REG - AstraZeneca PLC - 9M and Q3 2023 results
09/11/2023 07:15
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RNS Number : 8657S AstraZeneca PLC 09 November 2023
AstraZeneca
9 November 2023
9M and Q3 2023 results
Strong momentum in the year to date leads to increased guidance for Total
Revenue ex COVID-19 medicines and Core EPS
Revenue and EPS summary
9M 2023 Q3 2023
% Change % Change
$m Actual CER 1 (#_ftn1) $m Actual CER
- Product Sales 32,466 1 4 11,018 4 5
- Alliance Revenue 2 (#_ftn2) 1,004 99 99 377 76 75
- Collaboration Revenue 317 (28) (28) 97 (46) (47)
Total Revenue 33,787 2 5 11,492 5 6
Total Revenue ex COVID-19 33,453 12 15 11,492 12 13
Reported 3 (#_ftn3) EPS 4 (#_ftn4) $3.22 >2x >2x $0.89 (16) (6)
Core 5 (#_ftn5) EPS $5.80 10 17 $1.73 4 9
Financial performance (9M 2023 figures unless otherwise stated, growth numbers at CER)
‒ Total Revenue $33,787m, up 5% despite a decline of $2,896m from
COVID-19 medicines 6 (#_ftn6)
‒ Excluding COVID-19 medicines, both Total Revenue and Product Sales
increased 15%
‒ Total Revenue from Oncology medicines increased 20%, CVRM 7
(#_ftn7) 19%, R&I 8 (#_ftn8) 9%, and Rare Disease 12%
‒ Core Product Sales Gross Margin 9 (#_ftn9) of 82%, up two
percentage points, reflecting the decline in sales of lower margin COVID‑19
medicines
‒ Core Operating Margin of 35% increased by three percentage points
including the previously-announced gain from an update to the contractual
relationships for Beyfortus, totalling $712m and recorded in Core Other
operating income
‒ Core EPS increased 17% to $5.80
‒ FY 2023 Total Revenue excluding COVID-19 medicines now expected to
increase by a low-teens percentage at CER
‒ FY 2023 Core EPS now expected to increase by a low double-digit to
low-teens percentage at CER
Pascal Soriot, Chief Executive Officer, AstraZeneca, said:
"Our company continued its strong growth trajectory in the third quarter with
Total Revenue from our non‑COVID-19 medicines up 13% compared to last year.
We initiated several Phase III trials of high-potential molecules this
quarter, including for volrustomig, our PD‑1/CTLA-4 10 (#_ftn10) bispecific
antibody. Our portfolio of bispecifics has the potential to replace the
first-generation checkpoint inhibitors across a range of cancers. We also
initiated a fixed dose combination study of zibotentan with Farxiga which has
the potential to significantly improve outcomes for patients with kidney
disease not well controlled on current standard of care.
I am excited about the acceleration of our cardiometabolic and obesity
pipeline with today's licensing agreement for ECC5004, a potential
best-in-class, oral GLP-1RA 11 (#_ftn11) . This molecule could offer an
important advance, as both a monotherapy and in combinations, for the
estimated one billion people living with cardiometabolic diseases such as
type-2 diabetes and obesity.
Given the momentum in the year to date we have increased our full-year
guidance for Total Revenue excluding COVID medicines as well as for Core
EPS."
Key milestones achieved since the prior results announcement
‒ Key positive read-outs: datopotamab deruxtecan in metastatic HR 12
(#_ftn12) -positive breast cancer (TROPION‑Breast01); Imfinzi in liver
cancer (EMERALD-1); Fasenra in EGPA 13 (#_ftn13) (MANDARA)
‒ Key regulatory approvals: EU approval for Enhertu in HER2 14
(#_ftn14) -mutant lung cancer (DESTINY‑Lung02); China approvals for Forxiga
in heart failure regardless of ejection fraction (DELIVER); Calquence in
r/rCLL 15 (#_ftn15) (ASCEND); Soliris in NMOSD 16 (#_ftn16) . Japan
approvals for Lynparza in prostate cancer (PROpel); Enhertu in HER2-mutant
lung cancer (DESTINY-Lung02)
‒ Other milestones: Tagrisso granted US Breakthrough Therapy
Designation and US Priority Review in combination with chemotherapy for
treatment of patients with locally advanced or metastatic EGFRm 17 (#_ftn17)
NSCLC 18 (#_ftn18) (FLAURA2); Enhertu granted US Breakthrough Therapy
Designations in HER2-positive colorectal
cancer (DESTINY-CRC01, DESTINY-CRC02) and multiple types of HER2‑expressing
tumours (DESTINY‑PanTumor02)
Guidance
The Company updates its Total Revenue and Core EPS guidance for FY 2023 at
CER, based on the average foreign exchange rates through 2022.
Total Revenue is expected to increase by a mid single-digit percentage
(previously low-to-mid single-digit).
Excluding COVID-19 medicines, Total Revenue is expected to increase by a
low-teens percentage
(previously low double-digit).
Core EPS is expected to increase by a low double-digit to low-teens percentage
(previously high single-digit to low double-digit).
Other elements of the Income Statement are expected to be broadly in line with
the indications issued in the Company's H1 2023 results announcement.
The Company is unable to provide guidance on a Reported basis because it
cannot reliably forecast material elements of the Reported results, including
any fair value adjustments arising on acquisition-related liabilities,
intangible asset impairment charges and legal settlement provisions. Please
refer to the cautionary statements section regarding forward-looking
statements at the end of this announcement.
Currency impact
If foreign exchange rates for October to December 2023 were to remain at the
average rates seen in September 2023, it is anticipated that FY 2023 Total
Revenue would incur a low single-digit adverse impact versus the performance
at CER, and Core EPS would incur a mid single-digit adverse impact (previously
a low-to-mid single-digit adverse impact).
The Company's foreign exchange rate sensitivity analysis is provided in Table
19.
Table 1: Key elements of Total Revenue performance in Q3 2023
% Change
Revenue type $m Actual CER
Product Sales 11,018 4 5 * Double-digit growth at CER in Oncology, CVRM and Rare Disease
Alliance Revenue 377 76 75 * $266m for Enhertu (Q3 2022: $160m)
* $74m for Tezspire (Q3 2022: $26m)
Collaboration Revenue 97 (46) (47) * $71m for Beyfortus regulatory milestone
Total Revenue 11,492 5 6 * Excluding COVID-19 medicines, Q3 2023 Total Revenue increased by 12% (13%
at CER)
Therapy areas $m Actual % CER %
Oncology 4,664 15 17 * Strong performance across key medicines and regions
* No milestones from Lynparza in the quarter (Q3 2022: $75m)
CVRM( ) 2,687 14 16 * Farxiga up 41%, Lokelma up 30% (31% at CER), roxadustat up 31% (39% CER),
Brilinta declined 2% (1% at CER)
R&I 1,549 3 5 * Fasenra up 10%, Breztri up 66% (69% CER). Saphnelo and Tezspire also
continue to grow rapidly during their launch phase, partially offset by a 12%
decline (10% at CER) in Symbicort following entry of a generic competitor in
the US during the quarter
V&I 19 (#_ftn19) 312 (64) (65) * $nil revenue from COVID-19 mAbs and Vaxzevria in the quarter (Q3 2022:
$536m and $180m respectively)
* Beyfortus $138m, including $50m of Product Sales from product supplied to
Sanofi, $71m of Collaboration Revenue for a regulatory milestone and $17m of
Alliance Revenue for AstraZeneca's share of gross profit outside US
Rare Disease( ) 1,974 13 14 * Ultomiris up 50% (49% at CER), partially offset by decline in Soliris of
13% (12% at CER)
* Strensiq up 20% (21% at CER) and Koselugo up 81% reflecting strong patient
demand
Other Medicines 306 (36) (32) * Nexium generic competition in Japan
Total Revenue 11,492 5 6
Regions inc. COVID-19 $m Actual % CER %
US 4,859 5 4
Emerging Markets 2,964 4 12
- China 1,452 (6) 1
- Ex-China Emerging Markets 1,513 15 25
Europe 2,392 16 9
Established RoW 1,276 (10) (6)
Total Revenue inc. COVID-19 11,492 5 6 · Growth rates impacted by lower sales of COVID‑19 medicines (see table
below)
Regions ex. COVID-19 $m Actual % CER %
US 4,859 12 12
Emerging Markets 2,964 8 16
- China 1,452 (6) 1
- Ex-China Emerging Markets 1,513 25 36
Europe 2,392 23 16
Established RoW 1,276 5 10
Total Revenue ex. COVID-19 11,492 12 13
Table 2: Key elements of financial performance in Q3 2023
Metric Reported Reported change Core Core Comments 20 (#_ftn20)
change
Total Revenue $11,492m 5% Actual 6% CER $11,492m 5% Actual 6% CER * Excluding COVID-19 medicines, Q3 2023 Total Revenue increased by 12%
(13% at CER)
* See Table 1 and the Total Revenue section of this document for further
details
Product Sales Gross Margin 81% +9pp Actual +10pp CER 81% +1pp Actual +1pp CER + Favourable mix of sales from Oncology and Rare Disease medicines
+ No sales of COVID-19 medicines
‒ Increasing mix of products with profit-sharing arrangements, where
AstraZeneca books Product Sales and records an expense in COGS 21 (#_ftn21)
for the profit share due to its partner
* Variations in Product Sales Gross Margin can be expected between
periods due to product seasonality, foreign exchange fluctuations and other
effects
R&D expense $2,584m 5% Actual 4% CER $2,485m 5% Actual 5% CER + Increased investment in the pipeline
* Core R&D-to-Total Revenue ratio of 22%
(Q3 2022: 21%)
* Year-on-year comparisons can be impacted by differences in cost
phasing driven by study starts and execution
SG&A expense $4,800m 12% Actual 12% CER $3,355m 6% Actual 7% CER + Market development for recent launches and pre-launch activities
+ Reported SG&A impacted by increased charges for legal provisions,
including a $425m charge to provisions relating to a legal settlement in Q3
2023 (see Note 6)
* Core SG&A-to-Total Revenue ratio of 29%
(Q3 2022: 29%)
* Year-on-year comparisons can be impacted by differences in cost
phasing
Other operating income (and expense) 22 (#_ftn22) $70m -34% Actual -33% CER $70m -35% Actual -34% CER ‒ Discontinuation of brazikumab development
Operating Margin 17% +6pp Actual +7pp CER 31% Stable at Actual * See Product Sales Gross Margin, expenses and Other operating income and
+1pp CER expense commentary above
Net finance expense $291m -9% Actual -6% CER $223m -12% Actual -7% CER + Higher interest received on cash and short-term investments, broadly
offset by higher rates on floating debt and bond issuances
Tax rate 17% n/m Actual n/m CER 19% +1pp Actual +1pp CER * Variations in the tax rate can be expected between periods
EPS $0.89 -16% Actual -6% CER $1.73 4% Actual 9% CER * Further details of differences between Reported and Core are shown in
Table 14
Table 3: Pipeline highlights since prior results announcement
Event Medicine Indication / Trial Event
Regulatory approvals and other regulatory actions Lynparza mCRPC 23 (#_ftn23) (1st-line) (PROpel) Regulatory approval (JP)
Enhertu HER2m 24 (#_ftn24) NSCLC (2nd-line+) (DESTINY-Lung02) Positive CHMP Opinion (EU), Regulatory approval (EU, JP)
Calquence CLL 25 (#_ftn25) (ASCEND) Regulatory approval (CN)
Forxiga HFpEF 26 (#_ftn26) (DELIVER) Regulatory approval (CN)
Soliris NMOSD Regulatory approval (CN)
Regulatory submissions Tagrisso EGFRm NSCLC (1st-line) (FLAURA2) Regulatory submission (US, EU, CN), Priority Review (US)
or acceptances*
Imfinzi NSCLC (neoadjuvant) (AEGEAN) Regulatory submission (US)
capivasertib HR+/HER2-negative breast cancer (2nd-line) (CAPItello-291) Regulatory submission (CN)
roxadustat Chemotherapy-induced anaemia Regulatory submission (CN)
FluMist Self-administered influenza vaccine Regulatory submission (US)
Major Phase III data readouts and other developments Imfinzi Liver cancer (locoregional) (EMERALD-1) Primary endpoint met
datopotamab deruxtecan HR+/HER2-breast cancer (inoperable and/or metastatic) (TROPION-Breast01) Primary endpoint met
Fasenra EGPA (MANDARA) Primary endpoint met
*US, EU and China regulatory submission denotes filing acceptance
Upcoming pipeline catalysts
For a table of anticipated timings of key trial readouts, please refer to page
2 of the Clinical Trials Appendix, available on
www.astrazeneca.com/investor-relations.html
(https://www.astrazeneca.com/investor-relations.html) .
Other pipeline updates
Ultomiris discontinued plans to deliver subcutaneous administration for adults
with aHUS 27 (#_ftn27) or PNH 28 (#_ftn28) . This decision follows
persistent efforts to reliably secure the availability of the on-body delivery
system.
Table 4: Phase III trials started since 1 January 2023
Medicine Trial name Indication
datopotamab deruxtecan AVANZAR NSCLC (1st-line)
TROPION-Lung07 Non-squamous NSCLC (1st-line)
camizestrant CAMBRIA-1 HR-positive/HER2-negative adjuvant breast cancer
CAMBRIA-2 HR-positive/HER2-negative adjuvant breast cancer
capivasertib CAPItello-292 HR-positive/HER2-negative advanced breast cancer
volrustomig eVOLVE-Cervical High-risk locally advanced cervical cancer
eVOLVE-Lung02 mNSCLC (1st-line) with PD-L1 29 (#_ftn29) <50%
zibo/dapa ZENITH High Proteinuria CKD 30 (#_ftn30) and high proteinuria
Saphnelo DAISY Systemic sclerosis
Tezspire CROSSING Eosinophilic oesophagitis
Breztri LITHOS Mild to moderate asthma
Breztri ATHLOS COPD 31 (#_ftn31)
pMDI 32 (#_ftn32) portfolio HFO1234ze Mucociliary clearance in healthy volunteers
pMDI portfolio HFO1234ze Well-controlled or partially-controlled asthma
tozorakimab MIRANDA Symptomatic COPD
AZD3152 SUPERNOVA COVID-19 prophylaxis
Ultomiris ARTEMIS Cardiac surgery-associated acute kidney injury
Corporate and business development
In September, AstraZeneca and Verge Genomics (Verge) announced a multi-target
collaboration to identify novel drug targets for rare neurodegenerative and
neuromuscular diseases. Verge is a clinical-stage drug discovery company using
artificial intelligence and patient tissue data. Under the terms of the
four-year agreement, Verge will receive up to $42 million, consisting of
upfront fee, equity, and near-term payments, with potential downstream
royalties. AstraZeneca will take an equity position in Verge.
In September, AstraZeneca completed the definitive purchase and licence
agreement for a portfolio of preclinical rare disease gene therapy programmes
and enabling technologies from Pfizer Inc. The agreement has a total
consideration of up to $1bn, plus tiered royalties on sales.
Cellectis
In November, AstraZeneca announced a collaboration and investment agreement
with Cellectis, a clinical-stage biotechnology company, to accelerate the
development of next generation therapeutics in areas of high unmet need,
including oncology, immunology and rare diseases. Under the terms of the
collaboration agreement, AstraZeneca will leverage the Cellectis proprietary
gene editing technologies and manufacturing capabilities, to design novel cell
and gene therapy products, strengthening AstraZeneca's growing offering in
this space. As part of the agreement, 25 genetic targets have been exclusively
reserved for AstraZeneca, from which up to 10 candidate products could be
explored for development.
In Q4 2023, Cellectis will receive an initial payment of $105m from
AstraZeneca, which comprises a $25m upfront cash payment under the terms of a
research collaboration agreement and an $80m equity investment. A further
$140m equity investment is expected to close in early 2024 subject to the
signing of a final binding agreement. Post-closing of this second investment,
AstraZeneca will hold a total equity stake of approximately 44% in Cellectis.
Under the terms of the research collaboration, Cellectis is also eligible to
receive an investigational new drug option fee and development, regulatory and
sales-related milestone payments, ranging from $70m up to $220m, per each of
the 10 candidate products, plus tiered royalties.
Eccogene licence
In November, AstraZeneca and Eccogene entered into an exclusive licence
agreement for ECC5004, an investigational oral once-daily glucagon-like
peptide 1 receptor agonist (GLP-1RA) for the treatment of obesity, type-2
diabetes and other cardiometabolic conditions. Preliminary results from the
Phase I trial have shown a differentiating clinical profile for ECC5004, with
good tolerability and encouraging glucose and body weight reduction across the
dose levels tested compared to placebo.
Under the terms of the agreement, Eccogene will receive an initial upfront
payment of $185m and up to an additional $1.825bn in future clinical,
regulatory, and commercial milestones and tiered royalties. AstraZeneca is
granted exclusive global rights for the development and commercialisation of
ECC5004 for any indication in all territories except China, where Eccogene has
the right to co-develop and co-commercialise alongside AstraZeneca.
Sustainability summary
This quarter AstraZeneca entered into long-term renewable energy partnerships
in the UK and Sweden. The UK agreement will support the transition away from
fossil fuels at Company sites in Macclesfield, Cambridge, Luton and Speke. The
Sweden agreement corresponds to approximately 80 percent of total electricity
needs at both the Company's Gothenburg site and at Södertälje, one of the
world's largest drug manufacturing centres. See the Sustainability section for
further details.
Conference call
A conference call and webcast for investors and analysts will begin today, 9
November 2023, at 14:00 UK time. Details can be accessed via astrazeneca.com
(https://www.astrazeneca.com/) .
Reporting calendar
The Company intends to publish its full year and fourth quarter results on
Thursday 8 February 2024.
