PASCAL Soriot today launched an impassioned defence of AstraZeneca’s role in the fight against the pandemic as his FTSE100 drug-maker reported a leap in quarterly sales to more than $7billion (£5.25billion).
One year after signing a not-for-profit deal to manufacture and distribute Oxford University’s Covid-19 shot, the Anglo-Swedish giant has supplied 300 million doses to more than 165 countries. Soriot called that: “a remarkable achievement.”
Despite this, the group is now being sued by the European Commission over its supplies to the bloc and countries, including the UK, are considering imposing age restrictions following reports of blood clot side-effects in a tiny fraction of patients.
Soriot said: “We got involved because we wanted to help, we thought we could make a difference. We never pretended we would be perfect, and we’ve certainly learned a few things along the way.. but imagine if we had not stepped up.
“A year ago people were talking about there being 120, 130 different vaccines. Where are they all? Nowhere, simply because there was no manufacturing capacity to make them.
“I don’t think we overpromised, we never promised more than we thought we could deliver but in hindsight everybody is very wise.
“We don’t regret anything because we look forward, not backward. We did our very best to help the world, and overall the team should be very proud of the difference we’ve made and lives we’ve saved.
“We are proud of what we have done, and only disappointed we could not do even more.”
Soriot spoke out as AZ reported a sales increase of 11% to $7.3billion (£5.25bn) in the first three months of 2021, making “solid progress” despite the pandemic’s drag on the diagnosis and treatment of other health conditions.
Revenue and profits were both above analyst forecasts, with sales of the vaccine shots contributing $275million (£200m) to the total.
Stripping out the jab, sales were up 7% to $7bn driven by sales of cancer drugs and growth in emerging markets particularly China, up 19%.
Core earnings per share, its preferred measure, were up 55% to $1.63, against concensus expectations of $1.48.
Overall, the gross profit margin fell 3% to 74.3% because the vaccine is being sold on a non-profit basis.
Shares were up 3.2% this morning, hitting 7640p.
Since taking the helm at AZ in 2012, CEO Pascal Soriot has focused on transforming the group through its research-led pipeline of new drugs.
Today’s results show research investment was up 18% to $1.6billion, while the group’s surprise $39bn bid for drugs maker Alexion - a move which initially rocked its share price - is on track to complete later this year.
Soriot hailed: “another quarter of strong revenue and earnings progression, continued profitability, and cash-flow generation, despite the pandemic’s ongoing negative impact on the diagnosis and treatment of many conditions.
“We expect the impact of COVID to reduce and anticipate a performance acceleration in the second half of 2021."
Sales of blockbuster Lynparzaâ¯grew 33%, driving its oncology division 20% higher than the same quarter in 2020, while diabetes drug Farxigaâ¯was up 50% in part due to receiving regulatory approval in the US to use the treatment for heart failure.
Its Brilinta drug to reduce the risk of future heart attacks dropped 8% as global demand fell due to the pandemic reducing the number of heart attack admissions to hospitals.
Respiratory and immunology dipped 1%, blamed on the introduction of a generic version of its Symbicort asthma inhaler in the US.
But asthma medicine, Fasenra, did see a boost in sales, making it the leading product for severe asthmas globally.
Astra’s Covid jab, developed in conjunction with Oxford University, has been approved for use in immunisation rollouts in more than 100 countries but is also proving a corporate headache.
The European Commission which has attempted to simultaneously restrict and hoard the shot, is now taking legal action over supply delays.
Reports over blood clots in a tiny fraction have led to debate over whether under-40’s should be offered an alternative: either the BioNTech/Pfizer or the Moderna vaccines.
AZ’s results compare favourably with FTSE 100 rival GlaxoSmithKline, which suffered a 18% slide in revenues in the first quarter.
Sebastian Skeet, a senior analyst at Third Bridge, said: "Against the backdrop of a global pandemic and GSK’s recent lacklustre earnings, AstraZeneca appears to be setting the benchmark for success amongst the world's big pharma' players."
“Whilst some questions remain around the mid-term competitive threats to key Alexion and oncology assets, the proposed acquisition brings in deep scientific expertise and pipeline candidates.
“Both of which could could be applied to far more prevalent disease and there is a near term opportunity to cross-sell Alexion products into China, a key and rapidly growing market for AstraZeneca”
"The public story for AstraZeneca is less impressive with negative sentiment around its vaccine persisting. Rollout efforts have been impacted by extremely rare blood clotting events, the EU's lawsuit, and questions around the path forward in the US.
"There is an urgent demand for vaccines in emerging economies which AstraZeneca’s candidate could cater for, especially given its favourable storage temperature requirements and the fact this remains a safe an effective vaccine option."
Medicines regulator the MHRA said the estimated number of first doses of AstraZeneca vaccine administered in the UK by April 21 was 22 million.
The number of cases of the rare combination of blood clots with low platelet counts had reached 209, including 41 deaths.