# AstraZeneca PLC (AZN): Narrative, H1 / Q2 2026

AstraZeneca reports in US dollars. Every amount below is in US dollars as the company reports it, except one euro-denominated bond issue. That issue is converted to US dollars at the exchange rate on its pricing date, and the original euro amount is shown alongside. Growth rates are at actual exchange rates unless marked "CER", which is AstraZeneca's constant-exchange-rate measure.

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## Business

*Source: 2025 Form 20-F (fiscal year ended 31 December 2025), accession 0001104659-26-019130; company description from Form 6-K, accession 0001654954-26-008615.*

AstraZeneca is a global biopharmaceutical company. It discovers, develops, manufactures and sells prescription medicines, mostly patent-protected, in three groups: **Oncology**, **Rare Disease** (the Alexion business), and **BioPharmaceuticals**. BioPharmaceuticals covers Cardiovascular, Renal & Metabolism (CVRM), Respiratory & Immunology (R&I), and vaccines and infectious-disease medicines. The medicines are sold in more than 125 countries. AstraZeneca reports a single operating segment. Its Senior Executive Team runs discovery, development, manufacturing and commercial work as one integrated pharmaceutical business and reviews results for the Group as a whole, not by product.

Total Revenue was $58,739 million in 2025, up from $54,073 million in 2024. It has three parts:

- **Product Sales** ($55,573 million in 2025): sales of the company's own medicines to wholesalers, hospitals and government buyers. In the US these are recorded net of large rebate and chargeback accruals. Gross-to-net adjustments on US Product Sales came to $23,941 million in 2025, against $18,986 million in 2024.
- **Alliance Revenue** ($3,067 million): AstraZeneca's share of profits and royalties where a partner books the sales. The main sources are Enhertu with Daiichi Sankyo ($1,798 million), Tezspire with Amgen ($673 million), Beyfortus with Sanofi ($422 million) and Datroway with Daiichi Sankyo ($77 million).
- **Collaboration Revenue** ($99 million): milestones and licence fees. This line is lumpy. It was $923 million in 2024, when it included a $600 million Lynparza sales milestone.

**By therapy area**, 2025 Product Sales were:

- Oncology: $23,698 million. Main products: Tagrisso $7,254m, Imfinzi $6,063m, Calquence $3,518m, Lynparza $3,279m, Zoladex $1,106m, Enhertu $977m, Truqap $728m.
- CVRM: $12,764 million. Farxiga ($8,400m) is the company's largest product.
- Rare Disease: $9,126 million. Ultomiris $4,718m, Soliris $1,837m, Strensiq $1,678m, Koselugo $662m.
- R&I: $8,167 million. Symbicort $2,885m, Fasenra $1,981m, Breztri $1,199m, Saphnelo $686m, Tezspire $458m.
- Vaccines & Immune Therapies: $846 million.
- Other medicines: $972 million.

From 2026 the company reports vaccine and antiviral products as "Infectious Disease".

**By region**, 2025 Product Sales were:

- **US:** $23,444 million, up 8%.
- **Emerging Markets:** $15,056 million, up 11%. China accounted for $6,624 million, or 12% of Group Product Sales.
- **Europe:** $12,021 million, up 11%.
- **Established Rest of World:** $5,052 million. Japan accounted for $3,602 million.

**Patents and pipeline.** Most of the revenue depends on patent protection. AstraZeneca's patent-expiry table (as at 10 February 2026) shows US protection on Farxiga starting to expire from 2026, and protection on Imjudo in China and the EU in 2026. Brilinta lost US and EU exclusivity in 2025. Under settlements, biosimilar Soliris could enter the US market from 1 March 2025 and the EU from November 2025. Crestor, Nexium, Pulmicort, Seloken, Synagis and Zoladex have already lost patent protection in all major markets.

To offset these losses, the company relies on a large late-stage pipeline. It includes:

- antibody-drug conjugates (ADCs) such as Datroway, sonesitatug vedotin and puxitatug samrotecan;
- bispecific antibodies (volrustomig, rilvegostomig);
- camizestrant, now sold as Etcamah;
- baxdrostat, now sold as Baxfendy;
- oral GLP-1 and obesity candidates;
- cell therapies.

It also brings in assets through licensing and acquisitions. In 2025 it acquired FibroGen China for a total consideration of $221 million, which gave it all China rights to roxadustat. In 2024 it bought Gracell ($1,037 million) and Fusion Pharmaceuticals ($2,195 million).

