By Suzi Ring
(Bloomberg) – AstraZeneca, one of the drugmakers on the front lines of Covid-19 vaccine efforts, said earnings growth will accelerate this year as its turnaround efforts pay off.
Profit excluding some items will be $4.75 a share to $5 (R73) a share, the drugmaker said in a statement. The range was below the $5.22 (R76) analysts had anticipated, but the guidance excludes the impact of the vaccine and the takeover of rare-disease specialist Alexion Pharmaceuticals.
Astra has rebuilt a pipeline of key blockbuster drugs, especially in cancer, and stands to benefit even as the Covid-19 outbreak dents drugmakers’ growth prospects by discouraging doctor’s visits. The vaccine it developed with the University of Oxford is a crucial tool governments are counting on to help curb the pandemic.
The main questions facing Astra’s vaccine are about its efficacy in the elderly and the shot’s ability to thwart new variants such as the one that first emerged in South Africa. A US vaccine study of roughly 30,000 volunteers is expected to readout in the coming weeks and the company is working on adapting the shot to new disease strains.
Astra shares rose 1.7% in early London trading.
The company expects total revenue this year to rise by a low-teens percentage. The vaccine has already delivered $2m (R29m) in sales, and Astra said it will start reporting the revenue separately from next quarter. Sales of key blockbuster drugs such as Imfinzi and Tagrisso were roughly in line with analysts’ estimates last year.
Astra may have another unexpected weapon in the pandemic. One of its older drugs on Wednesday showed potential against the new virus in a small study. Early treatment with the inhaled asthma medicine Pulmicort cut the need for urgent care and hospitalization in the test, which may give it a welcome boost since it was one of the portfolio’s few laggards last year.
The Alexion takeover is due to close in the third quarter. One deal motivator was profitability, the company said when announcing the transaction.
Read also:
- AstraZeneca Covid-19 shot is still worth using – WHO
- New AstraZeneca vaccine in the works to fight SA-discovered ‘501.v2’ variant
- Covid-19 variants and the outlook for the pandemic
