AstraZeneca posts 29% rise in 1st-qtr 2010 profits, but warns of tougher times as key patents expire

Anglo-Swedish drug major AstraZeneca reported that first-quarter profit rose 29 % to $2.9 billion, and revenues were up 11% (+7% at constant exchange rates), reaching $8.58 billion for the three months, with the numbers beating expectations. The mean consensus forecasts had been for earnings of $1.69 and sales of $8.15 billion, according to Thomson Reuters I/B/E/S. However, the company warned that comparisons will be tougher in the second half of the year when, among other things, there will be key patent expiries.

Core earnings per share rose 23% at CER to $2.03, benefitting by $0.13 from net adjustments to tax provisions as a consequence of the previously disclosed settlement with UK Tax Authorities and developments in other transfer pricing matters. Reported EPS increased by 23% at CER to $1.91, and the company raises it core target for the full year to the range of $6.05 to $6.35.  Release of the figures yesterday saw AstraZeneca's shares rise 3.5% to £29.37 on the London Stock Exchange.

Chief executive David Brennan commented: 'The first quarter results reflect continued strong market performance for key brands like Crestor [rosuvastatin], Seroquel [quetiapine] and Symbicort [budesonide and formoterol]. We saw revenue growth in all major regions, including another strong quarter in emerging markets [where sales rose 19% to $1.26 billon]. Looking forward, revenue comparisons will become more challenging in the second half of the year as a result of the uplift from Toprol-XL [metoprolol] and H1N1 vaccine sales in 2009 and the expiration of the Arimidex [anastrozole] patent later this year. Based on the first quarter performance and the outlook for the remainder of the year we have increased our Core EPS target. Our pipeline has been further strengthened during the quarter by the addition of a new late-stage development project in rheumatoid arthritis from Rigel Pharmaceuticals' - fostamatinib disodium (R788),