We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Though the drug sector was off to a strong start in 2018, it has struggled thereafter, probably on U.S. market instability and a few negative updates on the pipeline and regulatory front. Only four large-cap drug stocks have risen this year including AstraZeneca, Merck (MRK - Free Report) , AbbVie, Inc. (ABBV - Free Report) and Glaxo (GSK - Free Report) .
Factors Driving AstraZeneca Stock
AstraZeneca announced quite a few positive developments on the regulatory and pipeline front this year, which led shares to outperform the industry.
AstraZeneca recorded good progress in Oncology in the first quarter of 2018. Lynparza received EU approval for a broad second-line ovarian cancer indication with the tablet formulation, and for breast cancer in the United States. Tagrisso received the important U.S. approval for first-line EGFR mutated non-small cell lung cancer (NSCLC). PD-L1 inhibitor Imfinzi was approved and immediately launched for the second indication in the United States — early stage lung cancer — which drove sales higher in the first quarter.
In hematology, moxetumomab submission was accepted by the FDA and granted priority review for an intended indication in third-line hairy cell leukemia. In CVRM, AstraZeneca received EU and U.S. approval for Lokelma to treat hyperkalemia. In Respiratory, biologic medicine, Fasenra was approved in the EU and Japan in January.
There were however a few negative pipeline updates. Fasenra did not meet the primary endpoint in the first COPD trial, GALATHEA. The ARCTIC trial of Imfinzi plus tremelimumab in third-line non-small cell lung cancer did not meet the primary endpoint of progression-free-survival (PFS) and overall survival (OS). Meanwhile, its core products like Nexium, Crestor and Seroquel are facing generic competition, which is hurting sales growth. The diabetes franchise also faces stiff competition while pricing pressure is hurting sales in AstraZeneca’s Respiratory franchise.
Nonetheless, AstraZeneca’s newer drugs like Brilinta (cardiovascular), Lynparza (ovarian cancer), Farxiga/Forxiga (type II diabetes) and Tagrisso (lung cancer) are doing well. Brilinta and Farxiga achieved blockbuster status in 2017, exceeding $1 billion in sales. Imfinzi and Fasenra, launched in 2017/early 2018, are off to a strong start given their highly competitive clinical profile. AstraZeneca is also looking for further label expansions for these drugs.
Its newer medicines registered sales growth of 66% in the first quarter of 2018. These new drugs should keep contributing to the top line while several launches are underway across each of the therapeutic areas, Oncology, CV metabolism and Respiratory. AstraZeneca is looking to return to growth in 2018 on the back of newer drugs. Meanwhile, cost-cutting initiatives should drive the bottom line.
All these positive developments are likely to keep the stock’s momentum alive this year.
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
Image: Bigstock
AstraZeneca (AZN) Stock on Growth Path This Year: Here's Why
Shares of AstraZeneca, PLC (AZN - Free Report) have risen 4.8% so far this year against the Large-Cap Pharma industry’s decline of 4.9%.
Though the drug sector was off to a strong start in 2018, it has struggled thereafter, probably on U.S. market instability and a few negative updates on the pipeline and regulatory front. Only four large-cap drug stocks have risen this year including AstraZeneca, Merck (MRK - Free Report) , AbbVie, Inc. (ABBV - Free Report) and Glaxo (GSK - Free Report) .
Factors Driving AstraZeneca Stock
AstraZeneca announced quite a few positive developments on the regulatory and pipeline front this year, which led shares to outperform the industry.
AstraZeneca recorded good progress in Oncology in the first quarter of 2018. Lynparza received EU approval for a broad second-line ovarian cancer indication with the tablet formulation, and for breast cancer in the United States. Tagrisso received the important U.S. approval for first-line EGFR mutated non-small cell lung cancer (NSCLC). PD-L1 inhibitor Imfinzi was approved and immediately launched for the second indication in the United States — early stage lung cancer — which drove sales higher in the first quarter.
In hematology, moxetumomab submission was accepted by the FDA and granted priority review for an intended indication in third-line hairy cell leukemia. In CVRM, AstraZeneca received EU and U.S. approval for Lokelma to treat hyperkalemia. In Respiratory, biologic medicine, Fasenra was approved in the EU and Japan in January.
There were however a few negative pipeline updates. Fasenra did not meet the primary endpoint in the first COPD trial, GALATHEA. The ARCTIC trial of Imfinzi plus tremelimumab in third-line non-small cell lung cancer did not meet the primary endpoint of progression-free-survival (PFS) and overall survival (OS). Meanwhile, its core products like Nexium, Crestor and Seroquel are facing generic competition, which is hurting sales growth. The diabetes franchise also faces stiff competition while pricing pressure is hurting sales in AstraZeneca’s Respiratory franchise.
Nonetheless, AstraZeneca’s newer drugs like Brilinta (cardiovascular), Lynparza (ovarian cancer), Farxiga/Forxiga (type II diabetes) and Tagrisso (lung cancer) are doing well. Brilinta and Farxiga achieved blockbuster status in 2017, exceeding $1 billion in sales. Imfinzi and Fasenra, launched in 2017/early 2018, are off to a strong start given their highly competitive clinical profile. AstraZeneca is also looking for further label expansions for these drugs.
Its newer medicines registered sales growth of 66% in the first quarter of 2018. These new drugs should keep contributing to the top line while several launches are underway across each of the therapeutic areas, Oncology, CV metabolism and Respiratory. AstraZeneca is looking to return to growth in 2018 on the back of newer drugs. Meanwhile, cost-cutting initiatives should drive the bottom line.
All these positive developments are likely to keep the stock’s momentum alive this year.
AstraZeneca currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>