-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, BA/e7mLWK6DW03BSrt6If/hKIBIhnLUbV1mzfZeryz+sMb5eLmcLIyVRIkPNf+g6 d9nVCFGHxoYgPaILdk1XZg== 0001005477-00-008425.txt : 20001214 0001005477-00-008425.hdr.sgml : 20001214 ACCESSION NUMBER: 0001005477-00-008425 CONFORMED SUBMISSION TYPE: PRER14A PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20001212 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SHIRE PHARMACEUTICALS GROUP PLC CENTRAL INDEX KEY: 0000936402 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 000000000 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: PRER14A SEC ACT: SEC FILE NUMBER: 000-29630 FILM NUMBER: 787726 BUSINESS ADDRESS: STREET 1: EAST ANTON ANDOVER STREET 2: HAMPSHIRE ENGLAND CITY: ENGLAND SP10 5RG STATE: X0 BUSINESS PHONE: 1264333455 MAIL ADDRESS: STREET 1: EAST ANTON ANDOVER STREET 2: HAMPSHIRE ENGLAND CITY: ENGLAND SP10 5RG PRER14A 1 0001.txt PRELIMINARY REVISED SCHEDULE 14A SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 SCHEDULE 14A INFORMATION Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934 Filed by the Registrant |X| Filed by a Party other than the Registrant |_| Check the appropriate box: |_| Preliminary Proxy Statement |_| Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2) |_| Definitive Proxy Statement |_| Definitive Additional Materials |X| Soliciting Material Pursuant to ss.240.14a-11(c) or ss.240.14a-12 SHIRE PHARMACEUTICALS GROUP plc ________________________________________________________________________________ (Name of Registrant as Specified In Its Charter) ________________________________________________________________________________ (Name of Person(s) Filing Proxy Statement, if other than the Registrant) Payment of Filing Fee (Check the appropriate box): |X| No Fee Required |_| Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11. 1. Title of each class of securities to which transaction applies: -------------------------------------------------------------------- 2. Aggregate number of securities to which transaction applies: -------------------------------------------------------------------- 3. Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): -------------------------------------------------------------------- 4. Proposed maximum aggregate value transaction: -------------------------------------------------------------------- 5. Total fee paid: -------------------------------------------------------------------- |_| Fee paid previously with preliminary materials. |_| Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration number, or the Form or Schedule and the date of its filing. 1. Amount previously paid: -------------------------------------------------------------------- 2. Form, Schedule or Registration Statement No.: -------------------------------------------------------------------- 3. Filing Party: -------------------------------------------------------------------- 4. Date Filed: -------------------------------------------------------------------- The press release and analysts' presentation described below may be deemed to be solicitation materials in respect of the merger of 3829341 Canada Inc. ("Exchangeco"), a wholly-owned subsidiary of Shire Pharmaceuticals Group plc ("Shire"), and BioChem Pharma Inc. ("BioChem"), pursuant to a Plan of Arrangement (the "Plan of Arrangement"). A joint press release announcing the execution of a merger agreement was issued on December 11, 2000 and is attached hereto as Exhibit 99.1. A presentation for analysts on December 11, 2000 that relates to the proposed merger is attached hereto as Exhibit 99.2. In connection with the merger, Shire will be filing a proxy statement with the Securities and Exchange Commission. SECURITY HOLDERS OF SHIRE ARE URGED TO READ THE PROXY STATEMENT WHEN IT BECOMES AVAILABLE BECAUSE IT CONTAINS IMPORTANT INFORMATION REGARDING THE MERGER. Investors and security holders may obtain a free copy of the proxy statement when it becomes available and other documents filed by Shire with the Securities and Exchange Commission in connection with the merger at the Securities and Exchange Commission's web-site at www.sec.gov. Security holders of Shire may also obtain for free a copy of the proxy statement and other documents filed with the Securities and Exchange Commission by Shire in connection with the merger by contacting Clea Rosenfeld, Investor Relations, 44-1264-388-115. Shire and its directors and executive officers may be deemed to be participants in the solicitation of proxies from the security holders of Shire in favor of the merger. The directors and executive officers of Shire include the following: Rolf Stahel, Angus Russell, Wilson Totten, James Cavanaugh, Barry Price, Bernard Canavan, Zola Horowitz, Ronald Nordmann, Joseph Smith and John Spitznagel. As of December 11, 2000, Dr. Cavanaugh beneficially owned approximately 4.9% of Shire's ordinary shares and none of the other foregoing participants individually beneficially owned in excess of 1% of Shire's ordinary shares. Collectively, as of December 11, 2000, the directors and executive officers of Shire may be deemed to beneficially own approximately 5.9% of the ordinary shares of Shire. Security holders of Shire may obtain -2- additional information regarding the interests of such participants by reading the proxy statement when it becomes available. SAFE HARBOR STATEMENT UNDER PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. The above statements that are not historical facts are forward-looking statements that involve risks and uncertainties, including but not limited to, risks associated with the inherent uncertainty of pharmaceutical research, product development and commercialization, the impact of competitive products, patents, and other risks and uncertainties, including those detailed from time to time in periodic reports, including the Annual Report filed on Form 10-K by Shire with the Securities and Exchange Commission. -3- EXHIBIT INDEX EXHIBIT NO. DESCRIPTION 99.1 Press Release dated December 11, 2000 99.2 Analysts' Presentation EX-99.1 2 0002.txt PRESS RELEASE DATED DECEMBER 11, 2000 Embargoed until 7am 11 December 2000 MERGER OF SHIRE PHARMACEUTICALS GROUP PLC WITH BIOCHEM PHARMA INC TO FORM A LEADING GLOBAL SPECIALTY PHARMACEUTICAL COMPANY ANDOVER, UK and LAVAL, CANADA - 11 December 2000 - Shire Pharmaceuticals Group plc (LSE: SHP.L; NASDAQ: SHPGY) ("Shire") and BioChem Pharma Inc. (TSE: BCH; NASDAQ: BCHE) ("BioChem") announced today that they have entered into an agreement to merge the two groups to form a leading global specialty pharmaceutical company. The Merger will be achieved through an exchange of shares, which values, on the basis of the current price of Shire ADSs, each BioChem Share at US$37 (C$54.4) and BioChem at approximately US$4.0 billion (C$5.9 billion) on a fully diluted basis. Transaction highlights The Merger: o creates one of the world's leading global specialty pharmaceutical companies; o broadens and enhances the product portfolio, with leading positions in ADHD and HIV, and deepens the project pipeline, with BioChem's early stage projects complementing those at a later stage in Shire; o brings together complementary strengths of the merger partners, providing exciting future opportunities to market BioChem's development-stage projects through Shire's direct sales infrastructure; o generates strong cashflow for reinvestment in the enlarged group's search and development strategy and, with opportunities for synergies, is expected to be accretive to Shire's earnings in the first full year; and o creates an enlarged group which would have had combined unaudited pro forma revenues for the year ended 31 December 1999 of US$587 million. Shire is an international specialty pharmaceutical company with a strategic focus on four therapeutic areas: central nervous system disorders, metabolic diseases, oncology and gastroenterology. The group has a sales and marketing infrastructure with a broad portfolio of products, with its own direct marketing capability in the US, Canada, UK, Republic of Ireland, France, Germany, Italy