**Listing and capital structure.** On 2 February 2026 AstraZeneca ended its American Depositary Receipt programme and listed its ordinary shares directly on the New York Stock Exchange. Per-share figures in this document are per ordinary share of $0.25 nominal value. At 31 December 2025 there were 1,550,907,927 ordinary shares in issue. The company also lists on the London Stock Exchange and Nasdaq Stockholm. PricewaterhouseCoopers audited the 2025 accounts and leaves at the 2026 Annual General Meeting. KPMG reviewed the H1 2026 interim statements.

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## Risk factors

*Source: 2025 Form 20-F, Item 3.D, accession 0001104659-26-019130. The H1 2026 report (Form 6-K, accession 0001104659-26-086846) states that these principal risks are not expected to change in the second half of 2026.*

- **Pipeline and launch execution.** Growth depends on new medicines replacing ones that lose exclusivity. Trials can fail at any stage, and launches can slip. In immuno-oncology, speed to market is critical because competitors run many trials. Competition for assets can also force AstraZeneca to pay well above book value for acquisitions and to make milestone payments with no assurance of recovering them.
- **Pricing and market access.** Governments are increasing cost-containment. The risk factors name the US Inflation Reduction Act, the EU Joint Clinical Assessment and international price-equalisation initiatives. In China, volume-based procurement (VBP) cut Farxiga, Lynparza and roxadustat sales in H1 2026. US Product Sales depend on rebate and chargeback estimates for Managed Care, Medicaid and Medicare Part D, which the auditor treated as a critical audit matter.
- **Loss of exclusivity and IP challenges.** Generic and biosimilar challengers routinely attack the company's patents, and governments are pushing faster generic uptake and compulsory licensing. Current examples are generic Farxiga in the US (Q2 2026), the UK and Japan; challenges to Forxiga patents in France, Portugal and Poland; challenges to Lynparza patents in the US and Canada; and a compulsory-licence fight over Tagrisso in Russia.
- **Supply and manufacturing.** Quality failures, regulatory action such as nitrosamine limits, or the loss of a hard-to-replace third-party supplier could cause shortages, recalls or plant shutdowns.
- **Information technology, cybersecurity and AI.** The company relies heavily on IT systems and sensitive data, including clinical, genomic and personal data. It faces sophisticated attacks, including attacks that use AI, and a fast-changing set of AI and privacy rules. It also says its own large AI investments may not pay off.
- **Litigation and investigations.** Product liability, patent, antitrust and sales-practice cases, especially in the US, can bring large awards. Live US matters include 340B antitrust and qui tam cases and the Syntimmune milestone dispute. Anti-bribery and anti-fraud enforcement in the UK and US is a separate exposure.
- **Geopolitics and macroeconomics.** AstraZeneca is active in more than 80 countries. Tariffs, trade controls, sanctions or recession could raise costs or cut demand, and governments under budget pressure may push prices down further.
- **Financial position.** Exchange rates move reported results. The main currencies are the US dollar, euro, Chinese renminbi, pound sterling, Japanese yen and Swedish krona. The balance sheet carries large intangible assets and goodwill, and the company expects some of them to be impaired in future. It also carries UK and Swedish defined-benefit pension obligations and is exposed to tax disputes between jurisdictions.
- **Strategy and targets.** The company's public targets depend on its assumptions and judgements, on developing commercially viable new products and on integrating acquired businesses. That includes its ambition of $80 billion in Total Revenue in 2030, which management says already allows for both trial successes and setbacks.

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## Management's discussion: fiscal 2025

*Source: 2025 Form 20-F, accession 0001104659-26-019130. Figures come from the audited Consolidated Statement of Comprehensive Income, the Statement of Cash Flows and Notes 2, 3, 25 and 27, plus the Item 4 Geographical Review.*

**Revenue.** Total Revenue grew 9% to $58,739 million and Product Sales grew 9% (9% at CER) to $55,573 million. The company says all its therapy areas performed strongly.

