AstraZeneca boss denies overpromising vaccine supplies to EU

Firm reveals it has made $275m from Covid-19 vaccine sales

A nurse holds up a vial of the AstraZeneca-Oxford Covid-19 vaccine at the Ngaliema Clinic in Kinshasa, Democratic Republic of Congo. The vaccine represented about 4 per cent of AstraZeneca’s revenue for the quarter. ReutersShow less

AstraZeneca boss Pascal Soriot denied on Friday that his company had overpromised vaccine supplies to the EU, days after Brussels launched legal action as part of a months-long feud with the pharmaceutical firm.

Mr Soriot said AstraZeneca had done its best to deliver as many doses as possible to the EU, which claims that the firm failed to respect its contract to deliver 300 million shots by the end of June.

Separately, the pharmaceutical company on Friday said it had made $275 million from Covid-19 vaccine sales, after it reported robust revenue growth in the first quarter of the year.

It is the first time the British-Swedish firm, which is listed on the FTSE100, has offered details about the sales and distribution of its vaccine, which it developed with the University of Oxford and produces and supplies at cost.

Mr Soriot defended his firm's work and said that AstraZeneca had "never pretended that we were going to be perfect".

"We never overpromised, we communicated what we thought we would achieve at the time," he said.

"Our vaccine continues to play a leading role in the global fight against the pandemic."

He contrasted AstraZeneca's efforts with the dozens of other vaccine candidates that never made it into production at all. "Where are all those vaccines? They are nowhere," he said.

The Covid-19 vaccine represented just under 4 per cent of AstraZeneca’s revenue for the quarter, with total revenue rising 11 per cent on the year to $7.32 billion at constant exchange rates for the three months to March, while core earnings stood at $1.63 cents per share.

About 68 million vaccine doses have been delivered globally and sales in Europe of about $224m, emerging market sales of $43m and $8m in the rest of the world.

“This performance ensured another quarter of strong revenue and earnings progression, continued profitability, and cashflow generation, despite the pandemic's ongoing negative impact on the diagnosis and treatment of many conditions,” Mr Soriot said.

“Given the performance in the first quarter, in line with our expectations, we reiterate our full-year guidance. We expect the impact of Covid to reduce and anticipate a performance acceleration in the second half of 2021.”

Asked if he agreed that AstraZeneca had not overpromised, Irish Health Minister Stephen Donnelly told broadcaster RTE: "Not for a second. No, absolutely not."

"They made very clear commitments, they have failed to deliver on those commitments and that's one of the reasons Ireland has joined the EU Commission legal case," Mr Donnelly said.

Aside from the vaccine, the company said oncology sales rose 20 per cent year-on-year, while revenue was up 14 per cent from emerging markets, with a 19 per cent increase in China.

Nicholas Hyett, equity analyst at Hargreaves Lansdown, said the pandemic "has on the whole been bad news for AstraZeneca’s bottom line".

"Vaccine sales are boosting sales but a commitment to sell it at cost while the pandemic lasts means profits are unaffected," he said.

"However, a very strong pipeline in new and recently released oncology drugs has more than made up for the pandemic disruption and sales are moving along nicely."

The results come at the end of a difficult week for the company after the EU launched its legal action over delivery shortfalls that hampered the bloc's inoculation efforts.

The EU is suing AstraZeneca on the basis of breaches of an advanced purchase agreement, but the company says the legal action "without merit" and it will defend itself in court.

A dose of AstraZeneca vaccine is prepared at a vaccination centre in Kent in the UK. In Britain, under-30s can receive an alternative vaccine. Reuters

While AstraZeneca’s vaccine is approved for use in more than 100 countries, it has faced considerable controversy over links to blood clots in some patients.

On Thursday, Britain’s Medicines and Healthcare products Regulatory Agency reported another 41 reports of rare blood clots after doses of the drug were received, with a total of 209 clots with low blood platelet counts.

Scrutiny of the vaccine has found a higher incidence of blood clots among younger people with some countries, including the UK, recommending that only people over a certain age receive the drug. In the UK, under-30s can receive an alternative vaccine.

AstraZeneca said profit after tax jumped to $1.56bn in the three months to the end of March, compared with $780m a year earlier, with the company expecting higher sales in the second half of the year.

Meanwhile, Vaccitech, the biotech start-up that owns the technology behind the Covid-19 vaccine developed by Oxford-AstraZeneca, priced its ordinary shares at $17 each for its initial public offering on the Nasdaq on Friday under the ticket VACC.

The British company expects gross proceeds of $110.5m from the offering of 6.5 million of its American Depositary Shares after the company announced plans to go public earlier this month.

Its preference for a US listing to one in the UK is a blow for London's attempts to become a major financial hub, particularly after Brexit.

Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, highlighted strong investor demand for companies in this space.

“Although at present AstraZeneca is producing the vaccine at cost, once the pandemic has ended, the pharma giant and Vaccitech will benefit from future sales as batches are sold around the world," she said.

More on AstraZeneca

EU launches legal action against AstraZeneca over vaccine delays

Saudi Arabia denies reports of blood clots from AstraZeneca vaccine

One in a million: the truth about blood clots and Covid-19 vaccines