AstraZeneca Revenue Hurt as Demand for COVID-19 Treatments Slumps; Stock Drops

Key takeaways

  • AstraZeneca PLC missed its profit forecast on Thursday as its fourth-quarter sales were slowed by falling demand for COVID-19 vaccines and drugs.
  • The drugmaker's revenues have also been negatively affected by generic competition in Japan for its acid reflux treatment Nexium.
  • AstraZeneca's American Depositary Receipts (ADRs) fell to their lowest level in 16 months following the release of results on Thursday.

AstraZeneca PLC's (AZN) American depositary receipts (ADRs) fell more than 4% on Thursday after the drugmaker said its profits were hit by falling demand for COVID-19 treatments .

The British-Swedish pharmaceutical company reported core earnings per share (EPS) of $1.45 for the fourth quarter, below forecasts. Revenue rose 7% to $12.02 billion, essentially in line with analyst estimates.

For the full year, core EPS was $7.26, with revenue up 3% to $45.81 billion. The company noted that its revenue was negatively affected by falling sales of COVID-19 vaccines and immune therapies (V&I), which reduced the total by $3.74 billion.

Fourth-quarter V&I revenue plunged 64% to $413 million year-over-year (YOY) following “landmark contracts” in 2022 for its Vaxzevria injection and monoclonal antibody (mAbs) treatments. Sales in its “Other Medicines” category fell 33% as its acid reflux pill Nexium faced generic competition in Japan.

CEO Pascal Soriot remained optimistic, saying that the company's “differentiated and growing portfolio of approved medicines, global reach and rich R&D pipeline give us confidence that we will continue to deliver industry-leading growth.”

AstraZeneca sees its full-year core EPS and revenue increase by a low double-digit percentage to a low 15% at constant currencies.

AstraZeneca ADRs were down 4.4% at $63.62 Thursday around 1:45 p.m. ET. The stock, which fell to $61.70 earlier in the session, hit its lowest level since October 2022.

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