Strong growth and pipeline momentum with three
new medicines approved since the third quarter
AstraZeneca:
Revenue and EPS summary
FY 2023
Q4 2023
% Change
% Change
$m
Actual
CER1
$m
Actual
CER
- Product Sales
43,789
2
4
11,323
5
5
- Alliance Revenue2
1,428
89
89
424
69
67
- Collaboration Revenue2
594
(1
)
(1
)
277
75
74
Total Revenue
45,811
3
6
12,024
7
8
Total Revenue ex COVID-19
45,488
13
15
12,036
16
16
Reported EPS
$3.84
81
96
$0.62
7
5
Core3 EPS
$7.26
9
15
$1.45
5
7
Financial performance for full year 2023 (Growth numbers
at CER)
- Total Revenue $45,811m, up 6% despite a decline of $3,736m from
COVID-19 medicines4
- Excluding COVID-19 medicines, Total Revenue increased 15% and
Product Sales increased 14%
- Double-digit Total Revenue growth from Oncology 21%, CVRM 18%,
R&I 10%, and Rare Disease 12%
- Core Product Sales Gross Margin5 of 82%, up two percentage
points, reflecting the decline in sales of lower margin COVID‑19
medicines
- Core Operating Margin of 32% increased by two percentage points
including the previously announced gain from an update to the
contractual relationships for Beyfortus, totalling $712m and
recorded as Core Other operating income. In the quarter, higher
SG&A expense drove lower operating margins, partly due to
phasing of expenses and increased investment in launches for
Airsupra, Wainua and Truqap
- The Core Tax Rate for the year was 17%. In the fourth quarter,
the tax rate was negatively impacted by reviews by tax authorities,
administrative appeal processes and other adjustments, offset by a
routine intragroup reorganisation of IP, leading to a tax rate of
10% in the quarter
- Core EPS increased 15% to $7.26
- Second interim dividend declared of $1.97 per share, making a
total dividend declared for FY 2023 of $2.90 per share
- Total Revenue and Core EPS in FY 2024 are each expected to
increase by a low double-digit to low teens percentage at CER
Pascal Soriot, Chief Executive Officer, AstraZeneca,
said:
"As AstraZeneca celebrates its 25th anniversary, we are pleased
to report another year of strong financial performance and
scientific progress, with double-digit earnings growth, and
investment in exciting areas of science, including antibody drug
conjugates and cell therapies, that lay the foundations for
long-term success.
We expect another year of strong growth in 2024, driven by
continued adoption of our medicines across geographies. Our
differentiated and growing portfolio of approved medicines, global
reach and rich R&D pipeline give us confidence that we will
continue to deliver industry-leading growth."
Key milestones achieved since the prior results
announcement
- Three first approvals for new molecular entities: Truqap
(capivasertib), Wainua (eplontersen), Voydeya (danicopan)
- US approvals for Truqap plus Faslodex in HR-positive,
HER2-negative advanced breast cancer with biomarker alterations
(CAPItello-291), and Wainua for ATTRv-PN (NEURO-TTRansform). China
approvals for Imfinzi in mBTC (TOPAZ-1) and Beyfortus for
prevention of RSV in infants (MEDLEY/MELODY). First approval, in
Japan, for Voydeya, as an add-on therapy to Ultomiris or Soliris
for PNH with EVH (ALPHA)
- Enhertu granted Priority Review in the US for patients with
metastatic HER2-positive solid tumours
Guidance
The Company issues its Total Revenue and Core EPS guidance for
FY 2024 at CER, based on the average foreign exchange rates through
2023.
