AstraZeneca Pharmaceutical Company Analysis Report
Summary
- AstraZeneca with $1.1bn sales equivalent 1.9% sales share was the sixth largest company in the BRIC countries in 2009. Its BRIC operations posted a double digit year-on-year growth of 15.2%.
- China was AstraZeneca’s largest market in the BRIC countries with $537m sales equivalent to 48.2% of the company’s in these markets in 2009. Brazil was the next largest BRIC market with sales of $324m, 29.1% of the company’s BRIC sales.
- Cardiovascular drugs were the leading therapeutic drug class for AstraZeneca in the BRIC markets with sales of $325m sales registering 18% year-on-year growth. Drugs for alimentary tract and metabolism were the second best selling therapy area for Astra Zeneca with sales of $233m and year-on-year growth of 24.5%.
- Losec and Nexium belonging to the alimentary tract and metabolism drug class were the leading brands for AstraZeneca in the BRIC market with sales of $120m and $112m in 2009.
- AstraZeneca’s alliance with UCB to market products in Brazil and the inclusion of its brands in China’s National Reimbursement List will significantly boost the company’s revenue from the BRIC markets.
Company overview
The
merger between Astra AB (Sweden) and Zeneca Group (UK) created AstraZeneca in
1999. After the merger, the company divested its agrochemical and specialty chemicals
businesses, previously a part of Zeneca group to concentrate its focus on core
prescription products. The company develops and markets products for diseases
affecting the cardiovascular, gastrointestinal, nervous and respiratory systems
in addition to drugs indicated for cancer and infections.
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Table 42: Overview of AstraZeneca
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Headquarters
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UK
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Global sales
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$34.4bn
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BRIC sales
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$1.1bn
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Market share (% of total global sales in BRIC)
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3.2
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Major therapeutic focus
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Cardiovascular system
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Source: IMS Health, copyright ©, reprinted with permission, company
reports
Therapeutic focus
Drugs
indicated for the treatment of cardiovascular disorders and for the alimentary
tract and metabolism accounted for 50% of the sales of AstraZeneca’s BRIC
pharmaceutical portfolio. Brazil accounted for 55.1% of AstraZeneca’s
cardiovascular business in the BRIC markets. The company’s top selling
cardiovascular brands include Cestor, Betaloc and Prendil in BRIC. China
accounted for 70.5% of AstraZeneca’s alimentary tract & metabolism
franchise in the BRIC markets.
Geographic focus
AstraZeneca’s
BRIC operations have demonstrated robust performance over the past five years.
At current rates, sales from the BRIC markets will double in five years. China
accounted for 48.2% of AstraZeneca’s sales in the BRIC market. Table
43 illustrates AstraZeneca’s sales performance in the BRIC markets in 2009.
Table 43: AstraZeneca’s sales distribution across BRIC countries,
2009
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Country
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Sales 2009 ($m)
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Sales growth, 2008–09 (%)
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Sales share, 2009 (%)
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CAGR, 2005–09 (%)
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China
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537
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31.4
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48.2
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32.3
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Brazil
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324
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11.5
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29.1
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29.4
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Russia
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189
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-9.2
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17.0
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19.2
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India
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65
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7.3
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5.8
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9.3
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Total
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1,115
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15.2
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100.0
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26.9
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Source: IMS Health, copyright ©, reprinted with permission
Marketed products
Table 44: Leading brands of AstraZeneca in the BRIC market, 2009
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Brands
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Sales 2009 ($m)
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Sales growth, 2008–09 (%)
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Sales share, 2009 (%)
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CAGR, 2005–09 (%)
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Losec
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120
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26.3
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10.7
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20.5
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Nexium
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112
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22.5
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10.0
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44.6
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Crestor
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98
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34.3
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8.8
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71.4
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Betaloc
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85
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15.7
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7.6
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25.4
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Diprivan
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71
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29.8
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6.4
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30.4
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Seroquel
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62
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18.3
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5.6
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41.3
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Plendil
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54
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28.8
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4.8
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21.4
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Arimidex
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51
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6.3
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4.6
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24.1
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Pulmicort
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50
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34.2
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4.5
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37.7
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Merrem
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49
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-8.4
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4.4
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16.4
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Top 10
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751
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21.2
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67.4
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31.0
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Others
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364
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4.6
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32.6
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20.1
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Total
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1,115
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15.2
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100.0
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26.9
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Source: IMS Health, copyright ©, reprinted with permission
R&D
AstraZeneca’s
global R&D expenditure in 2009 was $4.4bn, equivalent to 12.8% of the
company’s consolidated sales. AstraZeneca has 17 R&D centers spread across
eight countries and employs 11,400 researchers across various therapeutic
divisions. Among the BRIC countries, R&D centers are located in India and
China. One of the main focus areas of the Indian center is the development of
drugs for tuberculosis.
