AstraZeneca posted strong third-quarter numbers and boosted its full-year forecast by a whopping 40 cents per share. But one of the biggest pieces of news to come out of the company's Q3 report is a $520 million tentative agreement with the U.S. Attorney's Office in Philadelphia. Like several other drugmakers who've announced big settlements this year, AstraZeneca was facing a probe into alleged off-label marketing of a drug. In this case, the antipsychotic Seroquel.
AstraZeneca says it has agreed in principle to pay $520 million to end the probes, with negotiations ongoing to finalize the civil settlements and a corporate integrity agreement. Company executives declined to provide more details about the investigation, beyond the fact that off-label Seroquel marketing allegations were part of it.
Now, $520 million pales next to Eli Lilly's $1.4 billion settlement related to mismarketing of Zyprexa, one of Seroquel's direct rivals in the antipsychotic realm. And it really seems to shrink compared with Pfizer's record-setting $2.3 billion settlement of claims that it mismarketed a handful of meds, including the now-withdrawn painkiller Bextra. Still, the AZ deal involves a big chunk of change, and the company had to increase its legal set-aside to $538 million.
In other Q3 news, pandemic flu was kind to the drugmaker, helping to propel profits upward by 22 percent to $2.12 billion. Plus, the company anticipates the kindness to continue, so it raised its full-year earnings forecast to a maximum of $6.40 from its previous top of $6. And during a quarter when some other Big Pharmas posted profits growth despite sales stagnation, AZ revenues grew by 5.5 percent, helped by strong Crestor sales and forestalled generic competition.