(Reuters) – AstraZeneca (NASDAQ:AZN) on Thursday beat expectations for first-quarter profit and revenue, as buoyant sales of cancer drug Imfinzi and strong demand for its roster of drugs in emerging markets helped to offset dwindling COVID product sales.
The company’s sales and outlook highlight the rapid decline of its COVID vaccine, its best-selling product in 2021 at the height of the pandemic, which has struggled to compete with rival shots developed by Pfizer (NYSE:PFE) and Moderna (NASDAQ:MRNA).
The London-listed drugmaker, which reports its results in U.S. dollars, reported adjusted profit of $1.92 per share on sales of about $10.9 billion.
Analysts on average were expecting $1.71 per share on sales of about $10.6 billion, according to company-compiled consensus estimates.
AstraZeneca’s stock ticked up about 1% higher in early trading.
The company’s cancer drug Imfinzi generated $900 million in the quarter, handsomely beating estimates of $735 million from brokerage Cowen.
Sales of its COVID-19 vaccine dropped to $28 million in the first quarter, versus $1.14 billion over the same period last year, as the company lost ground to rival mRNA shots.
CEO Pascal Soriot said AstraZeneca’s performance in emerging markets was particularly strong.
Excluding sales of its COVID-19 products, sales rose 22% to $3.1 billion in emerging markets on a constant currency basis.
AstraZeneca is seen as a bellwether for the pharmaceutical sector in China, given its outsized presence in the region. In 2022, the country accounted for about 13% of the company’s total revenue.
Sales in China were hurt last year by lower drug prices, while the country’s tough zero-COVID policy, which was abandoned in December, has kept some patients from being diagnosed and seeking care.
But sales started to pick up in the second half of 2022, and the company generated 11% sales growth, excluding COVID products, in the region on a constant currency basis in the first quarter of 2023.
With AstraZeneca’s COVID-19 vaccine losing ground to rival mRNA shots and its COVID therapy falling out of favour due to newer variants, combined sales of these products came in 30% below consensus estimates, J.P. Morgan analysts wrote in a note.
The Anglo-Swedish drugmaker stood by its 2023 forecast on Thursday.
Given the strength of the quarterly performance, the market is likely to gain increased confidence in the company delivering on its full-year forecast, the analysts added.
