REG - AstraZeneca PLC - Half Yearly Report <Origin Href="QuoteRef">AZN.L</Origin> - Part 3
30/07/2015 07:13
- Part 3: For the preceding part double click ID:nRSd5111Ub
1 253 7 (1,456) (1,195) (6) (1,201)
At 30 Jun 2014 316 4,236 1,973 15,504 22,029 23 22,052
Share Share Other Retained Total Non- Total
capital premium reserves* earnings $m controlling equity
$m account $m $m interests $m
$m $m
At 1 Jan 2015 316 4,261 2,021 13,029 19,627 19 19,646
Profit for the period - - - 1,247 1,247 1 1,248
Other comprehensive income - - - (8) (8) - (8)
Transfer to other reserves - - 12 (12) - - -
Transactions with owners:
Dividends - - - (2,400) (2,400) - (2,400)
Issue of Ordinary Shares - 20 - - 20 - 20
Share-based payments - - - (207) (207) - (207)
Net movement - 20 12 (1,380) (1,348) 1 (1,347)
At 30 Jun 2015 316 4,281 2,033 11,649 18,279 20 18,299
* Other reserves include the capital redemption reserve and the merger reserve.
Responsibility Statement of the Directors in Respect of the Half-Yearly Financial Report
We confirm that to the best of our knowledge:
· the condensed set of financial statements has been prepared in accordance with IAS 34 Interim Financial Reporting as
adopted by the European Union and as issued by the International Accounting Standards Board;
· the half-yearly management report includes a fair review of the information required by:
(a) DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and
(b) DTR 4.2.8R of the Disclosure and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the enterprise during that period; and any changes in the related party transactions described in the last annual report that could do so.
The Board
The Board of Directors that served during all or part of the six-month period to 30 June 2015 and their respective
responsibilities can be found on pages 28 and 29 of the AstraZeneca Annual Report and Form 20-F Information 2014, with the
exception of Cori Bargmann who was elected as Non-Executive Director and appointed as a member of the Science Committee on
24 April 2015. Also on 24 April 2015, Rudy Markham became Senior independent Non-Executive Director, Graham Chipchase
became Chairman of the Remuneration Committee and a member of the Nomination and Governance Committee, Bruce Burlington
became Chairman of the Science Committee and a member of the Nomination and Governance Committee and Geneviève Berger took
on the oversight of sustainability matters on behalf of the Board.
Approved by the Board and signed on its behalf by
Pascal Soriot
Chief Executive Officer
30 July 2015
Independent Review Report to AstraZeneca PLC
Introduction
We have been engaged by the Company to review the condensed set of Interim Financial Statements in the half-yearly
financial report for the six months ended 30 June 2015 (but not for the quarter ended 30 June 2015 as presented in the
Condensed Consolidated Statement of Comprehensive Income for the quarter ended 30 June 2015) which comprises Condensed
Consolidated Statement of Comprehensive Income, Condensed Consolidated Statement of Financial Position, Condensed
Consolidated Statement of Cash Flows, Condensed Consolidated Statement of Changes in Equity and Notes 1 to 6. We have read
the other information contained in the half-yearly financial report and considered whether it contains any apparent
misstatements or material inconsistencies with the information in the condensed set of financial statements.
This report is made solely to the Company in accordance with the terms of our engagement to assist the Company in meeting
the requirements of the Disclosure and Transparency Rules ("the DTR") of the UK's Financial Conduct Authority ('the UK
FCA"). Our review has been undertaken so that we might state to the Company those matters we are required to state to it in
this report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to
anyone other than the Company for our review work, for this report, or for the conclusions we have reached.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and has been approved by, the Directors. The Directors are
responsible for preparing the half-yearly financial report in accordance with the DTR of the UK FCA.
As disclosed in Note 1, the annual financial statements of the Group are prepared in accordance with International
Financial Reporting Standards ("IFRSs") as adopted by the European Union ("EU") and as issued by the International
Accounting Standards Board ("IASB"). The condensed set of financial statements included in this half-yearly financial
report has been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the EU and as issued by the
IASB.
Our responsibility
Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the
half-yearly financial report based on our review.
Scope of review
We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410 Review of
Interim Financial Information Performed by the Independent Auditor of the Entity issued by the Auditing Practices Board for
use in the UK. A review of interim financial information consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in
scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does
not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an
audit.
Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial
statements in the half-yearly financial report for the six months ended 30 June 2015 is not prepared, in all material
respects, in accordance with IAS 34 as adopted by the EU and as issued by the IASB, and the DTR of the UK FCA.
Antony Cates
for and on behalf of KPMG LLP
Chartered Accountants
15 Canada Square
London E14 5GL
30 July 2015
Notes to the Interim Financial Statements
1 BASIS OF PREPARATION AND ACCOUNTING POLICIES
These unaudited condensed consolidated interim financial statements ("interim financial statements") for the six months
ended 30 June 2015 have been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the European
Union (EU) and as issued by the International Accounting Standards Board (IASB).
