Thursday, 31 October 2013
Pascal Soriot, Chief Executive Officer, commenting on the results, said:
"We continue to focus on the strategic priorities of returning to growth and achieving scientific leadership, and this is reflected in continued investment in our growth platforms and our pipeline. I am pleased with the progress we are making, particularly on the pipeline, with three regulatory filings, three Phase III starts and four business development transactions since our last update. As expected, our financial performance this year reflects the ongoing impact from the loss of exclusivity for several key brands."
As expected, third quarter revenue declined due to the ongoing impact from products with recent losses of exclusivity. The 4 percent decline in revenue on a constant currency basis, combined with continued investment in our growth platforms and scientific leadership resulted in a greater decline in Core earnings per share. The late-stage pipeline continued to grow; since the half year update there have been three new Phase III programme starts and three regulatory filings were accepted for review.
Revenue in the third quarter was $6,250 million, down 4 percent at constant exchange rates (CER).
- Loss of exclusivity on several brands accounted for around $350 million in CER revenue decline in the quarter.
- Five growth platforms (Emerging Markets, Japan, Brilinta, diabetes franchise and respiratory franchise) achieved an 8 percent revenue increase at CER in the quarter.
Core operating profit in the third quarter was down 29 percent at CER to $2,027 million.
- The $250 million gain within Core other income from the sale of OTC rights for Nexium in the third quarter last year accounted for 9 percentage points of the decline in the quarter. The balance of the decline was largely driven by lower revenue combined with an increase in Core operating costs.
Core EPS was $1.21 in the third quarter, a 26 percent decline at CER.
Reported EPS in the third quarter was down 16 percent at CER to $0.99.
- Reported EPS in the third quarter this year includes $0.18 per share benefit from the reversal of an intangible asset impairment related to the initiation of Phase III clinical trials for olaparib.
Late stage pipeline strengthened by three new Phase III clinical programme starts: olaparib, selumetinib and benralizumab. Regulatory filings were accepted for review for olaparib and naloxegol in Europe and for Epanova in the US.
New collaborations with Merck (WEE1 kinase inhibitor) and Janssen (co-promotion of abiraterone acetate in Japan) and acquisitions of Amplimmune and Spirogen strengthen our oncology portfolio.