) successfully conducted a global bond market transaction, thereby
issuing notes worth $2 billion. AstraZeneca intends to utilize the
proceeds from the transaction for general corporate purposes
and refinancing debt . The global bond issue is registered with the
Securities and Exchange Commission (SEC).
The offering includes two tranches of $1 billion each -- a
7-year fixed rate notes with a coupon of 1.95% and 30-year fixed
rate notes with a coupon of 4%. AstraZeneca further stated that the
notes will be issued under its existing automatic shelf
registration statement on Form F-3.
The registration statement, which provides for the offer and
sale of an indeterminate amount of the debt securities at
AstraZeneca, was filed with the SEC on December 21, 2010. Moreover,
the statement is inclusive of a detailed prospectus for the benefit
Apart from the global bond issue, AstraZeneca was also in the
news recently when its global biologics division MedImmune joined
forces with WuXi AppTech, a subsidiary of China-based
WuXi PharmaTech Inc.
) to develop and commercialize MEDI5117 in China. MEDI5117 is being
developed for autoimmune and inflammatory diseases such as
With factors like pricing pressure in the EU and increasing
generic competition affecting sales in large pharmaceutical
markets, emerging markets have become an area of focus for several
companies. AstraZeneca strengthened its presence in China through
the acquisition of privately-held generics manufacturing company,
BeiKang Pharmaceutical Company Ltd. The collaboration with WuXi
further emphasizes AstraZeneca's strategy.
We are encouraged by AstraZeneca's focus on the high-potential
emerging markets and are pleased with its effort to drive the
bottom line through cost-cutting initiatives and share
However, we remain concerned about the generic competition faced
by the company's key products. In 2011, the company lost revenues
worth almost $2 billion to generic competition. The weak late-stage
pipeline at AstraZeneca coupled with slow Brilinta uptake also
We currently have a Neutral recommendation on AstraZeneca. The
stock carries a Zacks #3 Rank (Hold rating) in the short run.
ASTRAZENECA PLC (AZN): Free Stock Analysis
WUXI PHARMATECH (WX): Free Stock Analysis
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