REG - AstraZeneca PLC - 3rd Quarter Results <Origin Href="QuoteRef">AZN.L</Origin> - Part 3
06/11/2014 08:42
- Part 3: For the preceding part double click ID:nRSF2925Wb
loans, and $380 million of derivatives as at 30 September 2014. The
total fair value of interest-bearing loans and borrowings at 30 September 2014, which have a carrying value of $9,926
million in the Condensed Consolidated Statement of Financial Position, was $11,013 million. Contingent consideration
liabilities arising on the Company's acquisitions of business combinations have been classified under Level 3 in the fair
value hierarchy and movements in fair value are shown below:
2014
$m
At 1 January 514
Acquisitions 5,169
Settlements (572)
Revaluations 6
Discounting 277
Foreign exchange (3)
At 30 September 5,391
For all other financial instruments which are carried at amortised cost, amortised cost approximates to fair value.
7 legal proceedings and contingent liabilities
AstraZeneca is involved in various legal proceedings considered typical to its business, including litigation and
investigations relating to product liability, commercial disputes, infringement of intellectual property rights, the
validity of certain patents, anti-trust law and sales and marketing practices. The matters discussed below constitute the
more significant developments since publication of the disclosures concerning legal proceedings in the Company's Annual
Report and Form 20-F Information 2013 and Interim Management Statement 2014 as part of the Company's Half-Yearly Financial
Report for the six-month period to 30 June 2014 (the Disclosures). Unless noted otherwise below or in the Disclosures, no
provisions have been established in respect of the claims discussed below.
As discussed in the Company's Annual Report and Form 20-F Information 2013, for the majority of claims in which AstraZeneca
is involved it is not possible to make a reasonable estimate of the expected financial effect, if any, that will result
from ultimate resolution of the proceedings. In these cases, AstraZeneca discloses information with respect only to the
nature and facts of the cases but no provision is made.
In cases that have been settled or adjudicated, or where quantifiable fines and penalties have been assessed and which are
not subject to appeal, or where a loss is probable and we are able to make a reasonable estimate of the loss, we record the
loss absorbed or make a provision for our best estimate of the expected loss.
The position could change over time and the estimates that we have made and upon which we have relied in calculating these
provisions are inherently imprecise. There can, therefore, be no assurance that any losses that result from the outcome of
any legal proceedings will not exceed the amount of the provisions that have been booked in the accounts. The major factors
causing this uncertainty are described more fully in the Company's Annual Report and Form 20-F Information 2013 and
herein.
AstraZeneca has full confidence in, and will vigorously defend and enforce, its intellectual property.
Matters disclosed in respect of the third quarter of 2014 and to 6 November 2014
Patent litigation
Byetta (exenatide)
Patent proceedings in the US
In October 2014, AstraZeneca received a Paragraph IV notice from Teva Pharmaceuticals USA, Inc. (Teva) alleging certain
patents listed in the FDA Orange Book with reference to Byetta (exenatide) are invalid, unenforceable and/or not infringed
by Teva's proposed generic product. Teva has filed an Abbreviated New Drug Application (ANDA) seeking to market
300mcg/1.2mL and 600mcg/2.4mL (250mcg/mL) exenatide for injection. AstraZeneca is reviewing Teva's notice.
Crestor (rosuvastatin calcium)
Patent proceedings outside the US
As previously disclosed, in Australia in 2011 and 2012, AstraZeneca instituted proceedings against Apotex Pty Ltd, Watson
Pharma Pty Ltd. and Actavis Australia Pty Ltd. asserting infringement of various formulation and method patents for
Crestor. In March 2013, the Federal Court of Australia held all three patents at issue invalid. AstraZeneca appealed in
relation to two patents. On 12 August 2014, the Full Court of the Federal Court of Australia held the two patents invalid.
AstraZeneca has sought leave to appeal to the High Court in relation to one method patent.
Faslodex (fulvestrant)
Patent proceedings in the US
As previously disclosed, in June 2014, AstraZeneca filed a patent infringement lawsuit against Sandoz Inc. and Sandoz
International GmbH in the US District Court in New Jersey relating to four patents listed in the FDA Orange Book with
reference to Faslodex. In September 2014, AstraZeneca filed two similar lawsuits against Sagent Pharmaceuticals, Inc.
relating to the same four patents in US District Courts in New Jersey and Illinois.
