Anglo-Swedish drug maker AstraZeneca Plc (AZN, AZN.L) Wednesday reported a 36 percent decline in pre-tax profit for the first quarter, hit by loss of exclusivity for several large products. The company, however, backed its full year view.
Pascal Soriot, CEO, said, "As anticipated, the first quarter performance reflects the loss of exclusivity for several large products. We remain focused on our strategic priorities of returning to growth and achieving scientific leadership. Brilinta, the diabetes franchise, Emerging Markets, Japan and our Respiratory products have all made good progress."
Faced with stiff competition from generic drugs, the drugmaker last month announced thousands of headcount reductions in its SG&A activities globally and revealed its strategy to return to growth. AstraZeneca also decided to focus mainly in its research and development efforts and continue to be active in Infection & Vaccines and in Neuroscience.
Pre-tax profit fell 36 percent to $1.30 billion from $2.04 billion. Prior-year results have been restated.
Core pre-tax profit, a non-GAAP measure, was 25 percent lower at $2.23 billion.
Profit attributable to owners of the parent declined to $1.01 billion from $1.63 billion reported a year back. Earnings per $0.25 ordinary share dropped to $0.81 from $1.27 in the earlier year period.
Revenue dropped 13 percent to $6.39 billion from $7.35 billion, amid losses of exclusivity for neuroscience product Seroquel IR and cardiovascular drug Atacand in many markets, and for Crestor in Canada. On a currency-neutral basis, revenue dropped 12 percent.
AstraZeneca said the impact from losses of exclusivity totaled over $1 billion in the quarter.
Product-wise, revenue generated by cardiovascular drug Crestor dropped 11 percent to $1.32 billion. Product revenue comparisons are on a currency neutral basis.
In the neuroscience category, Seroquel sales dropped 60 percent to $449 million and Seroquel IR sales were 82 percent lower at $127 million.
US revenues declined 16 percent to $2.445 billion and revenue fell 15 percent to $1.66 billion in Europe, largely due to the loss of exclusivity for Seroquel IR.
Revenue from Emerging Markets increased 9 percent at constant exchange rates in the quarter, largely driven by a 21 percent increase in China.
For the full year, the company still expects a mid-to-high single digit decline in revenue at CER and a core earnings per share decline that is significantly larger than the annual revenue decline.
AZN.L is currently trading down 2.55 percent at 3,303.50 pence.
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