AstraZeneca doubles down on cardiometabolic future as Farxiga patent cliff looms

A diversified P&L meets a concentrated headwind

AstraZeneca walked investors through a set of 2025 numbers that were as notable for their breadth as for their headline growth. Revenue rose 8% at constant exchange rates, with product sales up 10% and core EPS advancing 11%, squarely in line with guidance. Yet threaded through the upbeat narrative was an explicit acknowledgment that 2026 will be a transition year, shaped by the loss of exclusivity for Farxiga in the US and value-based procurement in China.

CFO Aradhana Sarin framed the year as one of “very strong financial performance” underpinned by an 82% core gross margin and 9% operating profit growth. Alliance revenue grew 38%, reflecting richer profit shares from partnered oncology and respiratory assets such as Enhertu, Tezspire and Beyfortus. SG&A costs rose a modest 3%, falling to 26% of revenue from 28%, a reminder that AstraZeneca is still squeezing operating leverage out of an increasingly complex portfolio.

Cash generation was robust: operating cash flow jumped 23% to $14.6bn, even as capex climbed to $3.3bn. The company plans to raise capex by about a third in 2026 to fund new manufacturing capacity in the US, China and Singapore for ADCs and other biologics. Net debt sits at around $30bn, but leverage is a comfortable 1.2x EBITDA, leaving balance sheet room for selective business development rather than large‑scale M&A.

Against this financial backdrop, management proposed a second interim dividend of $2.17 per share, bringing the 2025 total to $3.20, and signalled an intended step-up to $3.30 in 2026, consistent with its “progressive” dividend policy.

Guidance for 2026 underlines the tension between near‑term headwinds and long‑term ambition. At constant exchange rates, AstraZeneca expects total revenue to grow by a mid‑ to high single‑digit percentage and core EPS by a low double‑digit percentage. The outlook explicitly bakes in China’s VBP cuts for Farxiga, Lynparza and roxadustat, and the April loss of Farxiga exclusivity in its largest market. Management also flagged a step‑up in net finance expense from higher leases and lower interest income.

Oncology: multi‑blockbuster scale and a third wave of IO

If AstraZeneca’s P&L is diversified, its growth engine is not in doubt. Oncology delivered $25.6bn of revenue in 2025, up 14% or 17% excluding a prior‑year Lynparza milestone. The division is now studded with multi‑blockbuster brands: Tagrisso above $7bn, Imfinzi beyond $6bn, Calquence over $3.5bn and AstraZeneca’s share of Enhertu above $2.5bn.

Fourth‑quarter oncology revenue topped $7bn for the first time, rising 20% ex‑Lynparza milestone, with all key medicines and regions in double‑digit growth. Tagrisso grew 10% on the back of broader combination use in first‑line EGFR‑mutant lung cancer and rising adoption of adjuvant (ADAURA) and unresectable Stage III (LAURA) regimens. Imfinzi and its CTLA‑4 partner Imjudo rose 37% and 26%, respectively, as newer indications such as small cell lung cancer (ADRIATIC) and bladder (NIAGARA) layered onto established liver cancer use.

Calquence advanced 17% in the quarter, consolidating class leadership in frontline CLL and gaining US market share, while Enhertu surged 46% as it captured share in HER2‑positive and HER2‑low metastatic breast cancer and benefited from NRDL‑driven acceleration in China. Datroway, the in‑house TROP2 ADC, posted $40m in Q4 revenue in late‑line EGFR‑mutant lung cancer with an emerging third‑line leadership position.

Looking into 2026, Oncology head Dave Fredrickson sketched a pipeline rich in near‑term catalysts that could sustain high‑teens growth. Imfinzi is poised for what R&D chief Susan Galbraith called a “third wave” of growth, with US approval already in early gastric cancer (MATTERHORN) and the bladder cancer POTOMAC trial expected to add another opportunity in the first half. A series of combination trials with Imjudo and Datroway in lung, liver and bladder cancer could seed further launches from 2027 if positive.

Enhertu is entering a new phase of life-cycle expansion. Three major readouts and approvals are expected in 2026: first‑line metastatic breast cancer (DESTINY‑Breast09) and early‑stage breast settings (DESTINY‑Breast11 and DB05). Beyond breast, AstraZeneca is already positioning the HER2 ADC in other tumours, including lung.