Nexium (esomeprazole magnesium)
Patent proceedings in the US
In October 2014, AstraZeneca received a Paragraph IV Notice from Actavis Laboratories FL, Inc. (Actavis) alleging certain
patents listed in the FDA Orange Book with reference to Nexium24HR are invalid, unenforceable and/or not infringed by
Actavis' proposed generic product. Actavis has filed an Abbreviated New Drug Application (ANDA) seeking to market 20mg
esomeprazole magnesium over the counter. AstraZeneca is reviewing Actavis' notice.
In October 2014, AstraZeneca received a Paragraph IV Notice from Aurobindo Pharma Limited (Aurobindo) alleging US Patent
No. 6,143,771 is invalid, unenforceable and/or not infringed by Aurobindo's proposed generic product. Aurobindo has filed
an ANDA seeking to market 20mg/vial and 40mg/vial esomeprazole sodium for injection. AstraZeneca is reviewing Aurobindo's
notice.
Patent proceedings outside the US
As previously disclosed, in Canada, patent infringement proceedings against Apotex Inc. continue. On 2 July 2014, the
Federal Court found Canadian Patent No. 2,139,653 invalid. AstraZeneca has appealed.
In Canada, on 14 July 2014, AstraZeneca received a Notice of Allegation from Teva Canada Limited (Teva) alleging either
that Teva's esomeprazole magnesium product would not infringe the patents listed on the Canadian Patent Register in
relation to Nexium or, alternatively, that certain of the patents were invalid. AstraZeneca has commenced an application
in response.
Pulmicort Respules (budesonide inhalation suspension)
Patent proceedings in the US
As previously disclosed, in December 2013, the US District Court for the District of New Jersey temporarily enjoined the
generic defendants from entering the market until resolution of AstraZeneca's motion for a preliminary injunction. On 6
October 2014, the Court commenced a hearing on the preliminary injunction motion as well as a trial on the merits in
respect of US Patent No. 7,524,834.
Seroquel XR (quetiapine fumarate)
Patent proceedings in the US
In September 2014, AstraZeneca received a Paragraph IV Notice from Pharmadax, Inc. and Pharmadax USA, Inc. (collectively,
Pharmadax) alleging that the patent listed in the FDA Orange Book with reference to Seroquel XR is invalid, unenforceable
and/or is not infringed by the Pharmadax proposed generic product. Pharmadax has submitted an Abbreviated New Drug
Application (ANDA) seeking to market quetiapine fumarate 150, 200, 300 and 400mg tablets. In October 2014, AstraZeneca
filed a patent infringement lawsuit against Pharmadax and Pharmadax (Guangzhou) Inc. in the US District Court for the
District of New Jersey. In October 2014, AstraZeneca also filed a similar patent infringement suit against the same
parties in the US District Court for the Central District of California Southern Division.
Product liability litigation
Crestor (rosuvastatin calcium)
As previously disclosed, AstraZeneca is defending a number of lawsuits alleging multiple types of injuries caused by the
use of Crestor, including diabetes mellitus, various cardiac injuries, rhabdomyolysis, and/or liver and kidney injuries.
The claims of 571 plaintiffs, comprising 101 California residents and 470 non-California residents, were aggregated in one
coordinated proceeding in Los Angeles, California. The claims of additional plaintiffs are waiting to be added to the
coordination. In October 2014, the coordination judge dismissed the claims of the 470 non-California plaintiffs whose
claims were in the coordinated proceeding. Those plaintiffs may or may not refile their claims in an appropriate venue.
There are now a total of 729 plaintiffs remaining with claims pending in California state court.
Nexium (esomeprazole magnesium)
As previously disclosed, AstraZeneca has been defending federal Multi-District Litigation (MDL) against plaintiffs who
allege that Nexium caused bone deterioration, loss of bone density and/or bone fractures. On 1 October 2014, the MDL court
granted AstraZeneca's motion for summary judgment as to approximately 270 claims that remained pending in the MDL and
entered judgment in AstraZeneca's favour. Of the more than 1,910 plaintiffs who have filed claims against AstraZeneca
alleging Nexium caused bone-related injuries, fewer than 40 plaintiffs' claims remain active and the rest have been
dismissed. All of the remaining active claims are pending in California state court.
Commercial litigation
Nexium settlement anti-trust litigation
As previously disclosed, AstraZeneca is one of several defendants in a Multi-District Litigation class action and
individual lawsuits alleging that AstraZeneca's settlements of certain patent litigation in the US relating to Nexium
violated US anti-trust law and various state laws. A trial commenced on 20 October 2014 on certain liability issues for
claims that remain in the case.
On 31 July 2014, the US Court of Appeals heard oral argument on AstraZeneca's appeal of the District Court's procedural
decision to certify a class action of end payers. The Appeals Court has not issued a decision.
