AstraZeneca shares rise as cancer drug sales boost quarterly profit

AstraZeneca shares (LSE: AZN) climbed over 3% on Thursday after the pharmaceutical giant reported higher third-quarter pretax profit, driven by strong sales growth of its cancer drug Enhertu. The company also announced it signed an exclusive agreement for an experimental obesity drug.

The UK-based drugmaker said pretax profit in the three months to September rose 79% to $1.65 billion from $922 million a year earlier. However, net profit fell 16% to $1.38 billion due to a swing in tax effects.

Revenue increased 4.6% to $11.49 billion, aided by solid uptake of lymphoma drug Calquence despite growing competition.

A key growth driver was Enhertu, an antibody-drug conjugate AstraZeneca co-develops with Japan’s Daiichi Sankyo for certain breast cancers. Enhertu sales nearly doubled year-on-year to $1.84 billion in the first nine months of 2023.

“Our company continued its strong growth trajectory in the third quarter with total revenue from our non-Covid-19 medicines up 13%,” said CEO Pascal Soriot.

AstraZeneca now expects full-year earnings growth in the “low double-digit to low-teens percentage” range, up from its prior forecast of “high single-digit to low double-digit” growth.

In a separate announcement, the company said it signed an exclusive global deal to develop and commercialise ECC5004, an experimental treatment for obesity and metabolic conditions from Shanghai’s Eccogene.

The deal positions AstraZeneca to compete with Danish firm Novo Nordisk, a leader in the weight loss drug market. ECC5004 showed body weight reductions versus placebo in early testing.

Under the agreement, AstraZeneca will pay Eccogene $185 million upfront and up to $1.83 billion more in milestones.

Additionally, the company reported positive late-stage trial results for its Imfinzi immunotherapy in combination with bevacizumab and chemoembolization to treat liver cancer.

Executive Vice President Susan Galbraith said the data could bring Imfinzi “to patients with earlier stages of liver cancer,” pending regulatory discussions.

AstraZeneca shares are down about 9% year-to-date, but rose sharply on Thursday’s profit beat and pipeline progress. The stock remains down 3% over the past 12 months.