AstraZenca - Have they learnt the right lessons?

astrazeneca appears to be getting back on track . As per the latest AWACS data sales grew 39% in May 2013 , good sign that company is getting its act together finally .

Hi Shadab,

could you please post a link or details of how to check this AWACS data ?

Hi Raj

got that bit of info from below article in business line

http://www.thehindubusinessline.com/todays-paper/tp-corporate/astrazeneca-biocon-top-drug-sales-in-may/article4818112.ece

Yes, this growth data seems to be a very positive development…and the co should be back to pre-crisis level soon. Before the crisis, the stock used to trade at about 1300-1400 levels.

As per the presentation of the company, they hope to back to normalcy in a quarter or two of this year and by next year, they have guided PBT to be in high teens. Hence can the stock double in two years?

I exited the stock today. Results don’t seem to be that good.

I have also exited

This has run 100% in last 4 months.

Formed a wonderful base of accumulation for 4 years from Jan 14 to Jan 18.
Broke out of major Resistance line in Jan 18… with a markup …

Investors having information on fundamentals, kindly share…

AstraZeneca India (AZI) AGM notes AUG-2019.

Parent company/ CEO fully committed to AZ India business…no doubt about it…even during recent visit CEO has reaffirmed it.(They have granted 175 cr to company when AZI was in trouble).

Launching new patented products in India even before parent company does it in other EU countries. For eg: Tagrisso launched in india even before many EU.

There is no royalty payment to parent company for launching patented products
(Last yr royalty is for 3 rd party of China from whom we took licensed products…variable royalty based on sales .this yr sales have increased so is royalty)

No other separate PVT company in India from parent (they have pvt company for their global IT Services).

All revenue in India domestic no exports from AZI.

Focus on NCDs …cardiorenal metabolic,respiratory and oncology.

New launches and adequate products pipeline.

Brilinta 25 % of revenue …exclusivity will go off in Q4…many players to enter…( we are also preparing,no of MR and focus will increase on brilinta.

Oral anti-diabetes drugs have shown health growth …new drug launched last year.

Oncology : new drug for small cell lung…diagnostics facility not available with many centers.

For launch of new patented drug Govt of India may consider outside data but sometimes they ask us to do local trial… we are doing phase-4 for drug? with ongoing commercial use in India.

(Generics also have to show local data to some extent as its drug may have some effects based on genetics of Indian population. Generic drugs have to show that it’s bio similar to patent drug before launching in India to drug controller…but no clinical trial is needed as such.
Exclusivity is as per WTO… from the time of drug registration till 20 yrs…if we complete clinical trail by 10 yrs and launch it will have 10 years of exclusivity)

This seems interesting to me considering AZI will be getting the benefits of parent company R&D,no royalty payment to parent company,exclusivity of patented product, no other pvt company in India by parent (many MNC have pvt company with listed one like ABBOTT LTD). They do not share much guidance on future product pipeline. Even if one drug gets successful it can significantly increase the revenue. Present stock price looks very expensive and may correct if Brilinta goes off patent towards the end of year.(this was my expectation when I attended AGM but it is getting more expensive)

Disclosure: tracking position.

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Astrazeneca Pharma India touched 52 Week High of Rs 2914 with a Volume of about 40k shares today. A BSE Notification reads that they had a One-on-one meeting with Nippon India MF.

AstraZeneca got re-rated during the last few months like many other pharma MNCs on the back of very good nos. Brilinta(Ticagrelar) is their blockbuster product contributing to almost 25% of revenue which is supposed to go off patent in Q4(as mentioned during AGM) which may impact their revenue and margins. Until now I couldn’t find any company announcing the generic launch of Ticagrelor. There seems to be a legal battle regarding the same and its mentioned that Dr Reddy”s, Microlab and Natco pharma are allowed to sell generic version of ticagrelor at Rs.20 per tablet.(compare it with present price of Brilinta Rs.50/tab). I am not sure about any further ongoing legal issue and that may be the reason for companies not announcing launch of generic version.

Key question is, can AstraZeneca have enough patented products in the pipeline to compensate for the reduced revenue from Brilinta whenever it happens.
In FY20 till now AstraZeneca has launched 2 patented products in India:
1.Durvalumab (IMFINIZI) for treatment of lung and urothelial carcinoma.
a39eb739-49a1-4f69-ba38-16d79c5d367c.pdf (117.3 KB)
2.Fixed dose combination Dapagliflozin and Saxagliptin (QTERN) for Diabetes.
cec06797-2074-4a2d-9476-7eb6182dc464.pdf (115.0 KB)
Tracking of AstraZeneca at global level may give certain indications of potential launches in India.
Discl: Have been holding tracking quantity.

