AstraZeneca PLC's (AZN.LN) sales continued to fall in the third quarter, hit by competition for some of its best-selling drugs. But the pace of the decline slowed as revenue from new medicines picked up.
Investors sent shares up 1.7% in midday London trading, after the company said an expected profit dip this year won't be as steep as previously feared.
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AstraZeneca said sales for the quarter fell 3%, to $4.88 billion, due to the loss of exclusivity on its cholesterol-lowering drug Crestor and antipsychotic drug Seroquel. The drop, though, was significantly less severe than the 11% fall in sales AstraZeneca reported in the first six months of the year.
And there were some bright spots. Sales of Tagrisso, a promising new lung cancer drug, nearly doubled to $248 million in the quarter.
Net income fell 35% to $649 million in the third quarter, mostly due to an unfavorable year-earlier comparison. Earnings were boosted then by a one-off tax windfall. Core earnings per share, an industry metric that exclude some one-time items, fell by 15% to $1.12.
AstraZeneca has warned of declining sales, but it has also promised that 2017 would be the year in which revenue bottoms out. After rebuffing a $120 billion offer from rival Pfizer Inc. in 2014, Chief Executive Pascal Soriot has promised to boost growth starting next year.
The company buoyed investors by saying its profit won't fall as sharply this year, thanks to a $997 million payment from Merck & Co., part of a new research collaboration between the two. The Anglo-Swedish company had guided investors earlier this year to expect earnings per share to suffer a "low to mid-teens percentage decline." On Thursday, it said full-year results will be "towards the favorable end" of that range.
"We will in the not so-far future emerge as a fast-growing company," said Dr. Soriot in a conference call with reporters.
AstraZeneca's top line has been shrinking for several years as its blockbuster drugs lose patent protection. Cheap copycats have stolen away sales.
It has also had some mixed laboratory results In July, AstraZeneca reported disappointing results for a closely watched lung cancer drug trial.
Write to Noemie Bisserbe at firstname.lastname@example.org
(END) Dow Jones Newswires
November 09, 2017 08:40 ET (13:40 GMT)