Calquence should gain fresh momentum from AMPLIFY, a finite‑therapy regimen in CLL that is awaiting imminent US approval and already cleared in Europe. In the US, where roughly half of CLL patients receive time‑limited therapy, AMPLIFY gives AstraZeneca a way to participate in that segment without ceding its leadership in treat‑to‑progression.

Tagrisso, meanwhile, is being fortified as a backbone therapy via combination studies. Beyond current FLAURA‑2 combinations in first‑line disease, the company is testing Datroway in TROPION‑Lung15 (post‑TKI EGFR‑mutant lung cancer) and plans to move into the first‑line setting with TROPION‑Lung14. Fredrickson characterised several 2026 oncology catalysts – notably AVANZAR (first‑line lung combinations with Datroway), EMERALD‑3 (local‑regional HCC) and SERENA‑4 (first‑line HR‑positive breast cancer with camizestrant plus CDK4/6) – as single or multi‑blockbuster opportunities on AstraZeneca’s share alone.

Underpinning this is a pipeline that now spans more than 100 Phase III studies across the company, 20 of which are expected to read out in 2026. Management estimates the combined peak‑year sales potential of the 16 positive Phase III readouts in 2025 at $10bn and sees a similar, slightly higher, risk‑adjusted contribution from each of 2026 and 2027, with a rising value per indication as projects are prioritised.

Biopharmaceuticals: a hinge year for CVRM as R&I accelerates

Outside oncology, AstraZeneca’s BioPharmaceuticals division – covering respiratory & immunology (R&I), cardiovascular, renal & metabolism (CVRM) and vaccines & immune therapies (V&I) – generated $23bn of revenue in 2025, up 5%. The aggregate conceals mix effects: R&I is in full stride, CVRM is about to absorb a major patent shock, and V&I is normalising after pandemic‑era milestones.

In the fourth quarter, R&I revenue rose 10%, with growth medicines up 27%. Tezspire, Fasenra, Breztri and Saphnelo are steadily reshaping the severe asthma and lupus markets. Fasenra has consolidated its position as the leading IL‑5 biologic in eosinophilic asthma and gained a new indication in EGPA; Chinese NRDL listing is expected to accelerate emerging‑market growth. Tezspire has rapidly climbed the severe asthma rankings and secured approval in chronic rhinosinusitis with nasal polyps, where it has demonstrated an ability to “nearly eliminate” the need for surgery – an important differentiator given the high overlap with asthma.

Breztri remains the fastest‑growing COPD inhaler and a clear market leader in China. Asthma regulatory reviews based on the KALOS and LOGOS trials are under way, with first approvals anticipated in the first half of 2026, potentially opening another large chronic indication. Saphnelo, already IV market leader in SLE in several major markets, is being extended with a subcutaneous formulation to reach patients favouring self‑administration; EU approval has been secured, with US and Japan decisions expected in the first half of 2026.

CVRM, by contrast, declined 6% in the quarter, as generic erosion of Brilinta and emerging pressure on Farxiga tempered growth. Full‑year Farxiga revenue still grew 2%, but 2026 will bring a more abrupt shift. In China, value‑based procurement will cut prices and volumes for Farxiga in the first quarter, alongside Lynparza and roxadustat. In the US, Farxiga’s patents expire in April; the product generated $1.7bn there in 2025, about 21% of global sales. Europe, which accounts for 35% of Farxiga revenue and is patent‑protected to 2028 in key markets, and emerging markets outside China are expected to remain growth engines.

CVRM head Ruud Dobber described 2026 as a “transition year” but insisted the franchise could absorb the shock. Lokelma is growing strongly as a leading potassium binder, with extra manufacturing capacity now online. Dapagliflozin‑based fixed‑dose combinations are in Phase III across kidney disease and heart failure, with first readouts in 2027, and AstraZeneca is preparing to launch baxdrostat for uncontrolled and treatment‑resistant hypertension, pending US approval.

