content: FORM 10-Q
                         SECURITIES AND EXCHANGE COMMISSION
                               Washington, D.C. 20549
  
                 QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                        THE SECURITIES EXCHANGE ACT OF 1934
                      For the Quarter Ended September 30, 2002
  
  
                           Commission File Number: 0-29630
  
                           SHIRE PHARMACEUTICALS GROUP PLC
               (Exact name of registrant as specified in its charter)
  
  
                      England and Wales                           98-0359573
                (State or other jurisdiction                   (I.R.S. Employer
              of incorporation or organization)              Identification No.)
  
      Hampshire International Business Park, Chineham,
               Basingstoke, Hampshire, England                     RG24 8EP
          (Address of principal executive offices)                (Zip Code)
  
                                   44 1256 894 000
                (Registrant's telephone number, including area code)
  
  
  Indicate by check mark whether the registrant (1) has filed all reports required
  to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
  the preceding 12 months, and (2) has been subject to such filing requirements
  for the past 90 days.
  
                                                              Yes  X    No  ___
  
  
  Indicate the number of shares outstanding of each of the issuer's classes of
  Common Stock, as of the latest practical date.
  
              Class                             Outstanding at October 31, 2002
  Common Stock: Ordinary Shares                           501,333,970
  
  
  
  <PAGE>
  
  
  
  THE "SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT
  OF 1995
  
  Statements included herein that are not historical facts, are forward-looking
  statements. Such forward-looking statements involve a number of risks and
  uncertainties and are subject to change at any time. In the event that such
  risks or uncertainties materialize, Shire's results could be materially
  affected. The risks and uncertainties include, but are not limited to, risks
  associated with the inherent uncertainty of pharmaceutical research, product
  development, manufacturing and commercialization, the impact of competitive
  products, including but not limited to the impact of same on Shire's ADHD
  franchise, patents, government regulation and approval, including but not
  limited to the expected approval date of lanthanum carbonate (FOSRENOL(TM)), and
  other risks and uncertainties detailed from time to time in our filings,
  including the Annual Report filed on Form 10-K by Shire with the Securities and
  Exchange Commission.
  
  
  <PAGE>
  
  
  PART I.  FINANCIAL INFORMATION
  
  ITEM 1.  Financial Statements
  
  <TABLE>
  <CAPTION>
  
                           SHIRE PHARMACEUTICALS GROUP PLC
                             CONSOLIDATED BALANCE SHEETS
           (In thousands of U.S. dollars, except share and per share data)
  
                                                                                       (Unaudited)
                                                                                     September 30,          December 31,
                                                                                              2002                  2001
  ASSETS                                                                               -----------           -----------
  Current assets:
  <S>                                                                                      <C>                   <C>
  Cash and cash equivalents                                                                694,615               118,040
  Marketable securities and other current asset investments                                268,665               723,911
  Accounts receivable, net                                                                 171,493               193,913
  Inventories, net                                                                          61,485                46,690
  Deferred tax asset                                                                        24,116                19,430
  Prepaid expenses and other current assets                                                 51,124                38,571
                                                                                      ------------          ------------
  Total current assets                                                                   1,271,498             1,140,555
  
  Investments                                                                               76,639                68,743
  Property, plant and equipment, net                                                       127,639               113,347
  Intangible assets, net                                                                   574,197               549,044
  Deferred tax asset                                                                         2,726                12,874
  Other assets                                                                              23,530                26,168
                                                                                      ------------          ------------
  Total assets                                                                           2,076,229             1,910,731
                                                                                      ------------          ------------
  LIABILITIES AND SHAREHOLDERS' EQUITY
  Current liabilities:
  Current instalments of long-term debt                                                        946                 4,325
  Accounts and notes payable                                                               160,744               167,152
  Unearned income                                                                                -                17,409
  Other current liabilities                                                                  9,511                42,730
                                                                                      ------------          ------------
  Total current liabilities                                                                171,201               231,616
  Long-term debt, excluding current instalments                                            407,922               402,481
  Other long-term liabilities                                                               11,803                13,645
                                                                                      ------------          ------------
  Total liabilities                                                                        590,926               647,742
                                                                                      ------------          ------------
  Shareholders' equity:
  Common stock, 5p par value: 800,000,000 shares authorized; and
  483,688,065 shares issued and outstanding (2001: 481,817,487)                             39,980                39,861
  Exchangeable shares: 5,876,415 shares issued and outstanding (2001:
  5,978,902)                                                                               272,618               277,386
  Additional paid-in capital                                                             1,025,899             1,014,796
  Accumulated other comprehensive losses                                                  (56,843)              (93,009)
  Accumulated surplus                                                                      203,649                23,955
                                                                                      ------------          ------------
  Total shareholders' equity                                                             1,485,303             1,262,989
                                                                                      ------------          ------------
  Total liabilities and shareholders' equity                                             2,076,229             1,910,731
                                                                                      ------------          ------------
  The accompanying notes are an integral part of these financial statements.
  
  </TABLE>
  
  <PAGE>
  
  
  
  <TABLE>
  <CAPTION>
  
                           SHIRE PHARMACEUTICALS GROUP PLC
                          CONSOLIDATED STATEMENTS OF INCOME
           (In thousands of U.S. dollars, except share and per share data)
                                     (Unaudited)
  
  
                                                          3 months to      3 months to           9 months          9 months
                                                        September 30,    September 30,                 to                to
                                                                 2002             2001      September 30,     September 30,
                                                                                                     2002              2001
                                                         ------------     ------------       ------------      ------------
  <S>                                                         <C>              <C>                <C>               <C>
  Product sales                                               212,041          177,275            627,674           497,366
  Licensing and development                                       726              943              2,331             4,229
  Royalties                                                    43,485           37,810            123,573           109,873
  Other revenues                                                    5              784                 10             1,530
                                                         ------------     ------------       ------------      ------------
  Total revenues                                              256,257          216,812            753,588           612,998
  
  Costs and expenses:
  Cost of revenues                                             33,337           27,037             91,022            82,081
  Research and development                                     42,026           41,327            138,557           120,838
  Selling, general and administrative (inclusive
  of stock option compensation (credit)/charge of
  ($16,000), $51,000, ($166,000) and $2,403,000
  respectively)                                                97,037           71,963            289,587           216,290
  Asset impairments and restructuring charges                       -                -                  -            85,447
  Merger transaction expenses                                       -                -                  -            83,470
  Losses on dispositions of assets                                 37            2,028                153            10,126
                                                         ------------     ------------       ------------      ------------
  Total operating expenses                                    172,437          142,355            519,319           598,252
                                                         ------------     ------------       ------------      ------------
  Operating income                                             83,820           74,457            234,269            14,746
  
  Interest income                                               5,142            4,640             14,693            14,251
  Interest expense                                            (2,280)            (989)            (6,053)           (5,671)
  Other income/(expense), net                                     904            (182)              3,734             3,497
                                                         ------------     ------------       ------------      ------------
  Total other income, net                                       3,766            3,469             12,374            12,077
                                                          -----------      -----------        -----------       -----------
  Income before income taxes                                   87,586           77,926            246,643            26,823
  
  Income taxes                                               (24,001)         (19,815)           (66,949)          (51,439)
                                                         ------------     ------------       ------------      ------------
  Net income/(loss)                                            63,585           58,111            179,694          (24,616)
                                                         ------------     ------------       ------------      ------------
  
  Net income/(loss) per common share:
  Basic                                                         12.7c            11.8c              35.9c            (5.0)c
  Diluted                                                       12.4c            11.4c              35.1c            (5.0)c
  
  Weighted average number of shares:
  Basic                                                   501,026,581      493,790,267        500,394,452       490,750,414
  Diluted                                                 524,130,078      503,914,740        524,058,558       490,750,414
  
  </TABLE>
  
  
  <PAGE>
  
  
  <TABLE>
  <CAPTION>
  
                           SHIRE PHARMACEUTICALS GROUP PLC
                        CONSOLIDATED STATEMENT OF CASH FLOWS
                           (In thousands of U.S. dollars)
                                     (Unaudited)
  9 months to September 30,                                                                           2002            2001
                                                                                           ---------------  ---------------
  Cash flows from operating activities:
  <S>                                                                                              <C>            <C>
  Net income/(loss)                                                                                179,694        (24,616)
  Adjustments to reconcile net income/(loss) to net cash provided by operating
  activities:
  Depreciation and amortization                                                                     34,860          33,753
  Stock option compensation                                                                          (166)           2,403
  Tax benefit of stock option compensation charged directly to equity                                  687           3,307
  Non cash exchange gains and losses                                                                 2,935        (15,167)
  Write-down of long-term investments                                                                5,500          24,937
  Write-down of intangible assets                                                                        -          20,890
  Write-down of net assets of business transferred under contractual arrangements
                                                                                                         -          30,811
  Loss on sale of fixed assets                                                                         153           8,112
  Loss on sale of intangible assets                                                                      -           2,014
  Changes in assets and liabilities:
  Decrease in accounts receivable                                                                   25,032           1,551
  Increase in inventory                                                                           (15,706)           (420)
  Decrease in deferred tax asset                                                                     5,462          10,137
  Increase in prepayments and other current asset investments                                      (9,546)        (13,004)
  Decrease in other assets                                                                           2,638           8,500
  (Decrease)/increase in accounts and notes payable                                               (15,374)          44,699
  Decrease in unearned income                                                                     (17,409)               -
  Decrease in other current liabilities                                                           (28,116)        (17,577)
  Decrease in other long-term liabilities                                                          (1,841)         (3,008)
                                                                                           ---------------  ---------------
  Net cash provided by operating activities                                                        168,803         117,322
                                                                                           ---------------  ---------------
  Cash flows from investing activities:
  Investment in marketable securities, net                                                               -        (18,450)
  Decrease in short-term deposits                                                                  455,114         127,911
  Purchase of long-term investments                                                                (6,921)        (13,216)
  Purchase of subsidiary undertakings                                                             (17,000)               -
  Purchase of intangible assets                                                                   (19,227)        (33,519)
  Purchase of fixed assets                                                                        (11,613)         (6,305)
  Proceeds from sale of intangible assets                                                                -           4,556
  Proceeds from sale of fixed assets                                                                     -           7,043
                                                                                           ---------------  ---------------
  Net cash provided by investing activities                                                        400,353          68,020
                                                                                           ---------------  ---------------
  Cash flows from financing activities:
  Proceeds from issue of long-term debt                                                                  -         391,000
  Payments on long-term debt and notes                                                             (2,728)       (206,990)
  Proceeds from issue of common stock, net of expenses                                                   -           1,526
  Proceeds from exercise of options                                                                  4,455          50,514
                                                                                           ---------------  --------------
  Net cash provided by financing activities                                                          1,727         236,050
                                                                                           ---------------  --------------
  Effect of foreign exchange rate changes on cash and cash equivalents                               5,692             340
                                                                                           ---------------  --------------
  Net increase in cash and cash equivalents                                                        576,575         421,732
  Cash and cash equivalents at beginning of period                                                 118,040          93,266
                                                                                           ---------------  --------------
  Cash and cash equivalents at end of period                                                       694,615         514,998
                                                                                           ---------------  --------------
  </TABLE>
  
  
  <PAGE>
  
  
  <TABLE>
  <CAPTION>
  
                CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME/(LOSS)
                           (In thousands of U.S. dollars)
                                     (Unaudited)
  
  
                                                       3 months to       3 months to       9 months to       9 months to
                                                     September 30,     September 30,     September 30,     September 30,
                                                              2002              2001              2002              2001
                                                      ------------      ------------      ------------      ------------
  <S>                                                       <C>               <C>              <C>              <C>
  Net income/(loss)                                         63,585            58,111           179,694          (24,616)
  Foreign currency translation adjustments                 (1,513)            13,424            36,166          (16,139)
  Unrealized holding losses on non-current
  investments                                                    -             (312)                 -             (508)
                                                      ------------      ------------      ------------      ------------
  Comprehensive income/(loss)                               62,072            71,223           215,860          (41,263)
                                                      ------------      ------------      ------------      ------------
  
  There are no tax effects related to the items included above.
  
  </TABLE>
  
  
  <PAGE>
  
  
                           SHIRE PHARMACEUTICALS GROUP PLC
                   NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                                     (UNAUDITED)
  
  1. Summary of Significant Accounting Policies
  
  a) Description of Operations and Principles of Consolidation
  
  Shire Pharmaceuticals Group plc (Shire), and subsidiaries (collectively, the
  Company) is an international specialty pharmaceutical company with a strategic
  focus on four therapeutic areas: central nervous system disorders, gastro
  intestinal, oncology and anti-infectives. The Company's strategy is further
  supported by three technology platforms, lead optimization for small molecules,
  drug delivery and biologics.
  
  Shire has sales and marketing subsidiaries with a portfolio of products
  targeting the U.S., Canada, the U.K., the Republic of Ireland, France, Germany,
  Italy and Spain. Shire also covers other significant pharmaceutical markets
  indirectly through distributors. The business is operated and managed within
  three individual operating segments: U.S., International and global research and
  development. Within these segments, revenues are derived primarily from three
  sources: sales of products by Shire's own sales and marketing operations,
  royalties and licensing and development fees.
  
  The Company is referred to as "specialty" because its principal products tend to
  be prescribed by specialists as opposed to primary care physicians. The
  Company's main approach is to start projects in-house through research and
  advanced drug delivery or to in-license projects, and then to develop them and
  launch them using its sales and marketing capability in the key world
  pharmaceutical markets. To complete its geographic coverage, Shire intends to
  build a presence in Japan in the mid-term. The Company seeks to protect the
  intellectual property upon which it relies through a range of patents and patent
  applications (both its own and those of its licensors).
  
  The Company's principal products include:
  
       o    in the U.S., ADDERALL XR(TM) and ADDERALL(TM) for the treatment of
            Attention Deficit Hyperactivity Disorder (ADHD); AGRYLIN(TM) for the
            treatment of elevated blood platelets; PENTASA(TM) for the treatment
            of ulcerative colitis; CARBATROL(TM) for the treatment of epilepsy;
            and PROAMATINE(TM) for the treatment of postural hypotension. In
            addition, the Company receives royalties on sales of REMINYL* for the
            treatment of Alzheimer's disease, marketed by Johnson & Johnson, and
            on EPIVIR**, COMBIVIR** and TRIZIVIR** for the treatment of HIV/AIDS
            and EPIVIR-HBV** for the treatment of hepatitis B, each marketed by
            GlaxoSmithKline (G-SK);
  
       o    in the U.K. and the Republic of Ireland, the CALCICHEW(TM)range, used
            primarily as adjuncts in the treatment of osteoporosis, and REMINYL,
            which was launched in September 2000 and is co-promoted by
            Janssen-Cilag;
  
       o    in Canada, 3TC** for the treatment of HIV/AIDS, COMBIVIR and
            HEPTOVIR** (all marketed in partnership with GlaxoSmithKline);
            AMATINE(TM); SECOND LOOK(TM), a breast cancer diagnostics product for
            which the Company received FDA approval in January 2002; and FLUVIRAL
            S/F(TM), a vaccine for the prevention of influenza; and
  
       o    in the Rest of the World, royalties on the sales of ZEFFIX** for the
            treatment of hepatitis B, marketed by GlaxoSmithKline, and royalties
            on sales of REMINYL from Janssen Pharmaceutica.
  
  In addition, the Company has a number of products in late stage development
  including FOSRENOL(TM) for the treatment of high blood phosphate levels
  associated with kidney failure and TROXATYL(TM) for the treatment of leukemia
  and pancreatic cancer. The Company submitted the first regulatory submission for
  FOSRENOL under the European Mutual Recognition procedure on March 13, 2001 and a
  New Drug Application with the U.S. FDA on April 30, 2002.
  
  The accompanying consolidated financial statements include the accounts of Shire
  Pharmaceuticals Group plc and all its subsidiary undertakings after elimination
  of intercompany accounts and transactions.
  
  *        Registered trademark of Johnson and Johnson
  **       Registered trademark of GlaxoSmithKline
  (TM)     Unless otherwise indicated, all product names set out in this document
           are trademarks of Shire or companies within the Shire Group, many of
           which are the subject of trademark registrations in certain
           territories.
  
  
  <PAGE>
  
  b) Basis of Presentation
  
  These interim financial statements, which include the operations of the Company
  and its wholly owned subsidiaries and the financial information included herein,
  are unaudited. They have been prepared in accordance with generally accepted
  accounting principles in the United States and Securities and Exchange
  Commission regulations for interim reporting. Certain information and footnote
  disclosures normally included in financial statements prepared in accordance
  with generally accepted accounting principles in the United States have been
  condensed or omitted pursuant to such rules and regulations. However, such
  information includes all adjustments (consisting solely of normal recurring
  adjustments), which are, in the opinion of management, necessary to fairly state
  the results of the interim periods. Interim results are not necessarily
  indicative of results to be expected for the full year.
  
  The December 31, 2001 balance sheet was derived from audited financial
  statements but does not include all disclosures required by US GAAP. However,
  the Company believes that the disclosures are adequate to make the information
  presented not misleading.
  
