British–Swedish multinational pharmaceutical company AstraZeneca on Thursday forecast higher sales in 2022 after posting a better-than-expected fourth-quarter profit.
But the biotechnology company warned that it expects revenues to decline as sales of its COVID-19 products drop, and that the gross profit margins from those products would be lower than the company average.
The drugmaker recorded full-year revenues of $37.4 billion in its fourth-quarter results (pdf), an increase of 38 percent from the year before.
Part of the boost in revenue came from $4 billion in sales of its COVID-19 vaccine, which was developed with the University of Oxford.
In the final quarter, sales rose 62 percent to $12 billion. For 2022, AstraZeneca forecast total group sales to rise by a “high teens percentage.”
However, the drugmaker warned that COVID-19 revenues would decline by “a low-to-mid twenties percentage.”
“Total Revenue from COVID-19 medicines is anticipated to decline by a low-to-mid twenties percentage, with an expected decline in sales of Vaxzevria being partially offset by growth in Evusheld sales,” the company said.
The U.S. Food and Drug Administration (FDA) issued an emergency use authorization on Dec. 8 for Evusheld. It is the only antibody therapy authorized in the United States for preventative COVID-19 treatment.
“The majority of vaccine revenue in 2022 is expected to come from initial contracts. The Gross Profit Margin from the COVID-19 medicines is expected to be lower than the Company average,” AstraZenica said.
For 2022, analysts currently estimate earnings per share of $6.68 and sales of $42.73 billion, according to Refinitiv IBES data.
AstraZeneca announced plans to start selling its COVID-19 shots at “modest profitability” back in November, after previously saying it would not take a profit from its COVID-19 vaccines during the pandemic.
It said that the “limited profit” will offset costs related to its antibody drug developed to prevent and treat COVID-19, the disease caused by the CCP (Chinese Communist Party) virus.
However, the company said that low-income nations would continue to receive the vaccine on a no-profit basis.
“AstraZeneca continued on its strong growth trajectory in 2021, with industry-leading R&D productivity, five of our medicines crossing new blockbuster thresholds, and the acquisition and integration of Alexion,” said Pascal Soriot, CEO of AstraZeneca.
“We also delivered on our promise of broad and equitable access to our COVID-19 vaccine with 2.5 billion doses released for supply around the world,” he said.
“Growth was well balanced across our strategic areas of focus, and we saw double-digit growth in all major regions, including Emerging Markets despite some headwinds in China.”
“This, along with the transformative acquisition of Alexion, means that we are confident in our long term growth and profitability. After a landmark year in 2021, we are increasing the dividend for our shareholders,” Soriot said.
Citing preliminary data from an ongoing clinical trial, AstraZenica said in January that its COVID-19 vaccine, called Vaxzevria, generated an antibody response against the Omicron variant of the virus when given as a third booster dose to individuals who were earlier inoculated with either AstraZeneca’s shot or an mRNA jab.
Vaxzevria has not yet been approved by U.S. regulators.
AstraZeneca company said it plans to submit the data to health regulators for approval for use as a third shot globally. However, the AstraZeneca vaccine has faced scrutiny regarding its efficacy data, with links to potential side effects such as blood clots.
AstraZeneca shares were up 0.97 percent at $57.20 as of 11:21 a.m. GMT on Thursday.