Baxdrostat, a selective aldosterone synthase inhibitor, will initially be commercialised through AstraZeneca’s existing CVRM infrastructure, timed to coincide with US Farxiga generics. Ruud positioned the molecule as a “compelling” long‑term opportunity, with peak franchise revenue potential above $5bn once combinations – notably with dapagliflozin – come through.

Beyond that, the company is building out a next‑generation CVRM pipeline that it hopes will drive growth well into the 2030s. Oral PCSK9 inhibitor lorundostat (laropravastat) is scheduled for first Phase III reads in 2027 and is seen internally as a potential $5bn‑plus asset. Combinations of dapagliflozin with zibotentan for kidney disease and heart failure are guided to a $3–5bn peak range. And, if successful, tozorakimab – a differentiated IL‑33 biologic in three Phase III COPD trials – could, in Dobber’s words, be “a multibillion‑dollar opportunity” given the size and heterogeneity of the disease.

Head of BioPharma R&D Sharon Barr underscored the stakes around two 2026 readouts. CARDIO‑TTRansform, the largest ever trial in ATTR cardiomyopathy with more than 1,400 patients, will deliver outcomes data on Wainua (eplontersen) in the second half. Designed to capture cardiovascular mortality and recurrent clinical events, and to include both tafamidis‑naive patients and those on background stabiliser therapy, the trial is intended to set a new standard on top of existing stabilisers. Positive data could open the door to combinations with cliramitug, an anti‑amyloid antibody now in a Phase III DepleTTR study that completed enrolment a year ahead of plan.

Tozorakimab, due to report in the first half, is being tested in three trials – OBERON, TITANIA and MIRANDA – with a primary endpoint of reducing moderate‑to‑severe COPD exacerbations in former smokers, and broader analyses across eosinophil levels and smoking status. Barr stressed that tozorakimab’s ability to inhibit both ST2 and RAGE/EGFR pathways, thereby impacting mucus production and epithelial remodelling, could differentiate it from other IL‑33 agents in development.

Weight management: betting on the next wave, not the first

Perhaps the most symbolically significant disclosure for investors was AstraZeneca’s decision to move its oral GLP‑1 receptor agonist, elecoglipron (AZD5004), into Phase III after positive Phase IIb data in obesity (VISTA) and type 2 diabetes (SOLSTICE). Detailed data will be presented at the American Diabetes Association meeting in June, but CEO Pascal Soriot was explicit: the move to late‑stage development reflects confidence that elecoglipron’s monotherapy profile is competitive, not merely “modest” weight loss to be rescued by combinations.

The company’s weight‑management strategy rests on a few pillars. First, management sees cardiometabolic disease as “the biggest issue mankind is facing”, and argues that the apparent glut of GLP‑1 competitors masks the immaturity of the market, especially outside the US and Europe. AstraZeneca believes its established emerging‑markets footprint – honed via Farxiga – will be a critical advantage as payers and regulators outside rich countries begin to grapple with obesity.

Second, AstraZeneca is pursuing a diversified mechanism mix: oral GLP‑1; long‑acting injectables via a recent alliance with CSPC; a dual GLP‑1/glucagon agonist (AZD9550); and a selective amylin agonist (AZD6234), both entering Phase II this year. The emphasis, Ruud argued, will be on quality of weight loss – preserving lean muscle and targeting visceral fat – and on convenience, with a shift from weekly to monthly injectables.

Finally, the company envisages a foundational role for combination therapy. Soriot talked about GLP‑1 plus SGLT2 inhibitors as a logical base regimen for high‑risk patients, tackling weight, kidney and cardiac risk simultaneously. In this framing, AstraZeneca’s CVRM heritage – and its pipeline of oral agents and combinations – become a strategic counterweight to the crowded standalone obesity market.

Rare disease: Alexion scale and an amyloidosis bet

Five years after acquiring Alexion, AstraZeneca’s rare disease unit delivered $9.1bn of revenue in 2025, up 4% at CER, and has achieved low double‑digit compound annual growth since 2020. The integration story is now less about cost and more about reach and science.

Geographically, Alexion’s therapies were available in about 20 countries at acquisition; they are now present in more than 75, leveraging AstraZeneca’s infrastructure. Scientifically, CEO of Alexion and AstraZeneca’s rare disease head Marc Dunoyer highlighted more than 120 collaborative projects across the group, from shared work on transthyretin amyloidosis to dual CD19/BCMA CAR‑T programmes.