The annual financial statements of the Group are prepared in accordance with International Financial Reporting Standards
(IFRSs) as adopted by the EU and as issued by the IASB. Except as detailed below, the interim financial statements have
been prepared applying the accounting policies and presentation that were applied in the preparation of the Group's
published consolidated financial statements for the year ended 31 December 2014.
Externalisation revenue
As announced on 6 March 2015, the Group updated its revenue accounting policy with effect from 1 January 2015. The Group's
business model now includes an increasing level of externalisation activity to create value from the strong science that
exists in the pipeline. Historically, reported revenue reflected only product sales, with externalisation revenue forming
part of other operating income presented below gross profit. From 1 January 2015 externalisation revenue, alongside product
sales, are included in total revenue. Externalisation revenue includes development, commercialisation, partnership and
out-licence revenue, such as royalties and milestone receipts, together with income from services or repeatable licences.
Income is recorded as externalisation revenue when the Group has a significant ongoing interest in the product and/or it is
repeatable business and there is no derecognition of an intangible asset. Disposals of assets and businesses, where the
Group does not retain an interest, will continue to be recorded in other operating income. The updated financial
presentation reflects the Group's entrepreneurial approach and provides a clearer picture of this additional revenue
stream. The updated revenue accounting policy results in a presentational change to the Statement of Comprehensive Income
only, and has no impact on the Group's net results or net assets. The prior period Condensed Consolidated Statement of
Comprehensive Income has been restated accordingly, resulting in $352m of income being reclassified from other operating
income to externalisation revenue for the half year ended 30 June 2014, and $308m for the quarter ended 30 June 2014.
New accounting standards
The Group has adopted the amendments to IAS 19 Employee Benefits, issued by IASB in November 2013 and effective for periods
beginning on or after 1 July 2014. The adoption has not had a significant impact on the Group's profit for the period, net
assets or cash flows. There have been no other significant new or revised accounting standards applied in the half year
ended 30 June 2015.
Legal proceedings
The information contained in Note 5 updates the disclosures concerning legal proceedings and contingent liabilities in the
Group's Annual Report and Form 20-F Information 2014.
Going concern
The Group has considerable financial resources available. As at 30 June 2015 the Group has $4.3bn in financial resources
(cash balances of $4.0bn and undrawn committed bank facilities of $3.0bn which are available until April 2020, with only
$2.7bn of debt due within one year). The Group's revenues are largely derived from sales of products which are covered by
patents which provide a relatively high level of resilience and predictability to cash inflows, although our revenue is
expected to continue to be significantly impacted by the expiry of patents over the medium term. In addition, government
price interventions in response to budgetary constraints are expected to continue to adversely affect revenues in many of
our mature markets. However, we anticipate new revenue streams from both recently launched medicines and products 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.
On the basis of the above paragraph and after making enquiries, the Directors have a reasonable expectation that the
Company and the Group have adequate resources to continue in operational existence for a period of at least 12 months.
Accordingly, the interim financial statements have been prepared on a going concern basis.
The comparative figures for the financial year ended 31 December 2014 are not the Company's statutory accounts for that
financial year. Those accounts have been reported on by the Group's auditors and delivered to the registrar of companies.
The report of the auditors 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.
2 restructuring costs
Profit before tax for the half year ended 30 June 2015 is stated after charging restructuring costs of $448m ($235m for the
second quarter of 2015). These have been charged to profit as follows:
HY 2015 HY 2014 Q2 2015 Q2 2014
$m $m $m $m
Cost of sales 101 24 58 13
Research and development expense 124 190 62 105
Selling, general and administrative costs 223 266 115 175
Other operating income and expense - 292 - -
Total 448 772 235 293
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.
At 1 Jan 2015 $m Cash Flow $m Non-cashMovements$m Exchange Movements$m At 30 Jun 2015 $m
Loans due after one year (8,337) - 19 62 (8,256)
Finance leases due after one year (60) - 12 1 (47)
Total long-term debt (8,397) - 31 63 (8,303)
Current instalments of loans (912) 884 - 28 -
Current instalments of finance leases (48) 34 (47) 1 (60)
Total current debt (960) 918 (47) 29 (60)
Other investments - current 795 (286) 28 (6) 531
Net derivative financial instruments 465 56 (5) - 516
Cash and cash equivalents 6,360 (2,363) - (30) 3,967
Overdrafts (196) (251) - 1 (446)
Short-term borrowings (1,290) (910) 1 - (2,199)
6,134 (3,754) 24 (35) 2,369
Net debt (3,223) (2,836) 8 57 (5,994)
Non-cash movements in the period include fair value adjustments under IAS 39.