and Spain and with plans to add Japan by 2004. Shire also covers other significant pharmaceutical markets indirectly through distributors and sales coverage continues to grow. BioChem is an international specialty pharmaceutical company dedicated to the development and commercialisation of innovative products for the prevention and treatment of human diseases, with a focus on infectious diseases and cancer. BioChem's first therapeutic product, 3TC/Epivir, has become the cornerstone of HIV infection/AIDS combination therapies, most recently being launched as part of GlaxoWellcome's Trizivir therapy. A second therapeutic product, Zeffix, an oral treatment for chronic hepatitis B, is currently being introduced in key markets worldwide by GlaxoWellcome, BioChem's partner for the development and commercialisation of both 3TC/Epivir and Zeffix. It is anticipated that Dr Francesco Bellini, the Honourable James A. Grant and Gerard Veilleux will join the board of the enlarged company in non-executive capacities with effect from Closing. Dr James Cavanaugh will remain as Chairman of the enlarged company and Mr Stahel, Mr Russell and Dr Totten will continue their capacities within the enlarged company as Chief Executive, Group Finance Director and Group R&D Director respectively. BioChem Shareholders will be entitled to receive new Shire Shares or new Shire ADSs in exchange for their BioChem Shares, with an exchange ratio based on the average closing price of a Shire ADS during the last fifteen trading days ending on the third trading day prior to the Closing. BioChem Shareholders resident in Canada will be entitled to elect for Shire Exchangeco Shares instead of Shire Shares or Shire ADSs. BioChem Shareholders will receive $37 worth of Shire Consideration Shares provided the average closing price of a Shire ADS during the last fifteen trading days ending on the third trading day prior to the Closing is between US$47.20 and US$70.80. If the Average Shire ADS price as determined above is greater than or equal to $70.80, the exchange ratio will be fixed at 0.5226 Shire ADSs for each BioChem Share. If the Average Shire ADS price as determined above is less than or equal to US$47.20, the exchange ratio will be fixed at 0.7839 Shire ADSs for each BioChem Share. If the Average Shire ADS price is US$51 9/16 (being the closing price on 8 December 2000) Shire Shareholders would be interested in approximately 53 per cent of the company going forward and BioChem Shareholders would be interested in approximately 47 per cent of the company going forward, assuming all existing BioChem Shareholders exchange their BioChem Shares for Shire Shares pursuant to the Merger and assuming the exercise of all options and warrants in respect of BioChem Shares. On the same basis, the pro forma market capitalisation of the company going forward would be US$8.5 billion ((pound)5.9 billion). A price of $37 represents a 39.6 per cent premium to the closing share price of BioChem on 8 December 2000. The Merger, which is expected to close in the second quarter of 2001, is subject to the approval of Shire and BioChem Shareholders, the absence of any material change affecting BioChem, the accounting of the Merger as a pooling of interests, the obtaining of regulatory approvals and other customary terms and conditions (including admission of the new Shire Shares to be issued pursuant to the Merger to the Official List and to trading on the London Stock Exchange). Shire will continue to have its primary listing in London with additional listings on NASDAQ and the Exchangeco Shares will trade on Toronto Stock Exchange, subject to various approvals. For the nine months ended 30 September 2000, the unaudited results for Shire and BioChem were as follows: Shire (US$m)* BioChem (US$m)* BioChem (C$m)* Revenues 380.6 156.8 230.7 Net income ** 62.0 77.0 113.2 Net assets 681.1 433.4 637.1 Net cash 41.8 186.5 274.1 * Shire reports its results under US GAAP and BioChem reports its results under Canadian GAAP ** Net income is stated prior to a APB 25 charge for Shire and prior to net gains on sale of long term investments for BioChem Details of the Exchange Rates that have been applied are set out at the end of this announcement. Commenting on today's announcement, Rolf Stahel, Chief Executive of Shire, said: "This merger is another important step in building one of the strongest specialty pharmaceutical companies in the world. We see significant benefits from combining these two companies. It will further broaden and diversify our revenue base, strengthen our early phase project pipeline and provide greater financial strength to capitalise on our search and development capability." Francesco Bellini, Chief Executive Officer of BioChem, said: "This is a very positive strategic move for BioChem and its shareholders. The pharmaceutical industry is rapidly consolidating and new leaders are emerging. In this environment, scale and leadership are increasingly important. We are excited by the prospects of the combined company: our two companies complement each other extensively and the combined pipeline and financial strength are impressive. The combined company is on track to become one of the world's leading specialty pharmaceutical companies." THIS SUMMARY SHOULD BE READ IN CONJUNCTION WITH THE ATTACHED PRESS RELEASE Deutsche Bank is acting as financial adviser on the Merger to Shire, supported by Bear Stearns, and Merrill Lynch and West LB Panmure act as brokers to Shire. Chase H&Q and Merrill Lynch act as financial advisers to BioChem in this transaction 3TC, Epivir, Combivir, Trizivr, Epivir-HBV, Heptovir, Heptodin and Zeffix are trademarks of GlaxoWellcome, which is the worldwide licensee of lamivudine. PACIS and Fluviral S/F are all trademarks of BioChem. Second Look is a trademark of Qualia Computing, Inc and BioChem. Analysts' conference calls and presentation A conference call will be held for analysts at 9.30 am London time today, 11 December 2000. Please dial in +44 (0) 20 8781 0598, Password: Shire. Please call Mo Noonan at Financial Dynamics in London on +44 (0) 20 7269 7116 for further details. A further conference call will be held for analysts at 8.00 am (Eastern Standard Time) (1.00 pm London Time). Please dial from the US on 800 810 0924. From outside the US, dial in on +1 913 981 4900. Please call Brian Gill or Paula Schwartz at Financial Relations Board/BSMG in New York on +1 212 661 8030 for details. In addition, a presentation will be held for analysts at noon (Eastern Standard Time) at The New York Palace Hotel, 455 Madison Avenue, New York. There will also be an audio web cast at www.streetfusion.com. Please call Brian Gill or Paula Schwartz on the above number for details. The presentation is available on the "Investor Relations" sections of both Shire's and BioChem's web pages at www.shire.com and www.biochempharma.com. Enquiries: Shire Pharmaceuticals Group plc BioChem Pharma Inc Rolf Stahel, Chief Executive Francesco Bellini, Chief Executive Officer Angus Russell, Group Finance Director Jacques Lapointe, Chief Operating Officer Wilson Totten, Group R&D Director Fred Andrew, Chief Financial Officer + 44 (0) 1264 333 455 Gervais Dionne, Chief Scientific Officer Michelle Roy, Media Clea Rosenfeld, Investor Relations Peter McBride, Investor Relations + 44 (0) 1264 388 115 + 1 450 978 7771 Financial Dynamics (UK PR) Starkman and Associates (US PR) David Yates/Sophie Pender-Cudlip Eric Starkman +44 (0) 20 7831 3113 + 1 212 461 2226 Financial Relations Board/BSMG (US PR) Brian Gill +1 212 455 0929 Jean Young +1 212 455 0988
