More changes at the top as AstraZeneca profits slip
pharmafile | November 1, 2013 | News story | Sales and Marketing | AstraZeneca, Crestor, Q3, profits
AstraZeneca’s third quarter revenues and profits fell below analysts’ expectations yesterday, but mitigated the news with the appointment of a new chief financial officer and a big patent victory in the US.
AZ’s revenues fell 4% to $6.25 billion – around $200 million below consensus forecasts – while operating profit plummeted 29 per cent.
It lost around $350 million of revenues to generic competition, with cholesterol blockbuster Crestor (atorvastatin) sliding 11% to $1.36 billion in the quarter and gastrointestinal drug Nexium (esomeprazole) down 5% to $918 million.
“As expected, our financial performance this year reflects the ongoing impact from the loss of exclusivity for several key brands,” said chief executive Pascal Soriot.
On the plus side, there were gains for AZ in Japan, its diabetes and respiratory franchises and cardiovascular product Brilinta (ticagrelor), which combined to post an 8% sales increase.
Sales growth in China was particularly encouraging, rising 13% to $467 million which was a drop on earlier growth rates – blamed on inventory destocking – but well ahead of many of its big pharma peers.
There was a mixed bag of news accompanying the financial statements. Topping the list was the appointment of recently hired executive vice president Marc Dunoyer as AZ’s new CFO to replace Simon Lowth, who left in the summer.
There was also a victory on appeal in a US patent dispute focussing on the firm’s asthma drug Pulmicort Respules (budesonide), which could block generic competition for three to 12 months and possibly even until 2019. Sales of the later product were $622 million in the first nine months of this year.
On the other hand, it has emerged that AZ is being investigated by the US Department of Justice (DoJ) over a pivotal clinical trial for Brilinta, which was launched in 2011 but has failed to gain much sales momentum.
The nature of the investigation is not yet clear, but the news increased nervousness about the potential of the heart attack-preventing drug, which posted sales of $79 million in the quarter.
Despite being three times higher than the third quarter of 2012, the performance of the product is described by analysts at Panmure Gordon as ‘moribund’, and AZ is investing heavily in marketing and an additional large-scale trial called PEGASUS to try to lift uptake of the drug.
On balance, investors were swayed by the negative news coming out of the company and AZ shares fell around 1.5% on the day.
Panmure Gordon welcomed the appointment of Dunoyer as a more strategic finance director than his ‘more technocratic predecessor’, noting that “this is probably what the company needs at this stage”.
Phil Taylor
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