Drugs giant AstraZeneca reported plunging half-year sales and profits on Thursday amid competition from cheaper generic drugs and challenging market conditions.
The UK’s second-biggest pharmaceuticals group said pre-tax profits in its core business dropped by a quarter to $5.1 billion (£3.3bn) after revenues fell 16 per cent to $14bn.
AstraZeneca – whose chief executive David Brennan quit in June after shareholder pressure following profit warnings and poor performance – said nearly all the revenues fall came as a result of generic competition, including for its best-selling
antipsychotic drug Seroquel.
Western Europe, including the UK, was the group’s worst performing region as it suffered from the eurozone crisis, with a 23 per cent fall in revenues in the six months to 30 June.
The US business also saw a 20 per cent slide in revenues and China was the only country to see sales increase, up 17 per cent.
Astra is slashing jobs and cutting costs to offset poor performance, having announced its intention to axe 7,300 roles in February.
It said it was making “good progress” on cost reductions and remained on track to deliver $1.6bn in savings by the end of 2014.
Simon Lowth, interim chief executive, said: “As we expected, the loss of exclusivity on some key brands and tough market conditions have resulted in a decline in revenue and earnings in the second quarter.
“Our long-term priorities remain unchanged. We are driving the performance of brands that retain exclusivity.”
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