Total Revenue is expected to increase by a low
double-digit to low teens percentage
Core EPS is expected to increase by a low
double-digit to low teens percentage
- Collaboration Revenue is expected to increase substantially,
driven by success-based milestones and certain anticipated
transactions
- Other operating income is expected to decrease substantially
(FY 2023 included a $241m gain on the disposal of Pulmicort
Flexhaler US rights, and a $712m one-time gain relating to updates
to contractual arrangements for Beyfortus)
- The Core Tax rate is expected to be between 18-22%
The Company is unable to provide guidance on a Reported basis
because it cannot reliably forecast material elements of the
Reported results, including any fair value adjustments arising on
acquisition-related liabilities, intangible asset impairment
charges and legal settlement provisions. Please refer to the
cautionary statements section regarding forward-looking statements
at the end of this announcement.
Currency impact
If foreign exchange rates for February 2024 to December 2024
were to remain at the average rates seen in January 2024, it is
anticipated that both FY 2024 Total Revenue and Core EPS would
incur a low single-digit adverse impact versus the performance at
CER. The Company's foreign exchange rate sensitivity analysis is
provided in Table 19.
Investor Day
AstraZeneca will host an Investor Day on 21 May 2024.
For more information, see
www.astrazeneca.com/investor-relations.html.
Table 1: Key elements of Total Revenue performance in Q4
2023
% Change
Revenue type
$m
Actual %
CER %
Product Sales
11,323
5
5
* Excluding COVID-19 medicines,
Q4 2023 Product Sales increased by 14%
Alliance Revenue
424
69
67
* $281m for Enhertu (Q4 2022:
$188m)
* $80m for Tezspire (Q4 2022:
$37m)
* $41m for Beyfortus (Q4 2022:
$nil)
Collaboration Revenue
277
75
74
* $245m Lynparza regulatory
milestone (Q4 2022: $105m)
* $27m Beyfortus sales milestone
(Q4 2022: $nil)
Total Revenue
12,024
7
8
* Excluding COVID-19 medicines,
Q4 2023 Total Revenue increased by 16%
Therapy areas
$m
Actual %
CER %
Oncology
4,989
23
24
* Strong performance across all
key medicines and regions
CVRM
2,702
18
18
* Farxiga up 36% (35% at CER),
Lokelma up 38%, roxadustat up 27%, Brilinta declined 5% (4% at
CER)
R&I
1,675
13
13
* Fasenra up 10% (9% CER),
Breztri up 72%. Saphnelo and Tezspire also continue to grow
rapidly, partially offset by a 16% decline in Symbicort following
entry of a generic competitor in the US in the third quarter
V&I
413
(64
)
(66
)
* $6m revenue from COVID-19 mAbs
and ‑$17m for Vaxzevria, both resulting from historic contracts (Q4
2022: $734m and $95m respectively)
* Beyfortus $122m, including $41m
of Alliance Revenue for AstraZeneca's share of gross profits
outside US, $27m of Collaboration Revenue for a sales milestone and
$54m of Product Sales from product supplied to Sanofi
Rare Disease
1,971
9
9
* Ultomiris up 39% (38% at CER),
partially offset by decline in Soliris of 15% (13% at CER)
* Strensiq up 12% (13% at CER)
and Koselugo up 46% (48% at CER) reflecting strong patient
demand
Other Medicines
274
(33
)
(32
)
* Nexium generic competition in
Japan
Total Revenue
12,024
7
8
Regions inc. COVID-19
$m
Actual %
CER %
US
5,101
7
6
Emerging Markets
2,783
2
8
- China
1,382
16
16
- Ex-China Emerging Markets
1,401
(9
)
2
Europe
2,880
25
17
Established RoW
1,259
(9
)
(6
)
Total Revenue inc. COVID-19
12,024
7
8
* Growth rates impacted by lower sales of
COVID-19 medicines (see table below)
Regions ex. COVID-19
$m
Actual %
CER %
US
5,101
12
12
Emerging Markets
2,791
15
22
- China
1,382
16
16
- Ex-China Emerging Markets
1,409
14
27
Europe
2,884
33
25
Established RoW
1,259
4
8
