|  Updated: 

AstraZeneca: Revenue boost despite welcome end of Covid-19 jab sales

By:

TMT Reporter

Add as a preferred source on Google
The Cambridge-based pharma firm is paying $2bn cash up front as part of the deal
The Cambridge-based pharma firm is paying $2bn cash up front as part of the deal

Britain’s biggest FTSE firm AstraZeneca reported an uptick in sales as oncology treatments helped pick up the slack from falling sales of Covid-19 medicines.

The pharmaceutical company made over $22.2bn (£17.3bn) – a four per cent increase – during the first half of 2023, causing shares to spring over three per cent on market open Friday morning.

Covid-19 medicine sales dropped by more than $2.1bn (£1.6bn), with the firm registering no revenue at all in the second quarter from its pandemic-era jab.

Non-Covid total revenue grew by 16 per cent while revenue from cancer medicines increased 22 per cent.

Gross margin improved by three percentage points to 83 per cent after AZ sold fewer lower-priced Covid-19 medicines and more high-priced speciality medicines.

AstraZeneca is the UK’s largest firm by market cap.

AstraZeneca chief executive, Pascal Soriot, said: “Each of our non-COVID-19 therapy areas saw double-digit revenue growth, with eight medicines delivering more than $1bn of revenue in the first half, demonstrating the strength of our business.

“Several medicines grew rapidly including Ultomiris, Imfinzi/Imjudo and Farxiga, with revenues up 64%, 57% and 40% respectively.”

He added that AZ’s “pipeline momentum continues” with eight positive trials for cancer medicines.

In April, AZ reported a 4 per cent fall in revenue to $10.9bn (£8.7bn) as Covid-19 medicines drooped, offset by oncology drugs.

Derren Nathan, head of equity research at Hargreaves Lansdown, said: “AstraZeneca’s more than filled the $2bn hole left from declining COVID 19 sales in the first half of this year, with total revenues up by 4% to $22.3bn.

“Whilst the first half landed ahead of analyst estimates, the dividend has been held flat and there’s been no upgrade to guidance. Turning to the development pipeline, cancer treatments are again high on the agenda.

“The valuation has taken a knock of late following inconclusive late stage read outs for lung cancer candidate datopotamab deruxtecan. There’s still hope that this can become a commercial success and Astra’s landed 9 other regulatory approvals since it announced first-quarter results.”

It comes following recent reports that AstraZeneca is looking at plans to spin off its Chinese businesses to protect it from geopolitical tension.