What
science
can do
AstraZeneca
Annual Report and Form 20-F Information 2024
What
science
can do
We are a global, science-led, patient-focused
pharmaceutical business, committed to
excellence in the research, development and
commercialisation of prescription medicines.
We aim to transform the lives of patients with
improved outcomes and a better quality of life.
Our Supplements
Detailed information on our Development
Pipeline, Patent Expiries of Key Marketed
Products and Risk.
See our website,
www.astrazeneca.com/annualreport2024.
Our sustainability reporting
Our sustainability reporting is
prepared in line with the
UK Companies Act 2006, sections
414CA and 414CB. In anticipation
of the EU Corporate Sustainability
Reporting Directive (CSRD), we have
started to incorporate selected
disclosures in this Annual Report.
Our key topics covered include material
sustainability topics, which have been identified
through our double materiality assessment,
see page 60 for more information.
Front cover image:
Oncology research and development (R&D) strategy.
In Oncology R&D, we have a breadth of scientific
platforms to attack cancer from multiple angles,
and we are harnessing the power of combinations
to drive even deeper responses and bring potential
for cure to more patients.
Use of terms:
In this Annual Report, unless the context otherwise
requires, ‘AstraZeneca’, ‘the Group’, ‘we’, ‘us’ and ‘our’
refer to AstraZeneca PLC and its consolidated entities.
Welcome
Strategic Report
Chair’s Statement
2
Chief Executive Officer’s Review
3
What science can do
5
AstraZeneca at a Glance
6
Healthcare in a Changing World
7
Our Purpose, Values and Business Model
10
Our Strategy and Key Performance Indicators
12
Therapy Area Review
16
Business Review
32
Disclosure Statements
59
Risk Overview
64
Financial Review
67
Financial Statements
Preparation of the Financial Statements
and Directors’ Responsibilities
138
Directors’ Annual Report on Internal
Controls over Financial Reporting
138
Independent Auditors’ Report
139
Consolidated Statements
148
Group Accounting Policies
152
Notes to the Group Financial Statements
160
Group Subsidiaries and Holdings
214
Company Statements
219
Company Accounting Policies
221
Notes to the Company Financial Statements
223
Group Financial Record
226
Corporate Governance
Chair’s Introduction
86
Corporate Governance Overview
87
Board of Directors
88
Senior Executive Team (SET)
90
Corporate Governance Report
91
Nomination and Governance Committee Report
100
Science Committee Report
102
Sustainability Committee Report
103
Audit Committee Report
104
Directors’ Remuneration Report
112
Additional Information
Shareholder information
228
Directors’ Report
230
Sustainability supplementary information
233
Trade Marks
239
Glossary
240
Cautionary statement regarding
forward-looking statements
244
Contents
Key
For more information within
this Annual Report.
For more information,
see www.astrazeneca.com.
BV
Denotes sustainability
information independently
assured by Bureau Veritas.
Material sustainability
metric, is independently
assured by Bureau Veritas,
see definitions from
page 234.
Total Revenue
1
Up 18% at actual rate of exchange to
$54,073 million (up 21% at CER), comprising
Product Sales of $50,938 million (up 16%; 19%
at CER), Alliance Revenue of $2,212 million
(up 55%; 55% at CER) and Collaboration
Revenue of $923 million (up 56%; 54% at CER)
Net cash inflow from operating activities
Up 15% at actual rate of exchange to
$11,861 million
2024
2023
2022
$45,811m
$44,351m
$54,073m
$54.1bn
$54.1bn
$11,861m
$10,345m
$9,808m
2024
2023
2022
$11.9bn
$11.9bn
Reported Operating profit
Up 22% at actual rate of exchange to
$10,003 million (up 32% at CER)
Core Operating profit
Up 16% at actual rate of exchange to
$16,928 million (up 22% at CER)
$10,003m
$8,193m
$3,757m
2024
2023
2022
$10.0bn
$10.0bn
$16.9bn
$16.9bn
$16,928m
$14,534m
$13,350m
2024
2023
2022
Reported EPS
Up 18% at actual rate of exchange to $4.54
(up 29% at CER)
Core EPS
Up 13% at actual rate of exchange to $8.21
(up 19% at CER)
$4.54
$3.84
$2.12
2024
2023
2022
$4.54
$4.54
$8.21
$7.26
$6.66
2024
2023
2022
$8.21
$8.21
1
As detailed from page 152, Total Revenue consists of Product Sales, Alliance Revenue and Collaboration Revenue.
Denotes a scale break. Throughout
this Annual Report, all bar chart
scales start from zero. We use a
scale break where charts of a
different magnitude, but the same
unit of measurement, are
presented alongside each other.
For more information in relation
to the inclusion of Reported
performance, Core financial
measures and constant exchange
rate (CER) growth rates as used
in this Annual Report, see the
Financial Review from page 67
and for more information on the
reconciliation between Reported
and Core performance, see the
Reconciliation of Reported results
to Core results in the Financial
Review on page 72.
Financial highlights
1
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Contents
$3.10
Full-year dividend of $3.10
per share (2023: $2.90)
“2025 marks the beginning of an unprecedented,
catalyst-rich period for AstraZeneca, an important
step on our Ambition 2030 journey.”
It starts with our science, and is a powerful
vindication of the value of innovation. It is also
a source of great pride, as it holds the hope
of improving care for millions of people.
Likewise, what we are doing resonates with
the stakeholders I speak to – healthcare
professionals, patient advocacy groups,
policymakers and investors. Whatever their
perspective, they want to see us succeed
and deliver the value of better health for
people, society and the planet.
A world in flux
Geopolitical shifts, crises and conflict are
changing the world around us. They interact
with economic, demographic, societal,
environmental and technological
transformations, constantly changing the
conditions in which we operate. Business
cannot hope to predict every event or
outcome but we can strengthen, through
active risk management, our capabilities
to absorb shocks and adapt our operations.
Appropriate risk management enables us to
continue implementing our overall strategy
to achieve growth, drive innovation and
reach more patients.
We are, for example, seeing a more
economically diverse landscape with
the rise of key emerging markets and a
relative decline of economic concentration
in the West. In addition, governments
are increasingly focused on strategic
autonomy, driven by concern over national
security, crisis preparedness, economic
competitiveness and sovereignty in key
sectors. There is also strong pressure to
build resilient supply chains, particularly in
response to climate change. Such trends
are interlinked, presenting challenges and
risks we need to mitigate. But they also present
opportunities for growth and innovation.
A strategic approach to healthcare
Given the well-evidenced societal and
economic benefits, we believe governments
must prioritise investment in Health and
develop sustainable financing solutions.
This requires public and private sectors to
collaborate to ensure healthcare investments
are strategic and targeted to maximise
positive impact, transform service delivery
and generate long-term savings for health
systems. By prioritising investment in
screening and treating disease early, by
keeping people healthy, out of hospital and
economically productive, we can reduce
healthcare costs. At the same time,
investing in more climate-resilient, net-zero
health systems can help build a more
sustainable and equitable future. And,
eventually, it will considerably improve
health equity and leave nobody behind.
Finally, strengthening health systems will help
them be more resilient, ensuring they are
prepared for future crises and able to adapt
to changing needs. Global collaborations
like the Partnership for Health System
Sustainability and Resilience (PHSSR) are
driving this transformation. AstraZeneca is a
founding member of the PHSSR, now active
in more than 30 countries, which commissions
independent research and develops
evidence-based policy recommendations
for change.
Outlook
2025 marks the beginning of an
unprecedented, catalyst-rich period for
AstraZeneca, an important step on our
Ambition 2030 journey. We are also investing
in and making significant progress with
transformative technologies that have the
potential to drive our growth well beyond 2030.
Michel Demaré
Chair
From my perspective, as AstraZeneca’s Chair,
I have once again witnessed first-hand the
impact we are making for patients and
communities across the globe. We are
making a real difference.
Performance
AstraZeneca sustained strong momentum
in 2024, with Total Revenue up 18% (21% at
CER) and Reported EPS up 18% (29% at CER).
Core EPS was up 13% (19% at CER).
Following the announcement at our Annual
General Meeting in April, the Board has
declared a second interim dividend of
$2.10 per share, making a total dividend
declared for the full year of $3.10 per share.
The increase, of 7%, over 2023 underscores
our confidence in future growth.
A dedicated team
Of course, every global company is from time
to time exposed to difficulties and 2024 was
no different for AstraZeneca, as we navigated
some challenging geopolitical circumstances.
These included investigations by the Chinese
authorities, with whom we continue to
cooperate fully. However, it is in times such
as these that we can really appreciate the
team ethos and dedication of our people and
the Board to deliver for patients. On behalf
of the Directors, I extend my thanks to Pascal,
the Senior Executive Team and everyone for
the contributions they made to our success.
Strategic ambition
At our Investor Day, we set out our Ambition
2030, an exercise in which the Board was
deeply involved and supportive, and which
demonstrates the trust in our pipeline.
AstraZeneca has ambitious
plans and is working in
collaboration for healthier
people, society and the planet.
2
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
Chair’s Statement
$54.1bn
Total Revenue (2023: $45.8bn)
74
Regulatory events – submissions
or approvals in major markets
“By 2030, we aim to launch at least 20 new
medicines and achieve $80 billion in Total
Revenue, with sustained growth thereafter.”
against our 2030 target. Our science was
selected for plenary sessions at the annual
meeting of the American Society of Clinical
Oncology, for the sixth year running, as well
as a remarkable five Presidential Plenary
sessions at lung cancer and European
oncology congresses.
We also continued to move earlier in the
treatment of disease, where there is
greatest chance of success, and stepped
up efforts to improve patient outcomes by
harnessing the power of combinations, not
only in oncology but prospectively in weight
management, as well as through patient-
friendly devices and formulations. Our focus
on patients is demonstrated by
Airsupra
,
where the readout from the BATURA trial
both showed overwhelming efficacy in
treating asthma but importantly was the
first pivotal study to eliminate all in-person
clinic visits.
Growing and leading
We delivered a very strong performance
in 2024, with Total Revenue increasing to
$54.1 billion.
In our therapy areas, Total Revenue for
Oncology increased 21% (24% at CER),
Cardiovascular, Renal & Metabolism by 18%
(20% at CER), Respiratory & Immunology by
23% (25% at CER), Vaccines & Immune
Therapies by 8% (8% at CER) and Rare
Disease grew by 13% (16% at CER).
In our regions, Total Revenue increased by
22% in the US, 14% (22% at CER) in
Emerging Markets and by 27% (26% at CER)
in Europe. Total Revenue decreased by 2%
(increased by 3% at CER) in Established RoW.
In 2024, the US represented 43% of Total
Revenue. Across the world, our therapy area
leadership is reflected in the fact that, for
the first time, we are the number one
pharmaceutical company across our
2024 was a truly memorable year for
AstraZeneca. First, it was yet another year
in which we advanced our high-quality
pipeline, successfully delivered medicines
to millions of patients and further increased
our contribution to society and the planet.
Secondly, it was the year in which we were
able to look back and celebrate 25 years of
pioneering science since the formation of
AstraZeneca in 1999. Additionally, it was
the year in which we took the opportunity
to look forward to 2030 and beyond as we
outlined the scale of our ambition and what
we aim to achieve today, tomorrow, and the
day after.
That ambition, set out in our Investor Day
in May, is to be pioneers in science, lead
in our disease areas and transform patient
outcomes. By 2030, we aim to launch at
least 20 new medicines and achieve
$80 billion in Total Revenue, with sustained
growth thereafter. We are also pursuing
ambitious science-based decarbonisation
targets in support of achieving net zero
by 2045.
Achieving today
Outstanding science
2024 was a year of scientific breakthroughs.
For example, we received approvals for
Voydeya
(danicopan),
Kavigale
(sipavibart)
and
Datroway
(datopotamab deruxtecan),
taking us to a total of eight medicines
A year in which we
delivered medicines
to millions of patients,
looked back on 25
years of pioneering
science and outlined
the scale of our
ambition for the future.
Emerging Markets, achieving this milestone
one year ahead of plan. This includes China,
where we are committed to contributing to
the long-term development of the life
sciences sector. We are also one of the top
three pharmaceutical companies across our
Europe and Canada region and are making
great progress to become the number one
company in Japan, where we are already
number one in oncology.
Talented people working sustainably
Our strong progress is made possible by
the commitment and efforts of our team, not
least by the way they are embracing digital,
data and AI to speed our progress and
improve how we work. And, as we grow,
we have increased our focus on learning
and development – building the skills and
capabilities that will sustain our success –
as well as continuing to cultivate an
inclusive culture that reflects our patients
and communities, and supports innovation.
As mentioned by Michel Demaré, our
Chair, in 2024 we continued to invest in
collaborations and initiatives to strengthen
health systems. We are also investing in
climate and nature action, and maintain a
leading role in industry efforts to address
the effects of climate change and accelerate
the delivery of net-zero sustainable
healthcare, while improving health outcomes
and decreasing our impact on the planet,
reducing carbon emissions, water
consumption and waste generation. Our
sustained progress in reducing greenhouse
gas emissions has enabled a 77.5%
reduction in Scope 1 and 2 emissions
from our 2015 baseline.
3
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Chief Executive Officer’s Review
Chief Executive Officer’s Review
Delivering tomorrow
Industry-leading pipeline
Our ability to deliver for patients tomorrow
was underlined in 2024 by our pipeline
which saw a record number of 74 regulatory
events, namely submissions or approvals
for our medicines in a major market, an
increase of almost one third over 2023.
The year also saw nine positive high-value
Phase III readouts. In Oncology,
Imfinzi
’s
further potential was apparent in two trials:
NIAGARA demonstrated that immunotherapy
could significantly extend the lives of
patients with bladder cancer while, in
ADRIATIC, it was the first and only
immuno-oncology to show survival benefit
in limited-stage small cell lung cancer.
The ECHO and AMPLIFY trials demonstrated
the potential for
Calquence
in mantle cell
lymphoma and chronic lymphocytic
leukaemia. It was also great to see positive
results from LAURA, which cemented
Tagrisso
as the standard of care in
unresectable EGFRm non-small cell lung
cancer. DESTINY-Breast06 confirmed
Enhertu
’s potential to evolve the current
HR-positive breast cancer treatment
landscape. In BioPharmaceuticals, the
WAYPOINT trial showed
Tezspire
’s potential
as an important new treatment option for
patients with nasal polyps while, in Rare
Disease, the KOMET trial results for
Koselugo
support its potential expanded
use in adults living with NF1 PN – a
devastating rare genetic disease.
Additionally, we had 24 pipeline progressions
in 2024, being Phase II starts/progressions
and Phase III investment decisions. Once
again, the strength and quality of our
pipeline was recognised in the granting by
regulators of 28 designations across 18
projects, including Breakthrough Therapy,
Priority Review or Fast Track designations.
Even in such a year of success, when pushing
the boundaries of science, it is normal to
experience setbacks which included the
termination of the vemircopan (ALXN2050)
Phase II development programme for rare
diseases. On such occasions, we are
committed to living our Values of following
the science and putting patients first, by
learning from what challenges tell us and
how they can help us in realising the full
potential of our medicines and benefit as
many patients as possible. We also share
data with the wider scientific community.
Datroway
exemplifies our approach.
While we voluntarily withdrew applications
in the US and EU for the treatment of
non-squamous non-small cell lung cancer
(NSCLC), it was subsequently granted
Breakthrough Therapy Designation in the
US for patients with previously treated
advanced EGFR-mutated NSCLC. In
January 2025, it was also granted Priority
Review, given by the FDA to applications
for medicines that, if approved, would offer
significant improvements over available
options. I was also delighted when, in
December, our partner, Daiichi Sankyo,
received the first approval for
Datroway
for
the treatment of patients with metastatic
HR-positive, HER2-negative breast cancer
in Japan. This was swiftly followed in
January by the approval in the US of the
similar AstraZeneca-led application.
Datroway
offers patients an effective and
better tolerated alternative to traditional
chemotherapy and the approvals
underscore the potential of the medicine to
replace chemotherapy and deliver improved
outcomes across multiple cancer types.
Health equity and climate
In Rare Disease, as part of our ambition
for 2030, we are committed to reaching
six times as many patients as 2022 across
100 countries with our transformative rare
disease medicines. We are on track to reach
this commitment – in 2024, our medicines
were available in more than 70 countries.
As we grow across new and existing
markets, we are working with local rare
disease advocates, healthcare systems
and policy makers to help shape the rare
disease ecosystem to shorten the
diagnostic journey, improve access to
treatment and ensure stakeholders
understand the societal value of rare
disease innovation.
Our efforts in Rare Disease complement
those across all our therapy areas to close
healthcare gaps and give people everywhere
the chance to be as healthy as possible.
We are doing so by embedding health
equity across the whole enterprise, from
science to the delivery of care. We want to
better understand the factors that drive
poor health outcomes among diverse
populations, partnering with governments,
health systems and communities to
co-create solutions.
The climate crisis is the largest health crisis
of our time and has a significant impact on
respiratory diseases which can be complex,
difficult to treat, often poorly controlled and
associated with a higher carbon footprint of
care. We are focused on addressing this
challenge by optimising care with our portfolio
of respiratory medicines. At the same time,
we are transitioning our inhaled medicines
to a next-generation propellant (NGP) with
near-zero global warming potential – 99.9%
lower than current propellants, and were
proud to make our first regulatory submission
for
Breztri
NGP in the EU in 2024.
Preparing for the day after tomorrow
Our ambition for AstraZeneca extends
beyond 2030 and, as shown on the next
page, we are working on technologies
that will, we believe, shape the future of
medicine and sustain our growth. Our work
is built on our internal efforts but we have
also leveraged external innovation to
expand and accelerate our pipeline.
For example, the acquisition of Fusion
brought new expertise in actinium-based
radioconjugates, including one for prostate
cancer, as well as state-of-the-art
manufacturing capabilities, while our
acquisition of Gracell in China allows us to
accelerate our ambitions in cell therapy,
particularly in haematology and
autoimmune disease.
Weight management is a particular
challenge as many affected people are
living with complex, interconnected
diseases. Treating each disease separately
without addressing obesity as a root cause
does not optimise outcomes for them or
healthcare systems. Building on our existing
expertise, our rapidly developing weight
management portfolio looks beyond
short-term weight loss to address individual
patient needs. Our aim with these therapies
is to provide durable weight loss, with
cardiometabolic benefit and new options for
patients by targeting linked disease biology.
Appreciation
AstraZeneca only achieved what we did in
2024, and can only deliver our ambition for
2030 – and beyond
– with great people in
high-performing teams. On behalf of the
Senior Executive Team, I would like to
thank everyone in AstraZeneca for all they
accomplished in 2024 and for their focus
on realising our goals for people, society
and the planet.
Pascal Soriot
Chief Executive Officer
4
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
For more information, see Research & Development from page 34.
Investing in transformative new technologies and
modalities that will shape the future of medicine
and sustain AstraZeneca’s growth post 2030.
Our investments in
transformative R&D
technologies include:
Antibody drug conjugates
and radioconjugates that
aim to replace systemic
chemotherapy and
radiotherapy, see
page 36.
Cell therapy and T-cell
engagers that are more
scalable across therapy
areas, see page 44.
Gene therapy and gene
editing that could make
cures possible for a range
of rare diseases, see
page 49.
Next-generation immuno-
oncology bispecifics that
establish new immuno-
oncology segments, see
page 55.
Weight management that
looks beyond short-term
weight loss to address
individual patient needs,
see page 46.
What science
can do
Medicines for today,
tomorrow and the day after.
Corporate Governance
Additional Information
Financial Statements
Strategic Report
5
AstraZeneca
Annual Report & Form 20-F Information 2024
What Science Can Do
Our strategic priorities
Our priorities reflect how we are
working to deliver our Growth
Through Innovation strategy and
achieve our Purpose of pushing
the boundaries of science to
deliver life‑changing medicines.
1. Science and
Innovation
2. Growth and
Therapy Area
Leadership
3. People and
Sustainability
Science and innovation-led
We invest in new technologies
and modalities to deliver the
next wave of pipeline innovation
and life‑changing medicines.
191
projects in our
development
pipeline
1
19
new molecular
entities (NMEs) in
our late-stage
pipeline
130
NME or major
life-cycle
management (LCM)
projects in Phase II
and Phase III
$13.6bn
invested in our
science
1
Includes NME and major LCM projects up to launch in all applicable major markets.
Leading in our therapy areas
We focus on areas where we
can transform patient outcomes
through novel medicines and
combinations.
Total Revenue
by therapy area
2
$22.4bn, 41%
Oncology
$21.9bn, 40%
BioPharmaceuticals
$8.8bn, 16%
Rare Disease
$1.1bn, 2%
Other Medicines
Total Revenue
$54.1bn
$54.1bn
$45.8bn
$44.4bn
2024
2023
2022
2
Due to rounding, the sum of subtotals and percentages may not agree to totals.
Diversified portfolio and
global reach
We deliver a diversified portfolio
of medicines across primary
care, specialty care and rare
diseases through our broad‑
based network and increasing
presence in emerging markets.
Total Revenue
by reporting region
$23.2bn, 43%
$13.7bn, 25%
$12.2bn, 23%
$5.0bn, 9%
Total Revenue growth by reporting region
3
22%
14%
27%
-2%
3
Actual growth percentage.
Positively impacting the health
of people, society and the
planet
BV
We operate responsibly,
harnessing the power of science
and innovation, and our global
reach, to help build a healthier,
more sustainable future.
90.5m
people reached by
our access to
healthcare
programmes
77.5%
reduction in
Scope 1 and 2
GHG emissions
since 2015
Rating of AA in the
MSCI ESG Ratings
assessment
Ranked in the
top five of the
Access to Medicine
Index 2024
Key
US
Emerging Markets
Europe
Established Rest of World
6
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
AstraZeneca at a Glance
We are a global, science-led, patient-focused pharmaceutical
company. We are dedicated to transforming the future of
healthcare by unlocking the power of what science can do
for people, society and the planet.
2024
2023
2022
107
100
111
Established RoW ($bn)
$111bn
(+4.3%)
$111bn
(+4.3%)
686
608
762
US ($bn)
2024
2023
2022
$762bn
(+11.1%)
$762bn
(+11.1%
)
290
269
318
Emerging Markets ($bn)
2024
2023
2022
$318bn
(+9.7%)
$318bn
(+9.7%)
259
240
280
Europe ($bn)
2024
2023
2022
$280bn
(+8.2%)
$280bn
(+8.2%)
1,343
1,219
1,473
World ($bn)
2024
2023
2022
The external environment presents both
challenges and opportunities that require
us to adapt, innovate and build trust.
Global pharmaceutical sales
In 2024, Established Markets
1
saw an
average revenue increase of 9.7% and
Emerging Markets revenue grew by 9.7%.
The US, China, Japan, Germany and France
are the world’s top five pharmaceutical
markets by 2023 sales. In 2024, the US had
51.8% (2023: 51.1%; 2022: 49.9%) of global
sales, while China had around 7%.
Data based on world market sales using AstraZeneca Market definitions as set out on page 240. Changes in data subscriptions, exchange rates and subscription coverage, as well as
restated IQVIA data, have led to the restatement of total market values for prior years. Source: IQVIA, IQVIA Midas Quantum Q3 2024 (including US data). Reported values and growth
are based on CER. Value figures are rounded to the nearest billion and growth percentages are rounded to the nearest tenth.
We expect both developed and developing
markets, including North America, Other
(Non-EU) Europe, the Indian subcontinent
and Latin America to fuel pharmaceutical
growth. Market growth in China is expected
to remain below historical levels at a
compound annual growth rate of 2.6%
(±1.5%). This is due to the continued
slowdown of the major hospital sector.
1
Established Markets means US, Europe and
Established RoW.
2
North America means US.
3
Non-EU countries; including the UK.
4
Commonwealth of Independent States; includes
Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan,
Kyrgyzstan, Moldova, Russia, Tajikistan, Turkmenistan
and Uzbekistan and excludes Ukraine.
$1,473bn
(+9.7%)
Estimated pharmaceutical sales 2028.
Data is based on ex‑manufacturer
prices at CER. Source: IQVIA.
Estimated pharmaceutical market
growth. Data is based on the
compound annual growth rate from
2023 to 2028. Source: IQVIA Market
Prognosis Global 2023–2028.
Other
Europe
3
$71.7bn
11.8%
Japan
$66.7bn
0.9%
China
$159.9bn
2.6%
Oceania
$18.1bn
3.3%
Southeast
and East Asia
$222.0bn
3.6%
Middle East
$26.8bn
7.7%
Africa
$22.7bn
5.7%
Indian
subcontinent
$37.8bn
9.4%
CIS
4
$28.9bn
6.8%
EU
$290.1bn
6.3%
North America
2
$853.1bn
8.2%
Latin America
$94.1bn
14.3%
Estimated pharmaceutical sales and market growth to 2028
A growing pharmaceutical sector
The pharmaceutical sector continues to grow against a backdrop
of increasing demand for healthcare. Global pharmaceutical sales
grew by 9.7% in 2024. Global healthcare spending is projected to
increase at an annual rate of 7.4% from 2023 to 2028.
Healthcare in a Changing World
Corporate Governance
Additional Information
Financial Statements
Strategic Report
7
AstraZeneca
Annual Report & Form 20-F Information 2024
Healthcare in a Changing World
The pharmaceutical sector faces economic challenges, geopolitical uncertainty and
the impacts of ageing populations and the climate crisis. Rapidly-advancing technologies
offer many benefits, while demographic change is driving an increased demand for
healthcare. Successful organisations are transparent, accessible, and build trust with
their stakeholders.
Impact of global trends
Escalating geopolitical
tensions present
profound challenges
and opportunities for
global business.
Global growth remains
low but stable after decline
in inflation and rising
protectionist policies.
Accelerating pace of
ageing populations in
low- and middle-income
countries.
The world continues to shift from a period
of global cooperation to one of heightened
competition and discord, producing a more
volatile and confrontational geopolitical
environment. This trend has acute
consequences for security, trade and
global collaboration.
In this fragmented climate, new forms
of conflict are emerging. With the rise of
emerging powers such as India and Brazil,
sustained strategic rivalry between the US
and China, as well as conflicts, such as the
war in Ukraine, adversaries are beginning to
wield new weapons of disinformation, cyber
threats and competition space which are
emerging alongside traditional warfare.
Some are choosing to exploit economic
interdependence to create geopolitical
dependencies, which can impact supply
chains of both traditional and emerging
sectors vital for the digital and green
transitions. However, such trends also
present opportunities as companies are
encouraged to localise operations to
mitigate supply chain risks.
(Source: ESPAS Global Trends to 2040
: Choosing
Europe’s Future, April 2024)
These growth projections remain below
pre‑pandemic averages. For advanced
economies, GDP is expected to rise from
1.7% in 2023 to 1.8% in both 2024 and 2025.
Growth in emerging markets and developing
economies is projected to slow from 4.4%
in 2023 to 4.2% in both 2024 and 2025,
generally as a result of increased regional
conflicts and extreme weather events.
Forecasts for global growth over the
medium term remain at 3.1%, with low
productivity growth, investment and ageing
populations hindering advancement.
Recent election results, particularly in
the US, also pose potentially significant
consequences for the global economy.
Prospective trade tariffs and other
protectionist policies could exacerbate
inflation, trade tensions and supply chain
disruption across the world, and could
hamper medium‑term growth.
Global inflation is forecast to further decline,
from a peak of 9.4% in 2022 to 3.5% by the
end of 2025.
(Source: IMF World Economic Outlook, October 2024;
Reuters, November 2024)
By 2050, two thirds of the world’s ageing
population is expected to live in low‑ and
middle-income countries (LMICs). LMICs
are disproportionately affected by non‑
communicable diseases (NCDs). In total,
NCDs represent 75% of non‑pandemic
related deaths globally. Cardiovascular
diseases account for the most NCD deaths
annually (19 million in 2021), followed by
cancers (10 million), chronic respiratory
diseases (four million) and diabetes (two
million). Nearly 75% of these global NCD
deaths (32 million) occur in LMICs. This
rise places increasing strain on poverty‑
reduction initiatives and on already‑
stretched healthcare systems.
Increasing demand for healthcare is putting
pressure on healthcare budgets which,
exacerbated by the impact of the COVID-19
pandemic, is leading to downward pressure
on pricing. The pandemic also saw rising
concern around vaccines and the
proliferation of vaccine misinformation
which has potentially significant
consequences for public health.
(Source: WHO; The Lancet, Volume 401, Issue 10380,
967-970)
Two billion
Approximately two billion people were
eligible to vote in national elections
held in over 70 countries in 2024.
(Source: Statista, November 2024)
3.2%
Global GDP growth forecast to stabilise
from 3.3% in 2023 to 3.2% in both 2024
and 2025.
(Source: International Monetary Fund (IMF)
World Economic Outlook, October 2024)
426 million
Between 2020 and 2050, the number of
people aged 80 years or older is expected
to triple to 426 million.
(Source: World Health Organization (WHO))
Political
Increasing geopolitical
friction
Economic
Activity remains below
pre-pandemic levels
Societal
Growing population ageing and
downward pressure on pricing
These risks are explored
further in the Risk Overview
from page 64 and Accessible
and affordable healthcare from
page 52.
Strategic Report
8
AstraZeneca
Annual Report & Form 20-F Information 2024
Healthcare in a Changing World
continued
The significant potential of
AI is already transforming
the pharmaceutical
industry.
The climate crisis is
the greatest public
health crisis of our time,
increasing ill health
and jeopardising access
to healthcare.
In research and early discovery, data
and AI could accelerate the identification
processes for potential new drugs and
increase our understanding of the
underlying conditions, helping new
medicines to be approved and marketed
for use more quickly. For medical
professionals, data and AI could also
boost productivity and reduce errors
and costs by automating the more time‑
consuming exercises of record keeping
and document creation.
However, these new technologies have
inherent risks. For example, the dangers
of IP infringement and data privacy,
AI hallucination and inaccuracy. Against
the backdrop of the evolving uncharted
regulatory landscape and high stakes
associated with developing treatments for
disease, these risks mean that companies
will need to put strong controls and policies
in place to manage data and AI and to fully
realise the benefits.
(Source: McKinsey & Company, January 2024)
The impacts of the climate emergency,
coupled with ageing populations and a rise
in chronic diseases, are worsening health
inequities and adding further pressure to
health systems. Certain populations are
disproportionately impacted including
women, the elderly, children, those with
existing health issues and the most
marginalised in society, who have often
contributed least to the climate crisis,
making this a health equity crisis.
The immediate health impacts of climate
change could also limit the ability of primary
care resources to treat longer‑term, complex
diseases. Furthermore, there is a growing
recognition of the importance of nature and
acting to protect and restore ecosystems
for the health of people and the planet.
(Source: The Lancet, Volume 404, Issue 10465,
1847-1896)
The accelerating pace
of innovation offers
potential for success
but may exacerbate
issues with trust.
With the continued advancements in
science and digital technologies, the rate
of innovation in society is accelerating at
an unprecedented pace. With the rise of AI,
multi‑omics, gene‑based therapies and
functional genomics, the scientific industry
is flourishing. Pharmaceutical companies
are using these innovations to uncover
novel drivers of disease and progress new
drug modalities, ultimately leading to more
successful outcomes for patients.
While offering the potential to revolutionise
the healthcare industry, this rapid rise
could exacerbate already‑present trust
issues. Concerns around the politicisation
of science and the regulation of these
emerging innovations remain at the heart of
discussions around the acceptance of these
innovations. To succeed, pharmaceutical
companies and the scientific industry as a
whole need to more effectively communicate
with the general public, engaging them in
dialogue and making science more
transparent and accessible.
(Source: 2024 Edelman Trust Barometer)
$110 billion
Generative AI is estimated to produce
$60 billion to $110 billion in economic value
annually for the pharmaceutical industry.
(Source: McKinsey & Company, January 2024)
167%
Record-breaking increase in
heat-related deaths among those
over 65 years old in 2023.
(Source: The Lancet, Volume 404, Issue 10465,
1847-1896)
73%
In a 28-country survey, 73% of people
questioned rated the healthcare
industry trustworthy, but only 50%
trusted gene-based medicine.
(Source: 2024 Edelman Trust Barometer)
Technological
Emerging opportunities and
risks with data and AI
Environmental
Deep interconnection between
climate and health
Outlook
Opportunities and challenges
for the sector
Corporate Governance
Additional Information
Financial Statements
Strategic Report
9
AstraZeneca
Annual Report & Form 20-F Information 2024
Healthcare in a Changing World
How we deliver on our business model
How we add value
Improved health
Continuous scientific innovation is vital
to achieving sustainable healthcare,
which creates value by:
•
Improving health outcomes and
transforming the lives of patients who
use our medicines.