  These interim financial statements should be read in conjunction with the
  Company's consolidated balance sheets as of December 31, 2001 and 2000, and the
  related consolidated statements of operations, cash flows and changes in
  stockholders' equity for each of the three years in the period ended December
  31, 2001.
  
  c) New Accounting Pronouncements
  
  In June 2001, the FASB issued SFAS No. 143, Accounting for Asset Retirement
  Obligations. SFAS No. 143 requires that the fair value of a liability for asset
  retirement obligations be recognized in the period in which it is incurred if a
  reasonable estimate of the fair value can be made. The associated asset
  retirement costs are capitalized as part of the carrying amount of the related
  long-lived asset. SFAS No. 143 is effective for financial statements issued for
  fiscal years beginning after June 15, 2002. The Company has assessed the
  potential impact of the adoption of SFAS No. 143 and concluded that there is no
  impact.
  
  In August 2001, the FASB issued SFAS No. 144, Accounting for the Impairment or
  Disposal of Long-Lived Assets, which addresses financial accounting and
  reporting for the impairment or disposal of long-lived assets and supersedes
  SFAS No. 121, Accounting for the Impairment of Long-Lived Assets and for
  Long-Lived Assets to be Disposed Of, and the accounting and reporting provisions
  of APB Opinion No. 30, Reporting the Results of Operations, for a disposal of a
  segment of a business. SFAS No. 144 is effective for fiscal years beginning
  after December 15, 2001. The adoption of SFAS No. 144 has had no significant
  impact on our financial position and results of operations.
  
  In April 2002, the FASB issued SFAS No. 145, Rescission of FASB Statements No.4,
  44 and 64, Amendment of FASB Statement No.13 and Technical Corrections. The
  principal change is that gains or losses from extinguishment of debt which are
  classified as extraordinary items by SFAS No. 4 will no longer be classified as
  such. The provisions of SFAS No. 145 are effective for fiscal years beginning
  after May 15, 2002 although early application of the Statement related to the
  rescission of SFAS No. 4 is encouraged. The Company plans to adopt SFAS 145 for
  its fiscal year ending December 31, 2003. When adopted, prior extraordinary
  items related to the extinguishment of debt will need to be reclassified.
  
  In June 2002, the FASB issued SFAS No. 146, Accounting for Costs Associated with
  Exit or Disposal Activities, which addresses accounting and processing for costs
  associated with exit or disposal activities and nullifies Emerging Issues Task
  Force (EITF) Issue 94-3, Liability Recognition for Certain Employee Termination
  Benefits and Other Costs to Exit and Activity (including Certain Costs Incurred
  in a Restructuring). SFAS No. 146 requires that a liability for a cost
  associated with an exit or disposal liability be recognized when the liability
  is incurred. Under Issue 94-3, a liability for an exit cost was recognized at
  the date of an entity's commitment to an exit plan. Under SFAS No. 146, fair
  value is the objective for initial measurement of the liability. SFAS No. 146 is
  effective for exit or disposal activities that are initiated after December 31,
  2002, with early application encouraged. We do no expect the adoption of SFAS
  No. 146 to have a material impact on our financial position, results of
  operations or cash flows.
  
  <PAGE>
  
  2. Inventory
  
                                    September 30,            December 31,
                                             2002                    2001
                                            $'000                   $'000
                                   --------------          --------------
  Finished goods                           31,273                  19,880
  Work-in-process                          21,551                  18,262
  Raw materials                             8,661                   8,548
                                   --------------          --------------
                                           61,485                  46,690
                                   --------------          --------------
  
  
  
  <PAGE>
  
  
  
  3. Analysis of revenue, operating income and reportable segments
  
  The Company has disclosed segment information for the individual operating areas
  of the business based on the way in which the business is managed and
  controlled. Shire's principal reporting segments are U.S., International and
  Global Research and Development, each being managed and monitored separately.
  The Company evaluates performance based on operating income.
  
  <TABLE>
  <CAPTION>
  
  Three months ended September 30, 2002                           U.S.   International              R&D           Total
                                                                 $'000           $'000            $'000           $'000
                                                            ----------      ----------       ----------      ----------
  <S>                                                          <C>              <C>                   <C>       <C>
  Product sales                                                173,532          38,509                -         212,041
  Licensing and development                                        726               -                -             726
  Royalties                                                          -          43,485                -          43,485
  Other revenues                                                     -               5                -               5
                                                            ----------      ----------       ----------      ----------
  Total revenues                                               174,258          81,999                -         256,257
                                                            ----------      ----------       ----------      ----------
  
  Cost of revenues                                              13,103          20,234                -          33,337
  Research and development                                           -               -           42,026          42,026
  Selling, general and administrative                           47,353          37,136                -          84,489
  Depreciation and amortization                                  7,548           5,000                -          12,548
  Loss on dispositions of assets                                    37               -                -              37
                                                            ----------      ----------       ----------      ----------
  Total operating expenses                                      68,041          62,370           42,026         172,437
                                                            ----------      ----------       ----------      ----------
  Operating income/(loss)                                      106,217          19,629         (42,026)          83,820
                                                            ----------      ----------       ----------      ----------
  
  Three months ended September 30, 2001                           U.S.   International              R&D           Total
                                                                 $'000           $'000            $'000           $'000
                                                            ----------      ----------       ----------      ----------
  Product sales                                                149,853          27,422                -         177,275
  Licensing and development                                        943               -                -             943
  Royalties                                                         44          37,766                -          37,810
  Other revenues                                                     -             784                -             784
                                                            ----------      ----------       ----------      ----------
  Total revenues                                               150,840          65,972                -         216,812
                                                            ----------      ----------       ----------      ----------
  
  Cost of revenues                                              13,264          13,773                -          27,037
  Research and development                                           -               -           41,327          41,327
  Selling, general and administrative                           34,968          25,269                -          60,237
  Depreciation and amortization                                  3,000           8,726                -          11,726
  Losses on dispositions of assets                               2,014              14                -           2,028
                                                            ----------      ----------       ----------      ----------
  Total operating expenses                                      53,246          47,782           41,327         142,355
                                                            ----------      ----------       ----------      ----------
  Operating income/(loss)                                       97,594          18,190         (41,327)          74,457
                                                            ----------      ----------       ----------      ----------
  
  Intra-segment group income earned and eliminated from the above table was $23.2
  for the three months ended September 30, 2002 (2001: $12.0 million). The R&D
  segment received revenue of $17.9 million from the US segment (2001: $9.3
  million), and the US segment received revenue of $5.3 million from the
  International segment (2001: $2.7 million).
  
  </TABLE>
  
  <PAGE>
  
  
  
  <TABLE>
  <CAPTION>
  
  Nine months ended September 30, 2002                           U.S.     International              R&D             Total
                                                                $'000             $'000            $'000             $'000
                                                           ----------        ----------       ----------        ----------
  <S>                                                         <C>               <C>                    <C>         <C>
  Product sales                                               527,005           100,669                -           627,674
  Licensing and development                                     1,929               402                -             2,331
  Royalties                                                       221           123,352                -           123,573
  Other revenues                                                    -                10                -                10
                                                           ----------        ----------       ----------        ----------
  Total revenues                                              529,155           224,433                -           753,588
                                                           ----------        ----------       ----------        ----------
  
  Cost of revenues                                             46,044            44,978                -            91,022
  Research and development                                          -                 -          138,557           138,557
  Selling, general and administrative                         161,096            93,631                -           254,727
  Depreciation and amortization                                21,027            13,833                -            34,860
  Loss on dispositions of assets                                  153                 -                -               153
                                                           ----------        ----------       ----------        ----------
  Total operating expenses                                    228,320           152,442          138,557           519,319
                                                           ----------        ----------       ----------        ----------
  Operating income/(loss)                                     300,835            71,991        (138,557)           234,269
                                                           ----------        ----------       ----------        ----------
  
  Nine months ended September 30, 2001                           U.S.     International              R&D             Total
                                                                $'000             $'000            $'000             $'000
                                                           ----------        ----------       ----------        ----------
  Product sales                                               418,305            79,061                -           497,366
  Licensing and development                                     3,272               957                -             4,229
  Royalties                                                       224           109,649                -           109,873
  Other revenues                                                    -             1,530                -             1,530
                                                           ----------        ----------       ----------        ----------
  Total revenues                                              421,801           191,197                -           612,998
                                                           ----------        ----------       ----------        ----------
  
  Cost of revenues                                             48,756            33,325                -            82,081
  Research and development                                          -                 -          120,838           120,838
  Selling, general and administrative                         116,951            65,586                -           182,537
  Depreciation and amortization                                12,870            20,883                -            33,753
  Asset impairments and restructuring charges
                                                                    -            85,447                -            85,447
  Merger transaction expenses                                       -            83,470                -            83,470
  Losses on dispositions of assets                              2,014             8,112                -            10,126
                                                           ----------        ----------       ----------        ----------
  Total operating expenses                                    180,591           296,823          120,838           598,252
                                                           ----------        ----------       ----------        ----------
  Operating income/(loss)                                     241,210         (105,626)        (120,838)            14,746
                                                           ----------        ----------       ----------        ----------
  </TABLE>
  
  Intra-segment group income earned and eliminated from the above table was $49.5
  million for the nine months ended September 30, 2002 (2001: $41.7 million). The
  R&D segment received revenue of $36.2 million from the US segment (2001: $29.3
  million), and the US segment received revenue of $13.3 million from the
  International segment (2001: $12.4 million).
  
  
  
  <PAGE>
  
  
  
  4. Net income/(loss) per share
  
  Basic net income/(loss) per share is based upon the net income/(loss) available
  to common stockholders divided by the weighted-average number of common shares
  outstanding during the period. Diluted net income/(loss) per share is based upon
  net income/(loss) available to common stockholders divided by the
  weighted-average number of common shares outstanding during the period and
  adjusted for the effect of all dilutive potential common shares that were
  outstanding during the period.
  
  The following table sets forth the computation of basic and diluted net
  income/(loss) per share:
  
  <TABLE>
  <CAPTION>
  
                                                             3 months to       3 months to      9 months to      9 months to
                                                           September 30,     September 30,    September 30,    September 30,
                                                                    2002              2001             2002             2001
                                                                   $'000             $'000            $'000            $'000
                                                        ----------------  ----------------  ---------------- ----------------
  <S>                                                             <C>               <C>             <C>             <C>
  Numerator for basic net income/(loss) per share                 63,585            58,111          179,694         (24,616)
  Interest charged on convertible debt, net of tax                 1,380                22            4,188                -
                                                        ----------------  ----------------  ---------------- ----------------
  Numerator for diluted net income/(loss) per share               64,965            58,133          183,882         (24,616)
                                                        ----------------  ----------------  ---------------- ----------------
  
  
  Weighted average number of shares:                       No. of shares     No. of shares    No. of shares    No. of shares
                                                        ----------------  ----------------  ---------------- ----------------
  Basic  - weighted average number of shares
                                                             501,026,581       493,790,267      500,394,452      490,750,414
  Effect of dilutive stock options                             1,993,136         9,543,434        2,553,745                -
  Warrants                                                     1,263,184           298,595        1,263,184                -
  Convertible debt                                            19,847,177           282,444       19,847,177                -
                                                        ----------------  ----------------  ---------------- ----------------
  Diluted - weighted average number of shares                524,130,078       503,914,740      524,058,558      490,750,414
                                                        ----------------  ----------------  ---------------- ----------------
  Basic net income/(loss) per share                                12.7c             11.8c            35.9c           (5.0c)
                                                        ----------------  ----------------  ---------------- ----------------
  Diluted net income/(loss) per share                              12.4c             11.4c            35.1c           (5.0c)
                                                        ----------------  ----------------  ---------------- ----------------
  
  </TABLE>
  
  The calculation of weighted average number of shares for the nine months ended
  September 30, 2001 does not include share options, warrants or convertible debt
  because their inclusion in a loss making period would be anti-dilutive.
  
  5. Goodwill and Other Intangible Assets - Adoption of Statement 142
  
  SFAS No. 142 is effective for fiscal years beginning after December 15, 2001.
  The statement directs that goodwill and intangible assets that have indefinite
  useful lives will not be amortized but rather will be tested at least annually
  for impairment. Intangible assets that have finite useful lives will continue to
  be amortized over their useful lives, but without the constraint of an arbitrary
  ceiling.
  
  a) Goodwill
  
  A reconciliation table for the results for the three and nine months ended
  September 30, 2001 is provided to exclude the effect of goodwill amortization in
  accordance with transitional disclosures relating to SFAS 142. Results for the
  three and nine months ended September 30, 2002 have been prepared in accordance
  with SFAS 142.
  
  
  <PAGE>
  
  A transitional assessment of goodwill impairment as of January 1, 2002 has been
  completed. The Company has concluded that the fair value of its individual
  reporting units exceeds the carrying value of the net assets including goodwill,
  and hence no adjusting entry is necessary.
  
  <TABLE>
  <CAPTION>
  
                                                             3 months to       3 months to      9 months to      9 months to
                                                           September 30,     September 30,    September 30,    September 30,
                                                                    2002              2001             2002             2001
                                                                   $'000             $'000            $'000            $'000
                                                        ----------------  ----------------  ---------------- ----------------
  <S>                                                             <C>               <C>             <C>             <C>
  Reported net income/(loss)                                      63,585            58,111          179,694         (24,616)
  Add back: Goodwill amortization                                      -             2,704                -            8,054
                                                        ----------------  ----------------  ---------------- ----------------
  Adjusted net income/(loss)                                      63,585            60,815          179,694         (16,562)
  Interest charged on convertible debt, net of tax                 1,380                22            4,188                -
                                                        ----------------  ----------------  ---------------- ----------------
  Numerator for diluted net income/(loss) per share               64,965            60,837          183,882         (16,562)
                                                        ----------------  ----------------  ---------------- ----------------
  
  Weighted average number of shares:                       No. of shares     No. of shares    No. of shares    No. of shares
                                                        ----------------  ----------------  ---------------- ----------------
  Basic                                                      501,026,581       493,790,267      500,394,452      490,750,414
  Diluted                                                    524,130,078       503,914,740      524,058,558      490,750,414
  
  Basic earnings per share:
  Reported net income/(loss)                                       12.7c             11.8c            35.9c           (5.0c)
  Goodwill amortization (net of tax effect)                            -              0.5c                -             1.6c
                                                        ----------------  ----------------  ---------------- ----------------
  Adjusted net income/(loss)                                       12.7c             12.3c            35.9c           (3.4c)
                                                        ----------------  ----------------  ---------------- ----------------
  Diluted earnings per share:
  Reported net income/(loss)                                       12.4c             11.4c            35.1c           (5.0c)
  Goodwill amortization (net of tax effect)                            -              0.7c                -             1.6c
                                                        ----------------  ----------------  ---------------- ----------------
  Adjusted net income/(loss)                                       12.4c             12.1c            35.1c           (3.4c)
                                                        ----------------  ----------------  ---------------- ----------------
  
  </TABLE>
  
  The calculation of the diluted weighted average number of shares for the nine
  months ended September 30, 2001 excludes the effects of share options, warrants
  and convertible debt because their inclusion in a loss making period would be
  anti-dilutive.
  
  There is no tax effect related to the inclusion of goodwill amortization in the
  earnings calculation disclosed above.
  
  b) Intangible fixed assets
  
                                             September 30,       September 30,
                                                      2002                2001
                                                     $'000               $'000
                                              ------------        ------------
  Intellectual property rights acquired            484,947             469,745
  Less: Accumulated amortization                 (109,164)            (88,148)
                                              ------------        ------------
                                                   375,783             381,597
                                              ------------        ------------
  
  The useful economic lives of all intangible assets have been reassessed in
  accordance with SFAS No. 142.
  
  
  <PAGE>
  
  Management estimates that the annual amortization charge in respect of
  intangible fixed assets held at September 30, 2002 will be approximately $35
  million for each of the five years to September 30, 2007. Estimated amortization
  expense can be affected by various factors including future acquisitions and
  disposals of product rights.
  
  6. Consolidated statement of changes in shareholders' equity
  
  <TABLE>
  <CAPTION>
  
                                                                                                Accumu-
                                                             Exchan-                             lated
                                     Common      Exchan-     geable                              other       Total
                         Common      Stock       geable      shares    Additional    Accumu-    compre-    sharehold-
                         Stock         No.       shares        No.      paid-in      lated      hensive       ers'
                         Amount      Shares      Amount      shares     capital      surplus    losses      equity
                         $'000        000's      $'000        000's      $'000        $'000      $'000      $'000
                       ----------- ----------- ----------------------------------------------------------------------
  <S>                      <C>        <C>         <C>          <C>       <C>           <C>      <C>          <C>
  As at January 1,
  2002                     39,861     481,817     277,386      5,979     1,014,796     23,955   (93,009)     1,262,989
  Net income                    -           -           -          -             -    179,694          -       179,694
  Foreign currency
  translation                   -           -           -          -             -          -     36,166        36,166
  Exchange of
  exchangeable shares           -         308     (4,768)      (103)         4,768          -          -             -
  Conversion of loan
  note                         22         268           -          -         1,456          -          -         1,478
  Options exercised            97       1,295           -          -         4,358          -          -         4,455
  Stock option
  compensation                  -           -           -          -         (166)          -          -         (166)
  Tax benefit
  associated with
  exercise of stock
  options                       -           -           -          -           687          -          -           687
                       ----------- ----------- -----------------------------------------------------------------------
  As at September
  30, 2002                 39,980     483,688     272,618      5,876     1,025,899    203,649   (56,843)     1,485,303
                       ----------- ----------- ----------------------------------------------------------------------
  
  </TABLE>
  
  Each exchangeable share is exchangeable into 3 common shares or one ADS.
  
