IT problems at Swedish plant affect AstraZeneca
pharmafile | July 27, 2012 | News story | Manufacturing and Production | AstraZeneca, Nexium, Symbicort, financials
Software problems at a manufacturing facility operated by AstraZeneca in Sweden are having a material impact on the business, pegging back second-quarter revenues, according to the company’s interim chief executive Simon Lowth.
“Our best estimate of the impact in the second quarter is around 2% of revenue overall, but … supply issues reduced our growth rate in emerging markets from around 8% down to 1 per cent,” Lowth told analysts yesterday.
The interruptions were caused by problems associated with the implementation of new enterprise resource planning (ERP) systems at the Södartälje plant towards the end of the first quarter, which held up production and cost the company around $60 million in lost revenues in the first quarter, rising somewhat in the second.
Production is now well ahead of normal levels, however, and is responding to ongoing demand, including filling back orders and restoring normal inventories in the distribution channels, he said.
The brands affected mostly by the disruption were asthma and chronic obstructive pulmonary disease (COPD) treatment Symbicort (budesonide/formoterol), gastrointestinal treatment Nexium (esomeprazole) and cardiovascular Atacand (candesartan cilexetil), according to AZ’s executive vice president for global commercial, Tony Zook, although he noted some other lines were also impacted.
Lowth stressed there should be no lasting damage to brands because AZ is “responding to demand, replenishing, supply chain inventories [and has] been very focused on meeting patient needs”.
Overall, AZ estimates the revenue impact for the full year to be around 1 per cent. The company reported revenues down 18% at constant exchange rates to $6.66 billion yesterday, thanks mainly to generic competition to some of its key brands and divested operations.
Phil Taylor
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