Last checked at 
* Vaccine adds one cent to Q3 EPS
* Co expects profit from shot to offset antibody costs
* Q3 sales jump 47%, but costs bite
* 2021 sales outlook improved, profit maintained
* Shares down 4.5%
(Releads, adds CEO comment)
By Pushkala Aripaka and Ludwig Burger
Nov 12 (Reuters) - AstraZeneca said it would begin
to earn a modest profit from its coronavirus vaccine as the
world learns to live with the virus and the drugmaker is in
talks with several countries about new orders for delivery next
year.
AstraZeneca made a commitment to sell the shot developed
with Oxford University at cost during the pandemic and in a
press conference on Friday said low-income nations would
continue to receive the vaccine on a no-profit basis, while a
post-pandemic commercial approach would apply to other new
orders even as infections in Europe rise again.
The Anglo-Swedish company's third-quarter results showed the
vaccine contributed one cent to core earnings per share of
$1.08, a rise of 14%. Total product sales jumped 49% to $9.74
billion, as its vaccine sales topped $1 billion.
"We started this project to help ... but we also said that
at some stage in the future, we will transition to commercial
orders," Chief Executive Pascal Soriot told journalists.
"It will never be high priced. Because we want the vaccine
to remain affordable to everybody around the world," he added.
Soriot, a French national, said the virus was becoming
endemic, a term for a background level of infections that is
part of everyday life.
Talks about new orders with undisclosed countries were
underway, mainly for delivery next year, with some prospective
customers focusing on booster shots, Soriot said.
AstraZeneca unveiled plans this week to set up a separate
unit to focus on its coronavirus efforts and other respiratory
infections. It said on Friday the unit would independently
manage production and distribution.
PROFIT FALLS SHORT
Shares of the FTSE 100 drugmaker were down 3.4% at
about 91.22 pounds at 1209 GMT as overall third-quarter profit
fell short of analysts' expectations.
There were strong performances of core products like kidney
disease treatment Farxiga and established asthma drug Symbicort,
and from the addition of rare-disease specialist Alexion from
July 21, thanks to last year's $39 billion takeover deal.
However, integration costs related to that deal ate into
profits, as did a $1.2 billion writedown for an experimental
kidney disease drug AstraZeneca acquired in 2012, with overall
expenses also rising on investments into the drug pipeline.
Top selling drug Tagrisso for lung cancer also posted
lower-than-expected growth in sales due to price cuts in China.
AstraZeneca said a profit boost from the vaccine in the
fourth quarter would make up for costs related to its antibody
cocktail for preventing and treating COVID-19, as it stuck with
its earnings forecast for the year.
Liberum analyst Alistair Campbell said in a note the higher
expenses would raise some concerns but the reiteration of
guidance was reassuring.
AstraZeneca's vaccine has had a tumultuous journey, with its
not-for-profit strategy and challenges around efficacy data,
supplies and links to rare blood clots, fuelling speculation on
whether it would want to keep the business in the long term.
The drugmaker and its Indian manufacturing partner, Serum
Institute, have supplied more than 1.5 billion vaccine doses as
of the end of September, compared with more than 2 billion from
the rival alliance of Pfizer and BioNTech https://investors.biontech.de/news-releases/news-release-details/biontech-announces-third-quarter-2021-financial-results-and
.
Pfizer this month forecast 2021 and 2022 sales from its
COVID-19 vaccine of at least $65 billion overall, topping
estimates. However, Moderna slashed its 2021 sales
outlook for its shot by as much as $5 billion, on production
hiccups.
Including sales from the vaccine in the fourth quarter,
AstraZeneca now expects 2021 revenues to grow by a mid-to-high
twenties percentage. It previously expected sales to grow by a
low-twenties percentage excluding the shot.
Analysts on average were expecting third-quarter profit of
$1.28 per share on sales of $9.4 billion, according to Refinitiv
IBES data.
(Reporting by Pushkala Aripaka in Bengaluru and Ludwig Burger
in Frankfurt
Editing by Elaine Hardcastle)
