Sodertalje, Sweden-After two consecutive years of robust postmerger growth, AstraZeneca is facing a tough 2001. The company recorded a 16 percent increase in pretax profits for 2000, but CEO Tom McKillop advises that this year’s growth will be in the 5–6 percent range when Losec/Prilosec (omeprazole)-the world’s best-selling medicine-goes off patent and the US launch of its successor Nexium (esomeprazole) is delayed.

In so doing, McKillop took pains to avoid the impression that he was issuing a profits warning. To a degree, it worked. The company’s share price fell following McKillop’s statement but rallied to finish only slightly lower. A profits warning could have had a much greater impact. Nevertheless, ABN Amro, Lehman Brothers, and ING Barings/Charterhouse Securities downgraded the company’s stock.

AstraZeneca’s sales rose by 8 percent to $15.8 billion in 2000, with a 12 percent increase in the all-important US market. In Japan, sales grew by 8 percent, and in Europe, strong growth in France and Italy helped offset generic competition in Germany and price cuts in the United Kingdom to produce 6 percent sales growth.

Worldwide sales of Losec grew by 9 percent to $6.26 billion. But the medication is in its final days of exclusivity, and AstraZeneca hopes to win an October extension to the scheduled April patent expiration.

McKillop acknowledges that growth in the future will be different from success in the past. He says the company unveiled major clinical trials for Nexium, Viozan (AR-C68397AA), Iressa (ZD1839), and Crestor (rosuvastatin), and is encouraged by sales in the countries where Nexium and Symbicort (budesonide/formoterol) had early launches. He admits, however, that Nexium’s US launch was delayed by continued discussions with FDA about labeling.