AstraZeneca prepares to defend Exanta failures

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The Independent Online

AstraZeneca, the UK's number two drug company, is set to strike a defiant note today over the prospects for its revolutionary new anti-clotting drug, despite its rejection by a regulatory panel in the US last month.

AstraZeneca, the UK's number two drug company, is set to strike a defiant note today over the prospects for its revolutionary new anti-clotting drug, despite its rejection by a regulatory panel in the US last month.

The company's defence of Exanta will be among the most closely examined parts of the company's "annual business review" for the investment community. The pill had been expected to be a major plank in the company's strategy of returning to growth after patent expiries earlier in the decade wiped out sales of older drugs.

Sir Tom McKillop, the chief executive, is expected to insist that Exanta can be approved for use, despite concerns that it causes liver problems. A panel of US doctors concluded the pill was too dangerous to allow on the market. It is rare for the US regulator, the Food & Drug Administration (FDA), to go against the advice of its panels, but AstraZeneca is in talks with the agency to examine what needs to be done to gain approval.

AstraZeneca was shocked by the result of the panel hearing, aggrieved at the manner in which it was chaired, and suspicious of the statistical analysis presented by FDA staff. Although there will be no impolitic criticism of the FDA in today's public presentations, they are likely to argue that Exanta was turned down in part because of the sheer demand from the medical profession for an alternative to the existing blood-thinner, warfarin, which is 60 years old.

Analysts say the company needs to dispel suggestions that Exanta's failure might signal a problem over its relationship with the FDA. Sir Tom is likely to try to re-establish the company's reputation by pointing to the success of Nexium, an ulcer pill that analysts were initially sceptical would make significant sales, and the growing market for Iressa, a lung cancer product where there were initially severe concerns over side effects.

He will also aim to shift the spotlight to AstraZeneca's other recently launched drugs, including Seroquel for schizophrenia and Symbicort for lung disease. Comments on Crestor, an anti-cholesterol pill which has so far proved disappointing, will also be examined closely for any hint that the company is backing away from its target of winning a 20 per cent global market share for the drug.

Stewart Adkins, the pharmaceuticals sector analyst at Lehman Brothers, said: "Following the negative FDA panel decision for Exanta, the business review day provides investors with the first opportunity to hear management's side of the story.... Can management revitalise the AstraZeneca story in the eyes of investors? In our view, this will be difficult, given that the next major US drug launch is not expected until 2006."

AstraZeneca has presentations today on several of its recently launched drugs and also on emerging markets where it is interested in expanding, including China.

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