AstraZeneca still playing catch up in I/O
- AstraZeneca is still smarting from the impact of July 2016 U.S. launches of generic forms of Crestor (rosuvastatin), causing its year to start on a weak note – the first quarter's revenue, at $5.4 billion, was down 10% year-on-year, and the core EPS fell by 2%. (All earnings reported on a constant exchange rate basis.)
- The company was positive about its growth platforms though – emerging markets, respiratory disease, new cardiovascular and metabolic disease, Japan and new oncology – up overall by 5%, and making up 66% of the company's revenue. However, declines in U.S. sales of Symbicort (budesonide/formoterol fumarate dihydrate) meant flat growth in the respiratory group, dragging the overall percentage down.
- Guidance for 2017 isn't looking much more cheerful, with a low- to mid-single digit decline for total revenue, and a low- to mid-teens percentage decline in core earnings per share, increasing the emphasis on the handful of regulatory decisions expected in 2017.
AstraZeneca's first quarter earnings showed a slow but not sensational growth in what it describes as its key growth drivers – new cardiovascular and metabolic diseases, new oncology, respiratory and emerging markets – against the declining income of its patent-expired blockbusters Crestor (rosuvastatin), Nexium (esomeprazole) and Seroquel (quetiapine).
CEO Pascal Soriot, who has promised the company would reach $45 billion revenues by 2023, described the quarter as a strong one. "We are reaching the end of the impact of this large wave of patent expiries. We are looking forward to the next wave of launches from our growth platforms, which could bring us back to growth," he said on the call, expressing optimism for reaching those lofty goals.
AstraZeneca's new oncology platform had sales of $236 million in the first quarter of 2017. The British pharma has been selling off assets over the last several months and reallocating resources to its oncology assets — five of the six new drugs that it hopes will drive sales are in this space.
AstraZeneca's immuno-oncology therapy durvalumab is waiting for news on its bladder cancer submission in the U.S., but it's well behind the curve compared with its competitors Merck & Co., Roche and Bristol-Myers Squibb. Durvalumab is working its way through the MYSTIC and ARTIC trials alone or with tremelimumab in non-small cell lung cancer, with data readouts expected mid-2017 and regulatory submission planned for the second half of the year.
The POSEIDON study, which looks at the idea of comparing durvalumab monotherapy, or durvalumab and tremelimumab with chemotherapy, is currently recruiting. Analysts on the first quarter earnings call Thursday morning wondered if this trial could serve as an insurance policy of sorts for the combination therapy data after AstraZeneca had to restructure its other late-stage MYSTIC trial in favor of the monotherapy.
"We haven't lost confidence in MYSTIC; we are giving physicians the data so that they can choose between treating patients with chemotherapy as well as immuno-oncology drugs, for example in patients who require tumor shrinkage, allowing time for the immuno-oncology approach to work. This is a pragmatic decision as many physicians will see a place for chemotherapy in non-small cell lung cancer as well as immunotherapy," Chief Medical Officer Sean Bohen said.
"The combination of immuno-oncology and chemotherapy was part of the strategy from day one; this is not a knee jerk response," Soriot added.
- AstraZeneca Statement
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