AstraZeneca Writes Off $140 Million Following Product Trial
LONDON -- The shares of AstraZeneca added 6 pence to 3,359 pence during early London trade this morning after the company said it will write off $140 million following the outcome of a product trial.
The FTSE 100 member confirmed the charge related to the development of fostamatinib, an oral treatment for rheumatoid arthritis, and would be taken in the second quarter.
AstraZeneca said the results from a phase 3 test program, alongside data reported previously from earlier trials, had prompted the company not to proceed with regulatory filings for the product.
The blue chip also claimed that hypertension, diarrhea, nausea, headache, and nasopharyngitis were among the treatment's most commonly reported side effects.
AstraZeneca said it would now return the rights for fostamatinib to Rigel Pharmaceuticals.
Briggs Morrison, managing director, executive vice president of global medicines development and chief medical officer at AstraZeneca, said:
The results of the late stage trials did not measure up to the promising results we saw earlier in development. We remain committed to the search for new treatments for patients with rheumatic and inflammatory diseases with phase 2 compounds in rheumatoid arthritis and lupus and phase 3 compounds in gout and psoriasis.
AstraZeneca claimed the write-off would not affect its financial guidance for 2013, whereby revenues are predicted to fall between 5% and 10% and profits are projected to drop "significantly more."
However, a $2.80 -- or 185 pence -- per share dividend declared for 2012 currently supports a 5.5% yield.
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