The "Safe Harbor" Statement Under The Private Securities Litigation Reform Act Of 1995. The Merger described in this announcement, in which BioChem Shareholders would receive Consideration Shares, requires the shareholder approval of Shire and BioChem and the solicitation of such approval has not yet commenced. This announcement is neither an offer to purchase nor the solicitation of an offer to sell any securities. Statements in this press announcement regarding Shire's and BioChem's businesses which are not historical facts, including the potential benefits and synergies of the Merger, are "forward-looking statements" that involve risks and uncertainties. These risks and uncertainties include the abilities of Shire and BioChem to consummate the Merger and realise the benefits and synergies outlined. In connection with the Merger, Shire will file a Proxy Statement with the US Securities and Exchange Commission ("SEC"). Other materials relating to the Merger will also be filed with the SEC. Investors are urged to read the Proxy Statement and other relevant documents to be filed with the SEC because they will include important information. Materials filed with the SEC will be available electronically, without charge, at an internet site maintained by the SEC. The address of that site is http:/www.sec.gov. In addition, the Proxy Statement filed with the SEC will be mailed to BioChem Shareholders and may be obtained without charge from Shire or BioChem upon request. Documents filed with the SEC with respect to the Merger may be obtained without charge from Shire's Head Office at East Anton, Andover, Hampshire, England. Unless Shire otherwise determines, the Proxy Statement will not be sent, directly or indirectly, in or into, or by the use of the mails or any means or instrumentality (including without limitation, telephonically or electronically) of interstate or foreign commerce, or facilities of a national, state or other securities exchange of Australia or Japan and investors in Australia or Japan will not be capable of voting with respect to approving the Merger by any such use, means, instrumentality or facility and this announcement may not be distributed in any such jurisdictions. This press announcement has been issued by Shire Pharmaceuticals Group plc and BioChem Pharma Inc. It has been approved by Deutsche Bank AG London ("Deutsche Bank") solely for the purposes of section 57 of the UK Financial Services Act 1986. Deutsche Bank, which is regulated in the United Kingdom by the Securities and Futures Authority Limited, is acting for Shire and no one else in connection with the Merger and will not be responsible to anyone other than Shire for providing the protections afforded to customers of Deutsche Bank nor for providing advice in relation to the Merger. EMBARGOED FOR RELEASE AT 7AM 11 DECEMBER 2000 MERGER OF SHIRE PHARMACEUTICALS GROUP PLC WITH BIOCHEM PHARMA INC TO FORM A LEADING GLOBAL SPECIALTY PHARMACEUTICAL COMPANY Introduction ANDOVER, UK and LAVAL, CANADA - 11 December 2000 - Shire Pharmaceuticals Group plc (LSE: SHP.L; NASDAQ: SHPGY) ("Shire") and BioChem Pharma Inc. (TSE: BCH; NASDAQ: BCHE) ("BioChem") announced today that they have entered into an agreement to merge the two groups to form a leading global specialty pharmaceutical company. The Merger will be achieved through an exchange of shares, which values, on the basis of the current price of a Shire ADS, each BioChem Share at US$37 (C$54.4) and BioChem at approximately US$4.0 billion (C$5.9 billion) on a fully diluted basis. Shire is an international specialty pharmaceutical company with a strategic focus on four therapeutic areas: central nervous system disorders, metabolic diseases, oncology and gastroenterology. The group has a sales and marketing infrastructure with a broad portfolio of products, with its own direct marketing capability in the US, Canada, UK, Republic of Ireland, France, Germany, Italy and Spain and with plans to add Japan by 2004. Shire also covers other significant pharmaceutical markets indirectly through distributors and sales coverage continues to grow. BioChem is an international specialty pharmaceutical company dedicated to the development and commercialisation of innovative products for the prevention and treatment of human diseases, with a focus on infectious diseases and cancer. BioChem's first therapeutic product, 3TC/Epivir, has become the cornerstone of HIV infection/AIDS combination therapies, most recently being launched as part of GlaxoWellcome's Trizivir therapy. A second therapeutic product, Zeffix, an oral treatment for chronic hepatitis B, is currently being introduced in key markets worldwide by GlaxoWellcome, BioChem's partner for the development and commercialisation of both 3TC/Epivir and Zeffix. The combination of the two companies creates a leading global specialty pharmaceutical group with pro forma revenues for the year ended 31 December 1999 of approximately US$587 million and pro forma net income (pre APB 25 charge and exceptional costs) of approximately US$146 million under US GAAP. BioChem Shareholders will be entitled to receive new Shire Shares or new Shire ADSs in exchange for their BioChem Shares, with an exchange ratio based on the average closing price of a Shire ADS during the last fifteen trading days ending on the third trading date prior to the Closing. BioChem Shareholders resident in Canada will be entitled to elect for Shire Exchangeco Shares instead of Shire Shares or Shire ADSs. BioChem Shareholders will receive $37 worth of Shire Consideration Shares provided the average closing price of a Shire ADS during the last fifteen trading days ending on the third trading day prior to the Closing is between US$47.20 and US$70.80. If the Average Shire ADS price as determined above is greater than or equal to $70.80, the exchange ratio will be fixed at 0.5226 Shire ADSs for each BioChem Share. If the Average Shire ADS price as determined above is less than or equal to US$47.20, the exchange ratio will be fixed at 0.7839 Shire ADSs for each BioChem Share. If the Average Shire ADS price is US$51 9/16 (the closing price on 8 December 2000) Shire Shareholders would be interested in approximately 53 per cent of the company going forward and BioChem Shareholders would be interested in approximately 47 per cent of the company going forward, assuming all existing BioChem Shareholders exchange their BioChem Shares for Shire Shares pursuant to the Merger and assuming the exercise of all options and warrants in respect of BioChem Shares. On the same basis, the pro forma market capitalisation of the company going forward would be US$8.5 billion ((pound)5.9 billion). A price of $37 represents a 39.6 per cent premium to the closing share price of BioChem on 8 December 2000. The Boards of Directors of Shire and BioChem have given unanimous approval to the Merger. It is intended to account for the Merger as a pooling of interests under US GAAP. It is also intended that the Merger will qualify as a tax-free exchange, with BioChem Shareholders resident in Canada having the opportunity to elect for Shire Exchangeco Shares. The Merger is expected to close in the second quarter of 2001, subject to the approval of Shire and BioChem Shareholders, including admission of the New Shire Shares to be issued pursuant to the Merger to the Official List and to trading on the London Stock Exchange, review under the Hart-Scott-Rodino Act and other customary terms and conditions. Deutsche Bank is acting as financial adviser on the Merger to Shire, supported by Bear Stearns, and Merrill Lynch and West LB Panmure act as brokers to Shire. Chase H&Q and Merrill Lynch act as financial advisers to BioChem in this transaction. The enlarged group will continue to be known as Shire Pharmaceuticals Group plc outside of Canada and headquarted at Andover in the UK. The operational headquarters in Canada at Laval will be known as Shire BioChem Inc. Rationale for and benefits of the Merger The Directors of Shire and BioChem believe that the Merger significantly enhances the prospects for the enlarged group, creating an integrated specialty pharmaceutical group with a broad range of marketed products complemented by a growing pipeline of both early and late-stage projects. The Merger capitalises on the complementary skills of the two companies. BioChem's lead optimisation and chemistry expertise will significantly enhance the enlarged group's R&D capability, with BioChem's activities focused on infectious diseases, oncology and vaccines. Shire's global sales infrastructure will enable the appropriate BioChem development stage projects to be taken directly to market. A broader marketed product portfolio BioChem has developed leading positions in the HIV and HBV markets with its key 3TC/Epivir and Zeffix products which are based on the lamivudine compound. 