•
Enabling healthcare systems to reduce
costs and increase efficiency.
•
Improving access to healthcare and
healthcare infrastructure.
•
Helping develop the communities
in which we operate through local
employment and partnering.
Financial value
Revenue from our Product Sales and
collaboration activities generates cash
flow, which helps us:
•
Fund our investment in science and
the business to drive long‑term value.
•
Follow our progressive dividend policy.
•
Meet our debt service obligations.
>134m
1
Our main therapy area medicines impact
more than 134 million patient lives annually.
Inspired by our Values and what science
can do, we are focused on accelerating
the delivery of life-changing medicines
that create enduring value for patients,
society, the planet and our shareholders.
Our Purpose
Our Values
Our business model
We push the boundaries of science
to deliver life-changing medicines.
Our Values determine how we work
together and the behaviours that drive
our success. They guide our decision
making and define our beliefs.
•
We follow the science
•
We put patients first
•
We play to win
•
We do the right thing
•
We are entrepreneurial
We are a global pharmaceutical business with a science-led and patient-focused value proposition
committed to excellence in the research, development, manufacturing and commercialisation
of prescription medicines across primary care, specialty care and rare diseases. We are also
committed to operating responsibly, and in an ethical and transparent way, to help build a healthier,
more sustainable future. We invest resources to create financial and non-financial value that
benefits patients, society, the planet and our business.
Our Purpose, Values and Business Model
For more information, see
Business Review from page 32.
Strategic Report
Ability to acquire, retain and develop
a talented and diverse workforce.
50.6%
of our senior middle management
roles and above are filled by women
Global commercial presence and skills
that ensure our medicines are available
to patients when needed.
>80
countries in which we have an
active presence
A leadership position in science that
enables us to deliver life‑changing
medicines.
$13.6bn
invested in our science in 2024
Patent protection for our intellectual
property for a reasonable period of
time to prevent our new medicines
being copied.
>90
countries where we obtained
patent protection
Reduction of Scope 1 and 2 GHG
emissions from 2015 baseline year.
77.5%
Ambition Zero Carbon (Scope 1 and 2)
A supply of high‑quality medicines,
whether from our own operations
or from suppliers.
$26.1bn
spent with suppliers
Effective collaborations that supplement
and strengthen our pipeline and our
efforts to achieve scientific leadership.
>1,000
collaborations worldwide
Financial strength, including access to
financing and ability to bear the financial
risk of investing in the life‑cycle of
a medicine.
$11.9bn
net cash inflow from operating activities
10
AstraZeneca
Annual Report & Form 20-F Information 2024
I
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Inputs
• Applying our
resources to
address unmet
medical need
Outputs
• Improved health
• Returns to
shareholders
Our
Purpose
R
e
s
e
a
r
c
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r
s
1
2
3
4
5
6
7
8
9
1
The patient numbers reached for AstraZeneca medicines is an estimation of the average number of patients on therapy in a given year. For historic periods, the calculation is based
upon the volume that AstraZeneca manufactured globally, converted using the number of days of therapy (DoT) and the average patient compliance with their treatment. If a patient
is treated by more than one AstraZeneca product they are double‑counted.
This is a high-level overview of a medicine’s life-cycle and is illustrative only. It is neither intended to, nor does it, represent the life-cycle of any particular medicine or of every
medicine discovered and/or developed by AstraZeneca, or the probability of success or approval of any AstraZeneca medicine.
We create financial value throughout
the life-cycle of a medicine
Investment
We invest in the discovery,
development, manufacturing and
commercialisation of our pipeline
of innovative prescription medicines.
Revenue generation
We generate revenue from Product
Sales of our existing medicines and
new medicine launches, as well as from
our collaboration activities. Our focus
is on creating medicines that facilitate
profitable future revenue generation,
while bringing benefits to patients.
Reinvestment
We reinvest in developing the next
generation of innovative medicines and
in our business to provide the platform
for future sources of revenue in the
face of losses of key patents.
We also assess opportunities to invest in
value‑enhancing additions to our portfolio.
Launch phase – duration: 5-15 years
7. Launch new medicine while
continuously monitoring,
recording and analysing
reported side effects.
8. Post-launch R&D to further
understand the benefit/risk
profile of the medicine and
life‑cycle management
activities to understand
its full potential.
Post-exclusivity – duration: 20+ years
9. Patent expiry and generic
medicine entry.
Research and development phases – duration: 5-15 years
1. Undertake scientific
research to identify
potential new medicines.
2.Preclinical studies in the
laboratory and animals to
understand if the potential
medicine is safe to
introduce into humans.
3. Phase I trials with small groups
of healthy human volunteers
(small molecules) or patients
(biologics) to understand how
the potential medicine is
absorbed into the body,
distributed and excreted.
4.Phase II trials on small‑
to medium‑sized groups
of patients to test
effectiveness, safety
and tolerability of the
medicine and determine
optimal dose.
5.
Phase III trials in a larger
group of patients to
gather information about
effectiveness and safety
of the medicine and
evaluate the overall
benefit/risk profile.
6.Seek regulatory approvals for
manufacturing, marketing
and selling the medicine.
Life-cycle of a medicine
For more information on our
pipeline progression, see our
Development Pipeline Supplement
on our website, www.astrazeneca.
com/annualreport2024.
11
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Our Purpose, Values and Business Model
2024
2023
2022
$11,861m
$10,345m
$9,808m
$11,861m
$11,861m
Net cash inflow from operating activities
$8.21
$7.26
$6.66
Core EPS
2024
2023
2022
$8.21
$8.21
2024
2023
2022
$4.54
$3.84
$2.12
$4.54
$4.54
Reported EPS
Key Performance Indicators
Cash generation is a key driver
of long‑term shareholder returns
and facilitates reinvestment in
our pipeline, which is critical for
delivering new medicines and
future value.
Earnings per share (EPS) is an
important profitability metric and
a key driver of shareholder value.
Actual growth
2024 +15%
2023 +5%
2022 +64%
Actual growth
2024 +13%
2023 +9%
2022 +26%
CER growth
2024 +19%
2023 +15%
2022 +33%
Actual growth
2024 +18%
2023 +81%
2022 n/m
CER growth
2024 +29%
2023 +96%
2022 n/m
Key
Used for remuneration of Executive Directors
Material sustainability metric, is independently assured by
Bureau Veritas, see definitions from page 234.
For more information on:
Our Core measures see the
Financial Review from page 67.
How Group financial targets are
considered when calculating
the annual bonus, see page 121.
Ambition 2030
Our ambition is to be pioneers in science,
lead in our disease areas and transform
patient outcomes. As announced at our
Investor Day in May 2024, by 2030, we aim
to launch at least 20 new medicines and
achieve $80 billion in Total Revenue with
sustained growth thereafter.
Our Key Performance Indicators
and remuneration
We measure our productivity and success
against our Key Performance Indicators (KPIs),
which are aligned to our strategic priorities.
Several KPIs in this section are used to
measure the remuneration of Executive
Directors, allowing us to disclose
aggregated targets without disclosing
sensitive commercial information at the
individual KPI level. Any variances between
the KPI and values used in determining
remuneration are explained in the Directors’
Remuneration Report from page 112. Since
2021, we have included the delivery of our
Ambition Zero Carbon commitments in our
executive incentive arrangements.
Achieve Group Financial Targets
Our ambition is to launch at
least 20 new medicines by 2030.
AstraZeneca:
•
is science and innovation led
•
is focused on our chosen therapy
areas: Oncology; BioPharmaceuticals
(comprising Cardiovascular, Renal
& Metabolism (CVRM), Respiratory
& Immunology (R&I) and Vaccines
& Immune Therapies (V&I)); and
Rare Disease
•
is focused on patients and a
diversified portfolio that spans
across primary care, specialty
care and rare disease
•
has global strength with a balanced
presence across regions
•
has a commitment to people,
society and the planet.
Our Growth Through Innovation strategy has three priorities, whose effective delivery will
help us achieve our financial targets.
Our capital allocation priorities include: investing in the business and pipeline; maintaining
a strong, investment-grade credit rating; potential value-enhancing business development
opportunities; and supporting the progressive dividend policy.
1. Science and
Innovation
3. People and
Sustainability
2. Growth and Therapy
Area Leadership
Achieve Group
Financial Targets
12
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
Strategic Report
Our Strategy and Key Performance Indicators
24
1
30
2
29
3
24
1
24
1
Pipeline progression events
2024
2023
2022
2024
2023
2022
74
1
56
2
72
3
74
1
74
1
Regulatory events
1
The target of 20 reflects medicines
approved since October 2022 and
replaces the goal of delivering 15 new
medicines between 2023 and 2030
referred to in our 2023 annual report.
Three
NME approvals
74
regulatory events
24
pipeline progression
events
191
projects included
in our pipeline,
of which 169 are
in the clinical phase
of development
19
NME projects in
pivotal trials or
under regulatory
review covering 29
indications
17
projects were
discontinued
2024 developments
For more information, see:
Research & Development
from page 34 of the
Business Review.
AI from page 44 of the
Business Review.
2024 Group scorecard
assessment on page 121 for
performance against the
Group scorecard.
Key Performance Indicators
BV
Our science measures incentivise
the development of NMEs and the
maximisation of the potential of
existing medicines. Pipeline
progression events (Phase II NME
starts/progressions and Phase III
investment decisions) measure
innovation and sustainability.
Regulatory events (regulatory
submissions and approvals)
demonstrate the advancement
of this innovation to patients and
the value to the Group.
1
24 against our Group scorecard
for determining annual bonus.
2
30 against our Group scorecard
for determining annual bonus.
3
25 against our Group scorecard
for determining annual bonus.
1
52 against our Group scorecard
for determining annual bonus.
2
46 against our Group scorecard
for determining annual bonus.
3
50 against our Group scorecard
for determining annual bonus.
Accelerate platform of therapeutic
modalities
By harnessing innovation from around
the world, we are pioneering new ways
of targeting the drivers of disease and
accelerating promising therapeutic
modalities, including novel radioconjugates,
cell therapy and genomic medicines.
This breadth of research and clinical
development exemplifies the diversity
of approaches and technologies we are
applying across our growing pipeline,
alongside pipeline combinations that
strengthen our therapy area leadership.
Transform R&D ways of working
We are transforming processes, data and
how we work across R&D and reimagining
patient recruitment and retention to help
meet our portfolio ambition and deliver
medicines to patients faster. We continue
to expand our capabilities by making our
ways of working smarter, and by introducing
new digital tools, connected data and
simpler processes.
Advances in science and technology
are revolutionising the way we work,
enabling us to push the boundaries to
deliver new and better medicines and
treatments more quickly to more patients.
Our strategic focus areas
Deliver the next wave of pipeline
innovation
We are rapidly advancing an industry‑
leading pipeline and investing in new
technologies and modalities to deliver the
next wave of medicines across therapy
areas. Our diverse pipeline comprises
around 200 projects spanning multiple
mechanisms and modalities, designed to
improve outcomes, drive clinical remission
and provide cures for patients around
the world.
Science and Innovation
Eight new molecular
entities delivered
against our Ambition
2030 of launching
at least 20 new
medicines.
1
13
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Our Strategy and Key Performance Indicators
$54,073m
$45,811m
$44,351m
$54,073m
$54,073m
Total Revenue
2024
2023
2022
Realise world-class supply chains
With next‑generation technologies and
modalities, we aim to launch 20 new
medicines and achieve industry‑leading
growth through sustainable world‑class
supply chains. We will harness AI‑powered
drug development, continuous, autonomous
manufacturing techniques and real‑time
product release, taking us from smart to
intelligent supply. We strive to leverage
green technologies to drive low‑carbon
products and sites by design, increase
circularity by reducing waste across our
manufacturing sites and accelerate our
supply chain and supplier decarbonisation.
2024 developments
Total Revenue, comprising Product Sales,
Alliance Revenue and Collaboration
Revenue, increased by 18% (21% at CER)
to $54,073 million.
•
Alliance Revenue increased by 55%
(55% at CER) to $2,212 million.
•
Collaboration Revenue increased by 56%
(54% at CER) to $923 million.
•
Grew Total Revenue across our Therapy
Areas: Oncology 21% (24% at CER) to
$22,353 million; CVRM 18% (20% at CER)
to $12,517 million; R&I 23% (25% at CER)
to $7,876 million; V&I 8% (8% at CER) to
$1,462 million; and Rare Disease 13%
(16% at CER) to $8,768 million.
•
Total Revenue in the US grew by 22% to
$23,235 million. In Emerging Markets it
grew by 14% (22% at CER) to $13,675
million and in Europe it grew by 27%
(26% at CER) to $12,188 million.
Key Performance Indicators
Our Total Revenue measure reflects
the importance of incentivising
sustainable growth in both the
short and long term.
We are working across our therapy
areas to transform care and meet the
increasing demand for healthcare by
improving access to our medicines,
expanding treatment options and
enabling patients to take control
of their own health.
Our strategic focus areas
Achieve industry-leading growth in
our therapy areas
Our diversified portfolio across therapy
areas with broad geographic presence, will
help us achieve industry‑leading growth.
Transform care
AstraZeneca is collaborating with
governments, healthcare systems and
providers to make a positive impact on
the global burden of disease and support
healthcare systems to become more
resilient for future generations, helping
deliver better outcomes for all.
In partnership with healthcare systems
around the world, we aim to reduce disease
progression, hospital admissions and
premature deaths by half – enhancing the
lives of millions of people. We envision a
health system that is proactive and integrated
with patient‑centred care models. Our focus
is on four key areas of healthcare delivery:
•
proactive screening and early diagnosis
•
guideline adoption at the practice level
•
specialist pathways and personalised care
•
building resilient health systems.
Growth and Therapy Area Leadership
Actual growth
2024 +18%
2023 +3%
2022 +19%
CER growth
2024 +21%
2023 +6%
2022 +25%
Through partnering
with healthcare
systems from more
than 40 countries,
our practice-changing
initiatives have already
enabled millions more
people to gain access to
guideline-directed care.
For details of how Total
Revenue is considered when
calculating the annual bonus,
see from page 121.
For more information, see:
Therapy Area Review from
page 16.
Affordability and pricing on
page 52 and Operations from
page 41 of the Business Review.
Our Strategy and Key Performance Indicators
continued
14
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
86%
84%
86%
84%
84%
Employee belief that AstraZeneca
is a great place to work
1
2024
2023
2022
2024
25/27
2023
25/27
2022
7/9
Green
Amber
Red
25/27
25/27
Sustainability KPIs
performance
2
2024 developments
BV
•
We continued to invest in our people
to ensure we recruit, retain and develop
a talented workforce.
•
We continued to score highly in our
Pulse survey for questions relating to
our Purpose, direction, patient centricity
and employee commitment.
•
We continued to invest in global
collaborations, Group initiatives and local
partnerships to strengthen health
systems.
•
We maintained a leading role in industry
efforts to address the impact of climate
change and accelerate the delivery of
net‑zero healthcare, while improving
health outcomes and minimising our
environmental impact.
•
Our Ambition Zero Carbon strategy
delivered further reductions in our GHG
emissions across our operations –
Scopes 1 and 2 – and we made progress
on initiatives, including through supply
chain decarbonisation, as we work
towards achieving a 50% target reduction
in Scope 3 emissions by 2030.
•
We announced the completion of the
clinical programme for submissions in
Europe, UK and China to support the
transition of the first inhaled medicine
delivered by pressurised metered‑dose
inhaler (
Breztri
/
Trixeo
) to a next‑
generation propellant (NGP) with
near‑zero Global Warming Potential.
Key Performance Indicators
BV
Our People KPI is based on our Pulse
survey measure of those employees
who believe that AstraZeneca is a
great place to work.
Our Sustainability KPIs, including
climate‑related targets, reflect
our success in achieving our
sustainability goals. They are
based on nine focus areas that
have guided our sustainability
strategy since 2021.
Recognising the interconnection
between business growth, the needs
of society and our dependency on nature,
we promote health equity and resilient
healthcare, and play an active role
in addressing the climate crisis.
We cultivate an inclusive and diverse
work environment where employees can
thrive and are empowered to make an
impact for people, society and the planet.
Our strategic focus areas
Deliver a great employee experience
We are dedicated to being a great place to
work by maintaining employee engagement,
delivering our inclusion and diversity
strategy, and offering learning and
development programmes.
Lead on climate, equity and resilience
We are harnessing the power of science
and innovation in ways that positively
impact more patients and healthcare
systems while reducing our impact on
the environment.
We are working towards absolute
reductions in all our direct and indirect
GHG emissions sources across the value
chain – Scope 1, 2 and 3 – and decoupling
carbon emissions from revenue growth.
We are advancing our sustainability
priorities across the interconnected
dimensions of climate and nature, focusing
on mitigating the impacts of climate change,
restoring and protecting nature, building
resilient health systems and improving
health equity.
Enable an agile organisation
We are harnessing the potential of
technology, simplifying how we work and
scaling our business for the future.
For more information, see:
People and Sustainability
from page 47 of the
Business Review.
For more information on our
Sustainability KPIs, including
definitions, methodology and
restatements, see our
Sustainability Data Annex at
www.astrazeneca.com/
sustainability/resources.html.
People and Sustainability
Through science,
we can drive positive
change and help build
a healthier future for
people, society and
the planet.
1
Source: November Pulse survey
for each year.
2
In 2024, we assessed our performance
against 27 publicly available targets.
At least 90% of targets need to be
‘on plan’ or ‘target met’ to achieve a
rating of green; at least 70% for amber;
and red signifies any percentage
below this.
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Corporate Governance
Additional Information
Financial Statements
Strategic Report
Our Strategy and Key Performance Indicators
Redefine
cancer care
Oncology
Source: IQVIA.
AstraZeneca focuses on specific segments within this overall therapy area market. Oncology Therapy Area
submarket totals ($217.1bn) do not sum up exactly to the therapy area total ($218.8bn) due to rounding.
2024 overview
•
Commercial delivery and sales
performance driven by five
multiblockbuster medicines:
Tagrisso
,
Lynparza
,
Calquence
,
Imfinzi
and
Enhertu
.
•
Broad penetration of our Oncology
medicines with 22 major market approvals
across 15 indications.
•
First approval for our latest new medicine
Datroway
(Dato-DXd) in the US and Japan.
•
10 positive Phase III readouts across
multiple tumour types including lung,
breast, bladder, prostate and blood cancers,
including two from China-led trials.
Total Revenue
$22,353m
up 21% (24% at CER)
2023: $18,447m
2022: $15,539m
$65.0bn
Small molecule targeted agents
$52.6bn
Immune checkpoint inhibitors
$47.8bn
Monoclonal antibodies (mAbs)
$25.5bn
Chemotherapy
$21.0bn
Hormonal therapies
$4.0bn
PARP inhibitors
$1.2bn
Other oncology therapies
$218.8bn
Annual worldwide market value
Therapy area world market
(MAT Q3-24)
Therapy Area Review
Unmet medical need
and world market
2nd
Cancer is the second
leading cause of death
worldwide.
16.3m
By 2040, cancer is
expected to account
for 16.3 million deaths
annually across the globe.
Over 30m
The global burden of
cancer is expected to
grow, with over 30 million
newly diagnosed patients
estimated by 2040.
Two thirds of those patients
are expected to be in low-
to-middle income countries.
We are leading a revolution
to transform cancer care.
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Strategic Report
Our strategy in Oncology
Our ambition is to eliminate cancer as
a cause of death. We seek to transform
outcomes for people living with cancer
through innovative medicines, powerful
combinations and a world-class,
purpose-driven team.
Our commercial strategy to transform
patient outcomes centres on three
key areas:
•
Medicines that matter: building
transformative brands that raise the
standard of care for patients.
•
Leveraging scale: strengthening
leadership and expertise in key tumour
types (lung, haematology, genitourinary/
gynaecological, breast and
gastrointestinal).
•
Transforming patient care: closing the
care gaps to deliver optimal care for every
patient, improving access and building
more resilient healthcare systems
through partnerships.
Our R&D strategy focuses on these
key pillars:
1. Innovative science across seven
scientific platforms that attack cancer
from multiple angles:
a. Tumour drivers and resistance –
targeting genetic mutations and
resistance mechanisms that can
disrupt the ability of cancer cells to
survive and proliferate.
b. DNA damage response – targeting
the DNA repair process to block
cancer cells from reproducing.
c. Antibody drug conjugates (ADCs)
and radioconjugates – highly potent
cancer-killing agents delivered directly
to cancer cells via a linker attached to
a targeting molecule such as an
antibody, peptide or small molecule.
d. Epigenetics – targeting changes to
genome expression caused by cancer.
e. Immuno-oncology – activating the
body’s own immune system to help
fight cancer.
f. Cell therapies – harnessing living
cells to target cancer.
g. Immune engagers – redirecting the
immune system’s T-cells to the tumour
and amplifying that patient’s own
anti-cancer immune response.
2. Treating cancer earlier and smarter
with early detection and personalised
treatments.
3. Pioneering new technologies to help
us advance science and achieve the
next wave of breakthroughs.
Full details are given in the
Development Pipeline and
Patent Expiries of Key Marketed
Products Supplements on our
website, www.astrazeneca.
com/annualreport2024.
Key marketed products
Product
Disease
Total Revenue
Commentary
Tagrisso
(osimertinib)
Lung cancer
$6,580m,
up 13%
(16% at CER)
Approved in 112 countries for adjuvant early-stage EGFRm NSCLC and in 113 countries for 1st- and
2nd-line treatment of advanced EGFRm NSCLC. Approved in combination with chemotherapy in 1st-line
advanced EGFRm NSCLC in 27 countries and in several countries as a maintenance treatment after
definitive chemoradiation in unresectable Stage III EGFRm NSCLC.
Imfinzi
(durvalumab)
Lung cancer
Biliary tract cancer (BTC)
Liver cancer
Endometrial cancer
$4,717m,
up 17%
(21% at CER)
Approved in 97 countries in the curative-intent setting of unresectable, Stage III NSCLC and in
63 countries for metastatic NSCLC. Approved in nine countries for resectable NSCLC. Approved in
97 countries for extensive-stage SCLC and in three countries including the US for limited-stage SCLC.
Approved in 89 countries for locally advanced or metastatic BTC. Approved in 71 countries in combination
with
Imjudo
for uHCC and 33 countries as monotherapy. Approved in 36 countries for advanced or
recurrent endometrial cancer.
Calquence
(acalabrutinib)
CLL
MCL
SLL
$3,129m,
up 24%
(25% at CER)
Approved in 92 countries for the treatment of chronic lymphocytic leukaemia (CLL) and in 47 countries
for the treatment of adult patients with relapsed or refractory mantle cell lymphoma (MCL) who have
received at least one prior therapy; approved in the US for previously untreated MCL patients. Approved
in the US, Japan and China for small lymphocytic lymphoma (SLL).
Lynparza
(olaparib)
Ovarian cancer
Breast cancer
Pancreatic cancer
Prostate cancer
Endometrial cancer
$3,672m,
up 20%
(22% at CER)
Approved in 101 countries as maintenance therapy for platinum-sensitive relapsed ovarian cancer, 101
countries for 1st-line BRCAm ovarian cancer, and in 100 countries with bevacizumab for HRD-positive
advanced ovarian cancer. Approved in 101 countries for gBRCAm, HER2-negative early breast cancer and in
the metastatic setting in 86 countries. Approved in 99 countries for gBRCAm metastatic pancreatic cancer.
Approved in 101 countries for HRR gene-mutated mCRPC (BRCAm only in certain countries) and in 90
countries in combination with abiraterone for the 1st-line treatment of adult patients with mCRPC. Approved
in 31 countries as maintenance therapy in advanced or recurrent endometrial cancer that is pMMR.
Enhertu
(trastuzumab
deruxtecan)
Breast cancer
Lung cancer
Gastric cancer
Tumour agnostic
$1,982m,
up 54%
(58% at CER)
Approved in more than 75 countries for HER2-positive metastatic breast cancer following one or more
prior anti-HER2-based regimens. Approved in more than 70 countries for HER2-low metastatic breast
cancer following chemotherapy. Approved in more than 50 countries for previously treated HER2-
mutant metastatic NSCLC and in 60 countries for previously treated HER2-positive advanced gastric or
gastroesophageal junction adenocarcinoma. Approved in the US and several countries for previously
treated metastatic HER2-positive (IHC 3+) solid tumours. Also approved in the US for HR-positive,
HER2-low or HER2-ultralow metastatic breast cancer following one or more endocrine therapies.
Zoladex
(goserelin
acetate implant)
Prostate cancer
Breast cancer
$1,097m,
up 11%
(17% at CER)
Approved in 122 countries for the treatment of prostate cancer and in 64 countries for the treatment of
breast cancer in premenopausal women.
Imjudo
(tremelimumab)
Liver cancer
Lung cancer
$281m,
up 29%
(31% at CER)
Approved in 71 countries in combination with
Imfinzi
for unresectable HCC and in 63 countries in
combination with
Imfinzi
and chemotherapy for metastatic NSCLC.
Truqap
(capivasertib)
Breast cancer
$430m,
up $424m
Approved in more than 45 countries in combination with
Faslodex
for HR- or ER
-positive,
HER2-negative locally advanced or metastatic breast cancer with one or more biomarker alterations
(PIK3CA, AKT1 or PTEN) following recurrence or progression. Approved in Australia for HR-positive,
HER2-negative locally advanced or metastatic breast cancer following recurrence or progression.
Orpathys
(savolitinib)
Lung cancer
$46m,
stable
(up 2% at CER)
Approved in China and Macau for treatment of locally advanced or metastatic NSCLC with MET
gene alterations.
Datroway
(datopotamab
deruxtecan)
Breast cancer
n/a
Approved in the US and Japan for patients with previously treated metastatic HR-positive,
HER2-negative breast cancer.
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Financial Statements
Strategic Report
Therapy Area Review | Oncology
2024 review – strategy in action
Lung cancer
Scientific advances in early detection
and precision medicine are strengthening
the potential to offer meaningful patient
outcomes and long-term survival in lung
cancer. We have a comprehensive portfolio,
along with a promising pipeline of potential
new medicines and combinations across
diverse mechanisms of action. By 2030,
we aim to have an AstraZeneca medicine
for more than half of all patients treated
for lung cancer.
•
Tagrisso
is the world-leading third-
generation TKI and backbone therapy for
EGFRm NSCLC across multiple stages.
Across markets we see continued
demand growth for
Tagrisso
in both the
adjuvant and metastatic settings.
Tagrisso
with the addition of chemotherapy was
approved in more than 45 countries,
including the US, EU, China and Japan,
for the 1st-line treatment of adult patients
with locally advanced or metastatic
EGFRm NSCLC. Approvals were based
on positive results from the FLAURA2
Phase III trial, which showed
Tagrisso
in combination with chemotherapy
demonstrated a statistically significant
and clinically meaningful improvement
in PFS.
•
Positive results from the LAURA Phase III
trial showed
Tagrisso
demonstrated a
statistically significant and highly
clinically meaningful improvement in PFS
in patients with unresectable, Stage III
EGFRm NSCLC.
Tagrisso
is now approved
for these patients in the US, Switzerland,
the EU and China.
•
Since its first approval, more than
374,000 patients have been treated
with
Imfinzi
and it’s the only approved
immunotherapy in limited-stage SCLC
and the global SoC in the curative-intent
setting of unresectable, Stage III NSCLC
in patients whose disease has not
progressed after CRT.
Imfinzi
was
approved in the US and several other
countries for the perioperative treatment
of resectable, early-stage (IIa-IIIb)
NSCLC with no known EGFRm or ALK
rearrangements, based on the AEGEAN
Phase III trial.
•
Imfinzi
was approved in the US and
Switzerland and recommended for
approval in the EU for patients with
limited-stage SCLC whose disease had
not progressed following platinum-based
concurrent CRT based on the positive
ADRIATIC Phase III trial results.
•
Results from the ADJUVANT BR.31
Phase III trial showed
Imfinzi
did not achieve
statistical significance for disease-free
survival in early-stage (Ib-IIIa) NSCLC
after complete tumour resection in
patients whose tumours express PD-L1
on 25% or more tumour cells.
•
Final OS results were announced from
the TROPION-Lung01 Phase III trial which
showed a favourable trend in OS with
Datroway
in patients with previously
treated advanced or metastatic non-
squamous NSCLC. Data from TROPION-
Lung01 using a predictive computational
pathology biomarker was also presented
at the World Conference on Lung Cancer.
Ongoing Phase III trials in 1st-line NSCLC
have the potential to validate the use of
this patient selection biomarker.
Datroway
is jointly developed and commercialised
with Daiichi Sankyo.
•
Datroway
was granted Priority Review in
the US for the treatment of patients with
locally advanced or metastatic EGFRm
NSCLC who have received prior systemic
therapies, including an EGFR-directed
therapy, based on results from the
TROPION-Lung05 Phase II trial and
supported by data from the TROPION-
Lung01 Phase III trial. The companies
voluntarily withdrew an application in the
US, as well as the marketing authorisation
application in the EU, for
Datroway
for
patients with advanced or metastatic
non-squamous NSCLC.
•
Enhertu
is the first HER2-directed therapy
approved for patients with HER2-mutant
metastatic NSCLC. In 2024, it received
conditional approval in China in this
setting based on the DESTINY-Lung02
and DESTINY-Lung05 Phase II trials.
Enhertu
is jointly developed and
commercialised with Daiichi Sankyo.
Breast cancer
We are aiming to redefine clinical practice
and transform outcomes across all subtypes
and stages of breast cancer. Our portfolio
of approved medicines and promising
medicines in development leverage
different mechanisms of action to address
the biologically diverse breast cancer
tumour environment.
•
Enhertu
is the established SoC in
HER2-positive (DESTINY
-Breast03) and
HER2-low (DESTINY
-Breast04) metastatic
breast cancer. Positive results from the
DESTINY-Breast06 Phase III trial showed
that
Enhertu
provided a statistically
significant and clinically meaningful
improvement in PFS for patients with
HER2-low or HER2-ultralow metastatic
breast cancer who had received at least
one line of endocrine therapy.
Enhertu
is
now approved in the US in this setting
based on these results.
•
Continued strong demand growth with
strong uptake for
Truqap
worldwide in a
biomarker-altered subgroup of HR-positive,
HER2-negative metastatic breast cancer.
•
Truqap
was approved in the EU and
Japan in combination with
Faslodex
as
the first AKT-inhibitor for patients with
HR-positive, HER2-negative locally
advanced or metastatic breast cancer
with one or more biomarker alterations
(PIK3CA, AKT1 or PTEN) following disease
progression or recurrence, based on the
CAPItello-291 Phase III trial.
•
Truqap
in combination with paclitaxel did
not meet a primary endpoint of OS in the
CAPItello-290 Phase III trial in patients
with locally advanced or metastatic
triple-negative breast cancer.
•
The TROPION-Breast01 Phase III trial of
Datroway
versus chemotherapy, which
previously met the dual primary endpoint
of PFS, did not meet its OS endpoint in
patients with previously treated
metastatic HR-positive, HER2-low or
HER2-negative breast cancer.
Datroway
is approved in the US and Japan and
recommended for approval in the EU in
this setting.
•
Lynparza
remains the first-in-class PARP
inhibitor across four tumour types as
measured by total prescription volume,
achieving 10% growth in 2024 versus
2023, and is the only PARP inhibitor to
improve survival in early breast cancer.
Updated results from the OlympiA Phase III
trial showed
Lynparza
demonstrated
sustained, clinically meaningful
improvements in OS, invasive disease-
free survival and distant disease-free
survival at six years for patients with
germline BRCA-mutated (gBRCAm)
HER2-negative high-risk early breast
cancer.
Lynparza
was recently approved
in China for these patients.
Genitourinary/gynaecological cancers
In genitourinary cancers, we aim to
transform treatment paradigms with our
portfolio of approved medicines and a
diverse pipeline of innovative treatments
to help more patients. This includes
solidifying
Lynparza
plus abiraterone and
prednisone as a SoC in 1st-line metastatic
castration-resistant prostate cancer
(mCRPC) and aiming to bring
Imfinzi
as a
new treatment option for muscle-invasive
bladder cancer (MIBC). In gynaecological
cancers, we will continue to redefine
survival expectations, maximising
Lynparza
’s position as a SoC in advanced
ovarian cancer, and in combination with
Imfinzi
in endometrial cancer.
•
Imfinzi
and
Lynparza
were approved in
several countries for the treatment of
patients with advanced or recurrent
endometrial cancer based on the DUO-E
Phase III results:
–
In the US,
Imfinzi
with platinum-based
chemotherapy was approved as 1st-line
treatment followed by
Imfinzi
monotherapy for patients with
dMMR disease.
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continued
–
In the EU,
Imfinzi
plus chemotherapy as
1st-line treatment followed by
Lynparza
and
Imfinzi
has been approved for
patients with pMMR disease.