  7. Contingent liabilities
  
  (i) Commitments
  
  The Company has undertaken to subscribe to interests in companies and
  partnerships for amounts totalling $37.9 million (December 31, 2001: $37.7
  million). As at September 30, 2002 an amount of $26.3 million (December 31,
  2001: $20.1 million) has been subscribed.
  
  (ii) FLUVIRAL
  
  The Company has signed a ten-year contract with the Government of Canada to
  assure a state of readiness in the case of an influenza pandemic (worldwide
  epidemic) and to provide influenza vaccine for all Canadian citizens in such an
  event. Under the contract, Shire Biologics will also supply the Government of
  Canada with a substantial proportion of its annual influenza vaccine
  requirements over the ten-year period. Subject to mutual agreement, the contract
  can be renewed for a further period of between one and ten years from 2011.
  
  
  <PAGE>
  
  The concept of a state of readiness against an influenza pandemic requires the
  development of sufficient infrastructure and capacity in Canada to provide 100%
  of domestic vaccine needs in the event of an influenza pandemic. Canada would
  require 32 million doses of single-strain (monovalent) flu vaccine within a
  production period of 16 weeks. Shire Biologics will therefore begin expanding
  its current production capacity in order to meet this objective within a
  five-year period.
  
  Shire Biologics is committed to Cdn$4.5 million (approximately $3.0 million) of
  capital expenditure on immoveables for the purpose of achieving the level of
  pandemic readiness required. In addition, a performance bond equal to Cdn$17.5
  million (approximately $11.5 million) has been established to ensure that in the
  event of default by Shire Biologics, adequate funds will be available to
  complete the work according to the terms of the contract.
  
  (iii) Other matters
  
  In addition, the Company is involved in claims and lawsuits in the normal course
  of business. It is not possible at this time to determine the ultimate outcome
  of any of these claims.
  
  
  <PAGE>
  
  
  ITEM 2. Management's Discussion and Analysis of Financial Condition and Results
          of Operations
  
  Results of operations for the three months ended September 30, 2002, as compared
  with those for the three months ended September 30, 2001
  
  Overview of financial results
  
  Total revenues for the three months ended September 30, 2002 increased by 18 per
  cent to $256.3 million as compared to the three months ended September 30, 2001.
  The Company recorded a third quarter net income of $63.6 million (2001: $58.1
  million).
  
  Sales and marketing
  
  Product sales of $212.0 million, which represented 83 per cent of total revenues
  for the third quarter 2002, increased by 20 per cent over third quarter 2001
  product sales of $177.3 million. Product sales in the U.S. continue to represent
  a significant percentage of our worldwide product sales, 82 per cent in the
  three months ended September 30, 2002 (2001: 85 per cent).
  
  The Company manages and controls the sales and marketing operations on
  geographic lines. The following table presents the Company's net product sales
  by individual operating segment:
  
  <TABLE>
  <CAPTION>
  
  Product sales by segment                3 months to               3 months to
                                   September 30, 2002        September 30, 2001
                                                $'000                     $'000         % change
  
  <S>                                         <C>                       <C>                   <C>
  United States                               173,532                   149,853              +16
  International                                38,509                    27,422              +40
                                         ------------              ------------     ------------
  Total product sales                         212,041                   177,275              +20
                                         ------------              ------------     ------------
  
  </TABLE>
  
  
  Third quarter combined sales of ADDERALL XR and ADDERALL, marketed in the U.S.
  for the treatment of Attention Deficit Hyperactivity Disorder (ADHD), were $96.1
  million, representing an increase of 11% in ADDERALL franchise sales over the
  comparative period in 2001. ADDERALL XR and ADDERALL had a 27 per cent share of
  a strongly growing prescription market for ADHD in the U.S. in September 2002
  compared to a 32 per cent in September 2001. The prescription market was 17 per
  cent larger in Q3 2002 compared to the equivalent period in 2001.
  
  ADDERALL XR recorded sales of $78.0 million in Q3 2002 and had a prescription
  market share of 21 per cent in September 2002, up from 17 per cent in June 2002
  (ADDERALL XR was not yet launched in Q3 2001). Sales for the quarter included $2
  million in respect of the launch and wholesaler stocking of a new 5mg dose. As
  anticipated, sales of ADDERALL XR reflect both the growth in scrip market share
  but also increases in wholesaler and retail pipeline levels to support the
  growing business. This impact was estimated to be minor in Q3 2002.
  
  In September 2002, ADDERALL had a market share of 6 per cent (September 2001: 32
  per cent). The decrease in ADDERALL sales during the third quarter reflects
  Shire's continued success in switching patients from ADDERALL to the once a day
  treatment (ADDERALL XR), the impact of generic competition throughout the
  quarter and further de-stocking of ADDERALL by wholesalers.
  
  Sales of AGRYLIN, for the treatment of thrombocythaemia, were $28.7 million, a
  45 per cent increase on Q3 2001 sales of $19.8 million. Sales growth in markets
  outside the U.S. grew from $3.9 million to $7.5 million. In the US, market sales
  growth of 34 per cent exceeded the scrip growth of 23 per cent during the
  quarter, due to a price increase in January 2002, and a lower Q3 2001
  comparative quarter caused by some wholesaler de-stocking following an earlier
  price increase. Shire achieved 27 per cent of the total US AGRYLIN, Hydrea and
  generic hydroxyurea prescription market in September 2002, compared to 24 per
  cent for the month of September 2001.
  
  Sales of PENTASA, licensed for the treatment of ulcerative colitis, were $21.6
  million for the third quarter 2002, 8 per cent higher than the comparable period
  last year. Sales growth was marginally above
  
  
  <PAGE>
  
  prescription growth due to a price increase earlier in the year. PENTASA had an
  18 per cent share of the oral mesalamine/obsalazine market in September 2002,
  consistent with September 2001.
  
  Sales of PROAMATINE, for the treatment of postural hypotension, were $14.4
  million, 62 per cent higher than third quarter 2001 sales of $8.9 million. Sales
  growth significantly exceeded scrip growth of 16 per cent due to price increases
  in January and May 2002, the launch and subsequent stocking of a new 10mg
  strength during the quarter, and a low sales base in the third quarter 2001,
  which resulted from wholesaler de-stocking. The U.S. prescription market for
  PROAMATINE and FLORINEF(TM) prescriptions indicates that PROAMATINE had a 25 per
  cent share in September 2002, consistent with September 2001.
  
  Sales of CARBATROL, containing carbamazepine for the treatment of epilepsy, were
  $10.9 million, 38 per cent higher than Q3 2001 sales of $7.9 million. Sales
  growth was 33 per cent above scrip growth due to partial re-stocking of
  wholesaler pipelines following an easing of supply constraints which have
  limited the underlying scrip growth. CARBATROL held 36 per cent of the US
  extended release carbamazepine prescription market in September 2002, compared
  to 35 per cent in September 2001.
  
  
  Licensing
  
  Licensing and development fees in respect of Shire Laboratories Inc (SLI) drug
  delivery contracts were $0.7 million, a decrease of $0.2 million compared to the
  three months ended September 30, 2001, resulting from the phasing of receipts
  from third parties.
  
  
  Royalties
  
  Royalties increased by $5.7 million in the three months ended September 30,
  2002, up 15 per cent from the three months ended September 30, 2001, to $43.5
  million.
  
  The Company receives royalties from GlaxoSmithKline on the worldwide sales of
  3TC (for the treatment of HIV infection / AIDS), and ZEFFIX (an oral treatment
  for chronic hepatitis B), with the exception of Canada where a commercialization
  partnership with GSK exists.
  
  In December 2001, Shire and GSK agreed a legal settlement with Emory University
  relating to worldwide patent disputes. Under the terms of this settlement Shire
  pays a royalty on sales of 3TC and ZEFFIX to Emory University. The 3TC and
  ZEFFIX royalties are impacted by this in the third quarter 2002 but not in the
  comparative quarter of 2001.
  
  3TC royalties for the three months ended September 30, 2002 were $32.5 million,
  an increase of 3% over the three months ended September 30, 2001. The underlying
  sales growth rate, expressed at constant exchange rates was 6%. The variance in
  royalty growth versus sales growth is due to the Emory settlement and currency
  movements.
  
  ZEFFIX royalties were $5.5 million in the third quarter 2002, an increase of 17%
  over third quarter 2001. The underlying sales growth rate expressed at constant
  exchange rates was 19%. The variance in royalty growth versus sales growth is
  due to the Emory settlement and currency movements.
  
  The Company also receives royalties from J&J on sales of REMINYL, for the
  treatment of Alzheimer's Disease.
  
  Cost of revenues
  
  Gross margin on product sales decreased slightly from 85 per cent for the three
  months ended September 30, 2001 to 84 per cent for the three months ended
  September 30, 2002, due to a slight change in sales mix.
  
  
  
  <PAGE>
  
  Research and development
  
  R&D expenditure increased 2 per cent to $42.0 million for the three months ended
  September 30, 2002 (2001: $41.3 million). R&D expenditure in third quarter 2002
  represented 16 per cent of revenues compared to 19 per cent in third quarter
  2001. The low relative spend in the quarter is related to phasing of various
  projects, including the completion of certain trials for FOSRENOL, and the
  discontinuation of Dirame.
  
  Selling, general and administrative expenses
  
  Selling, general and administrative expenses, excluding the effects of a stock
  option compensation credit of $0.01 million (2001: charge $0.05 million) and
  depreciation and amortization of $12.5 million (2001: $11.7 million), increased
  by 40 per cent to $84.5 million for the three months ended September 30, 2002
  (2001: $60.2 million). This increase reflects mainly the sustained high level of
  promotional spend associated with the ADDERALL XR launch. As a percentage of
  product sales, selling, general and administrative costs represented 40 per cent
  for the third quarter 2002 (2001: 34 per cent).
  
  Interest income and expense
  
  For the three months ended September 30, 2002, the Company received interest
  income of $5.1 million (Q3 2001: $4.6 million). Interest expense increased from
  $1.0 million to $2.3 million; primarily because the Q3 2002 expense reflects a
  full quarter of interest incurred in respect of the $400 million convertible
  notes issued in August 2001.
  
  Other income (net)
  
  Other income (net) was $0.9 million compared to a $0.2 million expense in the
  third quarter of 2001. The prior year quarter was impacted by a $1.8 million
  mark to market loss on a fully funded Supplemental Executive Retirement Plan
  (SERP), reflecting changes in US stock market conditions.
  
  Income taxes
  
  For the three months ended September 30, 2002 income taxes increased $4.2
  million to $24.0 million from $19.8 million for the three months ended September
  30, 2001. The Company's effective tax rate before the stock compensation charge
  was 27 per cent for the three months ended September 30, 2002 (Q3 2001: 25 per
  cent before stock compensation charge and exceptional items). The Company has
  recorded net deferred tax assets of $26.8 million (September 30, 2001: $23.4
  million). Realization is dependent upon generating sufficient taxable income to
  utilize such assets. Although realization on these assets is not assured,
  management believes it is more likely than not that the deferred tax assets will
  be realized.
  
  Results of operations for the nine months ended September 30, 2002, as compared
  with those for the nine months ended September 30, 2001
  
  Overview of financial results
  
  Total revenues for the nine months ended September 30, 2002 increased by 23 per
  cent to $753.6 million as compared to the nine months ended September 30, 2001.
  The Company recorded a year-to-date net income of $179.7 million (2001: net loss
  of $24.6 million after one time merger related expenses and restructuring
  charges of $177.0 million).
  
  Sales and marketing
  
  Product sales for the nine months ended September 30, 2002 of $627.7 million,
  which represented 83 per cent of total revenues, increased by 26 per cent over
  the nine months ended September 30, 2001 product sales of $497.4 million.
  Product sales in the U.S. continue to represent a significant percentage of our
  worldwide product sales, 84 per cent in the nine months ended September 30, 2002
  (2001: 84 per cent).
  
  
  <PAGE>
  
  
  
  The Company manages and controls the sales and marketing operations on
  geographic lines. The following table presents the Company's net product sales
  by individual operating segment:
  
  Product sales by segment          9 months to        9 months to
                                  September 30,      September 30,
                                           2002               2001
                                          $'000              $'000        % change
  
  United States                         527,005            418,305             +26
  International                         100,669             79,061             +27
                                   ------------       ------------    ------------
  Total product sales                   627,674            497,366             +26
                                   ------------       ------------    ------------
  
  Cost of revenues
  
  Gross margin on product sales increased from 83 per cent for the nine months
  ended September 30, 2001 to 85 per cent for the nine months ended September 30,
  2002. The main reason for this is that higher margin products represented a
  higher proportion of total sales.
  
  Research and development
  
  Research and development expenditure increased 15 per cent to $138.6 million for
  the nine months ended September 30, 2002 (2001: $120.8 million). R&D expenditure
  in the nine months ended September 30, 2002 represented 18 per cent of revenues
  compared to 20 per cent for the nine months ended September 30, 2001.
  
  Selling, general and administrative expenses
  
  Selling, general and administrative expenses, excluding the effects of a stock
  option compensation credit of $0.2 million (2001: charge $2.4 million) and
  depreciation and amortization of $34.9 million (2001: $33.8 million), increased
  by 40 per cent to $254.7 million for the nine months ended September 30, 2002
  (2001: $180.1 million). This primarily reflects the high promotional spend
  associated with the ADDERALL XR launch. As a percentage of product sales,
  selling, general and administrative costs represented 41 per cent for the nine
  months ended September 30, 2002 (2001: 36%).
  
  Interest income and expense
  
  For the nine months ended September 30, 2002, the Company received interest
  income of $14.7 million (2001: $14.3 million). Interest expense increased from
  $5.7 million to $6.1 million. This increase reflects a full year-to-date charge
  of interest in respect of the $400 million convertible notes issued in August
  2001, which bear interest at a fixed rate of 2% per annum. Conversion to equity
  of the $1.5 million Arenol loan note was effected in July 2002.
  
  Income taxes
  
  For the nine months ended September 30, 2002 income taxes increased $15.5
  million to $66.9 million from $51.4 million for the nine months ended September
  30, 2001. The Company's effective tax rate before the stock compensation credit
  was 27 per cent for the nine months ended September 30, 2002 (2001: 25 per
  cent). The Company has recorded net deferred tax assets of $26.8 million.
  Realization is dependent upon generating sufficient taxable income to utilize
  such assets. Although realization on these assets is not assured, management
  believes it is more likely than not that the deferred tax assets will be
  realized.
  
  
  <PAGE>
  
  
  
  Liquidity and Financial Condition
  
  The Company's funding requirements depend on a number of factors, including the
  Company's product development programs, business and product acquisitions, the
  level of resources required for the expansion of marketing capabilities as the
  product base expands, increased investment in accounts receivable and inventory
  which may arise as sales levels increase, competitive and technological
  developments, the timing and cost of obtaining required regulatory approvals for
  new products and the continuing revenues generated from sales of its key
  products.
  
  At September 30, 2002, the Company had net cash funds available as follows:
  
                                                September 30,         December 31,
                                                         2002                 2001
                                                        $'000                $'000
                                               --------------       --------------
  Cash and cash equivalents                           694,615              118,040
  Marketable securities and other current
    asset investments                                 268,665              723,911
  Debt                                              (408,868)            (406,806)
                                               --------------       --------------
  Net cash                                            554,412              435,145
                                               --------------       --------------
  
  Net cash provided by operating activities for the nine months ended September
  30, 2002 was $168.8 million compared to $117.3 million for the nine months ended
  September 30, 2001.
  
  Investing activities provided $400.4 million for the nine months ended September
  30, 2002 (2001: $68.0 million). This was due to an inflow of $455.1 million of
  cash by reducing funds placed on short-term deposit, and outflows in respect of
  capital expenditure on long-term investments, intangible assets and fixed assets
  of $54.8 million.
  
  Investing activities for the nine months ended September 30, 2001 included
  $109.5 million from the investment in marketable securities and reduction of
  cash placed on short-term deposit, a $53.0 million outflow in respect of capital
  expenditure on long-term investments, intangible assets and fixed assets and
  proceeds from sales of intangible fixed assets of $11.6 million.
  
  Financing activities provided $1.7 million for the nine months ended September
  30, 2002 (2001: $236.1 million). The net inflow included $4.4 million received
  from exercises of employee stock options and $2.7 million in repayments of
  long-term debt.
  