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Table 45: AstraZeneca’s late stage R&D pipeline
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Molecule
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Indication
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Dapagliflozin
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Diabetes
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TC-5214
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Major depressive disorder (adjunct)
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Vimovo
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Signs and symptoms of osteoarthritis, rheumatoid arthritis
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Ceftaroline
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Pneumonia /skin infections
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MEDI-3250
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Seasonal influenza
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Vandetanib (Zactima)
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Medullary thyroid cancer - orphan
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Source: Company reports
Growth strategy
Indian
generic drug maker Aurobindo Pharma and AstraZeneca have entered into a supply
and distribution agreement regarding solid dosage and sterile products for the
anti-infective, cardiovascular system and central nervous system therapy areas,
whereby the latter will gain access to and commercialize branded generics in
the emerging markets. AstraZeneca will distribute these products in 40 emerging
markets excluding India and China. AstraZeneca has also signed an agreement
with Indian generic manufacturer Torrent to market 18 products in nine emerging
countries. The deal is flexible with AstraZeneca holding the right to expand
the product portfolio in countries where it anticipates strong commercial
growth.
AstraZeneca
has entered into a partnership with UCB to market the latter’s Cimzia in
Brazil. Cimzia is a PEGylated anti-TNF alpha drug indicated for the treatment
of Crohn’s disease and rheumatoid arthritis. According to the agreement, UCB
maintains rights to co-promote the drug and any future line-extensions in
Brazil. The alliance will however still support AstraZeneca’s strategy to
expand its presence in Brazil.
Product launches
AstraZeneca
along with Bristol-Myers Squibb launched the anti-diabetic drug Onglyza
(saxagliptin) in India in April 2010. India is the first Asian country where
the drug has been launched. Onglyza will compete with other DPP-4 (dipeptidyl
peptidase) inhibitors – Merck’s Januvia and Novartis’ Galvus. The drug though
highly priced when compared to the first-line therapy metformin in India, is at
a low price compared to the other DPP-4 inhibitors. AstraZeneca plans to tap
the growing diabetes market in India driven by Onglyza’s favorable side effect
profile and benefits including reduced weight gain and effective reduction in
the glycosylated hemoglobin level in the blood when compared to other
anti-diabetic medications.
A
wide range of AstraZeneca products have been incorporated in China’s National
Reimbursement Drug List (NRDL) published by the Ministry of Human Resource and
Social Security (MHRSS) including Crestor, Nexium, Symbicort and Seloken XR.
AstraZeneca’s brands Seloken and Losec have also been included in China’s
National Essential Drug List (NEDL). Consequently, government owned healthcare
institutions will stock these drugs.
AstraZeneca
has acquired Vancocin CP (vancomycin) from Eli Lilly for India and Nepal.
Vancomycin is the first choice drug for the treatment of MRSA (methicillin
resistant staphylococcus aureus). AstraZeneca considers that this acquisition
will complement its brand Meronem which is indicated for extended spectrum
beta-lactamase (ESBL) infections. Vancocin has been marketed in India since
1994.
SWOT
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Table 46: SWOT analysis – AstraZeneca
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Strengths
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Weaknesses
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AstraZeneca is the sixth largest company in BRIC with a focus on
cardiovascular, oncology, CNS and respiratory therapy areas.
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AstraZeneca Pharma India's public shareholders rejected delisting
of the company.
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Wide range of products included in China's National reimbursement
Drug List (NRDL) including Crestor, Nexium, Symbicort and Seloken.
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Discontinuation of products in late stage clinical trials
including drugs for thrombosis, COPD, recurrent glioblastoma, schizophrenia.
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Opportunities
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Threats
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Seroquel approved by the EU and the FDA as an adjunct in the
treatment of major depressive disorder (MDD). The extended approval will be
reflected in the Brazilian market in 2011.
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Patent expiries of key products including Seroquel and Arimidex in
the next five years threaten the company’s revenues.
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The first reversible binding oral P2Y12 adenosine diphosphate
receptor (ADP) antagonist Brilinta receives positive recommendation for
approval from an FDA advisory panel.
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AstraZeneca's marketing alliance with India's Aurobindo Pharma and
Torrent will strengthen the company's marketing base in the country.
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