On a human level AstraZeneca’s vaccine saga has been disappointing; the clash with the EU, new data demonstrating a lack of efficacy in preventing mild to moderate infection caused by the South African variant, and the decision by German authorities to limit vaccinations in persons under 65 years old. Ultimately, this does represent a share price overhang too.
However, the opposite can be said for AstraZeneca’s core business. The company is arguably the poster child for big pharma turnarounds, with CEO Pascal Soriot rebuilding the pipeline and establishing the necessary growth drivers. This is exemplified by AstraZeneca’s recent performance. which demonstrated double digit revenue growth, improved profitability and core EPS growth of 18% at constant exchange rates.”
The oncology portfolio, AstraZeneca’s crown jewels, has grown 23% year-on-year driven by Tagrisso, Lyparza and Imfinzi. Historically muted sales for Calquence, and even Imfinzi by comparison to its peer group, have either been buoyed by recent trial results, or have more on the way. AstraZeneca’s $39bn bid for Alexion is still raising questions, with some investors yet to warm to the idea given a heavy reliance on a two drugs, Soliris and Ultomiris, and potential competitors lining up.
Backed by a rich pipeline including Tezepelumab, and with Enhertu gaining FDA approval in breast and gastric cancer, top line growth is looking strong. That being said, the impact of the pandemic has been felt and we could see a hangover effect on patient volumes in the coming quarters.