In October 2014, the US District Court for the District of Pennsylvania granted plaintiffs' motion to remand an indirect
purchaser opt-out case to the Pennsylvania Court of Common Pleas. Another indirect purchase opt-out case was transferred
to the District of Massachusetts for consideration. No schedule has been set in either of the opt-out cases.
Seroquel IR and Seroquel XR (quetiapine fumarate)
In October 2014, following a previously disclosed investigation by the State of Texas into AstraZeneca's sales and
marketing activities involving Seroquel, the Texas Attorney General's Office intervened in a state whistleblower action
pending in Travis County Court, Texas. The lawsuit alleges that AstraZeneca engaged in inappropriate promotion of Seroquel
and made improper payments intended to influence the formulary status of Seroquel in violation of the Texas Medicaid Fraud
Prevention Act and Texas common law.
Other Commercial litigation
Medco qui tam litigation (Schumann)
As previously disclosed, AstraZeneca had been named as a defendant in a lawsuit filed in the Federal Court in Philadelphia
under the qui tam (whistleblower) provisions of the federal and certain state False Claims Acts alleging overpayments by
federal and state governments resulting from alleged false pricing information reported to the government and alleged
improper payments intended to influence the formulary status of Prilosec and Nexium to Medco and its customers. In January
2013, the Court granted AstraZeneca's motion and dismissed the case with prejudice. The plaintiff appealed. In October
2014, the US Court of Appeals for the Third Circuit affirmed the lower court's decision to dismiss AstraZeneca from the
litigation with prejudice.
Government investigations
Brilinta (ticagrelor)
In August 2014, AstraZeneca announced that it had received confirmation from the US Department of Justice that it was
closing its investigation regarding PLATO, a clinical trial. AstraZeneca understands that the US Government is not planning
any further action.
8 NINE MONTHS PRODUCT REVENUE ANALYSIS
World US Europe Established ROW Emerging Markets
9M 2014$m CER% 9M 2014$m CER 9M 2014$m CER% 9M 2014$m CER% 9M 2014$m CER%
%
Cardiovascular and Metabolic disease:
Crestor 4,124 - 2,158 1 914 (4) 503 (10) 549 11
Seloken/Toprol-XL 584 3 76 (32) 94 (5) 15 - 399 17
Onglyza 620 118 380 88 111 161 42 214 87 221
Atacand 384 (19) 33 (47) 133 (25) 34 (36) 184 2
Brilinta/Brilique 343 78 103 110 171 47 24 136 45 142
Byetta 258 69 160 38 61 132 20 200 17 350
Bydureon 317 210 271 198 39 236 4 100 3 100
Plendil 190 (2) - - 14 (7) 8 14 168 (2)
Tenormin 121 (18) 6 (50) 37 (5) 42 (22) 36 (14)
Others 387 39 124 254 144 6 22 16 97 9
Total Cardiovascular and Metabolic disease 7,328 12 3,311 18 1,718 7 714 (4) 1,585 16
Oncology:
Zoladex 697 (4) 18 - 174 (14) 239 (7) 266 5
Iressa 473 (1) - - 124 (9) 134 (3) 215 4
Faslodex 538 8 250 5 187 11 44 4 57 17
Arimidex 230 (11) 12 500 60 (18) 81 (25) 77 5
Casodex 246 (9) 5 67 32 (23) 129 (17) 80 16
Others 103 4 20 11 25 20 32 (19) 26 27
Total Oncology 2,287 (2) 305 10 602 (6) 659 (11) 721 8
Respiratory, Inflammation and Autoimmunity:
Symbicort 2,823 12 1,116 26 1,115 (3) 337 23 255 21
Pulmicort 677 10 155 (6) 121 (8) 69 (5) 332 33
Others 227 (6) 22 (48) 84 (6) 21 (13) 100 14
Total Respiratory, Inflammation and Autoimmunity 3,727 11 1,293 19 1,320 (4) 427 16 687 25
Infection, Neuroscience and Gastrointestinal:
Nexium 2,823 - 1,407 (11) 279 1 501 25 636 9
Synagis 496 (9) 265 (16) 231 1 - - - -
Seroquel XR 915 (9) 542 (1) 264 (18) 34 (39) 75 3
