Is AstraZeneca's $80B Revenue by 2030 Unrealistic?

At the Investor Day 2024 event, AstraZeneca unveiled an ambitious strategy to almost double its revenue from $45.8 billion in 2023 to $80 billion by 2030, alongside plans to introduce 20 new medicines by the end of the decade. CEO Pascal Soriot characterized this period as a "new era of growth" for the UK-based pharmaceutical giant. He highlighted that their revenue targets would be achieved through their current portfolio and the new therapies, many of which have the potential to exceed $5 billion in peak year revenues.

Soriot justified the feasibility of this bold objective by pointing to AstraZeneca's history of meeting ambitious goals. He reminded investors that the company successfully reached its $45 billion revenue target set a decade ago, up from $22.1 billion in 2018. This historical performance underscores AstraZeneca's capability for sustained growth, a sentiment echoed by analysts from Zacks Equity Research. They noted the company's success with new product launches over recent years, which have performed well in the market.

However, skepticism remains. During an interview with CFO Aradhana Sarin on Bloomberg Television, anchor Guy Johnson pointed out that the projected 7% to 8% topline growth needed to reach the $80 billion target is not currently reflected in market expectations. Sarin acknowledged the ambitious nature of the goal but emphasized the company's diverse and robust portfolio, particularly in oncology. She highlighted that oncology constitutes around 40% of AstraZeneca's business and is expected to experience significant double-digit growth.

In a separate interview with CNBC, Sarin elaborated on AstraZeneca's oncology objectives, aiming to develop treatments that could address half of all cancers by 2030. She articulated a vision where chemotherapy is replaced by antibody-drug conjugates (ADCs) and radiation therapy by radiopharmaceuticals, asserting that the company already possesses the technology to initiate these changes. Sarin mentioned that some drugs intended to replace chemotherapy are already filed with the FDA.

Zacks Equity Research also noted AstraZeneca's efforts to enhance its oncology portfolio through label expansions of existing drugs and the development of new cancer treatments. One notable candidate is Dato-DXd, an ADC being co-developed with Daiichi Sankyo, currently under FDA review for treating nonsquamous non-small cell lung cancer and HR+ HER2- breast cancer.

Despite these long-term plans, analysts from Jefferies expressed a more cautious short-term outlook. In their note on Tuesday, they observed that 2024 has relatively few major pipeline catalysts for AstraZeneca. They predicted that the "much-needed" approval of Dato-DXd might not occur until late in the year, at best. Consequently, they issued a hold rating on the company's stock. While AstraZeneca's ambitious revenue projections heavily rely on a series of anticipated blockbuster cancer drugs, Jefferies pointed out that the company's research and development efforts outside oncology are being overlooked, potentially offering significant long-term opportunities.

The main question remains whether AstraZeneca can meet its ambitious revenue goals by 2030. While Soriot has previously met high expectations, the real challenge lies ahead in executing this bold plan.

How to obtain the latest research advancements in the field of biopharmaceuticals?

In the Synapse database, you can keep abreast of the latest research and development advances in drugs, targets, indications, organizations, etc., anywhere and anytime, on a daily or weekly basis. Click on the image below to embark on a brand new journey of drug discovery!