AstraZeneca Q2 results beat estimates; COVID vaccine sales evaporate

AstraZeneca on Friday delivered better-than-expected profits and sales in the second quarter as a strong performance of its blockbuster cancer drugs helped offset the loss of COVID-19 vaccine sales.

The Anglo-Swedish drugmaker posted an adjusted profit of $2.15 per share, up 25% and exceeding the $1.98 per share expected in company-compiled consensus estimates.

Total revenue in the quarter was $11.4 billion, up 6% and beating company-compiled analyst estimates of $10.97 billion.

Shares were up 3.1% in early trading, among the top gainers on London’s blue-chip FTSE stock index.

The strong results add to a string of strong quarters for the UK’s biggest company by market capitalisation worth more than 165 billion pounds ($211 billion), bolstered by a strong pipeline of drugs.

Even so, the company registered no sales of its COVID-19 vaccine, its best-selling product in 2021 at the height of the pandemic, compared with $445 million a year ago, and said it expects sales to decline significantly in the full year.

The rapid decline of the COVID business for one of the first drugmakers to develop a shot against the virus in 2020 highlights the challenge in competing with rival vaccines manufactured by Pfizer (NYSE:PFE) and Moderna (NASDAQ:MRNA).

“Each of our non-COVID-19 therapy areas saw double-digit revenue growth, with eight medicines delivering more than $1bn of revenue in the first half, demonstrating the strength of our business,” Chief Executive Pascal Soriot said.

Excluding COVID medicines, sales in China grew by 7% at constant exchange rates in the quarter, the fourth consecutive quarter of growth on that basis.

The company upgraded its guidance for China, saying it expected total revenue to grow by a low-to-mid single digit percentage in 2023, up from a low single-digit percentage increase.

AstraZeneca (NASDAQ:AZN) is the largest drugmaker in China, which accounted for 13% of last year’s revenue.

The results come after interim data released earlier this month on an experimental precision drug called datopotamab deruxtecan, which disappointed investors.

The company said on Friday it will continue with its plan to file data from the trial with the U.S. drug regulator, soothing some investor concerns.

Markus Manns, a senior portfolio manager at Union Investment and AstraZeneca shareholder, said that “should increase investor confidence in the product”, after underwhelming interim data.

AstraZeneca stood by its 2023 outlook.

Separately, the company said on Friday its unit Alexion (NASDAQ:ALXN) has agreed to buy U.S. drugmaker Pfizer’s early-stage rare disease gene therapy portfolio for up to $1 billion, plus royalties on sales to bolster its genomic medicine capabilities.

($1 = 0.7816 pounds)