Big Pharma Earnings Watch: Astrazeneca
Another Brand Name Drug Maker Beats Expectations After Raising Prices
Rounding out this week’s reporting on third quarter earnings, Big Pharma giant AstraZeneca joined four other brand name giants in beating expectations after raising prices on their products earlier this year.
- AstraZeneca reported $6.1 billion in revenue, beating expectations of $5.8 billion.
- The company raised its annual sales forecast for the second time this year, thanks to strong profits from new cancer treatments.
- Earlier this year, AstraZeneca hiked the price of its popular heartburn medication, Prilosec, by five percent.
AstraZeneca has a history of hiking prices on Americans struggling to afford their medications:
- As AstraZeneca Faced Generic Competition To Its High Cholesterol Drug Crestor, Its “Price Was Increased Several Times Before The Generic Came Out … Including By About 15 Percent Right Before.” “AstraZeneca’s AZN, -0.08% drug Crestor, another of the drugs featured in the report, is a popular but expensive drug that treats high cholesterol. In 2016, when the drug first got a new generic rival, the branded product cost about $300 a month without insurance coverage. The price was increased several times before the generic came out … including by about 15% right before. (AstraZeneca said it could not comment because it was not involved in the study.)” (Emma Court, “Big Pharma Games The System To Make Generic Drugs More Expensive,” MarketWatch, 8/3/18)
- AstraZeneca’s Pricing Strategy Served To Create “A New, Higher Baseline Price When The Generic Hits The Market.” (Tori Marsh, “Prices For Brand Drugs Spike Before A Generic Is Released. Here’s Why.,”GoodRx, 7/27/18)
- After Increasing Drug Prices By As Much As Nine Percent, On A 2018 Earnings Call, Soriot Insisted The Company Was “Sensitive” To Drug Pricing Concerns And Said It Had Raised “Wholesale Prices Earlier [That] Year By ‘Very, Very Modest’ Amounts.” “During an earnings conference call, the AstraZeneca chief executive disclosed the company would not raise prices in the U.S. for the rest of year. Other drug makers have taken the same step in response to pressure from the Trump administration, but he insisted this was ‘our plan … all along’ … He maintained AstraZeneca was sensitive to the problem by raising wholesale prices earlier this year by ‘very, very modest’ amounts, ‘between 1 and 3 percent’ which, he said, was ‘in line with inflation.’” (Ed Silverman, “When Modest Is Actually Excessive: AstraZeneca Spins Its Price Hikes,” STAT News, 7/26/18)
So far, brand name Big Pharma giants, including Eli Lilly
, Johnson & Johnson, Roche and Novartis
, have run the table on Q3 earnings expectations after continuing to hike prices on their brand name drugs.
Stay tuned next week to see if Amgen, Merck, Pfizer, GlaxoSmithKline, Bristol-Myers Squibb, Sanofi and AbbVie, will continue the trend.