Total Revenue ex. COVID-19
12,036
16
16
Table 2: Key elements of financial performance in Q4
2023
Metric
Reported
Reported
change
Core
Core
change
Comments6
Total Revenue
$12,024m
7% Actual
8% CER
$12,024m
7% Actual
8% CER
* Excluding COVID-19 medicines,
Q4 2023 Total Revenue increased by 16%
* See Table 1 and the Total
Revenue section of this document for further details
Product Sales Gross Margin
80%
+6pp Actual
+6pp CER
80%
+3pp Actual
+2pp CER
+ In the prior year period, gross
margins were reduced due to inventory write-downs and manufacturing
contract terminations for Evusheld
* Variations in Product Sales
Gross Margin can be expected between periods due to product
seasonality, foreign exchange fluctuations and other effects
R&D expense
$3,073m
17% Actual
15% CER
$2,914m
15% Actual
14% CER
+ Increased investment in the
pipeline
* Core R&D-to-Total Revenue
ratio of 24% (Q4 2022: 23%)
+ Quarterly phasing impact
SG&A expense
$5,371m
16% Actual
16% CER
$4,034m
13% Actual
12% CER
+ Market development for recent
launches and pre-launch activities
* Core SG&A-to-Total Revenue
ratio of 34% (Q4 2022: 32%)
+ Quarterly phasing impact
Other operating income and
expense7
$107m
-43% Actual
-42% CER
$107m
-17% Actual
-15% CER
‒ Discontinuation of brazikumab
development
Operating Margin
10%
+1pp Actual
+1pp CER
23%
Stable
* See Product Sales Gross Margin,
expenses and Other operating income and expense commentary
above
Net finance expense
$337m
7% Actual
3% CER
$259m
5% Actual
1% CER
+ Higher rates on floating debt
and bond issuances
+ Increased Interest expense on
income tax balances
‒ Higher interest received on
cash and short-term investments
Tax rate
-7%
+9pp Actual
+13pp CER
10%
Stable
‒ Intragroup purchase of
intellectual property
+ Reviews by tax authorities,
administrative appeals and changes to certain deferred tax
balances
* Variations in the tax rate can
be expected between periods
EPS
$0.62
7% Actual
5% CER
$1.45
5% Actual
7% CER
* Further details of differences
between Reported and Core are shown in Table 14
Table 3: Pipeline highlights since prior results
announcement
Event
Medicine
Indication / Trial
Event
Regulatory approvals and other
regulatory actions
Truqap
HR-positive HER2-negative
advanced breast cancer with biomarker alterations
(CAPItello-291)
Regulatory approval (US)
Imfinzi
Biliary tract cancer
(TOPAZ-1)
Regulatory approval (CN)
Wainua
ATTRv-PN (NEURO-TTRansform)
Regulatory approval (US)
Beyfortus
RSV (MELODY-MEDLEY)
Regulatory approval (CN)
Voydeya
PNH with EVH (ALPHA)
Regulatory approval (JP)
Regulatory submissions or
acceptances*
Lynparza
gBRCA breast cancer (adjuvant)
(OlympiA)
Regulatory submission (CN)
Lynparza + Imfinzi
Endometrial cancer (1st-line)
(DUO-E)
Regulatory submission (US, EU,
JP)
Enhertu
HER2-expressing tumours
(DESTINY-PanTumor02, DESTINY-Lung01, DESTINY-CRC02)
Regulatory submission (US),
Priority Review (US)
Enhertu
HER2+/HER2-low gastric (1st-line)
(DESTINY-Gastric01)
Regulatory submission (CN)
Imfinzi + Imjudo
NSCLC (neoadjuvant) (AEGEAN)
Regulatory submission (EU)
Wainua
ATTRv-PN (NEURO-TTRansform)
Regulatory submission (EU)
Fasenra
EGPA (MANDARA)
Regulatory submission (US, EU,
JP)
Ultomiris
NMOSD (CHAMPION-NMOSD)
Regulatory submission (US)
Ultomiris
gMG
Regulatory submission (CN)
Major Phase III data readouts and
other developments
Imfinzi
NSCLC (unresectable, Stg. III)
(PACIFIC-2)
Primary endpoint not met
acoramidis 8
ATTR-CM
Primary endpoint met
*US, EU and China regulatory
submission denotes filing acceptance
Upcoming pipeline catalysts
For a table of anticipated timings of key trial readouts, please
refer to page 3 of the Clinical Trials Appendix, available on
www.astrazeneca.com/investor-relations.html.
