Stocks in the FTSE 100 pharma firm, Shire, dropped sharply on Monday morning after it announced a rival had been given permission to make a generic version of its blockbuster treatment for Attention Deficit Hyperactivity Disorder (ADHD), Adderall XR.
Swiss firm Actavis has been given the all clear by the US Food and Drug Administration to manufacture a generic form of Adderall, which analysts at Nomura estimate is worth around 10% of Shire's total earnings per share.
Little wonder, then, that shortly after the open Shire shares had dropped 10.4%
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In announcing the news Shire admitted "there will be multiple dynamics affecting the overall market following the approval of the Actavis generic".
But the British company maintained it would "...deliver good, full-year 2012 earnings growth."
Nomura still rates Shire as a buy because 40% of its sales are exposed to the US ADHD market which grew at 9% over the last five years.
BS
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