Flemming on what drove immunology growth

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anonymous

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During the 2/14 Q4 2017 earnings call the following question was asked by Annabel Eva Samimy - Stifel, Nicolaus & Co., Inc.

“ I want to ask about immunology... it seems that ...there's somewhat of a lack of understanding what the underlying dynamics are of the base business – of the base growth there. So aside from new product introductions and expansion in China, can you help us understand some of the dynamics that provide that above-market growth for you within immunology?”

Flemming answered
“...we're going to a very dense group of prescribers. Many are hospital-based immunologists, intensive care physicians, and other specialists and that if you look at our product portfolio, there's a huge overlap between the physicians that we go and talk to and that prescribe our products, both for HAE and immunology.
...If I go and talk to physicians, what I hear, wow, I work with you on HAE. I work with you on your subcutaneous portfolio. I work with your IG portfolio that is given intravenously. I'm also in the maribavir trial for anti-CMV in your transplant patients. I'm also in the CINRYZE patients in anti-rejection. So we have a huge interaction and density around a very streamlined customer group. So I think that's been basically better service of our customers, bigger product offering, better contractual situation, and better opportunity to deliver.
...The other thing that is quite clear that has been a huge driver in the U.S. has been the OnePath system. We have I think a state-of-the-art patient service system that, I would say, hand-hold patients from home service to patient reimbursement to other services, and that's been a significant driver for that.”

So what drove US immunology sales growth according to Flemming?
- The doctors “wow” by using multiple products (HAE+subcu+IG) and by being part of Shire’s multiple clinical trials
- OnePath hand-holding patients through reimbursement and “other service”

What does the compliance team and the government think about this explanation?

Full transcript available here:
https://seekingalpha.com/amp/article/4146641-shire-plc-shpg-q4-2017-results-earnings-call-transcript
 






What a crock of poo. I am sure the real answer is "we are jacking up the price to insane levels and the customers haven't had time to switch to a new supplier"

Wait for next year's financials.
 












Wait till you hear about the disastrous contract we got ourselves into in Canada. Shire just signed a 5 year deal for Ig where we are selling our US Ig for 2 1/2 times CHEAPER in Canada. Canada is the 2nd biggest users in the world, and the deal is for 5 years.

Contract starts on April 1, 2018. Wait til the shareholders learn of this. If you think our stock is bad now.....just wait!

Thanks Flemm
 






Wait till you hear about the disastrous contract we got ourselves into in Canada. Shire just signed a 5 year deal for Ig where we are selling our US Ig for 2 1/2 times CHEAPER in Canada. Canada is the 2nd biggest users in the world, and the deal is for 5 years.

Contract starts on April 1, 2018. Wait til the shareholders learn of this. If you think our stock is bad now.....just wait!

Thanks Flemm
 


















Most Plasma Companies keep a healthy reserve of product on hand in case of manufacturing emergencies, slow FDA releases, etc. He saw all that product sitting around and sold it. Little does he realize it take 9-14 months to make a gram of IVIG, SubQ-Ig, or Alpha1. This is the reason we have no supply. If you thought the stock went down when Immunology had a great year, wait till our customers leave due to shortages. He took the page right out of the CINRIZE debacle. She knew the answer to the question and wanted to see if he would come clean.
 






Global demand for Ig is better than its ever been. Although the market is competitive, there's no need to gauge customers as market share will grow for all. HOWEVER, we don't need to be giving the stuff away for free either if we are to keep the investors/shareholders happy.

I did hear the deal in Canada is probably the worst deal Shire has ever gotten themselves into. In Canada they deal with one or two distributors, that's it! And yes, despite their population, they are 2nd biggest users of Ig behind us, but can only use US sourced commercial plasma.

We are selling it to Canada for less than half the US price, and we had to commit to just over 5 million grams in the first year. This deal could be the last nail in our coffin.
 






anonymous said:
Global demand for Ig is better than its ever been. Although the market is competitive, there's no need to gauge customers as market share will grow for all. HOWEVER, we don't need to be giving the stuff away for free either if we are to keep the investors/shareholders happy.

I did hear the deal in Canada is probably the worst deal Shire has ever gotten themselves into. In Canada they deal with one or two distributors, that's it! And yes, despite their population, they are 2nd biggest users of Ig behind us, but can only use US sourced commercial plasma.

We are selling it to Canada for less than half the US price, and we had to commit to just over 5 million grams in the first year. This deal could be the last nail in our coffin.
Click to expand...

I am with Shire but a different division so I really do not understand why or how this is the “last nail in the coffin” can you explain
 






The fool bet his entire bank to jack up immunology sales to hopefully increase the share price and/or push up the price an acquirer would be willing to pay for shire. The bank is empty now and he is about out of options.
 