3TC/Epivir has become a cornerstone in the treatment of HIV infection/AIDS, first used in singular form as Epivir and latterly as part of the combination therapies, Combivir and Trizivir. Zeffix is the first and only approved oral anti-viral treatment for hepatitis B and has been approved for use in most Asian markets where the disease is particularly prevalent. BioChem's strength in the HIV infection/AIDS and hepatitis B markets complements Shire's leadership in the Attention Deficit Hyperactivity Disorder (ADHD) market and its therapies in metabolic diseases, oncology and gastroenterology. An enriched project pipeline The enlarged group's key development projects will include Reminyl (Alzheimer's disease), Lambda (hyperphosphatemia) and Dirame (moderate and severe pain) from Shire, and Troxatyl (leukaemia) and frakefamide (moderate and severe pain) from BioChem. Taken together, the enlarged group will have 7 products in registration or Phase III clinical trials, 5 products in Phase II and 11 products in Phase I or pre-clinical development. A stronger R&D platform With three separate sites in Canada and one in the USA, BioChem employs 250 scientists whose activities are focused upon anti-infective and anti-cancer therapies. In addition, BioChem's vaccine research has a number of innovative projects, including a recombinant-protein bacterial vaccine programme conducted in a collaboration with the vaccine research unit of the Laval University Hospital Research Center, and an influenza vaccine programme conducted in a collaboration with SmithKline Beecham. Greater financial resources to pursue future growth opportunities During the year ended 31 December 1999, BioChem generated operating cashflow under Canadian GAAP of US$101.9 million (C$149.8 million). As at 30 September 2000, BioChem had approximately US$87.8 million (C$129.1 million) in indebtedness and US$274.3 million (C$403.2 million) in cash and temporary investments under Canadian GAAP. As at the same date, Shire had indebtedness of US$127.8 million and US$169.6 million in cash and temporary investments. The increased financial resources will assist the enlarged group in its search for new in-licensed products. Information on BioChem BioChem is an international pharmaceutical company dedicated to the development and commercialisation of innovative products for the prevention and treatment of human diseases, with a focus on infectious diseases and cancer. BioChem's first therapeutic product, 3TC/Epivir, has become the cornerstone of HIV infection/AIDS combination therapies, most recently being launched as part of GlaxoWellcome's Trizivir therapy. 3TC/Epivir is the most widely-prescribed antiretroviral for HIV infection/AIDS and is available in over 100 countries. Worldwide sales, including as a component of the combination tablet, Combivir were US$873 million in 1999. BioChem receives royalties from GlaxoWellcome on the worldwide sales of 3TC/Epivir for the treatment of HIV infection/AIDS. 3TC/Epivir is protected by patent until 2010, with further protection expected in the US for the combination products, Combivir and Trizivir. A second therapeutic product, Zeffix, an oral treatment for chronic hepatitis B, is currently being introduced to key markets worldwide by GlaxoWellcome. Zeffix significantly improves liver function and histology in chronic hepatitis B patients and reduces progression to cirrhosis. Zeffix is now available in a number of countries including China, Japan, Taiwan and the USA. Worldwide sales of Zeffix were US$73.1 million for the first nine months of 2000. BioChem receives royalties from GlaxoWellcome on its worldwide sales of Zeffix which is protected by patent until 2013. With approximately 500 employees and operating from three sites in Canada and one in the USA, BioChem has a number of projects at various stages of development, as listed below:
Therapeutic Product / Project area Phase Year of Launch ANTI-INFECTIVES 3TC/Epivir HIV/AIDS Commercialised 1995 Combivir HIV/AIDS Commercialised 1997 Trizivir HIV/AIDS Commercialised 2000 Zeffix HBV Commercialised 1998 BCH-10618 HIV/AIDS Pre-clinical BCH-13520 HIV/AIDS Pre-clinical ANTI-CANCER PACIS Bladder Commercialised 2000 cancer Troxatyl Cancer Phase II OTHER Frakefamide Pain Phase II Second Look Diagnostics Commercialised 2000 VACCINES Fluviral S/F Anti-viral Commercialised Not applicable Injectable cell-culture influenza Anti-viral Phase I Nasal cell-culture influenza Anti-viral Phase I Neisseria Meningitidis Anti-bacterial Phase I Pseudomonas aeruginosa Anti-bacterial Pre-clinical Group B Streptococcus Anti-bacterial Pre-clinical
BioChem's financial results, which are reported under Canadian GAAP, are as follows:
US$m C$m Revenues for the year ended 31 December 1999 197.4 290.2 Net income for the year ended 31 December 1999 101.4 149.1 Revenues for the nine months ended 30 September 2000 156.8 230.7 Net income for the nine months ended 30 September 2000* 77.0 113.2 Net assets as at 30 September 2000 433.4 637.1 Net cash as at 30 September 2000 186.5 274.1
*Net income is stated prior to net gains on sale of long term investments Information on Shire Shire's global search and development expertise has to date successfully provided eight marketed products, of which Reminyl, for the treatment of Alzheimer's disease, has recently been launched in the UK, its first market. The current pipeline of 16 projects includes Reminyl in registration phase in the US and various other markets, SLI 381, Shire's once-a-day formulation of Adderall for ADHD which was submitted to the Food and Drug Administration (FDA) on 3 October 2000, and five others that are post Phase II. Shire is actively seeking to acquire further marketed products and development projects to enhance the potential for future growth. Significant growth has been achieved by Shire over the past five years with sales increasing from US$137.6 million in 1995 to US$401.5 million in 1999, representing an annual increase of 30.7 per cent. This growth has been partly due to Shire's acquisition strategy, resulting in five mergers and acquisitions during the last six years, which has enabled Shire to build an expanded global marketing infrastructure. Shire now has direct marketing capability in seven of the world's eight major pharmaceutical markets. Shire's financial results, which are reported under US GAAP, are as follows: US $m Revenues for the year ended 31 December 1999 401.5 Net income for the year ended 31 December 1999* 52.2 Revenues for nine months ended 30 September 2000 380.6 Net income for the nine months ended 30 September 2000* 62.0 Net assets as at 30 September 2000 681.1 Net cash as at 30 September 2000 41.8 * Net income is stated pre APB 25 charge and exceptional costs Terms of the Merger The Boards of Directors of Shire and BioChem have unanimously approved a definitive Merger Agreement. The summary terms of the Merger are as follows: - - The Merger will be effected by way of the Arrangement, pursuant to which BioChem Shareholders will have the opportunity to exchange their BioChem Shares for new Shire Shares or new Shire ADSs. The Arrangement is intended to be accounted for as a pooling of interests for financial reporting purposes under US GAAP. - - It is also intended that, under the Merger Agreement, BioChem Shareholders resident in Canada will also have the opportunity to elect to dispose of their BioChem Shares in return for new Shire Exchangeco Shares on a tax deferred or roll-over basis for Canadian income tax purposes. - - The Shire Exchangeco Shares will be exchangeable for up to five years, at each Shire Exchangeco shareholder's option, for new Shire Shares on a one-for-one basis or for new Shire ADSs on a one-for-three basis. A Shire Exchangeco Share will provide a holder with a