4 FINANCIAL INSTRUMENTS
As detailed in the Group's most recent annual financial statements, our principal financial instruments consist of
derivative financial instruments, other investments, trade and other receivables, cash and cash equivalents, trade and
other payables, and interest-bearing loans and borrowings. As indicated in Note 1, there have been no changes to the
accounting policies, including fair value measurement, for financial instruments from those disclosed on pages 140 and 141
of the Company's Annual Report and Form 20-F Information 2014. In addition, there have been no changes of significance to
the categorisation or fair value hierarchy of our financial instruments. Financial instruments measured at fair value
include $979m of other investments, $1,176m of loans, and $516m of derivatives as at 30 June 2015. The total fair value of
interest-bearing loans and borrowings at 30 June 2015, which have a carrying value of $11,008m in the Condensed
Consolidated Statement of Financial Position, was $12,039m. Contingent consideration liabilities arising on business
combinations have been classified under Level 3 in the fair value hierarchy and movements in fair value are shown below:
DiabetesAlliance2015 Other 2015 Total 2015 Total 2014
$m $m $m $m
At 1 January 5,386 1,513 6,899 514
Additions through business combinations - - - 5,249*
Settlements (103) (136) (239) (449)
Revaluations - 82 82 6
Discount unwind 204 59 263 174
Foreign exchange - - - 6
At 30 June 5,487 1,518 7,005 5,500
*The preliminary estimate of the fair value of contingent consideration of $5,249m was subsequently revised, in the third
quarter of 2014, to $5,169m.
5 legal proceedings and contingent liabilities
AstraZeneca is involved in various legal proceedings considered typical to its business, including litigation and
investigations relating to product liability, commercial disputes, infringement of intellectual property rights, the
validity of certain patents, anti-trust law and sales and marketing practices. The matters discussed below constitute the
more significant developments since publication of the disclosures concerning legal proceedings in the Company's Annual
Report and Form 20-F Information 2014 (the 2014 Disclosures). Unless noted otherwise below or in the 2014 Disclosures, no
provisions have been established in respect of the claims discussed below.
As discussed in the 2014 Disclosures, for the majority of claims in which AstraZeneca is involved it is not possible to
make a reasonable estimate of the expected financial effect, if any, that will result from ultimate resolution of the
proceedings. In these cases, AstraZeneca discloses information with respect only to the nature and facts of the cases but
no provision is made.
In cases that have been settled or adjudicated, or where quantifiable fines and penalties have been assessed and which are
not subject to appeal, or where a loss is probable and we are able to make a reasonable estimate of the loss, we record the
loss absorbed or make a provision for our best estimate of the expected loss.
The position could change over time and the estimates that we have made and upon which we have relied in calculating these
provisions are inherently imprecise. There can, therefore, be no assurance that any losses that result from the outcome of
any legal proceedings will not exceed the amount of the provisions that have been booked in the accounts. The major factors
causing this uncertainty are described more fully in the 2014 Disclosures and herein.
AstraZeneca has full confidence in, and will vigorously defend and enforce, its intellectual property.
Matters disclosed in respect of the first quarter of 2015 and to 24 April 2015.
Patent litigation
Crestor (rosuvastatin)
Patent proceedings outside the US
As previously disclosed, in Australia, in 2011 and 2012, AstraZeneca instituted proceedings against Actavis Australia Pty
Ltd, Apotex Pty Ltd and Watson Pharma Pty Ltd asserting infringement of three formulation and method patents for Crestor.
In March 2013, the Federal Court of Australia held all three patents at issue invalid. AstraZeneca appealed in relation to
two patents. In August 2014, the Full Court of the Federal Court of Australia held the two patents invalid. In March 2015,
the High Court granted AstraZeneca leave to appeal in relation to one method patent.
Daliresp (roflumilast)
Patent proceedings in the US
In April 2015, AstraZeneca received several Paragraph IV Notices challenging certain patents listed in the FDA Orange Book
with reference to Daliresp. AstraZeneca is reviewing the Notices.
Faslodex (fulvestrant)
Patent proceedings outside the US
In March 2015, AstraZeneca was served with a writ of summons by which Actavis Group PTC ehf. and Actavis Italy S.p.A
(together, Actavis) commenced invalidity and non-infringement proceedings before a court in Turin, Italy relating to two
Faslodex formulation patents, European Patent EP 1250138 and Italian Patent IT 1333490.
Losec/Prilosec (omeprazole)
Patent proceedings in the US
As previously disclosed, in 2008, Apotex Inc. (Apotex) was found to infringe AstraZeneca's US Patent Nos. 4,786,505 and
4,853,230. In 2013, the US District Court for the Southern District of New York ordered Apotex to pay $76m in damages with
an additional sum of $28m in pre-judgment interest, and an unspecified amount of post-judgment interest. Apotex appealed.