Imfinzi
plus chemotherapy followed by
Imfinzi
alone has also been approved for
patients with dMMR disease.
–
In Japan,
Imfinzi
with platinum-based
chemotherapy was approved as
1st-line treatment followed by
Imfinzi
monotherapy for patients regardless
of mismatch repair status.
Imfinzi
plus
chemotherapy as 1st-line treatment
followed by
Lynparza
and
Imfinzi
has
also been approved for patients with
pMMR disease.
•
Results from the NIAGARA Phase III
trial showed
Imfinzi
in combination
with chemotherapy demonstrated a
statistically significant and clinically
meaningful improvement in event-free
survival and OS for patients with MIBC.
It is now under Priority Review in the
US in this setting.
•
Positive results from the CAPItello-281
trial showed
Truqap
in combination with
abiraterone and androgen deprivation
therapy demonstrated a statistically
significant and clinically meaningful
improvement in radiographic PFS in
PTEN-deficient metastatic hormone-
sensitive prostate cancer (mHSPC).
Gastrointestinal cancers
We have a broad and robust portfolio and
development programme for the treatment
of gastrointestinal (GI) cancers in many
stages and disease types across multiple
approved and potential new medicines.
Imfinzi
in GI cancers was a major growth
driver in 2024, based on market approvals
in BTC (TOPAZ-1) and HCC (HIMALAYA)
worldwide.
•
Enhertu
received conditional approval in
China for patients with previously treated
HER2-positive advanced or metastatic
gastric cancer based on the DESTINY-
Gastric06 and DESTINY-Gastric01 trials.
•
Data from a Phase I trial of C-CAR31, a
novel autologous armoured Glypican 3
(GPC3) targeting chimeric antigen
receptor T-cell (CAR
-T) therapy, showed
encouraging safety and preliminary
efficacy results in patients with HCC.
Blood cancers
In haematology, we are unleashing the
potential of
Calquence
, the current SoC
in multiple forms of blood cancer, while
pushing the boundaries of science to
redefine care through ambitious clinical
development, deep clinical insights and a
focus on improving the patient experience.
•
Positive results from the AMPLIFY
Phase III trial showed a fixed-duration
of
Calquence
in combination with
venetoclax, with or without
obinutuzumab, demonstrated a
statistically significant and clinically
meaningful improvement in PFS in
previously untreated CLL.
•
Results from the ECHO Phase III trial
showed that
Calquence
plus
chemoimmunotherapy significantly
improved PFS as a 1st-line treatment
of patients with MCL.
Calquence
is
now approved in the US in this setting.
•
Early data from our novel CD19xCD3
bispecific T-cell engager, surovatamig,
(AZD0486) in follicular lymphoma and
diffuse large B-cell lymphoma showed
promising clinical efficacy and
safety profile.
Pan-tumour
Together with Daiichi Sankyo, we are
exploring the role of HER2-directed
therapies in treating multiple solid tumour
types. We see encouraging early uptake
for
Enhertu
following tumour-agnostic
approvals worldwide.
•
Enhertu
was approved in the US for
previously treated patients with
metastatic HER2-positive solid tumours
based on three Phase II trials (DESTINY-
PanTumor02, DESTINY-Lung01 and
DESTINY-CRC02) which showed clinically
meaningful responses across a broad
range of tumours. The approval marked
the first tumour-agnostic approval of a
HER2-directed therapy and an ADC.
The
transformative
potential of cell
therapies
Cell therapies are one of the transformative
technologies in which we are investing to
bring their curative potential to patients.
We accelerated their delivery with the
acquisition of Gracell, whose FasTCAR
platform significantly shortens
manufacturing time and aims to improve
the activity of therapeutic CAR-Ts, as well
as reduce treatment waiting times.
A collaboration with the Moffitt Cancer
Center is designed to accelerate our cell
therapy pipeline and we are also
progressing our T-cell receptor therapies
from our Neogene acquisition. We have
announced a new manufacturing facility
in Maryland, US, to expand capacity.
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Additional Information
Financial Statements
Corporate Governance
Therapy Area Review | Oncology
Our ambition is to transform care for billions
of people living with chronic diseases and
deliver long-lasting immunity. We are working
to intervene earlier to protect vital organs, slow
or reverse disease progression, and achieve
remission for often degenerative, debilitating
and life-threatening conditions, so many more
people can live better, healthier lives.
Transform
care for
billions
BioPharmaceuticals
Therapy Area Review
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Annual Report & Form 20-F Information 2024
Strategic Report
Total Revenue
$12,517m
up 18% (20% at CER)
2023: $10,628m
2022: $9,211m
Total Revenue
$7,876m
up 23% (25% at CER)
2023: $6,404m
2022: $5,963m
Total Revenue
$1,462m
up 8% (8% at CER)
2023: $1,357m
2022: $4,836m
Our ambition is to improve care to
save lives for the millions living with
cardiovascular, renal and metabolic
diseases, stop disease progression and,
ultimately, pave the way to a cure.
Our ambition is to transform respiratory
and immunology care for millions of
patients worldwide, moving beyond
symptom control to disease modification,
remission and, one day, cure.
Our ambition is to develop and deliver
innovative vaccines and antibodies to
protect patients from serious viral and
bacterial infections, providing
long-lasting immunity to millions.
Unmet medical need and world market
1.4 billion people
across the globe are affected by
CVRM diseases.
4 of the top 7
causes of death worldwide are predicted
to be CVRM diseases by 2040.
Unmet medical need and world market
~500 million
people worldwide have chronic
respiratory diseases, which carry a high
disease burden.
>40 million
people worldwide have the immune-
mediated diseases we are targeting,
with few achieving remission.
$4.8 trillion
the estimated global burden of chronic
obstructive pulmonary disease (COPD)
by 2050, a leading cause of hospital
admissions and the world’s third leading
cause of death.
¹
¹ Excluding COVID-19.
Unmet medical need and world market
~300,000
hMPV and RSV-related hospitalisations
combined among older adults in the US
each year.
One billion
cases of seasonal influenza annually.
Up to 4%
of the population is immunocompromised
and is at a higher risk of hospitalisation
from COVID-19 than the general
population.
2024 overview
•
Farxiga
retained its position as the
number one SGLT2 inhibitor worldwide
by volume, growing faster than the
overall SGLT2 market in all major
regions, driven by continued demand in
heart failure (HF) and chronic kidney
disease (CKD).
•
Wainzua
recommended for approval in
the EU for the treatment of adult patients
with polyneuropathy of hereditary
transthyretin-mediated amyloidosis.
•
The CVRM pipeline was bolstered by an
exclusive licence agreement with CSPC
Pharmaceutical Group Ltd. to develop
an early stage, novel small molecule
Lipoprotein (a) (Lp(a)) disruptor.
2024 overview
•
Achieved double-digit growth driven
by key launch brands (
Breztri
,
Fasenra
,
Tezspire
,
Saphnelo
,
Airsupra
).
Tezspire
secured blockbuster status with
combined sales recorded by Amgen
and AstraZeneca of $1.2 billion, of which
AstraZeneca recorded Total Revenue
of $684 million.
•
Progressed the late-stage portfolio
including four major market approvals
and four Phase II and Phase III data
readouts.
•
Submitted the first regulatory filings
to support the transition of
Breztri
to
next-generation propellant with near-zero
Global Warming Potential (GWP).
2024 overview
•
Completed the acquisition of Icosavax
enhancing late-stage pipeline with
potential first-in-class RSV/human
metapneumovirus (hMPV)
combination vaccine.
•
Beyfortus
demonstrated a 90% reduction
in RSV-related hospitalisations in its
first season. Following 2023 and 2024
approvals in the US and China,
Beyfortus
is now approved in 50 countries as the
first and only RSV lower respiratory tract
disease (LRTD) preventative option for
a broad infant population.
•
FluMist
was approved in the US as the
only influenza vaccine for self- or
caregiver-administration at home,
recognised in TIME Magazine 2024
Innovations of the Year.
Cardiovascular, Renal & Metabolism
Respiratory & Immunology
Vaccines & Immune Therapies
Corporate Governance
Additional Information
Financial Statements
Strategic Report
21
AstraZeneca
Annual Report & Form 20-F Information 2024
Therapy Area Review | BioPharmaceuticals
$194.1bn
Diabetes
$39.5bn
High blood pressure
$21.8bn
Abnormal levels
of blood cholesterol
$9.6bn
CKD
$7.2bn
Thrombosis
$5.0bn
CKD-associated anaemia
$1.0bn
Hyperkalaemia
$72.6bn
Other CV
$323.0bn
$323.0bn
Annual worldwide market value
Therapy area world market
(MAT Q3-24)
Our strategy in CVRM
Our ambition is to improve and save lives
for the millions of people who are living
with the complexities of CVRM diseases.
•
The impact of CVRM diseases on people,
society and our planet is immense and
growing, yet these diseases remain
underdiagnosed, undertreated, and their
interconnections under-recognised.
•
By 2040, it is expected that CVRM
diseases and comorbidities will account
for four of the top seven causes of death
globally (heart disease, diabetes, kidney
disease and stroke), and five of the top
eight leading risk factors of premature
death (high blood pressure, BMI, glucose,
cholesterol and impaired kidney function).
These are complex and interconnected
conditions, with the majority of patients
living with two or more of them.
•
We are building the broadest and deepest
pipelines through novel mechanisms and
combinations to:
–
Slow and stop cardiorenal disease
and protect vital organs.
–
Address major risk factors of
hypertension, dyslipidaemia and
obesity to help prevent them.
•
By understanding their interconnections
and targeting the mechanisms that drive
CVRM diseases, we will be able to detect,
diagnose and treat people earlier and
more effectively, stop disease
progression and, ultimately, pave the
way to a cure.
2024 review – strategy in action
Our strategy focuses on three areas:
cardiovascular, renal, and metabolic
diseases.
Cardiovascular (CV)
CV disease is the leading cause of death
worldwide. Our ambition is to reduce CV
disease by addressing risk factors such
as hypertension control and dyslipidaemia,
as well as treating CVRM comorbidities.
•
In February 2024, together with Ionis,
we received Fast Track designation in
the US for
Wainua
in the treatment of
transthyretin-mediated amyloid
cardiomyopathy of wild-type or
hereditary transthyretin-mediated
amyloidosis (ATTRv) in adults.
•
Wainzua
(
Wainua
in the US) was
recommended for approval in the EU for
the treatment of ATTRv in adult patients
with Stage 1 or Stage 2 polyneuropathy.
This follows the US FDA approval in 2023.
•
New real-world evidence demonstrated
the need for earlier diagnosis and rapid
initiation of guideline-directed medical
therapy in HF patients. REVOLUTION HF
showed that delayed diagnosis led to
increased hospitalisations, mortality rates,
and four-times higher healthcare costs.
•
Baxdrostat, an aldosterone synthase
inhibitor, has progressed into Phase III
trials for treatment-resistant and
uncontrolled hypertension. Targeting
aldosterone aims to reduce the risk of
Key marketed products
Product
Disease
Total Revenue
Commentary
Farxiga/Forxiga
(dapagliflozin)
Type 2 diabetes
(T2D)
Heart failure (HF)
Chronic kidney
disease (CKD)
$7,717m,
up 29%
(31% at CER)
Farxiga
continues to be the number one SGLT2
inhibitor worldwide by volume, growing faster
than the overall SGLT2 market in all major regions,
driven by continued demand in HF and CKD.
Brilinta/Brilique
(ticagrelor)
Acute coronary
syndromes (ACS)
$1,333m,
up 1%
(2% at CER)
Brilinta
plus aspirin is currently approved in
more than 124 countries for the prevention of
atherothrombotic events in adult patients with
ACS and in 80 countries for the secondary
prevention of CV events among high-risk patients
who have experienced a heart attack.
Crestor
(rosuvastatin calcium)
Dyslipidaemia
Hyper-
cholesterolaemia
$1,155m,
up 4%
(8% at CER)
Approved in 91 countries as an adjunct to diet
to reduce elevated Total-C, LDL
-C, ApoB,
non-HDL
-C, and triglycerides and to increase
HDL-C in adult patients with primary
hyperlipidaemia or mixed dyslipidaemia.
Seloken/Toprol-XL
(metoprolol succinate)
Hypertension
HF
Angina
$606m,
down 5%
(stable at
CER)
Approved in 62 countries to treat hypertension,
angina, cardiac arrhythmias and post-CV event
prophylaxis.
Lokelma
(sodium zirconium
cyclosilicate)
Hyperkalaemia (HK)
$542m,
up 32%
(34% at CER)
Approved in 56 markets and is market leader by
days-of-therapy volume in branded HK market
and the number one ranked K+ binder across
13 countries.
Roxadustat
Anaemia of CKD
$336m,
up 22%
(23% at CER)
Roxadustat is used to treat adults with
symptomatic anaemia associated with CKD.
Andexxa
/
Ondexxya
(andexanet alfa)
Factor Xa (FXa)
inhibitor reversal
agent
$219m,
up 20%
(22% at CER)
Andexxa
holds an accelerated approval in the US
and a conditional approval by the EMA for reversal
of the anticoagulant effect of FXa in patients with
life-threatening or uncontrolled bleeds. In the
third quarter of 2024, following a strategic review
of portfolio priorities, the business decision was
made to cease promotional activity for
Andexxa
.
Wainua
/
Wainzua
(eplontersen)
Polyneuropathy
of hereditary
transthyretin-
mediated
amyloidosis
(ATTRv-PN)
$85m
Approved in six countries, including in the US, for
the treatment of adult patients with stage one or
two ATTRv-PN.
Source: IQVIA.
AstraZeneca focuses on specific segments within
this overall therapy area market. Sales for CKD
($9.6bn) and CKD-associated anaemia ($5.0bn)
fall outside the CVRM total market. All sales for
CKD-associated anaemia ($5.0bn) fall within the
CKD market and should not be double counted.
Full details are given in the
Development Pipeline and
Patent Expiries of Key Marketed
Products Supplements on our
website, www.astrazeneca.
com/annualreport2024.
Cardiovascular, Renal & Metabolism
22
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
Therapy Area Review | BioPharmaceuticals
continued
mortality, cardiovascular outcomes,
and deterioration of kidney function
that is independent of blood pressure.
•
Balcinrenone/dapagliflozin aims to
address the unmet medical need in HF
patients with impaired kidney function
by delivering the benefits of
mineralocorticoid receptor antagonists
(MRAs) without hyperkalaemia risk.
The Phase III BalanceD-HF trial
commenced recruitment.
•
Our ambition is to lead dyslipidaemia
care, helping patients to reduce risk of
chronic CV disease. Our pipeline includes
AZD0780 (oPCSK9i) as an adjunct to
statins and in combination with other
lipid-lowering therapies. Phase II studies
of AZD0780 will complete and be
presented in 2025.
•
Our relaxin portfolio aims to improve
cardiac function by recapitulating the
biology of relaxin, a natural pregnancy
hormone, in patients with HF and
pulmonary hypertension (PH). AZD3427,
currently in Phase IIb trials, is a long-
acting peptide analogue of relaxin and
one of the first therapies to specifically
address group 2 PH, the largest PH
population, in HF. AZD5462 is the first
and only small molecule targeting relaxin
biology to enter clinical trials, currently in
Phase IIb. We are exploring its potential to
become a foundational therapy in a broad
range of patients with HF.
Renal
Nearly 850 million people worldwide are
affected by kidney disease. Our ambition
in CKD is to eliminate progression to
kidney failure.
•
In 2024, the Kidney Disease Improving
Global Outcomes CKD guidelines
included use of SGLT2s as a class 1a
recommendation for patients with CKD
regardless of T2D status, including use
in patients with CKD and HF.
•
New modelling analyses (IMPACT
CKD, DISCOVER CKD, PaCE CKD)
demonstrated the benefits of earlier
CKD diagnosis and access to guideline-
directed medical therapies for economies,
healthcare systems, and quality of life
for patients.
•
We are focusing on subpopulations
of patients with CKD in our clinical
development programme, with unique
mechanisms that target disease drivers
and risk factors that impact disease
progression, on top of the proven
cardiorenal protection of dapagliflozin.
•
Zibotentan/dapagliflozin has advanced
into Phase III ZENITH High Proteinuria for
patients with CKD and high proteinuria.
The combination is also being developed
in liver cirrhosis and entered Phase II
development with the ZEAL trial.
•
Baxdrostat/dapagliflozin has advanced
into Phase III BaxDuo Arctic for patients
with CKD and hypertension.
•
Balcinrenone/dapagliflozin has advanced
into Phase IIb MIRO-CKD for patients
with CKD at higher risk of developing
hyperkalaemia.
•
AZD2373, developed in collaboration
with Ionis, has the potential to be the first
precision medicine in our renal pipeline
for treatment of APOL-1 mediated kidney
disease (AMKD). Phase I data has
demonstrated safety, tolerability and proof
of mechanism in healthy participants.
Metabolism
Sixty per cent of people diagnosed with
obesity or as overweight (BMI >27kg/m
2
)
have at least one comorbidity.
•
We continue to build a comprehensive
weight management portfolio to deliver
durable weight management and to
provide organ protection. Three key
assets (AZD5004
(oral GLP-1RA),
AZD6234 (LA amylin) and AZD9550
(GLP-1/GCG RA)) delivered positive
Phase I data in 2024. We have entered
Phase II trials in T2D (AZD5004
SOLSTICE) and obesity (AZD5004 VISTA
and AZD6234 APRICUS studies). A triple
mechanism combination therapy
(AZD9550+AZD6234) is set to enter
Phase II in the first half of 2025.
•
We are also advancing an innovative
pipeline in metabolic dysfunction-
associated steatohepatitis (MASH)
and advanced liver disease to specifically
target the main disease drivers. This
includes a precision medicine approach
with AZD2693 (PNPLA3 ASO) in patients
with a genetic predisposition to MASH,
currently in Phase IIb studies, and
AZD2389 (small molecule FAP inhibitor)
targeting advanced liver fibrosis currently
in Phase II studies.
•
In June 2024, following the T2NOW
Phase III trial,
Farxiga
was approved by
the FDA to improve glycaemic control in
paediatric patients aged 10 years and
older with T2D.
Healthcare in the community
AstraZeneca is proud to support the
Everton in the Community (Everton
Football Club’s official charity) NexGen
Breathlessness Hub. The Hub enables
prompt review of people with chronic
breathlessness to establish a diagnosis,
such as heart failure or COPD. It serves
one of the most deprived UK
neighbourhoods, and its convenient
location in Everton’s ‘The People’s
Place’ embeds rapid, equitable access
to essential diagnostics in the community.
Over 1,000 people have received lung and
heart health checks, 25% underwent
NT-proBNP testing and AI-assisted
echocardiography to assess cardiac
function with ~3% newly diagnosed with
HF. There is a significant correlation
between deprivation levels and HF
hospitalisation and survival; providing rapid
diagnosis and early treatment could
improve long-term outcomes.
Corporate Governance
Additional Information
Financial Statements
Strategic Report
23
AstraZeneca
Annual Report & Form 20-F Information 2024
Therapy Area Review | BioPharmaceuticals | Cardiovascular, Renal & Metabolism
$29.7bn
Asthma
$17.1bn
COPD
$44.9bn
Other
$91.9bn
$91.9bn
Annual worldwide market value
Therapy area world market
(MAT
Q3-24)
Our strategy in R&I
Our ambition is to transform care in
respiratory and immune-mediated
diseases by moving beyond symptom
control to achieve disease modification,
remission and, one day, cures for millions
of patients worldwide.
COPD
We are working to eliminate COPD as a
leading cause of death, transforming care
through our broad portfolio by:
•
Driving timely diagnosis, optimising
therapeutic intervention and reducing
mortality by addressing
cardiopulmonary risk.
•
Advancing innovative medicines including
next-generation biologics and orals to
slow disease progression and reverse
the structural damage caused by COPD.
Asthma
We strive to eliminate asthma attacks and
achieve clinical remission by:
•
Reinforcing our anti-inflammatory reliever
inhaled portfolio as the backbone of care.
•
Driving towards clinical remission with
systemic biologics.
•
Introducing novel oral and inhaled
medicines to address patients who are
not controlled on SoC inhaled therapy.
Other Respiratory
We are moving beyond asthma and COPD
to address other respiratory diseases with
significant unmet medical need, including
severe viral lower respiratory tract disease,
non-cystic fibrosis bronchiectasis,
interstitial lung disease and idiopathic
pulmonary fibrosis (IPF).
Immunology
We aim to disrupt in immunology, redefining
treatment paradigms in areas of high unmet
medical need, moving to clinical remission
and eventually cure by:
•
Targeting underlying disease drivers in
lupus and related diseases to address
high unmet medical need at each stage
of the patient journey.
•
Exceeding current efficacy expectations
in established diseases with suboptimal
treatment outcomes through targeting
novel mechanisms and applying precision
medicine in diseases such as Crohn’s
disease and rheumatoid arthritis.
•
Accelerating transformative technologies,
such as complex biologics and cell
therapy, with the goal of moving
towards cure.
Sustainability
Within R&I, we are leading the way in
reducing the environmental burden of care
by driving improvements in patient outcomes
as well as transitioning to inhaled respiratory
medicines with a propellant that has
near-zero GWP.
Key marketed products
Product
Disease
Total Revenue
Commentary
Symbicort
(budesonide/
formoterol)
Asthma
COPD
$2,879m,
up 22%
(25% at CER)
Symbicort
continued its volume market leadership
as the number one inhaled corticosteroid (ICS)/
LABA combination globally and had significant
growth across Emerging Markets. It is the only
branded ICS/LABA approved in mild asthma as
an anti-inflammatory reliever in 47 countries.
Fasenra
(benralizumab)
Severe eosinophilic
asthma (SEA)
Eosinophilic
granulomatosis with
polyangiitis (EGPA)
$1,689m,
up 9%
(9% at CER)
Approved as an add-on maintenance treatment
for SEA in 83 countries including the US, EU,
Japan and now China. Also broadened the
population in the US and Japan to patients six
years and older. Expanded into immunology with
approvals in more than 35 countries including the
US, EU and Japan for the treatment of EGPA.
Pulmicort
(budesonide)
Asthma
COPD
Croup
$682m,
down 4%
(1% at CER)
Approved in more than 115 countries.
Breztri
/
Trixeo
(budesonide/
glycopyrrolate/
formoterol)
COPD
$978m,
up 44%
(46% at CER)
Approved in more than 80 countries, including the
US, EU, Japan and China. GOLD 2025 emphasises
the important role of fixed-dose triple therapy
1
,
particularly for reducing mortality, preventing
exacerbations and addressing CV risk. It also
highlights more direct pathways for patients to
get treated with triple therapy.
Tezspire
(tezepelumab)
Severe asthma
$684m,
up 98%
(99% at CER)
Approved in more than 60 countries including the
US, EU and Japan for the treatment of severe
asthma without biomarkers or phenotypic
limitations.
Saphnelo
(anifrolumab)
Systemic lupus
erythematosus
(SLE)
$474m,
up 69%
(70% at CER)
Approved for the treatment of SLE in more than
65 countries, including the US, EU and Japan.
First biologic to demonstrate sustained SLE
remission in a clinical trial over four years
compared to standard therapy; aligned with
updated 2023 EULAR recommendations, which
focus on remission as a treatment goal.
Airsupra
(albuterol/budesonide)
Asthma
$66m
The only FDA-approved short-acting beta2
-
agonist (SABA)/ICS anti-inflammatory rescue
treatment approved in asthma for the treatment
of symptoms and prevention of exacerbations.
The anti-inflammatory rescue approach is the
preferred treatment approach as recommended
by the Global Initiative for Asthma.
1
Global triple therapy market definition:
Breztri
, Enerzair, Trelegy, Trimbow.
Source: IQVIA.
AstraZeneca focuses on specific segments
within this overall therapy area market.
Full details are given in the
Development Pipeline and
Patent Expiries of Key Marketed
Products Supplements on our
website, www.astrazeneca.
com/annualreport2024.
Respiratory & Immunology
24
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
Therapy Area Review | BioPharmaceuticals
continued
2024 review – strategy in action
COPD
Breztri
remains the fastest-growing triple
inhaled therapy within the growing
fixed-dose combination triple class¹ across
major markets.
Breztri
has demonstrated
a reduction in mortality that has been
recognised in the 2025 Report published
by the Global Initiative for Lung Disease
(GOLD). In March 2024, we initiated the first
Phase III cardiopulmonary outcomes trial in
COPD, THARROS, to investigate
Breztri
’s
potential to improve cardiopulmonary
outcomes, including death from respiratory
and cardiac causes.
In the fourth quarter of 2024, we submitted
regulatory filings in the EU, UK and China to
support the transition of
Breztri
(marketed
as
Trixeo
in Europe) as the first medicine in
our inhaled portfolio to use our next-
generation propellant with near-zero GWP.
We remain on track to transition our
portfolio of inhaled respiratory medicines
delivered by pressurised metered-dose
inhalers (pMDIs) by 2030, as part of our
Ambition Zero Carbon strategy. While
pMDIs contribute less than 0.04% of GHG
emissions, AstraZeneca is committed to
significantly reducing this burden.
We have a robust late-stage biologics
programme in COPD: tozorakimab (Phase III
LUNA programme), which has a unique dual
mechanism of action targeting IL-33, plus
indication expansion opportunities with
Fasenra
(Phase III RESOLUTE trial) and
Tezspire
(Phase III trial planned). Our
innovative early pipeline in COPD is aimed
at reaching patients who will not have
access to biologics, but no longer respond
to inhaled therapy. AZD6793 is an oral
small molecule IRAK4 inhibitor in Phase I
development targeting key COPD disease
drivers triggered by bacterial and viral
infections, smoke and other
environmental factors.
Asthma
Airsupra
has had strong uptake in the US
as the first and only FDA-approved
anti-inflammatory rescue therapy that treats
symptoms and prevents exacerbations. In
October 2024, we announced that
Airsupra
demonstrated a statistically significant and
clinically meaningful reduction in the risk
of a severe exacerbation in patients with
intermittent or mild or persistent asthma
in the BATURA Phase III trial.
Symbicort
maintained its position as the
leading inhaled corticosteroid (ICS)/long
acting beta2-agonist (LABA) globally by
volume and value. Performance has been
driven by strong growth in Emerging
Markets, and resilient performance in the
US offset by generic erosion in the EU
and Japan.
Tezspire
continues gaining market share,
achieving labels for a broad population
of severe asthma patients, and securing
reimbursement globally. We also announced
positive high-level results from the Phase III
WAYPOINT trial studying
Tezspire
for the
treatment of chronic rhinosinusitis with
nasal polyps.
In 2024, US and Japan regulatory
authorities approved the paediatric
indication for
Fasenra
for SEA, in patients
as young as six years old. In August 2024,
we announced the approval of
Fasenra
for
SEA in China in people 12 years of age and
older based on positive results from the
MIRACLE Phase III trial.
Two Phase III pivotal trials, KALOS and
LOGOS are investigating
Breztri
in asthma.
Our early pipeline is exploring innovative
compounds including new modalities,
aimed at targeting key disease mechanisms:
•
AZD8630, an inhaled fragment antibody
(inhaled biologic) in Phase II in
co-development with Amgen, targets
thymic stromal lymphopoietin (TSLP).
•
Atuliflapon, an oral 5-lipoxygenase-
activating protein (FLAP) inhibitor in
Phase IIa, could offer an alternative for
uncontrolled patients before systemic
biologics.
•
AZD4604, an inhaled JAK1 inhibitor in
Phase IIa has the potential to block the
effects of T2-high pro-inflammatory
pathways (IL4/13, TSLP) and T2-lower
pathways (IL6, interferon).
Other Respiratory
The TILIA Phase III trial of tozorakimab in
severe viral lower respiratory tract disease
is ongoing.
AZD8965, an oral small molecule arginase
inhibitor, in Phase I for IPF has the potential
to stop disease progression by blocking
collagen synthesis, which is deposited in
the lungs of patients with IPF.
Immunology
Saphnelo
continues its rapid growth.
At the European Lupus Meeting 2024, we
announced results from a post-hoc analysis
of the Phase III TULIP programme in SLE
that showed 30% of patients treated with
Saphnelo
achieved remission using the
Definition of Remission in SLE (DORIS)
criteria. Phase III trials are ongoing exploring
Saphnelo
for SLE in China as well as globally
in lupus nephritis, cutaneous lupus
erythematosus, idiopathic inflammatory
myopathies, systemic sclerosis, and in
SLE for subcutaneous delivery.
For more information on:
pMDI inhalers, Scope 1 and 2
Decarbonisation levers,
Scope 3 Decarbonisation
levers and Transition risk and
opportunities, see Climate
Change from page 53.
Fasenra
is now approved for the treatment
of EGPA in more than 35 countries including
the US, EU and Japan, based on positive
results from the MANDARA Phase III trial.
Tezspire
is also being investigated in
eosinophilic oesophagitis, a chronic
inflammatory disease of the
gastrointestinal tract.
Compounds in early-stage clinical
development include three potential
first-in-class medicines:
•
AZD0120, a CD19xBCMA biCAR-T therapy
in Phase I that may lead to a complete
immune reset by targeting both B-cells
and plasma cells in SLE patients.
•
AZD7798, a CCR9-depleting mAb in
Phase II. CCR9 is the main chemokine
receptor for trafficking lymphocytes to
the small intestine and considered central
to the generation of small bowel
inflammation in Crohn’s disease.
•
AZD1163, a PAD2/4 inhibitor in Phase I
targeting the enzyme activity which
drives the autoimmune response leading
to inflammation and tissue damage in
rheumatoid arthritis.
25
AstraZeneca
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Corporate Governance
Additional Information
Financial Statements
Strategic Report
Therapy Area Review | BioPharmaceuticals | Respiratory & Immunology
Key marketed products
Product
Disease
Total Revenue
Commentary
Beyfortus
(nirsevimab)
Respiratory syncytial
virus (RSV)
$722m,
up 176%
(173% at
CER)
Approved in 50 countries. Commercialised in
collaboration with Sanofi in all territories except
the US where Sanofi has full commercial control.
Synagis
(palivizumab)
RSV
$447m,
down 18%
(14% at CER)
Available in more than 100 countries outside the
US. Sobi holds the US rights.
FluMist
(live attenuated
influenza vaccine)
Influenza
$258m,
up 14%
(10% at CER)
Approved in the US, EU and other countries.
Approved for self-administration in the US. Daiichi
Sankyo holds rights to
FluMist
in Japan.
COVID-19 mAbs
1
(tixagevimab and
cilgavimab, and
sipavibart)
COVID-19
$31m,
down 90%
(90% at CER)
Use of COVID-19 mAbs is extremely limited due to
the high prevalence of non-susceptible variants.
1
In 2024
Evusheld
was no longer a key marketed product.
Source: IQVIA.
AstraZeneca focuses on specific segments
within this overall therapy area market.
Therapy area world market
(MAT Q3-24)
$21.7bn
Annual worldwide market value
26
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
Our strategy in V&I
Our ambition is to develop innovative
vaccines and antibodies to protect
patients from serious viral and bacterial
infections. Our complementary approach
includes vaccines for broad populations
and antibodies for targeted patient groups
including the immunocompromised,
older adults and infants.
Vaccines
We are engineering next-generation
vaccines utilising innovations such as mRNA,
virus-like particles and bioconjugates. These
technologies have the potential to generate
potent and long-lasting immune responses
against viral and bacterial pathogens.
The acquisition of Icosavax included the
potential first-in-class combination RSV and
human metapneumovirus (hMPV) vaccine,
building on our expertise in RSV prevention
and accelerating our ambition to deliver a
portfolio of protective interventions to
address high unmet medical need in
infectious diseases.
The collaboration agreement with US-based
biotechnology company Omniose enabled
research vaccines for serious bacterial
diseases. AstraZeneca holds exclusive rights
to Omniose’s proprietary bioconjugation
platform for up to three years.
Antibodies
We are pioneering novel approaches to
develop highly-targeted, long-acting
antibodies, using several engineering
advances to isolate highly potent antibodies
to deliver protection to vulnerable patients,
including the immunocompromised, older
adults and infants.
2024 review – strategy in action
Our V&I strategy is focused on reducing
the burden of infectious diseases among
people at highest risk of more severe
outcomes. This includes patients that
we already serve, such as those with
chronic respiratory or CV disease whose
underlying condition may worsen due
to serious infection.
RSV
•
In February 2024, AstraZeneca
announced the successful completion of
the acquisition of Icosavax, a US-based
clinical-stage biopharmaceutical
company, including IVX-A12, a potential
first-in-class combination protein
virus-like particle vaccine which targets
both RSV and hMPV. These two viruses
are leading causes of severe respiratory
infection and hospitalisation in adults
60 years of age and older and those
with chronic conditions such as CV,
renal and respiratory disease.
