Slide 1: Year-To-Date and Q3 2016 Results
Year-To-Date and Q3 2016 Results Conference call and webcast for investors and analysts, Cambridge, UK 10 November 2016
Slide 2: Forward-looking statements
Forward-looking statements In order, among other things, to utilise the 'safe harbour' provisions of the US Private Securities Litigation Reform Act 1995, we are providing the following cautionary statement: This document contains certain forward-looking statements with respect to the operations,
Slide 3: Agenda
Agenda Overview Pascal Soriot Growth Platforms Mark Mallon Finance Marc Dunoyer Pipeline Sean Bohen Closing and Q&A Pascal Soriot 3
Slide 4: Q3 highlights
Q3 highlights Guidance unchanged;; pipeline-driven transformation continues Business & Financials Total Revenue reflects loss of Crestor exclusivity and quarterly US Symbicort impact/gross-to-net adjustments, lack of FluMist and one-off events in Emerging Markets ’New AstraZeneca’ grew 6% YTD •
Slide 5: Q3 highlights; continued
Q3 highlights;; continued Guidance unchanged;; pipeline-driven transformation continues Pipeline Oncology • Faslodex: Regulatory submission (JP) • Lynparza: Positive Phase III trial • Tagrisso: Regulatory submission, Priority Review (CN) • cediranib: Regulatory withdrawal (EU) • selumetinib: Negati
Slide 6: Total Revenue: Inflection point approaching
Total Revenue: Inflection point approaching New AstraZeneca is emerging from patent losses $bn 20 US patent losses 15 (Crestor/Nexium/Seroquel) Other out-of-patent medicines Externalisation (outside Emerging Markets) 10 Emerging Markets (established medicines) Respiratory 5 +6% YTD Oncology Brilin
Slide 7: Agenda
Agenda Overview Pascal Soriot Growth Platforms Mark Mallon Finance Marc Dunoyer Pipeline Sean Bohen Closing and Q&A Pascal Soriot 7
Slide 8: Growth Platforms: Robust despite soft Q3
Growth Platforms: Robust despite soft Q3 Increasing Oncology contribution;; Japan stable Q3 2016 % % Total YTD 2016 % % Total $m change Revenue $m change Revenue Growth Platforms 3,584 3 63 10,763 6 62 Emerging Markets 1,395 3 - 4,308 6 - Respiratory 1,110 (8) - 3,543 (2) - Diabetes 606 6 - 1,8
Slide 9: Growth Platforms: Robust despite soft Q3
Growth Platforms: Robust despite soft Q3 Increasing Oncology contribution;; Japan stable Q3 2016 % % Total YTD 2016 % % Total $m change Revenue $m change Revenue Growth Platforms 3,584 3 63 10,763 6 62 Emerging Markets 1,395 3 - 4,308 6 - Respiratory 1,110 (8) - 3,543 (2) - Diabetes 606 6 - 1,8
Slide 10: Emerging Markets
Emerging Markets China performing well;; softness in other markets Long-term target: Good fundamentals;; balanced performance Mid to high single-digit growth Emerging Markets • Balanced presence: China less than half of +12% +12% total. Russia +13%, Brazil +5% +8% 6% +4% 3% • Established medicines
Slide 11: Respiratory
Respiratory Symbicort continues as global leader in competitive market Q3 impacted by US true-ups Symbicort global leader and US, Europe competitive and managed-care access gains Europe volume has stabilised Emerging Markets growth Global market share volume $m US -11% -2% 3,500 40% 32% • Volume
Slide 12: Diabetes
Diabetes Global growth with focus on Farxiga Farxiga now largest AstraZeneca Farxiga global leader in Growth in all regions Diabetes medicine YTD SGLT2 class by volume $m 50% US +6% 2,000 42% • Growth market, but intense +13% 40% competition for market share • Farxiga +78% from improved 1,500 30% 27
Slide 13: Japan
Japan Performance recovered after the April price cuts Focus medicines: Q3 growth Focus medicines: Leading New medicines starting to despite biennial price cuts dynamic patient share transform Japanese business $m • Tagrisso launched in May;; 2,000 39% 2,400 patients treated -2% 33% 1,500 28% • Pro
Slide 14: Brilinta
Brilinta Solid growth continues Growth across Brilinta continued to Strong execution of all markets outgrow the market lifecycle management $m YTD volume growth US 600 +39% 60 • Lower quarterly growth reflecting 52% inventory increase Q3 2015 +88% • Positive momentum from changes to 45 competitor’s
Slide 15: New Oncology
New Oncology Launches progressing well Tagrisso Tagrisso Lynparza (lung cancer) New blood-based test approved (ovarian cancer) $m Global Product Sales $m Global Product Sales 300 150 200 100 100 50 0 0 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 YTD Q1 Q2 Q3 Q4 Q1 Q2 Q3 YTD YTD 2016 2015 2015 2015 2015
Slide 16: Agenda
Agenda Overview Pascal Soriot Growth Platforms Mark Mallon Finance Marc Dunoyer Pipeline Sean Bohen Closing and Q&A Pascal Soriot 16