The Baxalta acquisition was supposed to be Shires saving grace and launch Shire as the largest rare disease company in the world. On paper we look like it, but reality and shareholders have been suspect shortly after the takeover. Why are stock has taken a rapid decline after the acquisition but nobody really knows why. The Ig space is supposed to be very lucrative so it begs the question why Baxter spun-off this portfolio, only to have Baxalta dump it less than a year. Many investors think we paid way too much for this acquisition, and is probably why big stakeholders are reluctant to invest in this company.

Optically, Flemm wants to have major presence in every major country. Canada and Australia are big targets, but CSL has a stronghold in Australia as Grifols does in Spain. Canada seemed like a logical target to have a dominant presence, but not only did we come in at a ridiculous low-ball price, we got 80% of the commercial market. You would think that is great news, but it could have catestrophic consequences if they pull all of the Ig out of the US, especially if the low price was in CAD and not USD. The concern is about potential shortages in the US, and if their is any major disruption in supply (like the Cynrize incident), could damage Shires reputation for a very long time.

Time will tell, but it probably won't take 12 months before we find out.
 






There just seems to be a scam with regard to the immunology sales. With so little Baxalta people left it is hard to believe that shire management came on board and increased the revenue in immunology.
 






This is very telling. The analysts who cover this market know that the strong Ig demand is atypical, and that supply and demand swings come and go and have to be properly managed for sustainability. They can see that Shire's CEO doesn't know how the market works. The market is experiencing atypical demand and it is benefiting everyone, but what is really important is how the companies are preparing for the next market dynamic to sustain growth.

Grifols reported 8% immunoglobulin growth in 2017, and they explained that there has been very strong demand (esp. in the US) and how they are strengthening their supply to meet that demand. They have laid out in detail to investors how they are managing their supply network to maintain market leadership. Grifols' stock is up over +11% this past year.

CSL reported 13% immunoglobulin growth in 2017, and they explained the "atypical market conditions" for product demand, and explained in detail how they are building their growth in SCIG as the fastest growing segment. CSL's stock is up over +40% this past year.

Shire reported 18% immunoglobulin growth in 2017, but could not show in detail where that growth was coming from, nor how they planned to keep it up. When pushed, Flemming talks about how many products the company has for physicians to choose from, a couple of clinical trials that the company is doing, and the patient services organization. Shire's stock is down -27% this past year.

The analysts don't react well to things that appear too good to be true. They want sustainable growth and hate growth rate swings. So if you have huge growth in a volatile area like immunoglobulins they are going to look closely at what comes next in that area. They can see that one of these CEOs is not like the others and the share price evolution tells us what they think.
 






anonymous said:
The fool bet his entire bank to jack up immunology sales to hopefully increase the share price and/or push up the price an acquirer would be willing to pay for shire. The bank is empty now and he is about out of options.
Click to expand...


Yes he did- and lost. With supply shortages, due to him selling off inventory last year, its going to get real desperate around here. Plasma products are not like pills or eye drops where you can manufacturer more for next week.
 


















I've got a feeling projections for 2020 will be more than just a $$$ 2-3 billion dollar deficit. Shire's image can't afford to take another blow like the Cynrize shortage.

God help us all.
 






anonymous said:
There just seems to be a scam with regard to the immunology sales. With so little Baxalta people left it is hard to believe that shire management came on board and increased the revenue in immunology.
Click to expand...

Read Annabel's questions again. She knows that Shire's management didn't do anything to increase Immunology profits other than selling the farm. "lack of understanding". You can tell by his Politician's answer he didn't know what to say and was very uncomfortable. His hand was caught in the plasma jar, and she knows it.
 






Flemm is a bs'ing snakeoil salesman. OpEx will be much higher this year due to operating costs on both the new Ig and Cynrize manufacturing facilities. Tender markets exist in the U.K., Canada and South America. SA is not a well saturated Ig continent, and politics make it tough to do legitimate business. China is also a difficult market to penetrate as the Chinese are busy making manufacturing plants of their own and want to thrive off of the local population. Grifols and CSL are much much further ahead with business relationships there. Canada is also a tender market with Canadian Blood Services, the only distributor for English Canada. The French province has a distributor of their own. Flemm sold both his soul and first born to get that business and apparently has a shady relationship with the distributors CEO. The sheer volume and price we gave our neighbors to the North will kill us and possibly put the US at risk for either shortage and/or a major loss on our profits. Tender markets outside of the US are not the kind of business you want to pursue as it ultimately ends up commoditizing the market and hurts overall demand for Ig.

Annabels questions were direct and to the point, and Flemm just deflected them with bs responses. It was an disrespectful response and I'm sure she saw right through it.

65% growth in Cuvitru, or somewhere around that. Really???? That's your answer??? You should know right to the closest decimal point. But not our infamous leader.

Immunology is the portfolio to follow this year. Let's see if we reach another year of double digit unanswerable growth, or will we tap out because supply couldn't keep up with demand because we gave it all away to other countries.
 






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