AstraZeneca Q1 2015 profit dropped

The second-largest pharmaceutical company in UK AstraZeneca Q1 2015 profit dropped, due to weaker sales of two of her most popular medicines and currency fluctuations. Part of the profits fell by 7% to 1.37 billion USD, or 1.08 dollars per share. An year ago the company reported profit of 1.47 billion USD, or 1.17 USD per share. The total revenues in Q1 2015 amounted to 6.06 billion USD, as last year they were 40 million USD more.

Sales of two of the best selling medicines of AstraZeneca – Nexium and Crestor. fall because of the expiration of their patents. At the same time revenues from new medicines grow at a slower pace than what analysts had predicted. The sales will shrink this and next year, before the expected increase in 2017, when the new medicines will raise revenue, says AstraZeneca.

Nexium sales fell by 31% to 644 million USD in the first quarter, although it exceeded the forecast of 589 million USD.

AstraZeneca is facing difficulties in the implementation of short-term goals and the promise of CEO Pascale Soriano is to increase annual revenue of 26 billion USD last year to 45 billion USD in 2023. In this regard, currently held AstraZeneca has 72 cancer researches. It aims to present for approval AZD9291, a medicine for the treatment of lung cancer worth at 3 billion USD.

AstraZeneca seek other sources of revenue, including market partnerships. Last month, the company announced that Tokyo-based Daiichi Sankyo Co will sell in the US Movantik their medicine in exchange for 200 million USD advance and to 625 million USD of sales. Such agreements, however, may not be the best strategy, says Alistair Campbell, an analyst at Berenberg. According to him, revenues have increased due to the partial sale of some medicines, but these actions raise concerns if the company does not use long-term options to ensure short-term profits.

AstraZeneca confirmed its forecast for a decline in revenue of up to 10% in 2015 at constant exchange rates, the basic earnings per share will also be increased by up to 10% on the same basis. Soriano made a forecast of the company’s sales last year, when successfully overcame the experience of Pfizer AstraZeneca to absorb the amount of 117 billion USD. Last month, the company said that by 2023 its new cancer medicine can generate a quarter of sales, after last year they accounted for only 12%.