AstraZeneca's having second thoughts about its COVID vaccine business as FDA filing drags on

Pascal Soriot
AstraZeneca CEO Pascal Soriot defended the company's COVID-19 vaccine as the shot's sales swelled to $894 million in the second quarter. (AstraZeneca)

AstraZeneca’s COVID-19 vaccine has faced controversies ranging from clinical data clarity to harmful side effects. Now, as the shot takes even longer to reach the U.S., the drugmaker is having second thoughts about the business.

AstraZeneca is “exploring different options” for the COVID vaccine it licensed from the University of Oxford, Ruud Dobber, AZ’s chief of the biopharmaceuticals business unit, told Reuters. The company will “have more clarity” by the end of the year, he added.

“Is the vaccine businesses a sustainable business for AstraZeneca for the next five or 10 years, that big strategic question is under discussion,” Dobber said, as quoted by Reuters.

AstraZeneca’s strategic evaluation comes as a U.S. filing of the vaccine takes longer than expected and as the vaccine hurts AZ’s overall profit.

The drugmaker now expects to submit its FDA application by the end of this year. Back in April, the company was looking at a timeline of “in the coming weeks.” The British pharma is skipping the emergency use authorization process and has been eying a full U.S. approval. 

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As AstraZeneca CEO Pascal Soriot pointed out on a call Thursday, the application package for a full approval is much larger than an EUA dossier. It’s typical for a drugmaker to take six or seven years to prepare for an FDA filing after wrapping up phase 3 testing, he noted.

AZ licensed its COVID-19 shot from Oxford last May. Without prior experience in human vaccines, the company has found itself embroiled in several controversies since then, including a dosing mix-up in a key efficacy trial, a data miscommunication that drew censure from the National Institutes of Health, a legal tussle with the EU, plus concerns over the shot’s rare side effects. But to hear Soriot tell it, despite all the challenges, the shot is still playing an important role in the pandemic.

Sales from the AZ COVID-19 vaccine, sold in the EU under the brand name Vaxzevria, swelled to $894 million in the second quarter, bringing its total haul in the first half of 2021 to $1.17 billion.

AZ and its manufacturing partners have shipped 1 billion doses of the vaccine to different parts of the world, with current monthly supply tracking at around 200 million doses, Soriot said Thursday.

Still, the vaccine’s sales number is no match to the $7.8 billion Pfizer recorded for its BioNTech-shared vaccine, Comirnaty, in the second quarter.

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One reason AZ’s shot has been slow to gain uptake in Western countries? Relatively weaker efficacy in reducing symptomatic COVID compared with Pfizer/BioNTech’s and Moderna’s mRNA vaccines.

A study by Public Health England and published in The New England Journal of Medicine found Vaxzevria was 67% effective against symptomatic disease caused by the concerning delta variant first identified in India, while the Pfizer/BioNTech shot’s efficacy was 88%.

But during Thursday’s call, Soriot defended Vaxzevria by taking a step back and pointing to its ability to reduce hospitalization.

“The key is to control hospitalizations and of course death and severe disease,” Soriot said. “Not so much in the end to count infections. We have to accept the fact that people will be infected.”

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But as the U.S. has mainly leaned on Comirnaty, Moderna’s Spikevax and Johnson & Johnson’s one-dose shot, the country currently doesn’t need much additional help from AZ.

“We believe it could play a role in the future,” Soriot said of the vaccine’s U.S. filing. “It’s a good vaccine, and we just want to make sure that it’s ready to be used if needed.”

One way the vaccine could play a part is through a potential booster program. AZ in June launched a phase 2/3 trial for a COVID-19 variant vaccine in either vaccinated people or COVID vaccine-naïve people. The first data from that trial are expected later this year.

While the U.S. remains mostly inaccessible for AZ, Soriot touted Vaxzevria’s contribution to developing countries. Of the 514 million doses of COVID shots major Western companies have supplied to low- and lower-middle-income countries, AZ supplied 477 million, Soriot said.

AZ has promised not to make a profit out of its COVID vaccine during the pandemic, but the vaccine is currently hurting the company’s bottom line. During the second quarter, the company said the vaccine hurt its per-share profit by $0.01.

Overall, AZ’s total revenue in the second quarter reached $8.22 billion, up 25% year over year at constant currencies. Excluding the COVID vaccine, the haul was $7.33 billion, or 12% growth at unchanged exchange rates.