Table 4: Phase III trials started since 1 January
2023
Medicine
Trial name
Indication
datopotamab deruxtecan
AVANZAR
NSCLC (1st-line)
TROPION-Lung07
Non-squamous NSCLC (1st-line)
TROPION-Breast04
Neoadjuvant/adjuvant
triple-negative or HR-low/HER2-negative breast cancer
TROPION-Breast05
PD-L1-positive locally recurrent
inoperable or metastatic TNBC
camizestrant
CAMBRIA-1
HR-positive/HER2-negative
adjuvant breast cancer
CAMBRIA-2
HR-positive/HER2-negative
adjuvant breast cancer
Truqap
CAPItello-292
HR-positive/HER2-negative
advanced breast cancer
volrustomig
eVOLVE-Cervical
High-risk locally advanced
cervical cancer
eVOLVE-Lung02
mNSCLC (1st-line) with PD-L1
<50%
eVOLVE-Meso
Unresectable malignant pleural
mesothelioma (1st-line)
eVOLVE-HNSCC
Unresected, locally advanced
HNSCC
rilvegostomig
ARTEMIDE-Biliary01
BTC with curative intent
saruparib
EvoPAR-PR01
HRRm and Non-HRRm mCSPC
zibo/dapa
ZENITH High Proteinuria
CKD with high proteinuria
Saphnelo
DAISY
Systemic sclerosis
baxdrostat
BaxHTN
Uncontrolled, including
treatment-resistant, hypertension
Tezspire
CROSSING
Eosinophilic oesophagitis
Breztri
LITHOS
Mild to moderate asthma
ATHLOS
COPD
pMDI portfolio
HFO1234ze + Breztri
COPD
HFO1234ze
Mucociliary clearance in healthy
volunteers
HFO1234ze
Asthma
tozorakimab
MIRANDA
COPD
ipavibart (AZD3152)
SUPERNOVA
COVID-19 prophylaxis
Ultomiris
ARTEMIS
Cardiac surgery-associated acute
kidney injury
ALXN2220
DepleTTR-CM
Transthyretin amyloid
cardiomyopathy
efzimfotase alfa (ALXN1850)
HICKORY
Hypophosphatasia
Corporate and business development
In November 2023, AstraZeneca launched Evinova, with an ambition
to become a leading provider of digital health solutions to better
meet the needs of healthcare professionals, regulators and
patients. Evinova will prioritise bringing to market established
and scaled digital technology solutions already being used globally
by AstraZeneca to optimise clinical trial design and delivery.
Globally-leading clinical research organisations Parexel and
Fortrea have entered into agreements to offer Evinova digital
health solutions to their wide customer base.
In December 2023, AstraZeneca entered into a definitive
agreement to acquire Icosavax, Inc (Icosavax). The acquisition
strengthens AstraZeneca's late-stage pipeline with Icosavax's lead
investigational vaccine candidate, IVX-A12, a potential
first-in-class, Phase III-ready, combination VLP vaccine that
targets both RSV and hMPV. RSV and hMPV are both leading causes of
severe respiratory infection and hospitalisation in adults 60 years
of age and older and those with chronic conditions such as
cardiovascular, renal and respiratory disease. Subject to the
satisfaction of the conditions in the merger agreement, the
acquisition is expected to close in the first quarter of 2024.