In April 2015, the US Court of Appeals for the Federal Circuit affirmed the bulk of the damages award, with the exception
of a small portion of the award which related to sales post patent expiration during a portion of the paediatric
exclusivity period.
Patent proceedings outside the US
As previously disclosed, in Canada, in 2004, AstraZeneca brought proceedings against Apotex Inc. (Apotex) for infringement
of several patents related to Losec. In February 2015, the Federal Court of Canada found that Apotex had infringed
AstraZeneca's Canadian Patent No. 1,292,693. Apotex have appealed.
Pulmicort Respules (budesonide inhalation suspension)
Patent proceedings in the US
As previously disclosed, in October 2014, the US District Court for the District of New Jersey (the District Court) held a
trial on the merits in respect of US Patent No. 7,524,834 (the '834 Patent) and to determine whether AstraZeneca's request
for permanent injunctive relief against Breath Limited, Apotex, Inc. and Apotex Corp., Sandoz, Inc. and Watson
Laboratories, Inc. (together, the Generic Challengers) should be granted. On 13 February 2015, the District Court
determined that the '834 Patent is invalid and denied the injunction request. Also on 13 February 2015, AstraZeneca filed a
motion for an injunction pending an appeal of the District Court's decision, which was denied on the same day. On 16
February 2015, AstraZeneca appealed the District Court's decision to the US Court of Appeals for the Federal Circuit (the
Court of Appeals) and filed an Emergency Motion for an Injunction Pending Appeal. On 17 February 2015, the Court of Appeals
issued an injunction against the Generic Challengers pending submissions by the parties. On 12 March 2015, the Court of
Appeals issued an injunction pending appeal. Oral argument in the appeal is scheduled for 4 May 2015.
Seroquel XR (quetiapine fumarate)
Patent proceedings in the US
As previously disclosed, in October and November 2014, AstraZeneca filed patent infringement proceedings against Pharmadax,
Inc. and Pharmadax USA, Inc. (together, Pharmadax) in the US District Court for the District of New Jersey. In February
2015, AstraZeneca settled the patent infringement litigation by granting Pharmadax a licence to the Seroquel XR product
patent effective from 1 November 2016, or earlier in certain circumstances.
In February 2015, AstraZeneca received a Paragraph IV Notice from AB Pharmaceuticals, LLC, the US agent of Macleods
Pharmaceuticals, Ltd., (together, Macleods) alleging that the patent listed in the FDA Orange Book with reference to
Seroquel XR is invalid, unenforceable and/or is not infringed by Macleods' proposed generic product. Macleods submitted an
Abbreviated New Drug Application (ANDA) seeking to market quetiapine fumarate tablets. In February 2015, AstraZeneca filed
a patent infringement lawsuit against Macleods and Macleods Pharma USA, Inc. in the US District Court for the District of
New Jersey.
Patent proceedings outside the US
As previously reported, in March 2013, the Federal Court of Canada dismissed AstraZeneca's application to prohibit the
Canadian Minister of Health from issuing a notice of compliance to Teva Canada Limited (Teva) for its generic quetiapine
fumarate product relating to Seroquel XR. Teva subsequently launched its generic Seroquel XR at risk and filed an action
seeking section 8 damages arising from these proceedings. In April 2015, AstraZeneca and Teva entered into a settlement
agreement ending the ongoing patent litigation between the parties, as well as the section 8 damages action, and allowing
Teva to continue selling generic Seroquel XR.
Vimovo(esomeprazole magnesium/naproxen)
Patent proceedings outside the US
In Canada, in January 2015, AstraZeneca received two Notices of Allegation from Mylan Pharmaceuticals ULC. In response,
AstraZeneca and Pozen Inc. (the licensee and patent holder, respectively), commenced proceedings in relation to Canadian
Patent No. 2,449,098.
Commercial litigation
Seroquel IR (quetiapine fumarate)
As previously disclosed, with regard to insurance coverage for the substantial legal defence costs and settlements that
have been incurred in connection with the Seroquel IR product liability claims in the US, related to alleged diabetes
and/or other related alleged injuries (which now exceed the total amount of insurance coverage available), an arbitration
is ongoing against an insurer in respect of the availability of coverage under an insurance policy. The policy has a
coverage limit of $50m. AstraZeneca has not recognised an insurance receivable in respect of this legal action.
Synagis (palivizumab)
As previously disclosed, in September 2011, MedImmune filed an action against AbbVie, Inc. (AbbVie) (formerly Abbott
International, LLC) in the Circuit Court for Montgomery County, Maryland, seeking a declaratory judgment in a contract
dispute. AbbVie's motion to dismiss was granted. In September 2011, AbbVie filed a parallel action against MedImmune in the
Illinois State Court, where the case is currently pending. A trial date has been set for 31 August 2015.
