By Denise Roland 

LONDON -- AstraZeneca PLC, battered by a string of patent expiries in recent years, reported its strongest sales growth since 2009 as efforts to replenish its pipeline and pivot toward cancer drugs started to pay off.

The Cambridge, England-based drugmaker said product sales rose 4% to $21 billion in 2018 and that growth would accelerate this year, forecasting a high single-digit percentage increase. Shares rose almost 6% on the news.

Thursday's results could mark a turning point for AstraZeneca. At its peak, the company raked in sales of around $33 billion, but that has declined for most of the past decade as blockbusters like anti-cholesterol pill Crestor and heartburn drug Nexium faced competition from cheap, generic versions.

Chief Executive Pascal Soriot, who joined AstraZeneca in 2012, has invested heavily in research and development to rebuild the company's once-threadbare pipeline, especially in the area of cancer medicine.

Many of those drugs, now on the market, are driving the sales growth. Revenue from AstraZeneca's oncology drugs, such as Tagrisso for lung cancer and Lynparza for ovarian cancer, increased 49% to $6 billion.

Dr. Soriot has long promised investors that sales would start to grow in 2018 and roughly double by 2023. He made the pledge while fending off an unwelcome takeover approach from Pfizer Inc. five years ago.

"There is no reason we could not continue to grow over the next five to six years," he said in a press conference Thursday. "It's not a question of whether we are going to grow but at what speed we will grow."

Analysts are skeptical that AstraZeneca can hit the target of sales of $40 billion by 2023. Estimates compiled by FactSet show they expect sales of $33.5 billion by then. Nonetheless, Dr. Soriot has stood by that goal.

Another bright spot for AstraZeneca last year was the Chinese market, where sales increased 25% to $3.8 billion. China has recently eased the path for foreign drugmakers to get their products approved there.

Shares in the company rose more than 4% in early trading in response to the upbeat results.

Still, investors will have to wait for those efforts to hit the bottom line: A ramp-up in investment behind new drug launches and the expansion in China meant core operating profit, a measure watched closely by analysts, slid 17% to $5.7 billion last year. AstraZeneca said it expects core operating profit to increase by a midteen percentage in 2019.

Total revenue, which includes proceeds from deals to partner or unload certain drugs, slipped 2% to $22.1 billion, while net profit dropped 28% to $2.16 billion.

--Carlo Martuscelli contributed to this article.

Write to Denise Roland at Denise.Roland@wsj.com

 

(END) Dow Jones Newswires

February 14, 2019 08:43 ET (13:43 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.
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