Sector News

AstraZeneca’s anti-Pfizer growth promises? At least one big investor is buying

November 18, 2014
Life sciences
When Pfizer and Merck KGaA announced their big immuno-oncology deal Monday, market watchers immediately started extrapolating. The tie-up means Pfizer won’t come back for another try at AstraZeneca, some say. But others figure that there’s still a solid chance of Pfizer, round two.
AstraZeneca itself is among them, and the U.K.-based drugmaker is once again touting its long-term prospects for any and all investors who might be listening. Return to growth by 2017, $45 billion in sales by 2023, several new drug filings next year–the subtext is clearly a repeat of May’s presentation in defense against Pfizer’s May offer.
So is the high-profile British investor Neil Woodford. As AstraZeneca convened its annual investor meeting Tuesday, Woodford set the odds of a Pfizer return at 50-50. But that doesn’t mean he’s in favor. For one thing, Pfizer probably can’t afford to pay enough to outweigh the value of AZ’s pipeline over the long term, he figures.
Plus, Big Pharma has a terrible record when it comes to megamergers, Woodford says, echoing comments from not only AstraZeneca CEO Pascal Soriot but also analysts who’ve watched big M&A deals stall R&D and fail to deliver on market value. Pfizer itself, Woodford points out, is the product of one big merger after another, with not much to show in market cap for the billions paid for those buyouts.
How much value can AstraZeneca create on its own? That $45 billion sales goal is an enormous increase over 2013’s $27 billion, and 2014’s sales are expected to grow only a bit. But big leaps are in store in oncology, the company said Tuesday, adding that field to its previously tagged growth platforms: diabetes, respiratory, emerging markets, Japan and the blood thinner Brilinta, all of which helped drive a 4% increase in 9-month revenue.
Woodford thinks the 75% sales hike is doable, increasingly so, given the company’s progress over the last 6 months. “AstraZeneca’s target to increase revenues by three quarters over the next decade is a tough one, but one which we believe can be achieved,” Woodford said.
By Tracy Staton

Related News

September 18, 2020

Eli Lilly, Amgen join forces to scale production of COVID-19 antibody cocktails

Life sciences

Months of fervid research have whittled away most potential options to treat patients with COVID-19, a group of antibody cocktails still hold promise. Eli Lilly believes so strongly in its contender that it’s […]

September 16, 2020

Takeda unveils new Boston R&D manufacturing center for cell therapy pipeline push

Life sciences

Japanese drugmaker Takeda has trumpeted its plan in recent years to cut billions of dollars in costs and pivot around oncology and rare diseases. A key part of that strategy […]

September 15, 2020

AstraZeneca, Oxford restart stalled COVID-19 test as Pfizer ramps up trial numbers for its vaccine

Life sciences

Just under a week after it stopped its key phase 3 pandemic vaccine test, AstraZeneca and the University of Oxford have been given the green light to restart in the […]