Toprol-XL (metoprolol succinate)
On 30 March 2015, AstraZeneca was served with a state court complaint filed by the Attorney General for the State of
Louisiana alleging that, in connection with enforcement of its patents for Toprol-XL, it had engaged in unlawful
monopolisation and unfair trade practices, causing the state government to pay increased prices for Toprol-XL. The
complaint is very similar to prior class action complaints filed by private parties against AstraZeneca relating to
Toprol-XL in 2006 and resolved by settlement in 2012. The State seeks an unspecified amount of trebled damages and
pre-judgment interest. AstraZeneca denies these allegations.
Matters disclosed in respect of the second quarter of 2015 and to 30 July 2015.
Patent litigation
Crestor (rosuvastatin)
Patent proceedings outside the US
As previously disclosed, in 2014, in Japan, Shionogi & Co., Ltd. the licensor of the Crestor patent, received confirmation
of a request for trial for patent invalidation in the Japanese Patent Office (JPO). The request was initiated by Teva
Pharma Japan Inc. (Teva) and relates to the Crestor substance patent. On 29 June 2015, the JPO dismissed Teva's claim. A
second invalidation action relating to the same patent has been filed by an individual.
As previously disclosed, in 2014, in the Netherlands, AstraZeneca received a letter from Resolution Chemicals Ltd.
(Resolution) indicating that it had sought marketing authorisation for a rosuvastatin zinc product in the Netherlands. In
April 2014, AstraZeneca received a writ of summons from Resolution alleging partial invalidity and non-infringement of the
supplementary protection certificate (SPC) related to the Crestor substance patent. On 15 July 2015, the District Court of
the Hague determined that the SPC does not extend to zinc salts of rosuvastatin and that Resolution's product does not
infringe the SPC. AstraZeneca is considering its response.
Daliresp (roflumilast)
Patent proceedings in the US
As previously disclosed, in April 2015, AstraZeneca received Paragraph IV Notices challenging certain patents listed in the
FDA Orange Book with reference to Daliresp. AstraZeneca has received notice from ten companies that each has submitted an
Abbreviated New Drug Application (ANDA) seeking to market roflumilast. In May 2015, AstraZeneca filed a patent infringement
lawsuit against each of the ten companies in the US District Court for the District of New Jersey.
Faslodex (fulvestrant)
Patent proceedings in the US
As previously disclosed, in June and September 2014 and January 2015, AstraZeneca filed patent infringement lawsuits
against Sandoz Inc. and Sandoz International GmbH, Sagent Pharmaceuticals, Inc., and Glenmark Generics, Inc. USA in the US
District Court in New Jersey relating to four patents listed in the FDA Orange Book with reference to Faslodex, after those
companies sent Paragraph IV notices that they are seeking FDA approval to market generic versions of Faslodex prior to the
expiration of AstraZeneca's patents. In July 2015, AstraZeneca received a Paragraph IV notice from Agila Specialties Inc.,
on behalf of Onco Therapies Limited, which is also seeking FDA approval to market a generic version of Faslodex prior to
the expiration of the same four patents.
Patent proceedings outside the US
In July 2015, AstraZeneca was served with two nullity complaints, one filed by Hexal AG and the other by ratiopharm GmbH,
commencing invalidity proceedings before the Federal Patent Court in Germany, and requesting the revocation of the German
part of the Faslodex formulation use patent, EP 1,250,138.
Losec/Prilosec (omeprazole)
Patent proceedings in the US
As previously disclosed, in 2008, Apotex Inc. (Apotex) was found to infringe AstraZeneca's US Patent Nos. 4,786,505 and
4,853,230 and in 2013, the US District Court for the Southern District of New York (the District Court) ordered Apotex to
pay $76m in damages with an additional sum of $28m in pre-judgment interest, and an unspecified amount of post-judgment
interest. Apotex appealed. In April 2015, the US Court of Appeals for the Federal Circuit affirmed the bulk of the damages
award, with the exception of a small portion of the award which related to sales post patent expiration during a portion of
the paediatric exclusivity period. In July 2015, the District Court ordered Apotex to pay $99m to AstraZeneca. The
proceeding is now closed and AstraZeneca has recognised the settlement income.
Nexium(esomeprazole)
Patent proceedings in the US
In June 2015, AstraZeneca received a Paragraph IV Notice from HEC Pharm Co., Ltd (HEC) challenging certain patents listed
in the FDA Orange Book with reference to Nexium. HEC submitted an Abbreviated New Drug Application (ANDA) seeking to market
esomeprazole magnesium capsules. AstraZeneca is reviewing HEC's notice.
In June 2015, AstraZeneca received a Paragraph IV Notice from Lupin Ltd (Lupin) challenging certain patents listed in the
FDA Orange Book with reference to Nexium 24HR (OTC). Lupin submitted an ANDA seeking to market OTC esomeprazole magnesium
capsules. AstraZeneca is reviewing Lupin's notice.