•
Beyfortus
is a long-acting antibody
(LAAB), developed by AstraZeneca and
commercialised from an alliance with
Sanofi, using AstraZeneca’s YTE
extended half-life technology. In its first
year of implementation,
Beyfortus
has
demonstrated significant real-world
effectiveness, showing a 90% reduction
in RSV-associated hospitalisations across
multiple countries.
•
In March 2024,
Beyfortus
was approved
in Japan for the prevention of RSV LRTD
in all neonates, infants and children
entering their first RSV season, and the
prevention of RSV LRTD in neonates,
infants and children at risk of serious RSV
infection entering their first or second
RSV season.
Beyfortus
is now approved
in 50 countries, with further regulatory
applications currently under review.
•
2024 saw significant expansion of
Beyfortus
supply ahead of the 2024 to
2025 RSV season to meet global demand
through an expanded manufacturing
network, and a second manufacturing
filling line approved by regulatory
authorities in the US, Canada and Europe.
A third filling line was approved by the
EMA and is under review by the US FDA.
•
Since its initial approval in 1998,
Synagis
has become a global SoC for RSV
prevention and helps protect at-risk
babies against the virus. Our agreement
with Sobi for the rights to
Synagis
in the
US remains ongoing. As anticipated,
Synagis
demand decreased following
rapid adoption of
Beyfortus
.
Influenza
•
FluMist
is a live attenuated influenza
vaccine, given as an intranasal spray.
FluMist
is recommended as an influenza
vaccine option by the Advisory
Committee on Immunization Practices
and American Academy of Pediatrics.
•
In September 2024,
FluMist
was approved
in the US as the only self-administered
influenza vaccine. The US FDA approved
an expansion to those who can administer
FluMist
to include self-administration for
eligible 18 to 49 year olds or administration
by a caregiver for eligible two to 17 year
olds. The self-/caregiver-administration
option will be available as early as the
2025 to 2026 influenza season.
COVID-19
•
Kavigale
(sipavibart), our LAAB designed
to provide COVID-19 protection in
immunocompromised individuals,
received approvals in Japan and the EU.
Both approvals are supported by positive
data from the SUPERNOVA Phase III
COVID-19 prevention trial.
Full details are given in the
Development Pipeline and
Patent Expiries of Key Marketed
Products Supplements on our
website, www.astrazeneca.
com/annualreport2024.
Vaccines & Immune Therapies
Therapy Area Review | BioPharmaceuticals
continued
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Strategic Report
Additional Information
Financial Statements
Corporate Governance
Therapy Area Review | BioPharmaceuticals | Vaccine & Immune Therapies
•
2024 saw the withdrawal of marketing
authorisations globally for
Vaxzevria
, the
Oxford-AstraZeneca vaccine, concluding
AstraZeneca’s significant contribution to
the COVID-19 pandemic, with over three
billion doses made available across 180
countries, estimated to have saved over
six million lives.
Early science
Compounds in early-stage clinical
development include AZD5148, an anti-toxin
B neutralising mAb now in Phase I trials,
which may provide protection against
Clostridioides difficile (C. diff) infection,
a condition that can cause life-threatening
diarrhoea and intestinal inflammation.
Preclinical data for AZD5148 were presented
at the 34th European Congress of Clinical
Microbiology & Infectious Diseases and
IDWeek 2024.
In January 2025, the first patient was dosed
in the Staphylococcus aureus mAb
combination trial.
Delivering public
health impact
through reducing
the burden of
RSV in infants
The introduction of
Beyfortus
marked a
significant step forward in our ambition
to improve public health globally, as for
the first time we could protect a broad
infant population against RSV. While
our confidence in the value of RSV
prevention was underscored by our
extensive trial programme, real-world
data collected following our first season
surpassed all expectations, with ~90%
reduction in RSV hospitalisations seen
across many countries. Beyond its impact
on RSV, clinicians also reported a reduction
in all-cause hospitalisations, demonstrating
the value of RSV prevention with
Beyfortus
in not only reducing the burden on infants
and their families, but delivering against
our commitment to support sustainable
and resilient healthcare systems.
2024 overview
•
Delivering robust and sustainable growth since
AstraZeneca’s acquisition of Alexion.
•
Performance driven by durable growth in C5
inhibition, increased demand beyond complement
inhibition, as well as market expansion.
•
Advancing next wave of innovative therapies with
a focus on first- and/or best-in-class medicines
and new modalities with curative potential.
•
A continued focus in launching in new
countries globally and addressing underserved
rare populations.
•
Furthering a commitment to overcome societal
and policy challenges and improve health equity
for people living with rare diseases.
Total Revenue
$8,768m
up 13% (16% at CER)
2023: $7,764m
2022: $7,053m
Therapy Area Review
Transform
lives
Rare Disease
Alexion, AstraZeneca Rare Disease continues to build a
diversified pipeline across disease areas with significant
unmet medical need, using an array of innovative modalities,
while expanding our global geographic footprint.
Unmet medical need
and world market
400m
people around the world are living
with a rare disease.
<10%
of rare diseases have approved
treatment options.
>70
countries we are reaching with rare
disease treatments, with an ambition
to reach 100 countries by 2030.
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Strategic Report
Our strategy in Rare Disease
We are dedicated to improving the lives
of those living with rare diseases, and
the people who support them, through:
•
Building on our pioneering legacy of
innovation and diversifying our portfolio
to advance innovative therapies with a
focus on developing first- and/or
best-in-class medicines.
•
Investing in promising new and potentially
curative modalities including cell and
gene therapy.
•
Enhancing science-led innovation across
the enterprise to accelerate drug
development and delivery.
•
Bringing transformative medicines to new
markets, reaching more patients in a
sustainable and equitable way.
2024 review – strategy in action
Sustained leadership in complement
In 2024, we saw durable growth in our C5
franchise, driven particularly by demand
growth in neurology indications, including in
gMG and NMOSD. Additionally, we continue
to see successful conversion from
Soliris
to
Ultomiris
across indications.
gMG is a rare autoimmune disorder which
can impact mobility, speech and breathing,
and can occur at any age, but most
commonly begins for women before the
age of 40 and for men after the age of 60.
NMOSD is a rare and debilitating
autoimmune disease characterised by
unpredictable relapses that can lead to
permanent disability.
In March 2024,
Ultomiris
was approved in
the US for the treatment of adults with AQP4
Ab+ NMOSD. The FDA approval was based
on positive results from the CHAMPION-
NMOSD Phase III trial, in which zero
relapses were observed among
Ultomiris
-
treated patients.
Data presented at scientific congresses
throughout the year, including at the Annual
meetings of the American Academy of
Neurology and the European Academy of
Neurology, reinforce the long-term safety
and efficacy profiles of
Ultomiris
and
Soliris
,
and demonstrates how these medicines can
transform outcomes for rare neurological
diseases, including gMG and NMOSD.
Ultomiris
is also being investigated in
several disease areas in which the
complement pathway is thought to play
a role, including ongoing Phase III trials
in haematopoietic stem cell transplant-
associated thrombotic microangiopathy
(HSCT-TMA), cardiac surgery
-associated
acute kidney injury (CSA-AKI) and
immunoglobulin A nephropathy (IgAN).
HSCT-TMA is a potentially life
-threatening
complication of HSCT which in some cases
can be worsened by overactivation of the
complement system, believed to fuel
Key marketed products
Product
Disease
Total Revenue
Commentary
Ultomiris
1
(ravulizumab)
Paroxysmal nocturnal
haemoglobinuria (PNH)
Atypical haemolytic uremic
syndrome (aHUS)
Generalised myasthenia gravis
(gMG)
Neuromyelitis optica spectrum
disorder (NMOSD)
$3,924m,
up 32%
(34% at CER)
Approved in 70 countries for the treatment of patients with PNH and patients with aHUS, including the
US, EU and Japan.
Approved in 68 countries for the treatment of adult patients with gMG who are anti-acetylcholine
receptor antibody-positive (AChR Ab+), including the US, EU and Japan.
Approved in 61 countries for the treatment of adult patients with NMOSD who are anti-aquaporin-4
antibody-positive (AQP4 Ab+), including the US, EU and Japan.
Soliris
2
(eculizumab)
PNH
aHUS
gMG
NMOSD
$2,588m,
down 18%
(14% at CER)
Approved in 56 countries for the treatment of patients with PNH and patients with aHUS, including the
US, EU, Japan and China.
Approved in 46 countries for the treatment of patients with gMG who are AChR Ab+ including the US,
EU, Japan and China.
Approved in 47 countries for the treatment of adult patients with NMOSD who are AQP4 Ab+, including
the US, EU, Japan and China.
Strensiq
(asfotase alfa)
Hypophosphatasia
(HPP)
$1,416m,
up 23%
(24% at CER)
Approved in 60 countries for the treatment of certain patients with HPP, including the US, EU and Japan.
Koselugo
(selumetinib)
Neurofibromatosis type 1 (NF1)
Plexiform neurofibromas (PN)
$631m,
up 91%
(96% at CER)
Approved in 66 countries for the treatment of paediatric patients, including the US, EU, Japan and China.
Kanuma
(sebelipase alfa)
Lysosomal acid lipase
deficiency (LAL-D)
$209m,
up 22%
(24% at CER)
Approved in 51 countries, including the US, EU and Japan.
1
Ultomiris
Total Revenue includes revenue of
Voydeya
which commenced in 2024.
2
We continue to see successful conversion from
Soliris
to
Ultomiris
across indications.
Full details are given in the
Development Pipeline and
Patent Expiries of Key Marketed
Products Supplements on our
website, www.astrazeneca.
com/annualreport2024.
endothelial cell damage and the
development of TMAs. Survival and clinical
outcomes are poor, with a mortality rate of
>50% at one year post-HSCT, and currently
there are no approved treatments.
IgAN is a rare, chronic kidney disease that
begins when the body develops abnormal
IgA proteins that result in the build-up of
immune complexes in the kidneys, causing
damage. This can impact the ability of the
kidneys to function properly, resulting in
chronic kidney disease that can progress to
end-stage kidney disease. Approximately
25-30% of people with IgAN will progress to
end-stage kidney disease, or kidney failure.
Complement innovation beyond
Soliris
and
Ultomiris
We are developing a broad portfolio of
potential medicines that target various
components of the complement system,
with opportunities to pursue indications
across a wide range of therapeutic areas
of interest, including haematology,
nephrology and neurology.
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Additional Information
Financial Statements
Strategic Report
Therapy Area Review | Rare Disease
Our next-generation investigational ALP
replacement therapy, efzimfotase alfa,
is designed to help reduce the treatment
burden for patients via more convenient,
less frequent dosing.
Through patient-centred innovation,
three Phase III trials have been initiated to
evaluate efzimfotase alfa. These include:
paediatric patients who have not been
treated with
Strensiq
; paediatric patients
switching from
Strensiq
to efzimfotase alfa;
and adolescent and adult patients who have
not been treated with
Strensiq
.
Hypoparathyroidism (HypoPT)
In 2024, we acquired Amolyt Pharma,
expanding into endocrine disease and
extending our bone metabolism franchise
with the addition of eneboparatide, a
Phase III investigational parathyroid
hormone receptor 1 (PTHR1) agonist with a
novel mechanism of action designed to meet
key therapeutic goals for HypoPT. In patients
with HypoPT, a deficiency in parathyroid
hormone production results in significant
dysregulation of calcium and phosphate,
which can lead to life-altering symptoms
and complications, including CKD.
Encouraging Phase II data for eneboparatide
has demonstrated normalisation of serum
calcium levels as well as the potential to
eliminate dependence on daily calcium and
vitamin D supplementation. In adults with
chronic HypoPT and hypercalciuria, results
showed that eneboparatide normalised
calcium in urine. In addition, for patients
with HypoPT, eneboparatide preserved
bone mineral density, an important potential
benefit in patients with an increased risk of
osteopenia or osteoporosis. Data from the
Phase III trial are anticipated in 2025.
Neurofibromatosis Type 1 (NF1) Plexiform
Neurofibromas (PN)
NF1 PN is a rare, progressive, genetic
condition that involves the development of
non-malignant (non-cancerous) tumours
that may affect the brain, spinal cord and
nerves. NF1 affects an estimated 1.7 million
individuals worldwide, approximately 70%
of whom are adults. In 30-50% of patients,
tumours develop on the nerve sheaths
and may cause debilitating symptoms.
High-level results from the KOMET Phase III
trial with
Koselugo
demonstrated a
statistically significant and clinically
meaningful objective response rate
compared to placebo in adults with NF1
who have symptomatic, inoperable PN.
In January 2024,
Voydeya
(danicopan) –
our first-in-class oral Factor D inhibitor
– received its first-ever regulatory approval
in Japan, followed by additional approvals in
the US, EU and other countries.
Voydeya
is
approved as add-on therapy to ravulizumab
or eculizumab to address the needs of the
subset of patients (approximately 10-20%)
with PNH who experience extravascular
haemolysis while treated with a C5 inhibitor.
Approval was based on the positive results
from the pivotal ALPHA Phase III trial;
results from the 12-week primary
evaluation period of the trial were
published in The Lancet Haematology.
Through a global Phase III trial, we are
evaluating the efficacy and safety of
gefurulimab, an investigational bispecific
VHH antibody targeting C5, designed for
weekly subcutaneous self-administration,
in adults with AChR Ab+ gMG, and exploring
the ability to treat earlier-line and broader
gMG patient populations.
In January 2025, the vemircopan
(ALXN2050) Phase II development
programme was terminated. The decision
was based on safety and efficacy data from
P
hase II trials across multiple indications.
Expanding beyond complement
We have continued to expand our rare
disease focus with novel assets for
non-complement-mediated diseases
with a focus on first- and/or best-in-
class medicines.
Amyloidosis
Amyloidosis is a group of complex rare
diseases with significant unmet medical
need caused by abnormal proteins that
misfold and clump together to form amyloid
that deposits in tissues or organs, including
the heart. The build-up of these amyloids
can result in significant organ damage and
organ failure that can severely impact
quality of life and ultimately be fatal. We are
advancing one of the industry’s broadest
and fastest-growing amyloidosis pipelines
across our therapeutic areas, evaluating
a broad range of modalities to address
the two most common types of cardiac
amyloidosis.
Our portfolio includes two novel anti-fibril
depleters, anselamimab and ALXN2220,
that seek to address the most prevalent
amyloidosis cardiomyopathies, light-chain
amyloidosis and transthyretin amyloidosis,
respectively, by selectively binding to and
removing amyloid deposits. It also includes
acoramidis, a stabiliser designed to prevent
further breakdown of transthyretin (TTR)
proteins and their deposition in tissue.
Amyloid light-chain (AL) amyloidosis
AL amyloidosis occurs when defective
plasma cells in bone marrow produce
abnormal proteins which aggregate to form
toxic amyloid fibril deposits. Amyloid fibril
accumulation in organs, particularly in the
heart and kidneys, may cause systemic
and progressive organ damage and high
mortality rates caused most often from
cardiac failure.
Anselamimab is being investigated in a
Phase III clinical programme in patients with
AL amyloidosis. By removing amyloid fibrils
from affected organs, anselamimab has the
potential to be the first treatment to address
the devastating organ damage caused by
amyloidosis on top of SoC.
Transthyretin amyloidosis (ATTR)
ATTR cardiomyopathy (ATTR-CM) is a
systemic, progressive, debilitating condition
that can lead to HF. Median survival in
patients with advanced cardiomyopathy is
between one to two years from diagnosis.
Because the symptoms can be similar
to other diseases, there are frequent
misdiagnoses and ATTR-CM can often
go undetected.
ALXN2220 is an investigational mAb
designed to selectively bind to and remove
ATTR amyloid fibrils, with the potential to
reverse the course of disease. A Phase III
trial is underway evaluating ALXN2220 as
an add-on treatment to SoC in patients with
ATTR-CM. In September 2024, ALXN2220
was granted Fast Track Designation by the
FDA based on efficacy and safety data from
the positive Phase Ib trial, which were
published in the New England Journal of
Medicine, and additional non-clinical data.
We also hold an exclusive licence from
BridgeBio’s affiliate, Eidos, to develop and
commercialise acoramidis, an investigational,
next-generation, orally-administered,
highly-potent, small-molecule stabiliser of
TTR, in Japan. In February 2024, positive
high-level results from the Japan Phase III
trial of acoramidis in adults with ATTR-CM
showed consistency to those in the global
BridgeBio ATTRibute-CM Phase III trial,
including survival, cardiac-related
hospitalisations and other measures of
improved functions and quality of life at
30 months. In November 2024, BridgeBio
announced the US approval of acoramidis
for the treatment of adults with ATTR-CM.
Hypophosphatasia (HPP)
HPP is a rare, inherited and progressive
metabolic disease characterised by
defective mineralisation, impaired calcium
and phosphate regulation and non-skeletal
manifestations such as muscle weakness,
generalised fatigue and pain. HPP is caused
by deficient activity of an enzyme known
as alkaline phosphatase (ALP).
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continued
Genomic medicine and cell therapy
Supported by recent strategic acquisitions,
investments and collaborations, we are
advancing an industry-leading suite of
next-generation genomic medicines, cell
therapies and platforms, with the objective
to develop innovative therapies with improved
safety and efficacy profiles. This includes
filing an Investigational New Drug (IND)
Application for a potential first-in-class
gene therapy in a rare cardiovascular
disease and plans to expand clinical
investigations in cell therapy into rare
diseases in 2025.
Rare cancers
Rare cancers account for approximately a
quarter of cancer deaths and have a lower
five-year survival rate than most common
cancers, representing a significant unmet
medical need. We are partnering with
colleagues across AstraZeneca to follow the
science and identify opportunities where
we intend to leverage our expertise and
infrastructure to deliver transformative
outcomes for patients.
Expansion
into rare
endocrinology
We expanded our pipeline into rare
endocrinology with the acquisition of
Amolyt Pharma and the addition of
eneboparatide, a Phase III investigational
peptide. HypoPT is a rare disease
affecting over 200,000 people in the US
and EU, approximately 80% of whom are
women. Eneboparatide is a parathyroid
hormone (PTH) receptor 1 (PTHR1) agonist
with a novel mechanism of action rationally
designed to restore PTH function to
manage the symptoms of HypoPT, while
preserving kidney function and bone
health. Encouraging Phase II data supports
the potential for eneboparatide to lessen
the often debilitating impact of low
parathyroid hormone and avoid the risks
of high-dose calcium supplementation.
A commitment to health
equity in rare disease
Being born with a rare disease is
inherently inequitable. We are committed
to taking bold steps to overcome societal
and policy challenges and improve
health equity for people living with
rare diseases.
This includes improving access to care
and treatment. Rare disease patients –
regardless of where they live – face
significant obstacles to accessing quality
healthcare and treatment. We are
working to reduce these obstacles by
focusing on developing and delivering
new medicines, serving more patients
in more geographies as we grow our
global footprint, improving the reach
and diversity of our clinical trials, and
enabling access by bridging treatment
gaps with our alternative access
programmes.
It also includes reducing time to
diagnosis. Access to effective screening
and diagnostic tools remains inequitable
for many patients with rare conditions.
We are working to expand access to
screenings for newborn babies and
next-generation sequencing, to provide
needed answers more rapidly.
Corporate Governance
Additional Information
Financial Statements
Strategic Report
AstraZeneca
Annual Report & Form 20-F Information 2024
31
Therapy Area Review | Rare Disease
Delivering our strategic priorities
sustainably, supporting scientific
innovation and promoting
commercial excellence.
Our business is organised to deliver our Growth Through
Innovation strategy. The success of our functions is built
on recruiting, retaining and developing talented people.
Our key topics covered include
material sustainability topics,
which have been identified
through our double materiality
assessment, see page 60 for
more information.
Science and
Innovation
We are focused on science and
innovation, from discovery through to
development and life-cycle management,
and on transforming care and outcomes
for patients. We have three therapy
area focused R&D organisations –
Oncology, BioPharmaceuticals and
Rare Disease.
Key topics covered
Summary and performance indicators
Research & Development
Development pipeline overview
Sustainable innovation
BV
Patient safety and product quality
BV
Growth and Therapy
Area Leadership
We are focused on launching
medicines that deliver sustainable
growth and realising the potential
of our pipeline. Our Commercial
regions align product strategy
and commercial delivery while our
Operations function manufactures
and delivers our medicines.
Key topics covered
Summary and performance indicators
Sales and marketing
Operations
Business conduct
BV
IT and IS resources
Cybersecurity and data privacy
BV
Business development
People and
Sustainability
We are committed to our people,
ensuring that AstraZeneca remains
a great place to work. We promote
health equity and resilient healthcare,
and play an active role in addressing
the climate crisis. We operate in a
responsible and sustainable way to
build a healthy future for people,
society and the planet.
Key topics covered
Summary and performance indicators
BV
People
•
Talent attraction and retention
BV
Sustainability
•
Accessible and affordable healthcare
BV
•
Climate change
BV
• Pollution
BV
Material sustainability metric, is independently
assured by Bureau Veritas.
Strategic Report
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Business Review
Global reach and presence
2
4
5
6
7
8
9
10
3
1
4
1
2
5
3
18,400
(19%)
US
7,000
(7%)
Established Rest of World
37,100
(39%)
Europe
31,800
(34%)
Emerging Markets
Our Strategic R&D centres
1.
Gaithersburg, MD, US
2.
Boston, MA, US
3.
Cambridge, UK (HQ)
4. Gothenburg, Sweden
5.
Shanghai, China
Our Global hubs
1.
Guadalajara, Mexico
2.
San José, Costa Rica
3. Mississauga, Canada
4. Lisbon, Portugal
5.
Dublin, Ireland
6. Barcelona, Spain
7.
Warsaw, Poland
8. Bangalore, India
9.
Chennai, India
10. Kuala Lumpur, Malaysia
Operations sites
Employees by reporting region
1
16,300
employees across our
manufacturing sites
94,300
employees
44
countries of origin
represented in
executive levels
Strategic R&D centres
We have five global strategic R&D
centres that are the driving force of
our R&D strategy, leveraging cutting-
edge science and technology to
deliver life-changing medicines.
Operations
Manufacturing supports business
growth and pipeline development,
maintaining excellence in product
launch, quality and supply.
26
Operations sites
in 16 countries
202
successful
market launches
People
We have a global commitment to
inclusion and diversity.
15,200
R&D employees
across our global sites
Global hubs
Our network of 10 global hubs bring
together complementary capabilities,
skills and expertise to help build
resilience for the future.
1
Due to rounding, the sum of percentages
may not agree to totals.
47,200
Commercial
employees
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Corporate Governance
Additional Information
Financial Statements
Strategic Report
Business Review | Global reach and presence
39%
Discovery
and early-stage
development
61%
Late-stage
development
Research & Development
2024
2023
2022
10
6
6
NME Phase II starts/
progressions
10
10
2024
2023
2022
43
31
38
NME and major
LCM submissions
43
43
2024
2023
2022
14
24
23
NME and major LCM Phase III
investment decisions
14
14
2024
2023
2022
31
25
34
NME and major
LCM approvals
31
31
1
Thomson Reuters five-year impact factor score.
Science and Innovation
Performance indicators
Our Key Performance Indicators include
the measurement of Phase II and III pipeline
progressions, which are critical for ensuring
both near-term and long-term delivery. The
initiation of Phase II new molecular entities
(NMEs) is essential for maintaining the
robustness and stability of our pipeline.
Meanwhile, investments in Phase III are
focused on delivering near-term value.
Additionally, our submission and approval
metrics serve as indicators of our
innovation’s advancement in four major
markets: the US, EU, China and Japan.
Research & Development
In 2024, we continued to progress
our science and pipeline, committed
to early diagnosis and treatment,
improving our understanding of
disease biology and advancing
our scientific modalities across
disease areas.
Summary and
performance indicators
We are using our scientific
capabilities and focusing on
transformative science to
accelerate the delivery of high
quality, life-changing medicines.
Our performance in 2024
•
Invested $13.6 billion in our R&D.
•
Three first approvals for new medicines.
•
74 regulatory events and 24 pipeline
progressions.
•
191 pipeline projects, of which 169 are
in the clinical phase of development.
•
More than 2,000 people working in
The Discovery Centre in Cambridge, UK.
•
Published 1,223 manuscripts with 175 in
‘high-impact’ journals.
•
Invested in new technologies and
modalities such as cell therapies,
genomic medicines and radioconjugates.
Our R&D resources
Our strategic R&D centres
As we deliver on our strategy, we are
focused on maximising our investment in
science and innovation, embracing new
ways of working to become even more
productive, and have a bigger impact on
people, society and the planet. Our five
strategic R&D centres are the driving force
of our strategy, our science and our
long-term success. We are also investing
in a network of global hubs to ensure we
are best positioned to deliver our
Ambition 2030.
Further expanding our footprint opens new
opportunities for us around the world and
provides greater access to the talent and
capabilities we need to achieve our growth
ambitions. We are creating sustainable,
digitally-enabled workplaces of the future,
designed to inspire and motivate people to
produce their most innovative work.
Investing in R&D
In 2024, R&D expenditure was
$13,583 million (2023: $10,935 million;
2022: $9,762 million), including Core R&D
costs of $12,211 million (2023: $10,267
million; 2022: $9,500 million). In addition,
we spent $2,226 million on acquiring
product rights (such as through in-licensing)
(2023: $2,530 million; 2022: $2,051 million).
We also invested $275 million in the
implementation of our R&D restructuring
strategy (2023: $212 million; 2022:
$111 million). Allocations of spend by
early- and late-stage development are
shown in the chart to the left.
Our R&D in 2024
In 2024, we continued to focus on key areas
of transformative science. Our scientists
published 1,223 manuscripts with 175 in
‘high-impact’ peer-reviewed journals, each
with an impact factor exceeding 15.
1
The
ongoing high impact continues to reflect the
quality of, and drive to share, our science.
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continued
Enhancing our understanding
of disease biology
Advancing our understanding of disease
biology is helping uncover novel drivers for
the diseases we aim to prevent, treat and
even cure. Selecting the right target remains
the most important decision in drug discovery.
2024 developments included:
•
Through the Centre for Genomics
Research, we leveraged clinical and
genetic data from 1.4 million people to
enable 60 novel hypotheses, 16 new
target selections and 50 pipeline
decisions. On track for two million
people by 2026.
•
Published several high-impact papers
showcasing how multi-omic data impacts
our understanding of disease biology and
enables the advancement of our pipeline,
for example by helping us better segment
diseases such as prostate cancer.
•
Developed the first genome-wide CRISPR
activation screen at the Functional
Genomics Centre to identify
overexpression genes that drive
resistance to
Enhertu
.
•
Opened a genomic medicine research
centre in Cambridge, Massachusetts,
US, to advance our pipeline of
genomic therapies.
Creating the next generation
of therapeutics
We continue to expand our modalities
across therapy areas and design new ways
of targeting drivers of disease with novel
platform technologies such as cell therapies
and T-cell engagers, biologics, including
antibodies or their fragments, ADCs and
radioconjugates. We are also progressing
a pipeline of genomic medicines and
innovative small molecules, including
oligonucleotides and PROTACs.
2024 developments included:
•
Accelerated our cell therapy strategy
with the acquisition of Gracell, including
AZD0120 (BCMAxCD19 CAR-T) for
haematologic and immune-mediated
diseases. Initiated Phase I study in
refractory systemic lupus erythematosus
(SLE) patients in China. Presented early
clinical data at ASCO for AZD7003
(GPC3 CAR-T) which is being co
-
developed with AbelZeta in solid tumours,
and developed a collaboration with
Moffitt Cancer Center to accelerate
our oncology cell therapy pipeline.
•
Advanced first next-generation CD8+
guided T-cell engager designed using
our proprietary Target Induced
T-cell Activating Nanobody (TITAN)
platform into the clinic (AZD5492:
CD20xCD8xTCR) in R/R B-cell
malignancies.
•
Showcased proprietary ADC technology
with promising first clinical data at ESMO
for AZD8205 (B7H4 Top1i) and AZD5335
(FRα Top1i).
•
Accelerated pipeline of actinium-based
radioconjugates through the acquisition
of Fusion, including Phase II FPI-2265
targeting prostate-specific membrane
antigen in prostate cancer.
•
Expanded CVRM portfolio via
collaboration with SixPeaks Bio and
in-licensing deal with CSPC, and
advanced early clinical development for
three novel therapies that could transform
weight management and interconnected
CVRM diseases.
•
Expanded into rare endocrinology with
Amolyt Pharma acquisition and
eneboparatide (AZP-3601), a Phase III
novel parathyroid hormone receptor 1
(PTHR1) agonist in hypoparathyroidism.
Better predicting clinical success of our
candidate drug molecules
We are adopting a range of cutting-edge
technologies, generating data that are more
relevant to patients than previous methods,
to help us predict the clinical effectiveness
of our candidate drug molecules.
2024 developments included:
•
Advanced genomic medicine in rare
diseases with enhanced precision gene
editing using novel CRISPR enzyme,
ePsCas9, published in Nature
Communications.
•
Unveiled MILTON, a cutting-edge machine
learning genomics research tool with
potential to accelerate target discovery
and advance early disease detection.
•
Advanced integration of AI into biologics
drug discovery, with 85% of our small
molecule and PROTAC projects being
already AI assisted.
•
Developing advanced organoids to model
kidney disease in collaboration with
Center for iPS Cell Research and
Application (CiRA), Kyoto University
and Rege Nephro Co., Ltd.
•
Collaborating with Novoheart, a wholly-
owned subsidiary of Medera Inc, to
develop an innovative cardiac screening
platform using bioengineered human
cardiac tissue strips that can advance
research and drug development.
•
Demonstrated that our novel
computational pathology-based TROP2
biomarker was predictive of clinical
outcomes in patients with non-small
cell lung cancer at WCLC Presidential
Symposium, and announced the
extension of our collaboration with Roche
Tissue Diagnostics to co-develop and
commercialise the companion diagnostic.
Pioneering new approaches to
engagement in the clinic
We are pioneering clinical innovation to
design and deliver patient-centric clinical
trials that improve the patient and site team
experience while optimising the use of data,
digital technologies and AI to improve patient
outcomes in clinical trials and beyond.
2024 developments included:
•
Collaborated with the Karolinska Institute
to advance positron emission tomography
(PET) tracer as a non-invasive clinical
imaging tool to monitor Crohn’s disease
treatment response.
•
Commercialised Evinova, with multiple
contracts in place including Parexel and
Fortrea, empowering the industry to
accelerate better health outcomes with
digital solutions to optimise clinical
development.
•
Implemented clinical trial simulations to
identify and address potential barriers to
help reduce the burden of participation and
improve protocol adherence, including
informed protocol changes, mitigation
plans and enhanced support services.
•
Advanced collaborations to bring to
market novel AI Software as a Medical
Device to improve diagnosis of rare
diseases, including with InVision
(cardiac amyloidosis).
•
Announced collaboration with ImmunAI to
generate and contextualise data through
a single cell multi-omics platform, with the
aim of better informing patient selection.
•
Delivered BATURA, the first fully
decentralised trial for asthma, which
employed approaches including 100%
virtual clinic visits and home delivery of
study medication, to reduce patient burden
to significantly accelerate trial recruitment
and expand trial access to a broader
patient population.
For more information on
Fusion, Amolyt Pharma and
CSPC deals, see Business
development on page 46.
35
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Business Review | Science and Innovation
Phase I
1
Phase II
1
Late-stage
development
1
Life-cycle management
projects
2
54%
Oncology
13%
CVRM
13%
R&I
10%
V&I
8%
Rare Disease
3%
Other
39
39
44%
Oncology
28%
CVRM
16%
R&I
3%
V&I
3%
Rare Disease
6%
Other
32
32
53%
Oncology
16%
CVRM
13%
R&I
3%
V&I
16%
Rare Disease
0%
Other
38
38
73%
Oncology
1%
CVRM
17%
R&I
0%
V&I
9%
Rare Disease
0%
Other
82
82
Science and Innovation
1
Includes NMEs and additional indications if the lead is not yet launched.
Due to rounding, the sum of percentages may not agree to totals.
2
Only includes major LCM projects.
Investing in transformative R&D technologies
Development pipeline overview
2024 was another remarkable year.
We achieved 74 regulatory events,
either submissions or approvals for
our medicines in major markets,
including three NME first approvals.
This success is supported by a robust
pipeline of promising medicines. We had
24 significant pipeline progression events,
including NME Phase II starts and Phase III
investment decisions, showcasing our
potential for sustainable growth.
Our pipeline comprises 191 projects, with
169 in the clinical phase of development.