Operating and financial review
All narrative on growth and results in this section is based on actual foreign
exchange rates, and financial figures are in US$ millions ($m), unless stated
otherwise. The performance shown in this announcement covers the nine-month
period to 30 September 2023 ('the period' or '9M 2023') compared to the
nine-month period to 30 September 2022 ('9M 2022'), or the three-month period
to 30 September 2023 ('the quarter' or 'Q3 2023') compared to the three-month
period to 30 September 2022 ('Q3 2022'), unless stated otherwise.
Core financial measures, EBITDA, Net debt, Product Sales Gross Margin
(formerly termed as Gross Margin), Operating Margin and CER are non-GAAP
financial measures because they cannot be derived directly from the Group's
Interim financial statements. Management believes that these non-GAAP
financial measures, when provided in combination with Reported results,
provide investors and analysts with helpful supplementary information to
understand better the financial performance and position of the Group on a
comparable basis from period to period. These non-GAAP financial measures are
not a substitute for, or superior to, financial measures prepared in
accordance with GAAP.
Core financial measures are adjusted to exclude certain significant items,
such as:
‒ Amortisation and impairment of intangible assets, including
impairment reversals but excluding any charges relating to IT assets
‒ Charges and provisions related to restructuring programmes, which
includes charges that relate to the impact of restructuring programmes on
capitalised IT assets
‒ Alexion acquisition-related items, primarily fair value adjustments
on acquired inventories and fair value impact of replacement employee share
awards
‒ Other specified items, principally the imputed finance charges and
fair value movements relating to contingent consideration on business
combinations or asset acquisitions, imputed finance charges and remeasurement
adjustments on certain Other payables arising from intangible asset
acquisitions, legal settlements and remeasurement adjustments relating to
Other payables assumed from the Alexion acquisition
‒ The tax effects of the adjustments above are excluded from the Core
Tax charge
Details on the nature of Core financial measures are provided on page 63 of
the Annual Report and Form 20-F Information 2022
(https://www.astrazeneca.com/content/dam/az/Investor_Relations/annual-report-2022/pdf/AstraZeneca_AR_2022.pdf)
.
Reference should be made to the Reconciliation of Reported to Core financial
measures table included in the financial performance section in this
announcement.
Product Sales Gross Margin (formerly termed Gross Margin) is the percentage by
which Product Sales exceeds the Cost of Sales, calculated by dividing the
difference between the two by the sales figure. The calculation of Reported
and Core Product Sales Gross Margin excludes the impact of Alliance Revenue
and Collaboration Revenue and any associated costs, thereby reflecting the
underlying performance of Product Sales.
EBITDA is defined as Reported Profit before tax after adding back Net finance
expense, results from Joint ventures and associates and charges for
Depreciation, amortisation and impairment. Reference should be made to the
Reconciliation of Reported Profit before tax to EBITDA included in the
financial performance section in this announcement.
Operating Margin is defined as Operating profit as a percentage of Total
Revenue.
Net debt is defined as Interest-bearing loans and borrowings and Lease
liabilities, net of Cash and cash equivalents, Other investments, and Net
derivative financial instruments. Reference should be made to Note 3 'Net
debt' included in the Notes to the Interim financial statements in this
announcement.
The Company strongly encourages investors and analysts not to rely on any
single financial measure, but to review AstraZeneca's financial statements,
including the Notes thereto, and other available Company reports, carefully
and in their entirety.
Due to rounding, the sum of a number of dollar values and percentages in this
announcement may not agree to totals.
Total Revenue
Table 5: Therapy area and medicine performance - Product Sales and Total
Revenue
9M 2023 Q3 2023
% Change % Change
Product Sales $m % Total Actual CER $m % Total Actual CER
Oncology 12,692 38 17 20 4,389 38 16 17
- Tagrisso 4,380 13 7 10 1,465 13 5 6
- Imfinzi 33 (#_ftn33) 3,102 9 53 56 1,126 10 53 54
- Lynparza 2,070 6 6 9 702 6 7 8
- Calquence 1,839 5 25 26 654 6 16 15
- Enhertu 178 1 >3x >3x 73 1 >3x >3x
- Orpathys 33 - (3) 4 12 - 6 13
- Zoladex 699 2 (3) 5 239 2 - 5
- Faslodex 217 1 (16) (10) 64 1 (21) (16)
- Others 174 1 (36) (32) 54 - (33) (30)
BioPharmaceuticals: CVRM 7,887 23 14 18 2,683 23 14 16
- Farxiga 4,358 13 36 40 1,554 14 41 41
- Brilinta 996 3 (2) - 331 3 (2) (1)
- Lokelma 300 1 44 49 102 1 30 31
- roxadustat 208 1 41 51 74 1 31 39
- Andexxa 129 - 16 19 40 - (3) (5)
- Crestor 860 3 4 11 275 2 (1) 6
- Seloken/Toprol-XL 496 1 (30) (23) 153 1 (36) (29)
- Onglyza 180 1 (12) (8) 53 - (20) (17)
- Bydureon 123 - (40) (40) 35 - (48) (49)
- Others 237 1 (16) (13) 66 1 (23) (21)
BioPharmaceuticals: R&I 4,517 13 5 8 1,451 13 2 3
- Symbicort 1,842 5 (4) (1) 555 5 (12) (10)
- Fasenra 1,134 3 12 13 389 3 10 10
- Breztri 478 1 69 73 171 1 66 69
- Saphnelo 191 1 >2x >2x 76 1 >2x >2x
- Tezspire 51 - >10x >10x 21 - >10x >10x
- Pulmicort 493 1 3 10 148 1 2 7
- Bevespi 42 - (2) (2) 13 - (5) (4)
- Daliresp/Daxas 41 - (74) (74) 11 - (79) (79)
- Others 245 1 (30) (27) 67 1 (31) (28)
BioPharmaceuticals: V&I 667 2 (82) (81) 224 2 (74) (74)
- COVID-19 mAbs 34 (#_ftn34) 126 - (91) (90) - - n/m n/m
- Vaxzevria 28 - (98) (98) - - n/m n/m
- Beyfortus 52 - n/m n/m 50 - n/m n/m
- Synagis 383 1 - 6 99 1 (5) (1)
- FluMist 78 - 32 28 75 1 28 23
Rare Disease 5,793 17 11 12 1,974 17 13 14
- Soliris 2,429 7 (17) (15) 781 7 (13) (12)
- Ultomiris( ) 2,141 6 56 58 777 7 50 49
- Strensiq( ) 847 3 23 24 285 2 20 21
- Koselugo 246 1 65 65 87 1 81 81
- Kanuma( ) 130 - 17 18 44 - 21 19
Other Medicines 910 3 (27) (22) 297 3 (27) (22)
- Nexium 735 2 (25) (20) 244 2 (22) (17)
- Others 175 1 (33) (31) 53 - (43) (41)
Product Sales 32,466 96 1 4 11,018 96 4 5
Alliance Revenue 1,004 3 99 99 377 3 76 75
Collaboration Revenue 317 1 (28) (28) 97 1 (46) (47)
Total Revenue 33,787 100 2 5 11,492 100 5 6
Table 6: Alliance Revenue
9M 2023 Q3 2023
% Change % Change
$m % Total Actual CER $m % Total Actual CER
Enhertu 741 74 >2x >2x 266 70 66 65
Tezspire 179 18 >4x >4x 74 20 >2x >2x
Vaxzevria: royalties - - n/m n/m - - n/m n/m
Other royalty income 59 6 16 15 18 5 10 9
Other Alliance Revenue 25 2 >2x >2x 19 5 >3x >3x
Total 1,004 100 99 99 377 100 76 75
Table 7: Collaboration Revenue
9M 2023 Q3 2023
% Change % Change
$m % Total Actual CER $m % Total Actual CER
COVID-19 mAbs: licence fees 180 57 n/m n/m - - n/m n/m
Farxiga: sales milestones 28 9 n/m n/m 3 3 n/m n/m
tralokinumab: sales milestones 20 6 (82) (82) 20 21 (50) (50)
Lynparza: regulatory milestones - - n/m n/m - - n/m n/m
Beyfortus: regulatory milestones 71 22 n/m n/m 71 73 n/m n/m
Other Collaboration Revenue 18 6 (76) (76) 3 3 (95) (95)
Total 317 100 (28) (28) 97 100 (46) (47)
Table 8: Total Revenue by therapy area
9M 2023 Q3 2023
% Change % Change
$m % Total Actual CER $m % Total Actual CER
Oncology 13,458 40 17 20 4,664 41 15 17
BioPharmaceuticals 13,599 40 (10) (7) 4,548 40 (4) (2)
- CVRM 7,926 23 14 19 2,687 23 14 16
- R&I 4,729 14 6 9 1,549 13 3 5
- V&I 944 3 (74) (73) 312 3 (64) (65)
Rare Disease 5,793 17 11 12 1,974 17 13 14
Other Medicines 937 3 (30) (26) 306 3 (36) (32)
Total 33,787 100 2 5 11,492 100 5 6
Table 9: Total Revenue by region
9M 2023 Q3 2023
% Change % Change
$m % Total Actual CER $m % Total Actual CER
US 13,940 41 6 6 4,859 42 5 4
Emerging Markets 9,242 27 3 10 2,964 26 4 12
- China 4,495 13 (2) 5 1,452 13 (6) 1
- Ex-China 4,747 14 8 15 1,513 13 15 25
Europe 6,765 20 5 5 2,392 21 16 9
Established RoW 3,840 11 (16) (9) 1,276 11 (10) (6)
Total 33,787 100 2 5 11,492 100 5 6
Table 10: Total Revenue by region - excluding COVID-19 medicines
9M 2023 Q3 2023
% Change % Change
$m % Total Actual CER $m % Total Actual CER
US 13,940 42 14 14 4,859 42 12 12
Emerging Markets 9,038 27 12 20 2,964 26 8 16
- China 4,495 13 (1) 6 1,452 13 (6) 1
- Ex-China 4,544 14 28 37 1,513 13 25 36
Europe 6,748 20 14 14 2,392 21 23 16
Established RoW 3,726 11 - 8 1,276 11 5 10
Total 33,453 100 12 15 11,492 100 12 13
Oncology
Oncology Total Revenue of $13,458m in 9M 2023 increased by 17% (20% at CER),
representing 40% of overall Total Revenue (9M 2022: 35%). There was no
Lynparza Collaboration Revenue in 9M 2023 (9M 2022: $250m), and Enhertu
Alliance Revenue was $741m (9M 2022: $335m). Product Sales increased by 17%
(20% at CER) in 9M 2023 to $12,692m, reflecting new launches and expanded
reimbursement across key brands; partially offset by declines in legacy
medicines.
Tagrisso
Total Revenue Worldwide US Emerging Markets Europe Established RoW
9M 2023 $m 4,380 1,679 1,261 821 619
Actual change 7% 14% 4% 6% (4%)
CER change 10% 14% 11% 6% 5%
Region Drivers and commentary
Worldwide * Increased global demand for Tagrisso in adjuvant and 1st-line settings
combined with expanded reimbursement in the adjuvant setting
US * Continued growth in demand in 1st-line and adjuvant settings
Emerging Markets * Growing demand in adjuvant and 1st-line settings offset by impact of
NRDL 35 (#_ftn35) renewal price in China effective March 2023, some
additional impact in China in the third quarter resulting from reduced
promotional activities following the government campaign announced at the end
of July 2023
Europe * Increased demand growth in 1st-line and growing adjuvant demand
Established RoW * Increased demand in 1st-line and adjuvant settings offset by mandatory
price reduction in Japan effective June 2023
Imfinzi and Imjudo
Total Revenue Worldwide US Emerging Markets Europe Established RoW
9M 2023 $m 3,102 1,708 270 547 577
Actual change 53% 55% 20% 36% 90%
CER change 56% 55% 31% 35% >2x
Region Drivers and commentary
Worldwide * Includes $161m of Total Revenue from Imjudo, which launched in Q4 2022
following approvals in the US for patients with unresectable liver cancer
(HIMALAYA) and Stage IV NSCLC (POSEIDON)
* Growth across all regions, driven by recent launches (BTC 36 (#_ftn36) ,
HCC 37 (#_ftn37) , Stage IV NSCLC) and established indications (Stage III
NSCLC, SCLC 38 (#_ftn38) )
US * Continued demand growth for BTC and HCC indications, increased uptake in
SCLC
Emerging Markets * Growth across markets driven by BTC launches and recovery of diagnosis and
treatment rates following the COVID-19 pandemic, slightly offset by decreased
promotional activities in China due to the government campaign announced at
the end of July 2023
Europe * Competitive share gain in SCLC, and expanded reimbursement for new launch
indications (BTC, HCC and Stage IV NSCLC)
Established RoW * Growth driven by launch of HCC and BTC and increased share across
indications in Japan
Lynparza
Total Revenue Worldwide US Emerging Markets Europe Established RoW
9M 2023 $m 2,070 902 409 543 216
Actual change (6%) 1% 14% (27%) 7%
CER change (3%) 1% 24% (27%) 16%
Product Sales Worldwide US Emerging Markets Europe Established RoW
9M 2023 $m 2,070 902 409 543 216
Actual change 6% 1% 14% 10% 7%
CER change 9% 1% 24% 10% 16%
Region Drivers and commentary
Worldwide * Lynparza remains the leading medicine in the PARP 39 (#_ftn39) inhibitor
class globally across four tumour types (ovarian, breast, prostate,
pancreatic), as measured by total prescription volume
* No regulatory milestones received in the period
US * Continued share growth within the PARP inhibitor class, offset by
declining class use and the label restriction in 2nd-line ovarian cancer
effective September 2023
Emerging Markets * Increased demand, offset by price reduction in China associated with NRDL
renewal that took effect March 2023 for ovarian cancer indications (PSR 40
(#_ftn40) and BRCAm 41 (#_ftn41) 1st-line maintenance) and new NRDL
enlistment in prostate cancer (PROfound) as well as some impact in the third
quarter resulting from reduced promotional activities following the government
campaign announced end of July 2023
Europe * Demand growth from increased uptake in 1st-line HRD-positive ovarian
cancer, gBRCAm 42 (#_ftn42) HER2‑negative early breast cancer and mCRPC,
offset by reduced use in 2nd-line ovarian cancer and pricing
* Total Revenue in the prior year period included $250m of milestones
Established RoW * Growth driven by increased uptake in testing and use in 1st-line
HRD-positive ovarian cancer
Enhertu
Total Revenue Worldwide US Emerging Markets Europe Established RoW
9M 2023 $m 919 518 179 204 17
Actual change >2x >2x >3x >2x >3x
CER change >2x >2x >3x >2x >3x
Region Drivers and commentary
Worldwide * Combined sales of Enhertu, recorded by Daiichi Sankyo Company Limited
(Daiichi Sankyo) and AstraZeneca, amounted to $1,844m in 9M 2023 (9M 2022:
$750m)
* AstraZeneca's Total Revenue of $919m in the period includes $741m of
Alliance Revenue from its share of gross profit and royalties in territories
where Daiichi Sankyo records product sales
US * US in-market sales, recorded by Daiichi Sankyo, amounted to $1,087m in 9M
2023 (9M 2022: $532m)
* Increased demand across launched indications. Q3 2023 impacted by HER2-low
bolus depletion
Emerging Markets * Continued uptake driven by recent approvals and launches including strong
demand growth in China following HER2-positive and HER2-low breast cancer
launches
Europe * Continued growth driven by increasing adoption in HER2-positive and
HER2-low metastatic breast cancer
Established RoW * In Japan, AstraZeneca receives a mid-single-digit percentage royalty on
sales made by Daiichi Sankyo
Calquence
Total Revenue Worldwide US Emerging Markets Europe Established RoW
9M 2023 $m 1,839 1,337 69 353 80
Actual change 25% 12% >2x 76% 64%
CER change 26% 12% >2x 77% 74%
Region Drivers and commentary
Worldwide * Increased penetration globally; leading BTKi 43 (#_ftn43) in key markets
US * Leadership maintained in growing BTKi class, sustained leading share in
the front-line setting, offset by some competitive impact in relapsed
refractory setting and increased utilisation of free goods program in Q3
EU * Solid growth continued amidst growing competitive pressure
* Increased new patients starts following expanded access in key markets
Orpathys
Orpathys Total Revenue of $34m declined 1% (6% increase at CER), (9M 2022:
$35m), following its inclusion in the updated NRDL in China from March 2023,
for the treatment of patients with NSCLC with MET exon 14 skipping
alterations.
Other Oncology medicines
9M 2023 Change
Total Revenue $m Actual CER
Zoladex 723 (2%) 5% * Underlying growth due to continued demand growth in Emerging Markets,
partially offset by price reduction in China following NRDL renewal
Faslodex 217 (16%) (10%) * Generic competition
Other Oncology 174 (36%) (32%) * Generic competition
BioPharmaceuticals
BioPharmaceuticals Total Revenue decreased by 10% (7% at CER) in 9M 2023 to
$13,599m, representing 40% of overall Total Revenue (9M 2022: 45%). The
decline was driven by COVID-19 medicines, partially offset by strong growth
from Farxiga and newer R&I medicines.
BioPharmaceuticals - CVRM
CVRM Total Revenue increased by 14% (19% at CER) to $7,926m in 9M 2023, driven
by the strong Farxiga performance, and represented 23% of overall Total
Revenue (9M 2022: 21%).
