Sale of Oncology business unlocks embedded value within Shire`s portfolio and sharpens focus on core areas reinforcing our leadership in rare diseases

Oncology business provides Servier S.A.S. with an immediate presence in the U.S.,  enhancing its commitment to addressing unmet patient needs in oncology

Dublin, Ireland - April 16, 2018 - Shire plc (LSE: SHP, NASDAQ: SHPG) the leading global biotechnology company focused on rare diseases announces today that it has entered into a definitive agreement with Servier S.A.S. ("Servier") to sell its Oncology business for $2.4 billion.  Shire`s Oncology business includes in-market products ONCASPAR® (pegaspargase), a component of multi-agent treatment for acute lymphoblastic leukemia (ALL) and ex-U.S. rights to ONIVYDE® (irinotecan pegylated liposomal formulation), a component of multi-agent treatment for metastatic pancreatic cancer post gemcitabine-based therapy.  The portfolio also includes Calaspargase Pegol (Cal-PEG), which is under FDA review for the treatment of ALL and early stage immuno-oncology pipeline collaborations.

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

"This transaction is a key milestone for Shire, demonstrating the clear value embedded in our portfolio.  While the Oncology business has delivered high growth and profitability, we have concluded that it is not core to Shire`s longer-term strategy.  We will continue to evaluate our portfolio for opportunities to unlock further value and sharpen our focus on rare disease leadership with selective disposals of non-strategic assets.

"We are confident that Servier will continue to invest in this business and our colleagues who are expected to transfer as part of the transaction in order to meet the needs of cancer patients globally.

"The proceeds from the transaction increase optionality and Shire`s Board will consider returning the proceeds of the sale to shareholders through a shareholder-approved share buyback after the current offer period regarding Takeda`s possible offer for Shire concludes."

Olivier Laureau, Servier Group President, commented:

"The acquisition of Shire`s oncology franchise enables Servier to meet its strategic ambitions to become a global key player in oncology. As an essential step in the evolution of the Group, this acquisition allows us to establish a direct commercial presence in the United States, the world`s leading pharmaceuticals market, and to strengthen our portfolio of marketed products in the territories where Servier is already present. Our goal is to bring these treatments to greater numbers of cancer patients around the world.  We thoroughly look forward to welcoming Shire`s oncology teams who will join Servier after the closing."

Transaction details

Under the terms of the agreement, Servier has agreed to acquire Shire`s Oncology business for a total consideration of $2.4 billion, in cash, upon completion.  In 2017, the Oncology business generated revenues of $262 million. The total consideration represents a revenue multiple of 9.2 times 2017 revenues.  The transaction covers the transfer of Shire`s Oncology business including in-market products ONCASPAR® (pegaspargase), a component of multi-agent treatment for acute lymphoblastic leukemia (ALL) and ex-U.S. rights to ONIVYDE® (irinotecan pegylated liposomal formulation), a component of multi-agent treatment for metastatic pancreatic cancer post gemcitabine-based therapy.  The portfolio also includes Calaspargase Pegol (Cal-PEG), which is under FDA review for the treatment of ALL, and early stage immuno-oncology pipeline collaborations.

The gross assets that are the subject of the transaction are approximately $1.6 billion and the profits attributable to the assets being transferred are approximately $140 million, excluding depreciation, amortization and other direct and indirect costs.

Transaction closing

This transaction constitutes a Class 2 transaction for the purposes of the U.K. listing rules and, as such, Shire shareholder approval is not required. The transaction has been approved by the Board of Directors and is expected to close in the second or third quarter of 2018.

Transaction background

Shire`s Board of Directors initiated the potential divestment of the Oncology business in December 2017.  The process, which commenced in January 2018, identified multiple potential strategic buyers across the U.S., Europe and Japan.