As previously disclosed, in March 2012, AstraZeneca filed a patent infringement lawsuit against Mylan Laboratories Limited
and Mylan Inc. (together, Mylan) in the US District Court for the District of New Jersey. In July 2015, AstraZeneca filed a
motion for preliminary injunction against Mylan's launch of its ANDA version of esomeprazole magnesium capsules. The
patents-at-issue are US Patent Nos. 6,369,085 and 7,411,070. Both patents have a date of expiry of 25 May 2018.
Patent proceedings outside the US
As previously disclosed, in July 2014, in Canada, the Federal Court found Canadian Patent No. 2,139,653 invalid and not
infringed by Apotex Inc. On 6 July 2015, AstraZeneca's appeal was dismissed.
As previously disclosed, in July 2014, in Canada, AstraZeneca received a Notice of Allegation from Teva Canada Limited
(Teva) alleging either that Teva's esomeprazole magnesium product would not infringe the patents listed on the Canadian
Patent Register in relation to Nexium or, alternatively, that certain of the patents were invalid. AstraZeneca commenced a
proceeding in 2014, but has now discontinued its application pursuant to a settlement agreement.
Onglyza (saxagliptin) and Kombiglyze XR (saxagliptin and metformin)
Patent proceedings in the US
In June 2015, Mylan Pharmaceuticals, Inc. filed a petition for an Inter Parties Review with the US Patent Office
challenging the validity of the saxagliptin compound patent, US RE44,186, that is listed in the FDA Orange Book for both
Onglyza and Kombiglyze XR.
Pulmicort Respules (budesonide inhalation suspension)
Patent proceedings in the US
As previously disclosed, in February 2015, the US District Court for the District of New Jersey (the District Court)
determined that the asserted claims of US Patent No. 7,524,834 was invalid. AstraZeneca appealed that decision and on 7 May
2015, the US Court of Appeals for the Federal Circuit affirmed the District Court's decision and lifted the injunction that
was issued pending the appeal. Since 2009, various injunctions were issued in this matter. Damages claims based on those
injunctions are expected and a provision has been taken in the first half of 2015.
Seroquel XR (quetiapine fumarate)
Patent proceedings in the US
As previously disclosed, in February 2015, AstraZeneca filed a patent infringement lawsuit against Macleods
Pharmaceuticals, Ltd. Macleods Pharma USA, Inc. and AB Pharmaceuticals, LLC. (together, Macleods) in the US District Court
for the District of New Jersey. In June 2015, AstraZeneca settled the patent infringement litigation by granting Macleods a
license to the Seroquel XR product patent effective from 1 November 2016, or earlier in certain circumstances.
Patent proceedings outside the US
In Italy, in June 2015, following a challenge to the validity of the formulation patent covering Seroquel XR by Sandoz
S.p.A. and Sandoz A/S, the Court of Turin found the Seroquel XR formulation patent invalid.
Product liability litigation
Nexium (esomeprazole magnesium)
As previously disclosed, of the approximately 1,900 plaintiffs who alleged that Nexium caused osteoporotic injuries, such
as bone deterioration, loss of bone density and/or bone fractures, approximately 40 claims remained active in California
state court and the rest of the claims were dismissed. In June 2015, the California state court granted AstraZeneca's
motion for summary judgment and dismissed the approximately 40 remaining plaintiffs' claims. In addition, as previously
disclosed, approximately 270 plaintiffs have appealed the dismissals of their claims and those appeals remain pending.
Commercial litigation
Average Manufacturer's Price qui tam litigation (Streck)
AstraZeneca was one of several manufacturers named as a defendant in a lawsuit filed in the US Federal Court in
Philadelphia under the qui tam (whistleblower) provisions of the federal and certain state False Claims Acts alleging
inaccurate reporting of Average Manufacturer's prices to the Centers for Medicare and Medicaid Services. The action was
initially filed in October 2008 but remained under seal until May 2011. In July 2015, AstraZeneca agreed upon a negotiated
settlement to resolve the dispute. A provision for this amount was previously taken.