  Financing activities for the nine months ended September 30, 2001 included a
  $50.5 million inflow from exercises of employee stock options and $391.0 million
  received from the issue of convertible notes, and repayments of long-term debt
  totalling $207.0 million. The repayments were primarily in respect of a $125.0
  million term loan owing to Credit Suisse First Boston and $76.9 million repaid
  to Glaxo SmithKline. In part, cash funds released from short-term investments,
  as noted above, were used to settle the long-term debts outstanding.
  
  Capital expenditure
  
  Capital expenditure on tangible fixed assets for the nine months ended September
  30, 2002 was $11.6 million, which primarily comprised laboratory and computer
  equipment purchased across the Group.
  
  Other capital expenditure related to the purchase of long-term investments ($6.9
  million) and intangible assets ($19.2 million). The expenditure on intangible
  assets was in respect of SOLARAZE(TM), a product purchased from Skye Pharma plc
  and Bioglan Pharma plc (in administration) in May 2002 for the treatment of a
  skin condition related to excessive exposure to the sun, actinic keratosis.
  
  The Company acquired U.S. manufacturer Atlantic Pharmaceutical Services Inc for
  $17.0 million in September 2002, to provide in house manufacturing capabilities
  to support current and future activities, including the production of ADDERALL
  XR, CARBATROL and PENTASA.
  
  
  <PAGE>
  
  Capital expenditure on tangible fixed assets for the nine months ended September
  30, 2001 was $6.3 million, which included $1.7 million of equipment related to
  the Company's new head office facility occupied from March 2001. Expenditure was
  offset by $7.0 million in proceeds received on the disposal of the Toronto
  facility. Other capital expenditure related to the purchase of long-term
  investments ($13.2 million) and $33.5 million for new products, including
  MONOCID(TM) and INDURGAN(TM) marketed by the Company's Italian and Spanish
  operations respectively.
  
  
  ITEM 3.  Qualitative and Quantitative Disclosures about Market Risk
  
  Item 7A of the Group's Annual Report on Form 10-K for the year ended December
  31, 2001 contains a detailed discussion of the Group's market risk exposure in
  relation to interest rate market risk and foreign exchange market risk. There
  have been no material changes in the Group's market risk exposure since December
  31, 2001.
  
  
  ITEM 4. Controls and Procedures
  
  Within the 90-day period prior to the filing of this report, an evaluation was
  carried out under the supervision and with the participation of Shires'
  management, including our Chief Executive Officer and Chief Financial Officer,
  of the effectiveness of our disclosure controls and procedures (as defined in
  Rule 13a-14(c) under the Securities Exchange Act of 1934). Based upon that
  evaluation, the Chief Executive Officer and Chief Financial Officer concluded
  that these disclosure controls and procedures were effective. No significant
  changes were made in our internal controls or in other factors that could
  significantly affect these controls subsequent to the date of their evaluation.
  
  
  PART II.   OTHER INFORMATION
  
  ITEM 1. LEGAL PROCEEDINGS
  
  (i) General
  
  The risk of product liability claims, product recalls, litigation and associated
  adverse publicity is inherent in the testing, manufacturing, marketing and
  selling of pharmaceutical products. The cost of defending against such claims is
  expensive even when the claims are not merited. A successful product liability
  claim against us could require us to pay a substantial monetary reward. If, in
  the absence of insurance, we do not have sufficient financial resources to
  satisfy a liability resulting from such a claim or to fund the legal defence of
  such a claim, we could become insolvent. Product liability insurance coverage is
  expensive, difficult to obtain and may not be available in the future on
  acceptable terms. Although we carry product liability insurance, this coverage
  may not be adequate. In addition, we cannot be certain that insurance coverage
  for present or future products will continue to be available. Moreover, an
  adverse judgment in a products liability suit, even if insured or eventually
  overturned on appeal, could generate substantial negative publicity about our
  products and business and inhibit or prevent commercialization of other
  products.
  
  
  (ii) Phentermine
  
  Shire US Inc. (SUS) is a defendant in fifteen lawsuits still pending in both
  U.S. federal and state courts which seek damages for, among other things,
  personal injury arising from phentermine products supplied for the treatment of
  obesity by SUS and several other pharmaceutical companies. SUS, formerly known
  as Shire Richwood Inc., has been sued as a manufacturer and distributor of
  phentermine, an anorectic used in the short-term treatment of obesity and one of
  the products addressed by the lawsuits. The suits relate to phentermine either
  alone or together with fenfluramine or dexenfluramine. The lawsuits generally
  allege the following claims: the defendants marketed phentermine and other
  products for the treatment of obesity and misled users about the products and
  dangers associated with them; the defendants failed adequately to test
  phentermine individually and when taken in combination with the other drugs; and
  the defendants knew or should have known about the negative effects of the drugs
  and should have informed the public about such risks and/or failed to provide
  appropriate warning labels. SUS has been named as a defendant in a total of
  approximately 3,800 such phentermine lawsuits, but in all but the fifteen cases
  referenced above, SUS has been dismissed as a defendant.
  
  
  <PAGE>
  
  SUS became involved with phentermine through its acquisition of certain assets
  of Rexar Pharmacal Corporation (Rexar) in January 1994. In addition to SUS
  potentially incurring liability as a result of its own production of Oby-Cap, a
  phentermine product, the plaintiffs may additionally seek to impose liability on
  SUS as successor to Rexar. SUS intends vigorously to defend all the lawsuits and
  pursue all available reasonable defenses. SUS denies liability on a number of
  grounds including lack of scientific evidence that phentermine, properly
  prescribed, causes the alleged side effects and that SUS did not promote
  phentermine for long-term combined use as part of the "fen/phen" diet.
  Accordingly, SUS intends to defend vigorously any and all claims made against
  the Group in respect of phentermine and believes that liability is neither
  probable nor quantifiable at this stage of litigation. Legal expenses have been
  paid by Eon Labs Manufacturing Inc. (Eon), the supplier to SUS, or Eon's
  insurance carriers but such insurance is now exhausted. Eon has agreed to defend
  and indemnify SUS in this litigation pursuant to an agreement dated November 30,
  2000 between Eon and SUS.
  
  At the present stage of litigation, Shire is unable to estimate the level of
  future legal costs after taking into account any available product liability
  insurance and enforceable indemnities. To the extent that any legal costs are
  not covered by insurance or available indemnities, these will be expensed as
  incurred.
  
  (iii) ADDERALL
  
  Shire filed a Complaint against Barr Laboratories, Inc. on April 30, 2002 in the
  District Court of New Jersey. In the Complaint, Shire requested a preliminary
  and permanent injunction to prevent Barr from marketing a mixed amphetamine salt
  product in a trade dress similar to that of ADDERALL. Shire requested that Barr
  recall all such products and also asked for damages. An order denying the
  preliminary injunction was issued on August 26, 2002. Shire filed a Notice of
  Appeal to the United States Court of Appeals for the Third Circuit on September
  16, 2002 appealing the denial of Shire's motion for a preliminary injunction.
  
  (iv) Emory
  
  Shire BioChem was involved in worldwide patent disputes with Emory University
  (Emory) relating to lamivudine wherein Shire BioChem opposed certain patents and
  patent applications of Emory and wherein Emory opposed certain patents and
  patent applications of Shire BioChem. Pursuant to a global Settlement Agreement,
  finalized in May 2002, Emory has granted Shire and GSK an exclusive license
  under Emory's patent rights for lamivudine. The Settlement Agreement provides
  for the resolution of all worldwide patent disputes between the parties relating
  to lamivudine and FTC, including pending opposition and revocation proceedings
  in Europe, South Korea and Australia. The settlement involves a small royalty
  payment on worldwide sales of lamivudine and a license under Shire's FTC patent
  rights, in consideration for the settlement of all claims against Shire and GSK
  relating to lamivudine.
  
  Shire BioChem was also involved in worldwide patent disputes with Emory and the
  University of Georgia Research Foundation (Georgia) relating to certain
  dioxolane nucleoside analogs wherein Shire BioChem opposed certain patents and
  patent applications of Emory and Georgia and wherein Emory opposed a European
  patent of Shire BioChem. Pursuant to global Settlement and License Agreements
  finalized in August 2002 by Shire BioChem, Shire Pharmaceuticals Group, Georgia
  and Triangle Pharmaceuticals Inc. (Triangle), Shire will grant an exclusive
  royalty bearing license to Emory, sub licensable to Triangle, for certain
  dioxolane nucleoside analogs, including diamino purine dioxolane (DAPD). A low
  royalty will be payable to Shire in relation to this agreeement. Emory, Georgia
  and Triangle will grant an exclusive royalty bearing license to Shire for
  certain dioxolane nucleosides, including SPD 756. The compounds the subject of
  these licenses are in development. A low royalty will be payable by Shire upon
  commercialization of SPD 756. The Settlement and License Agreements provide for
  the resolution of all worldwide patent disputes relating to the licensed
  patents.
  
  
  (v) GSK
  
  On April 14, 2000, the USPTO declared an interference between BioChem's
  hepatitis B patent for lamivudine and a patent application by GSK claiming
  methods of treating hepatitis B using lamivudine. There is no guarantee that
  Shire will be successful in this interference and that Shire's patent will be
  maintained.
  
  
  <PAGE>
  
  (vi) Other matters
  
  In addition, the Company is involved in claims and lawsuits in the normal course
  of business. It is not possible at this time to determine the ultimate outcome
  of any of these claims.
  
  
  ITEM 2. CHANGES IN SECURITIES
  
  None
  
  
  ITEM 3. DEFAULTS UPON SENIOR SECURITIES
  
  None
  
  ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  
  None
  
  
  ITEM 5. OTHER INFORMATION
  
  The Audit Committee of the Board of Directors of Shire approved all non-audit
  services, including tax advisory and compliance services, provided by the
  Company's independent auditors, Deloitte and Touche, during the period covered
  by this report.
  
  
  ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K
  
  (a)      Exhibits
  
           None
  
  (b)      Reports on Form 8-K
  
           During the third quarter ended September 30, 2002, the following
           reports on Form 8-K were filed by the Company with the Securities and
           Exchange Commission:
  
           Form 8-K (Item 5 - Other Events, and Item 7 - Financial Statements and
           Exhibits), date of earliest event reported September 26, 2002, with
           respect to the issue of a press release announcing the 2002 Research &
           Development briefing.
  
  
  <PAGE>
  
           Form 8-K (Item 5 - Other Events, and Item 7 - Financial Statements and
           Exhibits), date of earliest event reported September 25, 2002, with
           respect to the issue of a press release announcing holdings by FMR Corp
           and Fidelity International Limited in the ordinary share capital of the
           Company, and to the issue of a press release announcing holdings by
           Franklin Resources Inc. in the ordinary share capital of the Company.
  
           Form 8-K (Item 5 - Other Events, and Item 7 - Financial Statements and
           Exhibits), date of earliest event reported September 24, 2002, with
           respect to the issue of a press release announcing the granting of
           share options to directors of the Company, pursuant to the Shire
           Pharmaceuticals Sharesave Scheme.
  
           Form 8-K (Item 5 - Other Events, and Item 7 - Financial Statements and
           Exhibits), date of earliest event reported September 20, 2002, with
           respect to the issue of a press release giving notice of the 2002
           Research & Development briefings.
  
  
  <PAGE>
  
  
           Form 8-K (Item 5 - Other Events, and Item 7 - Financial Statements and
           Exhibits), date of earliest event reported September 16, 2002, with
           respect to the issue of a press release announcing an update on
           FOSRENOL.
  
           Form 8-K (Item 4 - Changes in the Registrant's Certifying Accountant),
           on July 31, 2002 Arthur Andersen informed Shire Pharmaceuticals Group
           plc (the Registrant) that it would no longer be able to serve as the
           Registrant's independent auditors and submitted its letter of
           resignation. The Registrant subsequently engaged the services of
           Deloitte & Touche effective July 31, 2002.
  
  
  
  
  SIGNATURES
  
  Pursuant to the requirements of the Securities Exchange Act of 1934, the
  Registrant has duly caused this Report to be signed on its behalf by the
  undersigned thereunto duly authorized.
  
  SHIRE PHARMACEUTICALS GROUP PLC
  (Registrant)
  
  
  
  
  Date:    November 14, 2002      By:      Angus C Russell
                                           Group Finance Director
  
                                           /s/ Angus C Russell
  
  
  
  Date:    November 14, 2002      By:      Rolf Stahel
                                           Chief Executive
  
                                           /s/ Rolf Stahel
  
  
  <PAGE>
  
  CERTIFICATIONS
  
  
            CERTIFICATION OF THE PRINCIPAL FINANCIAL OFFICER PURSUANT TO
                    SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
  
  
  I, Angus C Russell, certify that:
  
  
  1.   I have reviewed this quarterly report on Form 10-Q of Shire Pharmaceuticals
       Group plc (the Registrant);
  
  
  2.   Based on my knowledge, this quarterly report does not contain any untrue
       statement of a material fact or omit to state a material fact necessary to
       make the statements made, in light of the circumstances under which such
       statements were made, not misleading with respect to the period covered by
       this quarterly report;
  
  
  3.   Based on my knowledge, the financial statements, and other financial
       information included in this quarterly report, fairly present in all
       material respects the financial condition, results of operations and cash
       flows of the registrant as of, and for, the periods presented in this
       quarterly report;
  
  
  4.   The registrant's other certifying officers and I are responsible for
       establishing and maintaining disclosure controls and procedures (as defined
       in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
  
       a)   designed such disclosure controls and procedures to ensure that
            material information relating to the registrant, including its
            consolidated subsidiaries, is made known to us by others within those
            entities, particularly during the period in which this quarterly
            report is being prepared;
  
       b)   evaluated the effectiveness of the registrant's disclosure controls
            and procedures as of a date within 90 days prior to the filing date of
            this quarterly report (the "Evaluation Date"); and
  
       c)   presented in this quarterly report our conclusions about the
            effectiveness of the disclosure controls and procedures based on our
            evaluation as of the Evaluation Date;
  
  
  5.   The registrant's other certifying officers and I have disclosed, based on
       our most recent evaluation, to the registrant's auditors and the audit
       committee of registrant's board of directors (or persons performing the
       equivalent function):
  
       a)   all significant deficiencies in the design or operation of internal
            controls which could adversely affect the registrant's ability to
            record, process, summarize and report financial data and have
            identified for the registrant's auditors any material weaknesses in
            internal controls; and
  
       b)   any fraud, whether or not material, that involves management or other
            employees who have a significant role in the registrant's internal
            controls; and
  
  6.   The registrant's other certifying officers and I have indicated in this
       quarterly report whether or not there were significant changes in internal
       controls or in other factors that could significantly affect internal
       controls subsequent to the date of our most recent evaluation, including
       any corrective actions with regard to significant deficiencies and material
       weaknesses.
  
  
  
  Date: November 14, 2002
  
  
  /s/ Angus C Russell
  ------------------------
  Angus C Russell
  Group Finance Director
  
  
  
  
  <PAGE>
  
  
  
            CERTIFICATION OF THE PRINCIPAL EXECUTIVE OFFICER PURSUANT TO
                    SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
  
  
  I, Rolf Stahel, certify that:
  
  
  1.   I have reviewed this quarterly report on Form 10-Q of Shire Pharmaceuticals
       Group plc (the Registrant);
  
  
  2.   Based on my knowledge, this quarterly report does not contain any untrue
       statement of a material fact or omit to state a material fact necessary to
       make the statements made, in light of the circumstances under which such
       statements were made, not misleading with respect to the period covered by
       this quarterly report;
  
  
  3.   Based on my knowledge, the financial statements, and other financial
       information included in this quarterly report, fairly present in all
       material respects the financial condition, results of operations and cash
       flows of the registrant as of, and for, the periods presented in this
       quarterly report;
  
  
  4.   The registrant's other certifying officers and I are responsible for
       establishing and maintaining disclosure controls and procedures (as defined
       in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
  
       a)   designed such disclosure controls and procedures to ensure that
            material information relating to the registrant, including its
            consolidated subsidiaries, is made known to us by others within those
            entities, particularly during the period in which this quarterly
            report is being prepared;
  
       b)   evaluated the effectiveness of the registrant's disclosure controls
            and procedures as of a date within 90 days prior to the filing date of
            this quarterly report (the "Evaluation Date"); and
  
       c)   presented in this quarterly report our conclusions about the
            effectiveness of the disclosure controls and procedures based on our
            evaluation as of the Evaluation Date;
  
  
  5.   The registrant's other certifying officers and I have disclosed, based on
       our most recent evaluation, to the registrant's auditors and the audit
       committee of registrant's board of directors (or persons performing the
       equivalent function):
  
       a)   all significant deficiencies in the design or operation of internal
            controls which could adversely affect the registrant's ability to
            record, process, summarize and report financial data and have
            identified for the registrant's auditors any material weaknesses in
            internal controls; and
  
       b)   any fraud, whether or not material, that involves management or other
            employees who have a significant role in the registrant's internal
            controls; and
  
  6.   The registrant's other certifying officers and I have indicated in this
       quarterly report whether or not there were significant changes in internal
       controls or in other factors that could significantly affect internal
       controls subsequent to the date of our most recent evaluation, including
       any corrective actions with regard to significant deficiencies and material
       weaknesses.
  
