AstraZeneca Profit Climbs on Cancer Drugs Before Key Trial Results

AstraZeneca Plc profit rose in the first quarter, helped by sales of its blockbuster oncology treatments, as the company looks to key trial readouts this year to reinforce its position as a top producer of cancer therapies.

(Bloomberg) — AstraZeneca Plc profit rose in the first quarter, helped by sales of its blockbuster oncology treatments, as the company looks to key trial readouts this year to reinforce its position as a top producer of cancer therapies.

The UK drugmaker reported earnings per share, excluding some costs, of $1.92 for the three months through March, according to a statement Thursday, more than the $1.68 analysts estimated. Sales also topped expectations.

Astra is planning to start 30 advanced stage trials this year, with six already up and running in the first quarter. The company is maintaining its 2023 guidance because of the investment needed for so many trials, despite a strong first quarter, Chief Financial Officer Aradhana Sarin said in an interview with Bloomberg TV Thursday. A lot of those “costs will be back-end weighted, so we’re sticking with our guidance for the year,” said Sarin.

Astra shares rose as much as 2.5% in early London trading.

Led by Chief Executive Officer Pascal Soriot, Astra’s turnaround over the last decade has largely rested on its oncology portfolio, powered by drugs Tagrisso, Imfinzi, and Lynparza. The company is awaiting trial results this year to boost that position further, including a potentially game-changing readout for its lung cancer drug datopotamab deruxtecan that could overtake standard chemotherapy as a treatment option.

Other important results pending include a head-to-head study from rival Johnson & Johnson comparing its lung cancer drug rybrevant with Astra’s blockbuster product Tagrisso, which could be positive for the UK pharmaceutical giant.

What Bloomberg Intelligence Says:

AstraZeneca’s reiterated full-year guidance looks conservative to us in light of its 1Q 3% sales and 14% adjusted EPS beat, together with $718 million income from the recent nirsevimab contract renegotiation to follow in 2Q. $241 million income from the divestment of Pulmicort Flexhaler’s US rights was a key driver of the beat, which also included a near-4% year-over-year gross-margin boost.

— John Murphy, BI pharma analyst

AstraZeneca Beats; Reiterated Guidance Looks Conservative: React

The performance in the first quarter came after a falloff in sales from Covid-19-related products — a revenue stream that’s expected to decline significantly in 2023, Astra said. Still, a rebound in diagnosis and treatment rates following the pandemic boosted demand for some of its cancer drugs.

–With assistance from Anna Edwards.

(Updates with comments from Astra CFO on Bloomberg TV in third paragraph, BI analyst)

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