security having economic and voting rights which are virtually identical to those attaching to a Shire Share. - - The exact exchange ratio of new Shire Shares for BioChem Shares, which will be subject to a collar mechanism, will be based on the average price of a Shire ADS during the 15 trading days ending on the third trading date prior to the Closing (the "Average Shire ADS Price"). - - The collar provides a fixed value of stock consideration provided the Average Shire ADS Price at Closing is between US$47.20 and US$70.80. In such circumstances, each BioChem Share will be exchanged for approximately US$37 worth of Consideration Shares. - - In the event that the Average Shire ADS Price is less than or equal to US$47.20, each BioChem Shareholder will receive 0.7839 Shire ADSs for each BioChem Share. In the event that the Average Shire ADS Price is greater than or equal to US$70.80, each BioChem Shareholder will receive 0.5226 Shire ADSs for each BioChem Share. - - Based on an Average Shire ADS Price equal to the closing price of a Shire ADS on 8 December 2000 (the last trading day prior to this announcement) of US$51 9/16, and on a fully diluted basis, Shire Shareholders would be interested in approximately 53% and BioChem Shareholders approximately 47% of the company going forward. - - On this basis, the merger offer would represent a premium of 39.6% over the closing price of US$26.5 per BioChem Share on 8 December 2000 and a premium of 51.0% over the average closing price of BioChem Shares for the last 10 trading days prior to this announcement. - - The Merger Agreement contains non-solicitation provisions as well as mutual break fees payable in certain specified circumstances. In addition, BioChem has granted to Shire an option to subscribe for cash, in certain specified circumstances, newly issued BioChem Shares equivalent to up to 19.9% of BioChem existing issued shares. - - The Merger is contingent upon, among other conditions, the approval of Shire and BioChem Shareholders and the admission of the new Shire Shares, to be issued pursuant to the Merger, to the Official List and to trading on the London Stock Exchange. - - The Directors of Shire, who have received financial advice from Deutsche Bank, have resolved unanimously to recommend Shire Shareholders to vote in favour of the Merger. In giving advice, Deutsche Bank has placed reliance on the Directors of Shire's commercial assessment of the Merger. The Directors of BioChem, who have been advised by Chase H&Q and Merrill Lynch, unanimously recommend BioChem Shareholders to vote in favour of the Merger. New Shire Directors It is anticipated that Dr Francesco Bellini, the Honourable James A. Grant and Gerard Veilleux will join the board of the enlarged company in non-executive capacities. Dr James Cavanaugh will remain as Chairman of the enlarged company and Mr Stahel, Mr Russell and Dr Totten will continue in their capacities with the enlarged company as Chief Executive, Group Finance Director and Group R&D Director respectively. Dr. Bellini was a co-founder of BioChem in 1986 and is the company's current Chairman and Chief Executive Officer. Dr. Bellini received a B.Sc. in chemistry from Loyola College in Montreal in 1972, and a Ph.D. in organic chemistry from the University of New Brunswick in 1977. James Grant, a Director of BioChem since 1986, is a partner with the law firm of Stikeman, Elliot in Montreal. Mr. Grant, who also sits on the boards of several other prominent Canadian corporations, attended McGill University receiving a B.A. in arts in 1958 and a B.C.L. in law in 1961. Gerard Veilleux joined the BioChem Board in 1999. He is President of Power Communications Inc. and Vice-President of Power Corporation, a diversified management and holding company. Mr. Veilleux is a director of several public and private companies as well as a member of the Board of Governors of McGill University. He has a Master's degree in public administration from Carleton University and a Bachelor of Commerce from Laval University. Financial Information Shire will continue to report primarily under US GAAP. Shareholders may elect to receive full UK GAAP accounts in addition to US GAAP accounts. It is intended that the Merger will be accounted for as a pooling of interests under US GAAP. Under UK GAAP, the Merger will be accounted for as a purchase. Under US GAAP, the combined unaudited pro forma profit and loss account of Shire and BioChem for the year ended 31 December 1999 is as follows: Pro forma Information
Shire BioChem Total Growth $000 $000 $000 '99 v '98 Revenue 401,532 185,694* 587,226 30% Cost of sales (93,475) (9,573) (103,048) -- R&D (77,503) (60,251) (137,754) (47%) Selling & G&A (130,855) (17,781) (148,636) (22%) EBITDA 99,699 98,089 197,788 50% Depreciation & amortisation (28,598) (5,574) (34,172) (14%) -------- ------- -------- ----- Operating income 71,101 92,515 163,616 61% Interest receivable 7,349 5,066 12,415 (5%) Interest payable (9,742) (1,902) (11,644) (75%) Other, net (475) 16,098 15,623 120% -------- ------- -------- ----- Income before taxes, APB 25 charge & exceptionals 68,233 111,777 180,010 536% Income taxes (16,062) (6,500) (22,562) (179%) -------- ------- -------- ----- Net income from continuing operations pre APB 25 charge & exceptionals 52,171 105,277 157,448 679% (Loss) from discontinued operations, net of tax -- (11,946) (11,946) (904%) -------- ------- -------- ----- Net income before APB 25 charge & exceptionals 52,171 93,331 145,502 665% Exceptional items (135,236) -- (135,236) nm APB 25 charge (11,933) -- (11,933) (119%) -------- ------- -------- ----- Net (loss)/income (94,998) 93,331 (1,667) (112%) -------- ------- -------- -----
* Includes CliniChem revenue of $49,296k The financial information relating to Shire contained in this announcement does not constitute Shire's statutory accounts within the meaning of section 240 of the Companies Act. Statutory accounts for the year ended 31 December 1999 have been delivered to the Registrar of Companies of England and Wales. Arthur Andersen, Shire's auditors, have made a report on them under section 235 of the Act and such report was not qualified and contained no statement under section 237 (2) or (3) of the Act. The impact of the Merger on Shire's earnings per share will depend on the number of Consideration Shares to be issued pursuant to the Merger. With opportunities for synergies resulting from the Merger, the Directors of Shire expect it to be earnings accretive for Shire's earnings in the first full year. However, a substantial one-time restructuring charge is expected at the time of Closing. Litigation BioChem, together with GlaxoWellcome, its partner in the commercialisation of 3TC and Zeffix, is a defendant in certain patent litigation brought against them by Emory University regarding patent infringement of US sales of lamivudine. The Directors of Shire believe that the US Patent Office may deliver its ruling in the first half of 2001 and possibly prior to the Closing. On the basis of all facts and information disclosed by BioChem to Shire as at the date of the Merger Agreement, the outcome of the proceedings instituted by Emory University in the United States would not, for the purposes of the Agreement, be considered to have a material adverse change on BioChem. Consequently, such ruling should not itself cause or permit Shire to terminate the Merger Agreement. With advice from external counsel, the Directors of Shire have assessed the probability of receiving such an adverse ruling and have taken into account such considerations in agreeing to the economic and contractual terms of the Merger. 