Farxiga
Total Revenue Worldwide US Emerging Markets Europe Established RoW
9M 2023 $m 4,389 1,000 1,655 1,356 378
Actual change 37% 34% 35% 42% 35%
CER change 41% 34% 43% 41% 45%
Region Drivers and commentary
Worldwide * Farxiga volume is growing faster than the overall SGLT2 44 (#_ftn44)
market in most major regions, fuelled by launches in heart failure and CKD
* Additional benefit from continued growth in the overall SGLT2 inhibitor
class
US * Growth driven by heart failure and CKD for patients with and without
T2D 45 (#_ftn45) resulting in an increasing market share
Emerging Markets * Solid growth despite generic competition in some markets
Europe * Benefited from the addition of cardiovascular outcomes trial data to the
label and growth in HFrEF 46 (#_ftn46) , CKD and the HFpEF approval in
February 2023. ESC 47 (#_ftn47) guidelines updated in August 2023 to also
include treatment of patients with HFpEF
* Continued strong volume growth in the quarter and expanded class
leadership in several key markets
Established RoW * In Japan, AstraZeneca sells to collaborator Ono Pharmaceutical Co., Ltd,
which records in-market sales. Continued volume growth driven by HF and CKD
launches. Generics launched in Canada in the third quarter
Brilinta
Total Revenue Worldwide US Emerging Markets Europe Established RoW
9M 2023 $m 996 551 224 203 18
Actual change (2%) 2% 1% (5%) (54%)
CER change - 2% 10% (5%) (51%)
Region Drivers and commentary
US * Sales in the third quarter benefitted from channel inventory movements
Emerging Markets * Sales declined by 16% (4% at CER) in the third quarter driven by tender
phasing
Europe * Sales partly impacted by clawbacks
Established RoW * Sales decline driven by generic entry in Canada
Lokelma
Lokelma Total Revenue increased 44% (49% at CER) to $300m with strong demand
growth in all regions.
Roxadustat
Total Revenue increased 40% (50% at CER) to $212m, benefitting from increased
demand in both the dialysis- and non-dialysis-dependent populations
Andexxa
Andexxa Total Revenue increased 7% (9% at CER) to $129m.
Other CVRM medicines
9M 2023 Change
Total Revenue $m Actual CER
Crestor 862 4% 11% * Continued sales growth in Emerging Markets, partly offset by declines in
the US and Established RoW
Seloken 496 (30%) (23%) * Ongoing impact of China VBP implementation
Onglyza 180 (12%) (8%) * Continued decline for DPP-IV class
Bydureon 123 (40%) (40%) * Continued competitive pressures
Other CVRM 237 (16%) (13%)
BioPharmaceuticals - R&I
Total Revenue of $4,729m from R&I medicines in 9M 2023 increased 6% (9% at
CER) and represented 14% of overall Total Revenue (9M 2022: 14%). This
reflected growth in Fasenra, Tezspire, Breztri and Saphnelo, offsetting a
decline in Symbicort and other mature brands.
Fasenra
Total Revenue Worldwide US Emerging Markets Europe Established RoW
9M 2023 $m 1,134 718 48 262 106
Actual change 12% 11% 62% 14% (1%)
CER change 13% 11% 69% 14% 6%
Region Drivers and commentary
Worldwide * Retained market share leadership in severe eosinophilic asthma across
major markets
US * Expanded leadership in eosinophilic asthma and maintained total share in a
growing market, leading to double-digit volume growth, partially offset by
managed market price difference
Emerging Markets * Continued strong volume growth driven by launch acceleration across key
markets
Europe * Expanded leadership in severe eosinophilic asthma, with strong volume
growth partially offset by price in some markets
Established RoW * Maintained class leadership in Japan while market growth remained stable
Breztri
Total Revenue Worldwide US Emerging Markets Europe Established RoW
9M 2023 $m 478 263 123 55 37
Actual change 69% 60% 73% >2x 48%
CER change 73% 60% 86% >2x 58%
Region Drivers and commentary
Worldwide * Continued to gain market share within the growing FDC 48 (#_ftn48) triple
class across major markets
US * Consistent share growth within the FDC triple class in new-to-brand 49
(#_ftn49) and the total market
Emerging Markets * Maintained market share leadership in China with strong triple FDC class
penetration
Europe * Sustained growth across markets as new launches continue to progress
Established RoW * Increased market share gains within COPD in Japan and strong launch
performance in Canada
Tezspire
Total Revenue Worldwide US Emerging Markets Europe Established RoW
9M 2023 $m 230 179 - 28 23
Actual change >5x >4x - n/m n/m
CER change >5x >4x - n/m n/m
Region Drivers and commentary
Worldwide * Tezspire is approved in the US, EU and Japan (as well as other countries)
for the treatment of severe asthma without biomarker or phenotypic limitation
* Amgen records sales in the US, and AstraZeneca records its share of US
gross profits as Alliance Revenue. AstraZeneca books Product Sales in markets
outside the US
* Combined sales of Tezspire by AstraZeneca and Amgen were $438m in 9M 2023
US * Increased new-to-brand market share with majority of patients new to
biologics
* Pre-filled pen approved in February 2023
Europe * Achieved and maintained new-to-brand leadership in key markets
* Pre-filled pen approved in January 2023
Established RoW * Japan maintained new-to-brand leadership
Saphnelo
Total Revenue Worldwide US Emerging Markets Europe Established RoW
9M 2023 $m 191 178 1 5 7
Actual change >2x >2x n/m >4x >3x
CER change >2x >2x n/m >4x >3x
Region Drivers and commentary
Worldwide * Demand acceleration in the US, and additional growth driven by ongoing
launches in Europe and Japan
Symbicort
Total Revenue Worldwide US Emerging Markets Europe Established RoW
9M 2023 $m 1,842 589 600 408 245
Actual change (4%) (18%) 26% (8%) (12%)
CER change (1%) (18%) 36% (8%) (7%)
Region Drivers and commentary
Worldwide * Symbicort remained the global market leader within a stable ICS 50
(#_ftn50) /LABA 51 (#_ftn51) class
US * Generic competition entered the US market in the third quarter, leading to
price and volume share declines
Emerging Markets * Strong underlying demand. Growth in China benefitted from the
post-COVID-19 recovery at the start of the year
Europe * Continued price and volume erosion from generics and a slowing overall
market
Established RoW * Generic erosion in Japan
Other R&I medicines
9M 2023 Change
Total Revenue $m Actual CER
Pulmicort 493 3% 10% * 80% of revenues from Emerging Markets
* China market share has stabilised, with VBP having been in effect for over
12 months
Bevespi 42 (2%) (2%)
Daliresp 41 (74%) (74%) * Impacted by uptake of multiple generics following loss of exclusivity in
the US
Other R&I 278 (41%) (38%) * Collaboration Revenue of $20m (9M 2022: $110m)
* Product Sales of $245m decreased 30% (27% at CER) due to generic
competition
BioPharmaceuticals - V&I
Total Revenue from V&I medicines declined by 74% (73% at CER) to $944m (9M
2022: $3,673m) and represented 3% of overall Total Revenue (9M 2022: 11%). In
Q3 2023, no revenue was generated from COVID‑19 medicines.
COVID-19 mAbs
Total Revenue Worldwide US Emerging Markets Europe Established RoW
9M 2023 $m 306 - 185 7 114
Actual change (79%) n/m 11% (97%) (51%)
CER change (78%) n/m 11% (96%) (45%)
Region Drivers and commentary
Worldwide * All Product Sales in 9M 2023 were derived from sales of Evusheld in the
first quarter
Emerging Markets * $180m license fee from Serum Institute of India in Q2 2023 recorded as
Collaboration Revenue
Vaxzevria
Total Revenue Worldwide US Emerging Markets Europe Established RoW
9M 2023 $m 28 - 18 10 -
Actual change (98%) n/m (98%) (97%) n/m
CER change (98%) n/m (98%) (97%) n/m
Region Drivers and commentary
Worldwide * Revenue in the period decreased by 98% due to the conclusion of Vaxzevria
contracts
Other V&I medicines
9M 2023 Change
Total Revenue $m Actual CER
Beyfortus 139 n/m n/m * In Q3 2023 AstraZeneca reported $50m of Product Sales, $17m of Alliance
Revenue, and also $71m of Collaboration Revenue relating to a regulatory
milestone
* The Product Sales relates to sales to Sanofi of Beyfortus product
manufactured by AstraZeneca. In Q3 Product Sales benefitted from stock
building for the 2023-2024 RSV 52 (#_ftn52) season
* The Alliance Revenue consists of AstraZeneca's 50% share of gross profits
on sales of Beyfortus in major markets outside the US. AstraZeneca will also
book 25% of revenues in rest of world markets. AstraZeneca has no
participation in US profits or losses
Synagis 383 - 6% * Performance broadly in-line with prior year
FluMist 88 49% 45% * $10m milestone received from Daiichi Sankyo in the second quarter
following FluMist approval in Japan
Rare Disease
Total Revenue from Rare Disease medicines increased by 11% (12% at CER) in 9M
2023 to $5,793m, representing 17% of overall Total Revenue (9M 2022: 16%).
Performance was driven by the continued growth and durability of the C5 53
(#_ftn53) franchise, and also the strength of Strensiq and Koselugo patient
demand.
Ultomiris
Total Revenue Worldwide US Emerging Markets Europe Established RoW
9M 2023 $m 2,141 1,260 47 495 339
Actual change 56% 63% 38% 43% 54%
CER change 58% 63% 39% 42% 68%
Region Drivers and commentary
Worldwide * Growth in neurology indications, expansion into new markets and continued
conversion from Soliris
* Quarter-on-quarter variability in revenue growth can be expected due to
Ultomiris every eight-week dosing schedule and lower average annual treatment
cost per patient compared to Soliris
US * Growth in naïve patients in gMG 54 (#_ftn54) and NMOSD as well as
successful conversion from Soliris across shared indications
Emerging Markets * Continued progress following launches in new markets
Europe * Strong demand generation following launches in new markets, particularly
in neurology indications, as well as accelerated conversion from Soliris in
key markets
Established RoW * Continued conversion from Soliris and strong demand following new
launches, particularly NMOSD in Japan
Soliris
Total Revenue Worldwide US Emerging Markets Europe Established RoW
9M 2023 $m 2,429 1,313 338 530 248
Actual change (17%) (22%) 55% (15%) (36%)
CER change (15%) (22%) 74% (15%) (31%)
Region Drivers and commentary
US * Decline driven by successful conversion of Soliris patients to Ultomiris
in PNH, aHUS and gMG, partially offset by Soliris growth in NMOSD
Emerging Markets * Continued progress, launching in new markets
Europe, * Decline driven by successful conversion from Soliris to Ultomiris,
Established RoW partially offset by growth in NMOSD
Strensiq
Total Revenue Worldwide US Emerging Markets Europe Established RoW
9M 2023 $m 847 690 29 64 64
Actual change 23% 26% 14% 9% 12%
CER change 24% 26% 16% 8% 22%
Region Drivers and commentary
Worldwide * Strong patient demand particularly in the US and Japan
Other Rare Disease medicines
9M 2023 Change
Total Revenue $m Actual CER Commentary
Koselugo 246 65% 65% * Driven by patient demand and expansion in new markets
Kanuma 130 17% 18% * Continued demand growth in ex-US markets
Other medicines (outside the main therapy areas)
9M 2023 Change
Total Revenue $m Actual CER Commentary
Nexium 748 (30%) (25%) * Generic launches in Japan in the latter part of 2022
Others 189 (31%) (29%) * Continued impact of generic competition
Financial performance
Table 11: Reported Profit and Loss
9M 2023 9M 2022 % Change Q3 2023 Q3 2022 % Change
$m $m Actual CER $m $m Actual CER
Total Revenue 33,787 33,144 2 5 11,492 10,982 5 6
- Product Sales 32,466 32,200 1 4 11,018 10,590 4 5
- Alliance Revenue 1,004 504 99 99 377 214 76 75
- Collaboration Revenue 317 440 (28) (28) 97 178 (46) (47)
Cost of sales (5,960) (9,491) (37) (38) (2,095) (2,982) (30) (31)
Gross profit 27,827 23,653 18 22 9,397 8,000 17 20
Product Sales Gross Margin 81.6% 70.5% +11pp +12pp 81.0% 71.8% +9pp +10pp
Distribution expense (394) (380) 4 6 (129) (126) 2 2
% Total Revenue 1.2% 1.1% - - 1.1% 1.1% - -
R&D expense (7,862) (7,137) 10 12 (2,584) (2,458) 5 4
% Total Revenue 23.3% 21.5% -2pp -2pp 22.5% 22.4% - -
SG&A expense (13,845) (13,798) - 2 (4,800) (4,277) 12 12
% Total Revenue 41.0% 41.6% +1pp +1pp 41.8% 38.9% -3pp -2pp
OOI 55 (#_ftn55) & expense 1,233 325 >3x >3x 70 106 (34) (33)
% Total Revenue 3.6% 1.0% +3pp +3pp 0.6% 1.0% - -
Operating profit 6,959 2,663 >2x >2x 1,954 1,245 57 69
Operating Margin 20.6% 8.0% +13pp +14pp 17.0% 11.3% +6pp +7pp
Net finance expense (945) (936) 1 1 (291) (324) (9) (6)
Joint ventures and associates (12) (4) >2x >2x (11) 1 n/m n/m
Profit before tax 6,002 1,723 >3x >3x 1,652 922 79 91
Taxation (1,000) 668 n/m n/m (274) 720 n/m n/m
Tax rate 17% -39% 17% -78%
Profit after tax 5,002 2,391 >2x >2x 1,378 1,642 (16) (6)
Earnings per share $3.22 $1.54 >2x >2x $0.89 $1.06 (16) (6)
Table 12: Reconciliation of Reported Profit before tax to EBITDA
9M 2023 9M 2022 % Change Q3 2023 Q3 2022 % Change
$m $m Actual CER $m $m Actual CER
Reported Profit before tax 6,002 1,723 >3x >3x 1,652 922 79 91
Net finance expense 945 936 1 1 291 324 (9) (6)
Joint ventures and associates 12 4 >2x >2x 11 (1) n/m n/m
Depreciation, amortisation and impairment 4,060 4,000 2 3 1,282 1,334 (4) (4)
EBITDA 11,019 6,663 65 77 3,236 2,579 25 32
EBITDA for the comparative 9M 2022 was negatively impacted by $3,175m unwind
of inventory fair value uplift recognised on the acquisition of Alexion.
EBITDA for the comparative Q3 2022 was negatively impacted by $857m unwind of
inventory fair value uplift recognised on the acquisition of Alexion. This
unwind had a $78m negative impact on 9M 2023 and a $23m negative impact on Q3
2023. It will continue to be minimal and will unwind fully over the next
quarter.
Table 13: Reconciliation of Reported to Core financial measures: 9M 2023
9M 2023 Reported Restructuring Intangible Asset Amortisation & Impairments Acquisition Other 56 (#_ftn56) Core Core
of Alexion
% Change
$m $m $m $m $m $m Actual CER
Gross profit 27,827 133 24 82 (4) 28,062 4 8
Product Sales Gross Margin 81.6% 82.4% +1pp +2pp
Distribution expense (394) - - - - (394) 4 6
R&D expense (7,862) 117 386 5 1 (7,353) 5 7
SG&A expense (13,845) 163 2,863 7 1,107 (9,705) 5 8
Total operating expense (22,101) 280 3,249 12 1,108 (17,452) 5 7
Other operating income & expense 1,233 (61) - - - 1,172 >3x >3x
Operating profit 6,959 352 3,273 94 1,104 11,782 10 16
Operating Margin 20.6% 34.9% +2pp +3pp
Net finance expense (945) - - - 220 (725) (1) (2)
Taxation (1,000) (81) (617) (22) (329) (2,049) 12 19
EPS $3.22 $0.17 $1.72 $0.05 $0.64 $5.80 10 17
Table 14: Reconciliation of Reported to Core financial measures: Q3 2023
Q3 2023 Reported Restructuring Intangible Asset Amortisation & Impairments Acquisition Other 57 (#_ftn57) Core Core
of Alexion
% Change
$m $m $m $m $m $m Actual CER
Gross profit 9,397 15 8 25 (1) 9,444 6 7
Product Sales Gross Margin 81.0% 81.4% +1pp +1pp
Distribution expense (129) - - - - (129) 3 2
R&D expense (2,584) 48 49 2 - (2,485) 5 5
SG&A expense (4,800) 61 957 3 424 (3,355) 6 7
Total operating expense (7,513) 109 1,006 5 424 (5,969) 6 6
Other operating income & expense 70 - - - - 70 (35) (34)
Operating profit 1,954 124 1,014 30 423 3,545 4 9
Operating Margin 17.0% 30.8% - +1pp
Net finance expense (291) - - - 68 (223) (12) (7)
Taxation (274) (29) (189) (7) (125) (624) 8 13
EPS $0.89 $0.06 $0.53 $0.01 $0.24 $1.73 4 9
Profit and Loss drivers
Gross profit
‒ The calculation of Reported and Core Product Sales Gross Margin
excludes the impact of Alliance Revenue and Collaboration Revenue. The change
in Product Sales Gross Margin (Reported and Core) in the nine months was
impacted by:
‒ Positive effects from product mix. The increased contribution from
Rare Disease and Oncology medicines had a positive impact on the Product Sales
Gross Margin. Vaxzevria sales, which are dilutive to Product Sales Gross
Margin, declined substantially
‒ Dilutive effects from product mix. The rising contribution of
Product Sales with profit sharing arrangements (Lynparza, Enhertu and
Tezspire) has a negative impact on Product Sales Gross Margin because
AstraZeneca records product revenues in certain markets but pays away a share
of the gross profit to its collaboration partners
‒ Dilutive effects from geographic mix. Emerging Markets, where
Product Sales Gross Margin tends to be below the Company average, grew as a
proportion of Total Revenue excluding COVID-19 medicines
‒ Variations in Product Sales Gross Margin performance between periods
can continue to be expected due to product seasonality, foreign exchange
fluctuations and other effects.