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Generic versions of Brilinta are already available in the market. Despite easy availability, doctors are still prescribing Brilinta. I think we will start seeing the heightened effect from FY21 onwards. Company has launched a lot of blockbuster drugs from the parent. Only time will tell how the story unfolds. Astra is one of the very few MNC pharma which doesn’t have any indian brands and is selling just the global ones.

Disc. Holding

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Do you think is it a positive or negative to sell only global brands ? Whats the next 3 year outlook ?

We can’t comment if it is a positive or a negative. Companies having both the strategies do well however I think given Indian patent lasts just for 5 years, they may exhaust their list of blockbuster drugs pretty fast. Another key variable to look at it is the acceptance of global drugs in India. I see next 3 years to be very good given the launches they have done however we will have to see if Indian doctors prescribe those drugs.

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Hi Astrazeneca has unlisted subsidiary in India as per this article https://www.equitybulls.com/admin/news2006/news_det.asp?id=266382
. Does it pose corporate governance risk ? Could new business be made through that subsidiary or is has some specific products only ? Whats your view. Thanks

Astrazeneca has announced q4 and Fy 20 results on 18/05/2020.Overall topline growth of 14% and PAT growth of 33% for the FY20.

Revenue and profit for the Q4 remains almost flat( PBT was high by 6cr).Even though it does not look impressive,considering their blockbuster product Brilinta is facing generic competition results for q4 looks decent. Some of the new products must have helped to some extent in maintaining growth and profitability. Difficult to get an idea about new products revenue as the company doesn’t give details.
Stock price got rerated from last one month. Some of this may be probably related to a few events happening at Astrazeneca global level. One of their oncology drug Tagrisso(osimertinib) used in non-small cell lung cancer (NSCLC) has shown positive results in the ADAURA Phase III trial study conducted.
https://www.astrazeneca.com/media-centre/press-releases/2020/tagrisso-phase-iii-adaura-trial-will-be-unblinded-early-after-overwhelming-efficacy-in-the-adjuvant-treatment-of-patients-with-egfr-mutated-lung-cancer.html

Tagrisso was already launched in India( sometime in 2018). As the clinical efficacy is proven with studies these drugs can add significant revenue and profit to the company.

Astrazenac has done manufacturing tie up with Oxford university which is developing vaccine for Covid and currently in Phase 2. Even if its successfully develops a vaccine, will it have any implication on Astrazeneca India ( Hope they will be successful and market it on humanitarian basis considering the crisis)
https://www.fiercepharma.com/manufacturing/astrazeneca-oxford-biomedica-agree-to-1-year-tie-up-to-produce-covid-19-vaccine.
(Discl: Invested)

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Flat growth for the quarter can be attributed to logistics challenges.

Monthly growth as per secondary sales data of AIOCD was 7% Jan, 14.4% Feb and 17% in March.

Company has mentioned in the results that they face logistics issue due to lockdown; so i think the primary sales were impacted due to this. Plus, if one sees the inventory levels there has been a sharp rise in inventory levels from H1FY20 to H2FY20, which also indicates that they were not able to move the products.

On Tagrisso, the brand has been growing 40-50%.

The only challenge currently is the generic launch of their FORXIGA brand, Natco Pharma has launched a generic version of the same in April. This is an important product for Astrazeneca as it contributes nearly 25% of revenues. And with BRILINTA already going generic last year, this can act as a double whammy.

But, FORXIGA’s patent will expire only in Oct 2020, so they will most likely get an injunction on the same.

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@ankush12495. Agree that logistics was an issue and impact on revenue. Thank you for sharing growth of each brand. How do you get it. Is it available freely?
Regards.

Sebi’s Final order on 2014 delisting debacle…

https://www.sebi.gov.in/enforcement/orders/jun-2020/order-in-the-matter-of-astrazeneca-pharma-india-ltd-_46785.html

Anyone has any insights into how the pay of an MR works? Is it full variable or Fixed+Variable?
Trying to figure out if there can be some operating leverage from the employee costs as the sales increases.