Feb. 20 (Bloomberg) -- Shire Plc, the U.K. maker of the attention-deficit drug Adderall XR, agreed to buy New River Pharmaceuticals Inc. for $2.6 billion to gain full control of Vyvanse, a potential successor.

Shire will pay $64 a share for Radford, Virginia-based New River, Shire said today in a statement. That's 9.7 percent more than New River's closing price on Feb. 16. Basingstoke, England- based Shire said demand from investors enabled the company to raise $900 million today in a share sale to help finance the buyout, exceeding the $800 million target.

Chief Executive Officer Matthew Emmens said the acquisition will boost profit growth, beginning in 2009, by increasing Shire's share of the $3.3 billion U.S. hyperactivity-disorder market. Adderall XR, which makes up more than half of the company's sales, will lose patent protection in 2009.

``I'd have thought they would buy the product, not the whole company,'' Navid Malik, an analyst at Collins Stewart in London, said in a telephone interview. ``This shows they're being very aggressive about adding new products.''

The U.S. Food and Drug Administration has yet to approve Vyvanse after sending two letters requesting further data since Oct. 6. Emmens said in an in interview that he is optimistic the FDA approval will come ``any day now'' and that U.S. marketing of Vyvanse will begin in the second quarter.

``Having full control means we can do it our way,'' Emmens said on a conference call with reporters. ``We have pretty good confidence'' that the drug will be approved by the FDA, he added.

Shares Climb

Shire shares climbed 40 pence, or 3.7 percent, to 1,115 pence by the close of trading in London. New River shares jumped $4.84, or 8.3 percent, to $63.19, their highest closing value ever, at 4 p.m. New York time in Nasdaq Stock Market composite trading. When trading in New River stock began in August 2004, the shares were $3.75.

New River has 46 employees, and their future isn't known yet, said a Shire spokesman, Matt Cabrey, in a telephone interview today.

The company's founder and biggest shareholder, Chief Executive Officer Randal J. Kirk, won't join the Shire board, Cabrey said.

Kirk owned about half of the shares, as of Dec. 31, according to the company's statement. He thus is positioned to walk away with about $1.2 billion in proceeds from the sale of the company. New River spokesman Zack Kubow declined to comment on the transaction.

Partners

The two companies had been partners since 2005, and today's agreement means Shire won't have to pay royalties and share the profits on Vyvanse, formerly known as NRP-104. The medicine has patent protection until 2024. Vyvanse may have sales of $1.3 billion by 2010, according to analysts at Citigroup. Adderall XR had sales of $864 million last year.

Vyvanse is one of three new attention deficit medicines Shire plans to introduce this year, in addition to Daytrana, the ADHD patch first marketed in June. Shire expects to seek FDA permission for Vyvanse in adults in the second quarter.

Attention-deficit and hyperactivity disorder affects an estimated 5 million children in the U.S., who struggle to focus and control impulses. While treating the disorder with drugs rather than behavioral therapy is controversial, other medicines available include Novartis AG's Ritalin.

Vyvanse is meant to be a safer alternative to current amphetamine-based therapies and shows less potential for abuse, according to New River. The FDA has delayed the drug as it decides whether those claims can be put on the label.

Advisers

Merrill Lynch and Bear Stearns advised New River. Goldman Sachs and Morgan Stanley acted as financial advisors to Shire.

To pay for the acquisition, Shire plans to issue about 38 million new shares, representing about 7.5 percent of the current outstanding share capital. The company will also issue $2.3 billion in new bonds.

Shire bought Transkaryotic Therapies Inc. for $1.6 billion in 2005, to reduce its dependence on Adderall XR and gain treatments for anemia and rare diseases. The purchase gave Shire Elaprase, the first treatment for Hunter Syndrome, which kills most people with the condition before they reach their 20th birthdays. Elaprase was introduced in August.

2007 Forecast

The acquisition of New River will add experimental treatments for acute pain and hyperthyroidism.

In a separate statement, Shire today said fourth-quarter profit was little changed at $68.6 million, or 13.4 cents a share, from $69 million, or 13.7 cents, a year earlier. Analysts surveyed by Bloomberg News had expected profit of $64.4 million. Revenue climbed 6.9 percent to $497 million.

Shire forecast 2007 revenue growth of 20 percent. Sales, general and administrative costs will rise to as much as $960 million as the company spends money to introduce new medicines.

The company restated its 2005 loss to $578.4 million, compared with the previously reported loss of $436.4 million, to account for a tax amortization benefit linked to in-process research and development acquired with Transkaryotic. The restatement will have no effect on cash flow, Shire said.

To contact the reporter on this story: Etain Lavelle in London at Elavelle1@bloomberg.net.

Last Updated: February 20, 2007 16:10 EST