  
  Date: November 14, 2002
  
  
  /s/ Rolf Stahel
  ------------------------
  Rolf Stahel
  Chief Executive
  
  
  
  <PAGE>
  
  
                                    Certification
                            Accompanying Form 10-Q Report
                         of Shire Pharmaceuticals Group plc
              Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
                  (Chapter 63, Title 18 U.S.C. ss.1350(a) and (b))
  
  
       Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chapter 63,
  Title 18 U.S.C. ss.1350(a) and (b)), each of the undersigned hereby certifies
  that, to the best of their knowledge and belief, the Quarterly Report on Form
  10-Q for the period ended September 30, 2002 of Shire Pharmaceuticals Group plc
  ("Company") fully complies with the requirements of Section 13(a) or Section
  15(d) of the Securities Exchange Act of 1934 and that the information contained
  in such Report fairly presents, in all material respects, the financial
  condition and results of operations of the Company.
  
  
  
  
  Dated:  November 14, 2002               /s/ Rolf Stahel
                                          --------------------------------
                                          Rolf Stahel
                                          Chief Executive
                                          Shire Pharmaceuticals Group plc
  
  
  Dated:  November 14, 2002               /s/ Angus C Russell
                                          --------------------------------
                                          Angus C. Russell
                                          Group Finance Director
                                          Shire Pharmaceuticals Group plc
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text: FORM 10-Q
                         SECURITIES AND EXCHANGE COMMISSION
                               Washington, D.C. 20549
  
                 QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                        THE SECURITIES EXCHANGE ACT OF 1934
                      For the Quarter Ended September 30, 2002
  
                           Commission File Number: 0-29630
  
                           SHIRE PHARMACEUTICALS GROUP PLC
               (Exact name of registrant as specified in its charter)
  
                      England and Wales                           98-0359573
                (State or other jurisdiction                   (I.R.S. Employer
              of incorporation or organization)              Identification No.)
  
      Hampshire International Business Park, Chineham,
               Basingstoke, Hampshire, England                     RG24 8EP
          (Address of principal executive offices)                (Zip Code)
  
                                   44 1256 894 000
                (Registrant's telephone number, including area code)
  
  Indicate by check mark whether the registrant (1) has filed all reports required
  to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
  the preceding 12 months, and (2) has been subject to such filing requirements
  for the past 90 days.
  
                                                              Yes  X    No  ___
  
  Indicate the number of shares outstanding of each of the issuer's classes of
  Common Stock, as of the latest practical date.
  
              Class                             Outstanding at October 31, 2002
  Common Stock: Ordinary Shares                           501,333,970
  THE "SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT
  OF 1995
  
  Statements included herein that are not historical facts, are forward-looking
  statements. Such forward-looking statements involve a number of risks and
  uncertainties and are subject to change at any time. In the event that such
  risks or uncertainties materialize, Shire's results could be materially
  affected. The risks and uncertainties include, but are not limited to, risks
  associated with the inherent uncertainty of pharmaceutical research, product
  development, manufacturing and commercialization, the impact of competitive
  products, including but not limited to the impact of same on Shire's ADHD
  franchise, patents, government regulation and approval, including but not
  limited to the expected approval date of lanthanum carbonate (FOSRENOL(TM)), and
  other risks and uncertainties detailed from time to time in our filings,
  including the Annual Report filed on Form 10-K by Shire with the Securities and
  Exchange Commission.
  PART I.  FINANCIAL INFORMATION
  
  ITEM 1.  Financial Statements
  SHIRE PHARMACEUTICALS GROUP PLC
                             CONSOLIDATED BALANCE SHEETS
           (In thousands of U.S. dollars, except share and per share data)
  
                                                                                       (Unaudited)
                                                                                     September 30,          December 31,
                                                                                              2002                  2001
  ASSETS                                                                               -----------           -----------
  Current assets:
  Cash and cash equivalents                                                                694,615               118,040
  Marketable securities and other current asset investments                                268,665               723,911
  Accounts receivable, net                                                                 171,493               193,913
  Inventories, net                                                                          61,485                46,690
  Deferred tax asset                                                                        24,116                19,430
  Prepaid expenses and other current assets                                                 51,124                38,571
                                                                                      ------------          ------------
  Total current assets                                                                   1,271,498             1,140,555
  
  Investments                                                                               76,639                68,743
  Property, plant and equipment, net                                                       127,639               113,347
  Intangible assets, net                                                                   574,197               549,044
  Deferred tax asset                                                                         2,726                12,874
  Other assets                                                                              23,530                26,168
                                                                                      ------------          ------------
  Total assets                                                                           2,076,229             1,910,731
                                                                                      ------------          ------------
  LIABILITIES AND SHAREHOLDERS' EQUITY
  Current liabilities:
  Current instalments of long-term debt                                                        946                 4,325
  Accounts and notes payable                                                               160,744               167,152
  Unearned income                                                                                -                17,409
  Other current liabilities                                                                  9,511                42,730
                                                                                      ------------          ------------
  Total current liabilities                                                                171,201               231,616
  Long-term debt, excluding current instalments                                            407,922               402,481
  Other long-term liabilities                                                               11,803                13,645
                                                                                      ------------          ------------
  Total liabilities                                                                        590,926               647,742
                                                                                      ------------          ------------
  Shareholders' equity:
  Common stock, 5p par value: 800,000,000 shares authorized; and
  483,688,065 shares issued and outstanding (2001: 481,817,487)                             39,980                39,861
  Exchangeable shares: 5,876,415 shares issued and outstanding (2001:
  5,978,902)                                                                               272,618               277,386
  Additional paid-in capital                                                             1,025,899             1,014,796
  Accumulated other comprehensive losses                                                  (56,843)              (93,009)
  Accumulated surplus                                                                      203,649                23,955
                                                                                      ------------          ------------
  Total shareholders' equity                                                             1,485,303             1,262,989
                                                                                      ------------          ------------
  Total liabilities and shareholders' equity                                             2,076,229             1,910,731
                                                                                      ------------          ------------
  The accompanying notes are an integral part of these financial statements.
  SHIRE PHARMACEUTICALS GROUP PLC
                          CONSOLIDATED STATEMENTS OF INCOME
           (In thousands of U.S. dollars, except share and per share data)
                                     (Unaudited)
  
                                                          3 months to      3 months to           9 months          9 months
                                                        September 30,    September 30,                 to                to
                                                                 2002             2001      September 30,     September 30,
                                                                                                     2002              2001
                                                         ------------     ------------       ------------      ------------
  Product sales                                               212,041          177,275            627,674           497,366
  Licensing and development                                       726              943              2,331             4,229
  Royalties                                                    43,485           37,810            123,573           109,873
  Other revenues                                                    5              784                 10             1,530
                                                         ------------     ------------       ------------      ------------
  Total revenues                                              256,257          216,812            753,588           612,998
  
  Costs and expenses:
  Cost of revenues                                             33,337           27,037             91,022            82,081
  Research and development                                     42,026           41,327            138,557           120,838
  Selling, general and administrative (inclusive
  of stock option compensation (credit)/charge of
  ($16,000), $51,000, ($166,000) and $2,403,000
  respectively)                                                97,037           71,963            289,587           216,290
  Asset impairments and restructuring charges                       -                -                  -            85,447
  Merger transaction expenses                                       -                -                  -            83,470
  Losses on dispositions of assets                                 37            2,028                153            10,126
                                                         ------------     ------------       ------------      ------------
  Total operating expenses                                    172,437          142,355            519,319           598,252
                                                         ------------     ------------       ------------      ------------
  Operating income                                             83,820           74,457            234,269            14,746
  
  Interest income                                               5,142            4,640             14,693            14,251
  Interest expense                                            (2,280)            (989)            (6,053)           (5,671)
  Other income/(expense), net                                     904            (182)              3,734             3,497
                                                         ------------     ------------       ------------      ------------
  Total other income, net                                       3,766            3,469             12,374            12,077
                                                          -----------      -----------        -----------       -----------
  Income before income taxes                                   87,586           77,926            246,643            26,823
  
  Income taxes                                               (24,001)         (19,815)           (66,949)          (51,439)
                                                         ------------     ------------       ------------      ------------
  Net income/(loss)                                            63,585           58,111            179,694          (24,616)
                                                         ------------     ------------       ------------      ------------
  
  Net income/(loss) per common share:
  Basic                                                         12.7c            11.8c              35.9c            (5.0)c
  Diluted                                                       12.4c            11.4c              35.1c            (5.0)c
  
  Weighted average number of shares:
  Basic                                                   501,026,581      493,790,267        500,394,452       490,750,414
  Diluted                                                 524,130,078      503,914,740        524,058,558       490,750,414
  SHIRE PHARMACEUTICALS GROUP PLC
                        CONSOLIDATED STATEMENT OF CASH FLOWS
                           (In thousands of U.S. dollars)
                                     (Unaudited)
  9 months to September 30,                                                                           2002            2001
                                                                                           ---------------  ---------------
  Cash flows from operating activities:
  Net income/(loss)                                                                                179,694        (24,616)
  Adjustments to reconcile net income/(loss) to net cash provided by operating
  activities:
  Depreciation and amortization                                                                     34,860          33,753
  Stock option compensation                                                                          (166)           2,403
  Tax benefit of stock option compensation charged directly to equity                                  687           3,307
  Non cash exchange gains and losses                                                                 2,935        (15,167)
  Write-down of long-term investments                                                                5,500          24,937
  Write-down of intangible assets                                                                        -          20,890
  Write-down of net assets of business transferred under contractual arrangements
                                                                                                         -          30,811
  Loss on sale of fixed assets                                                                         153           8,112
  Loss on sale of intangible assets                                                                      -           2,014
  Changes in assets and liabilities:
  Decrease in accounts receivable                                                                   25,032           1,551
  Increase in inventory                                                                           (15,706)           (420)
  Decrease in deferred tax asset                                                                     5,462          10,137
  Increase in prepayments and other current asset investments                                      (9,546)        (13,004)
  Decrease in other assets                                                                           2,638           8,500
  (Decrease)/increase in accounts and notes payable                                               (15,374)          44,699
  Decrease in unearned income                                                                     (17,409)               -
  Decrease in other current liabilities                                                           (28,116)        (17,577)
  Decrease in other long-term liabilities                                                          (1,841)         (3,008)
                                                                                           ---------------  ---------------
  Net cash provided by operating activities                                                        168,803         117,322
                                                                                           ---------------  ---------------
  Cash flows from investing activities:
  Investment in marketable securities, net                                                               -        (18,450)
  Decrease in short-term deposits                                                                  455,114         127,911
  Purchase of long-term investments                                                                (6,921)        (13,216)
  Purchase of subsidiary undertakings                                                             (17,000)               -
  Purchase of intangible assets                                                                   (19,227)        (33,519)
  Purchase of fixed assets                                                                        (11,613)         (6,305)
  Proceeds from sale of intangible assets                                                                -           4,556
  Proceeds from sale of fixed assets                                                                     -           7,043
                                                                                           ---------------  ---------------
  Net cash provided by investing activities                                                        400,353          68,020
                                                                                           ---------------  ---------------
  Cash flows from financing activities:
  Proceeds from issue of long-term debt                                                                  -         391,000
  Payments on long-term debt and notes                                                             (2,728)       (206,990)
  Proceeds from issue of common stock, net of expenses                                                   -           1,526
  Proceeds from exercise of options                                                                  4,455          50,514
                                                                                           ---------------  --------------
  Net cash provided by financing activities                                                          1,727         236,050
                                                                                           ---------------  --------------
  Effect of foreign exchange rate changes on cash and cash equivalents                               5,692             340
                                                                                           ---------------  --------------
  Net increase in cash and cash equivalents                                                        576,575         421,732
  Cash and cash equivalents at beginning of period                                                 118,040          93,266
                                                                                           ---------------  --------------
  Cash and cash equivalents at end of period                                                       694,615         514,998
                                                                                           ---------------  --------------
  CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME/(LOSS)
                           (In thousands of U.S. dollars)
                                     (Unaudited)
  
                                                       3 months to       3 months to       9 months to       9 months to
                                                     September 30,     September 30,     September 30,     September 30,
                                                              2002              2001              2002              2001
                                                      ------------      ------------      ------------      ------------
  Net income/(loss)                                         63,585            58,111           179,694          (24,616)
  Foreign currency translation adjustments                 (1,513)            13,424            36,166          (16,139)
  Unrealized holding losses on non-current
  investments                                                    -             (312)                 -             (508)
                                                      ------------      ------------      ------------      ------------
  Comprehensive income/(loss)                               62,072            71,223           215,860          (41,263)
                                                      ------------      ------------      ------------      ------------
  
  There are no tax effects related to the items included above.
  SHIRE PHARMACEUTICALS GROUP PLC
                   NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                                     (UNAUDITED)
  
  1. Summary of Significant Accounting Policies
  
  a) Description of Operations and Principles of Consolidation
  
  Shire Pharmaceuticals Group plc (Shire), and subsidiaries (collectively, the
  Company) is an international specialty pharmaceutical company with a strategic
  focus on four therapeutic areas: central nervous system disorders, gastro
  intestinal, oncology and anti-infectives. The Company's strategy is further
  supported by three technology platforms, lead optimization for small molecules,
  drug delivery and biologics.
  
  Shire has sales and marketing subsidiaries with a portfolio of products
  targeting the U.S., Canada, the U.K., the Republic of Ireland, France, Germany,
  Italy and Spain. Shire also covers other significant pharmaceutical markets
  indirectly through distributors. The business is operated and managed within
  three individual operating segments: U.S., International and global research and
  development. Within these segments, revenues are derived primarily from three
  sources: sales of products by Shire's own sales and marketing operations,
  royalties and licensing and development fees.
  
  The Company is referred to as "specialty" because its principal products tend to
  be prescribed by specialists as opposed to primary care physicians. The
  Company's main approach is to start projects in-house through research and
  advanced drug delivery or to in-license projects, and then to develop them and
  launch them using its sales and marketing capability in the key world
  pharmaceutical markets. To complete its geographic coverage, Shire intends to
  build a presence in Japan in the mid-term. The Company seeks to protect the
  intellectual property upon which it relies through a range of patents and patent
  applications (both its own and those of its licensors).
  
  The Company's principal products include:
  
       o    in the U.S., ADDERALL XR(TM) and ADDERALL(TM) for the treatment of
            Attention Deficit Hyperactivity Disorder (ADHD); AGRYLIN(TM) for the
            treatment of elevated blood platelets; PENTASA(TM) for the treatment
            of ulcerative colitis; CARBATROL(TM) for the treatment of epilepsy;
            and PROAMATINE(TM) for the treatment of postural hypotension. In
            addition, the Company receives royalties on sales of REMINYL* for the
            treatment of Alzheimer's disease, marketed by Johnson & Johnson, and
            on EPIVIR**, COMBIVIR** and TRIZIVIR** for the treatment of HIV/AIDS
            and EPIVIR-HBV** for the treatment of hepatitis B, each marketed by
            GlaxoSmithKline (G-SK);
  
       o    in the U.K. and the Republic of Ireland, the CALCICHEW(TM)range, used
            primarily as adjuncts in the treatment of osteoporosis, and REMINYL,
            which was launched in September 2000 and is co-promoted by
            Janssen-Cilag;
  
       o    in Canada, 3TC** for the treatment of HIV/AIDS, COMBIVIR and
            HEPTOVIR** (all marketed in partnership with GlaxoSmithKline);
            AMATINE(TM); SECOND LOOK(TM), a breast cancer diagnostics product for
            which the Company received FDA approval in January 2002; and FLUVIRAL
            S/F(TM), a vaccine for the prevention of influenza; and
  
       o    in the Rest of the World, royalties on the sales of ZEFFIX** for the
            treatment of hepatitis B, marketed by GlaxoSmithKline, and royalties
            on sales of REMINYL from Janssen Pharmaceutica.
  
  In addition, the Company has a number of products in late stage development
  including FOSRENOL(TM) for the treatment of high blood phosphate levels
  associated with kidney failure and TROXATYL(TM) for the treatment of leukemia
  and pancreatic cancer. The Company submitted the first regulatory submission for
  FOSRENOL under the European Mutual Recognition procedure on March 13, 2001 and a
  New Drug Application with the U.S. FDA on April 30, 2002.
  
  The accompanying consolidated financial statements include the accounts of Shire
  Pharmaceuticals Group plc and all its subsidiary undertakings after elimination
  of intercompany accounts and transactions.
  
  *        Registered trademark of Johnson and Johnson
  **       Registered trademark of GlaxoSmithKline
  (TM)     Unless otherwise indicated, all product names set out in this document
           are trademarks of Shire or companies within the Shire Group, many of
           which are the subject of trademark registrations in certain
           territories.
  b) Basis of Presentation
  
  These interim financial statements, which include the operations of the Company
  and its wholly owned subsidiaries and the financial information included herein,
  are unaudited. They have been prepared in accordance with generally accepted
  accounting principles in the United States and Securities and Exchange
  Commission regulations for interim reporting. Certain information and footnote
  disclosures normally included in financial statements prepared in accordance
  with generally accepted accounting principles in the United States have been
  condensed or omitted pursuant to such rules and regulations. However, such
  information includes all adjustments (consisting solely of normal recurring
  adjustments), which are, in the opinion of management, necessary to fairly state
  the results of the interim periods. Interim results are not necessarily
  indicative of results to be expected for the full year.
  