R&D expense
‒ The change in R&D expense (Reported and Core) in the period was
impacted by:
‒ Recent positive data read-outs for several high priority medicines
that have ungated late-stage trials
‒ Investment in platforms, new technology and capabilities to enhance
R&D productivity
‒ Reported R&D expense was also impacted by intangible asset
impairments
SG&A expense
‒ The change in SG&A expense (Reported and Core) in the period was
driven primarily by market development activities for launches
‒ Reported SG&A expense was also impacted by amortisation of
intangible assets related to the Alexion acquisition and other acquisitions
and collaborations
‒ Reported SG&A expense was also impacted by a $510m charge to
provisions relating to a legal settlement in Q2 2023 with Bristol-Myers Squibb
and Ono Pharmaceutical, and a $425m charge to provisions in Q3 2023 for
product liability litigations related to Nexium and Prilosec. The prior nine
month period was impacted by a $775m legal settlement with Chugai
Pharmaceutical Co. Ltd
Other operating income and expense
‒ Reported and Core Other operating income and expense in the period
included a $712m gain resulting from an update to the contractual
relationships for Beyfortus (nirsevimab), a $241m gain on the disposal of the
US rights to Pulmicort Flexhaler, and other disposal proceeds on the sale of
tangible assets, and royalties on certain medicines
‒ In the third quarter Reported and Core Other operating income
decreased by $36m and $37m respectively, principally due to the
discontinuation of brazikumab development. Prior to this, AstraZeneca received
quarterly development contributions for brazikumab development from AbbVie,
which were recognised as Other operating income
Net finance expense
‒ Reported Net finance expense was impacted by the discount unwind on
acquisition-related liabilities. Core Net finance expense reduced by 1% (2% at
CER) with higher interest received on cash and short-term investments, broadly
offset by higher rates on floating debt and bond issuances
Taxation
‒ The effective Reported Tax rate for the nine months to 30 September
2023 was 17% (9M 2022: (39%)) and the effective Core Tax rate was 19% (9M
2022: 18%). The Q3 2022 effective Reported Tax rate was lower as it included a
one-time favourable adjustment of $883m relating to deferred taxes arising
from an internal reorganisation to integrate the Alexion business
‒ The cash tax paid for the nine months to 30 September 2023 was
$1,710m (9M 2022: $1,335m), representing 28% of Reported Profit before tax (9M
2022: 77%)
‒ On 20 June 2023, Finance (No.2) Act 2023 was substantively enacted
in the UK, introducing a global minimum effective tax rate of 15%. The
legislation implements a domestic top-up tax and a multinational top-up tax,
effective for accounting periods starting on or after 31 December 2023. The
Company is currently assessing the impact of these rules upon its financial
statements. The Company has applied the exception under the IAS 12 'Income
Taxes' amendment for recognising and disclosing information about deferred tax
assets and liabilities related to top-up income taxes
Table 15: Cash Flow summary
9M 2023 9M 2022 Change
$m $m $m
Reported Operating profit 6,959 2,663 4,296
Depreciation, amortisation and impairment 4,060 4,000 60
Decrease in working capital and short-term provisions 150 3,458 (3,308)
Gains on disposal of intangible assets (247) (88) (159)
Fair value movements on contingent consideration arising from 202 293 (91)
business combinations
Non-cash and other movements (623) (973) 350
Interest paid (826) (608) (218)
Taxation paid (1,710) (1,335) (375)
Net cash inflow from operating activities 7,965 7,410 555
Net cash inflow before financing activities 4,978 4,699 279
Net cash outflow from financing activities (6,276) (6,465) 189
In 9M 2022, the Reported Operating profit of $2,663m included a negative
impact of $3,175m relating to the unwind of the inventory fair value uplift
recognised on the acquisition of Alexion. This was offset by a corresponding
item (positive impact of $3,175m) in Decrease in working capital and
short-term provisions. Overall, the unwind of the fair value uplift had no
impact on Net cash inflow from operating activities. This unwind had $78m
negative impact on 9M 2023 Reported Operating profit and offsetting positive
impact on Working capital movements, and will continue to be minimal in the
next quarter. As a result of the update to the contractual relationships
between AstraZeneca, Sobi and Sanofi relating to the future sales of Beyfortus
(nirsevimab) in the US, a gain of $712m has been recorded in non-cash and
other movements, with no overall net impact on the Net cash inflow from
operating activities.
Included within Net cash inflow before financing activities is a movement in
the profit-participation liability of $190m, including a cash receipt from
Sobi in Q1 2023 after achievement of a regulatory milestone. The associated
cash flow is presented within investing activities.
The decrease in Net cash outflow from financing activities of $189m is
primarily driven by the Issue of loans and borrowings of $3,816m, offset by
the increase in Repayment of loans and borrowings of $3,394m.
Capital expenditure
Capital expenditure amounted to $836m in the nine months to 30 September 2023
(9M 2022: $719m).
Table 16: Net debt summary
At 30 At 31 At 30
Sep 2023 Dec 2022 Sep 2022
$m $m $m
Cash and cash equivalents 4,871 6,166 4,458
Other investments 244 239 440
Cash and investments 5,115 6,405 4,898
Overdrafts and short-term borrowings (515) (350) (743)
Lease liabilities (979) (953) (878)
Current instalments of loans (4,857) (4,964) (4,665)
Non-current instalments of loans (22,225) (22,965) (23,013)
Interest-bearing loans and borrowings (Gross debt) (28,576) (29,232) (29,299)
Net derivatives 90 (96) (141)
Net debt (23,371) (22,923) (24,542)
Net debt increased by $448m in the nine months to 30 September 2023 to
$23,371m. Details of the committed undrawn bank facilities are disclosed
within the going concern section of Note 1. Details of the Company's solicited
credit ratings and further details on Net Debt are disclosed in Note 3.
Capital allocation
The Board's aim is to continue to strike a balance between the interests of
the business, financial creditors and the Company's shareholders. The
Company's capital allocation priorities include: investing in the business and
pipeline; maintaining a strong, investment-grade credit rating; potential
value-enhancing business development opportunities; and supporting the
progressive dividend policy.
In approving the declaration of dividends, the Board considers both the
liquidity of the company and the level of reserves legally available for
distribution. Dividends are paid to shareholders from AstraZeneca PLC, a Group
holding company with no direct operations. The ability of AstraZeneca PLC to
make shareholder distributions is dependent on the creation of profits for
distribution and the receipt of funds from subsidiary companies. The
consolidated Group reserves set out in the Condensed consolidated statement of
financial position do not reflect the profit available for distribution to the
shareholders of AstraZeneca PLC.
Summarised financial information for guarantee of securities of subsidiaries
AstraZeneca Finance LLC ("AstraZeneca Finance") is the issuer of 0.700% Notes
due 2024, 1.200% Notes due 2026, 4.875% Notes due 2028, 1.750% Notes due 2028,
4.900% Notes due 2030, 2.250% Notes due 2031 and 4.875% Notes due 2033 (the
"AstraZeneca Finance Notes"). Each series of AstraZeneca Finance Notes has
been fully and unconditionally guaranteed by AstraZeneca PLC. AstraZeneca
Finance is 100% owned by AstraZeneca PLC and each of the guarantees by
AstraZeneca PLC is full and unconditional and joint and several.
The AstraZeneca Finance Notes are senior unsecured obligations of AstraZeneca
Finance and rank equally with all of AstraZeneca Finance's existing and future
senior unsecured and unsubordinated indebtedness. The guarantee by AstraZeneca
PLC of the AstraZeneca Finance Notes is the senior unsecured obligation of
AstraZeneca PLC and ranks equally with all of AstraZeneca PLC's existing and
future senior unsecured and unsubordinated indebtedness. Each guarantee by
AstraZeneca PLC is effectively subordinated to any secured indebtedness of
AstraZeneca PLC to the extent of the value of the assets securing such
indebtedness. The AstraZeneca Finance Notes are structurally subordinated to
indebtedness and other liabilities of the subsidiaries of AstraZeneca PLC,
none of which guarantee the AstraZeneca Finance Notes.
AstraZeneca PLC manages substantially all of its operations through divisions,
branches and/or investments in subsidiaries and affiliates. Accordingly, the
ability of AstraZeneca PLC to service its debt and guarantee obligations is
also dependent upon the earnings of its subsidiaries, affiliates, branches and
divisions, whether by dividends, distributions, loans or otherwise.
Please refer to the consolidated financial statements of AstraZeneca PLC in
our Annual Report on Form 20-F and reports on Form 6-K with our quarterly
financial results as filed or furnished with the SEC 58 (#_ftn58) for further
financial information regarding AstraZeneca PLC and its consolidated
subsidiaries. For further details, terms and conditions of the AstraZeneca
Finance Notes please refer to AstraZeneca PLC's reports on Form 6-K furnished
to the SEC on 3 March 2023 and 28 May 2021.
Pursuant to Rule 13-01 and Rule 3-10 of Regulation S-X under the Securities
Act of 1933, as amended (the "Securities Act"), we present below the summary
financial information for AstraZeneca PLC, as Guarantor, excluding its
consolidated subsidiaries, and AstraZeneca Finance, as the issuer, excluding
its consolidated subsidiaries. The following summary financial information of
AstraZeneca PLC and AstraZeneca Finance is presented on a combined basis and
transactions between the combining entities have been eliminated. Financial
information for non-guarantor entities has been excluded. Intercompany
balances and transactions between the obligor group and the non-obligor
subsidiaries are presented on separate lines.
Table 17: Obligor group summarised Statement of comprehensive income
9M 2023 9M 2022
$m $m
Total Revenue - -
Gross profit - -
Operating loss (2) (3)
Loss for the period (695) (404)
Transactions with subsidiaries that are not issuers or guarantors 9,758 502
Table 18: Obligor group summarised Statement of financial position
At 30 Sep 2023 At 30 Sep 2022
$m $m
Current assets 6 5
Non-current assets - -
Current liabilities (4,760) (3,067)
Non-current liabilities (22,077) (22,556)
Amounts due from subsidiaries that are not issuers or guarantors 12,921 7,349
Amounts due to subsidiaries that are not issuers or guarantors (295) (301)
Foreign exchange
The Company's transactional currency exposures on working-capital balances,
which typically extend for up to three months, are hedged where practicable
using forward foreign exchange contracts against the individual companies'
reporting currency. Foreign exchange gains and losses on forward contracts for
transactional hedging are taken to profit or loss. In addition, the Company's
external dividend payments, paid principally in pounds sterling and Swedish
krona, are fully hedged from announcement to payment date.
Table 19: Currency sensitivities
The Company provides the following currency-sensitivity information:
Average Annual impact ($m) of 5% strengthening (FY2023 average rate vs. FY 2022
average) (( 59 (#_ftn59) ))
rates vs. USD
Currency Primary Relevance FY YTD Change Sep 2023 62 (#_ftn62) Change 63 (#_ftn63) Total Revenue Core Operating Profit
2022 60 (#_ftn60)
2023 61 (#_ftn61)
(%) (%)
EUR Total Revenue 0.95 0.92 3 0.94 1 323 159
CNY Total Revenue 6.74 7.04 (4) 7.30 (8) 309 174
JPY Total Revenue 131.59 138.18 (5) 147.71 (11) 181 122
Other(( 64 (#_ftn64) )) 385 202
GBP Operating expense 0.81 0.80 1 0.81 0 46 (92)
SEK Operating expense 10.12 10.59 (4) 11.08 (9) 7 (55)
Sustainability
Since the last quarterly report, AstraZeneca:
Access to healthcare
‒ Hosted the first dedicated side-event on Chronic Kidney Disease
(CKD) "How improving kidney health can transform health systems for all"
during the 78th United Nations General Assembly (UNGA) meeting in New York,
with public, private and patient voices represented. During UNGA, the Company
also engaged with the cancer community on access, services within universal
health coverage (UHC) and the need for investment in cancer and
non-communicable diseases (NCDs)
‒ Continued to make a high-level contribution to the work of the
Partnership for Health System Sustainability and Resilience (PHSSR), which
provides a valuable platform for dialogue with policymakers, the Company and
other stakeholders. In Canada, a workshop with participation from the Minister
of Health of Quebec fed into the discussions on transformation of Quebec's
health system. In Japan, AstraZeneca's Chair Michel Demaré participated in a
PHSSR roundtable co-hosted by the British Embassy, which focused on health
equity and digital healthcare. PHSSR also engaged at leading global and
regional healthcare events, including the European Health Forum Gastein, the
Global Congress on Population, Health and Development, ICHOM 2023 and the
World Health Summit in Berlin
‒ Ruud Dobber, EVP BioPharmaceuticals Business Unit, delivered the
opening keynote address at the POLITICO EU Healthcare Summit in Brussels where
he called for bold action and collaboration across the healthcare ecosystem to
support early diagnosis and treatment. He highlighted the need for regulatory
frameworks that accelerate access to medical innovation, as well as the
urgency to combat the effects of the climate crisis on health
‒ Marked World Heart Day and the ninth anniversary of Healthy Heart
Africa (HHA)'s launch, by convening African health stakeholders to take stock
of the programme's achievements and share insights on the critical role of
public-private partnerships in supporting primary healthcare. Speakers
included representatives of Ministries of Health from nine countries and HHA
implementing partners, with more than 70 attendees. HHA has trained more than
11,000 healthcare workers and conducted over 43 million blood pressure
screenings, identifying 8.6 million with elevated blood pressure since launch,
moving closer to the programme ambition of 10 million by 2025, and achieving
one million screenings per month since February 2023 (data as at end of
September 2023)
‒ Young Health Programme is now active in 40 countries, with new
programmes launched in Costa Rica and Taiwan. Through the Young Health
Programme Impact Fellowship, the Company supported a delegation of 17 young
health leaders from 13 countries to attend One Young World 2023 in Belfast.
Three of these changemakers joined AstraZeneca leadership in on-stage
appearances, discussing their impact on NCD prevention for young people in
their communities. AstraZeneca and Plan International UK were awarded 'Highly
Commended' at the Corporate Engagement Awards for Best Educational Programme
Environmental protection
‒ Entered into an agreement in Sweden with Statkraft, Europe's largest
renewable energy producer, on wind power deliveries that will increase the
supply of renewable electricity in Sweden. The agreement is based on the
commissioning of new wind farms. Under the agreement, AstraZeneca commits to
purchasing 200 gigawatt-hours per year for 10 years, equivalent to two
terawatt-hours. This corresponds to approximately 80 percent of total
electricity needs at both the Company's Gothenburg site and at Södertälje,
the largest manufacturing centre and one of the world's largest drug
manufacturing centres
‒ Agreed a 15-year partnership with Future Biogas to establish the
first unsubsidised industrial-scale supply of biomethane in the UK. This
biomethane will support the transition away from fossil fuels at Company sites
in Macclesfield, Cambridge, Luton and Speke. A new biomethane plant will add
renewable energy capacity to existing UK infrastructure and supply more than
100 gigawatt hours of biomethane, equivalent to the heat needs of more than
8,000 homes. Using crops grown locally as part of diverse crop rotations, the
plant will also contribute to the development of a circular economy,
supporting UK farms with sustainable land management practices
‒ In China, CEO Pascal Soriot and EVP and China President Leon Wang
witnessed the launch of the Sustainable Markets Initiative (SMI) China Council
Health Working Group. Inspired by the SMI Health Systems Task Force, members
of this new partnership will collaborate to accelerate the delivery of a net
zero health system, for domestic and global impact. AstraZeneca China will
co-chair this Working Group, which comprises China-based organisations and
Chinese affiliates of global pharmaceutical companies
‒ In the U.S., advocated for climate action and sustainable healthcare
reform during Climate Week NYC by convening high-level representatives from
the US government, WHO, civil society and philanthropy at a plenary event with
Climate Group on "Addressing the climate-health-equity nexus: The path to a
sustainable future". The Company also discussed accelerating health sector
decarbonisation at the Forbes Sustainability Leaders Summit in a session on
"How the healthcare industry is responding to climate change" alongside US
National Academy of Medicine President Dr. Victor J. Dzau. Furthermore, the
Company participated in an event on water stewardship
‒ Contributed to a joint report on Advancing water stewardship through
supplier collaboration in partnership with the World Wide Fund for Nature
‒ Ranked in first position for climate action in a new STAT Report
"Climate rankings: How top drug companies measure up in combating climate
change", which noted that "Companies like AstraZeneca are the exception in an
industry that, as a whole, could be doing much more to measure and report its
climate impacts, according to organizations that pool data on this topic"
‒ Received the EcoVadis Gold Medal for 2023, improving on the 2022
Silver rating. AstraZeneca was scored in four areas: Environment, Ethics,
Labor and Human Rights, and Sustainable Procurement, and received an Advanced
rating in the Environment and Human Rights categories
‒ Recognised with two awards from My Green Lab and the International
Institute for Sustainable Laboratories' in the 2023 Freezer Challenge: the Top
Organization Award and the Small Size Lab Award for our site in Gothenburg,
Sweden
Ethics and transparency
‒ Received three supplier diversity awards from the Diversity for
Science Alliance including 2023 Company of the year
‒ Launched Global Ethics training ahead of Global Ethics Day in
October, an annual reminder to employees of the Company's commitment to high
ethical standards in all areas of AstraZeneca's business, marking the day with
local and virtual events and an #EmpoweringEthics employee social campaign
‒ Held an internal Power of Diversity panel discussion with members of
the Company's Global Inclusion & Diversity (I&D) Council on the topic
of putting an I&D lens over our AZ Values. This focused on building a
sense of belonging through allyship, mutual support and the sharing of diverse
perspectives. Supporting materials were made available through employee
communication channels
Research and development
This section covers R&D events and milestones that have occurred since the
prior results announcement on 28 July 2023, up to and including events on 8
November 2023.
A comprehensive view of AstraZeneca's pipeline of medicines in human trials
can be found in the latest Clinical Trials Appendix, available on
www.astrazeneca.com/investor-relations
(https://www.astrazeneca.com/investor-relations.html) . The Clinical Trials
Appendix includes tables with details of the ongoing clinical trials for
AstraZeneca medicines and new molecular entities in the pipeline.
Oncology
AstraZeneca presented new data across its diverse portfolio of cancer
medicines at two major medical congresses during the quarter: the 2023 World
Conference on Lung Cancer (WCLC) in September and the 2023 European Society of
Medical Oncology (ESMO) in October. At WCLC, AstraZeneca presented more than
40 abstracts featuring eight approved and potential new medicines, including
nine oral presentations and a late-breaking plenary Presidential Symposium
presentation of results from the FLAURA2 Phase III trial of Tagrisso plus
chemotherapy in 1st-line EGFRm NSCLC. At ESMO, AstraZeneca presented nearly
100 abstracts featuring 19 approved and potential new medicines including 26
oral presentations and two late-breaking Presidential Symposia of the
TROPION-Lung01 and TROPION-Breast 01 Phase III trials of monotherapy Dato-DXd
versus conventional chemotherapy in lung and breast cancers.