Ultomiris, the longer‑acting successor to Soliris, grew 15% in the fourth quarter, driven by neurology indications such as gMG and PNH, and is guided to peak‑year sales above $5bn. The transition from Soliris – itself now hit by biosimilars – is “close to being completed”. In 2026, high‑level data are expected in IgA nephropathy (with a 34‑week proteinuria endpoint that could support accelerated approval) and haematopoietic stem cell transplant‑associated TMA.

Strensiq, for hypophosphatasia, also grew 15% in the quarter, helped by tender timing. A trio of Phase III studies of efzimfotase alfa – one switching pediatric patients from Strensiq, one in treatment‑naive paediatric patients versus placebo, and a third in adolescents and adults – will read out in the first half of 2026. Dunoyer framed efzimfotase as an opportunity to move from burdensome daily or alternate‑day infusions to dosing every other week, with the potential to “multiply” Strensiq’s value if efficacy and safety hold across all age groups.

Koselugo continues to expand in paediatric NF1, supported by adult approvals in some markets. Overall, Dunoyer expects “another year of strong performance” in rare disease, fuelled by both demand and indication expansions.

Beyond complement, AstraZeneca is making a sizeable bet on amyloid depletion. Anselamimab, an antibody targeting kappa light‑chain amyloid, delivered positive Phase III CARES data in 2025, demonstrating reductions in all‑cause mortality and cardiovascular hospitalisation in a subgroup of AL amyloidosis patients. Regulatory submissions are under way. A December deal extended the Neurimmune alliance to NI009, a fibril‑depleting antibody targeting lambda light‑chain amyloid – around 80% of the light‑chain population – with an accelerated plan to reach the clinic.

In transthyretin disease, cliramitug has moved into Phase III ATTR cardiomyopathy (DepleTTR), where enrolment completed a year ahead of schedule with more than 1,000 patients. Management is already planning a Phase IIb combination of Wainua and cliramitug, aiming at a new standard of care based on both silencing and fibril depletion.

Geography and governance: China nuance, IR handover

If AstraZeneca’s product portfolio is broad, so too is its geographic spread. The US grew 10% in 2025; Europe rose 7%; China, despite losing Pulmicort to generics, managed 4% growth and remains the company’s largest national market. Emerging markets outside China were the standout, growing 22%.

China EVP Iskra Reic acknowledged that 2026 will be “a lot of moving parts”. VBP on Farxiga, Lynparza and roxadustat will bite through price cuts and volume losses, but AstraZeneca expects a mid‑term recovery for Farxiga driven by brand recognition and retail‑channel resilience, echoing earlier experiences with Betaloc and Crestor. New launches are set to offset some of the drag: Fasenra, Truqap and Calquence tablets entered the NRDL from January, and Enhertu’s rapid inclusion in more than 1,000 hospitals within a quarter of its NRDL listing is viewed internally as a template.

Profitability in China remains below group average, reflecting lower pricing, but management stressed the scale of unmet need and volume growth. In business development, Soriot noted that AstraZeneca’s R&D footprint and long‑standing relationships in China have allowed it to secure local deals even when rivals reportedly offered higher prices, though he also warned of rising competition and valuations for Chinese assets.

The presentation closed on a more personal note, with Soriot thanking long‑standing Head of Investor Relations Andrew Barnett, who is moving to a country president role in Japan, and introducing his successor, Joris Silon, previously US country president for Biopharma. It was an almost symbolic passing of the baton from a company that once depended heavily on a handful of mature blockbusters in advanced markets to one whose future will be forged in obesity clinics, cardiology wards and cancer centres across a much more complex global landscape.

For now, AstraZeneca’s message to investors is that it can navigate the Farxiga cliff with its existing growth franchises while investing heavily – and deliberately – in technologies and platforms intended to secure growth beyond 2030. Whether the mix of oral GLP‑1s, PCSK9s, ADCs, bispecifics and amyloid antibodies will be enough to meet its $80bn 2030 revenue ambition is still to be proven, but the company has rarely been more explicit about the bet it is making.