AstraZeneca plc (LSE: AZN, OMX: AZN) is a British-Swedish multinational pharmaceutical and biologics company headquartered in London, United Kingdom. It is the world's fifth-largest pharmaceutical company measured by 2009 prescription drug sales (after Pfizer, Novartis, Sanofi and GlaxoSmithKline) and has operations in over 100 countries. It has a portfolio of products for major disease areas including cancer, cardiovascular, gastrointestinal, infection, neuroscience, respiratory and inflammation. The company was founded in 1999 through the merger of the Sweden-based Astra AB and the UK-based Zeneca Group. 
 

AstraZeneca has a primary listing on the London Stock Exchange and is a constituent of the FTSE 100 Index. It had a market capitalisation of approximately £39.5 billion as of 23 December 2011, the 10th-largest of any company with a primary listing on the London Stock Exchange. It has secondary listings on the New York Stock Exchange and the OMX exchange.

 

History

Astra AB was founded in 1913 in Södertälje, Sweden by 400 doctors and apothecaries. In 1993 the British chemicals company ICI demerged its pharmaceuticals businesses and its agrochemicals and specialties businesses, to form Zeneca Group plc, and in 1999 Astra and Zeneca Group merged to form AstraZeneca plc. 
 

In 2005 the company announced that it had become a Diamond Member of the Pennsylvania Bio commerce organization. It also decided to acquire KuDOS Pharmaceuticals, a UK biotech company, for £120m and entered into an anti-cancer collaboration agreement with Astex.
 

In 2006, following a collaborative relationship begun in 2004, AstraZeneca acquired Cambridge Antibody Technology for £702 million. 
 

In February 2007 AstraZeneca agreed to buy Arrow Therapeutics, a company focused on the discovery and development of anti-viral therapies, for $150 million. 
 

AstraZeneca's pipeline, and 'patent cliff', was the subject of much speculation in April 2007 leading to pipeline-boosting collaboration and acquisition activities. A few days later AstraZeneca acquired American company MedImmune for about $15.2 billion; AstraZeneca subsequently consolidated all of its biologics operations into a dedicated biologics division known as 'MedImmune'. 
 

In 2011 AstraZeneca acquired Guangdong BeiKang Pharmaceutical Company, a Chinese generics business. 
 

In February 2012 AstraZeneca and Amgen announced collaboration on treatments for inflammatory diseases. Then in April 2012, AstraZeneca acquired Ardea Biosciences, another biotechnology company, for $1.26 billion. 
 

In June 2012 AstraZeneca and Bristol-Myers Squibb announced a two-stage deal for the joint acquisition of the biotechnology company Amylin Pharmaceuticals. It was agreed that Bristol-Myers Squibb would acquire Amylin for US$5.3 billion in cash and the assumption of $1.7 billion in debt, with AstraZeneca then paying US$3.4 billion in cash to Bristol-Myers Squibb, and Amylin being folded into an existing diabetes joint-venture between AstraZeneca and Bristol-Myers Squibb. 
 

Operations

AstraZeneca develops, manufactures and sells pharmaceutical and biotechnology products to treat disorders in the gastrointestinal, cardiac and vascular, neurological and psychiatric, infection, respiratory, pathological inflammation and oncology areas.
 

AstraZeneca has its corporate headquarters in London, United Kingdom and its research and development (R&D) headquarters are in Södertälje, Sweden. The company employs over 11,000 people at research facilities in the United Kingdom, United States, Sweden, France, Canada, India, China and Japan.
 

The company's largest single research and development site is at Alderley Park (a large country estate on the east side of the A34 road north of the Monk's Heath crossroads) in Cheshire, England. Around 4,500 staff are based at the site. 
 

The company has a major research and development presence in Sweden, with approximately 4,000 staff employed at research facilities in Mölndal and Södertälje. 
 

Products

AstraZeneca specialises in prescription medicines to fight disease in several therapeutic areas. The following is a list of key products found on the AstraZeneca website. Generic- drug names are given in parentheses following the brand name.
 

Senior management

The senior executive team is composed of David Brennan, Simon Lowth, John Patterson, Tony Zook, David Mott, Bruno Angelici, Lynn Tetrault and David Smith. As of 2008, Brennan is paid $1,574,144 for his role as chief executive officer. 
 

On 26 April 2012, it was announced that David Brennan was to retire early in the June of that year.
 

It was also announced that Leif Johansson will succeed Louis Schweitzer as Non-Executive Chairman on 1 June 2012 – three months earlier than previously announced – and will become Chairman of the Nomination and Governance Committee after (the 2012) Annual General Meeting.
 

Controversies

Seroquel: adverse effects and trial procedures

AstraZeneca has stated that the atypical-antipsychotic drug, Seroquel, is the subject of four class-action lawsuits in Canada. Also, in the U.S., there were multiple product-liability cases alleging personal injury, namely, that Seroquel caused people to develop diabetes.
 

The company has indicated its intention to seek approval for Seroquel to treat psychiatric conditions such as depression and general anxiety disorder. 
 

Note as well that scientific findings regarding a new sustained-release form of the drug were announced at a conference in Madrid, Spain, in March 2007. At the time the data regarding the new drug were discussed, the drug had not been approved for sale by any health regulatory body in any country. 
 

During 2005 and 2006 clinical trials were carried out to examine the possibilities of further development of Seroquel. Test persons were recruited from research centres in Russia, Ukraine, Poland, Bulgaria and India. As part of the trials half of the test persons were given a placebo and stopped their medication. As a result thirty-six test persons relapsed into illness. One test person committed suicide, possibly as a result of quitting his medication. AstraZeneca denied that the suicide was related to the testing procedures. Ethical concerns were raised over the issue of carrying out trials in less-developed countries because of lower requirements for getting trials approved and overall lower trial costs.
 

