* David Brennan to retire early on June 1
* CFO Simon Lowth to take over on interim basis
* First-quarter earnings fall underscores pressure on group
By Ben Hirschler
LONDON, April 26 (Reuters) – AstraZeneca Chief
Executive David Brennan is to step down on June 1 in an abrupt
exit that follows rising investor discontent at the company’s
performance.
Underlying earnings fell 19 percent in the first quarter,
underscoring the drug company’s need to find new sources of
growth as key products lose patent protection.
Britain’s second-biggest drugmaker has recently stepped up
its pace of deal-making, to bring in more promising new drugs
from other companies, but Brennan has been under fire from some
investors for not acting sooner.
Brennan will be replaced on an interim basis by Chief
Financial Officer Simon Lowth while a permanent successor from
inside or outside the company is found, AstraZeneca said on
Thursday.
At the same time, Leif Johansson will succeed Louis
Schweitzer as non-executive chairman on June 1 – three months
earlier than planned – and will become chairman of the
nomination and governance committee after the annual meeting
later on Thursday.
That will put the former Volvo boss in pole position to
select a replacement for Brennan.
AstraZeneca faces a slump in sales, following the loss of
patent cover on antipsychotic Seroquel last month, while
heartburn pill Nexium and its top-selling heart drug Crestor
lose U.S. protection in 2014 and 2016, respectively.
It has few new drugs in development to replace these big
sellers and its problems mean it trades on only around seven
times this year’s expected earnings, the lowest multiple for any
major international drug company.
Although the main hit from the loss of Seroquel is yet to
come, group sales already fell 11 percent in the first three
months, weighed down by a tough year-ago comparison and generic
competition for Nexium and other drugs in Europe.
Sales in the quarter were $7.35 billion, generating “core”
earnings, which exclude certain items, down 19 percent at $1.81
a share.
Analysts, on average, had forecast sales in the quarter of
$7.92 billion and earnings of $1.79 per share, according to
Thomson Reuters I/B/E/S.
AstraZeneca cut its forecast for full-year core earnings to
between $5.85 and $6.15 a share from $6.00-$6.30 previously and
against $7.28 in 2011.