3TC, Epivir, Combivir, Trizivr, Epivir-HBV, Heptovir, Heptodin and Zeffix are trademarks of GlaxoWellcome, which is the worldwide licensee of lamivudine. PACIS and Fluviral S/F are all trademarks of BioChem. Second Look is a trademark of Qualia Computing, Inc and BioChem. The "Safe Harbor" Statement Under The Private Securities Litigation Reform Act Of 1995. The Merger described in this announcement, in which BioChem Shareholders would receive Consideration Shares, requires shareholder approval of Shire and BioChem and the solicitation of such approval has not yet commenced. This announcement is neither an offer to purchase nor the solicitation of an offer to sell any securities. The offer of Consideration Shares as merger consideration to BioChem Shareholders will be made only through a Proxy Statement which will be sent to those shareholders. Statements in this press announcement regarding Shire's and BioChem's businesses which are not historical facts, including the potential benefits and synergies of the Merger, are "forward-looking statements" that involve risks and uncertainties. These risks and uncertainties include the abilities of Shire and BioChem to consummate the Merger and realise the benefits and synergies outlined. In connection with the Merger, Shire will file a registration statement with the US Securities and Exchange Commission ("SEC"). Other materials relating to the Merger will also be filed with the SEC. Investors are urged to read the Proxy Statement and other relevant documents to be files with the SEC because they will include important information. Materials filed with the SEC will be available electronically, without charge, at an internet site maintained by the SEC. The address of that site is http:/www.sec.gov. In addition, the Proxy Statement filed with the SEC will be mailed to BioChem Shareholders and may be obtained without charge from Shire or BioChem upon request. Documents filed with the SEC with respect to the Merger may be obtained without charge from Shire's Head Office at East Anton, Andover, Hampshire, England. Unless Shire otherwise determines, the Proxy Statement will not be sent, directly or indirectly, in or into, or by the use of the mails or any means or instrumentality (including without limitation, telephonically or electronically) of interstate or foreign commerce, or facilities of a national, state or other securities exchange of Australia or Japan and investors in Australia or Japan will not be capable of voting with respect to approving the Merger by any such use, means, instrumentality or facility and this announcement may not be distributed in any such jurisdictions. This press announcement has been issued by Shire Pharmaceuticals Group plc and BioChem Pharma Inc. It has been approved by Deutsche Bank AG London ("Deutsche Bank") solely for the purposes of section 57 of the UK Financial Services Act 1986. Deutsche Bank, which is regulated in the United Kingdom by the Securities and Futures Authority Limited, is acting for Shire and no one else in connection with the proposed merger and will not be responsible to anyone other than Shire for providing the protections afforded to customers of Deutsche Bank nor for providing advice in relation to the proposed merger. Definitions In this document, the following expressions have the following meanings, unless the context requires otherwise: "Arrangement" the plan of arrangement, pursuant to section 192 of the Canada Business Corporations Act, involving Shire, BioChem and Exchangeco "Bear Stearns" Bear, Stearns & Co. Inc. "BioChem" BioChem Pharma Inc, a company incorporated under the laws of Canada "BioChem Shareholders" the holders of BioChem Shares "BioChem Shares" the outstanding common shares in the capital of BioChem Pharma Inc "Canadian GAAP" generally accepted accounting principles in Canada "Chase H&Q" Chase H&Q, a division of Chase Securities "Companies Act" or the "Act" the Companies Act 1985 (as amended) "Closing" the closing of the Arrangement "Deutsche Bank" Deutsche Bank AG, London "Exchangeco" 3829341 Canada Inc, a company incorporated under the laws of Canada and being an indirect wholly owned subsidiary of Shire "GlaxoWellcome" GlaxoWellcome plc, a company incorporated in England "Merger" the proposed acquisition of all of the share capital of BioChem, on the terms and conditions set out in the Merger Agreement, to be effected pursuant to the Arrangement "Merger Agreement" the merger agreement dated as of 10 December 2000 among BioChem, Shire and Exchangeco "Merrill Lynch" Merrill Lynch & Co. Inc in its capacity as adviser to BioChem and Merrill Lynch International in its capacity as broker to Shire, as the context requires "Official List" the official list of the United Kingdom Listing Authority "Shire" Shire Pharmaceuticals Group plc, a company incorporated in England "Shire ADSs" American Depository Shares, issuable upon deposit of Shire Shares, each representing three Shire Shares "Shire Consideration Shares" the new Shire Shares, new Shire ADSs and or "Consideration Shares" new Shire Exchangeco Shares to be issued pursuant to the Merger Agreement "Shire Exchangeco Shares" the exchangeable shares to be created in the capital of Exchangeco, exchangeable for Shire Shares or Shire ADSs in accordance with the rights attaching to such exchangeable shares "Shire Group" Shire and its subsidiaries and subsidiary undertakings "Shire Shareholders" the holders of Shire Shares "Shire Shares" ordinary shares of 5p each in the capital of Shire SmithKline Beecham SmithKline Beecham plc, a company incorporated in England "UK" or "United Kingdom" the United Kingdom of Great Britain and Northern Ireland "UK GAAP" generally accepted accounting principles in the United Kingdom "US GAAP" generally accepted accounting principles in the United States "US" or "United States" the United States of America, its territories and possessions, any State of the United States of America and the District of Columbia, and all other areas subject to its jurisdiction "West LB Panmure" West LB Panmure Limited Exchange Rates Values throughout this announcement have been translated from Canadian dollars to US dollars (for illustration purposes only) using an exchange rate of C$1:US$ 1.47 and from US dollars to UK sterling (for illustrative purposes only) using an exchange rate of(pound)1: US$1.44 Unless stated otherwise, "US$" refers to the currency of the United States of America, "C$ "refers to the currency of Canada and "(pound)" refers to the currency of the United Kingdom. EX-99.2 3 0003.txt ANALYSTS' PRESENTATION 1 [LOGO] BIOCHEM PHARMA [LOGO]SHIRE - -------------------------------------------------------------------------------- Proposed Merger December 2000 - -------------------------------------------------------------------------------- 2 [LOGO] BIOCHEM PHARMA [LOGO]SHIRE ....a merger of two of the most profitable, fast growing, publicly traded, speciality pharmaceutical companies... 3 Comment on "Forward-Looking Statements" The statements made during today's presentation, or in response to questions during the Question & Answer period, that are not historical facts, are forward-looking statements that involve risks and uncertainties, including but not limited to, risks associated with the inherent uncertainty of pharmaceutical research, product development and commercialisation, the impact of competitive products, patents, and other risks and uncertainties, including those detailed from time to time in periodic reports, including the F-4 Prospectus and the Annual Report filed on Form 10K by Shire with the Securities and Exchange Commission. [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 4 Section 57 Financial Services Act This presentation does not constitute an offer to sell or issue, or a solicitation of any offer to purchase or subscribe for, any ordinary shares in the Company, nor shall it form the basis of, or be relied upon in connection with, any contract for such purchase or subscription. No representation or warranty, express or implied, is made or given by the Company as to the accuracy or completeness of the information or the opinions contained in this presentation and no liability is accepted for any such information or opinions. This document is for distribution in the United Kingdom to persons of a kind described in Article 11(3) of the Financial Services Act 1986 (Investment Advertisements) (Exemptions) Order 1996. It is not intended to be distributed or passed on, directly or indirectly, to any