We have 19 NME projects in pivotal trials
or under regulatory review, up from 17 at the
end of 2023. In 2024, 27 NMEs progressed
to their next development phase, while 17
projects were discontinued: 10 due to safety
or efficacy and seven due to strategic shifts.
Accelerating our pipeline
We are prioritising our investment in
specific programmes, focusing on scientific
innovation. This has led to receiving 23
Regulatory Designations for Breakthrough
Therapy, Priority Review, Accelerated or
Fast Track for 17 new medicines which offer
potential to address unmet medical need in
certain diseases. We also secured Orphan
Drug Designation for the development of
two medicines to treat rare diseases and
Qualified Infectious Disease Product
Designation for three projects.
Antibody drug conjugates
and radioconjugates
Building on antibody drug conjugate
(ADC) technology, our vision is for
ADCs and radioconjugates to become
the backbone of novel cancer therapies,
including combination approaches, by
improving and, in some cases, replacing
current chemotherapy and radiotherapy
treatments. Radioconjugates have
emerged as a promising modality in
cancer treatment, aiming to deliver
a DNA-damaging radioactive isotope
directly to cancer cells, to provide a
more precise mechanism of killing
cancer cells.
For more information, see
Therapy Area Review from
page 16.
We have also begun to identify
complementary mechanisms between
modalities to help develop effective,
transformative combinations of ADCs,
radioconjugates, and next-generation
immuno-oncology medicines. We are
working to use these regimens to treat
earlier stages of cancer, where there is the
greatest potential for deeper and durable
responses for some patients. As such,
we are building our oncology portfolio
with a multitude of diverse mechanisms
that can effectively combine to deliver
these transformative regimens.
36
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
Business Review
continued
Sustainable innovation
We are focused on accelerating the
delivery of life-changing medicines
that create enduring value, pushing
the boundaries of science to discover
innovations that transform and
sustain health.
BV
In our Code of Ethics, we outline our belief
that science is at the core of everything we
do; it is the heart of our business and our
Values. By leading in science, we improve
the lives of patients around the world. We
conduct innovative research, development
and manufacturing to high standards of
ethics and integrity everywhere we operate,
following the laws, regulations, codes,
guidelines, and good practice standards
related to safety, quality, research and
bioethics. Our holistic health equity strategy
is built on science and embedded across
the entire R&D process. We are committed
to improving diversity through inclusive and
accessible studies, to develop innovative
medicines that work for all patient groups.
We are also strengthening the research
ecosystem by increasing the breadth and
diversity of human data, and sharing our
science and capabilities with researchers,
recognising that scientific breakthroughs
only happen through open collaboration.
Pipeline governance
The pipeline governance and review
processes follow AstraZeneca’s Product
to Patient (P2P) Pathway. The P2P Pathway
comprises vital investment decisions and
other key development milestones from
the Candidate Drug Investment Decision to
health authority approval. The framework
relies on empowered teams supported by
cross-functional governance committees
and review bodies to enable investment
decisions and optimise clinical delivery
to advance the pipeline, to the benefit
of both patients and AstraZeneca.
These committees, comprised of executive
and senior leaders, play an integral role in
a range of key decisions throughout the
development pathway. Presentations to the
committees are given to enable the right
decisions at any given stage. Key decision
factors include R&D resource allocation,
based on overall therapeutic considerations
and strategy.
The P2P Pathway is managed by the Pipeline
and Portfolio Operations team within Global
Portfolio and Project Management.
The Early-Stage Product Committee and
Late-Stage Product Committee are
governance advisory bodies that review,
debate, endorse and make recommendations
in support of investment decisions.
Our drug discovery and development is
informed by our 5R Framework – (right
target, right patient, right tissue/right
exposure, right safety, right commercial
potential) which champions quality over
quantity and has helped transform the
For more information, see:
Life-cycle of a medicine,
page 11.
Standards and policies,
including Code of Ethics,
page 42.
Material sustainability metrics
associated with Sustainable
innovation, page 234.
Accessible and affordable
healthcare on page 52, for
more information on IP.
Details of the Science
Committee’s activities during
2024, page 102.
Screening for better patient outcomes
Up to 59% of patients attending
lung cancer screening programmes
globally have evidence of COPD and
many are missing opportunities for
earlier diagnosis, treatment and
participation in clinical research. As a
pilot, we collaborated with two National
Health Service sites in the UK delivering
targeted lung health checks to a general
population to determine if we could
identify more patients with COPD and
increase enrolment in our Phase II COPD
trial (CRESCENDO). As a result, 33%
(17 of 51), of those randomised for the
CRESCENDO trial in the UK were
identified directly from targeted lung health
checks, triple the average site randomisation
rate for the study from other sources (such
as referral from primary care physicians).
Based on this successful pilot, we are
scaling the initiative more broadly in the
UK and expanding to the US and Canada
to accelerate clinical trial delivery and
broaden diversity of participants within our
studies, also helping identify undiagnosed
symptomatic patients with COPD within
this high-risk group to support optimised
intervention with guidelines-based therapy.
culture of R&D and our business. Looking at
our productivity and success rates over the
past five years we can see a transformation
in our productivity, enabling us to discover
more innovative therapies for patients than
ever before.
Intellectual property
IP rights provide the incentives our industry
needs to do R&D that leads to new medicines.
Developing a drug is a long process and
bringing a new drug to market is typically
a lengthy and cost-intensive process,
considering the cost of failures. Thousands
and sometimes millions of compounds may
be screened and assessed early in the R&D
process to get the few that will ultimately
receive regulatory approval. AstraZeneca
innovates to make discoveries that improve
patients’ lives and may one day eliminate
disease altogether. The ability to obtain and
maintain patent protection, under a robust
IP protection and enforcement framework,
is an important part of a sustainable
framework for innovations in R&D that
result in life-changing medicines.
Corporate Governance
Additional Information
Financial Statements
Strategic Report
37
AstraZeneca
Annual Report & Form 20-F Information 2024
Business Review | Science and Innovation
49
inspections from all
health authorities
relating to Good
Manufacturing
Practice (GMP)
Seven
product recalls
Zero
critical findings
from health
authorities relating
to GMP
Patient safety and product quality
Our business model requires the
supply of safe and high-quality
medicines, which are constantly
and carefully monitored during their
entire life-cycle. We are dedicated
to patient safety and base our
behaviours and decisions on our
belief that everyone deserves to
have confidence in the safety, quality
and efficacy of our medicines.
BV
Science and Innovation
Pharmacovigilance
We have a comprehensive
pharmacovigilance programme which
constantly monitors all products throughout
their life-cycle. Our pharmacovigilance system
follows global regulatory requirements, GxP
principles and quality management standards.
For all our medicines, including those under
development as well as those on the market,
we have systems and processes in place for
identifying and evaluating possible adverse
drug effects. Information concerning the
safety profile of our medicines is provided
to regulators, healthcare professionals and,
where appropriate, patients. Each medicine
has a dedicated safety team, which includes
a responsible global safety physician and
one or more pharmacovigilance scientists.
Marketing companies have assigned patient
safety directors in place.
AstraZeneca Medical is a public website
to report on adverse events (AEs) or ask for
medical information. We actively promote
these communication channels with all our
key stakeholders, including healthcare
providers and patients, through our
Commercial teams and at congresses.
For this purpose, personal data that could
be used for identification will be added
as a pseudonym, according to legal
requirements, when added to our AE
database. Our Privacy Policy outlines
how AstraZeneca handles the processing
of personal information when dealing with
any enquiry, complaint or AE report.
AstraZeneca employees, as well as
contractors and third-party employees
who sign a contract with AstraZeneca, are
obliged to collect and report AEs involving
AstraZeneca products or partner products,
to ensure that the Company complies with
regulations and/or contractual requirements
and fulfils the mission of protecting patients.
AE training on what and how to report is
given to new hires and regularly repeated
to employees.
Patient safety
The Global Patient Safety organisation is
part of the Chief Medical Office and has
product responsibility from the time of
initial development all the way through to
the end of the life-cycle. Two major areas
of accountability include clinical safety
strategies for investigational and marketed
products and activities linked to our licence
to operate. Clinical safety strategy involves
the anticipation and prioritisation of potential
safety concerns, understanding their
possible consequences and the proactive
development of appropriate management
plans to address these.
Licence to operate includes collecting
and processing safety data from various
sources, performing comprehensive safety
surveillance, providing both individual case
reports and summary periodic safety reports
to various health authority stakeholders, on
time and to a high quality. Health authorities
globally conduct regular inspections of the
AstraZeneca pharmacovigilance system to
check and ensure robustness of processes
and technology tools. Feedback from
inspections supports continuous
improvement of the pharmacovigilance
system. As part of our commitment to
patient safety, we continue to develop the
capabilities of the patient safety team, and
refine our processes, systems and tools.
This includes exploring the use of emerging
technologies, such as automation support,
machine learning and digital communication
interfaces which have the potential to
further enhance our product safety
evaluation, communication and risk
mitigation capabilities.
Product quality
Our Operations Quality function has the
remit of GMP/Good Distribution Practice
(GDP) quality oversight from clinical and
commercial product manufacturing and
throughout the further life-cycle of a
product. Operations Quality is accountable
for ensuring all manufacturing, testing and
distribution, whether internal or through
our contract manufacturing organisations,
is carried out following all applicable
GMP/GDP regulations, to ensure the highest
levels of product quality and protect our
licence to operate. The function ensures
continuous improvement of our Quality
Management System (QMS) via multiple
mechanisms such as Corrective and
Preventative Actions, Risk Management
and Internal Audits. Periodic Quality
Management reviews are performed at
all management levels of the Operations
organisation to ensure QMS performance,
issue awareness and action accountability
are maintained in alignment with
management responsibilities. Product and
process performance assessments are
executed to review, evaluate and investigate
product and process data and customer
feedback. This ensures the identity, quality,
durability, reliability, usability, safety, efficacy
and performance of our products all meet
our quality standards throughout the
product life-cycle. We have a process for
issue management in place to address
quality issues affecting patients, products
or processes, where we escalate,
communicate, and take appropriate actions
as required by regulations and in a timely
manner. In 2024, we carried out seven
recalls of our products, none of which
were at the patient level.
Ensuring quality and compliance
As outlined in our Code of Ethics in Standards
and policies on page 42, we are committed
to high ethical standards. As members of the
Biotechnology Innovation Organization,
International Federation of Pharmaceutical
Manufacturers and Associations and the
European Federation of Pharmaceutical
Industries and Associations (EFPIA), we
adhere to their codes.
The development, product licensing,
manufacture, distribution and monitoring
of active pharmaceutical ingredients (APIs),
medicinal products and devices by the Group
must be conducted in compliance with
relevant international codes and standards,
regulations for Good Pharmaceutical
Practices (GxP), including GMP, Good
Pharmacovigilance Practices and
AstraZeneca Good Regulatory Practice.
Health authorities regularly carry out
inspections and in 2024, 49 GMP
inspections were carried out. No critical
findings related to GMP were identified
in AstraZeneca’s operations.
For more information, see:
Standards and policies, including
Code of Ethics, page 42.
Cybersecurity and data privacy,
see page 45.
38
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
Business Review
continued
Actual growth
2024 +22%
2023 +6%
2022 +47%
CER growth
2024 +22%
2023 +6%
2022 +47%
2024
2023
2022
$19,077m
$17,920m
$23,235m
US
$23,235
m
$23,235m
Actual growth
2024 +27%
2023 +10%
2022 +9%
CER growth
2024 +26%
2023 +8%
2022 +21%
$9,611m
$8,738m
$12,188m
Europe
2024
2023
2022
$
12,188m
$12,188m
Actual growth
2024 +14%
2023 +2%
2022 -4%
CER growth
2024 +22%
2023 +9%
2022 +1%
$12,025m
$11,745m
$13,675m
Emerging Markets
2024
2023
2022
$
13,675m
$13,675m
Actual growth
2024 -2%
2023 -14%
2022 +22%
CER growth
2024 +3%
2023 -8%
2022 +40%
2024
2023
2022
$5,099m
$5,948m
$4,975m
Established RoW
$
4,975m
$4,975m
Growth and Therapy Area Leadership
Summary and
performance indicators
We grow our business and serve
more patients globally by working
ethically, maintaining excellence
in manufacturing and supply,
and through the use of AI and
new technologies.
Our performance in 2024
•
Total Revenue, comprising Product Sales,
Alliance Revenue and Collaboration
Revenue, increased by 18% (21% at CER)
to $54,073 million.
•
Total Revenue in the US increased by
22% to $23,235 million, Emerging
Markets increased by 14% (22% at CER)
to $13,675 million and Europe increased
by 27% (26% at CER) to $12,188 million.
•
Committed to high ethical standards:
401 employees and third parties were
removed from their role as a result
of a breach.
•
Delivered 202 successful market
launches.
•
Completed more than 20 major or
strategically important business
development transactions.
Performance indicators
Global Total Revenue by geography
Our regions
We strive to meet our growth and
profitability goals through commercial
excellence and by aligning product strategy
and commercial delivery in each of the
three regions into which we are organised:
the US, Europe-Canada and International
(which comprises Emerging Markets,
including China, Australia and New Zealand).
Japan reports separately. The reconciliation
of these organisational regions to our financial
reporting regions of the US, Europe,
Established RoW and Emerging Markets can
be found in Market definitions on page 240.
Within the International region, AstraZeneca
is aware of a number of investigations by
Chinese authorities which, to the best of
AstraZeneca’s knowledge, relate to
allegations of medical insurance fraud,
illegal drug importation, and personal
information breaches by current and former
AstraZeneca employees. In January 2025,
AstraZeneca received a Notice of Transfer
to the Prosecutor and an Appraisal Opinion
from the Shenzhen City Customs Office
regarding suspected unpaid importation
taxes as further described on page 211
in Note 30 to the Financial Statements.
AstraZeneca continues to fully cooperate
with the Chinese authorities.
In December 2024, AstraZeneca
announced the appointment of Iskra Reic
as Executive Vice-President, International.
Iskra succeeded Leon Wang who is on
extended leave from the Company while
under investigation in China.
39
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Business Review | Growth and Therapy Area Leadership
Sales and marketing
Our growth is delivered by our
Commercial teams, which employed
47,200 people at the end of 2024.
During the year, we had an active presence
in more than 80 countries and sold our
products in more than 125 countries. In most
markets, we sell our medicines through
wholly-owned local marketing companies.
We also sell through distributors and local
representative offices. We market our
products largely to primary and specialty
care physicians.
Growth and Therapy Area Leadership
US
As the twelfth largest prescription-based
pharmaceutical company in the US, we have
a 3.5% market share of US pharmaceuticals
by sales value.
1
Total Revenue increased by 22% in 2024
to $23,235 million, driven by the continued
growth of our Oncology and
BioPharmaceuticals medicines. Recent
launches of
Wainua
and
Airsupra
are
significant additions to our product portfolio,
expanding our offerings in key therapeutic
areas and strengthening our position in
the market.
The US healthcare system is complex.
Multiple payers and intermediaries influence
patient access to branded medicines
through regulatory rebates in government
programmes and voluntary rebates paid to
managed care organisations and pharmacy
benefit managers for commercially insured
patients. Significant pricing pressure is
driven by payer consolidation, restrictive
reimbursement policies and cost control
tools, such as exclusionary formularies and
price protection clauses. Many formularies
employ ‘generic first’ strategies and/or
require physicians to obtain prior approval
for the use of a branded medicine where
a generic alternative exists.
The Inflation Reduction Act (IRA) of
2022 was passed to address Medicare
spending concerns.
Farxiga
was selected
for the first round of Medicare price
negotiations under the IRA. As the
Maximum Fair Price for Medicare will take
effect in 2026, which is the same year we
expect to lose market exclusivity that will
also reduce
Farxiga’s
price, the impact is
expected to be manageable.
Calquence
has been selected for the
second round of price negotiations in 2025.
Its Maximum Fair Price for Medicare would
take effect in 2027 and the business impact
is also expected to be manageable. We are
well-positioned to communicate to the
Centers for Medicare & Medicaid Services
the value of
Calquence
for people covered
by Medicare. We have a diversified product
portfolio providing a broad spectrum of
treatments in different therapy areas,
allowing access for patients in need of
our innovative medicine.
Emerging Markets
AstraZeneca was the largest multinational
pharmaceutical company, as measured by
prescription sales, and the fastest-growing
top 10 multinational pharmaceutical
company in Emerging Markets in 2024.
Total Revenue was $13,675 million, up 14%
(22% at CER).
In China, AstraZeneca is the largest
pharmaceutical company in the hospital
sector, as measured by sales value.
In 2024, Total Revenue for China increased
by 9% (11% at CER) to $6,413 million (2023:
$5,876 million). In the fourth quarter, sales
of respiratory medicines such as
Pulmicort
and
Symbicort
were impacted by a reduction
in hospitalisations from seasonal respiratory
viruses. Roxadustat and
Lokelma
were
renewed in the National Reimbursement
Drug List (NRDL) and
Xigduo
,
Tagrisso
(ADAURA),
Lynparza
(PAOLA-1),
Calquence
,
Soliris
and
Koselugo
achieved listing for the
first time. Since the implementation of VBP,
several AstraZeneca brands have been
impacted. In the most recent cycles of VBP
implementation,
Faslodex
was included and
a number of previously included brands
such as
Crestor
and
Losec
faced
International Reference Pricing (IRP) driven
price cuts. Additional AstraZeneca brands
are expected to be included in future VBP
and IRP cycles.
We were shocked following the Russian
invasion of Ukraine in February 2022 and,
since then, have provided practical support
to ensure the safety, health and wellbeing
of our employees. As a healthcare business,
we are doing everything possible to ensure
medical supply chains continue to operate
and that patients in both countries are able
to access our medicines, while complying
with sanctions imposed on Russia.
Europe
The total European pharmaceutical market
was worth $280 billion in 2024. We are
the fourth largest prescription-based
pharmaceutical company in Europe (see
Market definitions on page 240) with a
3.8% market share of pharmaceutical
sales by value.
1
Total Revenue was $12,188 million,
up 27% (26% at CER).
Established RoW
In Japan, AstraZeneca was the second
largest prescription-based pharmaceutical
manufacturer with a 6.5% value market
share of Innovative Branded pharmaceutical
sales by value.
1
Established RoW comprises Japan, Canada,
Australia and New Zealand. In 2024, Total
Revenue decreased by 2% (increased by
3% at CER) to $4,975 million, with sales in
Japan down 4% (increase of 4% at CER) to
$3,564 million.
¹ In the US and Japan, IQVIA data does not include Alexion.
40
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
Business Review
continued
Operations
Our manufacturing and supply
function continued to support
business growth and pipeline
development, maintaining excellence
in product launch, quality and
resilient supply, with focus on
progressive, sustainable processes.
In 2024, we made strong progress against
our Operations strategic goals, expanding
capacity and new modality capability,
while leveraging new technology and
digital innovations to sustainably support
the demands of the business.
•
Delivered 202 launches across markets.
•
Progressed our investments in
manufacturing footprint, technology and
digital innovations.
•
As we continue to progress our Ambition
Zero Carbon strategy, Södertälje is our
latest site that has delivered a 98%
reduction in Scope 1 and Scope 2 GHG
emissions (from 2015 baseline) measured
against science-based targets.
Managing our supply chain
The global environment remains
challenging, volatile and uncertain. The
conflict in the Middle East has disrupted
shipping lanes, resulting in increased sea
lane transit times and the closure of several
seaports. Furthermore, the impact of climate
change has exacerbated the occurrence of
weather events, from floods in Brazil in the
second quarter to strong typhoons in Asia
and hurricanes in the Americas. Despite the
external environment, we have continued to
meet our responsibilities to patients by
maintaining high customer service levels.
We have demonstrated flexibility to adapt
the network to new challenges and capitalise
on growth opportunities. In 2024,
AstraZeneca maintained industry-leading
quality performance, with zero patient-level
recalls during this period.
Supply chain finance
AstraZeneca has a supply chain finance
programme to support the cash flow of
our external supply base. The programme
is managed by Taulia Inc. (with funding
provided by some of the Group’s relationship
banks) and provides suppliers with visibility
of invoices and payment dates via a
dedicated platform. Suppliers can access
this platform free of charge and have
flexibility to select individual invoices for
early payment.
On election of an early payment, a charge
is incurred by the supplier based on the
period of acceleration, central bank interest
rate and the rate agreed between Taulia Inc.
and each supplier. All early payments are
processed by the funders and AstraZeneca
settles the original invoice amount with the
funders at maturity of the original invoice
due date. The programme operates in the
US, UK, Sweden and Germany. As at
31 December 2024, the programme had
432 suppliers enrolled and a potential early
payment balance of $105 million. We have
a separate programme in China with 26
suppliers enrolled and a potential early
payment balance of $1 million.
Global manufacturing capability
Our principal tablet and capsule formulation
and packing sites are in the UK, Sweden,
China, Puerto Rico and the US, with local
supply sites in Egypt, India, Japan and
Russia, and regional supply sites in Brazil,
Indonesia and Mexico. We also have major
formulation sites for the global supply of
parenteral and/or inhalation products in the
US, Sweden, France, Australia and the UK.
Most of the manufacture of active
pharmaceutical ingredients (APIs) is
delivered through the efficient use of
external sourcing that is complemented
by internal capabilities. For biologics,
our principal commercial manufacturing
facilities are in the US, Ireland, Sweden,
the UK and the Netherlands. Our network
contains capabilities in process development,
drug substance and drug product
manufacturing, and distribution.
In May 2024, we announced our intention
to build a $1.5 billion manufacturing facility
in Singapore for antibody drug conjugates
(ADCs), enhancing global supply of our
ADC portfolio. The facility will be ready for
commercial production in 2029. As part
of AstraZeneca’s commitment to driving
sustainability in healthcare, the Company
will work with Singapore’s government
and others on green solutions for the ADC
facility. This facility will be designed to
contribute positively to Ambition Zero
Carbon from its first day of operations.
In November 2024, manufacturing ceased
at our tablet packing facility in Reims,
France. The intent to exit was announced
in September 2022.
At the end of 2024, we employed
16,300 people at 26 manufacturing sites
in 16 countries.
For more information on
progress we are making with
ADCs, see our Oncology
Therapy Area Review, from
page 16.
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Financial Statements
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Business Review | Growth and Therapy Area Leadership
Growth and Therapy Area Leadership
Building trust by demonstrating integrity,
transparency and fair treatment is central to
everything we do, and supports our ability to
operate, innovate and bring healthcare to
patients. Our shared Values underpin all our
activities and serve as a compass to guide us.
Standards and policies
Our Code of Ethics (the Code), and its
supporting Standards, embodies our
Values, including expected behaviours,
principles and policies, and is the
foundation of our global compliance
programme. The Code covers global
policies on: Science, Interactions,
Workplace and Sustainability. It applies to
all Executive and Non-Executive Directors,
officers, employees and contract staff of
our Group, empowering them to make the
right decisions in the best interests of the
Group, our communities and those we
serve. The Code is implemented through
our Chief Compliance Officer and Chief
Executive Officer and supported by all
members of the Senior Executive Team
(SET). In 2024, 100% of active employees,
including the SET, completed mandatory
annual training on the Code.
A Finance Code complements the Code
of Ethics and applies to the Chief Financial
Officer (CFO), the Group’s principal
accounting officers (including key finance
staff in all overseas subsidiaries) and all
managers in the Finance function. This
reinforces the importance of the integrity
of the Group’s Financial Statements, the
reliability of the accounting records on
which they are based, and the robustness
of the relevant controls and processes.
The Code of Ethics and Finance Code ask
employees to report possible violations
and provide information on how to do so,
including via the AZ Ethics helpline and
website which are also available to third
parties, including anonymously where
permitted by local law. Anyone who raises
a potential breach in good faith is fully
supported by management on a confidential
basis (subject to disclosure obligations in
local markets) and we do not tolerate
retaliation. Most cases are reported through
line managers, local Human Resources (HR),
Legal or Compliance functions. Cases are
investigated by HR, Compliance Assurance,
or the Global Compliance Investigations
(GCI) team, an above-market investigatory
unit within the Global Compliance function,
depending on the nature of the matter.
There were 3,853 instances (instances
can involve multiple people) of employee
and third-party non-compliance with our
policies (2023: 3,756). A total of 401
employees and third parties were removed
from their role as a result of a breach
(2023: 296) and 2,498 received warnings
(2023: 2,968). We brief the Audit Committee
quarterly on breach statistics, serious
incidents and corresponding remediation.
Breaches primarily consist of low-impact
incidents. We continue to foster a culture
where employees can speak their minds,
with strong first-line oversight (and related
reporting) as well as targeted second-line
monitoring to identify concerns early and
use learnings to improve our programme.
Our Pulse survey enables management
and Board Directors to understand the
views and sentiments of our employees,
including the proportion of employees
who feel comfortable speaking up at work.
The resulting report also demonstrates how
our Values and behaviours are embedded
across the workforce, including a summary
metric dashboard organised by category,
with remedial action taken on any concerns
identified and discussed as necessary.
Anti-bribery and anti-corruption
We do not tolerate bribery or any other
form of corruption. Potential bribery and
corruption risk factors vary, for example
by geography, the nature of the business,
and the role of third-party vendors, as
well as over time. Preventing bribery and
corruption is a focus of our third-party risk
management (3PRM) and due diligence
processes, as well as our monitoring and
audit programmes. Our Anti-Bribery and
Anti-Corruption Global Standard outlines
our key anti-bribery and anti-corruption
principles and is complemented by
additional Global Standards and local
requirements. Through our Global
Compliance programme and associated
policies and other controls, we strive to
comply with all applicable anti-bribery and
anti-corruption legislation, including the
UK Bribery Act 2010 which is aligned
with the United Nations Convention
against Corruption.
There are three lines of defence in our risk
management framework: line management,
Risk and Global Compliance functions and
Group Internal Audit (GIA). GIA is responsible
for reporting significant risk exposures and
control issues to the Board and senior
management, including matters that are
referred by the Audit Committee. In addition
to the GIA review of risk, Global Compliance
provides overviews of significant incidents
and their outcomes to the Audit Committee.
Business conduct
We seek to create positive societal
impact beyond the direct benefit of
our life-changing medicines. We
embed ethical behaviour in all our
business activities, markets and
across our value chain. We promote
ethical, transparent and inclusive
policies, both internally and with
our partners and suppliers.
BV
42
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Strategic Report
Business Review
continued
As outlined, we provide various methods by
which ethical concerns can be confidentially
reported to the Group and these are centrally
recorded within our incident reporting
systems. Any whistleblower will have the
opportunity to report violations inside and
outside of the organisation (to the
designated authority or to the media), and
we ensure that the level of protection is the
same, regardless of the means of reporting.
The most material incident reports from
whistleblowers – those implicating senior
leaders or involving other allegations of
serious misconduct (including alleged
bribery or corruption) – are promptly,
independently and objectively investigated
by our GCI team. We maintain confidentiality
and separation between reporters and
implicated parties during our compliance
investigations to ensure a safe environment
that encourages employees to feel
comfortable speaking up.
Learning pathways are available to Global
Ethics & Compliance and Employee Relations
employees focusing on the principles of
conducting an investigation. Modules include
connecting with the reporter, planning and
fact gathering, interview techniques,
credibility assessments, reporting and case
closure. In 2024, work was undertaken to
update and improve our global investigations
Standard Operating Procedure and develop
a global investigations playbook to enhance
the consistency and quality of the
investigations our employees conduct.
Material government investigations or
proceedings including material investigations
related to anti-bribery and anti-corruption
are detailed in Note 30 to the Financial
Statements on page 203.
Responsible sales and marketing
Our compliance professionals advise on,
and monitor adherence to, our Code and
policies, and work with local staff to ensure
we meet our commitment to high ethical
standards. Nominated signatories review
product promotional materials and activities
to ensure compliance with applicable
regulations and codes of practice, and that
information is accurate and balanced. GIA
conducts audits of selected marketing
companies. In 2024, we identified 12
confirmed external breaches across our
Commercial business (2023: four).
Confirmed external breaches comprise
cases where AstraZeneca has been found
to violate a law, industry code, or regulation
by an external authority.
Animals in research
The responsible use of animals is a vital
part of biomedical research and product
safety testing, where suitable alternatives
are not available. At the centre of our
commitment to quality science and animal
welfare are the Replacement, Reduction and
Refinement of animals in research (the 3Rs).
All animal studies are undertaken in
compliance with all relevant local and
national laws and regulations, and with the
principles of the ‘Guide for the Care and Use
of Laboratory Animals’ 8th Edition (Institute
for Laboratory Animal Research). Wherever
possible, we work with third parties
accredited by the Association for
the Assessment and Accreditation of
Laboratory Animal Care International.
Animals were needed for in-house studies
141,947 times in 2024 (2023: 122,768), and
on our behalf in contract research studies
63,810 times (2023: 59,690). In total, over
97% were rodents or fish, with the majority
being mice (86%). The remainder is made
up of rabbits, camelids, ferrets, dogs, pigs,
non-human primates, chickens and sheep.
Dogs and non-human primates make up
less than 1% of the total. AstraZeneca does
not conduct research using wild-caught
non-human primates or great ape species.
AstraZeneca is committed to transparency
and is signatory to the Concordat on
Openness on Animal Research (UK), the
Openness Agreement on Animal Research
and Teaching (Australia/New Zealand) and
has endorsed the statement of intent for a
U.S. Animal Research Openness Agreement.
AstraZeneca has an animal welfare
assurance programme that ensures
research conducted by third parties
meets our high standards.
Supplier management
All employees and contractors who
source goods and services on behalf of
AstraZeneca are expected to follow our
Global Standard for Procuring Goods and
Services. Through assessments and
improvement programmes, including our
3PRM system, we monitor supplier
compliance with our published Expectations
of Third Parties policy. Before and after
we contract with third parties, we assess
whether their reputation and actions align
with our expectations and any concerns
or changes are addressed.
As a member of the Pharmaceutical
Supply Chain Initiative (PSCI), AstraZeneca
supports the PSCI Principles for Responsible
Supply Chain Management, which outline
industry expectations of the supply chain in
ethics, human rights and labour, health and
safety, environment, and related
management systems.
We have a 3PRM process in place to
identify and assess potential risks with our
suppliers. This includes human and labour
rights as a standalone risk area and
assessing risks such as forced or bonded
labour, child labour, wages and benefits,
hours/rest periods and leave, collective
bargaining, grievance procedures,
discrimination and harassment. Relevant
commitments and policies are detailed in
our published Modern Slavery Statement.
The 3PRM process also identifies and
assesses supplier activities across multiple
other risk areas, including safety, health and
environment, anti-bribery and anti-corruption,
data privacy and IT security.
In 2024, we conducted 59 audits (2023: 47)
on high-risk commercial suppliers (external
manufacturing partners) to ensure
appropriate practices and controls. Of these,
48% fully met our expectations while 52%
had improvement plans for minor instances
of non-compliance. There were two audits
indicating a high risk to AstraZeneca and
action has been taken to mitigate these
supply and/or reputational risks.
Our Global Procurement function uses
the EcoVadis platform to assess the
sustainability performance of our suppliers,
rating their environmental, social and
governance (ESG) performance against
four themes: Environment, Labour & Human
Rights, Ethics, and Sustainable Procurement.
Our Sustainable Procurement programme
embeds responsible sourcing practices
through our procurement activity and
promotes ethical behaviour by our suppliers
in support of our own procurement policies,
targets and commitments. Our Supplier
Diversity Programme maximises opportunities
for small and diverse businesses to be part
of our value chain and supports their growth.
As part of our Ambition Zero Carbon
strategy, we aim to engage with the top
95% of our suppliers by spend covering
purchased goods and services and capital
goods, and 50% of our suppliers by spend
covering upstream transportation and
distribution and business travel, to support
them to set validated science-based GHG
emissions targets (SBTs) by end of 2025.
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Business Review | Growth and Therapy Area Leadership
Cell therapy and
T-cell engagers
IT and IS resources
AI is transforming how we work and
helping us push the boundaries of
science, enabling us to deliver new
medicines faster and improve the
patient experience.
We continue to expand our core
competencies in data science and AI
engineering and are investing in our people
to ensure our workforce can maximise the
potential of emerging technologies. We are
building communities of practice, delivering
world-class training and bringing together
people for collaboration and insight.
In R&D, we are now using AI and data
science across 85% of our small molecule
programmes – from target identification to
clinical trials. AI is also being used to design
and develop other therapeutic modalities
including peptide or protein therapeutics,
nucleotide-based therapeutics and
cell-based therapeutics. Our researchers
and scientists now have access to a range
of generative AI tools to guide complex
tasks such as hypothesis generation and
protocol authoring. Early measurement
shows that 92% of 1,200 employees
surveyed who use the Microsoft CoPilot tool
are experiencing time savings as a result.
