Daily Management Review

AstraZeneca Raises Its Revenue Forecast On COVID Therapy


AstraZeneca Raises Its Revenue Forecast On COVID Therapy
After reporting a second-quarter profit that exceeded analyst estimates, AstraZeneca said it expects prescriptions for its Evusheld injectable to defend against COVID-19 to drive sales growth of more than 20 per cent.
The London-listed company raised its full-year sales outlook, predicting it will expand by a percentage in the "low twenties" rather than the "high teens" originally projected.
It maintained its expectation for an increase in adjusted earnings per share in the "mid-to-high twenties per cent," owing in part to a larger budget for pharmacological research and development as well as marketing and distribution of Evusheld.
Analysts at Jefferies and JPMorgan said the earnings outlook was unlikely to excite investors, and its shares sank 2.5 per cent at 0735 GMT, trailing the STOXX Europe 600 Health Care index, which declined 0.4 per cent.
Second-quarter adjusted earnings nearly doubled to $1.72 cents per share for the three months ended June 30, on revenue of around $10.8 billion, a 31 per cent increase. According to Refinitiv statistics, analysts predicted a profit of $1.56 cents per share on revenue of roughly $10.5 billion.
On Friday, the business also announced the replacement for non-executive Chairman Leif Johansson, who will step down when he retires next year. Demaré is the current chair of AstraZeneca's pay committee.
Johansson was appointed chairman in 2012, about the same time as Frenchman Pascal Soriot was appointed CEO.
Soriot, who turned down a buyout bid from Pfizer in 2014, is effectively out as a chairman candidate.
Michel Demaré, former chairman of Syngenta, spearheaded the Swiss agricultural chemicals maker's successful defence against an unwanted takeover bid by US rival Monsanto in 2015, which ended in the approved acquisition of Syngenta by ChemChina.
AstraZeneca expects rising sales of Evusheld, an antibody-based COVID-19 treatment for people with weakened immune systems, to offset a drop in sales of its vaccine Vaxzevria, developed in collaboration with Oxford University, in the face of increased competition.
Previously, the business anticipated that Evusheld growth would not compensate for the drop in Vaxzevria sales.
Astra's best-selling lung cancer therapy Tagrisso saw quarterly revenues climb by 7 per cent to $1.4 billion, while sales of cardiovascular and diabetes treatment Farxiga increased by 51 per cent to $1.1 billion, both slightly ahead of market estimates.