It's only just beginning; Shareholders are starting to come over to Ian Read's side.
AstraZeneca Sets Out Pfizer Defense -- Update
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Today : Tuesday 6 May 2014
By Hester Plumridge
LONDON--AstraZeneca PLC set out its defense against takeover interest from Pfizer Inc., issuing new financial targets and highlighting the potential value of its drugs in development, four days after turning down a bid worth more than $106 billion from the U.S. drugs giant.
AstraZeneca, which said Pfizer's offer "substantially" undervalued its business, said Tuesday it was aiming to generate revenue of more than $45 billion by 2023.
The company also highlighted the potential value of its pipeline of cancer, asthma and diabetes drugs in development, forecasting the new drugs to generate peak annual sales of between $23 billion to $63 billion, depending on the proportion of its new drugs that might receive regulatory approval.
The company also set out new revenue targets for its five key growth areas by 2023: including annual revenues of $3.5 billion from its blood-thinning pill Brilinta; $8 billion in annual sales from its portfolio of diabetes drugs; $8 billion in respiratory drug sales; mid to high single digit revenue growth in emerging markets and low single digit revenue growth in Japan.
AstraZeneca is facing flat or declining revenues in coming years, as its best-selling drugs lose patent protection, but Chief Executive Pascal Soriot has focused on rebuilding the company's pipeline and returning it to growth.
Pfizer has been pursuing its British rival since November, but AstraZeneca has rejected the advances. Last week, AstraZeneca said Pfizer's most recent cash and stock proposal valued at GBP50, or $84, a share "substantially" undervalued the company.
AstraZeneca's announcement Tuesday comes a day after Pfizer sought to increase pressure on the British company to enter talks on creating the world's biggest pharmaceutical company. Pfizer also reported declining quarterly results that underscored why it is interested in a tie-up.
In an interview on Monday, Pfizer's Chief Executive Ian Read said the offer was "compelling" and urged the U.K.-based company to enter talks.
"I'm hoping they will come back into discussions, but we are reviewing our options," he said.
Mr. Read agreed that Pfizer's options include walking away from a potential deal and even looking for a different one, though he argued that a combination would benefit both companies and their shareholders.
He added that his talks with AstraZeneca shareholders suggest they are open to doing a deal and want to discuss the terms further.