  The December 31, 2001 balance sheet was derived from audited financial
  statements but does not include all disclosures required by US GAAP. However,
  the Company believes that the disclosures are adequate to make the information
  presented not misleading.
  
  These interim financial statements should be read in conjunction with the
  Company's consolidated balance sheets as of December 31, 2001 and 2000, and the
  related consolidated statements of operations, cash flows and changes in
  stockholders' equity for each of the three years in the period ended December
  31, 2001.
  
  c) New Accounting Pronouncements
  
  In June 2001, the FASB issued SFAS No. 143, Accounting for Asset Retirement
  Obligations. SFAS No. 143 requires that the fair value of a liability for asset
  retirement obligations be recognized in the period in which it is incurred if a
  reasonable estimate of the fair value can be made. The associated asset
  retirement costs are capitalized as part of the carrying amount of the related
  long-lived asset. SFAS No. 143 is effective for financial statements issued for
  fiscal years beginning after June 15, 2002. The Company has assessed the
  potential impact of the adoption of SFAS No. 143 and concluded that there is no
  impact.
  
  In August 2001, the FASB issued SFAS No. 144, Accounting for the Impairment or
  Disposal of Long-Lived Assets, which addresses financial accounting and
  reporting for the impairment or disposal of long-lived assets and supersedes
  SFAS No. 121, Accounting for the Impairment of Long-Lived Assets and for
  Long-Lived Assets to be Disposed Of, and the accounting and reporting provisions
  of APB Opinion No. 30, Reporting the Results of Operations, for a disposal of a
  segment of a business. SFAS No. 144 is effective for fiscal years beginning
  after December 15, 2001. The adoption of SFAS No. 144 has had no significant
  impact on our financial position and results of operations.
  
  In April 2002, the FASB issued SFAS No. 145, Rescission of FASB Statements No.4,
  44 and 64, Amendment of FASB Statement No.13 and Technical Corrections. The
  principal change is that gains or losses from extinguishment of debt which are
  classified as extraordinary items by SFAS No. 4 will no longer be classified as
  such. The provisions of SFAS No. 145 are effective for fiscal years beginning
  after May 15, 2002 although early application of the Statement related to the
  rescission of SFAS No. 4 is encouraged. The Company plans to adopt SFAS 145 for
  its fiscal year ending December 31, 2003. When adopted, prior extraordinary
  items related to the extinguishment of debt will need to be reclassified.
  
  In June 2002, the FASB issued SFAS No. 146, Accounting for Costs Associated with
  Exit or Disposal Activities, which addresses accounting and processing for costs
  associated with exit or disposal activities and nullifies Emerging Issues Task
  Force (EITF) Issue 94-3, Liability Recognition for Certain Employee Termination
  Benefits and Other Costs to Exit and Activity (including Certain Costs Incurred
  in a Restructuring). SFAS No. 146 requires that a liability for a cost
  associated with an exit or disposal liability be recognized when the liability
  is incurred. Under Issue 94-3, a liability for an exit cost was recognized at
  the date of an entity's commitment to an exit plan. Under SFAS No. 146, fair
  value is the objective for initial measurement of the liability. SFAS No. 146 is
  effective for exit or disposal activities that are initiated after December 31,
  2002, with early application encouraged. We do no expect the adoption of SFAS
  No. 146 to have a material impact on our financial position, results of
  operations or cash flows.
  2. Inventory
  
                                    September 30,            December 31,
                                             2002                    2001
                                            $'000                   $'000
                                   --------------          --------------
  Finished goods                           31,273                  19,880
  Work-in-process                          21,551                  18,262
  Raw materials                             8,661                   8,548
                                   --------------          --------------
                                           61,485                  46,690
                                   --------------          --------------
  3. Analysis of revenue, operating income and reportable segments
  
  The Company has disclosed segment information for the individual operating areas
  of the business based on the way in which the business is managed and
  controlled. Shire's principal reporting segments are U.S., International and
  Global Research and Development, each being managed and monitored separately.
  The Company evaluates performance based on operating income.
  Three months ended September 30, 2002                           U.S.   International              R&D           Total
                                                                 $'000           $'000            $'000           $'000
                                                            ----------      ----------       ----------      ----------
  Product sales                                                173,532          38,509                -         212,041
  Licensing and development                                        726               -                -             726
  Royalties                                                          -          43,485                -          43,485
  Other revenues                                                     -               5                -               5
                                                            ----------      ----------       ----------      ----------
  Total revenues                                               174,258          81,999                -         256,257
                                                            ----------      ----------       ----------      ----------
  
  Cost of revenues                                              13,103          20,234                -          33,337
  Research and development                                           -               -           42,026          42,026
  Selling, general and administrative                           47,353          37,136                -          84,489
  Depreciation and amortization                                  7,548           5,000                -          12,548
  Loss on dispositions of assets                                    37               -                -              37
                                                            ----------      ----------       ----------      ----------
  Total operating expenses                                      68,041          62,370           42,026         172,437
                                                            ----------      ----------       ----------      ----------
  Operating income/(loss)                                      106,217          19,629         (42,026)          83,820
                                                            ----------      ----------       ----------      ----------
  
  Three months ended September 30, 2001                           U.S.   International              R&D           Total
                                                                 $'000           $'000            $'000           $'000
                                                            ----------      ----------       ----------      ----------
  Product sales                                                149,853          27,422                -         177,275
  Licensing and development                                        943               -                -             943
  Royalties                                                         44          37,766                -          37,810
  Other revenues                                                     -             784                -             784
                                                            ----------      ----------       ----------      ----------
  Total revenues                                               150,840          65,972                -         216,812
                                                            ----------      ----------       ----------      ----------
  
  Cost of revenues                                              13,264          13,773                -          27,037
  Research and development                                           -               -           41,327          41,327
  Selling, general and administrative                           34,968          25,269                -          60,237
  Depreciation and amortization                                  3,000           8,726                -          11,726
  Losses on dispositions of assets                               2,014              14                -           2,028
                                                            ----------      ----------       ----------      ----------
  Total operating expenses                                      53,246          47,782           41,327         142,355
                                                            ----------      ----------       ----------      ----------
  Operating income/(loss)                                       97,594          18,190         (41,327)          74,457
                                                            ----------      ----------       ----------      ----------
  
  Intra-segment group income earned and eliminated from the above table was $23.2
  for the three months ended September 30, 2002 (2001: $12.0 million). The R&D
  segment received revenue of $17.9 million from the US segment (2001: $9.3
  million), and the US segment received revenue of $5.3 million from the
  International segment (2001: $2.7 million).
  Nine months ended September 30, 2002                           U.S.     International              R&D             Total
                                                                $'000             $'000            $'000             $'000
                                                           ----------        ----------       ----------        ----------
  Product sales                                               527,005           100,669                -           627,674
  Licensing and development                                     1,929               402                -             2,331
  Royalties                                                       221           123,352                -           123,573
  Other revenues                                                    -                10                -                10
                                                           ----------        ----------       ----------        ----------
  Total revenues                                              529,155           224,433                -           753,588
                                                           ----------        ----------       ----------        ----------
  
  Cost of revenues                                             46,044            44,978                -            91,022
  Research and development                                          -                 -          138,557           138,557
  Selling, general and administrative                         161,096            93,631                -           254,727
  Depreciation and amortization                                21,027            13,833                -            34,860
  Loss on dispositions of assets                                  153                 -                -               153
                                                           ----------        ----------       ----------        ----------
  Total operating expenses                                    228,320           152,442          138,557           519,319
                                                           ----------        ----------       ----------        ----------
  Operating income/(loss)                                     300,835            71,991        (138,557)           234,269
                                                           ----------        ----------       ----------        ----------
  
  Nine months ended September 30, 2001                           U.S.     International              R&D             Total
                                                                $'000             $'000            $'000             $'000
                                                           ----------        ----------       ----------        ----------
  Product sales                                               418,305            79,061                -           497,366
  Licensing and development                                     3,272               957                -             4,229
  Royalties                                                       224           109,649                -           109,873
  Other revenues                                                    -             1,530                -             1,530
                                                           ----------        ----------       ----------        ----------
  Total revenues                                              421,801           191,197                -           612,998
                                                           ----------        ----------       ----------        ----------
  
  Cost of revenues                                             48,756            33,325                -            82,081
  Research and development                                          -                 -          120,838           120,838
  Selling, general and administrative                         116,951            65,586                -           182,537
  Depreciation and amortization                                12,870            20,883                -            33,753
  Asset impairments and restructuring charges
                                                                    -            85,447                -            85,447
  Merger transaction expenses                                       -            83,470                -            83,470
  Losses on dispositions of assets                              2,014             8,112                -            10,126
                                                           ----------        ----------       ----------        ----------
  Total operating expenses                                    180,591           296,823          120,838           598,252
                                                           ----------        ----------       ----------        ----------
  Operating income/(loss)                                     241,210         (105,626)        (120,838)            14,746
                                                           ----------        ----------       ----------        ----------
  Intra-segment group income earned and eliminated from the above table was $49.5
  million for the nine months ended September 30, 2002 (2001: $41.7 million). The
  R&D segment received revenue of $36.2 million from the US segment (2001: $29.3
  million), and the US segment received revenue of $13.3 million from the
  International segment (2001: $12.4 million).
  4. Net income/(loss) per share
  
  Basic net income/(loss) per share is based upon the net income/(loss) available
  to common stockholders divided by the weighted-average number of common shares
  outstanding during the period. Diluted net income/(loss) per share is based upon
  net income/(loss) available to common stockholders divided by the
  weighted-average number of common shares outstanding during the period and
  adjusted for the effect of all dilutive potential common shares that were
  outstanding during the period.
  
  The following table sets forth the computation of basic and diluted net
  income/(loss) per share:
  3 months to       3 months to      9 months to      9 months to
                                                           September 30,     September 30,    September 30,    September 30,
                                                                    2002              2001             2002             2001
                                                                   $'000             $'000            $'000            $'000
                                                        ----------------  ----------------  ---------------- ----------------
  Numerator for basic net income/(loss) per share                 63,585            58,111          179,694         (24,616)
  Interest charged on convertible debt, net of tax                 1,380                22            4,188                -
                                                        ----------------  ----------------  ---------------- ----------------
  Numerator for diluted net income/(loss) per share               64,965            58,133          183,882         (24,616)
                                                        ----------------  ----------------  ---------------- ----------------
  
  Weighted average number of shares:                       No. of shares     No. of shares    No. of shares    No. of shares
                                                        ----------------  ----------------  ---------------- ----------------
  Basic  - weighted average number of shares
                                                             501,026,581       493,790,267      500,394,452      490,750,414
  Effect of dilutive stock options                             1,993,136         9,543,434        2,553,745                -
  Warrants                                                     1,263,184           298,595        1,263,184                -
  Convertible debt                                            19,847,177           282,444       19,847,177                -
                                                        ----------------  ----------------  ---------------- ----------------
  Diluted - weighted average number of shares                524,130,078       503,914,740      524,058,558      490,750,414
                                                        ----------------  ----------------  ---------------- ----------------
  Basic net income/(loss) per share                                12.7c             11.8c            35.9c           (5.0c)
                                                        ----------------  ----------------  ---------------- ----------------
  Diluted net income/(loss) per share                              12.4c             11.4c            35.1c           (5.0c)
                                                        ----------------  ----------------  ---------------- ----------------
  The calculation of weighted average number of shares for the nine months ended
  September 30, 2001 does not include share options, warrants or convertible debt
  because their inclusion in a loss making period would be anti-dilutive.
  
  5. Goodwill and Other Intangible Assets - Adoption of Statement 142
  
  SFAS No. 142 is effective for fiscal years beginning after December 15, 2001.
  The statement directs that goodwill and intangible assets that have indefinite
  useful lives will not be amortized but rather will be tested at least annually
  for impairment. Intangible assets that have finite useful lives will continue to
  be amortized over their useful lives, but without the constraint of an arbitrary
  ceiling.
  
  a) Goodwill
  
  A reconciliation table for the results for the three and nine months ended
  September 30, 2001 is provided to exclude the effect of goodwill amortization in
  accordance with transitional disclosures relating to SFAS 142. Results for the
  three and nine months ended September 30, 2002 have been prepared in accordance
  with SFAS 142.
  A transitional assessment of goodwill impairment as of January 1, 2002 has been
  completed. The Company has concluded that the fair value of its individual
  reporting units exceeds the carrying value of the net assets including goodwill,
  and hence no adjusting entry is necessary.
  3 months to       3 months to      9 months to      9 months to
                                                           September 30,     September 30,    September 30,    September 30,
                                                                    2002              2001             2002             2001
                                                                   $'000             $'000            $'000            $'000
                                                        ----------------  ----------------  ---------------- ----------------
  Reported net income/(loss)                                      63,585            58,111          179,694         (24,616)
  Add back: Goodwill amortization                                      -             2,704                -            8,054
                                                        ----------------  ----------------  ---------------- ----------------
  Adjusted net income/(loss)                                      63,585            60,815          179,694         (16,562)
  Interest charged on convertible debt, net of tax                 1,380                22            4,188                -
                                                        ----------------  ----------------  ---------------- ----------------
  Numerator for diluted net income/(loss) per share               64,965            60,837          183,882         (16,562)
                                                        ----------------  ----------------  ---------------- ----------------
  
  Weighted average number of shares:                       No. of shares     No. of shares    No. of shares    No. of shares
                                                        ----------------  ----------------  ---------------- ----------------
  Basic                                                      501,026,581       493,790,267      500,394,452      490,750,414
  Diluted                                                    524,130,078       503,914,740      524,058,558      490,750,414
  
  Basic earnings per share:
  Reported net income/(loss)                                       12.7c             11.8c            35.9c           (5.0c)
  Goodwill amortization (net of tax effect)                            -              0.5c                -             1.6c
                                                        ----------------  ----------------  ---------------- ----------------
  Adjusted net income/(loss)                                       12.7c             12.3c            35.9c           (3.4c)
                                                        ----------------  ----------------  ---------------- ----------------
  Diluted earnings per share:
  Reported net income/(loss)                                       12.4c             11.4c            35.1c           (5.0c)
  Goodwill amortization (net of tax effect)                            -              0.7c                -             1.6c
                                                        ----------------  ----------------  ---------------- ----------------
  Adjusted net income/(loss)                                       12.4c             12.1c            35.1c           (3.4c)
                                                        ----------------  ----------------  ---------------- ----------------
  The calculation of the diluted weighted average number of shares for the nine
  months ended September 30, 2001 excludes the effects of share options, warrants
  and convertible debt because their inclusion in a loss making period would be
  anti-dilutive.
  
  There is no tax effect related to the inclusion of goodwill amortization in the
  earnings calculation disclosed above.
  
  b) Intangible fixed assets
  
                                             September 30,       September 30,
                                                      2002                2001
                                                     $'000               $'000
                                              ------------        ------------
  Intellectual property rights acquired            484,947             469,745
  Less: Accumulated amortization                 (109,164)            (88,148)
                                              ------------        ------------
                                                   375,783             381,597
                                              ------------        ------------
  
  The useful economic lives of all intangible assets have been reassessed in
  accordance with SFAS No. 142.
  Management estimates that the annual amortization charge in respect of
  intangible fixed assets held at September 30, 2002 will be approximately $35
  million for each of the five years to September 30, 2007. Estimated amortization
  expense can be affected by various factors including future acquisitions and
  disposals of product rights.
  
  6. Consolidated statement of changes in shareholders' equity
  Accumu-
                                                             Exchan-                             lated
                                     Common      Exchan-     geable                              other       Total
                         Common      Stock       geable      shares    Additional    Accumu-    compre-    sharehold-
                         Stock         No.       shares        No.      paid-in      lated      hensive       ers'
                         Amount      Shares      Amount      shares     capital      surplus    losses      equity
                         $'000        000's      $'000        000's      $'000        $'000      $'000      $'000
                       ----------- ----------- ----------------------------------------------------------------------
  As at January 1,
  2002                     39,861     481,817     277,386      5,979     1,014,796     23,955   (93,009)     1,262,989
  Net income                    -           -           -          -             -    179,694          -       179,694
  Foreign currency
  translation                   -           -           -          -             -          -     36,166        36,166
  Exchange of
  exchangeable shares           -         308     (4,768)      (103)         4,768          -          -             -
  Conversion of loan
  note                         22         268           -          -         1,456          -          -         1,478
  Options exercised            97       1,295           -          -         4,358          -          -         4,455
  Stock option
  compensation                  -           -           -          -         (166)          -          -         (166)
  Tax benefit
  associated with
  exercise of stock
  options                       -           -           -          -           687          -          -           687
                       ----------- ----------- -----------------------------------------------------------------------
  As at September
  30, 2002                 39,980     483,688     272,618      5,876     1,025,899    203,649   (56,843)     1,485,303
                       ----------- ----------- ----------------------------------------------------------------------
  Each exchangeable share is exchangeable into 3 common shares or one ADS.
  