6. product Sales analysis - h1 2015
World US Europe Established ROW Emerging Markets
H1 2015$m CER% H1 2015$m CER H1 2015$m CER% H1 2015$m CER% H1 2015$m CER%
%
Respiratory, Inflammation and Autoimmunity:
Symbicort 1,687 - 717 (1) 582 (8) 201 9 187 28
Pulmicort 518 18 108 4 66 (7) 41 (2) 303 37
Tudorza/Eklira 85 n/m 45 n/m 36 n/m 4 n/m - -
Duaklir 7 n/m - n/m 6 n/m 1 n/m - -
Others 171 20 49 188 46 (7) 10 - 66 4
Total Respiratory, Inflammation and Autoimmunity 2,468 9 919 9 736 (3) 257 9 556 30
Cardiovascular and Metabolic disease:
Brilinta/Brilique 275 42 101 60 110 21 17 36 47 80
Onglyza 391 4 211 (16) 71 23 32 30 77 56
Bydureon 263 41 222 35 35 71 3 33 3 200
Byetta 172 8 121 15 30 (13) 10 - 11 33
Farxiga/Forxiga 205 n/m 115 n/m 53 n/m 11 44 26 n/m
Legacy:
Crestor 2,477 (5) 1,374 (7) 469 (7) 282 (3) 352 5
Seloken/Toprol-XL 378 7 48 (9) 49 (3) 7 (20) 274 14
Atacand 194 (11) 18 (10) 53 (33) 15 (23) 108 8
Others 327 (4) 35 (5) 75 (13) 30 (21) 187 6
Total Cardiovascular and Metabolic Disease 4,682 4 2,245 2 945 - 407 (2) 1,085 16
Oncology:
Iressa 273 (3) - - 66 (5) 68 (11) 139 3
Lynparza 30 n/m 26 n/m 4 n/m - n/m - n/m
Legacy:
Zoladex 409 9 14 27 85 (15) 133 (2) 177 32
Faslodex 333 5 165 2 101 1 25 4 42 32
Casodex 139 (5) 1 (67) 15 (18) 66 (14) 57 17
Arimidex 126 (9) 7 (22) 25 (27) 40 (15) 54 14
Others 71 23 13 - 15 13 29 79 14 (11)
Total Oncology 1,381 5 226 15 311 (7) 361 (4) 483 18
Infection, Neuroscience and Gastrointestinal:
Nexium 1,291 (27) 479 (49) 143 (10) 272 (6) 397 (1)
Seroquel XR 526 (7) 353 2 113 (25) 14 (30) 46 10
Synagis 270 (28) 160 (38) 110 (6) - - - n/m
Losec/Prilosec 181 (6) 12 (7) 48 (12) 39 (17) 82 6
FluMist/Fluenz 21 75 21 110 - - - n/m - -
Movantik/Moventig 4 n/m 4 n/m - n/m - n/m - n/m
Others 760 (8) 106 (28) 195 (13) 141 1 318 (1)
Total Infection, Neuroscience and Gastrointestinal 3,053 (18) 1,135 (34) 609 (14) 466 (7) 843 -
TOTAL PRODUCT SALES 11,584 (2) 4,525 (9) 2,601 (5) 1,491 (2) 2,967 14
7. product Sales analysis - Q2 2015
World US Europe Established ROW Emerging Markets
Q2 2015$m CER% Q2 2015$m CER Q2 2015$m CER% Q2 2015$m CER% Q2 2015$m CER%
%
Respiratory, Inflammation and Autoimmunity:
Symbicort 842 - 375 (1) 276 (9) 102 24 89 16
Pulmicort 232 19 56 8 28 (15) 21 5 127 44
Tudorza/Eklira 55 n/m 35 n/m 18 n/m 2 n/m - n/m
Duaklir 5 n/m - - 4 n/m 1 n/m - -
Others 91 32 37 n/m 21 (16) 7 60 26 (18)
Total Respiratory, Inflammation and Autoimmunity 1,225 11 503 16 347 (3) 133 23 242 20
Cardiovascular and Metabolic disease:
Brilinta/Brilique 144 38 55 57 56 21 9 38 24 59
Onglyza 208 (7) 113 (22) 34 (5) 18 25 43 38
Bydureon 140 29 116 22 19 53 2 50 3 -
Byetta 82 (1) 53 - 15 (22) 6 14 8 60
Farxiga/Forxiga 129 n/m 78 n/m 29 n/m 8 n/m 14 n/m
Legacy:
Crestor 1,310 (3) 760 (1) 226 (9) 150 (4) 174 (1)
Seloken/Toprol-XL 184 6 21 (28) 24 (3) 4 - 135 16
Atacand 99 (13) 7 (22) 23 (38) 8 (9) 61 4
Others 156 (4) 15 (25) 36 (13) 15 (26) 90 12
Total Cardiovascular and Metabolic Disease 2,452 4 1,218 3 462 (3) 220 (1) 552 14
Oncology:
Iressa 129 (1) - - 31 (5) 36 10 62 (4)
Lynparza 21 n/m 18 n/m 3 n/m - n/m - n/m
Legacy:
Zoladex 215 14 8 60 41 (17) 71 2 95 41
Faslodex 172 9 82 (4) 52 10 13 15 25 50
Casodex 69 (5) 1 (50) 7 (18) 34 (13) 27 20
Arimidex 64 (6) 4 - 12 (25) 21 (7) 27 8
Others 37 20 7 - 7 13 16 90 7 (30)
Total Oncology 707 9 120 17 153 (4) 191 4 243 20
Infection, Neuroscience and Gastrointestinal:
Nexium 647 (27) 254 (44) 69 (14) 144 (9) 180 (16)
Seroquel XR 264 (8) 184 2 50 (30) 7 (18) 23 4
Synagis 66 40 (2) n/m 68 51 - - - n/m
Losec/Prilosec 85 (9) 5 (17) 22 (15) 20 (14) 38 3
FluMist/Fluenz 14 180 14 180 - - - - - -
Movantik/Moventig 1 n/m 1 n/m - - - - - -
Others 375 (11) 59 (19) 90 (18) 70 (13) 156 (2)
Total Infection, Neuroscience and Gastrointestinal 1,452 (17) 515 (28) 299 (12) 241 (10) 397 (8)
TOTAL PRODUCT SALES 5,836 (1) 2,356 (3) 1,261 (5) 785 - 1,434 9
ASTRAZENECA DEVELOPMENT PIPELINE 30 JUNE 2015
Phase III / Pivotal Phase II / Registration
NMEs and significant additional indications
Submission dates shown for assets in Phase III and beyond. As disclosure of compound information is balanced by the
business need to maintain confidentiality, information in relation to some compounds listed here has not been disclosed at
this time.
