AstraZeneca has posted dismal performance during the first quarter ended March 2014 and its net profit declined sharply by 36.4 per cent to $506 million from $1,012 million in the similar quarter of last year due to loss on disposal of Alderley Park and the impact of the acquisition of the global diabetes alliance. Its net sales improved marginally by 0.5 per cent to $6,416 million from $6,385 million. EPS declined to $0.40 from $0.81 in the last period.
The key growth platforms Brilinta, diabetes, respiratory, emerging markets and Japan delivered $3.3 billion of revenue in the first quarter. Emerging markets grew by 11 per cent with revenue in China increasing by 22 per cent. Its US sales increased by 3 per cent to $2,513 million and its sales in Europe declined by 1.4 per cent to $1,637 million due to loss of exclusivity on Seroque IR, Seroquel XR in some market. R&D expenditure declined to $1,200 million from $1,259 million.
Pascal Soriot, CEO, commenting on the results, said, “The first quarter has seen continued momentum across the business and our revenue growth reflects the increasing contribution from the five growth platforms that showed strong performance.”
“I am pleased with the significant progress we are making towards achieving scientific leadership in our core therapeutic areas. We have confirmed our decision to advance four programmes to phase III in oncology and respiratory disease. The breakthrough therapy designation for AZD9291 in non-small cell lung cancer and the Priority Review granted for olaparib in ovarian cancer by the FDA act as a reminder of the distinctive science that AstraZeneca can bring to patients.”
“We are investing in our rapidly progressing pipeline and the key platforms that are the backbone of our strategy to return to growth. To further concentrate organisational focus, we will continue to redeploy our resources in our core priorities and pursue opportunities that maximise the value of our pipeline and portfolio,” he added.
The AstraZeneca pipeline continues to grow and now includes 104 projects, of which 90 are in the clinical phase of development. During Q12014, across the portfolio, 4 projects were approved and 7 projects have successfully progressed to their next phase (including 1 project entering first human testing).
In conjunction with the full year 2013 results, the company announced that it anticipates 4 to 5 additional new molecular entity (NME) phase III starts in 2014. The late stage pipeline now includes 11 NMEs in phase III or under regulatory review. Myalept (metreleptin) gained regulatory approval from the US FDA in the first quarter.
On 1 February 2014, AstraZeneca completed the acquisition of BMS’s interests in the companies’ diabetes alliance. The acquisition provides AstraZeneca with 100 per cent ownership of the intellectual property and global rights for the development, manufacture and commercialisation of the diabetes business, which includes Onglyza (saxagliptin), Kombiglyze XR (saxagliptin and metformin HCl extended release), Komboglyze (saxagliptin and metformin HCl), Farxiga (dapagliflozin, marketed as Forxiga outside the US), Xigduo (dapagliflozin and metformin Hcl), Byetta (exenatide), Bydureon (exenatide extended release for injectable suspension), Myalept (metreleptin) and Symlin (pramlintide acetate).
Upfront consideration for the acquisition of $2.7 billion was paid on February1, 2014, with further payments of up to $1.4 billion being payable for future regulatory, launch and sales -related milestones. AstraZeneca has also agreed to pay various sales -related royalty payments up until 2025.