- **Oncology** Product Sales rose to $23,698 million from $20,275 million. Imfinzi grew to $6,063 million, with US sales up 35% on new launches. Tagrisso reached $7,254 million and Enhertu Product Sales $977 million. In China, Enhertu sales grew after it was added to the national reimbursement list (NRDL) on 1 January 2025.
- **Rare Disease** sales rose to $9,126 million. Patients moving from Soliris to Ultomiris lifted Ultomiris to $4,718 million, while Soliris fell to $1,837 million under biosimilar and gMG/PNH competition.
- **CVRM** edged up to $12,764 million. Farxiga grew to $8,400 million, driven by Emerging Markets and Europe. Brilinta fell to $823 million after generic entry in the US and Europe.
- **R&I** grew to $8,167 million, led by Fasenra, Breztri, Saphnelo, Tezspire and Airsupra.
- **Alliance Revenue** rose to $3,067 million from $2,212 million. **Collaboration Revenue** fell to $99 million from $923 million because the 2024 milestones did not recur.

By region:

- **US:** up 8%, with Oncology up 18% to $11,187 million.
- **Emerging Markets:** up 11% (13% at CER). Excluding China, growth was 18%; China itself grew 3%.
- **Europe:** up 11% (7% at CER).
- **Established Rest of World:** up 3%.

**Costs and profit.**

- Gross profit was $48,106 million and Cost of sales $10,633 million.
- R&D expense rose to $14,232 million from $13,583 million.
- SG&A was flat at $19,933 million.
- Operating profit rose to $13,743 million from $10,003 million, on higher revenue and much lower impairment and restructuring charges. Net intangible-asset impairments fell to $230 million from $1,574 million. Restructuring charges fell to $237 million from $1,154 million; the 2025 figure is net of a $138 million credit to Cost of sales, mainly reversing Andexxa inventory provisions taken in 2024. Most restructuring costs belong to the post-Alexion integration programme, which has cost $3,414 million in total.
- Legal charges in SG&A were $218 million.
- Profit for the year was $10,233 million, up from $7,041 million. Basic EPS was $6.60, against $4.54.

**Cash and capital allocation.**

- Net cash from operating activities was $14,575 million, against $11,861 million.
- Purchases of property, plant and equipment rose to $2,810 million from $1,924 million, and purchases of intangible assets were $3,095 million.
- Contingent-consideration payments on past acquisitions were $1,164 million.
- Dividends declared and paid in the year totalled $4,846 million, or $3.13 per share: a $2.10 second interim for 2024 and a $1.03 first interim for 2025.
- At year-end the Group had $10.6 billion of financial resources: $5.7 billion of cash and $4.9 billion of undrawn committed bank facilities, which have no financial covenants. Borrowings due within one year were $3.5 billion.
- The audited Note 32 reported no material subsequent events after 31 December 2025.

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## Current period: H1 and Q2 2026 (ended 30 June 2026)

*Source: H1 and Q2 2026 results, Form 6-K filed 27 July 2026, accession 0001104659-26-086846.*

**Headline results.** The company describes the period as continued "growth momentum".

| | H1 2026 | Change (actual / CER) | Q2 2026 | Change (actual / CER) |
|---|---|---|---|---|
| Total Revenue | $30,672m | +9% / +6% | $15,384m | +6% / +5% |
| Product Sales | $28,896m | +8% / +5% | $14,510m | +5% / +4% |
| Alliance Revenue | $1,699m | +31% / +29% | $874m | +34% / +33% |
| Reported EPS | $3.60 | +4% / +3% | $1.61 | +2% / -2% |
| Core EPS | $5.21 | +12% / +11% | $2.63 | +21% / +18% |

**What drove revenue.** Oncology grew at double digits. Its Product Revenue rose 18% to $14,123 million in H1, or 46% of the total:

- Imfinzi: $3,548m, up 31%, on new GI and GU launches (MATTERHORN, NIAGARA).
- Enhertu: $1,719m, up 36%.
- Calquence: $1,944m, up 19%.
- Truqap: $431m, up 43%.
- Datroway: $98m.

Rare Disease rose 13% to $4,911 million, with Strensiq up 41% and Ultomiris up 16%. R&I rose 12%, with Tezspire up 43%.

CVRM moved the other way. Its Total Revenue fell 8% (12% at CER) to $6,089 million, and in Q2 alone it fell 15%. Farxiga Total Revenue fell 6% to $4,042 million: several US generics launched in Q2 2026, US sales fell 17%, and VBP took effect in China in Q1 2026. Brilinta fell 64% and roxadustat 63%.

China revenue was flat in H1 and fell 7% in Q2 (13% at CER). Emerging Markets outside China grew 15%.