In Commercial, we are partnering with
leading technology companies to apply
AI to global healthcare challenges. In one
example, our work with local healthcare
systems in 22 countries has led to 3.5 million
AI-powered, routine chest x-rays being
used as early screening to identify high-risk
lung nodules. We are also deploying
AI-powered, integrated, marketing technology
platforms to support our increasing number
of new brands and indications.
In Operations, technology is transforming
our supply chain into an intelligent,
autonomous system with an emphasis
on sustainability. By implementing over
30 digital tools and AI solutions, for selected
processes and products, our plant in Wuxi,
China, has achieved a 55% output increase,
44% lead time reduction and a 54% boost
in productivity. In Sweden, which is
responsible for a significant part of our
global production, digital and AI solutions
have elevated productivity by 56% and cut
product launch lead times by 67%. Both
have earned recognition in 2024 from the
World Economic Forum as lighthouse
manufacturing sites.
Our Enterprise AI Governance Framework
aligns with international regulations and
standards, including the EU AI Act and the
NIST AI Risk Management Framework. The
framework contains policies, processes and
guardrails for building, buying, deploying
and using AI, including for procurement,
third-party due diligence and guidelines
on employee usage.
Growth and Therapy Area Leadership
Investing in transformative R&D technologies
We are investing in these therapies to
bring them to more patients, across
oncology, immune-mediated diseases
and rare disease.
In Oncology, we are exploring new ways
to harness the immune system to fight
cancer, including T-cell engagers that
can engage and activate a patient’s
T-cells against cancer. We are advancing
next-generation CAR
-T and TCR-T
-cell
therapies that are genetically engineered
to target a patient’s specific tumour, and
developing new ways to enhance the cells’
potential effectiveness, for example by
resisting the immunosuppressive
microenvironment.
In Immunology, we aim to use similar
approaches, including CAR-T
-cells and
CAR-Tregs, to target the root cause of
immune-mediated diseases, to ‘reset’ the
immune system and correct the immune
dysfunction to return people to health.
We are also working to overcome the
barriers to widespread adoption of cell
therapy in terms of access, manufacturing
and scale.
Strategic Report
44
Business Review
continued
Zero
material
cybersecurity
incidents
Zero
material security
breaches involving
personal data
Cybersecurity and data privacy
Innovative technology platforms are
transforming the way we work, and
we have measures in place to address
the related cybersecurity and data
privacy risks.
BV
Cybersecurity
We operate an evergreen cybersecurity
training and awareness programme that is
mandatory for all employees and is designed
to reduce risk and improve resilience.
Cybersecurity performance is reviewed
monthly and based on standardised service
delivery, programme management, and
operational performance metrics, with
recurring oversight presentations to the SET,
the Audit Committee and Board of Directors.
There were no material business disruptions
due to a cybersecurity incident in 2024, and
we have recruited a third-party alert triage
partner to free up capacity in our cyber
team for forensic investigations and
proactive threat detection.
This year we also launched a process to
re-baseline and prioritise critical business
applications for our disaster recovery
plans over a three-year period to 2026.
This will improve resilience and
preparedness for unexpected or
uncontrolled events. Effectiveness is
measured through standardised service
delivery, programme management and
operational performance metrics.
We emphasise cybersecurity culture and
workforce awareness via mandatory annual
training, phishing tests and communication
on internal social media. Recognising the
elevated threat and risk environment, we
have delivered workforce-wide messaging
regarding each person’s responsibility to
protect AstraZeneca.
Data privacy
Our three principles of data privacy are:
1. We respect and protect privacy by
collecting, using, retaining, sharing
and/or disclosing personal data lawfully,
fairly, transparently and securely.
2. We respect data subject rights and
respond to queries and requests made
by individuals about their personal data
in a timely manner.
3. We hold third parties with whom we work
to the same expectations set out in the
Global Privacy Standard.
Enhanced data governance practices are
in place through our Enterprise Data Office
(EDO), established in 2023, and sponsored
by our Enterprise Data Council (EDC). The
EDO strengthens and standardises data
governance, including by partnering with
other data functions across the Company
and acting as a central hub for data
management and related regulatory
compliance. This approach also ensures
that our data policies and standards are
streamlined, clear and effective.
Key privacy compliance concerns are
reported via the SET data governance
boards, EDO, EDC and appointed senior
leaders. Breaches and policy deviations
can also be reported to AZ Ethics via the
helpline or website. In 2024, our data
privacy focus has been to develop a set of
new standards, aligned to evolving global
privacy legislation and those of the EDO;
the format standardisation and updating
of content for global privacy notices; and
enhancement and refinement of privacy risk
assessments and management process.
In 2025, we will focus on continued
alignment and refinement of processes
with the EDO and Global Business Services,
in particular regulatory intelligence and
readiness, privacy risk management and
reporting, and the automation and
refinement of privacy operational activities.
For more information, see:
Cybersecurity in the Risk
overview, page 64.
AZ Ethics, page 42.
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Growth and Therapy Area Leadership
In business development, we assess
cutting-edge technologies and products
that can help enhance the quality,
effectiveness and productivity of our
research and translational capabilities
across our therapy areas. Partnerships
include accessing key innovations across
AI, precision medicine and genomics as well
as data and digital technologies, to help
inform the optimal treatments for patients.
Our Business Development teams pursue
opportunities to access the best science
and innovation, and partners range from
academia and governments to peer
companies and biotechnology companies.
Our global strength, with balanced
presence across regions and disease
areas is supported by more than 1,000
collaborations worldwide. In 2024,
we completed more than 20 major,
or strategically important, business
development transactions, some of
which are summarised below.
In 2024, new deals included:
Fusion
The acquisition of all outstanding shares in
Fusion Pharmaceuticals Inc., a clinical stage
biopharmaceutical company developing
next-generation radioconjugates. The
acquisition complements AstraZeneca’s
leading Oncology portfolio with the addition
of the Fusion pipeline of radioconjugates,
including FPI-2265, a potential new
treatment for patients with metastatic
castration-resistant prostate cancer, and
brings new expertise and pioneering R&D,
manufacturing and supply chain capabilities
in actinium-based radioconjugates to
AstraZeneca. Combined, the upfront
payment and maximum potential contingent
value payment, if achieved, represent a
transaction value of approximately
$2.4 billion.
Amolyt Pharma
The acquisition of Amolyt Pharma SAS,
a clinical-stage biotechnology company
focused on developing novel treatments for
rare endocrine diseases. The acquisition
Business development
Business development is an essential
part of our strategy and portfolio
prioritisation process, contributing to
accelerating delivery of new medicines
targeting unmet medical need.
bolsters the Alexion, AstraZeneca Rare
Disease late-stage pipeline and expands
on its bone metabolism franchise with the
notable addition of eneboparatide (AZP-
3601), a Phase III investigational therapeutic
peptide with a novel mechanism of action
designed to meet key therapeutic goals for
hypoparathyroidism. AstraZeneca has
acquired all of Amolyt Pharma’s outstanding
shares for a total consideration of up to
$1.05 billion, on a cash and debt-free basis.
CSPC
The licence agreement with CSPC
Pharmaceutical Group Ltd to advance the
development of an early stage, novel small
molecule Lipoprotein (a) (Lp(a)) disruptor
(YS2302018), which will be developed as a
novel lipid-lowering therapy with potential
in a range of cardiovascular disease
indications alone or in combination,
including with an oral small molecule
PCSK9 inhibitor. CSPC will receive an
upfront payment of $100 million from
AstraZeneca. CSPC is also eligible to
receive up to $1.92 billion in further
development and commercialisation
milestone payments plus tiered royalties.
Weight
management
and risk factors
Investing in transformative R&D technologies
The World Health Organization recognises
obesity as one of the most important public
health challenges facing the world today.
Approximately 60% of people diagnosed
with obesity or as overweight have at least
one comorbidity, such as type 2 diabetes,
cardiovascular disease, heart failure and
chronic kidney disease.
We are targeting the underlying causes
of obesity with our growing pipeline of
novel treatments and combinations with
complementary (or synergistic)
mechanisms. Our portfolio of molecules is
designed to go beyond short-term weight
loss targets and focus on healthy weight
management, quality of weight loss, and
cardiometabolic benefit.
Strategic Report
46
Business Review
continued
People and Sustainability
Summary and
performance indicators
Our team values diversity and high
performance, using technology and
AI to make our work easier and more
efficient. We focus on climate, nature
and healthcare challenges in an
ethical and transparent way.
Our performance in 2024
BV
People
•
Received 1.3 million applications and
hired 23,000 employees (7,700 internal
and 15,300 external).
•
4,300 of these hires were a direct result
of our employee referral scheme.
•
Over 5,900 employees participated in
a development programme.
•
50.6% of our senior middle management
roles and above are filled by women.
Sustainability
•
Reached 90.5 million people through
our flagship access to healthcare
programmes.
•
Conducted climate and water risk
assessments at 40 sites to improve
resilience.
•
Reduced Scope 1 and 2 GHG emissions
by 77.5% from 2015 baseline year.
-77.5%
-67.6%
-58.7%
2024
2023
2022
-77.5%
-77.5%
Ambition Zero Carbon
(Scope 1 and 2)
1
2024
2023
2022
82%
83%
83%
82%
82%
Speak up culture
2
2024
2023
2022
90.5m
66.4m
44.6m
90.5m
90.5m
People reached by our access
to healthcare programmes
3
Performance indicators
BV
People
This priority is built on being a great place to
work, patient-oriented, advancing a culture
of lifelong learning, and achieving inclusion
and diversity goals.
Performance indicators
BV
Sustainability
Achieving a healthier, more sustainable
future requires tackling the biggest
challenges of our time – from climate
change and nature loss to health equity
and health system resilience – and doing
so in a way that is ethical, transparent
and inclusive.
1
Reduction of Scope 1 and 2 GHG
emissions from 2015 baseline year.
2
Based on an internal survey which
asked all AstraZeneca employees if
they felt comfortable to speak up/speak
my mind and express my opinion at work.
3
Cumulative data including current and
historical programmes: Healthy Heart
Africa, Young Health Programme,
Healthy Lung and Phakamisa.
For more information, see
People from page 48 and
Sustainability from page 51.
Great place to work
84%
believe that AstraZeneca
is a great place to work
Patient-oriented
87%
believe that AstraZeneca
is patient-oriented
Advance culture of
lifelong learning
84%
receive coaching to
improve contribution
Achieve inclusion and
diversity goals
80%
feel valued for diverse
opinions and thinking
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People and Sustainability
Achieving our inclusion
and diversity goals
At AstraZeneca, we place Inclusion before
Diversity. That is because we first focus
on creating a culture of inclusion and
belonging, which enables us to attract
and retain a rich and diverse workforce.
Our global commitment to inclusion and
diversity is woven into what we do, and is
reflected in our Values and the behaviours
that underpin them.
Women comprise 54% (approximately
51,000) of our global workforce and men
46% (approximately 43,000). At the end of
2024, there were six women on our Board
(46% of the total). Five out of 10 SET
members (50%) were women and five were
men (50%). Directors of the Company’s
subsidiaries comprised of 136 women (30%)
and 310 men (70%).
1
Our employees represent a diverse range
of backgrounds and we recognise that
everyone plays a role in inclusion and
diversity. Our Global Inclusion and Diversity
Ambassador Group, sponsored by our CEO,
reflects the diversity of our global workforce
and organisational structure. They are
responsible for collaborating with local
leaders to customise approaches that
address local needs and drive progress
towards our global inclusion and
diversity commitments.
Our Board of Directors and the SET conduct
biannual and quarterly reviews, respectively,
of our workforce composition, covering
gender, ethnicity and age representation. In
the US, where we have more comprehensive
data available, 37.9% of our workforce
identify as an ethnic minority (2023: 36.8%).
We are committed to hiring and promoting
talent ethically and in compliance with
applicable laws. Our Code of Ethics and its
supporting Standards are designed to help
protect against unlawful discrimination on
any grounds, including disability. The Code
covers recruitment and selection,
performance management, career
development and promotion, transfer,
training (including, if needed, for people
who have become disabled), and reward.
AstraZeneca embraces the cognitive
differences of neurodivergent employees
and supports employees with both seen
and unseen disabilities in line with their
country-specific laws and regulations.
Where risk assessments can be performed,
we will consider accommodating
adjustments to the working environment
that support an inclusive and safe workplace.
Our Global Standard for Inclusion and
Diversity sets out how we foster an inclusive
and diverse workforce where everyone
feels valued and respected because of their
individual abilities and perspectives. In 2024,
our inclusion and diversity efforts earned
recognition externally. We were featured in:
•
Forbes World’s Top Companies for Women
•
Forbes World’s Best Employers
•
Financial Times, Diversity Leaders 2025
•
TIME World’s Best Companies.
Human rights
BV
Our human rights principles support the
basic rights of all people, such as the right
to health, freedom from slavery, and
privacy. Our Code of Ethics, Human Rights
Statement and Expectations of Third Parties
commit us to respecting and promoting
international human rights, both within our
own operations and our wider spheres of
influence. To that end, we integrate human
rights considerations into our processes
and practices. We are also committed to
ensuring that there is no modern slavery
or human trafficking in any part of our
business, including our value chain.
Our human rights policies are designed
to ensure we consider the impact of our
operations on all human rights including
those of the communities around our
operations. The output of our work to
mitigate human rights risks is detailed in
our Modern Slavery Statement, which is
published annually. We also provide
assurance annually to the Audit Committee.
Workforce safety and health
BV
We are committed to providing a safe
and healthy working environment for our
employees and partners. Our Global Safety,
Health and Environment (SHE) Standard
describes our commitment to, management
of, and accountability for SHE.
We set and monitor our safety and health
targets to support our workforce and aim to
achieve the highest performance standards.
In 2024, our work-related injury rate
reduced by 58% and our collision rate
reduced 51% from the 2015 baselines.
We are also committed to supporting
employee mental health and wellness
and there are several resources available.
This includes our Safe Space Employee
Resource Group and our Healthy Minds app,
which provides access to mental health and
wellbeing support anytime in 24 languages.
People
We rely on our global workforce
to uphold our Code of Ethics and
behaviours in line with our Values,
to deliver our strategic priorities and
work to sustain and improve short-
and long-term performance.
For more information on our
standards and Code of Ethics
and for our full statement
detailing how we work to
mitigate the risks of modern
slavery, see our website,
www.astrazeneca.com/
sustainability/resources.html.
1
For the purposes of section 414C(8)
(c)(ii) of the Companies Act 2006, ‘Senior Managers’ are the SET, the Directors
of all of the subsidiaries of the Company and other individuals holding named positions within those subsidiaries.
Individuals on multiple boards are counted once.
Enabling an agile organisation
In 2024, we continued to build talent
internally by developing critical skills across
our workforce, ensuring we have the
capabilities to achieve our Ambition 2030.
Key highlights:
•
Increased focus on building capability
at our Global hubs: Mississauga, Lisbon,
Barcelona and Warsaw. In 2024,
1,700 external hires were made in
these locations.
•
Continued to develop internal talent and
made 5,800 promotions during 2024.
•
Received external recognition for our
female leaders: Sharon Barr and Susan
Galbraith were awarded in the Women in
Biopharma 2024 report, Pam Cheng was
recognised in the TIME100 Health leaders
and Iskra Reic was acknowledged by
Fierce Pharma.
Listening to our workforce
Encouraging employees to provide
continuous feedback through various
mechanisms helps us to foster an inclusive
culture and be a great place to work. We
collect feedback through onboarding
surveys, exit interviews and our global
employee engagement survey. We
encourage managers to listen to the
workforce by providing them with access
to the aggregated results for their teams
and, in 2024, we launched a new reporting
tool to further support managers with
understanding engagement across their
teams. To ensure we are fully transparent
we share our global results with the
Board of Directors, the SET, line
managers and employees.
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continued
84%
employee belief
that AstraZeneca
is a great place
to work
10.9%
employee turnover
6.5%
employee overall
promotion rate
88%
employee belief
that in the last
12 months, I have
improved my
existing skills,
or learned new
skills, or had a
development
opportunity
Central to our success is ensuring all our
employees have the potential to develop
and grow and we are committed to being
a great place to work. We face increasing
external competition for market-leading
talent. We must attract and retain highly
skilled personnel to support critical
position succession planning and the
implementation of our strategic objectives
and business operations. Our recruitment,
deployment, reward and development
practices, and our approach to working
arrangements, are designed to attract and
retain diverse individual talent at different
career and life stages. As a Group, our
global footprint, bolstered by the locations
of our strategic sites and Global hubs,
provides AstraZeneca with access to a
greater diversity of talent to strengthen
market and global teams.
Talent acquisition
We target our recruitment and retention
activities to secure critical skills and
capabilities and invest in innovative
technology (such as AI-automated interview
scheduling and job advert writing tools) to
reduce administrative tasks and enable
Talent attraction and retention
Attracting, retaining and developing
talented individuals is key to our
growth and success. We achieve this
by cultivating a great place to work
that values and rewards innovation,
entrepreneurship and outstanding
performance.
BV
positive candidate and employee
experiences. Our deployment team is
focused on providing an exceptional talent
acquisition partnering service to secure
the best talent for our business from the
1.3 million applications we receive for
24,800 roles each year.
Talent scouts are an integral part of our
approach. Working globally, their deep
understanding of business needs develops
robust capability pipelines, ensuring that
engaged, validated candidates are available
when needed. They also build external
succession plans for critical senior executive
roles, sourcing market-leading talent,
particularly where internal succession plans
do not fully meet business requirements,
thus mitigating risk to business continuity.
In 2024, we expanded the remit of our
talent scout organisation to include niche
and critical skill hiring and pipeline-building,
and proactive engagement with top talent
to share opportunities and provide expert
coaching and guidance throughout the
hiring experience.
Gene therapy
and gene editing
Investing in transformative R&D technologies
Gene therapy and gene editing have
the potential to transform patient
outcomes by directly addressing the
underlying cause of genetic diseases,
which represent an estimated 80% of
rare diseases. We are focusing on
diseases with a well-established genetic
basis and indications where we can
apply our expertise, including diseases
affecting the liver, heart, muscle and
brain. We are developing and advancing
new technologies to improve the precision
and delivery of gene therapies and gene
editing, opening new possibilities to meet
the needs of patients with few, if any,
treatment options.
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This extended model has created
capacity for business partnerships beyond
executive search and succession planning,
strengthening the business’s overall talent
agenda and allowing us to move at pace to
fill niche roles where competition for talent
is high. We are also building talent attraction
and sourcing centres in Guadalajara, Lisbon
and Chennai, and expanding our scouting
model across the new global hub locations,
enabling pipeline-building and sourcing of
top talent and reducing the time taken to
fill key roles, working enterprise-wide to
enhance the service offered.
Future initiatives as part of our employee
experience workstream include deploying
a talent intelligence platform, which will
connect people to opportunities by
leveraging data-led insights, breaking
barriers to internal mobility and democratising
how our employees discover and prepare
for their next career move. Another future
initiative is Onboarding 2030, which aims to
deliver inspiring onboarding experiences
that accelerate performance, foster
connection and unlock potential.
Development programmes
We develop capabilities for the future
through targeted and inclusive development
programmes, from early talent to enterprise
leaders. Our digital learning portal supports
a continuous learning mindset underpinning
a high-performing and innovative
organisation. Our development programmes
help us to unlock potential, drive innovation
and foster an inclusive culture, building the
capabilities of diverse future leaders in
support of our People strategy.
All employees (and contingent workers)
have access to our global learning platform.
Global learning and development
opportunities are provided alongside high
potential talent initiatives, such as our talent
development centres. We evaluate the
impact of our development programmes
two years after attendance, looking at
promotions, talent moves and retention.
During 2024, we launched foreign
language skills development in 70
languages to support talent mobility and
employee progression. We also offered all
employees the opportunity to join a
generative AI programme and have seen
over 10,000 enrolments. We have a global
operating model and governance in place
which includes all our SET areas. We can
therefore measure the impact of our global
development programmes, experiences and
platforms across all our geographies and
stakeholders. In 2024, 88% of employees
believe they have improved their existing
skills, learned new skills or had a
development opportunity.
Coaching and recognition
We focus on performance coaching,
development and continuous recognition
of the contributions of our employees. Our
approach’s effectiveness can be seen in the
completion rate of end-of-year insights by
managers and employees, which consider
deliverables, impacts and key learnings to
carry forward which were completed by
over 90% of employees. This is reinforced
through quarterly coaching check-ins
between employees and their manager
and regular coaching conversations,
the frequency of which is measured in our
Pulse survey, where 84% of employees
said that they have regular coaching from
their line manager.
Our Values are central to employee reward
and performance, and are the basis of our
CatAlyZe global recognition platform.
Employee relations
We have a Global Employee Relations team
that supports the application of our global
employment standards and policies,
ensuring consistency in managing issues
such as sexual harassment, and bullying
and harassment. In addition, our local
Employee Relations resource applies
these Standards in the context of local
law and practices, and provides advice on
country-specific policies. Many markets
within AstraZeneca have a dedicated
Employee Relations function engaging
with employee representative groups
and trade unions. Our ambition is to build
a positive and safe working environment
for employees. To achieve this, Employee
Relations works in partnership with Legal,
Compliance and HR functions and
employee representative groups, such as
the European Consultation Committee,
Works Councils and, where applicable,
our nationally recognised trade unions.
According to our internal Human Rights
survey carried out in 2024, we have a
relationship with trade unions in 29% of
the countries in which AstraZeneca
operates. Where trade unions do not exist,
all countries have established arrangements
for similar workforce engagement.
Accountability for these processes is with
the Chief Human Resources Officer and
delegated to members of the leadership
team. On a day-to-day basis, this is
managed by senior leaders.
We regularly receive feedback on
engagement with our workforce through a
range of sources including team meetings,
townhall meetings, and our internal social
media platform. Our annual Pulse survey
also provides structured employee
feedback and we use a Pulse GPT tool to
analyse comments and provide additional
insights into themes raised. We also hear
the views of employee representatives and
trade unions in relevant countries, and from
our Employee Resource Groups (ERGs),
which are voluntary, employee-led groups
based on shared identities and other
diversity cohorts. We have seven Global
ERGs with chapters in more than 15
countries as well as 12 country-specific
ERGs. Examples of ERGs include Network
of Women and Allies, TH!NK Neurodiversity
and AZ Pride. Leadership teams work with
their HR functions to drive employee
engagement activity in their areas.
Engagement feedback gives us a good
understanding of employees’ views and
priorities and is an important input as we
develop and review our employment
policies and practices.
We have pledged our commitment to the
United Nations Global LGBTI Standards
of Conduct and United Nations Women’s
Empowerment Principles. We are committed
to equal pay and regularly monitor the
reward of employees at all levels in the
organisation to ensure that it is equitable.
People and Sustainability
For more information, see:
Standards and Policies,
including Code of Ethics, on
page 42.
Engaging with our workforce,
on page 98.
Talent attraction and retention
continued
BV
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continued
Overview
We seek to create value beyond the
impact of our medicines by embedding
sustainability into everything we do – from
the lab to the patient – supporting health
system resilience and increasing access
to sustainable healthcare.
During 2024, we were recognised for
our efforts across all our sustainability
priorities, including:
•
Received a rating of AA (on a scale of
AAA-CCC) in the MSCI ESG Ratings
assessment.
•
Included in the Dow Jones Sustainability
World Enlarged and Europe Index.
•
Included in the 2024 Access to Medicine
Index top five.
•
Listed in the Financial Times European
Climate Leaders for the third
consecutive year.
Our approach to sustainability
Our Purpose, to push the boundaries of
science to deliver life-changing medicines,
is underpinned by our commitment to
contribute to the health of people, society
and the planet. As a global business, we are
playing our part by operating ethically and
responsibly, and helping tackle the biggest
challenges of our time, including climate
change, nature loss and health equity.
These challenges are interdependent and
require collaboration to be successfully
addressed, implementing a variety of
approaches across a network of
relationships. By working together to find
science-based solutions, we believe we can
drive real change and build a better future.
Governance
Our sustainability strategy is developed by
the SET, which reviews our Group scorecard
quarterly, and is approved by the Board,
whose Sustainability Committee monitors
the execution of the strategy, overseeing
our approach to communicating
sustainability activities with stakeholders,
and providing input to the Board and other
Board Committees on sustainability matters
as required. The Audit Committee is
responsible for overseeing sustainability
reporting in the Company’s Annual Reports,
Form 20-F filings and quarterly results
announcements. For further details on
Corporate Governance, see from page 85.
Our executive Sustainability Reporting
Steering Committee is comprised of
leaders representing functions relevant to
the sustainability strategy and reporting.
The Committee is co-chaired by the SVP,
Finance, Group Controller and Head of
Global Finance Services and the VP, Global
Sustainability and SHE, and reports on
progress to the Audit and Sustainability
Committees and keeps the SET updated
on current developments.
Sustainability
Sustainability at AstraZeneca means
harnessing the power of science and
innovation and our global reach, to
build a healthier future for people,
society and the planet.
BV
Benchmarking and assurance
We contribute to key global ESG
performance evaluations, recognising
the value of independent third-party
assessment and insights. Our performance
is also assessed independently based on
the information and data we make publicly
available. Bureau Veritas has provided
limited independent assurance for the
sustainability information contained within
this Annual Report and Form 20-F.
Assurance is in accordance with the
International Standard on Assurance
Engagements (ISAE) 3000 (Revised
) and
ISAE 3410 Assurance Engagements on
Greenhouse Gas (GHG) Statements.
Community investment
Community investment at AstraZeneca
is built upon the principles of equity,
transparency and partnership, and we
work together to build healthy and resilient
communities. In 2024, we contributed
$126.8 million in financial and non-financial
donations, including product donations,
to 928 non-profit organisations across
65 countries. We also donated $4.6 billion
(2023: $4.7 billion) of medicines through
patient assistance programmes around the
world, the largest of which is our AZ&Me
Prescription Savings Program in the US.
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People and Sustainability
In support of our commitments and
approach, AstraZeneca engages in ongoing
access initiatives enterprise-wide. We
continue to implement innovative solutions
to optimise affordability and accessibility,
where necessary, addressing barriers
beyond a medicine’s price. Each market
makes decisions based on their local
context to implement initiatives or access
strategies that ensure broader access to
our medicines, tracking and evaluating
outcomes to assess their effectiveness
and impact.
Affordability and pricing
The price of a medicine should reflect its
value, maximise patient access and provide
flexibility to accommodate variation in global
health systems and economic realities for
patients. Working closely with payers and
policymakers, we tailor approaches and
programmes to address local health system
resilience and patient needs to deliver
locally affordable medicines. We work
with payers to conclude value-based
reimbursement models that improve patient
outcomes and enable access to medicines
across key therapeutic areas and
geographic regions, adapting our prices
across the countries in which we operate.
For patients, this includes offering local
solutions to help bridge out-of-pocket
payment gaps, enabling patients to begin
and continue their prescribed treatments.
We also have various initiatives which
provide discounts and assistance. At a
market level, we offer training to healthcare
providers, promote health education and
awareness-raising activities and facilitate
access to treatment where appropriate.
Since 2017, we have implemented and
evolved a tiered pricing model to support
broader and accelerated patient access
to medicines in low- and middle-income
countries (LMICs). This establishes four
tiers of countries based on standardised
Gross National Income per capita aligned
to the World Bank classifications and allows
us to recognise income and ability to pay
differences across countries, providing
price flexibility in a commercially
sustainable way.
Patent protection and access
We are committed to not filing patent
applications in any low-income or least-
developed countries and many LMICs. We
will consider approaches from third parties
seeking non-exclusive voluntary IP licences
in developing countries. We are committed
to providing transparency about where our
patents are filed and enforced. Where we
maintain patent protection for assets which
may have relevance to Access to Medicine
Index diseases, we provide patent identity
and expiry information. We also provide
patent expiry information for the US, China,
the EU and Japan. The best way to address
the healthcare challenges faced by LMICs
is through the engagement of our industry
with other stakeholders to find constructive
ways to improve access to medicines and
delivery of healthcare. However, we
recognise the right of countries to use the
provisions of the World Trade Organization
Agreement on Trade-Related Aspects of
Intellectual Property Rights, and we
support the principles outlined in the
Doha Declaration, including compulsory
licensing in a ‘national emergency or other
circumstances of extreme urgency’ where
no appropriate alternative is available.
Early and post-trial access to medicines
We will provide access in certain
circumstances to a medicine before
approval within a country where other
treatments are not available. As such, prior
to commercial availability of our medicines,
we prioritise access to our medicinal
products through participation in a clinical
trial. We have ongoing clinical trials across
our therapy areas, details of which are given
in the Development Pipeline Supplement
on our website, www.astrazeneca.com/
annualreport2024.
Promoting access to healthcare
products for priority diseases and
in priority countries
For our access initiatives we had a 2025
target of 50 million people reached, which
was met in 2023, two years ahead of
schedule. In 2024, we continue to track
progress in reaching people through our
patient access programmes and new
targets relating to health equity will be
communicated in 2025.
We work across our main disease areas
to address non-communicable diseases
(NCDs) for patients with unmet medical needs
and collaborate with experts within health
systems to improve outcomes for patients.
Our ongoing access programmes include:
•
Oncology:
Cancer Care Africa, the Lung
Ambition Alliance
•
BioPharmaceuticals (CVRM):
Accelerate
Change Together on Chronic Kidney
Disease, Healthy Heart Africa
•
BioPharmaceuticals (R&I):
PUMUA
(Africa), Breeze of Air (Egypt), Healthy
Lungs
•
Rare Disease:
BeginNGS Consortium,
deciphEHR, Genomenon.
Disease prevention
Our Young Health Programme, which is
active in 41 countries and has directly
reached more than 19 million young people,
advances disease prevention and
awareness with the aim to prevent the most
common NCDs such as cancer, diabetes,
heart disease and respiratory disease
among young people.
Health system strengthening
We participate in the Partnership for
Health System Sustainability and Resilience
(PHSSR), which is a non-profit, multisector,
global collaboration with a unified goal of
building more sustainable and resilient
health systems, active in more than 30
countries. PHSSR has commissioned over
20 research reports to date, providing
independent, evidence-based
recommendations to strengthen health
systems and facilitate cross-border best
practice sharing, working with national
experts with first-hand experience.
Accessible and
affordable healthcare
We are committed to addressing
barriers to access to healthcare
and innovating to deliver our
life-changing medicines in a
sustainable and equitable way. Our
approach includes integrating health
equity within our core business and
therapy areas, understanding the
factors that drive poor outcomes in
certain populations, and addressing
health equity issues along the entire
patient pathway.
BV
For more information, see
Patent Expiries of Key
Marketed Products Supplement
on our website:
www.astrazeneca.com/
annualreport2024.
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continued
139,594
gross Scope 1 and 2 GHG emissions
(market-based) (tonnes CO
2
e)
2.58
Scope 1 and 2 GHG emissions intensity
(tCO
2
per million of Total Revenue)
5,897,822
gross Scope 3 GHG emissions
(tonnes CO
2
e)
59%
primary activity data in Scope 3 reporting
In 2020, we launched our Ambition Zero
Carbon strategy, through which we are
pursuing ambitious science-based
decarbonisation targets and making
progress towards achieving net zero by
2045. We also aim to become carbon
negative from 2030 for all residual
GHG emissions.
Transition plan for climate change
Achieving our verified Science Based
Targets initiative (SBTi) Net-Zero Corporate
standard targets will require decarbonisation
across the whole value chain. We are using
decarbonisation levers to address every
aspect of our GHG footprint, following a
hierarchy (eliminate-reduce-substitute) to
address each emission source across
Scopes 1, 2 and 3. Specific decarbonisation
levers are described below. Over 95% of
our total GHG emissions are in the upstream
and downstream value chain, reported
under Scope 3. Target achievement will
therefore require extensive decarbonisation
across our supply chain, including our
product portfolios.
We are progressing towards our SBTi
near-term target of 98% absolute reduction
in Scope 1 and 2 GHG emissions by 2026
from a 2015 baseline, having already
doubled our energy productivity since 2015
(unit revenue per unit of energy consumed
at our sites), continuing the transition to
electric vehicles in our road fleet (EV100) by
the end of 2025 and using 100% renewable
energy (RE100) for electricity and heat by
2026. To support delivery of our longer-
term target of 50% reduction in total
Scope 3 GHG emissions by 2030 and 90%
reduction by 2045, from a 2019 baseline,
we are engaging with suppliers for them to
set validated SBTs to cover most of our
supplier spend by the end of 2025.
Pharmaceutical products have a long
development cycle, which makes it critical
to design and embed climate considerations
at an early stage. To achieve our goals, we
must tackle emissions from our existing
commercial portfolio, which creates
challenges with heavily regulated
production processes and materials.