Tagrisso
Event Commentary
Breakthrough Designation US Tagrisso in combination with chemotherapy for the treatment of adult patients
with locally advanced or metastatic EGFRm lung cancer. (FLAURA2, August 2023)
Presentation: WCLC FLAURA2 Interim analysis of the Phase III FLAURA2 trial, presented at WCLC,
demonstrated Tagrisso plus chemotherapy extended median PFS 65 (#_ftn65) by
nearly nine months and reduced the risk of disease progression by 38% in EGFRm
advanced lung cancer vs. Tagrisso monotherapy. (September 2023)
Priority Review US Tagrisso in combination with chemotherapy for the treatment of adult patients
with locally advanced or metastatic EGFRm lung cancer. (FLAURA2, October 2023)
Presentation: ESMO FLAURA2 CNS analysis Prespecified exploratory analysis of the Phase III FLAURA2 trial, presented at
ESMO, showed Tagrisso plus chemotherapy demonstrated a 42% improvement in
CNS 66 (#_ftn66) PFS vs. Tagrisso monotherapy in patients with EGFRm advanced
lung cancer and brain metastases at baseline, representing 40% of patients in
the trial, as assessed by blinded independent central review. (October 2023)
Imfinzi and Imjudo
Event Commentary
Positive Opinion EU The Committee for Medicinal Products for Human Use (CHMP) issued a positive
opinion for Type II Extension of Indication Variation for Imfinzi as
monotherapy for the first line treatment of adults with advanced or
unresectable HCC. (HIIMALAYA, July 2023)
Presentation: ESMO MATTERHORN Interim analysis of the Phase III MATTERHORN III trial, presented at ESMO,
showed that Imfinzi in combination with standard-of-care FLOT 67 (#_ftn67)
neoadjuvant chemotherapy demonstrated a statistically significant and
clinically meaningful 12% improvement in the key secondary endpoint of pCR 68
(#_ftn68) vs. neoadjuvant chemotherapy alone for patients with resectable,
early-stage and locally gastric and GEJ 69 (#_ftn69) cancers. (October 2023)
Phase III data readout EMERALD-1 Positive high-level results from the EMERALD-1 Phase III trial showed Imfinzi
in combination with TACE 70 (#_ftn70) and bevacizumab demonstrated a
statistically significant and clinically meaningful improvement in the primary
endpoint of PFS versus TACE alone in patients with HCC eligible for
embolisation. The trial continues to follow the secondary endpoint of OS 71
(#_ftn71) . (November 2023)
Lynparza
Event Commentary
Approval Japan Lynparza in combination with abiraterone and prednisolone for the treatment of
adult patients with BRCAm mCRPC. (August 2023)
Label restriction US Restriction of the Lynparza indication for the maintenance treatment of adult
patients with recurrent epithelial ovarian, fallopian tube, or primary
peritoneal cancer who are in a complete or partial response to platinum-based
chemotherapy to the BRCAm (germline or somatic) patient population only.
(September 2023)
Presentation: ESMO DUO-E Primary analysis of the Phase III DUO-E Phase III trial, presented at ESMO,
showed that treatment with Imfinzi plus chemotherapy followed by either
(Lynparza and Imfinzi) Imfinzi monotherapy or Imfinzi plus Lynparza demonstrated a reduction in the
risk of disease progression or death, by 45% and 29%, respectively, vs.
chemotherapy alone in patients with advanced or recurrent endometrial cancer.
(October 2023)
Enhertu
Event Commentary
Approval Japan For the treatment of adult patients with unresectable advanced or recurrent
NSCLC with HER2 (ERBB2) mutations that has progressed after chemotherapy.
(DESTINY-Lung02, August 2023)
Breakthrough Designation US For the treatment of adult patients with unresectable or metastatic
HER2-positive (IHC 72 (#_ftn72) 3+) solid tumours that have progressed
following prior treatment and who have no alternative treatment options.
(DESTINY-PanTumor02, August 2023)
For the treatment of patients with HER2-positive (IHC 3+) metastatic
colorectal cancer who have received two or more prior regimens.
(DESTINY-CRC01, DESTINY-CRC02, August 2023)
Presentation: WCLC DESTINY-Lung02 Results from the primary analysis of the DESTINY-Lung02 Phase II trial,
presented at WCLC, showed Enhertu provided a median PFS of 9.9 months at a
dose of 5.4mg/kg, and 15.4 months at a dose of 6.4mg/kg, with a favourable
safety profile that confirm 5.4mg/kg is the optimal dose in this tumour type.
(September 2023)
Approval EU As monotherapy for the treatment of adult patients with advanced NSCLC whose
tumours have an activating HER2 (ERBB2 73 (#_ftn73) ) mutation and who
require systemic therapy following platinum-based chemotherapy with or without
immunotherapy. (DESTINY-Lung02, October 2023)
Presentation: ESMO DESTINY-PanTumor02 Primary analysis of the Phase II DESTINY-PanTumor02 trial, presented at ESMO,
showed that treatment with Enhertu resulted in confirmed ORR 74 (#_ftn74) of
37.1%, a median PFS of 6.9 months and median OS of 13.4 months in previously
treated patients across multiple HER2-expressing advanced solid tumours.
(October 2023)
Calquence
Event Commentary
Approval China For the treatment of adult patients with CLL or SLL 75 (#_ftn75) who have
received at least one prior therapy. (ASCEND, September 2023)
datopotamab deruxtecan (Dato-Dxd)
Event Commentary
Presentation: WCLC TROPION-Lung04 Results from a planned interim analysis of the Phase Ib TROPION-Lung04 trial,
presented at WCLC, showed that Dato-DXd in combination with Imfinzi, with or
without carboplatin demonstrated objective response rates of 77% and 50% and
disease control rates of 92% and 93% respectively, with no new safety signals
in patients with previously untreated advanced or metastatic NSCLC without
actionable genomic alterations. (September 2023)
Presentation: ESMO BEGONIA Updated results from the Phase Ib/II BEGONIA trial, presented at ESMO, showed
Dato-DXd plus Imfinzi demonstrated a confirmed objective response rate of 79%
and a median PFS of 13.8 months in patients with previously untreated advanced
or metastatic triple-negative breast cancer. (October 2023)
Presentation: ESMO TROPION-Lung01 Primary analysis for the Phase III TROPION-Lung01 trial, presented at ESMO,
showed that Dato-DXd reduced the risk of disease progression or death by 25%
in the overall population and by 37% in non-squamous tumours vs. docetaxel in
patients with previously treated NSCLC. (October 2023)
Presentation: ESMO TROPION-Breast01 Primary analysis for the Phase III TROPION-Breast01 trial, presented at ESMO,
showed that Dato-DXd reduced the risk of disease progression or death by 37%,
providing a two-month median PFS benefit, and was well tolerated in the
post-endocrine therapy setting vs. investigator's choice of chemotherapy in
patients with inoperable or metastatic HR-positive, HER2-low or HER2-negative
breast cancer previously treated with endocrine-based therapy and at least one
systemic therapy. (October 2023)
Other oncology pipeline
Event Commentary
Trial update MONETTE Phase II trial of ceralasertib + Imfinzi in unresectable or advanced melanoma
and resistance to PD-(L)1 inhibition stopped enrolment following a
pre-specified futility (efficacy) assessment. There were no concerning safety
signals identified at this interim analysis or during the two prior data
review meetings.
Presentation: ASCO Virtual Plenary NCT04805307 Interim analysis for the Phase I trial (NCT04805307) of CMG901 (Claudin 18.2
ADC 76 (#_ftn76) ) demonstrated promising clinical efficacy in patients with
heavily pre-treated CLDN18.2-positive gastric/GEJ cancer, with a manageable
safety profile. (November 2023)
BioPharmaceuticals - CVRM
AstraZeneca presented 19 abstracts, including 10 oral presentations and five
late-breaking presentations, at the European Society of Cardiology (ESC)
Congress in August, including data highlighting the opportunities for improved
management in heart failure, and AstraZeneca's leadership across the
interconnectedness of chronic diseases. At the American Society of
Nephrology's (ASN) Kidney Week in November, AstraZeneca presented 53 abstracts
showcasing the strength of its portfolio, including new ZORA and REVOLUTIONIZE
real-world evidence data for Lokelma and compelling next-wave pipeline
innovation with results from the ZENITH-CKD Phase IIb trial for
zibotentan/dapagliflozin.
Farxiga
Event Commentary
Approval China Approved in China to reduce the risk of cardiovascular death, hospitalisation
for HF 77 (#_ftn77) or urgent HF visits in adults with symptomatic chronic
HF. (June 2023)
Data T2NOW Positive data from the Phase III T2NOW trial, demonstrating a significant
reduction in A1C in patients aged 10-17 years compared to patients receiving
placebo. (October 2023)
Data DAPA-MI Primary endpoint met, non-registrational trial. (August 2023)
zibotentan/dapagliflozin
Event Commentary
Presentation: ZENITH-CKD Phase IIb data showed statistically significant and clinically meaningful
reductions in urinary albumin-to-creatinine ratio (UACR), used to assess
ASN albuminuria, at 12 weeks compared with the standard of care of dapagliflozin
alone. After 12 weeks of treatment, the UACR difference of
zibotentan/dapagliflozin versus dapagliflozin alone was -33.7% (90% CI -42.5
to -23.5; p<0.001) for high-dose (1.5 mg zibotentan / 10 mg dapagliflozin)
and -27.0% (90% CI -38.4 to -13.6; p=0.002) for low dose (0.25 mg/10mg).
(November 2023)
Eplontersen
Event Commentary
Orphan Drug Designation EU Orphan drug designation received for the treatment of ATTR 78 (#_ftn78) .
(October 2023)
BioPharmaceuticals - R&I
AstraZeneca presented new data across its inhaled, biologic and early science
respiratory portfolio at the European Respiratory Society (ERS) International
Congress 2023. The company presented over 90 abstracts, including 18 oral
presentations, which focused on unmet needs in severe asthma, chronic
obstructive pulmonary disease and other acute respiratory diseases. Data from
Fasenra and Tezspire advanced clinical remission as a treatment target to
change the trajectory of severe asthma care.
Fasenra
Event Commentary
Phase III data readout MANDARA Positive high-level results from the MANDARA Phase III trial for Fasenra
demonstrated non-inferior rates of remission compared to mepolizumab in
patients with EGPA who were receiving oral corticosteroids with or without
stable immunosuppressive therapy. MANDARA was the first head-to-head trial of
biologics in EGPA, comparing a single monthly injection of Fasenra to three
injections per month of mepolizumab, the only currently approved treatment.
(September 2023)
Presentation: ERS SHAMAL SHAMAL assessed the ability of Fasenra to permit a progressive reduction from
high-dose ICS/LABA down to anti-inflammatory reliever whilst maintaining
control in SEA 79 (#_ftn79) pts who were well-controlled on Fasenra. Fasenra
enabled the majority of SEA patients to maintain disease control and remain
exacerbation-free despite a reduction in background therapy to
anti-inflammatory reliever only. (September 2023)
Presentation: ERS MIRACLE The positive MIRACLE Phase III trial demonstrated a reduction in annual asthma
exacerbation rate of 74% among patients in China with uncontrolled SEA vs.
placebo. A filing for regulatory approval in China has been submitted, with a
decision expected in H2 2024. (September 2023)
Tezspire
Event Commentary
Presentation: ERS DESTINATION In a post-hoc exploratory analysis of the DESTINATION Phase III trial of
patients with severe, uncontrolled asthma, a numerically greater proportion of
patients who received tezepelumab than placebo achieved remission during the
time periods assessed. (September 2023)
BioPharmaceuticals - V&I
AZD3152
Event Commentary
Presentation: In-vitro neutralisation data In vitro neutralisation data presented at ID Week showed that AZD3152 potently
ID Week
neutralises across a broad range of historical and contemporary SARS-CoV-2
variants, including the newly emerging BA.2.86 variant. AZD3152 loses activity
against XBB variants with the F456L mutation. (October 2023)
The SUPERNOVA Phase III efficacy trial, which is now fully enrolled, will
assess the potential benefit of AZD3152 in protecting immunocompromised
patients in an environment with many variants in circulation.
FluMist
Event Commentary
sBLA Self administration The FDA has accepted for review a sBLA for the approval of a self- or
caregiver-administered option for FluMist. If approved, FluMist will be the
submission first flu vaccine available to be self-administered by eligible patients or
administered by caregivers. The sBLA is supported by a usability study which
confirmed that individuals over 18 years of age could self-administer or
administer FluMist to eligible patients 2-49 years of age when given
instructions for use without any additional guidance. (October 2023)
Rare Disease
Alexion, AstraZeneca Rare Disease presented new real-world and clinical data
at the European Committee for Treatment and Research in Multiple Sclerosis and
Americas Committee for Treatment and Research in Multiple Sclerosis
(ECTRIMS-ACTRIMS), offering further evidence to support the established safety
and efficacy of Soliris and Ultomiris in treating NMOSD.
Alexion, AstraZeneca Rare Disease presented new clinical data at the American
Society of Nephrology (ASN) for Ultomiris in IgAN 80 (#_ftn80) as well as
real-world data in aHUS.
Alexion, AstraZeneca Rare Disease presented new real-world and clinical data
at the American Association of Neuromuscular & Electrodiagnostic Medicine
(AANEM) Annual Meeting and Myasthenia Gravis Foundation of America Scientific
Session (MGFA SS). Data shared across 13 abstracts, reinforcing the safety and
efficacy of C5 inhibition in treating generalized myasthenia gravis (gMG).
Soliris
Event Commentary
Approval Japan Paediatric patients with gMG. (August 2023)
Approval China Adults with anti- aquaporin-4 antibody-positive NMOSD. (October 2023)
Ultomiris
Event Commentary
CRL US The US FDA issued a CRL 81 (#_ftn81) regarding the sBLA 82 (#_ftn82) for
Ultomiris for the treatment of adults with NMOSD. The sBLA included data from
the CHAMPION-NMOSD Phase III trial, which met the primary endpoint with a
safety profile consistent with the known profile of the medicine. The CRL
requested modifications to enhance the Ultomiris Risk Evaluation and
Mitigation Strategy to further validate patients' meningococcal vaccination
status or prophylactic administration of antibiotics prior to treatment.
(September 2023)
Presentation: ASN SANCTUARY Ultomiris demonstrated clinically meaningful efficacy and proof-of-concept as
a potential treatment for IgAN, based on rapid and sustained proteinuria
Phase II reduction. (November 2023)
vemircopan
Event Commentary
Termination ACH228-110 Phase II Trial discontinued due to lack of efficacy. Following an interim analysis,
vemircopan's ability to appropriately control intravascular haemolysis was not
adequately shown, due to significantly increased rates of breakthrough
haemolysis and high levels of LDH 83 (#_ftn83) . No new safety findings were
observed, and the safety profile of vemircopan has been favourable to date.
