AstraZeneca (AZN) recently announced that the company has created seven positions in the senior executive team. At the same time, two senior roles were discontinued.
We note that three of the seven newly created positions are aimed at the discovery and development of candidates (including small molecules and biologics). The other three positions were created with region-wise (North America, Europe and International) focus. A position for management of global portfolio and product strategy was also created.
The two positions, which were terminated, were President of Research and Development, and Executive Vice President, Global Commercial.
We remind investors that last year Pascal Soriot was recruited as the Chief Executive Officer (CEO) of AstraZeneca. He is heading the company since Sep 1, 2012.
We believe that the leadership change will benefit AstraZeneca. It reflects the company’s efforts to advance and boost its pipeline with increased focus on research and development.
We remain concerned about the generic competition that AstraZeneca is currently facing or expects to face for its various drugs. This has put significant pressure on the company. Additionally, there is increasing uncertainty regarding the company’s key drug Crestor (cholesterol management) due to the entry of generic versions of Pfizer’s (PFE) Lipitor in Nov 2011. The company’s much hyped antiplatelet, Brilinta’s performance has remained lukewarm.
AstraZeneca is looking to combat the generic threat through deals and acquisitions. The Ardelyx and Isis Pharma agreements, Ardea acquisition, the collaboration with Amgen (AMGN) and the expansion of the diabetes alliance with Bristol-Myers Squibb (BMY) represent efforts in that direction.
We currently have a Neutral recommendation on AstraZeneca. The stock carries a Zacks Rank #3 (Hold) in the short run.
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