Climate governance
The guide for our Environmental
Management System is embedded in
our Code of Ethics and supported by our
already defined SHE Standard, together
with our OneSHE Framework of internal
standards, procedures and guidelines.
Our SHE management system ensures the
environmental risks of our activities are
assessed, operational controls are in place,
checks are completed through a risk-based
audit programme guided by an independent
organisation and there is an annual
Climate change
As part of our Ambition 2030,
we are focused on leading on climate,
equity and resilience, including
strategic initiatives to address the
interconnection between climate
and health.
BV
management review process. Climate
change adaptation is managed under our
Standards on Business Continuity Process,
Enterprise Risk, Management of Change,
Minimum Environmental Requirements for
the Built Environment and SHE Assurance.
The Sustainability Committee monitors
progress on Ambition Zero Carbon.
Sustainability reporting is overseen by the
Audit Committee. The CEO’s responsibilities
to the Board include the development and
performance of the Ambition Zero Carbon
strategy and related risks and opportunities.
The EVP, Global Operations, IT & Chief
Sustainability Officer is responsible for the
Ambition Zero Carbon strategy and its
execution, and all SET members have
responsibility for working with their teams
to ensure alignment of the Ambition Zero
Carbon strategy with business priorities
and climate risks and opportunities.
Our executive-led Ambition Zero Carbon
Governance Group is accountable for the
delivery of Ambition Zero Carbon. Regular
governance updates and proposals are
provided to the Governance Group, which
in 2024 included our CEO, CFO, and the
EVP, Global Operations, IT & Chief
Sustainability Officer. The Climate and
Nature Steering Group co-ordinates the
management of physical and transitional
climate risks and opportunities and supports
the Group’s adaptation and resilience
actions. Our Ambition Zero Carbon
investment is now being embedded into
business financial planning, which is being
adapted to incorporate the choices that will
be made across our global portfolio and the
impacts on the cost of goods. As our sites
and markets develop their zero carbon
roadmaps, they are identifying potential
investments and embedding them into the
annual long-range budgeting process.
Scope 1 and 2 Decarbonisation levers
Electrification (road fleet)
At the end of 2024 we had successfully
transitioned 63% of our total owned and
leased road vehicle fleet (over 20,000
vehicles) to battery electric vehicles (BEVs).
Our fleet accounts for 23% of our Scope 1
and 2 GHG footprint in 2024 and switching
to BEVs contributes to our Ambition Zero
Carbon target through eliminating tailpipe
GHG emissions and procuring renewable
electricity certificates equivalent to the
charging electricity requirements.
For more information, see:
Standards and Policies,
including Code of Ethics, on
page 42.
Streamlined Energy and
Carbon Reporting, on
page 233.
Remuneration Report, from
page 112.
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People and Sustainability
We are now operating over 14,000 BEVs
globally and we are on track to achieve our
target to transition 100% of our company-
owned and leased vehicles to BEVs where
technically feasible by the end of 2025.
The global transition is being delivered
while some markets are experiencing
challenges with the supply of vehicles and
the availability of charging infrastructure.
Site F-gas management
F-gases released during the production
process of current pMDI medicines are
reported as part of our Scope 1 GHG
footprint and accounted for 80% of our
global Scope 1 F-gas emissions in 2024,
making them the priority for mitigation.
Through a process change involving
purging empty canisters in a vacuum
instead of using a propellant, we have
significantly reduced F-gas emissions.
A second reduction initiative of capturing
F-gas emissions from the production
process, using cryogenic technology that
liquefies the gases, has been scaled up
during 2024, enabling the storage and
removal from site for either incineration
or recycling.
Energy efficiency and renewable energy
We have used Climate Group’s RE100
corporate renewable energy initiative
quality criteria as a robust baseline on
which we have developed internal
standards and scoring mechanisms for
energy sourcing proposals – not only for
electricity but also heat and fuels. Focus
areas include targeting new-to-grid
renewable energy capacity (additionality),
energy purchase agreements that displace
fossil energy sources close to where we
consume that energy (geographic
relevance), and investigating how to
improve the alignment between when our
energy is generated and consumed
(temporal relevance) to improve utilisation
and deliver GHG emissions reductions. We
have achieved a 20% absolute reduction in
total energy consumption at sites from our
2015 baseline and our target is to use 100%
renewable energy sources to meet all our
needs by the end of 2025.
Clean power
On-site solar photovoltaic installations
We recognise the benefits of self-generated
renewables to site energy costs, resilience,
temporal relevance and employee
engagement, and have invested in on-site
solar photovoltaic (PV) installations at 20
locations in 11 countries. Once operational,
the total output from all our on-site solar PV
will be 21,000 megawatt hours of electricity,
equivalent to 3% of our global electricity use.
Power Purchase Agreements
There is a limit to the scale that can be
achieved through on-site solar PV, and
so to deliver additional renewables with
geographic and temporal relevance in line
with our focus areas, we are aiming to meet
most of our electricity needs in our primary
locations – Sweden, the UK and US –
through Power Purchase Agreements
(PPAs) in the grids where we operate.
At the beginning of 2024, a 10-year PPA
came into effect with Statkraft, Europe’s
largest renewable energy producer, to
source electricity from three new wind farms
in Sweden that will supply 200 gigawatt
hours (GWh) per year from new-to-grid
projects. This provides additional zero
carbon electricity to the grid and is
expected to correspond to approximately
80% of our total electricity needs at our
Gothenburg and Södertälje sites.
Fuel switching (clean heat)
AstraZeneca signed a clean heat
agreement in March 2024 to decarbonise
our medicines manufacturing in China.
Through this agreement, biomethane and
biomethane-based steam will be supplied
to our Wuxi manufacturing site, supporting
the broader decarbonisation of the
healthcare system.
Since 2023, we have been collaborating
with Vanguard Renewables to enable the
delivery of renewable natural gas (RNG
– biomethane) to all of our sites in the US
by the end of 2026, launching at our
Newark campus in Delaware. By 2026, this
collaboration is expected to enable up to
230 GWh per year of RNG to be used across
AstraZeneca’s US sites, equivalent to 46%
of our total global gas consumption.
As part of our 15-year agreement with
Future Biogas, in 2024 construction
progressed on the first unsubsidised supply
of biomethane in the UK, to our sites in
Macclesfield, Cambridge, Luton and Speke.
The new plant will add renewable energy
capacity to existing UK infrastructure and is
expected to supply more than 100 GWh of
biomethane, equivalent to 20% of our total
global gas consumption.
Scope 3 Decarbonisation levers
Product manufacture
Manufacturing products is responsible
for a significant proportion of our Scope 3
footprint and decarbonising products is a
key pillar of our strategy to achieve our
2030 Scope 3 target. This will include
collaborating with manufacturers of APIs
used in our medicines, to identify
opportunities for eliminating, reducing or
substituting sources of GHG emissions.
Interventions to decarbonise must be
guided by data such as that from product
Life-Cycle Assessments (LCAs). Similarly,
the requirements for eco-design will be
incorporated into new product development.
We are also participating in initiatives
including the Activate programme, which
brings global pharmaceutical companies
together with suppliers to decarbonise API
supply chains, and Energize, which is
increasing access to renewable sources of
energy at scale for pharmaceutical suppliers.
Non-product supplier emissions
To address the Scope 3 footprint associated
with purchased goods and services procured
outside of product manufacture, we must
understand the relative GHG emissions of
activities across a diverse set of categories,
from clinical trials to professional services
and advertising. This will involve identifying
emission hotspots for collaborative action
and a drive towards improved activity-based
emissions data. Efforts to reduce emissions
across our supply chain include advocating
that suppliers set SBTs of their own to
reduce the environmental impact of the
products and services supplied, cascading
these expectations up the value chain and
prioritising the use of renewable energy
in their operations as an effective
decarbonisation lever.
Product use
Chronic respiratory diseases such as
asthma and COPD are complex, difficult to
treat and often poorly controlled and are
associated with a greater carbon footprint
of care. As part of our efforts to provide
patients with access to treatment with a
lower carbon footprint, in 2024, we
continued to focus on the next-generation
propellant (NGP) transition for pMDI
For more information,
see Streamlined Energy
and Carbon Reporting on
page 233.
Climate change
continued
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continued
through our global AZ Forest initiative,
which aims to mitigate the effects of climate
change while also delivering multiple
ecological, health, economic and community
co-benefits. We do not purchase land for
reforestation or own the trees but have the
rights to carbon certificates generated by
some projects.
Climate adaptation and resilience
We follow the science to manage the risks
and opportunities presented by climate
change and to build resilience against any
such risks. The strategy for adaptation to
physical climate risks is aligned to a
high-emission scenario for significant sites,
so that the Group builds resilience under a
worst-case scenario. Our climate strategy
is designed to address transition risks and
opportunities in a low-carbon scenario and
a pathway aligned with our SBTs of limiting
global warming to 1.5°C. The Group
products in our respiratory portfolio. pMDIs
deliver essential, life-saving medicines for
millions of people living with respiratory
diseases worldwide. The new propellant
HFO-1234ze(E) has up to 99.9% less Global
Warming Potential (GWP) than propellants
currently used in respiratory medicines,
which makes the transition to the NGP a key
product-related element of our Ambition
Zero Carbon strategy. In 2024, project
milestones achieved included completion
of key registrational studies and the first
regulatory filing submissions of our NGP
with
Breztri
/
Trixeo
in COPD to the EU, UK
and China with further filings anticipated
in 2025.
Transport – distribution and
business travel
Product distribution is another key focus
area within our Scope 3 footprint that we
will work to decarbonise to meet our 2030
Scope 3 target. This category of suppliers
has a specific target to set SBTs by the
end of 2025 to establish decarbonisation
pathways which will inform actions. A modal
switching programme is underway that aims
to switch key distribution routes from air
freight to sea freight and we will look to
maximise its potential to deliver our
emissions target. We will also support
innovation for alternative technologies
and fuels where the whole life-cycle
sustainability impact can be demonstrated
and quantified.
Employee business travel is a small but
visible part of our Scope 3 emissions. New
ways of working established in recent years
have demonstrated that business travel can
be reduced through efficient scheduling
and target-setting, supported by
management information providing
visibility across the organisation.
Carbon removals
Recognising the urgency of the climate
crisis, we have investigated how we can
supplement our emission reduction targets
and activities by also taking responsibility
for all our residual emissions. This requires
modelling our future emissions and
establishing high-quality climate projects
of sufficient scale and quality to remove
the equivalent amount of carbon dioxide
from the atmosphere.
For our Scope 1 and 2 emissions we aim
to balance the residual footprint from 2026
onwards and for our Scope 3 emissions
from 2030. Projects identified to date
include our $400 million multi-year
investment in nature-based solutions
considers that it has built resilience into its
strategy to respond to transition and physical
risks identified on pages 56 and 57.
In line with the guidance from the Task Force
on Climate-related Financial Disclosures,
we used a low/medium/high case scenario
based on the Intergovernmental Panel on
Climate Change scenarios, namely Shared
Socioeconomic Pathways (SSPs) and
Representative Concentration Pathways
(RCPs). See page 236 for details. The
identification and assessment of climate risk
forms part of our existing risk management
processes and as of 2024, the time horizons
have also been updated to align; see page
64 for our Risk Overview.
Next-generation
immuno-oncology
bispecifics
Bispecific antibodies are engineered to
bind to two different epitopes, or antigens,
at the same time. Next-generation
immuno‑oncology (IO) bispecifics will
play a crucial part in shaping the future
of medicine in many fields. We are working
to expand immuno-oncology treatments
beyond existing PD-L1 inhibitors and, in
particular, are developing IO bispecifics
that combine the potential of PD-1 together
with additional targets that harness distinct
T-cell biology, bringing the power of
immuno-oncology into one molecule.
By harnessing our broad oncology
portfolio, we have the opportunity to
combine bispecifics with other targeted
therapies, such as ADCs, with the aim of
transforming the outcomes of cancer
diagnoses for patients.
Investing in transformative R&D technologies
Corporate Governance
Additional Information
Financial Statements
Strategic Report
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People and Sustainability
Key
Low risk
Time horizon for impact
Medium risk
Short: one year
High risk
Medium: up to three years
Opportunity
Long: more than three years
Physical risks
Since 2020, we have completed a deep
dive risk assessment for all significant sites.
These assessments are based on a broad
range of climate scenarios (SSP1-RCP2.6,
SSP2-RCP4.5 and SSP5-RCP8.5) but focus
on a worst-case assessment from actual
and future events. Where appropriate, the
risk mitigation measures and interventions
are escalated to site management and
captured on the local risk register. Identified
risks are addressed in local business
continuity plans or by technical mitigations
in site master plans. Mid- and long-term
financial planning includes required
investments. In 2024, we complemented
our existing assessments with a review of
office-based locations at high climate risk
locations. For new, significant sites, we are
integrating adaptation solutions which
reduce the most important physical risks at
the time of design and construction before
operating at the site, such as elevating the
site floor in response to flood risk.
In 2022, chronic and acute physical risks
were mapped to the supply chain, based on
location, and then assessed using climate
scenarios in the same way as for our own
locations. The data has been used to map
vulnerabilities in the unique supply chain
for 10 selected medicines. We have also
reviewed third-party owned distribution
centres in high-risk areas. These locations
Physical risks
Time horizon
Short/Medium/Long
Potential impact
Mitigation
Acute
Event-driven
climate-related
physical risks
(e.g. flood, high
wind speed).
Natural disasters can lead to immediate
damage and business interruption to
our own operations or suppliers.
Examples of this damage include:
•
Heavy rainfall causing local flooding
and resulting in flooded assets.
•
High wind events resulting in
damaged site structures.
Increased resilience to mitigate exposure to acute extreme weather events.
Identified risks are integrated into local business continuity and mitigation
plans and are covered by supply chain design (e.g. dual sourcing, holding
safety stock) as part of product-level business continuity management.
Nature-based mitigations are favoured where possible, e.g. storm water
buffering ponds.
Chronic
Increased
frequency of
extreme weather
and climate-related
natural disasters
(e.g. extreme heat,
wildfires,
precipitation
patterns, water
scarcity, water
quality).
Disruption to own and third-party
supplier sites and distribution due to:
•
Increased exposure to extreme
heat events and an increased need
for cooling.
•
Inability to secure a consistent
high-quality water supply, which may
lead to disruption of manufacturing
and supply chain activity.
Increased resilience to mitigate exposure to longer-term shifts (chronic) in
climate patterns. Identified risks are integrated into local business continuity
and mitigation plans and are covered by supply chain design (e.g. dual
sourcing, holding safety stock) as part of product-level business continuity
management. Nature-based mitigations are favoured, where possible.
Ongoing efforts to decouple water use from business growth, including
targets to decrease water demand from products and sites.
For more information, see
Risk Overview from page 64.
have been added to a global risk register
with a risk mitigation plan in place
where needed.
Physical risks from climate change
primarily relate to disruption or delays to
manufacturing and/or distribution, including
cold chain logistics, increased insurance
premiums, reputational damage and other
resulting consequences.
Climate change
continued
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Transitional
risks and
opportunities
Time horizon
Short/Medium/Long
Potential impact
Mitigation
Reputation
Failure to meet
our sustainability
targets,
regulatory
requirements and
stakeholder
expectations.
Failure to deliver on our commitments
could impact our reputation and put us
at a commercial disadvantage relative
to our peers.
Reduction plans for Scope 1, 2 and 3 net-zero emissions are integrated in our
internal governance model, with Scope 1 and 2 reduction plans integrated in
our remuneration programme. Reduction plans for Scope 3 emissions are
established in contractual agreements with suppliers.
Required investments in the respiratory portfolio and in nature-based removal
projects for residual emissions are approved.
Progress against targets is part of external reporting. For more details, see the
2024 Risk Supplement on our website: www.astrazeneca.com/annualreport2024.
Market
Transition to
net-zero
healthcare
systems.
Some healthcare providers are
transitioning to net-zero healthcare
systems to meet their own climate
targets, which may alter the demand
for medicinal products based on their
carbon footprint.
Reduction plans for Scope 1, 2 and 3 net-zero emissions integrated in internal
governance model, with Scope 1 and 2 reduction plans integrated in our
remuneration programme.
Requirements for eco-design have been incorporated into new
product development.
AstraZeneca’s LCAs and Product Sustainability Index (PSI) for medicines
enable assessment and proactive interventions to reduce the environmental
footprint of medicines.
Policy and Legal
New EU F-gas
Regulation.
The final EU F-gas Regulation includes
the necessary safeguards allowing us
to transition our pMDI portfolio to our
NGP, which has near-zero GWP,
by 2030.
Transition to near-zero GWP propellant across our respiratory pMDI portfolio
by 2030, reducing the risk of F-gas exposure with opportunity to maintain
patient access to inhaled respiratory medicines delivered by pMDIs.
The transition to the NGP is expected to maintain continuity for pMDI
medicines, while delivering a lower environmental impact.
We are committed to completing this work as quickly and safely for patients as
possible. For more information from page 54.
Policy and Legal
Uncertainty over
carbon pricing
and future
environmental
taxation.
Potential for increased carbon pricing
and environmental taxation driving
increased costs, but also a commercial
opportunity if managed correctly.
Our Ambition Zero Carbon strategy drives decarbonisation in our operations
and wider value chain, mitigating some exposure to future carbon pricing and
environmental taxation.
We monitor market developments for carbon pricing to inform our strategy.
Market
Supply/demand of
renewable energy.
Ensuring access to renewable energy
requires higher investments and
changes in geopolitics can lead to
loss of access, which causes
increased costs.
By reducing energy consumption at sites by 20% and achieving a 77.5%
reduction in Scope 1 and 2 (market-based) emissions since 2015, we are
reducing our exposure to incremental costs of renewable energy alternatives.
Collaboration with key organisations to scale renewable energy sources and
secure access to supply chain.
Market
Cost of raw
material/sourcing,
and low-carbon
technologies.
Impact of rising costs of raw material or
sourcing, and transition to low-carbon
technologies, on our supply chain.
Engagement with strategic supply chain organisations on their transition to a
low-carbon economy.
Costing for drugs considers transition-related risks, such as fuel costs and
changes to approval mechanisms.
Some carbon costs are factored into decision making.
Transition risk and opportunities
Transition risks and opportunities are
primarily regulatory and market changes,
technology shift and/or pressure, and ability
to reduce product carbon footprints and
decarbonise our value chain.
To understand the financial consequences
of the transition to a low-carbon economy,
risks and opportunities are assessed both
at enterprise and product levels, including
prioritised medicines where LCA data
is available.
Through scenario analysis, risks and
opportunities were identified to now cover
medicines in the therapy areas of Oncology,
CVRM and R&I to see how drivers such as
regulations, access to renewable energy,
technology shifts, market expectations and
reputational aspects can impact our
financial forecast. In addition, transition
risks and opportunities have been identified
at enterprise level for transportation,
renewable energy and raw materials
represented by F-gases used in our
inhaled respiratory portfolio.
The climate scenarios used are described on
page 236. Significant findings are reflected
in the financial planning process. Investments
in GHG reduction and removal projects will
be balanced out against maintaining revenue
and avoiding costs of future regulations,
carbon taxation and customer requirements
in a low-carbon economy.
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Financial Statements
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People and Sustainability
Delivering medicines to patients leads to
pharmaceuticals in the environment (PIE),
which are APIs resulting mainly from patient
use and absent or ineffective removal from
wastewater, as well as improper disposal of
medicines and waste from production.
We have ongoing programmes and
processes across the value chain to
minimise the impact of PIE, as part of
our ambition to lower the economic and
environmental burden of healthcare, while
improving health outcomes and reducing
our exposure to environmental risks. To
understand the risks of PIE resulting from
patient use and disposal, we complete
Environmental Risk Assessments (ERAs)
before the approval of a new medicine
and, using experimental data, identify
safe concentrations of our APIs. These
demonstrate that PIE resulting from most
of our products pose a low or insignificant
environmental risk and are unlikely to
cause adverse impacts. The data meets the
international standards set by regulators
and summaries of the results and ERAs
are published on our website,
www.astrazeneca.com/sustainability/
resources.html. The data and safe
concentrations are also utilised to manage
our own and contracted manufacturing
emissions, ensuring risks from our supply
chain are minimised.
Product Sustainability Index
Our internal Product Sustainability Index
(PSI) is a key contributor to our management
of pollution through using PIE as a metric
for impact under water releases. The PSI
indicates a product’s environmental
footprint across six environmental impact
categories: carbon, power, water resource,
water releases, resource use, and
innovation and improvement.
EcoPharmacoVigilance
Our EcoPharmacoVigilance (EPV) approach
reviews emerging science and peer-reviewed
literature to inform and improve our ERAs
associated with our APIs. We collate and
publish relevant reported measurements
of our medicines in the environment to
demonstrate transparently our potential
impact. Our industry-leading dashboard,
where users can visualise the relative risks
of our APIs that are found in the environment,
is available on our website. When our APIs
have been detected, in almost all cases
these APIs have been shown via our EPV
process to pose low or insignificant
environmental risk. There can be some
location-specific environmental risks for
particular pharmaceuticals, especially in
regions where there may be inadequate
sewage treatment and high populations
of people discharging waste into rivers
with low-dilution conditions.
Improper disposal
Our ERAs account for disposal through
worst-case assumptions about disposal of
unused medicines. However, to tackle the
improper disposal of unused pharmaceuticals
we also encourage our patients to return
unwanted medicines for safe disposal.
IHI PREMIER
As part of our commitment to drive thought
leadership and innovation to manage PIE,
we are the industry lead of the IHI PREMIER
consortium, a public-private partnership
between the European Commission and
EFPIA. PREMIER is helping develop tools to
identify potential environmental risks of APIs
and make these tools and data more
accessible to all stakeholders. Through our
sector-wide collaborations, such as the
PREMIER project, we are exploring the
challenge of developing new medicinal
products which are both safe and effective
in patients and have less environmental
impact after use. Taking environmental
considerations into account in the R&D
process is feasible. However, the properties
which make medicines safe and effective
for patients are not always fully compatible
with properties which present the lowest
risk in the environment. Therefore, while
we are progressing with considerations
which lower the pollution impact of new
medicines, a prerequisite is the explicit
recognition that patient health should not
be compromised.
Potential restriction of PFAS in Europe
The European Chemical Agency is currently
evaluating a proposal to ban PFAS, often
referred to as ‘forever chemicals’ in the EU.
The proposal potentially impacts a family
of more than 10,000 chemicals across many
industries. However, not all PFAS present
the same risks to the environment or
health. PFAS are widely used in the
biopharmaceutical industry, and it may
not be possible to substitute all of them.
Legislators have signalled a willingness
to protect APIs in medicines and take a
sector-based approach to the legislation.
Importantly, the medical grade HFO-
1234ze(E), AstraZeneca’s NGP with
near-zero GWP, is backed by comprehensive
evidence that shows it is rapidly broken down
in the environment, is non-bioaccumulative
and non-toxic, and therefore does not
possess the properties that are the stimulus
for the legislation. Unsaturated molecules
such as HFO-1234ze(E) do not fall under the
definition of PFAS by other environmental
regulatory agencies, such as the US
Environmental Protection Agency. We are
working with authorities and relevant
stakeholders to ensure the differential
characteristics of HFO-1234ze(E) are
recognised in the regulations and they
fully account for patient needs and public
health while protecting the environment.
Pollution
Pollution comprises the introduction
of pollutants into the environment
which may be harmful, including
to human health. For AstraZeneca,
key potential pollutants include
APIs and per- and polyfluoroalkyl
substances (PFAS). Reduction of
chemical pollution, including from
pharmaceuticals, is a societal
challenge as recognised by the
development of a United Nations
science policy panel on chemicals,
waste and pollution prevention.
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continued
Our approach to sustainability reporting
BV
Our sustainability reporting is prepared in line with the UK Companies Act 2006, the EU Non-Financial
Reporting Directive, EU Taxonomy on Sustainable Activities and the recommendations of the Task Force
on Climate-related Financial Disclosures (TCFD). In anticipation of the EU Corporate Sustainability
Reporting Directive (CSRD), we have conducted a double materiality assessment and have incorporated
selected disclosures from the European Sustainability Reporting Standards in this Annual Report.
In this section, we present our approach
to sustainability reporting, Section 172(1)
statement, and Viability statement.
UK statutory sustainability
reporting
Non-Financial and Sustainability
Information Statement and the
TCFD recommended disclosures
Under sections 414CA and 414CB of the
UK Companies Act 2006, as introduced by
the Companies, Partnerships and Groups
(Accounts and Non-Financial Reporting)
Regulations 2016 and amended by the
Companies (Strategic Report)
(Climate-
related Financial Disclosure) Regulations
2022, AstraZeneca is required to include
in its Strategic Report, a non-financial and
sustainability statement containing
certain information.
The areas listed below include references
to our relevant policies, due diligence
processes and information on how we
are performing against various measures.
Information on the key non-financial
performance indicators relevant to our
business are presented alongside the
material sustainability matters.
•
Business model, page 10 and 11
•
Environmental matters, pages 53 to 58
•
Climate-related disclosures, pages 53
to 57, 233, 235 to 236.
•
Employees, page 48 to 50
•
Social matters, pages 38 and 52
•
Human rights, page 48
•
Anti-corruption and anti-bribery matters,
pages 42 and 43
•
Principal risks, page 64 to 66.
We have made disclosures within the
Annual Report consistent with the four
recommendations of the TCFD, the 11
recommended disclosures and all sector
guidance, and in compliance with the
requirements of UK Listing Rule 6.6.6(8)
of the UK Financial Conduct Authority.
The table on this page sets out the required
climate-related financial disclosures from the
TCFD framework and UK Companies Act
2006, section 414CB, and shows where
further information can be found.
BV
TCFD recommendations and
recommended disclosures
UK Companies Act 2006, section 414CB
Page
Governance
Describe the Board’s oversight of
climate-related risks.
Describe management’s role in assessing
and managing climate-related risks and
opportunities.
Description of the company’s governance
arrangements in relation to assessing and
managing climate-related risks and
opportunities.
53
103
104 to 111
Strategy
Describe the climate-related risks and
opportunities the organisation has
identified over the short, medium and
long term.
Description of:
(i) the principal climate-related risks and
opportunities arising in connection with
the company’s operations, and
(ii) the time periods by reference to which
those risks and opportunities are
assessed.
55 to 57
64
236
Describe the impact of climate-related risks
and opportunities on the organisation’s
businesses, strategy and financial planning.
Description of the actual and potential
impacts of the principal climate-related risks
and opportunities on the company’s business
model and strategy.
Describe the resilience of the organisation’s
strategy, taking into consideration different
climate-related scenarios, including a 2°C
or lower scenario.
An analysis of the resilience of the company’s
business model and strategy, taking into
consideration different climate-related
scenarios.
Risk management
Describe the organisation’s processes
for identifying and assessing climate-
related risks.
Description of how the company identifies,
assesses, and manages climate-related risks
and opportunities.
55 to 57
64
Describe the organisation’s processes for
managing climate-related risks.
Describe how processes for identifying,
assessing and managing climate-related
risks are integrated into the organisation’s
overall risk management.
Description of how processes for identifying,
assessing, and managing climate-related
risks are integrated into the company’s
overall risk management process.
Metrics and targets
Disclose the metrics used by the
organisation to assess climate-related risks
and opportunities in line with its strategy
and risk management process.
Description of the key performance
indicators used to assess progress against
targets used to manage climate-related risks
and realise climate-related opportunities and
of the calculations on which those key
performance indicators are based.
53
233
235
Disclose Scope 1, Scope 2 and, if
appropriate, Scope 3 GHG emissions,
and the related risks.
Description of the targets used by the
company to manage climate-related risks
and to realise climate-related opportunities
and of performance against those targets.
Describe the targets used by the
organisation to manage climate-related
risks and opportunities and performance
against targets.
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Disclosure Statements
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Disclosure Statements
EU Corporate Sustainability
Reporting Directive
In 2023, the EU CSRD entered into force.
The new directive aims to provide investors
and other stakeholders with information
about companies’ sustainability-related
impacts, risks and opportunities.
AstraZeneca PLC is in scope of the CSRD
from the 2025 financial year due to its listing
on Nasdaq Stockholm, an EU-regulated
market. In preparation for future reporting
requirements, we are disclosing the
outcomes of our double materiality
assessment and selected disclosures from
the European Sustainability Reporting
Standards in this Annual Report.
Double materiality assessment
The EU CSRD mandates companies in
scope of the directive to conduct a double
materiality assessment. The assessment
identifies sustainability-related risks and
opportunities to a company and a
company’s impacts on people and
the environment.
AstraZeneca performed a Group-level
double materiality assessment in 2024.
The Group’s impacts on people and the
environment were identified through
research using a variety of sources such
as sector guidance and benchmarking,
as well as understanding the interests and
views of stakeholders through dialogue.
Negative and positive impacts were initially
scored using results of due diligence
findings, internal assessments and
research, based on factors such as scale,
scope, irremediability and likelihood.
Subsequently the assessment was
confirmed by internal and external
stakeholders. External stakeholders
represented patient groups, suppliers,
investors, academia and non-governmental
organisations. Their input was used to refine
and validate the assessments and scores.
BV
The Group’s capital expenditure (Capex)
and operating expenditure (Opex) is also
eligible for four other activities included in
the Climate Delegated Act, with the most
significant being activity 7.1 Construction
of new buildings.
Capex was assessed for Taxonomy-
eligibility on a project basis. Projects were
assessed for alignment based on a set
quantitative threshold. Opex was assessed
for Taxonomy-eligibility based on the
nature of the expense.
Alignment assessment
Substantial contribution
Manufacture of medicinal products
The Manufacture of medicinal products
criteria requires that products be both
degradable
1
and a substitute for an
existing non-degradable product, in order
to be aligned.
The Group’s portfolio of eligible products
includes both biologics active pharmaceutical
ingredients (APIs) and small molecule APIs.
Innovative medicines by their very nature
are not alternatives to existing products,
hence they do not meet the substantial
contribution criteria. Eligible products where
the APIs are small molecules are generally
considered to be not readily biodegradable.
The biologics used in the Group’s APIs are
mostly naturally occurring and generally
considered to be degradable. However, in
some instances excipients used in products
may not be considered degradable.
We have therefore assessed that, overall,
our products do not meet the substantial
contribution criteria and are not aligned
for the Manufacture of medicinal
products activity.
The identification and assessment of
sustainability-related risks and opportunities
was carried out based on prevailing
exposures, taking account of mitigations in
place at the reporting date. This approach
is aligned to the Group’s risk management
framework (see page 64 for our Risk
Overview). The double materiality
assessment utilised quantitative and
qualitative thresholds, aligned with the
Group’s risk appetite, to determine material
sustainability topics. The assessment was
then reviewed by representatives of the
SET and the Board.
For information on the impact of material
sustainability topics on the Group’s financial
statements, see the Group Accounting
Policies in the Financial Statements from
page 152.
EU Taxonomy Disclosure
The EU Taxonomy (Regulation (EU)
2020/852) and associated Delegated
Acts represent an evolving classification
system for sustainable economic activities.
An economic activity is Taxonomy-eligible
if it is described in the Taxonomy Delegated
Acts. An economic activity is Taxonomy-
aligned if it makes a substantial contribution
to one or more of the specified
environmental objectives, meets specified
‘Do no significant harm’ (DNSH) criteria
and is carried out in compliance with
minimum safeguards.
Eligibility assessment
The Group has identified its Taxonomy-
eligible activities by screening the economic
activities in the Climate Delegated Act and
the Environmental Delegated Act.
The Group is eligible for a revenue
generating economic activity included
in the Environmental Delegated Act for
the environmental objective of Pollution
prevention and control (PPC), namely, PPC
1.2 Manufacture of medicinal products.
BV
1
Whilst the criteria do refer to an alternative pathway where a product within a substance class cannot be degradable, it demands that the manufacturer performs an analysis that
there is no degradable option for the product, publishes the core results of that analysis and demonstrates that they started initiatives to develop that alternative. As we have not
performed this in the year, we have dismissed this pathway.
Science and Innovation
•
Sustainable innovation, see page 37.
•
Patient safety and product quality,
see page 38.
Growth and Therapy
Area Leadership
•
Business conduct, see pages 42 and 43.
•
Cybersecurity and data privacy, see
page 45.
People and Sustainability
•
Talent attraction and retention,
see page 49 and 50.
•
Accessible and affordable healthcare,
see page 52.
•
Climate change, see pages 53 to 57.
•
Pollution, see page 58.
Our material sustainability topics
BV
The following sustainability topics were assessed as material in our double materiality assessment.
Disclosures relating to these topics can be found in the Business Review, from page 32.
60
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Strategic Report
Disclosure Statements
continued
Identification of economic activities
in the Taxonomy which are in scope
for the Group.
