AstraZeneca maintains outlook as cancer, rare disease drugs drive profit beat
July 27 (Reuters) – AstraZeneca backed its annual and long-term forecasts on Monday after second-quarter profit expectations rose on demand for cancer and rare disease treatments. The drugmaker was trying to allay concerns after disruptions in recent trials.
While strong demand continues to support growth despite broader price pressures, an unexpected trial failure this month has put the spotlight on AstraZeneca’s drug pipeline and whether its long-term revenue target is under threat.
While the company separately detailed the outcome of a successful late-stage stomach cancer study, another study on the rare disease drug ultomiris failed to meet the primary objective of the study in patients with life-threatening complications from stem cell transplants.
AstraZeneca shares were up 1.6% in early trading.
PHARMACEUTICAL DIVERSITY
The pharmaceutical giant’s diversity of therapeutic areas and approved drugs and its broad success in clinical trials distinguish it from its peers. But the results of two other upcoming late-stage studies will be a litmus test for longtime CEO Pascal Soriot.
“We remain confident in the strength of our pipeline and have more than twenty high-value readings over the next 18 months,” Soriot said in a statement.
In 2024, AstraZeneca set a goal of reaching $80 billion in annual revenue by 2030; JPMorgan analysts said Monday the company could achieve that.
2026 OUTLOOK PRESERVED
AstraZeneca continues to expect 2026 underlying earnings per share to grow by a low double-digit percentage at constant exchange rates, with total revenue to grow by a mid-to-high single-digit percentage. Last year, it reported growth in sales and profit of approximately 8% and 11%, respectively.
Core earnings rose 18% to $2.63 per share in the three months ended June 30, helped by lower taxes, while total revenue rose 5% to $15.38 billion.
Analysts on average expected earnings of $2.48 per share on sales of $15.39 billion, according to a consensus compiled by the company.
The company’s shares have fallen nearly 8% this year, lagging behind rival GSK, even though its price has more than quadrupled during Soriot’s 14-year tenure.
(Reporting by Pushkala Aripaka in Bengaluru and Maggie Fick, Raechel Thankam Job and Sri Hari NS in London; Editing by Mrigank Dhaniwala, Kirsten Donovan)
