Shire plc, the global specialty biopharmaceutical company, announced that it has successfully settled all pending litigation in connection with former dissenting shareholders of Transkaryotic Therapies, Inc. (TKT). Shire will pay the same price of $37 per share originally offered to all TKT shareholders at the time of the July 2005 merger, plus interest.

As previously disclosed, before completion of the merger, certain dissenting shareholders holding approximately 11.3 million of TKT shares submitted written demands for appraisal of the fair value of these shares and, as a result, elected not to accept the $37 per share merger consideration offered by Shire. A second lawsuit was brought in March 2007 alleging, among other claims, breaches of fiduciary duty by certain members of TKT's board. The majority of that second lawsuit had been dismissed by the Court at summary judgment in June 2008. A trial date had been set for both cases on December 10th, 2008.

According to a Shire press release, the company will pay $37 per share - the same amount per share paid to non-dissenting shareholders in July 2005 at the time of the merger between Shire and TKT - plus interest. The Delaware Chancery Court has approved dismissal of the case and Shire expects to make payment to the dissenting shareholders on November 7, 2008.

The settlement represents a total payment of $567.5 million, representing consideration at $37 per share of $419.9 million and an interest cost of $147.6m. Although not controlling for this case, under current law, the court presumptively awards interest in appraisal rights cases at a statutorily determined interest rate that is 5 percentage points above the Federal Reserve discount rate (as it varies over the duration of the case). The interest cost for today's settlement uses an interest rate that approximates this statutory rate. This interest rate has been applied on a compound basis to the $419.9 million of consideration for the duration of the time from the merger to the payment of funds. As expected, the total payment of $567.5 million will be met from Shire's existing cash resources and available facilities.

Since the time of the merger and as recorded in Shire's Q3 balance sheet published in its October 28th earnings release, Shire has provided for a potential liability in connection with this litigation, of $419.9 million plus interest of $74.6 million up to September 30, 2008. The additional interest of $73 million, less applicable taxes, will be excluded from Shire's Non GAAP earnings.

Angus Russell, Shire chief executive officer stated: "We are very pleased to have reached this settlement on terms that confirm that Shire paid a full and fair price for TKT in July 2005 at $37 per share."

Shire's strategic goal is to become the leading specialty biopharmaceutical company that focuses on meeting the needs of the specialist physician. Shire focuses its business on attention deficit hyperactivity disorder (ADHD), human genetic therapies (HGT) and gastrointestinal (GI) diseases as well as opportunities in other therapeutic areas to the extent they arise through acquisitions.