In December 2023, AstraZeneca entered into a definitive
agreement to acquire Gracell Biotechnologies Inc. (Gracell), a
global clinical-stage biopharmaceutical company developing
innovative cell therapies for the treatment of cancer and
autoimmune diseases. The proposed acquisition will enrich
AstraZeneca's growing pipeline of cell therapies with GC012F, a
novel, clinical-stage FasTCAR-enabled BCMA and CD19 dual-targeting
CAR-T therapy, a potential new treatment for multiple myeloma, as
well as other haematologic malignancies and autoimmune diseases
including systemic lupus erythematosus. The transaction is expected
to close in the first quarter of 2024, subject to customary closing
conditions, including regulatory clearances, and Gracell
shareholder approval.
In February 2024, AstraZeneca announced that it is investing
$300 million in a state-of-the-art facility in Rockville, Maryland
to establish life-saving cell therapy platforms for critical cancer
trials and future commercial supply. To align with clinical trial
timelines, the site will initially focus on pivotal clinical trial
manufacturing of CAR-T cell therapies to meet current clinical
supply demand. More than 150 new highly skilled jobs will be
created to initially focus on manufacturing T-cell therapies to
enable clinical trials to be conducted around the world. Over time,
the site may expand its focus to support other therapy areas.
Sustainability highlights
Through the Sustainable Markets Initiative Health Systems Task
Force, AstraZeneca announced an industry-first renewable power
agreement in China together with four global healthcare leaders and
renewable energy company Envision Energy, resulting in potential
annual emissions savings of approximately 120,000 tonnes, the
equivalent of taking 25,000 cars off the road. See the
Sustainability section in this document for further details.
Conference call
A conference call and webcast for investors and analysts will
begin today, 8 February 2024, at 11:45 UK time. Details can be
accessed via astrazeneca.com.
Reporting calendar
The Company intends to publish its Q1 2024 results on 25 April
2024.
To read AstraZeneca's Full Year and Q4 2023 Financial Results
press release in full, click here.
______________________________
1
Constant exchange rates. The
differences between Actual Change and CER Change are due to foreign
exchange movements between periods in 2023 vs. 2022. CER financial
measures are not accounted for according to generally accepted
accounting principles (GAAP) because they remove the effects of
currency movements from Reported results.
2
Effective 1 January 2023, the
Group has updated the presentation of Total Revenue. For further
details of the presentation of Alliance Revenue and Collaboration
Revenue, see the Basis of preparation and accounting policies
section of the Notes to the Condensed consolidated financial
statements section.
3
Core financial measures are
adjusted to exclude certain items. The differences between Reported
and Core measures are primarily due to costs relating to the
acquisition of Alexion, amortisation of intangibles, impairments,
legal settlements and restructuring charges. A full reconciliation
between Reported EPS and Core EPS is provided in Table 13 and Table
14 in the Financial performance section of this document.
4
The COVID-19 medicines are
Vaxzevria, Evusheld, and sipavibart (AZD3152) – the COVID-19
antibody currently in development.
5
The calculation of Reported and
Core Product Sales Gross Margin (formerly termed as Gross Margin)
excludes the impact of Alliance Revenue and Collaboration
Revenue.
6
In Table 2, the plus and minus
symbols denote the directional impact of the item being discussed,
e.g. a ‘+’ symbol next to an R&D expense comment indicates that
the item increased the R&D expense relative to the prior
year.
7
Income from disposals of assets
and businesses, where the Group does not retain a significant
ongoing economic interest, continue to be recorded in Other
operating income and expense in the Company’s financial
statements.
8
Partnered with BridgeBio Pharma
Inc (BridgeBio) – AstraZeneca has rights to commercialise
acamoridis in Japan
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version on businesswire.com: https://www.businesswire.com/news/home/20240207868410/en/
US Media Inquiries Brendan McEvoy, +1 302 885 2677
US Media Mailbox: usmediateam@astrazeneca.com
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