Slide 17: Reported Profit & Loss
Reported Profit & Loss YTD 2016 % Total Q3 2016 % Total % change % change $m Revenue $m Revenue Total Revenue 17,417 (3) 5,699 (4) Product Sales 16,059 (6) 92 5,025 (14) 88 Externalisation Revenue 1,358 56 8 674 617 12 Gross Margin 82% +63bps - 82% -165bps - R&D Expense (4,347) 5 25 (1,402) 4 25
Slide 18: Core Profit & Loss
Core Profit & Loss Other Income weighted towards Q4 YTD 2016 % Total Q3 2016 % Total % change % change $m Revenue $m Revenue Total Revenue 17,417 (3) 5,699 (4) Product Sales 16,059 (6) 92 5,025 (14) 88 Externalisation Revenue 1,358 56 8 674 617 12 Gross Margin 83% -90bps - 84% -47bps - R&D Expen
Slide 19: Continued progress and focus on cost discipline
Continued progress and focus on cost discipline Decline in Core R&D costs from Q4 2015 as committed $bn 1.5 • Stable Core costs in Q3 2016 • Investment focused on a number of potential medicines in pivotal trials 1.0 Q4 14 Q3 15 Q3 16 Core SG&A cost reduction being steadily delivered • A 12% reducti
Slide 20: FY 2016 guidance and capital-allocation guidance
FY 2016 guidance and capital-allocation guidance Guidance Capital-allocation priorities Investment in Total Revenue the business Low to mid single-digit percentage decline Progressive dividend policy Strong, investment- grade credit rating Core EPS Low to mid single-digit percentage decline Ear
Slide 21: Agenda
Agenda Overview Pascal Soriot Growth Platforms Mark Mallon Finance Marc Dunoyer Pipeline Sean Bohen Closing and Q&A Pascal Soriot 21
Slide 22: Q3 late-stage pipeline highlights
Q3 late-stage pipeline highlights Main therapy areas Cardiovascular & Oncology Respiratory Metabolic Diseases • Faslodex - breast cancer (1st line): • Brilinta - CV disease: • benralizumab - severe, Regulatory submission (JP) -Regulatory approval (JP) uncontrolled asthma: 4th positive -Phase I
Slide 23: Tagrisso
Tagrisso Strong foundation for industry leadership in EGFRm NSCLC AURA3 data accepted at World Foundation for industry Tagrisso forthcoming news flow Conference on Lung Cancer (Dec.) leadership in EGFRm NSCLC Regulatory decisions H2 2017 China Earlier lines of EGFRm NSCLC Regulatory submissions Q4 2
Slide 24: ESMO 2016 take-away messages
ESMO1 2016 take-away messages Advancement in next-generation Oncology treatments Immuno-Oncology Durvalumab: Study 1108 (NSCLC cohort) show impressive monotherapy efficacy 1 Durva + next-gen IO2: Combinations with STAT3 / CXCR2 in HNSCC3, other solid tumours Next-gen IO: Activated OX40 promotes
Slide 25: Immuno-Oncology: AstraZeneca's path to market
Immuno-Oncology: AstraZeneca’s path to market Key Phase III data coming soon;; H1 2017 key to success = durvalumab = durva + treme ✔ = fully recruited Bladder cancer DANUBE 1st-line bladder MYSTIC 1st line (PFS) ✔ MYSTIC 1st line (OS) ✔ Lung cancer ARCTIC 3rd line PD-L1 neg.✔ PACIFIC ✔ Stage III
Slide 26: Diabetes franchise
Diabetes franchise Farxiga primary focus DURATION-8: Farxiga + Bydureon significantly DURATION-8: Farxiga + Bydureon significantly lowered blood sugar (A1C) at week 28 reduced weight from baseline at week 28 Two new Phase III outcomes trials announced: Chronic kidney disease (CKD) and chronic hear
Slide 27: Respiratory biologics
Respiratory biologics Benralizumab has best-in-disease potential Benralizumab: SIROCCO and CALIMA demonstrated Differentiated profile for severe, uncontrolled asthma sustained lung-function improvement • Reduced annual asthma exacerbation rates (up to 51%) • Reduced corticosteroid use (ZONDA;; 4t
Slide 28: Pipeline news flow in 2016 & 2017
Pipeline news flow in 2016 & 2017 Realising potential of new medicines Q4 2016 H1 2017 H2 2017 Regulatory decisions - Faslodex - breast cancer (1st line) (JP) Tagrisso - lung cancer (CN) saxa/dapa - type-2 diabetes (US) ZS-9 - hyperkalaemia (US, EU) brodalumab - psoriasis (US, EU) Regulatory
Slide 29: Agenda
Agenda Overview Pascal Soriot Growth Platforms Mark Mallon Finance Marc Dunoyer Pipeline Sean Bohen Closing and Q&A Pascal Soriot 29
Slide 30: Pipeline-driven transformation on track
Pipeline-driven transformation on track New AstraZeneca emerging from patent cliff • Financials on track;; unchanged guidance for the year • 13 new potential medicines in Phase III/under registration • Oncology progressing ahead of expectations – Tagrisso – Immuno-Oncology • Busy news flow over ne
Slide 31: Year-To-Date and Q3 2016 Results
Year-To-Date and Q3 2016 Results Conference call and webcast for investors and analysts, Cambridge, UK 10 November 2016