This decision does not impact ongoing Phase II trials. (September 2023)
gefurulimab
Event Commentary
Orphan Drug Designation US gefurulimab was granted orphan drug designation by the FDA for the treatment
of patients with gMG. (September 2023)
ALXN2220
Event Commentary
Orphan Drug Designation US ALXN2220 was granted orphan drug designation by the FDA for the treatment of
patients with ATTR-CM 84 (#_ftn84) . (September 2023)
Interim financial statements
Table 20: Condensed consolidated statement of comprehensive income: 9M 2023
For the nine months ended 30 September 2023 2022
$m $m
Total Revenue 85 (#_ftn85) 33,787 33,144
Product Sales 32,466 32,200
Alliance Revenue 1,004 504
Collaboration Revenue 317 440
Cost of sales (5,960) (9,491)
Gross profit 27,827 23,653
Distribution expense (394) (380)
Research and development expense (7,862) (7,137)
Selling, general and administrative expense (13,845) (13,798)
Other operating income and expense 1,233 325
Operating profit 6,959 2,663
Finance income 236 50
Finance expense (1,181) (986)
Share of after tax losses in associates and joint ventures (12) (4)
Profit before tax 6,002 1,723
Taxation (1,000) 668
Profit for the period 5,002 2,391
Other comprehensive income
Items that will not be reclassified to profit or loss
Remeasurement of the defined benefit pension liability (1) 1,283
Net gains/(losses) on equity investments measured at fair value through other 45 (21)
comprehensive income
Fair value movements related to own credit risk on bonds designated as fair 5 1
value through profit or loss
Tax on items that will not be reclassified to profit or loss - (291)
49 972
Items that may be reclassified subsequently to profit or loss
Foreign exchange arising on consolidation (201) (2,493)
Foreign exchange arising on designated liabilities in net investment hedges (63) (321)
Fair value movements on cash flow hedges 62 (214)
Fair value movements on cash flow hedges transferred to profit and loss 28 250
Fair value movements on derivatives designated in net investment hedges 47 33
Costs of hedging (3) (11)
Tax on items that may be reclassified subsequently to profit or loss (7) 95
(137) (2,661)
Other comprehensive loss, net of tax (88) (1,689)
Total comprehensive income for the period 4,914 702
Profit attributable to:
Owners of the Parent 4,995 2,387
Non-controlling interests 7 4
5,002 2,391
Total comprehensive income attributable to:
Owners of the Parent 4,907 701
Non-controlling interests 7 1
4,914 702
Basic earnings per $0.25 Ordinary Share $3.22 $1.54
Diluted earnings per $0.25 Ordinary Share $3.20 $1.53
Weighted average number of Ordinary Shares in issue (millions) 1,549 1,548
Diluted weighted average number of Ordinary Shares in issue (millions) 1,560 1,560
Table 21: Condensed consolidated statement of comprehensive income: Q3 2023
For the quarter ended 30 September 2023 2022
$m $m
Total Revenue(85) 11,492 10,982
Product Sales 11,018 10,590
Alliance Revenue 377 214
Collaboration Revenue 97 178
Cost of sales (2,095) (2,982)
Gross profit 9,397 8,000
Distribution expense (129) (126)
Research and development expense (2,584) (2,458)
Selling, general and administrative expense (4,800) (4,277)
Other operating income and expense 70 106
Operating profit 1,954 1,245
Finance income 101 15
Finance expense (392) (339)
Share of after tax (losses)/profits in associates and joint ventures (11) 1
Profit before tax 1,652 922
Taxation (274) 720
Profit for the period 1,378 1,642
Other comprehensive income
Items that will not be reclassified to profit or loss
Remeasurement of the defined benefit pension liability (8) 252
Net gains/(losses) on equity investments measured at fair value through other 93 (9)
comprehensive income
Fair value movements related to own credit risk on bonds designated as fair 1 (1)
value through profit or loss
Tax on items that will not be reclassified to profit or loss 5 (16)
91 226
Items that may be reclassified subsequently to profit or loss
Foreign exchange arising on consolidation (306) (1,167)
Foreign exchange arising on designated liabilities in net investment hedges 38 (126)
Fair value movements on cash flow hedges (27) (76)
Fair value movements on cash flow hedges transferred to profit and loss 99 119
Fair value movements on derivatives designated in net investment hedges 7 (1)
Costs of hedging (2) 2
Tax on items that may be reclassified subsequently to profit or loss (19) 49
(210) (1,200)
Other comprehensive loss, net of tax (119) (974)
Total comprehensive income for the period 1,259 668
Profit attributable to:
Owners of the Parent 1,374 1,640
Non-controlling interests 4 2
1,378 1,642
Total comprehensive income attributable to:
Owners of the Parent 1,255 667
Non-controlling interests 4 1
1,259 668
Basic earnings per $0.25 Ordinary Share $0.89 $1.06
Diluted earnings per $0.25 Ordinary Share $0.88 $1.05
Weighted average number of Ordinary Shares in issue (millions) 1,549 1,548
Diluted weighted average number of Ordinary Shares in issue (millions) 1,560 1,559
Table 22: Condensed consolidated statement of financial position
At 30 Sep At 31 Dec At 30 Sep
2023 2022 2022
$m $m $m
Assets
Non-current assets
Property, plant and equipment 8,723 8,507 8,352
Right-of-use assets 977 942 875
Goodwill 19,939 19,820 19,707
Intangible assets 37,687 39,307 39,585
Investments in associates and joint ventures 62 76 53
Other investments 1,228 1,066 1,049
Derivative financial instruments 151 74 112
Other receivables 761 835 792
Deferred tax assets 4,057 3,263 3,436
73,585 73,890 73,961
Current assets
Inventories 5,292 4,699 5,078
Trade and other receivables 11,300 10,521 9,336
Other investments 244 239 440
Derivative financial instruments 97 87 105
Intangible assets - - 82
Income tax receivable 697 731 725
Cash and cash equivalents 4,871 6,166 4,458
Assets held for sale - 150 -
22,501 22,593 20,224
Total assets 96,086 96,483 94,185
Liabilities
Current liabilities
Interest-bearing loans and borrowings (5,372) (5,314) (5,408)
Lease liabilities (235) (228) (210)
Trade and other payables (20,542) (19,040) (17,694)
Derivative financial instruments (83) (93) (68)
Provisions (1,193) (722) (377)
Income tax payable (1,163) (896) (1,093)
(28,588) (26,293) (24,850)
Non-current liabilities
Interest-bearing loans and borrowings (22,225) (22,965) (23,013)
Lease liabilities (744) (725) (668)
Derivative financial instruments (75) (164) (290)
Deferred tax liabilities (2,752) (2,944) (3,479)
Retirement benefit obligations (1,048) (1,168) (919)
Provisions (1,189) (896) (930)
Other payables (2,244) (4,270) (4,882)
(30,277) (33,132) (34,181)
Total liabilities (58,865) (59,425) (59,031)
Net assets 37,221 37,058 35,154
Equity
Capital and reserves attributable to equity holders of the Parent
Share capital 387 387 387
Share premium account 35,166 35,155 35,137
Other reserves 2,078 2,069 2,081
Retained earnings (434) (574) (2,471)
37,197 37,037 35,134
Non-controlling interests 24 21 20
Total equity 37,221 37,058 35,154
Table 23: Condensed consolidated statement of changes in equity
Share capital Share premium account Other reserves Retained earnings Total attributable to owners of the parent Non-controlling interests Total equity
$m $m $m $m $m $m $m
At 1 Jan 2022 387 35,126 2,045 1,710 39,268 19 39,287
Profit for the period - - - 2,387 2,387 4 2,391
Other comprehensive loss - - - (1,686) (1,686) (3) (1,689)
Transfer to other reserves - - 36 (36) - - -
Transactions with owners:
Dividends - - - (4,486) (4,486) - (4,486)
Issue of Ordinary Shares - 11 - - 11 - 11
Share-based payments charge for the period - - - 471 471 - 471
Settlement of share plan awards - - - (831) (831) - (831)
Net movement - 11 36 (4,181) (4,134) 1 (4,133)
At 30 Sep 2022 387 35,137 2,081 (2,471) 35,134 20 35,154
At 1 Jan 2023 387 35,155 2,069 (574) 37,037 21 37,058
Profit for the period - - - 4,995 4,995 7 5,002
Other comprehensive loss - - - (88) (88) - (88)
Transfer to other reserves - - 9 (9) - - -
Transactions with owners:
Dividends - - - (4,487) (4,487) - (4,487)
Dividends paid to non-controlling interests - - - - - (4) (4)
Issue of Ordinary Shares - 11 - - 11 - 11
Share-based payments charge for the period - - - 429 429 - 429
Settlement of share plan awards - - - (700) (700) - (700)
Net movement - 11 9 140 160 3 163
At 30 Sep 2023 387 35,166 2,078 (434) 37,197 24 37,221
Table 24: Condensed consolidated statement of cash flows
For the nine months ended 30 September 2023 2022
$m $m
Cash flows from operating activities
Profit before tax 6,002 1,723
Finance income and expense 945 936
Share of after tax losses of associates and joint ventures 12 4
Depreciation, amortisation and impairment 4,060 4,000
Decrease in working capital and short-term provisions 150 3,458
Gains on disposal of intangible assets (247) (88)
Fair value movements on contingent consideration arising from business 202 293
combinations
Non-cash and other movements (623) (973)
Cash generated from operations 10,501 9,353
Interest paid (826) (608)
Tax paid (1,710) (1,335)
Net cash inflow from operating activities 7,965 7,410
Cash flows from investing activities
Acquisition of subsidiaries, net of cash acquired (189) -
Payments upon vesting of employee share awards attributable to business (84) (297)
combinations
Payment of contingent consideration from business combinations (610) (570)
Purchase of property, plant and equipment (836) (719)
Disposal of property, plant and equipment 131 17
Purchase of intangible assets (1,996) (1,298)
Disposal of intangible assets 288 442
Movement in profit-participation liability 190 -
Purchase of non-current asset investments (109) (28)
Disposal of non-current asset investments 32 42
Movement in short-term investments, fixed deposits and other investing (12) (321)
instruments
Payments to associates and joint ventures - (5)
Interest received 208 26
Net cash outflow from investing activities (2,987) (2,711)
Net cash inflow before financing activities 4,978 4,699
Cash flows from financing activities
Proceeds from issue of share capital 12 11
Issue of loans and borrowings 3,816 -
Repayment of loans and borrowings (4,655) (1,261)
Dividends paid (4,479) (4,364)
Hedge contracts relating to dividend payments (19) (127)
Repayment of obligations under leases (194) (182)
Movement in short-term borrowings 110 378
Payment of Acerta Pharma share purchase liability (867) (920)
Net cash outflow from financing activities (6,276) (6,465)
Net decrease in Cash and cash equivalents in the period (1,298) (1,766)
Cash and cash equivalents at the beginning of the period 5,983 6,038
Exchange rate effects (66) (86)
Cash and cash equivalents at the end of the period 4,619 4,186
Cash and cash equivalents consist of:
Cash and cash equivalents 4,871 4,458
Overdrafts (252) (272)
4,619 4,186
Notes to the Interim financial statements
Note 1: Basis of preparation and accounting policies
These unaudited condensed consolidated Interim financial statements for the
nine months ended 30 September 2023 have been prepared in accordance with
International Accounting Standard 34, 'Interim Financial Reporting' (IAS 34),
as issued by the International Accounting Standards Board (IASB), IAS 34 as
adopted by the European Union, UK-adopted IAS 34 and the Disclosure Guidance
and Transparency Rules sourcebook of the United Kingdom's Financial Conduct
Authority and with the requirements of the Companies Act 2006 as applicable to
companies reporting under those standards.
The unaudited Interim financial statements for the nine months ended 30
September 2023 were approved by the Board of Directors for publication on 9
November 2023.
This results announcement does not constitute statutory accounts of the Group
within the meaning of sections
434(3) and 435(3) of the Companies Act 2006. The annual financial statements
of the Group for the year ended 31 December 2022 were prepared in accordance
with UK-adopted International Accounting Standards and with the requirements
of the Companies Act 2006. The annual financial statements also comply fully
with IFRSs as issued by the IASB and International Accounting Standards as
adopted by the European Union. Except for the estimation of the interim income
tax charge, the Interim financial statements have been prepared applying the
accounting policies that were applied in the preparation of the Group's
published consolidated financial statements for the year ended 31 December
2022.
The comparative figures for the financial year ended 31 December 2022 are not
the Group's statutory accounts for that financial year. Those accounts have
been reported on by the Group's auditors and have been delivered to the
registrar of companies; their report was (i) unqualified, (ii) did not include
a reference to any matters to which the auditors drew attention by way of
emphasis without qualifying their report, and (iii) did not contain a
statement under section 498(2) or (3) of the Companies Act 2006.
Alliance and Collaboration Revenues
Effective 1 January 2023, the Group has updated the presentation of Total
Revenue on the face of the Statement of Comprehensive Income to include
Alliance Revenue as a separate element to Collaboration Revenue. Alliance
Revenue, previously reported within Collaboration Revenue, comprises income
related to sales made by collaboration partners, where AstraZeneca is entitled
to a profit share, revenue share or royalties, which are recurring in nature
while the collaboration arrangement remains in place. Alliance Revenue does
not include Product Sales where AstraZeneca is leading commercialisation in a
territory. Collaboration Revenue arising from collaborative arrangements where
the Group retains a significant ongoing economic interest and receives upfront
amounts and event-triggered milestones, which arise from the licensing of
intellectual property, will continue to be reported as Collaboration Revenue.
In collaboration arrangements either AstraZeneca or the collaborator acts as
principal in sales to the end customer. Where AstraZeneca acts as principal,
we record 100% of sales to the end customer within Product Sales. The revised
presentation reflects the increasing importance of income arising from profit
share arrangements where collaboration partners are responsible for booking
revenues in some or all territories.
The comparative revenue reported in 9M 2023 relating to the nine months to 30
September 2022 has been retrospectively adjusted to reflect the new split of
Total Revenue, resulting in Alliance Revenue of $504m being reported for the
nine months to 30 September 2022, however the combined total of Alliance
Revenue and Collaboration Revenue is equal to the previously reported
Collaboration Revenue total for the nine months to 30 September 2022.
Going concern
The Group has considerable financial resources available. As at 30 September
2023, the Group has $11.8bn in financial resources (Cash and cash equivalent
balances of $4.9bn and undrawn committed bank facilities of $6.9bn available,
of which $2.0bn of the facilities are available until February 2025 and the
other $4.9bn are available until April 2026, with $5.6bn of borrowings due
within one year). These facilities contain no financial covenants and were
undrawn at 30 September 2023.
The Group's revenues are largely derived from sales of medicines covered by
patents which provide a relatively high level of resilience and predictability
to cash inflows, although government price interventions in response to
budgetary constraints are expected to continue to adversely affect revenues in
some of our significant markets. The Group, however, anticipates new revenue
streams from both recently launched medicines and those in development, and
the Group has a wide diversity of customers and suppliers across different
geographic areas.
Consequently, the Directors believe that, overall, the Group is well placed to
manage its business risks successfully. Accordingly, they continue to adopt
the going concern basis in preparing the Interim financial statements.
Legal proceedings
The information contained in Note 6 updates the disclosures concerning legal
proceedings and contingent liabilities in the Group's Annual Report and Form
20-F Information 2022
(https://www.astrazeneca.com/content/dam/az/Investor_Relations/annual-report-2022/pdf/AstraZeneca_AR_2022.pdf)
.
IAS 12 'Income Taxes'
On 25 May 2023, the IASB issued an amendment to IAS 12 'Income Taxes' to
clarify how the effects of the global minimum tax framework should be
accounted for and disclosed effective 1 January 2023. This was endorsed by the
UK Endorsement Board on 19 July 2023 and has been adopted by the Company for
2023 reporting. The Company is currently assessing the potential impact of
these rules upon its financial statements. The Company has applied the
exception to recognising and disclosing information about deferred tax assets
and liabilities related to Pillar 2 income taxes.
Note 2: Intangible assets
In accordance with IAS 36 'Impairment of Assets', reviews for triggers of
impairment or impairment reversals at an individual asset or cash generating
unit level were conducted, and impairment tests carried out where triggers
were identified. As a result, total impairment charges of $376m have been
recorded against intangible assets during the nine months ended 30 September
2023 (9M 2022: $44m net charge). Impairment charges in respect of medicines in
development were $359m (9M 2022: $61m net charge) including the $244m
impairment of the ALXN1840 intangible asset, following decision to discontinue
this development programme in Wilson's disease. Impairment charges in respect
of launched medicines were $17m (9M 2022: $nil).
As previously disclosed, on 16 January 2023 AstraZeneca completed the
acquisition of Neogene Therapeutics Inc. (Neogene), a global clinical-stage
biotechnology company pioneering the discovery, development and manufacturing
of next-generation T-cell receptor therapies (TCR-Ts). The purchase price
allocation exercise has completed, with the fair value of total consideration
determined at $267m. Intangible assets of $100m and goodwill of $158m were
recognised in the acquisition balance sheet, as well as a cash outflow of
$189m net of cash acquired. Future contingent milestones-based and
non-contingent consideration is payable to a maximum of $120m. Neogene's
results have been consolidated into the Group's results from 16 January 2023.
The acquisition of CinCor completed on 24 February 2023, recorded as an asset
acquisition, with consideration and net assets acquired of $1,268m, which
included intangible assets acquired of $780m, $424m of cash and cash
equivalents, and $75m of marketable securities. The Condensed consolidated
statement of cash flows includes a $1,204m payment for the intangible assets
which is presented net of the $424m cash and cash equivalents acquired within
Purchase of intangible assets, whilst the $75m increase in marketable
securities is presented within Movement in short-term investments, fixed
deposits and other investing instruments. Contingent consideration of up to
$496m could be paid on achievement of regulatory milestones, and will be
recognised when the associated milestones are triggered.
Note 3: Net debt
The table below provides an analysis of Net Debt and a reconciliation of Net
Cash Flow to the movement in Net Debt. The Group monitors Net Debt as part of
its capital-management policy as described in Note 28 of the Annual Report and
Form 20-F Information 2022
(https://www.astrazeneca.com/content/dam/az/Investor_Relations/annual-report-2022/pdf/AstraZeneca_AR_2022.pdf)
. Net Debt is a non-GAAP financial measure.
Table 25: Net debt
At 1 Jan 2023 Cash flow Acquisitions Non-cash Exchange movements At 30 Sep 2023
& other
$m $m $m $m $m $m
Non-current instalments of loans (22,965) (3,826) - 4,592 (26) (22,225)
Non-current instalments of leases (725) (1) (6) (23) 11 (744)
Total long-term debt (23,690) (3,827) (6) 4,569 (15) (22,969)
Current instalments of loans (4,964) 4,655 - (4,587) 39 (4,857)
Current instalments of leases (228) 215 (2) (230) 10 (235)
Bank collateral received (89) (95) - - - (184)
Other short-term borrowings excluding overdrafts (15) - - 14 (79)
(78)
Overdrafts (183) (69) - - - (252)
Total current debt (5,542) 4,691 (2) (4,817) 63 (5,607)
Gross borrowings (29,232) 864 (8) (248) 48 (28,576)
Net derivative financial instruments (96) 19 - 167 - 90
Net borrowings (29,328) 883 (8) (81) 48 (28,486)
Cash and cash equivalents 6,166 (1,229) - - (66) 4,871
Other investments - current 239 12 - - (7) 244
Cash and investments 6,405 (1,217) - - (73) 5,115
Net debt (22,923) (334) (8) (81) (25) (23,371)
Non-cash movements in the period include fair value adjustments under IFRS 9
Financial Instruments.
The Group has agreements with some bank counterparties whereby the parties
agree to post cash collateral on financial derivatives, for the benefit of the
other, equivalent to the market valuation of the derivative positions above a
predetermined threshold. The carrying value of such cash collateral held by
the Group at 30 September 2023 was $184m (31 December 2022: $89m) and the
carrying value of such cash collateral posted by the Group at 30 September
2023 was $175m (31 December 2022: $162m).
The equivalent GAAP measure to Net debt is 'liabilities arising from financing
activities', which excludes the amounts for cash and overdrafts, other
investments and non-financing derivatives shown above and includes the Acerta
Pharma share purchase liability of $819m (31 December 2022: $1,646m), which is
shown in current other payables.
Net debt increased by $448m in the nine months to 30 September 2023 to
$23,371m. Details of the committed undrawn bank facilities are disclosed
within the going concern section of Note 1.
During the quarter to 30 September 2023, Moody's upgraded the Company's
solicited long term credit rating from A3 to A2 and its short term rating from
P-2 to P-1. Standard and Poor's credit ratings were unchanged (long term: A;
short term: A-1).
