July 27 (Reuters) – AstraZeneca backed its annual and long-term forecasts on Monday after topping second-quarter profit expectations on demand for its cancer and rare disease therapies, as the drugmaker sought to quell concerns after recent trial setbacks.
Although strong demand continues to drive growth against a background of broader pricing pressures, an unexpected trial failure this month has turned attention to AstraZeneca’s drug pipeline and whether its longer-term revenue target could be under threat.
The company separately detailed the outcome of a successful late-stage gastric cancer trial, while another study of its rare-disease drug ultomiris failed to meet the primary goal of a study in patients with a life-threatening complication from stem-cell transplants.
AstraZeneca shares were up 1.6% in early trading.
PHARMACEUTICAL DIVERSITY
The pharmaceutical giant’s diversity in therapeutic areas and approved drugs and broad success in clinical trials sets it apart from its peers. However, results from two other upcoming late-stage studies will be a litmus test for long-time CEO Pascal Soriot.
“We remain confident in the strength of our pipeline and have more than twenty high-value readouts due over the next 18 months,” Soriot said in a statement.
AstraZeneca in 2024 set a target to reach $80 billion in annual revenue by 2030, something JPMorgan analysts said on Monday that the company would be able to achieve.
2026 OUTLOOK MAINTAINED
AstraZeneca continues to expect 2026 core earnings per share to increase by a low double-digit percentage at constant currency rates, with total revenue rising at a rate in the mid-to-high-single digits. It reported sales and profit growth of about 8% and 11%, respectively, last year.
Core earnings for the three months ended June 30 jumped 18% to $2.63 per share, helped by lower taxes, while total revenue rose 5% to $15.38 billion.
Analysts on average were expecting profit of $2.48 per share on sales of $15.39 billion, according to a company-compiled consensus.
Although the company’s shares have more than quadrupled in price under Soriot’s 14-year tenure, they are down about 8% this year, trailing rival GSK.
(Reporting by Pushkala Aripaka in Bengaluru and Maggie Fick in London, Raechel Thankam Job and Sri Hari N S; Editing by Mrigank Dhaniwala, Kirsten Donovan)
Comments