NEW YORK (Reuters) - Shire PLC’s SHP.L chief executive said he sees no urgency to spend the windfall the Dublin-based drugmaker received when AbbVie (ABBV.N) walked away from a $55 billion takeover bid earlier this year.
AbbVie scuttled the so-called inversion deal in October after changes in U.S. tax rules aimed at preventing U.S. companies from redomiciling abroad to take advantage of lower corporate taxes.
“It’s very nice that we got almost $1.7 billion in breakup fee. I think that was well deserved,” Shire Chief Executive Flemming Ornskov said in an interview following a presentation for analysts and investors in New York showcasing drugs Shire is developing.
“Our investors want us to spend the money on driving growth and innovation and fulfilling patient needs, but I have no particular burning need to spend it immediately,” Ornskov said.
“I and the board have already moved on. We’re focused on Shire as an independent company. We got a good break fee that we can put to future use.”
Ornskov was widely expected to leave the company had the AbbVie deal gone through. With that distraction behind, the CEO is focused on bringing to market drugs for rare diseases, particularly those aimed at treating the suffering of children.
“I feel like a really lucky guy,” said the Danish pharma industry veteran, who became Shire CEO in April 2013. “I work in field that’s incredibly fulfilling. A lot of products that we are developing are targeted at the pediatric part of the population, and I would like to continue that mission with my team.”
Ornskov called the company’s goal of reaching $10 billion in annual sales by 2020 “challenging but achievable.” That would be about double the company’s annual revenue in 2013.
The goal was based on $7 billion from existing products and $3 billion from the pipeline, but investors can expect revenue from future deals as well.
“The goal was developed without thinking that we would be needing to do additional deals, but I can assure you that we will be doing additional deals before 2020,” Ornskov said. “That’s in our DNA. It’s how we grow our business, so that will be on top of this goal.”
Reporting by Bill Berkrot; Editing by Christian Plumb