AstraZeneca PLC (NASDAQ:AZN) Q3 2022 Earnings Call Transcript

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David Fredrickson: Yes. Tim, the growth that we saw in third quarter came from continuation of progress on DESTINY-Breast03 and we continue to see good inroads as we displace use in that second-line HER2 high population. And then I would say that the real change in velocity, if you will, of the uptake is the addition of the HER2 low DBO4 launch, I do think that we might have some bolus of patients coming on across multiple lines of post chemotherapy. There is not though a stocking effect in there. So there may be some demand bolus that we see. And we’ll have to see what the duration of therapy is for some of these patients. I would imagine that if you’re a six line, post chemo patient that had to look different than if you’re a third line.

So I think that some of what we’ll need to say play out. But it is all demand based from what we’ve seen, and there’s still quite a few patients that are not receiving Enhertu in this post chemo setting. So there’s a lot of growth still, quite a lot actually still remaining. In terms of the overall outlook, I think in Enhertu could be one of the largest medicines in oncology going forward and whether or not that’s bigger or less than Tagrisso. I think Tagrisso is one of the largest also. So I sort of put them all in the same category.

Pascal Soriot: But it can be very big. If you look at in market sales, right, that’s I think Dave was talking about in market sales, because of course, we only record a little bit less than half of those sales here. But it will, in a way, enter this partnership, assuming good product, but more modest forecast. And in fact, we are rapidly moving to an upside here that will make Enhertu a very large product in the industry. Aradhana, do you want to cover the second one?

Aradhana Sarin: Sure. So relating to the NEXIUM liability, this was originally obviously a product that was developed through the Astra-Merck venture. And at that point, AZ kept the products and the liability, and we paid market share of the profits. Going forward and where the cases stand today, we’re essentially liable for our own, whatever happens in this litigation, we’re obviously very confident in our position and we continue to defend vigorously as you know, already 5,000 cases have been dismissed, and the first of the pending cases will start trial early next year. And you know we’ll see how they go one by one.

Pascal Soriot: Thank you. over to you.

Unidentified Analyst: Yes, thanks so much for taking my question. Questions sort of relating to an earlier question on Evusheld and its long-term projections, which consensus at least carry material expectations from. So when the company guides for double-digit growth 2025 and then industry-leading growth beyond ’25, to what extent should we be thinking on pandemic-related revenue as part of those growth projections, or rather the opposite that’s all such statements exclude for pandemic related revenues. And then secondly, I know you’re not going to talk about core EPS outlook for ’23 here today, but consensus apparently is carrying a low single-digit R&D increase for next fiscal year. And I’m trying to reconcile that with the readouts for next year. Any help there will be appreciated.

Pascal Soriot: Thank you, Matthias. Let me just cover the first one which really relates to statements we made in the past. When the first time we made those goal statements, we didn’t really know what Evusheld would look like, quite frankly. So those growth projections that were made outside of the COVID franchise . And of course, now you have to sort of adjust to some extent for this sales we’ve experienced in between. But fundamentally the long-term growth doesn’t depend — doesn’t rely on the COVID franchise. We hope and we believe that Evusheld and Evusheld 2.0 can be durable over the next few years. But certainly our leading growth rate forecast beyond 2025 doesn’t depend on it. To core EPS, you want to cover that question, Aradhana?

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