AstraZeneca Plc said earnings are being boosted by demand for drugs like Farxiga for diabetes and Tagrisso for cancer, showing that Chief Executive Officer Pascal Soriot’s efforts to rejuvenate its pipeline of treatments are paying off.
(Bloomberg) — AstraZeneca Plc said earnings are being boosted by demand for drugs like Farxiga for diabetes and Tagrisso for cancer, showing that Chief Executive Officer Pascal Soriot’s efforts to rejuvenate its pipeline of treatments are paying off.
Core earnings per share will probably rise by a high single-digit to low double-digit percentage, the UK drugmaker said Thursday, roughly in line with what analysts anticipated. Profit in the fourth quarter beat estimates. The stock rose as much as 2.9% in London trading.
Soriot is reaping the benefits of a risky bet on cancer to transform the drugmaker’s once meager pipeline. Astra is scheduled to report results from some key clinical trials this year, including one for a lung cancer treatment that could generate billions of dollars in sales.
Soriot, speaking in a Bloomberg Television interview, said he anticipates “another good year for us ahead,” even though it will be challenging for the economy.
“The innovation narrative remains strong,” Mark Purcell, an analyst at Morgan Stanley, wrote in a note to clients, saying the company plans to start more than 30 key trials this year, with 10 that have the potential to deliver peak sales of more than $1 billion.
The rejuvenation effort has weighed on costs. Research and development spending is swelling as Astra pushes ahead with clinical trials, even as it introduces new medicines such as Airsupra and Tezspire for asthma and Saphnelo for lupus.
Soriot’s Future
Soriot has made cancer a priority, establishing a collaboration with Daiichi Sankyo Co. that’s already yielded one possible future blockbuster, the breast cancer drug Enhertu.
Trial results for another promising treatment from the joint effort called datopotamab deruxtecan, or Dato-DXd, are due soon. The drug has the potential to replace chemotherapy in lung cancer, Soriot said in the interview.
Read More: AstraZeneca Looks to More Than Double New Cancer Drugs by 2030
Soriot, who has been at the helm for more than a decade, said the company has a “robust” succession plan but he won’t be leaving anytime soon. The 63-year-old executive joined from Switzerland’s Roche Holding AG in the last quarter of 2012. Roche’s own CEO will ceding his place next month after 15 years at the helm, moving on to become chairman.
“I still feel very fine and very fit and I love what I do,” Soriot said. “I’m still here for a little while.”
Earnings per share were $1.38 in the fourth quarter, beating the average analyst estimate of $1.35. Revenue from Covid-19 medicines will probably decline significantly this year.
–With assistance from Anna Edwards and Mark Cudmore.
(Updates with shares in fourth paragraph)
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