other class of persons. This document is being supplied to you solely for your information and may not be reproduced, further distributed to any other person or published, in whole or in part, for any purpose. [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 5 The Merger described in this presentation and in the press release dated 11 December 2000 (the "Press Release"), in which BioChem Shareholders would receive Consideration Shares, requires the shareholder approval of Shire and BioChem and the solicitation of such approval has not yet commenced. In connection with the Merger, Shire will file a registration statement with the US Securities and Exchange Commission ("SEC") which will include a Prospectus and Proxy Statement. Other materials relating to the Merger will also be filed with the SEC. Investors are urged to read the Prospectus and Proxy Statement and other relevant documents to be filed with the SEC because they will include important information. Unless Shire otherwise determines, the Prospectus and Proxy Statement will not be sent, directly or indirectly, in or into, or by the use of the mails or any means or instrumentality (including without limitation, telephonically or electronically) of interstate or foreign commerce, or facilities of a national, state or other securities exchange of Australia or Japan and investors in Australia or Japan will not be capable of voting with respect to approving the Merger by any such use, means, instrumentality or facility and this announcement may not be distributed in any such jurisdictions. Deutsche Bank, which is regulated in the United Kingdom by the Securities and Futures Authority Limited, is acting for Shire and no one else in connection with the Merger and will not be responsible to anyone other than Shire for providing the protections afforded to customers of Deutsche Bank nor for providing advice in relation to the Merger. Terms used in this presentation shall have the same meaning as those definitions in the "Press Release". [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 6 Merger benefits o Broadens and enhances product portfolio o Leading products in ADHD and HIV o 5 products in growth phase o Deepens pipeline and R&D capability o 12 late-stage products in Phase II+ o Enhanced lead optimisation/chemistry o Enhanced access to Biotech companies and universities o Leveraging of Shire marketing infrastructure o Strong cash flow to reinvest in search & development strategy o Larger, more diversified portfolio [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 7 Combined company overview Business Innovation, specialty pharma Function Search & development plus marketing Geography Direct marketing in 7 of the 8 key markets Major Therapeutic CNS, Oncology, Antivirals, Vaccines Areas [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 8 Financial dimensions 199 pro forma combined(1) o US$ 587m revenues(1)(2) o US$ 164m operating income(1)(3) o Operating margin: 28%(3) o US$ 138m R&D (23% of revenues)(1) o US$ 8.5bn market capitalisation(4) (1) Source: Shire and BioChem Pharma management. Based on an average exchange rate over the period of C$1.49 per US$ (2) Includes CliniChem revenues of US$49.3m (3) Pre APB25 charge (4) As at December 8th 2000 on a fully diluted basis [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 9 Key drivers of revenue growth(1) 2001-2003 Adderall/SLI 381(2) 3TC(TM)/Combivir(TM)/Trizivir(TM)(3) Agrylin Pentasa Carbatrol Zeffix(TM)(3) Second Look (CADx) Reminyl(2) Lambda(2) (1) Ranked by latest twelve months 9/30/00 (LTM) sales (2) Subject to relevant regulatory approvals (3) 3TC, Combivir, Trizivir and Zeffix are trademarks of GlaxoWellcome [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 10 Broadens product portfolio Last Twelve Months (LTM) 9/30/2000 ------------------------------------------------- Revenues (US$m) YoY% growth Market share(2) --------------- ----------- --------------- Adderall 204.1 +71% 33% 3TC(1) 125.5 +3% 55%(3) Agrylin 47.4 +46% 15% Pentasa 46.0 -18% 18% Carbatrol 23.2 +96% 25% ProAmatine 20.1 -5% 20% Zeffix(1) 10.9 +445% 100% (1) Trademarks of GlaxoWellcome. Royalty income plus Canadian product sales (2) Market share based on IMS prescription data (3) Market share based on nucleoside analog monotherapy and combination therapy product revenues; moving 13 week total prescriptions Source: Shire Management and BioChem Pharma management. Assumes an average exchange rate of C$1.47 per US$ [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 11 3TC Franchise: Epivir/Combivir/Trizivir(1) o Foundation for HIV/AIDS therapy - primary component of many combination therapies o Nucleoside analog reverse transcriptase inhibitor o US$125.5 million LTM revenues(2) o Introduction of a once-a-day dosage and encouraging data on resistance profile could sustain future growth o Patent protection through 2010(3) (1) 3TC, Epivir, Combivir and Trizivir are trademarks of GlaxoWellcome (2) Royalty income and Canadian product sales (3) Further protection expected on combinations until 2018 [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 12 Zeffix(TM) o Only approved oral treatment for Hepatitis B o Approximately 30 million active chronic HBV sufferers in China and Japan o US$10.9 million LTM revenues(1) o Launched in Japan November 2000 o A key growth driver for combined group o Patent protection through 2013 (1) Royalty income and Canadian product sales [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 13 Querterly Zeffix(TM) sales [The following table was depicted as a bar chart in the printed material.] Q1 99 Q2 99 Q3 99 Q4 99 Q1 00 Q2 00 Q3 00 ----- ----- ----- ----- ----- ----- ----- East 0.8 2.2 7.9 13.3 20.0 25.0 28.1 West North [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 14 Combined LTM 9/30/00 product sales and royalties [The following table was depicted as a pie chart in the printed material.] Adderall 33% 3TC(1) 21% Agrylin 8% Pentasa 8% Carbatrol 4% ProAmatine 3% OTC 3% Calciums 3% Zeffix(1) 2% Fluviral 1% Others 14% Combined Total: US$611m (1) Royalty income stream from GlaxoWellcome sales and Canadian product sales; Trademarks of GlaxoWellcome. Under agreement, BioChem receives royalties from GlaxoWellcome on sales of lamivudine in the treatment of HIV/AIDS (3TC/Epivir/Combivir/Trizivir) and HBV (Zeffix/Zefix/Epivir-HBV/Heptovir/Heptodin) Source: Shire and BioChem management. Based on an average exchange rate over the period of C$1.47 per US$ [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 15 Combined LTM 9/30/00 sales and royalties by therapeutic area [The following table was depicted as a pie chart in the printed material.] CNS 39% Antiviral 22% Oncology 8% GI 8% Metabolic 6% OTC 3% Other 14% Combined Total: US$611m Source: Shire and BioChem management. Based on an average exchange rate over the period of C$1.47 per US$ [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 16 Geographic product rights US Canada Europe Japan Epivir/Combivir/Trizivir X(1) Adderall/DextroStat X Agrylin X X X X Pentasa X Carbatrol X X X X Zeffix X(1) ProAmatine X X X(2) Reminyl X(2) Second Look X X X X X = already marketed X = rights owned, future potential market (1) Joint venture with GlaxoWellcome (2) UK / Ireland only [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 17 Research and Development [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 18 Enhanced R&D capability Complementary skills Shire strengths ----------------------------------------------------> Lead Clinical / optimisation Preclinical Regulatory Marketing - ------------------------------------------------> BioChem Strengths In complementary therapeutic areas [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 19 Development pipeline - ---------------- ---------- -------- ------------- ----- Therapeutic Area PC/Phase I Phase II Phase III/Reg Total - ---------------- ---------- -------- ------------- ----- - ---------------- CNS 5 1 4 10 - ---------------- - ---------------- Antiviral 2 0 0 2 - ---------------- - ---------------- Oncology 1 1 2 4 - ---------------- - ---------------- Vaccines 3 0 0 3 - ---------------- - ---------------- Metabolic / GI 0 3 1 4 - ---------------- - ---------------- ------------------------------------------------------ Total 11 5 7 23 - ---------------- ------------------------------------------------------ ------------------------------------------ 11 early stage projects, 12 late stage ------------------------------------------ [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 20 Post Phase II Pipeline