**Margins and costs in Q2.**

- Gross margin was 84% in Q2, up 1 percentage point. For the half, the company says geographic mix helped, while partner profit-sharing, loss-of-exclusivity pricing and the US government agreement announced in 2025 held margin back.
- Reported R&D expense rose 14% to $4,053 million. It included $345 million of impairments on development-stage intangible assets. For the half, the company attributes the rise in R&D to late-stage trials started after positive readouts, investment in new platforms and technology, and projects added through business development.
- Reported SG&A rose 16% to $5,651 million, mainly to support launches.
- Reported Operating profit fell 10% to $3,164 million. Core Operating profit rose 12% to $5,158 million, a Core operating margin of 34%.
- The Q2 Reported tax rate fell to 10%, against 22% a year earlier, because deferred tax assets were adjusted after internal legal-entity changes.

**Cash flow and balance sheet (H1).**

- Net cash from operating activities fell to $6,224 million from $7,099 million. Working-capital outflows were larger, and cash tax paid rose to $2,051 million from $1,549 million.
- Net cash used in investing rose to $4,704 million, mainly because of higher purchases of intangible assets, including a $1,104 million upfront payment to CSPC Pharmaceuticals.
- Capital expenditure was $1,513 million, against $1,303 million.
- Net debt rose $3,538 million in six months to $26,912 million. Gross debt was $32,239 million, including $2,407 million of new commercial paper. In H1 the company issued $1,990 million of long-term loans and repaid $2,450 million.
- Financial resources were $9.8 billion: $4.9 billion of cash and $4.9 billion of undrawn committed facilities available until April 2031. Borrowings due within one year were $6.2 billion.
- Credit ratings were unchanged: Moody's A1/P-1 and S&P A+/A-1.

**Business development in the half.** The CSPC Pharmaceuticals collaboration closed on 14 April 2026. It covers four programmes built on CSPC's AI-driven peptide discovery platform and its once-monthly LiquidGel dosing technology. AstraZeneca paid $1.2 billion upfront, of which $1.1 billion was capitalised as an intangible asset. Up to $3.5 billion more could be paid as regulatory milestones, plus sales milestones and royalties.

**Pipeline in the period.** The company counts 30 approvals in major regions since its Q4 2025 results. Milestones it reported between 29 April and 26 July 2026 include:

- **US approvals:** Baxfendy (baxdrostat) for hypertension in May 2026, a first-in-class medicine. Also Datroway in first-line TNBC, Enhertu in early breast cancer (DESTINY-Breast05 and DESTINY-Breast11), Imfinzi in NMIBC (POTOMAC) and Truqap in PTEN-deficient mHSPC.
- **Other approvals:** Etcamah in the EU and Japan, and Fasenra in hypereosinophilic syndrome across the US, EU, Japan and China.
- **Positive Phase III results:** Imfinzi in VOLGA, Imfinzi in NILE (one of two primary endpoints met), and sonesitatug vedotin in CLARITY-Gastric01 (one of two primary endpoints met: overall survival in third and later-line treatment, with overall survival in second and later-line treatment also met as a key secondary endpoint; progression-free survival in second and later-line treatment showed a trend but did not reach statistical significance).
- **Phase III misses:** Imfinzi in EMERALD-2, Wainua in ATTR-CM (CARDIO-TTRansform) and Ultomiris in adult HSCT-TMA. The CEO said he was "disappointed by the CARDIO-TTRansform outcome" and kept the $80 billion revenue ambition, which he said already assumes some setbacks.
- **Obesity:** in Phase IIb, elecoglipron, an oral GLP-1, cut body weight by 10.5% at 26 weeks against 0.6% on placebo.

**Litigation developments.** These are disclosed through 26 July 2026.

- In May 2026 AstraZeneca agreed to pay $220 million to settle the University of Sheffield's dispute over a Lynparza patent licence.
- In July 2026 the US Federal Circuit affirmed that Wyeth's patents asserted against Tagrisso are invalid. The jury had awarded Wyeth $107.5 million in 2024.
- In the Syntimmune dispute, the Delaware court had earlier found a $130 million milestone was met and awarded $181 million in further damages. In May 2026 it awarded AstraZeneca $11.1 million on its own claim against the sellers. AstraZeneca intends to appeal the adverse decisions.
- In June 2026 AstraZeneca started an ICC arbitration against Sanofi over the Beyfortus collaboration, and Sanofi has counterclaimed.
- The Ninth Circuit revived the 340B qui tam suit in March 2026.
- The US Supreme Court declined in May 2026 to hear AstraZeneca's Inflation Reduction Act challenge.
- In July 2026 the long-running niraparib royalty dispute with GSK was settled.
- Farxiga and Xigduo XR product-liability claims are subject to an agreement in principle to settle for an immaterial amount.

