AstraZeneca's Soriot Warns US Against Trade Tariffs on Medicines
AstraZeneca Plc's Chief Executive Officer Pascal Soriot warned that trade tariffs are not the best way to manage pharmaceuticals and that drugmakers are calling for no additional US levies on medicines.
'We actually believe that a better incentive to attract investment in manufacturing and in R&D is to have a great tax policy that incentivizes companies to invest in the country,' Soriot said on Bloomberg TV on Tuesday.
AstraZeneca believes any impact of levies on the company would be short-lived given its manufacturing presence in the US. Still, Soriot said the industry is calling on the Trump administration not to put levies on imported medicines, after they were excluded from recent announcements.
The drugmaker posted higher profit in the first quarter that still disappointed investors due to weaker than expected sales of key cancer medicines. The company's shares fell as much as 4.7% in early trading in London, and are down about 16% over the past year.
Astra said it is discontinuing a late-stage trial of its Truqap prostate cancer treatment, based on a recommendation from an independent data monitoring committee. Truqap is already approved for treating breast cancer.
Earnings per share, excluding some items, were $2.49, the company said Tuesday, above the $2.26 estimated by analysts surveyed by Bloomberg.
Sales of major cancer medicines were lower than anticipated, with Bloomberg Intelligence analyst John Murphy saying in a note that weakness in cancer and rare disease drugs were a potential source of concern. Still, sales of its diabetes and heart disease drug Farxiga were nearly 6% higher than expected, while revenue from its newer cancer medicine Enhertu was also ahead.
The British drugmaker confirmed its guidance for the year and also said it was committed to investing and growing in the US.
Astra has already announced a $3.5 billion investment in its US business by the end of 2026. The cash will go toward research and development as well as manufacturing.
Astra is also trying to move on from a damaging probe into current and former employees in China that ensnared the drugmaker's president in the country. The company said it received an appraisal opinion in April from Shenzhen City Customs Office regarding suspected unpaid importation taxes amounting to $1.6 million, which Astra said likely relates to Enhertu.
'A fine of between one and five times the amount of unpaid importation taxes may also be levied if AstraZeneca is found liable,' the company said.
Analysts had previously been reassured by Astra's earlier estimate that it could be fined just $4.5 million for suspected unpaid import taxes for two other cancer medicines Imfinzi and Imjudo.
The latest update on China would likely be welcomed by investors, Jefferies' analyst Benjamin Jackson said in a note.
This year Astra announced a $2.5 billion research hub in Beijing as it seeks to capitalize on booming interest in the scientific prowess emerging in China. The project indicated a strong partnership with the government despite the probe.
The drugmaker has had several positive readouts this year from potential blockbuster medicines, including data from its experimental cholesterol drug that significantly reduced 'bad' cholesterol in a mid-stage trial. That could be part of a powerful combination drug targeting weight loss and related ailments.
This article was generated from an automated news agency feed without modifications to text.
First Published: 29 Apr 2025, 01:36 PM IST
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