In 2008, 45% of the test persons in AstraZeneca medical trials came from Asia; Eastern- and Central Europe; and South America. The same year 13.5% of the total sales were made in these regions. In contrast 86% of total sales were made in Japan, North America and Western Europe. 
 

In April 2010 AstraZeneca settled a Qui Tam lawsuit brought by Stefan P. Kruszewski for $520 million to settle allegations that the company defrauded Medicare, Medcaid and other government-funded health care programs in connection with its marketing and promotional practices for the blockbuster atypical antipsycotic Seroquel. 
 

In March 2011, AstraZeneca settled a lawsuit in the United States totaling $68.5 million dollars to be divided up to 38 states. Claims were made against AstraZeneca that it promoted Seroquel's use in children and adolescents long before establishing that it was safe or effective for any use in this population. Furthermore, it was found that patients experienced very serious side effects, including weight gain, diabetes and heart problems. AstraZeneca has been caught in a number of lawsuits stemming from deceptive and unfair promotion of Seroquel, and this is not the first series of settlements. 
 

Late-stage trial failures

Recently, AstraZeneca has experienced a run of failures of drugs in late-stage clinical trials. These include Galida for diabetes, and Exanta to prevent thrombosis. Other drugs with late-failing trials include NXY-059 for acute ischemic stroke, Iressa for lung cancer, and AGI-1067 for prevention of atherosclerosis. With patents expiring on older drugs, this threatens future revenue growth.
 

MedImmune takeover

After this long run of failed late-stage clinical trials, on 19 June 2007 AstraZeneca completed the acquisition of vaccine maker MedImmune, paying $15.2 billion primarily for its drug-development pipeline. Analysts have criticised this take-over, claiming that AstraZeneca paid too much. AstraZeneca consolidated its biologics portfolio in MedImmune and Cambridge Antibody Technology (acquired in 2007). This biologics portfolio was then rebranded to create a dedicated, global biologics organisation known as 'MedImmune'. Amid allegations of broken promises over this consolidation, AstraZeneca presented the new MedImmune to investors on 7 December 2007. 
 

Nexium

The company's most successful medication is esomeprazole. When it is manufactured the result is a mixture of two mirror-imaged molecules, R and S. Both are converted to the same active molecule in the body. Two years before the omeprazole patent expired AstraZeneca patented S-omeprazole in pure form, pointing that since some people metabolise R-omeprazole slowly, pure S-omeprazole treatment would give higher dose efficiency and less interindividual variation. The company marketed Nexium, as it would a brand new drug. This practice is criticised because it maintains the profits of drug companies at the expense of patients and public healthcare systems. 
 

On 16 August 2007, Marcia Angell, former editor-in-chief of the New England Journal of Medicine and a lecturer in social medicine at the Harvard Medical School, alleged in Stern, a German language, weekly newsmagazine, that AstraZeneca's scientists had doctored their research on the drug's efficiency:
 

Instead of using presumably comparable doses [of each drug], the company's scientists used Nexium in higher dosages. They compared 20 and 40mg Nexium with 20mg Prilosec. With the cards having been marked in that way, Nexium looked like an improvement- which however was only small and shown in only two of the three studies.
 

Nexium is also alleged by the authors to be "the top of the list" of medications which are marketed by pharmaceutical companies directly to doctors, who receive gifts of money and/or goods when they prescribe the medication in question. As a reason for the company's behaviour, it is alleged that the German public healthcare system spends an additional $139.50 million at time of reporting--> per annum on Nexium as compared to using omeprazole, which however would be less profitable for the company as its patent protection has expired. 
 

Corporate sexual harassment

Confronted by allegations in a 13 May 1996, Business Week cover story, of widespread sexual harassment and other abuses, Astra USA Inc. suspended three top executives and launched an internal probe. 
 

Astra USA agreed to pay $10 million to settle a lawsuit brought by at least seventy-nine women and one man against the company. The suit accused Astra's former president and other executives of pressuring female employees for sex and replacing older workers with younger, more attractive women. 
 

Bildman fraud

On 4 February 1998, Astra USA sued Lars Bildman, its former president and chief executive officer, seeking $15 million for defrauding the company. The sum included $2.3 million in company funds he allegedly used to fix up three of his homes, plus money the company paid as the result of the EEOC investigation. Astra's lawsuit alleged Bildman sexually harassed and intimidated employees, used company funds for yachts and prostitutes, destroyed documents and records, and concocted "tales of conspiracy involving ex-KGB agents and competitors … in a last-ditch effort to distract attention from the real wrongdoer, Bildman himself." Bildman had already plead guilty in U.S. District Court for failing to report more than $1 million in income on his tax returns; in addition, several female co-workers filed personal sexual-harassment lawsuits.
 

Nobel Prize investigation 2008

In 2008, the award of the Nobel Prize in Medicine for cancer-related research on Human Papilloma Virus (HPV) by Harald zur Hausen was being looked into by the Swedish police anticorruption unit. The reason was that AstraZeneca, which has a stake in two lucrative HPV vaccines and thus stands to gain financially from the prize, had agreed to sponsor Nobel Media and Nobel Web. Investigations were focused on whether AstraZeneca could have exerted undue influence on the award. According to Times Online, two senior figures in the process that chose zur Hausen also had strong links with AstraZeneca. 
 

Transfer mispricing

In 2010, AstraZeneca agreed to pay £505m to settle UK tax dispute, relating to transfer mispricing