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AstraZeneca has raised its sales and profit outlook for the year on the back of strong sales of its cancer medicines, as the UK’s largest company nears a £200bn valuation.
Sales of its drugs reached $25.6bn in the first half of the year, up 18 per cent year on year at constant exchange rates and slightly ahead of analysts’ estimates.
The Anglo-Swedish drugmaker now expects revenue and earnings per share to increase by a “mid teens” percentage, compared with previous guidance of lower double-digit growth.
Shares in the £188bn company have risen more than 12 per cent this year, with successful drug launches and acquisitions under long-serving leader Pascal Soriot helping AstraZeneca near a £200bn market capitalisation, which would be a first for a FTSE company.
The new guidance comes after the company outlined plans in May to reach $80bn in revenue by 2030. The outlook upgrade was broadly expected by analysts. Shares fell 2.4 per cent in early trading on Thursday.
“This is a clear reflection of the substantial growth potential we see from both our approved medicines and those in our late-stage pipeline,” said Soriot.
On Thursday, the company reported strong growth across all its divisions, with a 22 per cent rise in sales of its oncology drugs, which account for 41 per cent of the total.
In a bid to expand the use of its cancer medicines, AstraZeneca presented a string of scientific data at the American Society of Clinical Oncology cancer conference in Chicago in June.
This included presentations on Tagrisso and Imfinzi, its best-selling cancer drugs, which delivered $3.2bn and $2.3bn in revenue in the first half of the year, respectively.
The company faces patent expiries on some of its key products, including that of high-selling diabetes drug Farxiga in 2025, while the fickle nature of drug development and clinical trial results could also hit its valuation.
But the drugmaker is less exposed than some big pharmaceutical groups to loss of exclusivity on key medicines, said Sean Conroy, an analyst at Shore Capital. “They’ve got enough coming down the pipeline to give me confidence that they’ll get to $80bn and be able to stay there,” he told the Financial Times.
It is also expected to announce early data on an anti-obesity pill it acquired through a licensing deal with Chinese biotech Eccogene last year, although it lags behind rivals Novo Nordisk and Eli Lilly in the booming sector.