PRESSURE on the pharmaceutical industry from generic competition and government-squeezed prices was evident again yesterday as AstraZeneca reported a 21 per cent drop in second quarter sales.
The loss of exclusivity on the firm’s top-selling antipsychotic drug Seroquel was responsible for 15 percentage points of the revenue decline, while pre-tax profits tumbled by a third to £2.16bn.
Yet Astra’s earnings per share yesterday surpassed analyst forecasts, slipping just 12 per cent to $1.53 a share – significantly above consensus predictions of $1.39 a share, and helping the firm’s share price to close up 0.15 per cent in London.
The better than expected earnings were boosted by the release of a tax provision in quarter two, which lifted core earnings by 19 cents a share.
“We’re always actively looking outside for high-quality science, high-quality projects and high-quality product portfolios to bring into AstraZeneca,” finance chief Simon Lowth commented.
The news came a day after AstraZeneca’s rival GlaxoSmithKline, the UK’s biggest pharma company, reported a four per cent decline in sales for the three months to June, itself citing price cuts imposed by European governments.
In a further sign of the state of the industry, the stock of two of the world’s largest generics firms spiked in the US yesterday.
Mylan posted second-quarter profit well above Wall Street estimates, while rival Watson Pharmaceuticals raised its full-year forecast after reporting quarterly results.
Mylan closed up 4.9 per cent, while Watson closed up 1.4 per cent.