† US and EU dates correspond to anticipated acceptance of the regulatory filing.
# Partnered product.
Respiratory, Inflammation and Autoimmunity
anifrolumab# IFN-alphaR mAb SLE Q3 20151 2019 2019 2019
benralizumab#CALIMA SIROCCO ZONDA BISE BORAGREGALE IL-5R mAb severe asthma Q4 2013 H2 2016 H2 2016 N/A N/A
benralizumab#TERRANOVA GALATHEA IL-5R mAb COPD Q3 2014 2018 2018 N/A N/A
brodalumabAMAGINE-1,2,3 IL-17R mAb psoriasis Q3 2012 2015++ 2015++
brodalumab AMVISION-1,2 IL-17R mAb psoriatic arthritis Q1 2014 ++ ++
lesinurad selective uric acid reabsorption inhibitor (URAT-1) chronic treatment of patients with gout Q4 2011 Filed Filed
CLEAR 1,2
CRYSTAL
PT003 GFF PINACLE LABA / LAMA COPD Q2 2013 Q3 2015 H1 2016 2017 2017
PT010 LABA / LAMA / ICS COPD Q3 20151 2018 2018 2018 2019
tralokinumabSTRATOS 1,2TROPOS IL-13 mAb severe asthma Q3 2014 2018 2018 2018
Cardiovascular and Metabolic Disease
Brilinta/Brilique2 P2Y12 receptor antagonist arterial thrombosis Launched Launched Filed Launched
Epanova# omega-3 carboxylic acids severe hypertriglyceridaemia Approved 2017 2019
Farxiga/Forxiga3 SGLT-2 inhibitor type-2 diabetes Launched Launched Launched Filed
roxadustat# OLYMPUS ROCKIES hypoxia-inducible factor prolyl hydroxylase inhibitor anaemia in CKD/ESRD Q3 2014 2018 N/A N/A H2 2016
Oncology
AZD9291AURA 2,3 EGFR tyrosine kinase inhibitor ≥2nd-line advanced EGFRm T790M NSCLC Q2 2014 Filed 4(Breakthrough designation) Filed Q3 2015 2017
AZD9291FLAURA EGFR tyrosine kinase inhibitor 1st-line advanced EGFRm NSCLC Q1 2015 2017 2017 2017 2020
Caprelsa VEGFR / EGFR tyrosine kinase inhibitor with RET kinase activity medullary thyroid cancer Launched Launched Filed Filed
cediranibICON 6 VEGFR tyrosine kinase inhibitor PSR ovarian cancer Q2 2007 Filed5(Orphan Drug)
durvalumab (MEDI4736)#PACIFIC PD-L1 mAb stage III NSCLC Q2 2014 2017 2020 2020
durvalumab (MEDI4736)# PD-L1 mAb 3rd-line NSCLC Q1 2014 H1 2016(Fast Track) 2017 2017
ATLANTIC¶
durvalumab (MEDI4736)# +tremelimumab PD-L1 mAb + CTLA-4 mAb 3rd-line NSCLC Q2 2015 2017
- More to follow, for following part double click ID:nRSd5111UdRecent news on AstraZeneca
See all newsRCS - LHH - LHH, EZRA's AI Leadership Transformation Program
AnnouncementREG - AstraZeneca PLC - Baxdrostat met primary endpoint in Bax24 Ph3 trial
AnnouncementREG - AstraZeneca PLC - Datroway improved OS and PFS in TROPION-Breast02
AnnouncementREG - AstraZeneca PLC - Total Voting Rights
AnnouncementREG - AstraZeneca PLC - Enhertu improved IDFS in early BC in DB-05
Announcement