When the novel coronavirus was first identified in China and put the entire country on high alert, there were concerns that the outbreak would hit AstraZeneca hard, given its high exposure to the emerging market. But the company’s sales figures have shown resilience.
In the first quarter, AstraZeneca grew sales by 17% at constant currencies to $6.31 billion, 7% ahead of industry watchers’ expectations. Even after stripping out a low- to mid-single-digit percentage boost from pandemic-related stockpiling of medicines, the British pharma still topped estimates.
Growth from China during the three months did slow down to 17% from 35% in 2019, but its sales of $1.41 billion as relative to AZ’s entire business held steady at 22%.
China’s economy is already restarting as the virus has been largely contained, and hospitals there are opening to patients outside of COVID-19, AZ’s biopharmaceuticals business head Ruud Dobber noted during a Wednesday call with reporters.
“It doesn’t mean that it’s back to normal levels, but based on all the actions of the Chinese government, we clearly see an uptick in patient demand,” he added. One could argue that a high reliance on China may now serve AZ well against many of its peers, given other parts of the world remain on lockdown.
Oncology revenue in emerging markets jumped 49% at constant currencies to $711 million. AZ resorted to a digital launch of PD-L1 inhibitor Imfinzi in China after securing a go-ahead in stage 3 non-small cell lung cancer (NSCLC) there in December.
“The fact that we saw China able to have a successful launch with [data from the Pacific trial], despite the challenges around being able to see physicians face to face … and having a lot of online education take place, speaks also to the work that’s been happening over the many months that preceded just in general to ensure that our digital capabilities were at the level that they needed to be in order to support this kind of shift and execution,” AZ’s oncology business chief Dave Fredrickson said during the call.
During the quarter, sales of AZ’s oncology portfolio increased by 33%. Fredrickson attributed the strong performance to a balance of oral meds versus infused therapies, the latter of which are experiencing more uptake obstacles during the pandemic.
Key cancer drugs all did well. Oral EGFR inhibitor Tagrisso generated sales of $982 million, 12% ahead of consensus. The company recently hit goals of a phase 3 trial of Tagrisso in postsurgery NSCLC patients about two years ahead of schedule, potentially opening up a multibillion-dollar market opportunity. PARP inhibitor Lynparza’s $397 million and Imfinzi’s $462 million both came in above analysts’ estimates, too.
Fredrickson said Imfinzi, despite being an infused drug, has had greater resilience in the U.S. mainly because “stage 3 [NSCLC] is curative-intent setting, so there’s a huge imperative to ensure patients are treated.”
Respiratory represents another major sector at AstraZeneca. In fact, older inhaler Symbicort was the main driving force behind AZ’s first-quarter sales beat, Jefferies analyst Peter Welford wrote in a note to clients Wednesday. Thanks to COVID-19-related inventory build, especially now that there’s an authorized generic, the drug posted sales of $790 million, up 35% over the same period last year and beating consensus by a whopping 38%.
Better patient compliance played a part. Healthcare guidelines have been asking chronic obstructive pulmonary disease and asthma patients to stay on therapy during the pandemic, because ending up in the hospital could be more dangerous for these lung disease patients, Dobber explained. “As a result of that, we see stockpiling across the whole channel,” he said. “We’re expecting that over the course of 2020 this will further unwind.”
Like several other pharma companies already have, AZ confirmed its full-year guidance. Revenues will increase by a high-single-digit to a low-double-digit percentage, if the pandemic lasts for a few more months and business reopening continues on its current trend, the company said.