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Photographer: Simon Dawson/Bloomberg

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AstraZeneca Says Coronavirus Outbreak to Hit Results

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AstraZeneca Says Coronavirus Outbreak to Hit Results

  • Drugmaker gets about a fifth of its revenue from China
  • Pascal Soriot said outbreak has caused “limited disruption”
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Photographer: Simon Dawson/Bloomberg

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AstraZeneca Plc signaled that a long-awaited profit rebound will be dented by the impact of the coronavirus epidemic spreading in China, one of the U.K. drugmaker’s key markets.

Depending on the epidemic’s extent, earnings are expected to increase by a mid- to high-teens percentage, AstraZeneca said Friday. Analysts had expected earnings to rise to $4.24 a share, an increase about 21% from 2019’s result. The shares fell as much as 6.3% and then rebounded after Chief Executive Officer Pascal Soriot said he doesn’t expect to see any sustained impact from the coronavirus on the company.

“So far we’ve had relatively limited disruption to our activities,” Soriot said on a call with reporters, adding that the company also rode out the 2009 flu pandemic with little impact. “We’ll get past this epidemic and China will remain a very important part of our company.”

Soriot has made China a focus, accelerating research and investment in new drugs there and lending a hand to a traditional Chinese medicine. The coronavirus epidemic, which first came to light in late December, has begun roiling markets as countries cut off travel to China, hurting industries from luxury goods to cars. Around 64,000 people have contracted the virus and nearly 1,400 have died.

Soriot said both of its Chinese sites are open after extending the New Year holiday period by another week. One is running at 85% capacity but will return to 100% next week, he said, and there has been “minimal” impact to clinical trials, bar one local Chinese trial.

The company’s fourth-quarter earnings missed analysts’ estimates by 9 cents a share, with sales of key cancer drugs such as Tagrisso and Lynparza coming in below projections. The company has nine blockbuster drugs and said there are “more to come.”

The drugmaker said its forecast assumes that the impact of the coronavirus will last several months.

Soriot was also asked about his succession on the call, having held the role since 2012. He said there’s a sub-committee looking at succession planning and it’s a regular topic of discussion but he doesn’t “plan to retire in the next few months.”

(Updates with comments from call from first paragraph)