Seroquel IR 206 (32) 20 900 69 (19) 23 (78) 94 (16)
Local Anaesthetics 371 1 - - 152 (4) 125 - 94 11
Losec/Prilosec 312 (13) 20 (13) 99 1 80 (31) 113 (6)
Merrem 190 (9) 7 (22) 25 (37) 3 (40) 155 (1)
FluMist/Fluenz 161 (18) 143 (19) 16 (6) 2 - - -
Others 596 (7) 166 (25) 150 (2) 91 2 189 5
Total Infection, Neuroscience and Gastrointestinal 6,070 (6) 2,570 (11) 1,285 (7) 859 (4) 1,356 4
Total 19,412 4 7,479 6 4,925 (2) 2,659 (3) 4,349 12
9 THIRD QUARTER PRODUCT REVENUE ANALYSIS
World US Europe Established ROW Emerging Markets
Q3 2014$m CER% Q3 2014$m CER Q3 2014$m CER% Q3 2014$m CER% Q3 2014$m CER%
%
Cardiovascular and Metabolic disease:
Crestor 1,342 (1) 682 (5) 303 1 165 - 192 13
Seloken/Toprol-XL 198 14 23 (8) 31 - 5 50 139 22
Onglyza 220 139 130 106 42 193 15 220 33 230
Atacand 123 (13) 13 18 37 (31) 12 (14) 61 (3)
Brilinta/Brilique 127 68 40 122 61 36 10 100 16 100
Byetta 92 64 55 45 21 67 8 133 8 233
Bydureon 125 191 107 189 15 133 1 100 2 100
Plendil 68 5 - - 4 (20) 4 300 60 2
Tenormin 40 (22) 2 (60) 12 (8) 13 (32) 13 (7)
Others 160 56 65 442 52 (4) 4 (43) 39 31
Total Cardiovascular and Metabolic disease 2,495 16 1,117 20 578 8 237 7 563 20
Oncology:
Zoladex 240 (2) 7 17 57 (10) 83 (6) 93 6
Iressa 157 (4) - - 40 (7) 45 (8) 72 -
Faslodex 187 11 89 7 64 17 16 - 18 19
Arimidex 74 (16) 3 (25) 19 (17) 26 (27) 26 4
Casodex 80 (12) 2 - 10 (23) 41 (22) 27 17
Others 37 15 7 40 9 14 13 (7) 8 43
Total Oncology 775 (2) 108 8 199 (3) 224 (12) 244 7
Respiratory, Inflammation and Autoimmunity:
Symbicort 967 15 395 29 358 (1) 126 18 88 28
Pulmicort 205 17 51 9 32 (6) 22 (4) 100 40
Others 72 (10) 5 (64) 25 - 10 (25) 32 14
Total Respiratory, Inflammation and Autoimmunity 1,244 14 451 23 415 (1) 158 11 220 30
Infection, Neuroscience and Gastrointestinal:
Nexium 922 1 468 (7) 85 (1) 166 17 203 10
Synagis 121 (7) 6 - 115 (7) - - - -
Seroquel XR 319 (6) 195 1 83 (22) 14 (7) 27 8
Seroquel IR 51 (37) (6) n/m 22 (16) 2 (93) 33 6
Local Anaesthetics 122 2 - - 46 (6) 45 5 31 10
Losec/Prilosec 97 (17) 6 (14) 32 7 26 (32) 33 (21)
Merrem 60 (10) 1 (80) 9 (18) 1 (50) 49 -
FluMist/Fluenz 149 (21) 133 (22) 16 (6) - (100) - -
Others 187 (20) 49 (42) 48 (4) 25 (6) 65 (12)
Total Infection, Neuroscience and Gastrointestinal 2,028 (7) 852 (12) 456 (9) 279 (5) 441 2
Total 6,542 5 2,528 7 1,648 (1) 898 (2) 1,468 13
Shareholder Information
ANNOUNCEMENTS AND MEETINGS
______________________________________________________________________________________________________________________________________________________________________________________________________________________________
Announcement of fourth quarter and full year 2014 results 5 February 2015
Announcement of first quarter 2015 results 24 April 2015
Annual General Meeting 24 April 2015
Announcement of second quarter and half year 2015 results 30 July 2015
Announcement of third quarter and nine months 2015 results 5 November 2015
DIVIDENDS
______________________________________________________________________________________________________________________________________________________________________________________________________________________________
The record date for the first interim dividend, paid on 15 September 2014, was 15 August 2014. Shares traded ex-dividend
from 13 August 2014.
The record date for the second interim dividend for 2014, payable on 23 March 2015, will be 20 February 2015. Ordinary
Shares listed in London and Stockholm will trade ex-dividend from 19 February 2015. American Depositary Shares listed in
New York will trade ex-dividend from 18 February 2015.
