about 4.4 million U.S. children aged 4 to 17 years, have been diagnosed with ADHD at some point in their lives, according to the U.S. Centers for Disease Control and Prevention (CDC).2 ADHD is one of the most common psychiatric disorders in children and adolescents.3 ADHD is a neurobiological disorder that manifests as a persistent pattern of inattention and/or hyperactivity- impulsivity that is more frequent and severe than is typically observed in individuals at a comparable level of development.4 To be properly diagnosed with ADHD, a child needs to demonstrate at least six of nine symptoms of inattention; at least six of nine symptoms of hyperactivity/impulsivity; the onset of such symptoms before age 7 years; that some impairment from the symptoms is present in two or more settings (e.g., at school and home); that the symptoms continue for at least six months; and that there is clinically significant impairment in social, academic or occupational functioning.4

Although there is no "cure" for ADHD, there are accepted treatments that specifically target its symptoms. The most common standard treatments include educational approaches, psychological or behavioral modification, and medication.5

References:

  1. Data on file.
  2. Mental health in the United States: Prevalence of diagnosis and medication treatment for attention-deficit/hyperactivity disorder, United States, 2003. MMWR, September 2, 2005;54(34):842-847.
  3. "Introduction," Diagnosis and Treatment of Attention Deficit Hyperactivity Disorder. NIH Consensus Statement 1998 Nov 16-18; 16(2): 1-37.
  4. Diagnostic and Statistical Manual of Mental Disorders: Fourth Edition, Text Revision. DSM-TR-IV(r). Washington, DC: American Psychiatric Association; 2000: 85.
  5. Baumgartel A, et al. Practice guideline for the diagnosis and management of attention deficit hyperactivity disorder. Ambulatory Child Health. 1998;4:51.

Posted: October 2006

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