**Guidance (reconfirmed, at CER).** For FY 2026 the company expects:

- Total Revenue up by a mid-to-high single-digit percentage.
- Core EPS up by a low double-digit percentage.
- A Core tax rate of 18–22%.
- If June 2026 exchange rates hold, a low single-digit positive currency effect on Total Revenue, with Core EPS growth broadly similar to growth at CER.

The company also intends to raise the FY 2026 annual dividend to $3.30 per share, with the first interim set at $1.06, up 3 cents. It expects 2026 capital expenditure on property, plant and equipment and software to be about a third above the $3,270 million spent in 2025, driven by manufacturing expansion. It plans to report 9M and Q3 2026 results on 30 October 2026.

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## Subsequent events

*These events took place after 30 June 2026. Sources: the H1 2026 Form 6-K (accession 0001104659-26-086846) for transactions agreed in July 2026, and the Form 6-Ks cited against each item below. The interim financial statements contain no separate subsequent-events note; the July 2026 litigation outcomes are covered under Litigation developments above.*

After the half-year, AstraZeneca kept buying into outside oncology and respiratory assets and raised new long-term debt. The three asset deals below carry $2.8 billion of upfront and equity payments, with up to $2.8 billion more in contingent milestones.

- **Zegfrovy (sunvozertinib), licensed from Dizal Pharmaceutical.** AstraZeneca agreed in July 2026 to take an exclusive worldwide licence and completed the deal on 1 September 2026 (6-K accession 0001654954-26-007986). It pays $600 million upfront, up to $900 million in development, regulatory and sales milestones, and tiered royalties. Zegfrovy is an oral EGFR inhibitor approved in the US and China for previously treated EGFR exon 20 insertion NSCLC, and the FDA has accepted a filing for first-line use. The company says the deal does not change its 2026 guidance.
- **TQC3721, licensed from Sino Biopharmaceutical.** In July 2026 AstraZeneca took an exclusive licence from Chia Tai Tianqing Pharmaceutical Group (CTTQ), a Sino Biopharmaceutical subsidiary, for TQC3721, a PDE3/4 inhibitor being developed for respiratory disease. Sino Biopharmaceutical is eligible for a $200 million upfront payment, up to $1.9 billion in development, regulatory and sales milestones, and tiered royalties of up to double-digit percentages. At announcement the deal was subject to closing conditions, including regulatory clearances.
- **$2 billion equity investment in Summit Therapeutics.** Announced on 29 September 2026 and completed on 5 October 2026 (6-K accessions 0001654954-26-008615 and 0001654954-26-008783). AstraZeneca bought about 109 thousand shares of newly issued preferred stock, convertible into Summit common stock at 1:1,000. That gives it rights to about 12.0% of Summit's common stock (about 10.6% fully diluted). Converting to common stock would need regulatory clearance. The investment supports clinical collaborations that pair Summit's PD-1/VEGF bispecific antibody, ivonescimab, with AstraZeneca ADCs: sonesitatug vedotin in GI cancers, and Datroway (together with Daiichi Sankyo) starting in first-line TNBC (6-K accession 0001654954-26-008760). In each collaboration the companies share trial costs and keep their own product rights.
- **€2.55 billion (about $2.97 billion) bond issue.** AstraZeneca Finance LLC priced the bonds on 24 August 2026, fully guaranteed by AstraZeneca PLC, and they were admitted to trading on 1 September 2026 (6-K accessions 0001654954-26-007840 and 0001654954-26-007992). There are four fixed-rate tranches, maturing between March 2030 and September 2038, with coupons from 3.402% to 4.169%. The proceeds are for general corporate purposes. The dollar amount is converted at the 24 August 2026 rate.

The pipeline news after the period was mixed. On the positive side:

- Phase III wins for Tagrisso plus Orpathys (SAFFRON and SANOVO), Enhertu (DESTINY-Lung04), Tezspire (CROSSING) and Imfinzi plus Imdelltra (DeLLphi-305).
- New approvals: Datroway and Enhertu in the EU, Etcamah's US accelerated approval, and Trixeo for asthma in the EU.

On the negative side, two programmes were set back. AstraZeneca stopped the volrustomig trial eVOLVE-Lung02, and Etcamah missed its primary endpoint in SERENA-4.

Wan Ling Martello joined the Board as a Non-Executive Director on 1 September 2026.