AstraZeneca blames customer cut backs for disappointing results

The Anglo-Swedish pharmaceutical group AstraZeneca posted what analysts considered to be disappointing first-quarter sales figures yesterday, but said that its full-year earnings growth was on track to meet expectations.

The company blamed customers cutting back on stocks of drugs in the first quarter as the main reason for the numbers, which showed 10 per cent sales growth, below forecasts. The group manufacturers Nexium, the blockbuster ulcer treatment, which had faced a patent challenge from the Indian generics company Ranbaxy that was resolved in AstraZeneca's favour last week.

Analysts expected that Nexium sales growth would be slower, but were mystified why other drugs had also been de-stocked. Simon Louth, AstraZeneca's chief financial officer, said there was "no particular reason".

First-quarter, pre-tax profits were up 12 per cent to $2.65bn (£1.34bn), although this figure did not include restructuring costs associated with the buyout of the biotechnology group MedImmune. Shares in the company fell by 5 per cent on the announcement, with analysts blaming a misunderstanding of the figures. The group has said that due to beneficial movements in the dollar, earnings per share growth had increased by 5 cents.

Peter Cartwright, an analyst at Evolution, said that most investors had assumed that the growth increase had been worked out by taking a set dollar price for the whole year, when in fact it is worked out by the company on a quarterly basis. Shares had recovered to 2,120p by the close of trading, down 0.6 per cent, with investors assuming that the 5 cent figure will improve during the year.

Despite the group maintaining that it will hit annual sales targets, Simon Mather, a pharmaceutical industry watcher at WestLB, said the company would come under pressure in the next year, particularly from generics groups.

The patents of Seroquel, the company's psychiatric treatment, and Crestor, an anti-cholesterol drug, face challenges in the next 18 months. Mr Louth said he would vigorously defend its intellectual property rights.

Seroquel recorded sales of $1.05bn in the first quarter, up from $923m last year, while Crestor made $772m against $628m in 2006.

Mr Louth also refused to rule out a move away from the UK. Last week, one of AstraZeneca's rivals, Shire, said it was to re-domicile in the Republic of Ireland to take advantage of the country's 12.5 per cent corporate tax rate. UK corporate tax is charged at 28 per cent.

Start your day with The Independent, sign up for daily news emails
Voices
Barn owls are among species that could be affected
charity appeal
News
Sarah Silverman (middle) with sister Reform Rabbi Susan Silverman (right) and sister actress Laura Silverman (left) at Jerusalem's Western Wall for feminist Hanuka candle-lighting ceremony
peopleControversial comedian stages pro-equality Hanukkah lighting during a protest at Jerusalem's Wailing Wall
Arts and Entertainment
The Bach Choir has been crowned the inaugural winner of Sky Arts’ show The Great Culture Quiz
arts + ents140-year-old choir declared winner of Sky Arts' 'The Great Culture Quiz'
Sport
After another poor series in Sri Lanka, Alastair Cook claimed all players go through a lean period
cricketEoin Morgan reportedly to take over ODI captaincy
PROMOTED VIDEO
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Carlton Senior Appointments: Private Banking Manager - Intl Bank - Los Angeles

$200 - $350 per annum: Carlton Senior Appointments: Managing Producer – Office...

Carlton Senior Appointments: San Fran - Investment Advisor – Ind Advisory Firm

$125 - $225 per annum: Carlton Senior Appointments: San Fran - Investment Advi...

Sheridan Maine: Commercial Finance Manager

Up to £70,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...

Sheridan Maine: Regulatory Reporting Accountant

Up to £65,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...

Day In a Page

Homeless Veterans appeal: 'You look for someone who's an inspiration and try to be like them'

Homeless Veterans appeal

In 2010, Sgt Gary Jamieson stepped on an IED in Afghanistan and lost his legs and an arm. He reveals what, and who, helped him to make a remarkable recovery
Could cannabis oil reverse the effects of cancer?

Could cannabis oil reverse effects of cancer?

As a film following six patients receiving the controversial treatment is released, Kate Hilpern uncovers a very slippery issue
The Interview movie review: You can't see Seth Rogen and James Franco's Kim Jong Un assassination film, but you can read about it here

The Interview movie review

You can't see Seth Rogen and James Franco's Kim Jong Un assassination film, but you can read about it here
Serial mania has propelled podcasts into the cultural mainstream

How podcasts became mainstream

People have consumed gripping armchair investigation Serial with a relish typically reserved for box-set binges
Jesus Christ has become an unlikely pin-up for hipster marketing companies

Jesus Christ has become an unlikely pin-up

Kevin Lee Light, aka "Jesus", is the newest client of creative agency Mother while rival agency Anomaly has launched Sexy Jesus, depicting the Messiah in a series of Athena-style poses
Rosetta space mission voted most important scientific breakthrough of 2014

A memorable year for science – if not for mice

The most important scientific breakthroughs of 2014
Christmas cocktails to make you merry: From eggnog to Brown Betty and Rum Bumpo

Christmas cocktails to make you merry

Mulled wine is an essential seasonal treat. But now drinkers are rediscovering other traditional festive tipples. Angela Clutton raises a glass to Christmas cocktails
5 best activity trackers

Fitness technology: 5 best activity trackers

Up the ante in your regimen and change the habits of a lifetime with this wearable tech
Paul Scholes column: It's a little-known fact, but I have played one of the seven dwarves

Paul Scholes column

It's a little-known fact, but I have played one of the seven dwarves
Fifa's travelling circus once again steals limelight from real stars

Fifa's travelling circus once again steals limelight from real stars

Club World Cup kicked into the long grass by the continued farce surrounding Blatter, Garcia, Russia and Qatar
Frank Warren column: 2014 – boxing is back and winning new fans

Frank Warren: Boxing is back and winning new fans

2014 proves it's now one of sport's biggest hitters again
Jeb Bush vs Hillary Clinton: The power dynamics of the two first families

Jeb Bush vs Hillary Clinton

Karen Tumulty explores the power dynamics of the two first families
Stockholm is rivalling Silicon Valley with a hotbed of technology start-ups

Stockholm is rivalling Silicon Valley

The Swedish capital is home to two of the most popular video games in the world, as well as thousands of technology start-ups worth hundreds of millions of pounds – and it's all happened since 2009
Did Japanese workers really get their symbols mixed up and display Santa on a crucifix?

Crucified Santa: Urban myth refuses to die

The story goes that Japanese store workers created a life-size effigy of a smiling "Father Kurisumasu" attached to a facsimile of Our Lord's final instrument of torture
Jennifer Saunders and Kate Moss join David Walliams on set for TV adaptation of The Boy in the Dress

The Boy in the Dress: On set with the stars

Walliams' story about a boy who goes to school in a dress will be shown this Christmas