AstraZeneca share price underperforms after flu vaccine setback

Shares in AstraZeneca (LON:AZN) have been little changed in today’s session, underperforming the broader London market, after the Anglo-Swedish drugmaker disclosed that US health officials had decided not to use the group’s flu vaccine Flumist Quadrivalent. The decision will result in an $80-million hit for the blue-chip pharmco.

As of 08:29 BST, AstraZeneca’s share price had inched 0.03 percent higher to stand at 3,888.00p. The shares are underperforming the benchmark FTSE 100 index which has gained 0.55 percent to 6,295.63 points amid expectations that the UK will vote to remain in the European Union in today’s referendum. The pharmco’s shares have lost just under nine percent of their value over the past year, and are down by more than 15 percent in the year-to-date.

AstraZeneca announced in a statement this morning that the Advisory Committee on Immunisation Practices of the US Centres for Disease Control and Prevention (CDC) had ruled that the pharmco’s Flumist Quadrivalent vaccine should not be used in any setting, based on data which indicated that it did not demonstrate statistically significant effectiveness in children.
The company further noted that the distribution and use of the vaccine in other countries were progressing as planned for the forthcoming influenza season, pending the annual release process from relevant regulatory authorities.
The Anglo-Swedish drugmaker said that it would take an inventory writedown of approximately $80 million in the second quarter of year, but maintained its full-year financial guidance. AstraZeneca’s US product sales of the vaccine amounted to $206 million last year.
The Wall Street Journal reported in its coverage of the news that while it was not clear why the vaccine was not working, Dr Joseph Bresee, a flu expert at the CDC, had noted that some suspected that it had to do with a decision to incorporate four strains of flu in Flumist instead of the traditional three, with the added strain potentially reducing the body’s response to another strain.
As of 08:54 BST, Thursday, 23 June, AstraZeneca plc share price is 3,888.25p.