AstraZeneca lifts 2024 revenue and profit forecast after Q3 beat

By Yadarisa Shabong and Maggie Fick

(Reuters) - Drugmaker AstraZeneca (NASDAQ:AZN ) lifted its annual sales and profit forecast for the second time this year on Tuesday, helped by strong demand for its cancer and rare diseases medicines, after third-quarter results beat estimates.

The London-listed company doubled down on the United States, announcing $2 billion in new spending on research and development and manufacturing plants, bringing the total it will invest to expand its footprint in the country to $3.5 billion by the end of 2026. Some $2 billion of that investment, announced for the first time on Tuesday, will expand manufacturing facilities in Maryland, Texas and in California, it said.

"Our multibillion dollar investment reflects the attractiveness of the business environment together with the quality of talent and innovation capabilities here in the United States," CEO Pascal Soriot said in a statement the week after Donald Trump won the U.S. election.

AstraZeneca now expects 2024 revenue and core earnings per share to grow by a high-teens percentage, from a previous forecast of a mid-teens percentage at constant currency rates for both revenue and EPS.

Shares rose 2% in early trading before reversing course. They were down 0.4% at 0828 GMT. Shares have fallen about 17% in the past three months, reflecting market unease with the company's business in China amid multiple investigations by national authorities. Its shares are down nearly 6% this year, underperforming a near 9% rise in the wider European health care sector.

Last week, the company said its China president Leon Wang had been detained by Chinese authorities and it did not know why.

"We take the matters in China very seriously," Soriot said.

AstraZeneca said last week its Chief Financial Officer Aradhana Sarin had briefed sell-side analysts on the subject on Nov.6 to quell concerns about a fraud probe expanding following a report by financial media company Yicai a day earlier that led its shares to plunge more than 8%.

The company has invested heavily in China, the world's second-largest pharmaceuticals market after the U.S., with the local business contributing 13% of group revenue last year.

AstraZeneca reiterated on Tuesday that it has not received notification from Chinese authorities that the company itself is under investigation but if requested, will cooperate with the Chinese authorities.

Revenue in China in third quarter came in at $1.7 billion, up from $1.5 billion in the same quarter last year, representing growth of 15% at constant exchange rates. U.S. revenue in the quarter was $6 billion, representing growth of 23% at constant exchange rates.



AstraZeneca also said on Tuesday, along with its partner Daiichi Sankyo, it has submitted a new biologics license application for the accelerated approval in the U.S. for its experimental precision drug, datopotamab deruxtecan, for the treatment of adult patients with a type of non-small cell lung cancer who have received prior therapies.

Analysts and investors saw that new application as positive, saying it increases the chance of approval of the medicine for that patient group.

Source: Investing.com