  7. Contingent liabilities
  
  (i) Commitments
  
  The Company has undertaken to subscribe to interests in companies and
  partnerships for amounts totalling $37.9 million (December 31, 2001: $37.7
  million). As at September 30, 2002 an amount of $26.3 million (December 31,
  2001: $20.1 million) has been subscribed.
  
  (ii) FLUVIRAL
  
  The Company has signed a ten-year contract with the Government of Canada to
  assure a state of readiness in the case of an influenza pandemic (worldwide
  epidemic) and to provide influenza vaccine for all Canadian citizens in such an
  event. Under the contract, Shire Biologics will also supply the Government of
  Canada with a substantial proportion of its annual influenza vaccine
  requirements over the ten-year period. Subject to mutual agreement, the contract
  can be renewed for a further period of between one and ten years from 2011.
  The concept of a state of readiness against an influenza pandemic requires the
  development of sufficient infrastructure and capacity in Canada to provide 100%
  of domestic vaccine needs in the event of an influenza pandemic. Canada would
  require 32 million doses of single-strain (monovalent) flu vaccine within a
  production period of 16 weeks. Shire Biologics will therefore begin expanding
  its current production capacity in order to meet this objective within a
  five-year period.
  
  Shire Biologics is committed to Cdn$4.5 million (approximately $3.0 million) of
  capital expenditure on immoveables for the purpose of achieving the level of
  pandemic readiness required. In addition, a performance bond equal to Cdn$17.5
  million (approximately $11.5 million) has been established to ensure that in the
  event of default by Shire Biologics, adequate funds will be available to
  complete the work according to the terms of the contract.
  
  (iii) Other matters
  
  In addition, the Company is involved in claims and lawsuits in the normal course
  of business. It is not possible at this time to determine the ultimate outcome
  of any of these claims.
  ITEM 2. Management's Discussion and Analysis of Financial Condition and Results
          of Operations
  
  Results of operations for the three months ended September 30, 2002, as compared
  with those for the three months ended September 30, 2001
  
  Overview of financial results
  
  Total revenues for the three months ended September 30, 2002 increased by 18 per
  cent to $256.3 million as compared to the three months ended September 30, 2001.
  The Company recorded a third quarter net income of $63.6 million (2001: $58.1
  million).
  
  Sales and marketing
  
  Product sales of $212.0 million, which represented 83 per cent of total revenues
  for the third quarter 2002, increased by 20 per cent over third quarter 2001
  product sales of $177.3 million. Product sales in the U.S. continue to represent
  a significant percentage of our worldwide product sales, 82 per cent in the
  three months ended September 30, 2002 (2001: 85 per cent).
  
  The Company manages and controls the sales and marketing operations on
  geographic lines. The following table presents the Company's net product sales
  by individual operating segment:
  Product sales by segment                3 months to               3 months to
                                   September 30, 2002        September 30, 2001
                                                $'000                     $'000         % change
  United States                               173,532                   149,853              +16
  International                                38,509                    27,422              +40
                                         ------------              ------------     ------------
  Total product sales                         212,041                   177,275              +20
                                         ------------              ------------     ------------
  Third quarter combined sales of ADDERALL XR and ADDERALL, marketed in the U.S.
  for the treatment of Attention Deficit Hyperactivity Disorder (ADHD), were $96.1
  million, representing an increase of 11% in ADDERALL franchise sales over the
  comparative period in 2001. ADDERALL XR and ADDERALL had a 27 per cent share of
  a strongly growing prescription market for ADHD in the U.S. in September 2002
  compared to a 32 per cent in September 2001. The prescription market was 17 per
  cent larger in Q3 2002 compared to the equivalent period in 2001.
  
  ADDERALL XR recorded sales of $78.0 million in Q3 2002 and had a prescription
  market share of 21 per cent in September 2002, up from 17 per cent in June 2002
  (ADDERALL XR was not yet launched in Q3 2001). Sales for the quarter included $2
  million in respect of the launch and wholesaler stocking of a new 5mg dose. As
  anticipated, sales of ADDERALL XR reflect both the growth in scrip market share
  but also increases in wholesaler and retail pipeline levels to support the
  growing business. This impact was estimated to be minor in Q3 2002.
  
  In September 2002, ADDERALL had a market share of 6 per cent (September 2001: 32
  per cent). The decrease in ADDERALL sales during the third quarter reflects
  Shire's continued success in switching patients from ADDERALL to the once a day
  treatment (ADDERALL XR), the impact of generic competition throughout the
  quarter and further de-stocking of ADDERALL by wholesalers.
  
  Sales of AGRYLIN, for the treatment of thrombocythaemia, were $28.7 million, a
  45 per cent increase on Q3 2001 sales of $19.8 million. Sales growth in markets
  outside the U.S. grew from $3.9 million to $7.5 million. In the US, market sales
  growth of 34 per cent exceeded the scrip growth of 23 per cent during the
  quarter, due to a price increase in January 2002, and a lower Q3 2001
  comparative quarter caused by some wholesaler de-stocking following an earlier
  price increase. Shire achieved 27 per cent of the total US AGRYLIN, Hydrea and
  generic hydroxyurea prescription market in September 2002, compared to 24 per
  cent for the month of September 2001.
  
  Sales of PENTASA, licensed for the treatment of ulcerative colitis, were $21.6
  million for the third quarter 2002, 8 per cent higher than the comparable period
  last year. Sales growth was marginally above
  prescription growth due to a price increase earlier in the year. PENTASA had an
  18 per cent share of the oral mesalamine/obsalazine market in September 2002,
  consistent with September 2001.
  
  Sales of PROAMATINE, for the treatment of postural hypotension, were $14.4
  million, 62 per cent higher than third quarter 2001 sales of $8.9 million. Sales
  growth significantly exceeded scrip growth of 16 per cent due to price increases
  in January and May 2002, the launch and subsequent stocking of a new 10mg
  strength during the quarter, and a low sales base in the third quarter 2001,
  which resulted from wholesaler de-stocking. The U.S. prescription market for
  PROAMATINE and FLORINEF(TM) prescriptions indicates that PROAMATINE had a 25 per
  cent share in September 2002, consistent with September 2001.
  
  Sales of CARBATROL, containing carbamazepine for the treatment of epilepsy, were
  $10.9 million, 38 per cent higher than Q3 2001 sales of $7.9 million. Sales
  growth was 33 per cent above scrip growth due to partial re-stocking of
  wholesaler pipelines following an easing of supply constraints which have
  limited the underlying scrip growth. CARBATROL held 36 per cent of the US
  extended release carbamazepine prescription market in September 2002, compared
  to 35 per cent in September 2001.
  
  Licensing
  
  Licensing and development fees in respect of Shire Laboratories Inc (SLI) drug
  delivery contracts were $0.7 million, a decrease of $0.2 million compared to the
  three months ended September 30, 2001, resulting from the phasing of receipts
  from third parties.
  
  Royalties
  
  Royalties increased by $5.7 million in the three months ended September 30,
  2002, up 15 per cent from the three months ended September 30, 2001, to $43.5
  million.
  
  The Company receives royalties from GlaxoSmithKline on the worldwide sales of
  3TC (for the treatment of HIV infection / AIDS), and ZEFFIX (an oral treatment
  for chronic hepatitis B), with the exception of Canada where a commercialization
  partnership with GSK exists.
  
  In December 2001, Shire and GSK agreed a legal settlement with Emory University
  relating to worldwide patent disputes. Under the terms of this settlement Shire
  pays a royalty on sales of 3TC and ZEFFIX to Emory University. The 3TC and
  ZEFFIX royalties are impacted by this in the third quarter 2002 but not in the
  comparative quarter of 2001.
  
  3TC royalties for the three months ended September 30, 2002 were $32.5 million,
  an increase of 3% over the three months ended September 30, 2001. The underlying
  sales growth rate, expressed at constant exchange rates was 6%. The variance in
  royalty growth versus sales growth is due to the Emory settlement and currency
  movements.
  
  ZEFFIX royalties were $5.5 million in the third quarter 2002, an increase of 17%
  over third quarter 2001. The underlying sales growth rate expressed at constant
  exchange rates was 19%. The variance in royalty growth versus sales growth is
  due to the Emory settlement and currency movements.
  
  The Company also receives royalties from J&J on sales of REMINYL, for the
  treatment of Alzheimer's Disease.
  
  Cost of revenues
  
  Gross margin on product sales decreased slightly from 85 per cent for the three
  months ended September 30, 2001 to 84 per cent for the three months ended
  September 30, 2002, due to a slight change in sales mix.
  Research and development
  
  R&D expenditure increased 2 per cent to $42.0 million for the three months ended
  September 30, 2002 (2001: $41.3 million). R&D expenditure in third quarter 2002
  represented 16 per cent of revenues compared to 19 per cent in third quarter
  2001. The low relative spend in the quarter is related to phasing of various
  projects, including the completion of certain trials for FOSRENOL, and the
  discontinuation of Dirame.
  
  Selling, general and administrative expenses
  
  Selling, general and administrative expenses, excluding the effects of a stock
  option compensation credit of $0.01 million (2001: charge $0.05 million) and
  depreciation and amortization of $12.5 million (2001: $11.7 million), increased
  by 40 per cent to $84.5 million for the three months ended September 30, 2002
  (2001: $60.2 million). This increase reflects mainly the sustained high level of
  promotional spend associated with the ADDERALL XR launch. As a percentage of
  product sales, selling, general and administrative costs represented 40 per cent
  for the third quarter 2002 (2001: 34 per cent).
  
  Interest income and expense
  
  For the three months ended September 30, 2002, the Company received interest
  income of $5.1 million (Q3 2001: $4.6 million). Interest expense increased from
  $1.0 million to $2.3 million; primarily because the Q3 2002 expense reflects a
  full quarter of interest incurred in respect of the $400 million convertible
  notes issued in August 2001.
  
  Other income (net)
  
  Other income (net) was $0.9 million compared to a $0.2 million expense in the
  third quarter of 2001. The prior year quarter was impacted by a $1.8 million
  mark to market loss on a fully funded Supplemental Executive Retirement Plan
  (SERP), reflecting changes in US stock market conditions.
  
  Income taxes
  
  For the three months ended September 30, 2002 income taxes increased $4.2
  million to $24.0 million from $19.8 million for the three months ended September
  30, 2001. The Company's effective tax rate before the stock compensation charge
  was 27 per cent for the three months ended September 30, 2002 (Q3 2001: 25 per
  cent before stock compensation charge and exceptional items). The Company has
  recorded net deferred tax assets of $26.8 million (September 30, 2001: $23.4
  million). Realization is dependent upon generating sufficient taxable income to
  utilize such assets. Although realization on these assets is not assured,
  management believes it is more likely than not that the deferred tax assets will
  be realized.
  
  Results of operations for the nine months ended September 30, 2002, as compared
  with those for the nine months ended September 30, 2001
  
  Overview of financial results
  
  Total revenues for the nine months ended September 30, 2002 increased by 23 per
  cent to $753.6 million as compared to the nine months ended September 30, 2001.
  The Company recorded a year-to-date net income of $179.7 million (2001: net loss
  of $24.6 million after one time merger related expenses and restructuring
  charges of $177.0 million).
  
  Sales and marketing
  
  Product sales for the nine months ended September 30, 2002 of $627.7 million,
  which represented 83 per cent of total revenues, increased by 26 per cent over
  the nine months ended September 30, 2001 product sales of $497.4 million.
  Product sales in the U.S. continue to represent a significant percentage of our
  worldwide product sales, 84 per cent in the nine months ended September 30, 2002
  (2001: 84 per cent).
  The Company manages and controls the sales and marketing operations on
  geographic lines. The following table presents the Company's net product sales
  by individual operating segment:
  
  Product sales by segment          9 months to        9 months to
                                  September 30,      September 30,
                                           2002               2001
                                          $'000              $'000        % change
  
  United States                         527,005            418,305             +26
  International                         100,669             79,061             +27
                                   ------------       ------------    ------------
  Total product sales                   627,674            497,366             +26
                                   ------------       ------------    ------------
  
  Cost of revenues
  
  Gross margin on product sales increased from 83 per cent for the nine months
  ended September 30, 2001 to 85 per cent for the nine months ended September 30,
  2002. The main reason for this is that higher margin products represented a
  higher proportion of total sales.
  
  Research and development
  
  Research and development expenditure increased 15 per cent to $138.6 million for
  the nine months ended September 30, 2002 (2001: $120.8 million). R&D expenditure
  in the nine months ended September 30, 2002 represented 18 per cent of revenues
  compared to 20 per cent for the nine months ended September 30, 2001.
  
  Selling, general and administrative expenses
  
  Selling, general and administrative expenses, excluding the effects of a stock
  option compensation credit of $0.2 million (2001: charge $2.4 million) and
  depreciation and amortization of $34.9 million (2001: $33.8 million), increased
  by 40 per cent to $254.7 million for the nine months ended September 30, 2002
  (2001: $180.1 million). This primarily reflects the high promotional spend
  associated with the ADDERALL XR launch. As a percentage of product sales,
  selling, general and administrative costs represented 41 per cent for the nine
  months ended September 30, 2002 (2001: 36%).
  
  Interest income and expense
  
  For the nine months ended September 30, 2002, the Company received interest
  income of $14.7 million (2001: $14.3 million). Interest expense increased from
  $5.7 million to $6.1 million. This increase reflects a full year-to-date charge
  of interest in respect of the $400 million convertible notes issued in August
  2001, which bear interest at a fixed rate of 2% per annum. Conversion to equity
  of the $1.5 million Arenol loan note was effected in July 2002.
  
  Income taxes
  
  For the nine months ended September 30, 2002 income taxes increased $15.5
  million to $66.9 million from $51.4 million for the nine months ended September
  30, 2001. The Company's effective tax rate before the stock compensation credit
  was 27 per cent for the nine months ended September 30, 2002 (2001: 25 per
  cent). The Company has recorded net deferred tax assets of $26.8 million.
  Realization is dependent upon generating sufficient taxable income to utilize
  such assets. Although realization on these assets is not assured, management
  believes it is more likely than not that the deferred tax assets will be
  realized.
  Liquidity and Financial Condition
  
  The Company's funding requirements depend on a number of factors, including the
  Company's product development programs, business and product acquisitions, the
  level of resources required for the expansion of marketing capabilities as the
  product base expands, increased investment in accounts receivable and inventory
  which may arise as sales levels increase, competitive and technological
  developments, the timing and cost of obtaining required regulatory approvals for
  new products and the continuing revenues generated from sales of its key
  products.
  
  At September 30, 2002, the Company had net cash funds available as follows:
  
                                                September 30,         December 31,
                                                         2002                 2001
                                                        $'000                $'000
                                               --------------       --------------
  Cash and cash equivalents                           694,615              118,040
  Marketable securities and other current
    asset investments                                 268,665              723,911
  Debt                                              (408,868)            (406,806)
                                               --------------       --------------
  Net cash                                            554,412              435,145
                                               --------------       --------------
  
  Net cash provided by operating activities for the nine months ended September
  30, 2002 was $168.8 million compared to $117.3 million for the nine months ended
  September 30, 2001.
  
  Investing activities provided $400.4 million for the nine months ended September
  30, 2002 (2001: $68.0 million). This was due to an inflow of $455.1 million of
  cash by reducing funds placed on short-term deposit, and outflows in respect of
  capital expenditure on long-term investments, intangible assets and fixed assets
  of $54.8 million.
  
  Investing activities for the nine months ended September 30, 2001 included
  $109.5 million from the investment in marketable securities and reduction of
  cash placed on short-term deposit, a $53.0 million outflow in respect of capital
  expenditure on long-term investments, intangible assets and fixed assets and
  proceeds from sales of intangible fixed assets of $11.6 million.
  
  Financing activities provided $1.7 million for the nine months ended September
  30, 2002 (2001: $236.1 million). The net inflow included $4.4 million received
  from exercises of employee stock options and $2.7 million in repayments of
  long-term debt.
  
  Financing activities for the nine months ended September 30, 2001 included a
  $50.5 million inflow from exercises of employee stock options and $391.0 million
  received from the issue of convertible notes, and repayments of long-term debt
  totalling $207.0 million. The repayments were primarily in respect of a $125.0
  million term loan owing to Credit Suisse First Boston and $76.9 million repaid
  to Glaxo SmithKline. In part, cash funds released from short-term investments,
  as noted above, were used to settle the long-term debts outstanding.
  
  Capital expenditure
  
  Capital expenditure on tangible fixed assets for the nine months ended September
  30, 2002 was $11.6 million, which primarily comprised laboratory and computer
  equipment purchased across the Group.
  
  Other capital expenditure related to the purchase of long-term investments ($6.9
  million) and intangible assets ($19.2 million). The expenditure on intangible
  assets was in respect of SOLARAZE(TM), a product purchased from Skye Pharma plc
  and Bioglan Pharma plc (in administration) in May 2002 for the treatment of a
  skin condition related to excessive exposure to the sun, actinic keratosis.
  
