Shire ramps up AbbVie defence

Shire will ramp up its defence against US pharmaceutical bidder AbbVie on Monday as it seeks to convince shareholders of the long-term prospects of the company.

The perennial takeover target was pushed into play on Friday after the US firm said that it had made three separate proposals for the company with the last valuing the business at £27bn, or £46.26 per Shire share. Shire’s board unanimously rejected the offer as “fundamentally undervaluing the company and its prospects as a leader in rare diseases and speciality markets.”

Rather than wait for a fourth approach, Shire will publicly detail its reasons for rejecting AbbVie’s overtures on a call to investors on Monday afternoon and take the opportunity to emphasise its stand-alone value.

City analysts said they believe a deal could be done at around £50 per share, but this could be a squeeze on AbbVie’s financial firepower. Shire and AbbVie declined to comment.

Analysts expect the Irish-based group to flesh out the details behind its boast that it will more than double last year’s product sales to $10bn (£5.8bn) by 2020. It is thought that Shire will instead give a further insight into how it plans to generate $10bn of sales within the next six years and stress the strength of its rare disease platform, which made sales of $2bn alone last year.

Since Shire’s Danish chief executive Flemming Ornsov joined last April he has raised earnings before interest, tax, depreciation and amortisation margin from 37pc to 45pc.

Shire is also expected to give further details on the stages of its new treatment for adult hyperactivity disorder, currently known by its chemical name SHP465.

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