- --------------------------------------------------------------------------------------------- Product Indication Phase II Phase III Registration Marketed - --------------------------------------------------------------------------------------------- Central Nervous System Reminyl (galantamine) Alzheimer's disease X SLI 381 (Adderall once daily) ADHD X Dirame Moderate to severe pain X Frakefamide Moderate to severe pain(1) X SPD 417 Bipolar disorder X Oncology / Haematology Agrylin Thrombocythemia X Troxatyl leukemia X SPD 424 Prostate cancer X Metabolic disease Lambda Hyperphosphatemia X Gastroenterology Balsalazide Ulcerative colitis X Emitasol Diabetic gastroparesis X Pentasa 500mg Ulcerative colitis X
(1) Frakefamide acts peripherally [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 21 CNS (Alzheimer's disease) o Reminyl(TM)(galantamine) o Novel dual mode of action - acetylcholinesterase inhibitor - nicotinic modulator o First European launch (UK) 21 Sept 2000 - further EU launches planned(1) o FDA approvable letter Aug 2000 - launch planned H1 2001(2) o Japanese launch expected 2003(1) o Co-development and licensing agreement with Janssen (1) Subject to regulatory approval (2) Subject to final approval [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 22 CNS (ADHD) o SLI 381 o Novel, once a day formulation of Adderall o First results presented in Oct 2000 o NDA submitted early - 3 Oct 2000 o Anticipated launch in Q4 2001(1) o Adderall new line extensions o Launched in December 2000 o Allows increased dosing flexibility (1) Subject to regulatory approval [LOGO] BIOCHEM PHARMA [LOGO]SHIRE CNS (Pain control) o Dirame o Oral centrally acting analgesic for moderate to severe pain o Opiate partial agonist and antagonistic activity o Studying addiction potential (key for sales value) o Phase III - US for chronic pain, additional work planned o Global rights owned by Shire o Anticipated launch by 2003(1) o Frakefamide o Intravenous, peripherally acting opiate analgesic for moderate to severe pain o Phase II for acute pain o Designed to avoid centrally mediated opioid side effects o Partnered with AstraZeneca for all regions, except Canada (1) Subject to regulatory approval [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 24 Oncology (Haematology) o Agrylin (anagrelide) o For elevated platelet count (eg Essential thrombocythemia) o Platelet specific o Marketed in US and Canada by Shire o Planning registration in Europe, in Phase I in Japan o Orphan drug status in US and Japan o Shire owns worldwide rights [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 25 Oncology o Troxatyl(TM) (troxacitabine) o DNA polymerase inhibitor o Phase II development for leukemia (AML, CML-BP) o 73% of AML patients demonstrated a reduction in leukemia cells in a Phase IIa trial o Further Phase II monotherapy trials and Phase I/II combination trials are ongoing o Worldwide commercialisation rights owned [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 26 Foznol(TM) (Lambda) o Phosphate binder for patients in end-stage renal failure o Major clinical need for non-calcium, non-aluminium based therapies o Europe o completing Phase III, filing Q1 2001 o US o end 2001 filing anticipated(1) o Global rights owned o development underway in Japan (end Phase I)(1) (1) Subject to regulatory approval [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 27 US Canada Europe Japan Reminyl X X X(1) X Dirame X X X X Adderall LA (SLI 381) X X X X Frakefamide X Carbatrol (incl bipolar) X X X X SPD 421 X X X X Agrylin X X X X Troxatyl X X X X SPD 424 X X X X Foznol (Lambda) X X X X Balsalazide X Pentasa 500mg X Recombinant Vaccines X X X X X = already marketed X = rights owned, future potential market (1) Except UK/Ireland, where Shire owns the rights [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 28 Headline merger terms o Fixed price offer of US$37, subject to cap and floor o premium of 39.6% over BioChem's closing price on December 8, 2000 o Values BioChem(1) at approximately US$4.0 billion o Cap and floor set: Shire ADS (US$) Terms $47.20 - $70.80 Fixed price of US$37 < $47.20 Fixed exchange ratio of 0.7839 > $70.80 Fixed exchange ratio of 0.5226 o Merger agreement contains termination clauses and 19.9% option o Closing expected Q2 2001(2) o Pro forma market capitalisation of US$8.5 billion(3) (1) Fully diluted share capital (2) Subject to required approvals (3) As of December 8, 2000 on a fully diluted basis [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 29 Shire historical financial performance (US$m) 1998 1999 9M to 30/9/00 ---- ---- ------------- Revenue 309.0 401.5 380.6 Cost of sales (95.0) (93.5) (67.4) Gross profit 214.0 308.0 313.2 R&D (59.3) (77.5) (86.3) Selling and G&A (101.0) (130.9) (112.6) ====== ====== ====== EBITDA 53.7 99.6 114.3 (% margin) 17% 25% 30% Operating income 28.5 71.1 91.5 (% margin) 9% 18% 24% Net interest (0.1) (2.4) (4.3) Other income/(expense) 0.4 (0.5) 0.1 Tax (3.0) (16.1) (25.3) ====== ====== ====== Net income(1) 25.8 52.1 62.0 (1) Net income stated prior to APB25 charge and exceptionals [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 30 BioChem historical financial performance (US$m) 1998(1) 1999(1) 9M to 30/9/00(2) ------- ------- ---------------- Revenue 141.5(4) 185.7(3) 156.8(4) Cost of sales (8.0) (9.6) (9.8) Gross profit 133.5 176.1 147.0 R&D (34.4) (60.3) (34.8) Selling and G&A (21.1) (17.8) (20.4) ====== ====== ====== EBITDA 78.0 98.0 91.8 (% margin) 55% 53% 59% Operating income 73.4 92.5 86.5 (% margin) 52% 50% 55% Net interest 6.5 3.2 0.0 Other (expense)/income (81.6) 4.1 94.5 Tax (5.1) (6.5) (8.1) ====== ====== ====== Net (loss)/income (6.8) 93.3 172.9 (1) US GAAP (2) Canadian GAAP at an average exchange rate of C$1.47 per US$ (3) Includes CliniChem revenues of US$49.3m in 1999 (4) Also includes CliniChem revenues [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 31 Unaudited pro forma Shire and BioChem US GAAP historical financial performance (US$m) 1998 1999 ---- ---- Revenue 450.5(1) 587.2(2) Cost of sales (103.0) (103.0) Gross profit 347.5 484.2 R&D (93.6) (137.8) Selling and G&A (122.1) (148.6) ====== ====== EBITDA 131.8 197.8 (% margin) 29% 34% Operating income 101.8 163.6 (% margin) 23% 28% Net interest 6.4 0.8 Other (loss)/income (81.1) 3.7 Tax (8.1) (22.6) ====== ====== Net income(3) 19.0 145.5 (1) Includes CliniChem revenues (2) Includes CliniChem revenues of US$49.3m in 1999 (3) Net income stated prior to APB25 charge and exceptionals [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 32 Chairman and Executive Directors Dr James Cavanaugh Chairman Rolf Stahel Chief Executive Dr Wilson Totten Group R&D Director Angus Russell Group Finance Director New non-executive directors to be appointed on closing from the BioChem Pharma board: Dr. Francesco Bellini, Ph.D. Hon. James A. Grant Gerard Veilleux [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 33 Summary o Leadership in ADHD and HIV o More products and projects o Complementary skills o Enhanced growth prospects o Financially attractive o Targeted to be earnings enhancing within one year after closing o Strong combined cash flow o Opportunities for synergies o Increase in net cash position of US$186 million(1) o Stronger search capabilities (1) BioChem's net cash and temporary investments position as at September 30, 2000 under Canadian GAAP [LOGO] BIOCHEM PHARMA [LOGO]SHIRE 34 [LOGO] BIOCHEM PHARMA [LOGO]SHIRE ....a merger of two of the most profitable, fast growing, publicly traded, speciality pharmaceutical companies... -----END PRIVACY-ENHANCED MESSAGE-----