Note 4: Financial Instruments
As detailed in the Group's most recent annual financial statements, the
principal financial instruments consist of derivative financial instruments,
other investments, trade and other receivables, cash and cash equivalents,
trade and other payables, lease liabilities and interest-bearing loans and
borrowings.
The Group has certain equity investments that are categorised as Level 3 in
the fair value hierarchy that are held at $281m at 30 September 2023 (31
December 2022: $186m) and for which fair value gains of $17m have been
recognised in the nine months ended 30 September 2023 (9M 2022: $50m). In the
absence of specific market data, these unlisted investments are held at fair
value based on the cost of investment and adjusting as necessary for
impairments and revaluations on new funding rounds, which are seen to
approximate the fair value. All other fair value gains and/or losses that are
presented in Net gains/(losses) on equity investments measured at fair value
through other comprehensive income in the Condensed consolidated statement of
comprehensive income for the nine months ended 30 September 2023 are Level 1
fair value measurements, valued based on quoted prices in active markets.
Financial instruments measured at fair value include $1,296m of other
investments, $3,551m held in money-market funds, $289m of loans designated at
fair value through profit or loss and $90m of derivatives as at 30 September
2023. With the exception of derivatives being Level 2 fair valued, certain
equity investments as described above and an equity warrant of $14m
categorised as Level 3, the aforementioned balances are Level 1 fair valued.
Financial instruments measured at amortised cost include $175m of cash
collateral pledged to counterparties. The total fair value of interest-bearing
loans and borrowings at 30 September 2023, which have a carrying value of
$28,576m in the Condensed consolidated statement of financial position, was
$26,576m.
As announced in April 2023, the contractual relationship between AstraZeneca
and Swedish Orphan Biovitrum AB (Sobi) relating to future sales of Beyfortus
(nirsevimab) in the US has been replaced by a royalty relationship between
Sanofi and Sobi. As a result, a non-current other payable representing
AstraZeneca's future obligations to Sobi was eliminated from AstraZeneca's
Statement of Financial Position in the quarter to 30 June 2023, and
AstraZeneca recorded a gain of $712m in Core Other operating income.
Table 26: Financial instruments - contingent consideration
2023 2022
Diabetes alliance Other Total Total
$m $m $m $m
At 1 January 2,124 98 2,222 2,865
Additions through business combinations - 60 60 -
Settlements (608) (2) (610) (570)
Disposals - - - (121)
Revaluations 229 (27) 202 293
Discount unwind 93 6 99 126
At 30 September 1,838 135 1,973 2,593
Contingent consideration arising from business combinations is fair valued
using decision-tree analysis, with key inputs including the probability of
success, consideration of potential delays and the expected levels of future
revenues.
The contingent consideration balance relating to BMS's share of the global
diabetes alliance of $1,838m (31 December 2022: $2,124m) would
increase/decrease by $184m with an increase/decrease in sales of 10%, as
compared with the current estimates.
Note 5: Pensions and other post-retirement benefit obligations
During the nine months ended 30 September 2023, AstraZeneca Pharmaceuticals
PLP terminated its main defined benefit pension plan. A total of $839m of
pension obligations were discharged, $142m of which was settled via a cash
payment to the participants and the remaining $697m was transferred to an
external insurer via a buy-out. At 30 September 2023, the plan contained
immaterial residual assets and obligations which are expected to be discharged
by the end of 2023, with minimal impact to the income statement.
Note 6: Legal proceedings and contingent liabilities
AstraZeneca is involved in various legal proceedings considered typical to its
business, including litigation and investigations, including Government
investigations, relating to product liability, commercial disputes,
infringement of intellectual property (IP) 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 2022 and the Interim Financial Statements for the
six months ended 30 June 2023 (the Disclosures).
As discussed in the Disclosures, the majority of claims involve highly complex
issues. Often these issues are subject to substantial uncertainties and,
therefore, the probability of a loss, if any, being sustained and/or an
estimate of the amount of any loss is difficult to ascertain.
Unless specifically identified below, AstraZeneca considers each of the claims
to represent a contingent liability or a contingent asset where the matter is
brought by AstraZeneca, and discloses information with respect to the nature
and facts of the cases in accordance with IAS 37.
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,
AstraZeneca records the loss absorbed or makes a provision for its best
estimate of the expected loss. The position could change over time and the
estimates that the Company made, and upon which the Company 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 Disclosures and herein.
AstraZeneca has full confidence in, and will vigorously defend and enforce,
its IP.
Matters disclosed in respect of the third quarter of 2023 and to 9 November
2023
Patent litigation
Legal proceedings brought against AZ considered to be contingent liabilities
Enhertu
US patent proceedings
In October 2020, Seagen Inc. (Seagen) filed a complaint against Daiichi Sankyo
Company, Limited (Daiichi Sankyo) in the US District Court for the Eastern
District of Texas (District Court) alleging that Enhertu infringes a Seagen
patent. AstraZeneca Pharmaceuticals LP co-commercialises Enhertu with Daiichi
Sankyo, Inc. in the US. After trial in April 2022, the jury found that the
patent was infringed and awarded Seagen $41.82m in past damages. In July 2022,
the District Court entered final judgment and declined to enhance damages on
the basis of willfulness. In October 2023, the District Court entered an
amended final judgment that requires Daiichi Sankyo to pay Seagen a royalty of
8% on US sales of Enhertu from April 1, 2022 through November 4, 2024, in
addition to the past damages previously awarded by the Court.
In December 2020 and January 2021, AstraZeneca and Daiichi Sankyo, Inc. filed
post-grant review (PGR) petitions with the US Patent and Trademark Office
(USPTO) alleging, inter alia, that the Seagen patent is invalid for lack of
written description and enablement. The USPTO initially declined to institute
the PGRs, but, in April 2022, the USPTO granted the rehearing requests,
instituting both PGR petitions. Seagen subsequently disclaimed all patent
claims at issue in one of the PGR proceedings. In July 2022, the USPTO
reversed its institution decision and declined to institute the other PGR
petition. AstraZeneca and Daiichi Sankyo requested reconsideration of the
decision not to institute review of the patent. In February 2023, the USPTO
reinstituted the PGR proceeding. An oral hearing took place in August 2023.
The parties await a decision.
Legal proceedings brought by AZ considered to be contingent assets
Faslodex
Patent proceedings outside the US
In 2021 in Japan, AstraZeneca received notice from the Japan Patent Office
(JPO) that Sandoz K.K. (Sandoz) and Sun Pharma Japan Ltd. (Sun) were seeking
to invalidate the Faslodex formulation patent. AstraZeneca defended the
challenged patent, and Sun withdrew from the JPO patent challenge. In July
2023, the JPO issued a final decision upholding various claims of the
challenged patent and determining that other patent claims were invalid. In
August 2023, Sandoz appealed the JPO decision to the Japan IP High Court.
Calquence
US patent proceedings
In February 2022, in response to Paragraph IV notices from multiple ANDA
filers, AstraZeneca filed patent infringement lawsuits in the US District
Court for the District of Delaware. In its complaint, AstraZeneca alleges that
a generic version of Calquence, if approved and marketed, would infringe
patents listed in the US FDA Orange Book with reference to Calquence that are
owned or licensed by AstraZeneca. Trial has been scheduled for March 2025.
In February 2023, Sandoz Inc. filed a petition for inter partes review with
the US Patent and Trademark Office (USPTO) of certain Calquence patent claims.
AstraZeneca has asserted claims for patent infringement against Sandoz and
other defendants in the US ANDA litigation. In August 2023, the Patent Trial
and Appeal Board issued a decision denying institution of inter partes
review.
Product liability litigation
Legal proceedings brought against AZ for which a provision has been taken
Nexium and Losec/Prilosec
US proceedings
In the US, AstraZeneca is defending various lawsuits brought in federal and
state courts involving multiple plaintiffs claiming that they have been
diagnosed with various injuries following treatment with proton pump
inhibitors (PPIs), including Nexium and Prilosec. The vast majority of those
lawsuits related to allegations of kidney injuries. In August 2017, the
pending federal court cases were consolidated in a multidistrict litigation
(MDL) proceeding in the US District Court for the District of New Jersey for
pre-trial purposes. A bellwether trial had been scheduled for October 2023,
with subsequent bellwether trials scheduled for November 2023 and January
2024. In addition to the MDL cases, there were cases filed in Delaware and New
Jersey state courts.
In addition, AstraZeneca has been defending lawsuits involving allegations of
gastric cancer following treatment with PPIs. One such claim was filed in the
US District Court for the Middle District of Louisiana and is scheduled to go
to trial in April 2024.
In October 2023, AstraZeneca resolved all pending claims in the MDL, as well
as all of the pending claims in Delaware and New Jersey state courts, for
$425m, for which a current provision has been taken. A single case remains
pending in the US District Court for the Middle District of Louisiana.
Legal proceedings brought against AZ considered to be contingent liabilities
Farxiga and Xigduo XR
US proceedings
In several jurisdictions in the US, AstraZeneca has been named as a defendant
in lawsuits involving plaintiffs claiming physical injury, including
Fournier's Gangrene and necrotising fasciitis, from treatment with Farxiga
and/or Xigduo XR. A majority of these claims are filed in Delaware state court
and remain pending. In September of 2023, the parties resolved by settlement
one case, filed in state court in Minnesota, previously scheduled for trial in
October 2023.
Commercial litigation
Legal proceedings brought against AZ for which a provision has been taken
Alexion Shareholder Litigation (US)
In December 2016, putative securities class action lawsuits were filed in the
US District Court for the District of Connecticut (the District Court) against
Alexion and certain officers and directors, on behalf of purchasers of Alexion
publicly traded securities during the period 30 January 2014 through 26 May
2017. The amended complaint alleges that defendants engaged in securities
fraud, including by making misrepresentations and omissions in its public
disclosures concerning Alexion's Soliris sales practices, management changes,
and related investigations. In August 2021, the District Court issued a
decision denying in part Defendants' motion to dismiss the matter. The Court
granted plaintiffs' motion for class certification in April 2023. In August
2023, the parties reached a settlement in principle of this matter. In
September 2023, the court granted preliminary approval of the class
settlement. The court scheduled a hearing in December 2023 to rule on final
approval. A provision has been recognised in the quarter.
Legal proceedings brought by AZ considered to be contingent assets
US 340B litigations and proceedings
US proceedings
AstraZeneca has been involved in several matters relating to its contract
pharmacy recognition policy under the 340B Drug Pricing Program in the US.
In August 2023, AstraZeneca filed a lawsuit against the Attorney General of
the State of Louisiana alleging that the Louisiana's 340B statute, which
requires manufacturers to recognize an unlimited number of contract
pharmacies, is preempted on several grounds and violates the Contracts Clause
of the U.S. Constitution.
In September 2023, the Arkansas Insurance Department sent AstraZeneca an
administrative complaint concerning compliance with Arkansas's 340B Statute,
which requires manufacturers to recognize an unlimited number of contract
pharmacies. AstraZeneca response is due in November 2023.
Inflation Reduction Act Litigation
US proceedings
In August 2023, AstraZeneca filed a lawsuit in the US District Court for the
District of Delaware challenging aspects of the drug price negotiation
provisions of the Inflation Reduction Act and the implementing guidance and
regulations promulgated by the Department of Health and Human Services.
Government investigations/proceedings
Legal proceedings brought against AZ considered to be contingent liabilities
340B Qui Tam
US Proceedings
In July 2023, AstraZeneca was served with an unsealed civil lawsuit brought by
a qui tam relator on behalf of the United States, several states, and the
District of Columbia in the United States District Court for Central District
of California. The complaint alleges that AstraZeneca violated the False
Claims Act and State-Law Counterparts. In September 2023, AstraZeneca filed a
motion to dismiss the relator's claims.
Subsequent events
In November, AstraZeneca announced a collaboration and investment agreement
with Cellectis, a clinical-stage biotechnology company, to accelerate the
development of next generation therapeutics in areas of high unmet need,
including oncology, immunology and rare diseases. In Q4 2023, under the terms
of the collaboration agreement, Cellectis will receive an initial payment of
$105m from AstraZeneca, which comprises a $25m upfront cash payment and an
$80m equity investment. AstraZeneca expects to treat its investment in
Cellectis as an associate.
In November, AstraZeneca and Eccogene entered into an exclusive licence
agreement for ECC5004, an investigational oral once-daily GLP-1RA for the
treatment of obesity, type-2 diabetes and other cardiometabolic conditions.
Under the terms of the agreement, AstraZeneca obtained exclusive global rights
for development and commercialisation in all territories except China where
Eccogene has the right to co-develop and co-commercialise alongside
AstraZeneca. Eccogene will receive an initial upfront payment of $185m and up
to an additional $1.825bn in future clinical, regulatory, and commercial
milestones and tiered royalties.
