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LONDON (Alliance News) - AstraZeneca PLC Thursday reiterated its guidance for 2016 as it saw revenue down 3% in its first nine months, hit by generic competition in the US to its core anti-cholesterol statin Crestor.
AstraZeneca continues to expect core earnings per share and total revenue both to suffer low to mid-single-digit percentage declines in 2016, including dilutive effects arising from its acquisitions of Acerta Pharma and ZS Pharma during 2015.
AstraZeneca's core results exclude amortisation, impairment, charges and provisions related to restructuring and other exceptional costs.
It noted that its core research and development costs are now expected to be ahead of those in 2015, although it will materially reduce core selling, general and administrative costs in 2016 compared to 2015.
For the nine months to the end of September, AstraZeneca reported a pretax profit of USD1.37 billion, down from USD2.27 billion the previous year, as revenue slipped by 3% to USD17.42 billion from USD18.30 billion.
Core earnings per share fell to USD3.10 for the nine months from USD3.32 the previous year.
Revenue was hit by the market entry of multiple generic competitors to Crestor in the US, as well as generic competition to AstraZeneca's acid reflux medicine Nexium. Sales of Crestor and Nexium in the US fell 82% and 50% in the third quarter to the end of September, respectively.
However, revenue from growth platforms rose 6% in the first nine months, and made up 62% of total revenue.
"The performance in the third quarter was in line with our expectations, reflecting the transitional impact from the first full quarter of generic competition to Crestor in the US. We sharpened significantly our focus on our three therapy areas, by prioritising our portfolio through externalisation and divestments. This focus, underpinned by our productivity initiatives, supported the rapid reduction in SG&A costs. This enabled our increased investment in Oncology, as well as in China and launched new medicines in key markets," said AstraZeneca Chief Executive Officer Pascal Soriot in a statement.
"Importantly, we are entering an intensive period of news flow over the next twelve months, in particular revealing the potential of our Immuno-Oncology and targeted medicines. Our focus on scientific excellence keeps us on track with our goals, as we approach an inflection point of a pipeline designed to transform our company and the lives of patients," Soriot added.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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