This article has been adapted from our sister site across the pond, Fool UK.

Many a long-term investor likes to have a dividend-paying pharmaceutical company tucked away in their portfolio, in order to benefit from regular income plus expected long-term price growth.

However, the big two quoted on the London Stock Exchange, GlaxoSmithKline (NYSE: GSK) and AstraZeneca (NYSE: AZN), have seen their shares falling out of favor of late, as people are afraid that their drug development pipelines might be drying up and that they're facing increasing competition from generic drugs and pricing pressures from European governments.

In fact, Glaxo only last week recorded falling profits for 2010, not long after AstraZeneca reported mixed results. Forecasts for 2011 put both companies on prospective dividend yields of over 5.5%. The two are on prospective P/E ratios of around 10 and 7, respectively.

A different ball game
By contrast, Shire Pharmaceuticals (Nasdaq: SHPGY), which reported full-year results for 2010 on Thursday, could hardly be a more different beast. Shire, which develops specialty drugs, pays a tiny dividend of only around the 0.5% mark, and its shares are on a prospective P/E of more than 15.

Shire has an impressive pipeline of drugs under development for the treatment of all kinds of tricky conditions, including ADHD, depressive disorders, digestive conditions, and others, and is also researching a number of genetic therapies. And that is the key to the difference -- investors are heaping a large helping of blue-sky thinking onto their purchase decisions, and the current share price reflects hopes for some dramatic and innovative breakthrough products over the next few years.

But what of the 2010 results? Well, we saw a 17% increase in full-year net profit over 2009, from a 16% growth in revenues. That was in a year which saw Shire take over the Belgian pharmaceutical firm Movetis, and the treatments for rare conditions that came as part of that acquisition are expected to boost Shire's revenue next year with the company forecasting a 16% increase in 2011 sales.

Part of that forecast growth is expected to come from pipeline advances, but Shire has apparently also identified some possible takeover targets for the coming year.

Sales, profits, and cash flow all up
Total sales for the year rose to $3.1 billion, up from $2.7 billion the year before, with profit net of tax growing from $504 million to $588 million. A full-year dividend of 13.1 cents per share was announced, which is a 15% rise on last year -- though it's still only small change.

Free cash flow for the year grew from $386 million to $795 million, and even after using it for expansion, including the Movetis takeover, Shire was still able to cut its year-end net debt figure by $84 million to $531 million. Debt really isn't a problem for Shire, but it's nice to see it falling all the same.

Part of 2010's success came from Shire's slow-release hyperactivity drug Vyvanse, sales of which climbed 26% to $634 million and accounted for 18% of the company's total revenues for the year.

More of the same to come?
Telling us that 2010 was an "outstanding year" for the company, Shire's chief executive, Angus Russell, went on to say:

With a young and balanced portfolio and a strong pipeline, we look forward to continuing this success as we build on the strength of our business model and plan for further good growth in the year ahead. We're increasingly confident about achieving our aspirational growth targets and continuing to have a positive impact on patients' lives.

So, is Shire the kind of company you think will take over as an investors' favorite from its bigger rivals? Or do you prefer the high-dividend approach? Or is there room for both in your portfolio? Please do let us know, below.

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Alan doesn't own any shares mentioned. GlaxoSmithKline is a  Motley Fool Global Gains  selection. The Fool owns shares of GlaxoSmithKline and has a disclosure policy.