Note 7
Table 27: 9M 2023 - Product Sales year-on-year analysis
86 (#_ftn86)
World US Emerging Markets Europe Established RoW
$m Act % chg CER % chg $m % chg $m Act % chg CER % chg $m Act % chg CER % chg $m Act % chg CER % chg
Oncology 12,692 17 20 5,652 20 2,925 7 15 2,428 19 19 1,687 18 28
Tagrisso 4,380 7 10 1,679 14 1,261 4 11 821 6 6 619 (4) 5
Imfinzi 3,102 53 56 1,708 55 270 20 31 547 36 35 577 90 n/m
Lynparza 2,070 6 9 902 1 409 14 24 543 10 10 216 7 16
Calquence 1,839 25 26 1,337 12 69 n/m n/m 353 76 77 80 64 74
Enhertu 178 n/m n/m - - 121 n/m n/m 40 n/m n/m 17 n/m n/m
Orpathys 33 (3) 4 - - 33 (3) 4 - - - - - -
Zoladex 699 (3) 5 12 9 521 3 11 98 (2) (1) 68 (31) (24)
Faslodex 217 (16) (10) 9 (38) 113 (6) - 22 (50) (50) 73 (8) -
Others 174 (36) (32) 5 (36) 128 (38) (34) 4 (41) (40) 37 (29) (22)
BioPharmaceuticals: CVRM 7,887 14 18 1,972 11 3,507 10 18 1,825 29 29 583 10 19
Farxiga 4,358 36 40 1,000 34 1,653 35 43 1,356 42 41 349 26 36
Brilinta 996 (2) - 551 2 224 1 10 203 (5) (5) 18 (54) (51)
Lokelma 300 44 49 156 28 37 n/m n/m 41 98 99 66 32 44
roxadustat 208 41 51 - - 208 41 51 - - - - - -
Andexxa 129 16 19 57 (8) - - - 44 51 51 28 40 54
Crestor 860 4 11 40 (19) 678 8 15 41 38 38 101 (11) (4)
Seloken/Toprol-XL 496 (30) (23) - - 482 (30) (24) 8 (19) (19) 6 (18) (13)
Onglyza 180 (12) (8) 44 (26) 99 1 9 25 (17) (17) 12 (30) (27)
Bydureon 123 (40) (40) 101 (43) 2 15 14 20 (30) (30) - - -
Others 237 (16) (13) 23 (13) 124 (19) (13) 87 (10) (10) 3 (52) (49)
BioPharmaceuticals: R&I 4,517 5 8 1,900 (3) 1,315 19 29 847 7 7 455 (1) 6
Symbicort 1,842 (4) (1) 589 (18) 600 26 36 408 (8) (8) 245 (12) (7)
Fasenra 1,134 12 13 718 11 48 62 69 262 14 14 106 (1) 6
Breztri 478 69 73 263 60 123 73 86 55 n/m n/m 37 48 58
Saphnelo 191 n/m n/m 178 n/m 1 n/m n/m 5 n/m n/m 7 n/m n/m
Tezspire 51 n/m n/m - - - - - 28 n/m n/m 23 n/m n/m
Pulmicort 493 3 10 22 (58) 392 16 24 49 (1) - 30 (18) (13)
Bevespi 42 (2) (2) 24 (23) 5 21 32 12 70 70 1 59 10
Daliresp/Daxas 41 (74) (74) 32 (79) 2 (23) (10) 6 (9) (9) 1 3 (25)
Others 245 (30) (27) 74 (44) 144 (20) (14) 22 (35) (34) 5 (4) 2
BioPharmaceuticals: V&I 667 (82) (81) 15 (98) 181 (82) (81) 236 (66) (66) 235 (76) (73)
COVID-19 mAbs 126 (91) (90) - n/m 5 (97) (97) 7 (97) (96) 114 (51) (45)
Vaxzevria 28 (98) (98) - n/m 18 (97) (97) 10 (97) (97) - n/m n/m
Beyfortus 52 n/m n/m - - - - - 52 - - - - -
Synagis 383 - 6 (1) n/m 158 9 15 109 (12) (9) 117 2 11
FluMist 78 32 28 16 44 - n/m n/m 58 28 22 4 79 71
Rare Disease 5,793 11 12 3,469 9 487 54 68 1,165 8 8 672 1 9
Soliris 2,429 (17) (15) 1,313 (22) 338 55 74 530 (15) (15) 248 (36) (31)
Ultomiris 2,141 56 58 1,260 63 47 38 39 495 43 42 339 54 68
Strensiq 847 23 24 690 26 29 14 16 64 9 8 64 12 22
Koselugo 246 65 65 144 26 49 n/m n/m 38 n/m n/m 15 n/m n/m
Kanuma 130 17 18 62 11 24 53 55 38 13 12 6 4 12
Other medicines 910 (27) (22) 104 (7) 580 (5) 3 67 (29) (29) 159 (63) (60)
Nexium 735 (25) (20) 88 (6) 458 5 14 36 (1) (2) 153 (63) (60)
Others 175 (33) (31) 16 (13) 122 (29) (25) 31 (47) (47) 6 (54) (50)
Total Product Sales 32,466 1 4 13,112 3 8,995 1 8 6,568 7 7 3,791 (16) (9)
Table 28: Q3 2023 - Product Sales year-on-year analysis
87 (#_ftn87)
World US Emerging Markets Europe Established RoW
$m Act % chg CER % chg $m % chg $m Act % chg CER % chg $m Act % chg CER % chg $m Act % chg CER % chg
Oncology 4,389 16 17 1,986 16 971 4 13 849 22 15 583 28 35
Tagrisso 1,465 5 6 577 11 409 1 8 281 5 (1) 198 (3) 2
Imfinzi 1,126 53 54 610 48 87 (4) 7 208 54 45 221 n/m n/m
Lynparza 702 7 8 322 3 131 12 26 178 8 2 71 11 16
Calquence 654 16 15 468 2 28 n/m n/m 128 63 54 30 65 72
Enhertu 73 n/m n/m - - 48 n/m n/m 16 n/m n/m 9 n/m n/m
Orpathys 12 6 13 - - 12 6 13 - - - - - -
Zoladex 239 - 5 5 29 182 4 11 31 (1) (6) 21 (29) (25)
Faslodex 64 (21) (16) 3 (41) 32 (19) (13) 6 (53) (55) 23 (5) -
Others 54 (33) (30) 1 (59) 42 (34) (32) 1 11 11 10 (30) (22)
BioPharmaceuticals: CVRM 2,683 14 16 690 9 1,161 7 15 657 40 32 175 6 10
Farxiga 1,554 41 41 366 31 579 41 48 506 54 45 103 24 29
Brilinta 331 (2) (1) 193 4 64 (16) (4) 68 4 (2) 6 (45) (46)
Lokelma 102 30 31 51 15 13 39 48 16 97 87 22 31 38
roxadustat 74 31 39 - - 74 30 39 - - - - - -
Andexxa 40 (3) (5) 20 - - - - 15 32 20 5 (50) (47)
Crestor 275 (1) 6 14 (10) 219 2 9 9 6 3 33 (11) (7)
Seloken/Toprol-XL 153 (36) (29) - - 149 (36) (29) 2 (45) (45) 2 (4) (18)
Onglyza 53 (20) (17) 9 (57) 33 - 9 8 (9) (16) 3 (27) (25)
Bydureon 35 (48) (49) 28 (52) 1 97 90 6 (25) (30) - - -
Others 66 (23) (21) 9 15 29 (40) (37) 27 (1) (2) 1 (42) (39)
BioPharmaceuticals: R&I 1,451 2 3 609 (8) 422 14 23 266 9 2 154 3 7
Symbicort 555 (12) (10) 156 (34) 195 15 24 123 (7) (13) 81 (11) (8)
Fasenra 389 10 10 249 9 19 56 67 86 12 5 35 1 4
Breztri 171 66 69 98 69 42 51 62 19 n/m n/m 12 37 46
Saphnelo 76 n/m n/m 71 n/m - - - 2 n/m n/m 3 n/m n/m
Tezspire 21 n/m n/m - - - - - 11 n/m n/m 10 n/m n/m
Pulmicort 148 2 7 5 (69) 119 16 24 13 (11) (16) 11 (8) (5)
Bevespi 13 (5) (4) 8 (23) 2 (2) 7 3 77 72 - - -
Daliresp/Daxas 11 (79) (79) 8 (83) - (36) (2) 2 (2) (18) 1 n/m -
Others 67 (31) (28) 14 (55) 45 (20) (14) 7 (14) (19) 1 (7) 7
BioPharmaceuticals: V&I 224 (74) (74) 15 (95) 32 (76) (75) 122 (33) (35) 55 (78) (77)
COVID-19 mAbs - n/m n/m - n/m - n/m n/m - n/m n/m - n/m n/m
Vaxzevria - n/m n/m - - - n/m n/m - n/m n/m - n/m n/m
Beyfortus 50 n/m n/m - - - - - 50 - - - - -
Synagis 99 (5) (1) - - 32 (13) (7) 16 (4) (10) 51 1 6
FluMist 75 28 23 15 41 - - - 56 22 16 4 81 76
Rare Disease 1,974 13 14 1,179 9 163 49 70 397 15 8 235 16 22
Soliris 781 (13) (12) 420 (20) 124 47 71 163 (14) (19) 74 (28) (26)
Ultomiris 777 50 49 445 41 17 n/m n/m 184 51 41 131 70 78
Strensiq 285 20 21 237 23 5 (32) (10) 22 17 8 21 13 19
Koselugo 87 81 81 54 51 11 51 69 15 n/m n/m 7 n/m n/m
Kanuma 44 21 19 23 27 6 (4) (2) 13 31 23 2 (10) (5)
Other medicines 297 (27) (22) 36 (3) 190 (11) (4) 19 (32) (34) 52 (59) (56)
Nexium 244 (22) (17) 29 (6) 153 3 13 11 5 (2) 51 (59) (56)
Others 53 (43) (41) 7 10 37 (44) (41) 8 (54) (53) 1 (66) (57)
Total Product Sales 11,018 4 5 4,515 2 2,939 3 12 2,310 18 11 1,254 (7) (3)
Table 29: Alliance Revenue
9M 2023 9M 2022
$m $m
Enhertu 741 335
Tezspire 179 42
Vaxzevria: royalties - 67
Other royalty income 59 51
Other Alliance Revenue 25 9
Total 1,004 504
Table 30: Collaboration Revenue
9M 2023 9M 2022
$m $m
Lynparza: regulatory milestones - 250
COVID-19 mAbs: licence fees 180 -
Farxiga: sales milestones 28 -
tralokinumab: sales milestones 20 110
Beyfortus: regulatory milestones 71 -
Other Collaboration Revenue 18 80
Total 317 440
Table 31: Other operating income and expense
9M 2023 9M 2022
$m $m
brazikumab licence termination funding 75 104
Divestment of rights to Plendil - 61
Divestment of US rights to Pulmicort Flexhaler 241 -
Update to the contractual relationships for Beyfortus (nirsevimab) 712 -
Other 205 160
Total 1,233 325
Other shareholder information
Financial calendar
Announcement of full year and fourth quarter 2023 results: 8 February 2024
Dividends are normally paid as follows:
First interim: Announced with the half year results and paid
in September
Second interim: Announced with full year results and paid in March
Contacts
For details on how to contact the Investor Relations Team, please click here
(https://www.astrazeneca.com/investor-relations.html#Contacts) . For Media
contacts, click here (https://www.astrazeneca.com/media-centre/contacts.html)
.
Addresses for correspondence
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Deutsche Bank Trust Company Americas
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Trademarks
Trademarks of the AstraZeneca group of companies appear throughout this
document in italics. Medical publications also appear throughout the 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 Arimidex and Casodex, owned by AstraZeneca or Juvisé (depending on
geography); Beyfortus, a trademark of Sanofi Pasteur Inc.; Enhertu, a
trademark of Daiichi Sankyo; Losec, owned by AstraZeneca or Cheplapharm
(depending upon geography); Seloken, owned by AstraZeneca or Taiyo Pharma Co.,
Ltd (depending on geography); Synagis, owned by AstraZeneca or Sobi aka
Swedish Orphan Biovitrum AB (publ). (depending on geography); and Tezspire, a
trademark of Amgen, Inc.
Information on or accessible through AstraZeneca's websites, including
astrazeneca.com (https://www.astrazeneca.com/) , does not form part of and is
not incorporated into this announcement.
AstraZeneca
AstraZeneca (LSE/STO/Nasdaq: AZN) is a global, science-led biopharmaceutical
company that focuses on the discovery, development, and commercialisation of
prescription medicines in Oncology, Rare Disease, and BioPharmaceuticals,
including Cardiovascular, Renal & Metabolism, and Respiratory &
Immunology. Based in Cambridge, UK, AstraZeneca operates in over 100 countries
and its innovative medicines are used by millions of patients worldwide.
Please visit astrazeneca.com (http://www.astrazeneca.com/) and follow the
Company on Twitter @AstraZeneca (http://www.twitter.com/AstraZeneca) .
Cautionary statements regarding forward-looking statements
In order, among other things, to utilise the 'safe harbour' provisions of the
US Private Securities Litigation Reform Act of 1995, AstraZeneca (hereafter
'the Group') provides the following cautionary statement:
This document contains certain forward-looking statements with respect to the
operations, performance and financial condition of the Group, including, among
other things, statements about expected revenues, margins, earnings per share
or other financial or other measures. Although the Group believes its
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 this
document and the Group undertakes no obligation to update these
forward-looking statements. The Group identifies 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 the Group's control, include, among
other things:
‒ the risk of failure or delay in delivery of pipeline or launch of
new medicines
‒ the risk of failure to meet regulatory or ethical requirements for
medicine development or approval
‒ the risk of failures or delays in the quality or execution of the
Group's commercial strategies
‒ the risk of pricing, affordability, access and competitive pressures
‒ the risk of failure to maintain supply of compliant, quality
medicines
‒ the risk of illegal trade in the Group's medicines
‒ the impact of reliance on third-party goods and services
‒ the risk of failure in information technology or cybersecurity
‒ the risk of failure of critical processes
‒ the risk of failure to collect and manage data in line with legal
and regulatory requirements and strategic objectives
‒ the risk of failure to attract, develop, engage and retain a
diverse, talented and capable workforce
‒ the risk of failure to meet regulatory or ethical expectations on
environmental impact, including climate change
‒ the risk of the safety and efficacy of marketed medicines being
questioned
‒ the risk of adverse outcome of litigation and/or governmental
investigations
‒ intellectual property-related risks to our products
‒ the risk of failure to achieve strategic plans or meet targets or
expectations
‒ the impact that global and/or geopolitical events may have or
continue to have on these risks, on the Group's ability to continue to
mitigate these risks, and on the Group's operations, financial results or
financial condition
‒ the risk of failure in financial control or the occurrence of fraud
‒ the risk of unexpected deterioration in the Group's financial
position
Nothing in this document, or any related presentation/webcast, should be
construed as a profit forecast.
- End of document -
1 (#_ftnref1) Constant exchange rates. The differences between Actual Change
and CER Change are due to foreign exchange movements between periods in 2023
vs. 2022. CER financial measures are not accounted for according to generally
accepted accounting principles (GAAP) because they remove the effects of
currency movements from Reported results.
2 (#_ftnref2) Effective 1 January 2023, the Group has updated the
presentation of Total Revenue. For further details of the presentation of
Alliance Revenue and Collaboration Revenue, see the Basis of preparation and
accounting policies section of the Notes to the Interim financial statements
section.
3 (#_ftnref3) Reported financial measures are the financial results
presented in accordance with UK-adopted International Accounting Standards and
International Financial Reporting Standards (IFRSs) as issued by the
International Accounting Standards Board (IASB) and International Accounting
Standards as adopted by the European Union.
4 (#_ftnref4) Earnings per share.
5 (#_ftnref5) Core financial measures are adjusted to exclude certain items.
The differences between Reported and Core measures are primarily due to costs
relating to the acquisition of Alexion, amortisation of intangibles,
impairments, legal settlements and restructuring charges. A full
reconciliation between Reported EPS and Core EPS is provided in Table 13 and
Table 14 in the Financial performance section of this document.
6 (#_ftnref6) The COVID-19 medicines are Vaxzevria, Evusheld, and AZD3152 -
the COVID-19 antibody currently in development.
7 (#_ftnref7) Cardiovascular, Renal and Metabolism.
8 (#_ftnref8) Respiratory & Immunology.
9 (#_ftnref9) The calculation of Reported and Core Product Sales Gross
Margin (formerly termed as Gross Margin) excludes the impact of Alliance
Revenue and Collaboration Revenue.
10 (#_ftnref10) Programmed cell death protein
1/cytotoxic T-lymphocyte-associated protein 4.
11 (#_ftnref11) Glucagon-like peptide 1 receptor
agonist.
12 (#_ftnref12) Hormone receptor.
13 (#_ftnref13) Eosinophilic granulomatosis with
polyangiitis.
14 (#_ftnref14) Human epidermal growth factor
receptor 2.
15 (#_ftnref15) Relapsed or refractory chronic
lymphocytic leukaemia.
16 (#_ftnref16) Neuromyelitis optica spectrum
disorder.
17 (#_ftnref17) Epidermal growth factor receptor
mutation.
18 (#_ftnref18) Non-small cell lung cancer.
19 (#_ftnref19) Vaccines & Immune Therapies.
20 (#_ftnref20) In Table 2, the plus and minus
symbols denote the directional impact of the item being discussed, e.g. a '+'
symbol next to an R&D expense comment indicates that the item increased
the R&D expense relative to the prior year.
21 (#_ftnref21) Cost of goods sold.
22 (#_ftnref22) Income from disposals of assets and
businesses, where the Group does not retain a significant ongoing economic
interest, continue to be recorded in Other operating income and expense in the
Company's financial statements.
23 (#_ftnref23) Metastatic castration-resistant
prostate cancer.
24 (#_ftnref24) Human epidermal growth factor
receptor mutant.
25 (#_ftnref25) Chronic lymphocytic leukaemia.
26 (#_ftnref26) Heart failure with preserved ejection
fraction.
27 (#_ftnref27) Atypical haemolytic uraemic syndrome.
28 (#_ftnref28) Paroxysmal nocturnal haemoglobinuria.
29 (#_ftnref29) Programmed death-ligand 1.
30 (#_ftnref30) Chronic kidney disease.
31 (#_ftnref31) Chronic obstructive pulmonary
disease.
32 (#_ftnref32) Pressure metered dose inhaler.
33 (#_ftnref33) Product Sales shown in the Imfinzi line include Product
Sales from Imjudo.
34 (#_ftnref34) COVID-19 monoclonal antibodies.
35 (#_ftnref35) National reimbursement drug list.
36 (#_ftnref36) Biliary tract cancer.
37 (#_ftnref37) Hepatocellular carcinoma.
38 (#_ftnref38) Small cell lung cancer.
39 (#_ftnref39) Poly ADP ribose polymerase.
40 (#_ftnref40) Platinum sensitive relapse.
41 (#_ftnref41) Breast cancer gene mutation.
42 (#_ftnref42) Germline (hereditary) breast cancer gene mutation.
43 (#_ftnref43) Bruton tyrosine kinase inhibitor.
44 (#_ftnref44) Sodium-glucose cotransporter 2.
45 (#_ftnref45) Type-2 diabetes.
46 (#_ftnref46) Heart failure with reserved ejection fraction.
47 (#_ftnref47) European Society of Cardiology.
48 (#_ftnref48) Fixed dose combination.
49 (#_ftnref49) 'New-to-brand' share represents a medicine's share in the
dynamic market.
50 (#_ftnref50) Inhaled corticosteroid.
51 (#_ftnref51) Long-acting beta-agonist.
52 (#_ftnref52) Respiratory syncytial virus.
53 (#_ftnref53) Complement component 5.
54 (#_ftnref54) Generalised myasthenia gravis.
55 (#_ftnref55) Other Operating Income.
56 (#_ftnref56) Other adjustments include fair-value adjustments relating to
contingent consideration on business combinations and other
acquisition-related liabilities, discount unwind on acquisition-related
liabilities (see Note 4) and provision movements related to certain legal
matters, including a $510m charge to provisions relating to a legal settlement
with BMS and Ono and a $425m charge to provisions relating to a multidistrict
litigation proceeding legal settlement in 9M 2023 (see Note 6).
57 (#_ftnref57) Other adjustments include fair-value adjustments relating to
contingent consideration on business combinations and other
acquisition-related liabilities, discount unwind on acquisition-related
liabilities (see Note 4) and provision movements related to certain legal
matters, including a $425m charge to provisions relating to a multidistrict
litigation proceeding legal settlement in Q3 2023 (see Note 6).
58 (#_ftnref58) Securities Exchange Commission.
59 (#_ftnref59) Based on best prevailing assumptions around currency
profiles.
60 (#_ftnref60) Based on average daily spot rates 1 Jan 2022 to 31 Dec 2022.
61 (#_ftnref61) Based on average daily spot rates 1 Jan 2023 to 30 Sep 2023.
62 (#_ftnref62) Based on average daily spot rates 1 Sep 2023 to 30 Sep 2023.
63 (#_ftnref63) Change vs. the average spot rate for the previous year
64 (#_ftnref64) Other currencies include AUD, BRL, CAD, KRW and RUB.
65 (#_ftnref65) Progression free survival.
66 (#_ftnref66) Central nervous system.
67 (#_ftnref67) Fluorouracil, oxaliplatin and docetaxel .
68 (#_ftnref68) Pathologic complete response.
69 (#_ftnref69) Gastro oesophageal junction.
70 (#_ftnref70) Transarterial chemoembolisation.
71 (#_ftnref71) Overall survival.
72 (#_ftnref72) Immunohistochemistry.
73 (#_ftnref73) v-erb-b2 avian erythroblastic leukemia viral oncogene
homolog 2.
74 (#_ftnref74) Overall response rate.
75 (#_ftnref75) Small lymphocytic lymphoma.
76 (#_ftnref76) Antibody drug conjugate.
77 (#_ftnref77) Heart failure.
78 (#_ftnref78) Transthyretin-mediated amyloid cardiomyopathy and
transthyretin-mediated amyloid polyneuropathy
79 (#_ftnref79) Severe eosinophilic asthma.
80 (#_ftnref80) Immunoglobulin A neuropathy.
81 (#_ftnref81) Compete Response Letter.
82 (#_ftnref82) Supplemental biologics license application.
83 (#_ftnref83) Lactic dehydrogenase.
84 (#_ftnref84) Transthyretin-mediated amyloid cardiomyopathy.
85 (#_ftnref85) Effective 1 January 2023, the Group has updated the
presentation of Total Revenue. See Note 1 for further details of the
presentation of Alliance Revenue.
86 (#_ftnref86) The table provides an analysis of year-on-year Product
Sales, with Actual and CER growth rates reflecting year-on-year growth. Due to
rounding, the sum of a number of dollar values and percentages may not agree
to totals.
87 (#_ftnref87) The table provides an analysis of year-on-year Product
Sales, with Actual and CER growth rates reflecting year-on-year growth. Due to
rounding, the sum of a number of dollar values and percentages may not agree
to totals.
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