  The Company acquired U.S. manufacturer Atlantic Pharmaceutical Services Inc for
  $17.0 million in September 2002, to provide in house manufacturing capabilities
  to support current and future activities, including the production of ADDERALL
  XR, CARBATROL and PENTASA.
  Capital expenditure on tangible fixed assets for the nine months ended September
  30, 2001 was $6.3 million, which included $1.7 million of equipment related to
  the Company's new head office facility occupied from March 2001. Expenditure was
  offset by $7.0 million in proceeds received on the disposal of the Toronto
  facility. Other capital expenditure related to the purchase of long-term
  investments ($13.2 million) and $33.5 million for new products, including
  MONOCID(TM) and INDURGAN(TM) marketed by the Company's Italian and Spanish
  operations respectively.
  
  ITEM 3.  Qualitative and Quantitative Disclosures about Market Risk
  
  Item 7A of the Group's Annual Report on Form 10-K for the year ended December
  31, 2001 contains a detailed discussion of the Group's market risk exposure in
  relation to interest rate market risk and foreign exchange market risk. There
  have been no material changes in the Group's market risk exposure since December
  31, 2001.
  
  ITEM 4. Controls and Procedures
  
  Within the 90-day period prior to the filing of this report, an evaluation was
  carried out under the supervision and with the participation of Shires'
  management, including our Chief Executive Officer and Chief Financial Officer,
  of the effectiveness of our disclosure controls and procedures (as defined in
  Rule 13a-14(c) under the Securities Exchange Act of 1934). Based upon that
  evaluation, the Chief Executive Officer and Chief Financial Officer concluded
  that these disclosure controls and procedures were effective. No significant
  changes were made in our internal controls or in other factors that could
  significantly affect these controls subsequent to the date of their evaluation.
  
  PART II.   OTHER INFORMATION
  
  ITEM 1. LEGAL PROCEEDINGS
  
  (i) General
  
  The risk of product liability claims, product recalls, litigation and associated
  adverse publicity is inherent in the testing, manufacturing, marketing and
  selling of pharmaceutical products. The cost of defending against such claims is
  expensive even when the claims are not merited. A successful product liability
  claim against us could require us to pay a substantial monetary reward. If, in
  the absence of insurance, we do not have sufficient financial resources to
  satisfy a liability resulting from such a claim or to fund the legal defence of
  such a claim, we could become insolvent. Product liability insurance coverage is
  expensive, difficult to obtain and may not be available in the future on
  acceptable terms. Although we carry product liability insurance, this coverage
  may not be adequate. In addition, we cannot be certain that insurance coverage
  for present or future products will continue to be available. Moreover, an
  adverse judgment in a products liability suit, even if insured or eventually
  overturned on appeal, could generate substantial negative publicity about our
  products and business and inhibit or prevent commercialization of other
  products.
  
  (ii) Phentermine
  
  Shire US Inc. (SUS) is a defendant in fifteen lawsuits still pending in both
  U.S. federal and state courts which seek damages for, among other things,
  personal injury arising from phentermine products supplied for the treatment of
  obesity by SUS and several other pharmaceutical companies. SUS, formerly known
  as Shire Richwood Inc., has been sued as a manufacturer and distributor of
  phentermine, an anorectic used in the short-term treatment of obesity and one of
  the products addressed by the lawsuits. The suits relate to phentermine either
  alone or together with fenfluramine or dexenfluramine. The lawsuits generally
  allege the following claims: the defendants marketed phentermine and other
  products for the treatment of obesity and misled users about the products and
  dangers associated with them; the defendants failed adequately to test
  phentermine individually and when taken in combination with the other drugs; and
  the defendants knew or should have known about the negative effects of the drugs
  and should have informed the public about such risks and/or failed to provide
  appropriate warning labels. SUS has been named as a defendant in a total of
  approximately 3,800 such phentermine lawsuits, but in all but the fifteen cases
  referenced above, SUS has been dismissed as a defendant.
  SUS became involved with phentermine through its acquisition of certain assets
  of Rexar Pharmacal Corporation (Rexar) in January 1994. In addition to SUS
  potentially incurring liability as a result of its own production of Oby-Cap, a
  phentermine product, the plaintiffs may additionally seek to impose liability on
  SUS as successor to Rexar. SUS intends vigorously to defend all the lawsuits and
  pursue all available reasonable defenses. SUS denies liability on a number of
  grounds including lack of scientific evidence that phentermine, properly
  prescribed, causes the alleged side effects and that SUS did not promote
  phentermine for long-term combined use as part of the "fen/phen" diet.
  Accordingly, SUS intends to defend vigorously any and all claims made against
  the Group in respect of phentermine and believes that liability is neither
  probable nor quantifiable at this stage of litigation. Legal expenses have been
  paid by Eon Labs Manufacturing Inc. (Eon), the supplier to SUS, or Eon's
  insurance carriers but such insurance is now exhausted. Eon has agreed to defend
  and indemnify SUS in this litigation pursuant to an agreement dated November 30,
  2000 between Eon and SUS.
  
  At the present stage of litigation, Shire is unable to estimate the level of
  future legal costs after taking into account any available product liability
  insurance and enforceable indemnities. To the extent that any legal costs are
  not covered by insurance or available indemnities, these will be expensed as
  incurred.
  
  (iii) ADDERALL
  
  Shire filed a Complaint against Barr Laboratories, Inc. on April 30, 2002 in the
  District Court of New Jersey. In the Complaint, Shire requested a preliminary
  and permanent injunction to prevent Barr from marketing a mixed amphetamine salt
  product in a trade dress similar to that of ADDERALL. Shire requested that Barr
  recall all such products and also asked for damages. An order denying the
  preliminary injunction was issued on August 26, 2002. Shire filed a Notice of
  Appeal to the United States Court of Appeals for the Third Circuit on September
  16, 2002 appealing the denial of Shire's motion for a preliminary injunction.
  
  (iv) Emory
  
  Shire BioChem was involved in worldwide patent disputes with Emory University
  (Emory) relating to lamivudine wherein Shire BioChem opposed certain patents and
  patent applications of Emory and wherein Emory opposed certain patents and
  patent applications of Shire BioChem. Pursuant to a global Settlement Agreement,
  finalized in May 2002, Emory has granted Shire and GSK an exclusive license
  under Emory's patent rights for lamivudine. The Settlement Agreement provides
  for the resolution of all worldwide patent disputes between the parties relating
  to lamivudine and FTC, including pending opposition and revocation proceedings
  in Europe, South Korea and Australia. The settlement involves a small royalty
  payment on worldwide sales of lamivudine and a license under Shire's FTC patent
  rights, in consideration for the settlement of all claims against Shire and GSK
  relating to lamivudine.
  
  Shire BioChem was also involved in worldwide patent disputes with Emory and the
  University of Georgia Research Foundation (Georgia) relating to certain
  dioxolane nucleoside analogs wherein Shire BioChem opposed certain patents and
  patent applications of Emory and Georgia and wherein Emory opposed a European
  patent of Shire BioChem. Pursuant to global Settlement and License Agreements
  finalized in August 2002 by Shire BioChem, Shire Pharmaceuticals Group, Georgia
  and Triangle Pharmaceuticals Inc. (Triangle), Shire will grant an exclusive
  royalty bearing license to Emory, sub licensable to Triangle, for certain
  dioxolane nucleoside analogs, including diamino purine dioxolane (DAPD). A low
  royalty will be payable to Shire in relation to this agreeement. Emory, Georgia
  and Triangle will grant an exclusive royalty bearing license to Shire for
  certain dioxolane nucleosides, including SPD 756. The compounds the subject of
  these licenses are in development. A low royalty will be payable by Shire upon
  commercialization of SPD 756. The Settlement and License Agreements provide for
  the resolution of all worldwide patent disputes relating to the licensed
  patents.
  
  (v) GSK
  
  On April 14, 2000, the USPTO declared an interference between BioChem's
  hepatitis B patent for lamivudine and a patent application by GSK claiming
  methods of treating hepatitis B using lamivudine. There is no guarantee that
  Shire will be successful in this interference and that Shire's patent will be
  maintained.
  (vi) Other matters
  
  In addition, the Company is involved in claims and lawsuits in the normal course
  of business. It is not possible at this time to determine the ultimate outcome
  of any of these claims.
  
  ITEM 2. CHANGES IN SECURITIES
  
  None
  
  ITEM 3. DEFAULTS UPON SENIOR SECURITIES
  
  None
  
  ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  
  None
  
  ITEM 5. OTHER INFORMATION
  
  The Audit Committee of the Board of Directors of Shire approved all non-audit
  services, including tax advisory and compliance services, provided by the
  Company's independent auditors, Deloitte and Touche, during the period covered
  by this report.
  
  ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K
  
  (a)      Exhibits
  
           None
  
  (b)      Reports on Form 8-K
  
           During the third quarter ended September 30, 2002, the following
           reports on Form 8-K were filed by the Company with the Securities and
           Exchange Commission:
  
           Form 8-K (Item 5 - Other Events, and Item 7 - Financial Statements and
           Exhibits), date of earliest event reported September 26, 2002, with
           respect to the issue of a press release announcing the 2002 Research &
           Development briefing.
  Form 8-K (Item 5 - Other Events, and Item 7 - Financial Statements and
           Exhibits), date of earliest event reported September 25, 2002, with
           respect to the issue of a press release announcing holdings by FMR Corp
           and Fidelity International Limited in the ordinary share capital of the
           Company, and to the issue of a press release announcing holdings by
           Franklin Resources Inc. in the ordinary share capital of the Company.
  
           Form 8-K (Item 5 - Other Events, and Item 7 - Financial Statements and
           Exhibits), date of earliest event reported September 24, 2002, with
           respect to the issue of a press release announcing the granting of
           share options to directors of the Company, pursuant to the Shire
           Pharmaceuticals Sharesave Scheme.
  
           Form 8-K (Item 5 - Other Events, and Item 7 - Financial Statements and
           Exhibits), date of earliest event reported September 20, 2002, with
           respect to the issue of a press release giving notice of the 2002
           Research & Development briefings.
  Form 8-K (Item 5 - Other Events, and Item 7 - Financial Statements and
           Exhibits), date of earliest event reported September 16, 2002, with
           respect to the issue of a press release announcing an update on
           FOSRENOL.
  
           Form 8-K (Item 4 - Changes in the Registrant's Certifying Accountant),
           on July 31, 2002 Arthur Andersen informed Shire Pharmaceuticals Group
           plc (the Registrant) that it would no longer be able to serve as the
           Registrant's independent auditors and submitted its letter of
           resignation. The Registrant subsequently engaged the services of
           Deloitte & Touche effective July 31, 2002.
  
  SIGNATURES
  
  Pursuant to the requirements of the Securities Exchange Act of 1934, the
  Registrant has duly caused this Report to be signed on its behalf by the
  undersigned thereunto duly authorized.
  
  SHIRE PHARMACEUTICALS GROUP PLC
  (Registrant)
  
  Date:    November 14, 2002      By:      Angus C Russell
                                           Group Finance Director
  
                                           /s/ Angus C Russell
  
  Date:    November 14, 2002      By:      Rolf Stahel
                                           Chief Executive
  
                                           /s/ Rolf Stahel
  CERTIFICATIONS
  
            CERTIFICATION OF THE PRINCIPAL FINANCIAL OFFICER PURSUANT TO
                    SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
  
  I, Angus C Russell, certify that:
  
  1.   I have reviewed this quarterly report on Form 10-Q of Shire Pharmaceuticals
       Group plc (the Registrant);
  
  2.   Based on my knowledge, this quarterly report does not contain any untrue
       statement of a material fact or omit to state a material fact necessary to
       make the statements made, in light of the circumstances under which such
       statements were made, not misleading with respect to the period covered by
       this quarterly report;
  
  3.   Based on my knowledge, the financial statements, and other financial
       information included in this quarterly report, fairly present in all
       material respects the financial condition, results of operations and cash
       flows of the registrant as of, and for, the periods presented in this
       quarterly report;
  
  4.   The registrant's other certifying officers and I are responsible for
       establishing and maintaining disclosure controls and procedures (as defined
       in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
  
       a)   designed such disclosure controls and procedures to ensure that
            material information relating to the registrant, including its
            consolidated subsidiaries, is made known to us by others within those
            entities, particularly during the period in which this quarterly
            report is being prepared;
  
       b)   evaluated the effectiveness of the registrant's disclosure controls
            and procedures as of a date within 90 days prior to the filing date of
            this quarterly report (the "Evaluation Date"); and
  
       c)   presented in this quarterly report our conclusions about the
            effectiveness of the disclosure controls and procedures based on our
            evaluation as of the Evaluation Date;
  
  5.   The registrant's other certifying officers and I have disclosed, based on
       our most recent evaluation, to the registrant's auditors and the audit
       committee of registrant's board of directors (or persons performing the
       equivalent function):
  
       a)   all significant deficiencies in the design or operation of internal
            controls which could adversely affect the registrant's ability to
            record, process, summarize and report financial data and have
            identified for the registrant's auditors any material weaknesses in
            internal controls; and
  
       b)   any fraud, whether or not material, that involves management or other
            employees who have a significant role in the registrant's internal
            controls; and
  
  6.   The registrant's other certifying officers and I have indicated in this
       quarterly report whether or not there were significant changes in internal
       controls or in other factors that could significantly affect internal
       controls subsequent to the date of our most recent evaluation, including
       any corrective actions with regard to significant deficiencies and material
       weaknesses.
  
  Date: November 14, 2002
  
  /s/ Angus C Russell
  ------------------------
  Angus C Russell
  Group Finance Director
  CERTIFICATION OF THE PRINCIPAL EXECUTIVE OFFICER PURSUANT TO
                    SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
  
  I, Rolf Stahel, certify that:
  
  1.   I have reviewed this quarterly report on Form 10-Q of Shire Pharmaceuticals
       Group plc (the Registrant);
  
  2.   Based on my knowledge, this quarterly report does not contain any untrue
       statement of a material fact or omit to state a material fact necessary to
       make the statements made, in light of the circumstances under which such
       statements were made, not misleading with respect to the period covered by
       this quarterly report;
  
  3.   Based on my knowledge, the financial statements, and other financial
       information included in this quarterly report, fairly present in all
       material respects the financial condition, results of operations and cash
       flows of the registrant as of, and for, the periods presented in this
       quarterly report;
  
  4.   The registrant's other certifying officers and I are responsible for
       establishing and maintaining disclosure controls and procedures (as defined
       in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
  
       a)   designed such disclosure controls and procedures to ensure that
            material information relating to the registrant, including its
            consolidated subsidiaries, is made known to us by others within those
            entities, particularly during the period in which this quarterly
            report is being prepared;
  
       b)   evaluated the effectiveness of the registrant's disclosure controls
            and procedures as of a date within 90 days prior to the filing date of
            this quarterly report (the "Evaluation Date"); and
  
       c)   presented in this quarterly report our conclusions about the
            effectiveness of the disclosure controls and procedures based on our
            evaluation as of the Evaluation Date;
  
  5.   The registrant's other certifying officers and I have disclosed, based on
       our most recent evaluation, to the registrant's auditors and the audit
       committee of registrant's board of directors (or persons performing the
       equivalent function):
  
       a)   all significant deficiencies in the design or operation of internal
            controls which could adversely affect the registrant's ability to
            record, process, summarize and report financial data and have
            identified for the registrant's auditors any material weaknesses in
            internal controls; and
  
       b)   any fraud, whether or not material, that involves management or other
            employees who have a significant role in the registrant's internal
            controls; and
  
  6.   The registrant's other certifying officers and I have indicated in this
       quarterly report whether or not there were significant changes in internal
       controls or in other factors that could significantly affect internal
       controls subsequent to the date of our most recent evaluation, including
       any corrective actions with regard to significant deficiencies and material
       weaknesses.
  
  Date: November 14, 2002
  
  /s/ Rolf Stahel
  ------------------------
  Rolf Stahel
  Chief Executive
  Certification
                            Accompanying Form 10-Q Report
                         of Shire Pharmaceuticals Group plc
              Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
                  (Chapter 63, Title 18 U.S.C. ss.1350(a) and (b))
  
       Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chapter 63,
  Title 18 U.S.C. ss.1350(a) and (b)), each of the undersigned hereby certifies
  that, to the best of their knowledge and belief, the Quarterly Report on Form
  10-Q for the period ended September 30, 2002 of Shire Pharmaceuticals Group plc
  ("Company") fully complies with the requirements of Section 13(a) or Section
  15(d) of the Securities Exchange Act of 1934 and that the information contained
  in such Report fairly presents, in all material respects, the financial
  condition and results of operations of the Company.
  
  Dated:  November 14, 2002               /s/ Rolf Stahel
                                          --------------------------------
                                          Rolf Stahel
                                          Chief Executive
                                          Shire Pharmaceuticals Group plc
  
  Dated:  November 14, 2002               /s/ Angus C Russell
                                          --------------------------------
                                          Angus C. Russell
                                          Group Finance Director
                                          Shire Pharmaceuticals Group plc