Thinking Citizen Blog — Big Pharma VII: AstraZeneca (AZN) Oncology, Cardiovascular, Respiratory, and Immunology

Thinking Citizen Blog — Tuesday is Economics, Finance, and Business Day

Today’s Topic — Big Pharma VII: AstraZeneca (AZN) Oncology, Cardiovascular, Respiratory, and Immunology

This is the seventh in a series that began on 11/30 with a note on Vertex, followed by Pfizer (12/7). Johnson and Johnson (12/14) Roche (12/21), Merck (1/11/22) and ABBV (1/18/22). The thread tying all these posts together is the theme that for all the thorny regulatory issues related to drug safety and pricing, the most important thing to understand about the industry is that these companies are in the business of coming up with smaller, faster, cheaper, better ways of reducing human suffering and increasing human pleasure and have come a very, very long way since their founding. If there is a more noble business mission, please enlighten me. Experts — please chime in. Correct, elaborate, elucidate.

A LITTLE BIT OF A COMPLICATED HISTORY — Sweden, the UK

1. AstraZeneca is the product of the 1999 merger of the Swedish company Astra (founded in 1913) and the UK company Zeneca (1993).

2. Astra was originally founded to compete with the Swiss and German giants that dominated the Swedish market at the turn of the 20th century.

3. Zeneca was formed in 1993 as a spin-off from the UK chemical behemoth Imperial Chemical Industries (ICI) which had been established in 1926 by the merger of four UK chemical companies to more effectively compete with American and German chemical giants Dupont and IG Farben.

NB: The current market capitalization is $176 billion, making it the ninth largest drug company in the world by this metric — the largest being Johnson and Johnson at $429 billion, Roche second at $331 billion, and Pfizer third at $289 billion. Parenthetically, while the company’s origins are Swedish and British, the CEO is Pascal Soriot, a Frenchman. Top managements of drug companies tend to be very international. Also noteworthy is that 46% of Astrazeneca’s executives are women.

PRODUCT PORTFOLIO (percentage of revenues). Total Revenues (2020): $26.7 billion

1. Oncology: $10.8 billion (42%)

2. Cardiovascular $7.1 billion (27%)

3. Respiratory and Immunology: $5.4 billion (21%),

NB: Other $2.6 billion (10%)

GEOGRAPHIC SPLIT OF REVENUES

1. Emerging markets: $8.7 billion (34%)

2. US: $8.6 billion (33%)

3. Europe: $5.1 billion (20%)

NB: “Established rest of the world” $3.5 billion (10%)

AstraZeneca — Wikipedia

Annual Reports