Future dividends will normally be paid as follows:
First interim Announced with second quarter and half year results and paid in September
Second interim Announced with fourth quarter and full year results and paid in March
The Company expects to change depositary bank for its US American Depositary Receipt (ADR) Programme to Citibank, N.A.
during December 2014.
TRADEMARKS
______________________________________________________________________________________________________________________________________________________________________________________________________________________________
Trademarks of the AstraZeneca group of companies and of companies other than AstraZeneca appear throughout this document in
italics. AstraZeneca, the AstraZeneca logotype and the AstraZeneca symbol are all trademarks of the AstraZeneca group of
companies. Trademarks of companies other than AstraZeneca that appear in this document include Duaklir Genuair and Eklira,
trademarks of Almirall, S.A. and Imbruvica, a trademark of Pharmacyclics, Inc.
ADDRESSES FOR CORRESPONDENCE
______________________________________________________________________________________________________________________________________________________________________________________________________________________________
Registrar andTransfer OfficeEquiniti LimitedAspect HouseSpencer RoadLancingWest SussexBN99 6DAUK US DepositaryJP Morgan Chase & CoPO Box 64504St PaulMN 55164-0504US Registered Office2 Kingdom StreetLondonW2 6BDUK Swedish Central Securities DepositoryEuroclear Sweden ABPO Box 191SE-101 23 StockholmSweden
Tel (freephone in UK): Tel (toll free in US): 888 697 8018Tel (outside US): +1 651 453 2128 Tel: +44 (0) 20 7604 8000 Tel: +46 (0)8 402 9000
0800 389 1580Tel (outside UK):
+44 (0)121 415 7033
CONTACT INFORMATION
______________________________________________________________________________________________________________________________________________________________________________________________________________________________
Media Enquiries: Esra Erkal-Paler (London) +44 (0) 20 7604 8030
Vanessa Rhodes (London) +44 (0) 20 7604 8037
Ayesha Bharmal (London) +44 (0) 20 7604 8034
Jacob Lund (Södertälje) +46 (0) 8 553 260 20
Analyst/Investor Enquiries: Thomas Kudsk Larsen (London) +44 (0) 20 7604 8199
Karl Hård (London) +44 (0) 20 7604 8123
Anthony Brown (London) +44 (0) 20 7604 8067
Jens Lindberg (London) +44 (0) 7557 319729
Eugenia Litz (London) +44 (0) 20 7604 8233
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
______________________________________________________________________________________________________________________________________________________________________________________________________________________________
In order, among other things, to utilise the 'safe harbour' provisions of the US Private Securities Litigation Reform Act
1995, we are providing the following cautionary statement: The interim financial statements contain certain forward-looking
statements with respect to the operations, performance and financial condition of the Group. Although we believe our
expectations are based on reasonable assumptions, any forward-looking statements, by their very nature, involve risks and
uncertainties and may be influenced by factors that could cause actual outcomes and results to be materially different from
those predicted. The forward-looking statements reflect knowledge and information available at the date of preparation of
the interim financial statements and AstraZeneca undertakes no obligation to update these forward-looking statements. We
identify the forward-looking statements by using the words 'anticipates', 'believes', 'expects', 'intends' and similar
expressions in such statements. Important factors that could cause actual results to differ materially from those contained
in forward-looking statements, certain of which are beyond our control, include, among other things: the loss or expiration
of patents, marketing exclusivity or trademarks, or the risk of failure to obtain patent protection; the risk of
substantial adverse litigation/government investigation claims and insufficient insurance coverage; exchange rate
fluctuations; the risk that R&D will not yield new products that achieve commercial success; the risk that strategic
alliances and acquisitions will be unsuccessful; the impact of competition, price controls and price reductions; taxation
risks; the risk of substantial product liability claims; the impact of any delays in the manufacturing, distribution and
sale of any of our products; the impact of any failure by third parties to supply materials or services; the risk of
failure to manage a crisis; the risk of failure of information technology and cybercrime; the risk of delay to new product
launches; the difficulties of obtaining and maintaining regulatory approvals for products; the risk of failure to observe
ongoing regulatory oversight; the risk that new products do not perform as we expect; the risk of environmental
liabilities; the risks associated with conducting business in emerging markets; the risk of reputational damage; the risk
of product counterfeiting; the risk of failure to successfully implement planned cost reduction measures through
productivity initiatives and restructuring programmes; the risk that regulatory approval processes for biosimilars could
have an adverse effect on future commercial prospects; the impact of failing to attract and retain key personnel and to
successfully engage with our employees; and the impact of increasing implementation and enforcement of more stringent
anti-bribery and anti-corruption legislation.
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