Action
Step
Activities
Assessment of whether identified in scope
activities meet the activity-specific criteria
to qualify as substantially contributing
to an environmental objective.
Assessment of whether activities which
contribute substantially to an environmental
objective, do no significant harm to other
environmental objectives.
Assessment of minimum safeguards
at the Group level for specified social
and governance areas.
Calculation of proportions of aligned
Revenue, Capex and Opex.
Eligibility
1
Substantial
contribution
2
Do no
significant harm
3
Minimum
safeguards
4
Alignment
5
Sustainable use and protection of water
and marine resources and Pollution
prevention and control
The Group has assessed relevant sites
against the technical specifications and,
in specific cases, the criteria have been
met as part of being expected to achieve
the LEED (Gold level) label. However, for
certain construction sites based outside
the EU, an equivalent Environmental Impact
Assessment (EIA) as would be required
within the EU is not available or locally
mandated for those sites, hence criteria
have not been met.
Transition to a circular economy
The Group expects to incorporate circular
economy principles in the construction of
new buildings and renovation of existing
buildings as part of those projects being
expected to achieve a LEED (Gold level) label.
However, for some projects the relevant
DNSH criteria have not been met, hence
they are considered to be not aligned.
Protection and restoration of biodiversity
and ecosystems
For activity 7.1, EIAs have been completed
for specific construction sites and we have
assessed these against the criteria. For
certain sites based outside the EU, an
equivalent EIA as that which would be
required within the EU, is not available or
locally-mandated for those sites and
therefore the Group has assessed these
sites as not aligned with the criteria.
A proportion of activity 7.2 Renovation
of existing buildings has been assessed
as aligned in 2024. Double-counting was
avoided by reconciliation to underlying
financial records and only assessing
activities substantially contributing to
a single environmental objective.
Minimum safeguards
The Group has performed an assessment
of its compliance with the minimum
safeguards criteria against published
documents. These cover four key topics:
•
Human Rights (including Labour and
Consumer Rights)
•
Anti-bribery and anti-corruption
• Taxation
•
Fair Competition.
The Group’s Values, incorporated in the
Code of Ethics (the Code), are the foundation
of our compliance with the minimum
safeguards, which are expanded through our
policies and practices including our Global
Standard on Expectations of Third Parties
and Group’s Approach to Taxation. Our
commitment to human rights is formalised
in the Code and we integrate human rights
considerations into our processes and
practices. We do not tolerate bribery and
corruption and violation of fair competition.
The Group publishes its Approach to
Taxation annually and we aim to pay the right
amount of tax in compliance with all relevant
tax law and regulations in every country in
which we operate and do not tolerate tax
evasion or facilitation of tax evasion.
Construction of new buildings
Climate change mitigation
The Group is eligible where it is constructing
new buildings. These buildings are
expected to be aligned with a major
environmental standard, namely Leadership
in Energy and Environmental Design (LEED)
Gold level. From the specifications expected
to be met, the criteria related to Primary
Energy Demand and life-cycle Global
Warming Potential have been fulfilled. The
Group expects to adopt robust controls for
building airtightness and thermal integrity
on newly-constructed sites. The specific
projects which the Group has assessed
have therefore met the relevant substantial
contribution criteria.
Renovation of existing buildings
Climate change mitigation
A renovation of an existing building project
was analysed under the Taxonomy’s
technical screening criteria. The renovation
is designed to achieve a net Primary Energy
Demand saving of more than 30%. Hence,
this project meets the relevant substantial
contribution criteria.
Do no significant harm
Climate change adaptation
Sites which have met the substantial
contribution criteria are included in the
physical climate risk assessment. The
Group’s assessment has identified no
material physical climate risks and therefore
this has been assessed to be aligned. For
further information on the Group’s physical
climate risk assessment see page 56
.
For more information, see:
Human rights, on page 48.
Anti-corruption and
anti-bribery matters, on pages
42 and 43.
Standards and Policies, including
Code of Ethics, on page 42.
AstraZeneca’s Approach to
Taxation can be found on our
website, www.astrazeneca.com/
sustainability/resources.html.
Key
Manufacture of
medicinal products
Construction
of new buildings
Renovation of
existing buildings
Acquisition and
ownership of buildings
Transport by motorbikes,
passenger cars and light
commercial vehicles
EU Taxonomy assessment process
61
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Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Disclosure Statements
Capital expenditure
The Taxonomy-eligible Capex KPI is defined
as Taxonomy-eligible Capex divided by
Total Capex.
•
Taxonomy-eligible Capex is Capex
related to assets or processes associated
with Taxonomy-eligible activities.
Purchase of IP, marketing and distribution
rights over medicinal products is
considered in total for Taxonomy-
eligibility under the activity ‘Manufacture
of medicinal products’.
•
Total Capex corresponds to the total
of the ‘Additions through business
combinations’ and ‘Capital expenditure’
movement types, the total of the
‘Additions – separately acquired’
and ‘Additions through business
combinations’ movement types as
detailed in Note 7 – Property, plant
and equipment (page 169), the total
of the ‘Additions – separately acquired’
and ‘Additions through business
combinations’ movement types as
detailed in Note 8 – Leases (page 170),
and the total of the ‘Additions – separately
acquired’ and ‘Additions through business
combinations’ movement types as
detailed in Note 10 – Intangible assets
(page 172).
The Group’s Taxonomy-eligible Capex KPI
for the year ended 31 December 2024 is
86% (2023: 83%).
Operating expenditure
The Taxonomy-eligible Opex KPI is defined
as Taxonomy-eligible Opex divided by
Taxonomy-defined Opex.
•
The Group’s Taxonomy-eligible Opex is
expenses related to assets or processes
associated with Taxonomy-eligible
economic activities. R&D expenses
associated with functional areas which
are involved directly in the manufacture
and procurement of medicinal products
are considered Taxonomy-eligible
under the activity ‘Manufacture of
medicinal products’.
•
The Group’s Taxonomy-defined Opex
is the total of R&D expenses, and other
direct non-capitalised costs that relate to
building renovation measures, short-term
leases, maintenance and repair, and any
other direct expenditures incurred in the
day-to-day servicing of property, plant
and equipment.
The Group’s Taxonomy-eligible Opex KPI
for the year ended 31 December 2024 is
18% (2023: 18%
1
).
EU Taxonomy Disclosure
continued
BV
BV
Interpretation of the EU Taxonomy and
company-specific assumptions are required
to fulfil the reporting requirements.
Revenue
The Taxonomy-eligible Revenue KPI is
defined as Taxonomy-eligible Revenue
divided by Total Revenue, which corresponds
to ‘Total Revenue’ in our Consolidated
Statement of Comprehensive Income as
detailed on page 148.
The Group’s Product Sales and sales
milestones within Collaboration Revenue
are associated with the manufacture of
medicinal products, which we consider in
total for Taxonomy-eligibility under the
activity ‘Manufacture of medicinal
products’. Consequently, our Taxonomy-
eligible Revenue KPI for the year ended
31 December 2024 is 96% (2023: 96%
1
).
Taxonomy eligibility and alignment
KPIs
Total
$m
Proportion of
Taxonomy-eligible
(non-aligned)
economic activities
Proportion of
Taxonomy-aligned
economic activities
Proportion of
Taxonomy-non-
eligible economic
activities
2024
2023
2024
2023
2024
2023
2024
2023
Revenue
54,073
45,811
96%
96%
1
0%
0%
4%
4%
Capex
7,755
4,918
86%
83%
2%
0%
12%
17%
Opex
14,130
11,380
18%
18%
1
0%
0%
82%
82%
1
For information on revised prior year amounts see EU Taxonomy templates in the Sustainability supplementary
information, from page 237.
The Group’s Taxonomy
eligibility and alignment are
summarised in the table above.
For more information, including
the EU Taxonomy templates in
Sustainability supplementary
information section, see from
page 237.
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Strategic Report
Disclosure Statements
continued
The Board and management engaged
with key stakeholders throughout the year
to understand the issues and factors that
are significant for these stakeholders, and a
number of actions were taken as a result of
this engagement. These interactions, and
impact thereof, are set out in the Connecting
with our stakeholders section from page 94
and throughout the Strategic Report.
We are committed to being a great place to
work for the global workforce. Details on
engagement with employees can be found
from page 48 of the Business Review, from
page 98 of the Corporate Governance
Report, page 107 in the Audit Committee
Report and page 131 and 132 of the
Remuneration Committee Report.
We are committed to employing high ethical
standards when carrying out all aspects of
our business globally. Our Code of Ethics
(the Code) is based on our Values, expected
behaviours and key policy principles. More
information on the Code can be found on
page 42.
We recognise patients as people first and
put them at the heart of what we do. Further
information on the importance of patients
to the business can be found on page 94.
The consideration and impact of the Group’s
operations on the environment and how the
Group has considered other factors, such
as communities and suppliers, can be found
throughout the People and Sustainability
section from page 47. Details of how the
Board operates and matters considered
by the Board are set out in the Corporate
Governance Report from page 91. Details on
the Board and SET composition and gender
diversity can be found on pages 48, 88, and
101. Examples of how Directors discharged
their duties and considered stakeholders
when making Principal Decisions during
2024 are set out from page 97. Principal
Decisions are decisions and discussions
which are material or strategic to the Group
and also those that are significant to our
key stakeholder groups.
Section 172(1) statement
The Board is required to promote the
success of AstraZeneca for the
shareholders and wider stakeholders
who interact with and are impacted by
our business.
Throughout the year the Directors have
considered the factors set out in section 172(1)
(a)-(f) of the UK Companies Act 2006, as well
as other factors relevant to the decision being
made. The Board acknowledges that not
every decision made will necessarily result in
a positive outcome for all stakeholders. By
considering our Purpose and Values, together
with AstraZeneca’s strategic priorities, the
Board aims to ensure that the decisions made
are consistent and intended to promote the
Company’s long-term success.
•
Principal Risks:
Pricing, affordability,
access, competitive pressures and
failures or delays in the quality or
execution of the Group’s commercial
strategies.
–
Scenario 1: Government action on
pricing, higher than anticipated
competition and other commercial
headwinds result in lower than
anticipated growth rates for our
medicines.
–
Scenario 2: A significant incident leads
to reputational damage in a key market
resulting in an ongoing 10% reduction
in revenue achieved in this market.
•
Principal Risk:
Failure or delay in the
delivery of our pipeline or launch of
new medicines.
–
Scenario 3: Assumes no launches
of new products.
•
Principal Risk:
Failure to maintain
supply of compliant, quality medicines.
–
Scenario 4: Major equipment failure or
significant regulatory observation at
one of our major manufacturing sites
results in a 12-month loss of
manufacturing capability for one of
our key oncology products, leading
to supply interruption.
•
Principal Risks:
Failure in information
technology or cybersecurity, adverse
outcome of litigation and/or government
investigations.
–
Scenario 5: Legal, regulatory, cyber
or other non-compliance results in a
payment of $500 million in 2026.
In addition, the Board has considered more
stressed scenarios, including restrictions on
debt factoring and no access to capital
markets to raise new debt. In each scenario
(or combination of scenarios above), the
Group is able to rely on its existing cash,
cash equivalents and short-term fixed
income investments, committed credit
facilities, leverage its cost base, reduce
capital expenditure and take other cash
management measures to mitigate the
impacts and still have residual capacity
to absorb further shocks.
Based on the results of this analysis, the
Directors have a reasonable expectation
that the Company will be able to continue
in operation and meet its liabilities, as they
fall due, over the three-year period of
their assessment.
Viability statement
In accordance with provision 31 of the
2018 UK Corporate Governance Code,
the Board has determined that a three-year
period to 31 December 2027 constitutes an
appropriate period over which to provide
its viability statement.
The Board assesses the Company’s
prospects using a 10-year long-range
projection. It notes the rich and varied
portfolio of medicines in development
across a range of therapy areas and the
medicines currently commercialised in
more than 100 markets, concluding that the
Company’s long-term prospects remain
strong. The Board also considers annually
and on a rolling basis, a three-year bottom-
up detailed business plan and, given the
inherent uncertainty involved, believes that
the three-year statement presents readers
of this Annual Report with a reasonable
degree of assurance over the ongoing
viability of the Company, while still
providing a longer-term perspective.
The three-year detailed business plan
captures risks to the sales and cost
forecasts at market and SET functional
levels. The plan is used to perform central
net debt and headroom-profile analysis.
The following scenarios have been applied to
this analysis to create a severe but plausible
downside combining a number of the
Principal Risks detailed on pages 65 and 66.
Our Risk Overview can be
found from page 64 to 66.
Full details are given in the Risk
Supplement on our website,
www.astrazeneca.com/
annualreport2024.
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Corporate Governance
Additional Information
Financial Statements
Strategic Report
Disclosure Statements
Managing risk
Our approach to risk management is
designed to encourage clear decision
making on which risks we take and how we
manage and mitigate these risks. We strive
to embed sound risk management within
our strategy, planning, budgeting and
performance management processes.
The Board defines the Group’s risk appetite.
This enables the Group, in both quantitative
and qualitative terms, to judge the level of
risk it is prepared to take in achieving its
overall objectives. The Board expresses the
acceptable levels of risk for the Group using
three key dimensions: (i) earnings and cash
flow, (ii) return on investment and (iii) ethics
and reputation. Annually, the Group
develops a detailed three-year bottom-up
business plan and 10-year long-range
projection to support the delivery of its
strategy. The Board considers these in
the context of the Group’s risk appetite.
Adjustments are made to the plan or risk
appetite to ensure they remain aligned.
The Senior Executive Team (SET) is
required by the Board to oversee and
monitor the effectiveness of the risk
management processes implemented by
management. Within each SET function,
leadership teams discuss the risks the
business faces. Quarterly, each SET
function assesses changes to these risks,
new and emerging, and mitigation plans.
These are assimilated into a Group Risk
Report for the Board, Audit Committee
and SET.
Global Compliance, Finance and Group
Internal Audit support the SET by advising
on policy and standard setting, monitoring
and auditing, communication and training,
as well as reporting on the adequacy of line
management processes as they apply to
risk management. The Board believes that
existing processes provide it with adequate
information on the risks and uncertainties
we face. The Board has carried out a robust
assessment of the emerging and Principal
Risks facing the Group. Our Principal Risks
are those risks that are most likely to
significantly impact delivery of our business
strategy or future performance and are a
subset of the total risk landscape facing the
Group. The table on pages 65 and 66
provides insight into these Principal Risks.
Emerging risks
Emerging risks are ‘new’ risks that have the
potential to crystallise in the future but are
unlikely to impact the business during the
next year. The outcome of such risks is
often more uncertain. They may begin to
evolve rapidly or simply not materialise.
We monitor our business activities and
external and internal environments for new,
emerging and changing risks to ensure
these are managed appropriately. Annually,
we combine input from each SET function
and external insight to scan the horizon for
emerging risks and a summary is presented
to the Audit Committee and the Board.
Emerging risks continue to be monitored
as part of the ongoing risk management
processes outlined above.
Climate risk
The identification and assessment of
climate risk form part of our existing risk
management processes. ‘Failure to meet
our sustainability targets, regulatory
requirements and stakeholder expectations
with respect to the environment’
incorporates climate risk within its scope
and is a component of the Group’s risk
landscape but is not currently considered
to be a Principal Risk for the Group.
We support the Task Force on Climate-
related Financial Disclosures (TCFD)
framework and continue to develop our
disclosures in line with its recommendations.
Our climate change disclosures from
page 53 summarise the work undertaken
to date to understand the potential impact
of climate change on our business and
outlines future areas of management focus.
Cybersecurity risk
Our approach to identifying, assessing
and managing material cybersecurity risks
(including those that result from the use of
third parties in business processes and
data management) is integrated within our
Group-wide approach to managing risk.
‘Failure in information technology or
cybersecurity’ has been identified as a
Principal Risk. Mitigations are in place to
manage these risks and these are monitored
and their effectiveness regularly reported,
for example, in KPI dashboards provided to
management and the Audit Committee.
Incidents are managed and reported using
the cybersecurity incident management
framework which in turn is connected to
the Group’s crisis management framework.
Cybersecurity risks are overseen by the
Audit Committee which performs an
in-depth review annually. Its reviews are
supported by senior management, the VP,
Group Internal Audit and other assurance or
providers as required. Cybersecurity risks
(including previous incidents) have not
materially affected our business strategy,
results of operations or financial condition.
“We strive to embed
sound risk management
in our strategy.”
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Annual Report & Form 20-F Information 2024
Strategic Report
Risk Overview
Risk category and Principal Risks
Context/potential impact
Management actions
Trend versus prior year
Product pipeline risks
Failure or delay
in the delivery
of our pipeline
or launch of
new medicines
The development of pharmaceutical product
candidates is a complex, risky and lengthy
process involving significant resources. A project
may fail at any stage of the process due to a
number of factors, which could adversely affect
our future business and results of operations.
•
Prioritise and accelerate our pipeline.
•
Strengthen pipeline through acquisitions,
licensing and collaborations.
•
Focus on innovative science in our main
therapy areas.
•
Improve R&D productivity.
Failure to meet
regulatory or
ethical
requirements
for medicine
development
or approval
We are subject to laws and regulations that
control our ability to market our pharmaceutical
products. Delays in regulatory approvals could
delay our ability to market our products and may
adversely affect our revenue.
•
Quality management systems
incorporating monitoring, training and
assurance activities.
•
Collaborating with regulatory bodies and
advocacy groups to monitor and respond
to changes in the regulatory
environment, including revised
processes, timelines and guidance.
Commercialisation risks
Pricing,
affordability,
access and
competitive
pressures
The pricing and market access environment is
highly complex and subject to dynamic economic,
political and social pressures. Deterioration in
socio-economic conditions may affect customers’
ability or willingness to purchase our medicines
and may adversely affect our business and
results of operations.
•
Implement pricing, reimbursement and
policy frameworks.
•
Focus on key products.
•
Demonstrate value of medicines/health
economics.
•
Implement innovative value-based
agreements focused on patient
outcomes.
•
Global footprint.
•
Diversified portfolio.
Failures or
delays in the
quality or
execution of
the Group’s
commercial
strategies
A failure to execute our commercial strategies
or achieve the level of sales anticipated for a
medicine could materially impact our
business results.
•
Focus on key products.
•
Substantial investment in sales
and marketing activities.
•
Accelerate execution of plans and risk
share through business development and
strategic collaborations and alliances.
Supply chain and business execution risks
Failure to
maintain
supply of
compliant,
quality
medicines
Supply chain difficulties may result in product
shortages which could lead to lost product sales
and materially affect our reputation and results
of operations.
•
Establishment of new manufacturing
facilities, creating capacity and technical
capability to support new product launches.
•
Contingency plans, including dual sourcing,
multiple suppliers and close monitoring
and maintenance of stock levels.
•
Business continuity and resilience
initiatives, disaster and data recovery,
and emergency response plans.
•
Quality management systems.
Failure in
information
technology or
cybersecurity
Significant disruption to our IT systems, including
cybersecurity breaches, or failure to comply with
applicable laws or regulations could harm our
reputation and materially affect our financial
condition or results of operations.
•
Cybersecurity incident management
framework and dashboard.
•
Disaster and data recovery plans.
•
Strategies to secure critical systems
and processes.
•
Regular cybersecurity and privacy
training for employees.
Growing
multi-faceted
cyber threat.
Failure to collect
and manage
data or AI in line
with legal and
regulatory
requirements
and strategic
objectives
There is an increasing range of legislative and
regulatory requirements to manage data across
all countries where we conduct business such
as restricting the movement of data between
countries or how we make use of new
technological capabilities such as AI. Failure to
protect data effectively or the inappropriate use
of technologies such as AI may lead to
competitive disadvantage and/or loss of trust
from key stakeholders, including patients, and
prevent us from reaching our strategic objectives.
•
Enterprise Data Council established.
•
Enterprise AI Governance Framework
and Standard established.
•
Data Privacy Framework and
privacy impact assessment
process implemented.
Proliferation of
more onerous data
regulation may
restrict, or require
changes to,
existing data
processing
practices.
Principal Risks
Strategy key
Science and Innovation
Growth and Therapy Area
Leadership
People and Sustainability
Achieve Group
Financial Targets
Trend key
Increasing risk
Decreasing risk
Unchanged
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Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Risk Overview
Risk category and Principal Risks
Context/potential impact
Management actions
Trend versus prior year
Legal, regulatory and compliance risks
Safety and
efficacy of
marketed
medicines is
questioned
Safety concerns relating to our products may
lead to recalls, seizures, interruption of supply
and loss of product approvals, which could
adversely affect patient access, our reputation
and our revenues. Significant product liability
claims could also arise, which may be costly,
divert management attention, reduce demand
for our products and damage our reputation.
•
Robust processes and systems in place
to manage patient safety and efficacy
trends as well as externally reported risks
through regulatory agencies and other
parties. This includes a comprehensive
pharmacovigilance programme
supplemented by close monitoring
and review of adverse events.
Adverse
outcome of
litigation
and/or
governmental
investigations
Our business is subject to a wide range
of laws and regulations around the world.
Actual or perceived failure to comply may
result in AstraZeneca and/or its employees
being investigated by government agencies
and authorities and/or in civil legal proceedings.
Government investigations, litigations,
and other legal proceedings, regardless of
outcome, could be costly, divert management
attention, or damage our reputation and
demand for our products.
Unfavourable resolutions to proceedings
against us could subject us to criminal liability,
fines, penalties or other monetary or non-
monetary remedies, including enhanced
damages, requiring us to make significant
provisions in our accounts relating to legal
proceedings, and could materially adversely
affect our business or results of operations.
•
Established compliance framework with
strong ethical and compliance culture.
•
Combined internal and external
counsel management.
Broadening of
government
investigations into
the healthcare
industry in China.
IP risks related
to our products
The pharmaceutical industry is experiencing
pressure from governments and other payers to
impose limits on IP protections to manage
healthcare costs. If we are unable to obtain,
defend and enforce our IP, we may experience
accelerated and intensified competition.
•
Active management of IP rights and
IP litigation.
Economic and financial risks
Geopolitical
and/or
macro-
economic
volatility
disrupts the
operation of
our global
business
Operating in more than 100 countries, we are
subject to political, socio-economic and financial
factors around the world. A sustained global
economic downturn may adversely impact our
business. Geopolitical tensions may lead to the
imposition or escalation of trade controls, tariffs,
taxes or other restrictions to market access, which
may increase our costs or reduce revenues.
•
Focus on key products.
•
Demonstrate value of medicines/health
economics.
•
Diversified portfolio.
Failure to
achieve
strategic plans
or meet targets
or expectations
Failure to successfully implement our
business strategy may frustrate the
achievement of our targets and materially
damage our brand, business, financial position
or results of operations.
•
Focus on key products and innovative
science in our core therapy areas.
•
Strengthen pipeline through acquisitions,
licensing and collaborations.
•
Appropriate capital structure and
balance sheet.
•
Portfolio-driven decision-making
process governed by senior executive-
led committees.
66
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
Risk Overview
continued
“AstraZeneca achieved Total Revenue
of $54.1 billion in 2024, including
$2.2 billion of Alliance Revenue and
$0.9 billion of Collaboration Revenue,
with growth of 18% (CER: 21%).”
2024 delivered excellent
revenue growth and business
performance, underpinned by
strong growth momentum and
encouraging pipeline progress.
Within Rare Disease,
Ultomiris
achieved
Product Sales of $3.9 billion, an increase
of 32% (CER: 34%), due to geographic
expansion, increased demand and
continued conversion from
Soliris
. In the US,
we had overall growth of 21%, with Product
Sales of $21.7 billion. In Emerging Markets,
Product Sales grew by 15% (CER: 23%)
to $13.5 billion, with notable growth in
Oncology and
Farxiga
. In Europe, Product
Sales increased by 20% (CER: 19%) to
$10.8 billion, reflecting strong performances
from Oncology and
Forxiga
and in
Established Rest of World markets, there
was a decline of 3% (CER: growth of 3%) to
$4.9 billion due to decreases in Oncology
offset by growth in CVRM.
Alliance Revenue increased by 55% (CER:
55%) to $2.2 billion, including $1.4 billion
from
Enhertu
, which has showed continued
growth since achieving blockbuster status
in 2023. Collaboration Revenue increased
by 56% (CER: 54%) to $0.9 billion.
Profitability
Reported EPS was $4.54 in the year (2023:
$3.84) and Core EPS was $8.21 (2023:
$7.26) driven by improved Product Sales
Gross Margin from Total Revenue growth
offset by a decline in Other operating
income and expense following gains in
2023 on updated contractual relationships
with Sobi and Sanofi and the disposal of US
rights to
Pulmicort Flexhaler
. Reported EPS
also includes impairment charges of
$753 million related to the vemircopan
(ALXN2050) intangible asset and $504
million recorded against the
Andexxa
intangible asset.
Key milestones/approvals
Our continued investment in the pipeline
yielded several significant approvals and
milestones in the year, including
Voydeya
,
Kavigale
and
Datroway
.
Voydeya
has been
approved in Japan and in the US as an
2024 was another remarkable year.
Performance across the business continued
to be strong and we had the opportunity to
increase our guidance twice during the
year. In May 2024, we hosted our first
Investor Day in 10 years setting forth our
ambition for 2030.
In order to achieve our ambition, we will
need to continue to invest not only in R&D
but also transform the organisation from a
technology and ways of working standpoint.
We have started our journey to get onto a
single Enterprise Resource Planning (ERP)
platform and are looking into ways of
incorporating the advances in AI into our
processes across the Group.
Total Revenue growth
AstraZeneca achieved Total Revenue of
$54.1 billion in 2024, including $2.2 billion
of Alliance Revenue and $0.9 billion of
Collaboration Revenue, with growth of
18% (CER: 21%). In 2024, we delivered
16 blockbuster medicines in total, including
Tezspire
,
Enhertu
and
Beyfortus
which are
medicines included in collaborations with
alliance partners.
Product Sales grew by 16% (CER: 19%) to
$50.9 billion, with 13 blockbuster medicines.
Our continued investment in Oncology and
increased demand for CVRM medicines,
supported sustained Product Sales growth,
with Oncology achieving 18% (CER: 21%)
and CVRM achieving 18% (CER: 20%).
Standout performances came once again
from
Farxiga
($7.7 billion),
Tagrisso
($6.6 billion) and
Imfinzi
($4.7 billion).
add-on therapy to
Ultomiris
or
Soliris
.
Kavigale
was accepted, under an
accelerated assessment procedure by
the EMA, for the prevention of COVID-19 in
immunocompromised patients.
Datroway
,
an ADC discovered by Daiichi Sankyo being
jointly developed by AstraZeneca and Daiichi
Sankyo, has been approved in Japan for the
treatment of adult patients with HR-positive,
HER2-negative unresectable or recurrent
breast cancer after prior chemotherapy.
I am really proud of the achievements
across the Group that allowed us to
achieve the results that we did in 2024;
2025 looks set to be another catalyst-rich
year that will unlock a number of derisking
events towards our 2030 ambition of new
medicines. We will continue to maintain
strong discipline to invest in the highest
value opportunities while building
a technology-enabled organisation.
It is my privilege to be part of this
incredible organisation.
Aradhana Sarin
Chief Financial Officer
67
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Financial Review
Financial Review
P
r
o
d
u
c
t
S
a
l
e
s
C
o
l
l
a
b
o
r
a
t
i
o
n
R
e
v
e
n
u
e
O
p
e
r
a
t
i
n
g
p
r
o
f
i
t
E
P
S
A
l
l
i
a
n
c
e
R
e
v
e
n
u
e
Summary performance in 2024
Reported
CER
Core
2024
$m
2023
$m
% Actual
change
CER
growth
1
$m
Growth
due to
exchange
effects
$m
% CER
change
2024
$m
2023
$m
% Actual
change
Product Sales
50,938
43,789
16
8,308
(1,159)
19
50,938
43,789
16
Alliance Revenue
2,212
1,428
55
792
(8)
55
2,212
1,428
55
Collaboration Revenue
923
594
56
323
6
54
923
594
56
Total Revenue
54,073
45,811
18
9,423
(1,161)
21
54,073
45,811
18
Cost of sales
(10,207)
(8,268)
23
(1,993)
54
25
(9,601)
(8,011)
20
Gross profit
43,866
37,543
17
7,430
(1,107)
20
44,472
37,800
18
Operating expenses
(34,115)
(30,690)
11
(3,684)
259
12
(27,794)
(24,545)
13
Other operating income and expense
252
1,340
(81)
(1,088)
1
(81)
250
1,279
(81)
Operating profit
10,003
8,193
22
2,658
(848)
32
16,928
14,534
16
Net finance expense
(1,284)
(1,282)
–
42
(44)
(3)
(1,169)
(984)
19
Share of after tax losses of joint ventures
and associates
(28)
(12)
>2x
(16)
–
>2x
(28)
(12)
>2x
Profit before tax
8,691
6,899
26
2,683
(891)
38
15,731
13,538
16
Taxation
(1,650)
(938)
76
(894)
184
92
(3,001)
(2,291)
31
Profit after tax
7,041
5,961
18
1,789
(709)
29
12,730
11,247
13
Basic earnings per share ($)
4.54
3.84
18
1.15
(0.46)
29
8.21
7.26
13
1
As detailed on page 70, CER growth is calculated using prior year actual results adjusted for certain exchange rate effects, including hedging.
Highlights
Financial performance
Total Revenue: Therapy Areas
Total Revenue: geographical areas
Emerging Markets
14%
growth
(CER: 22%)
CVRM
18%
growth
(CER: 20%)
US
22%
growth
Oncology
21%
growth
(CER: 24%)
Europe
27%
growth
(CER: 26%)
Rare
Disease
13%
growth
(CER: 16%)
Established RoW
-2%
decrease
(CER: 3% growth)
Respiratory &
Immunology
23%
growth
(CER: 25%)
Vaccines &
Immune Therapies
8%
growth
(CER: 8%)
Other
Medicines
-9%
decrease
(CER: -5%)
$50.9bn
16% growth
(CER: 19%)
$2.2bn
55% growth
(CER: 55%)
$10.0bn
22% growth
(CER: 32%)
$0.9bn
56% growth
(CER: 54%)
$16.9bn
16% growth
(CER: 22%)
$4.54
18% growth
(CER: 29%)
$8.21
13% growth
(CER: 19%)
Product
Sales
Alliance
Revenue
Operating
profit – Reported
Operating
profit – Core
Collaboration
Revenue
EPS –
Reported
EPS –
Core
68
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
Financial Review
continued
Business background
and results overview
The business background is covered in
the Healthcare in a Changing World section
from page 7, the Therapy Area Review from
page 16, and the Our Strategy and Key
Performance Indicators section from page
12, which describe in detail the business
developments of our products.
As described earlier in this Annual Report,
sales of our products are directly influenced
by medical need and are generally paid for
by health insurance schemes or national
healthcare budgets. Our operating results
can be affected by a number of factors
other than the delivery of operating plans
and normal competition.
Over the longer term, the success of our
R&D is crucial and we devote substantial
resources to this area. The benefits of this
investment are expected to emerge over
the long term and there is considerable
inherent uncertainty as to the scale and
timing of outcomes and their transition
to saleable products.
Measuring performance
Reported and Core performance are
referred to in this Financial Review when
reporting on our performance in absolute
terms, but more often in comparison with
earlier years:
•
Reported performance
takes into account
all the factors (including those which we
cannot influence, such as currency
exchange rates) that have affected the
results of our business. The Consolidated
Financial Statements have been prepared
in accordance with UK-adopted IAS and
with the requirements of the Companies
Act 2006 as applicable to companies
reporting under those standards. The
Consolidated Financial Statements also
comply fully with IFRS Accounting
Standards as issued by the IASB and IAS
as adopted by the EU.
•
Core performance
measures are adjusted
to exclude certain significant items, using
a set of established principles.
Use of non-GAAP performance measures
CER, Core performance measures, Product
Sales Gross Margin, Operating Margin,
EBITDA and Net debt are non-GAAP
performance measures because they
cannot be derived directly from the
Financial Statements.
By disclosing non-GAAP performance
and growth measures, in addition to our
Reported financial information, we are
enhancing investors’ ability to evaluate
and analyse the financial performance
and trends of our ongoing business and
the related key business drivers. The
adjustments are made to our Reported
financial information in order to show
non-GAAP performance measures that
illustrate clearly the impact on our
performance of factors such as changes in
revenues and expenses driven by volume,
prices and cost levels relative to such prior
years or periods. These non-GAAP
performance measures are not a substitute
for, or superior to, financial measures
prepared in accordance with GAAP.
As shown in the 2024 Reconciliation of
Reported results to Core results table on
page 72, our reconciliation of Reported
financial information to Core performance
measures includes a breakdown of the
items for which our Reported financial
information is adjusted, and a further
breakdown by specific line item, as such
items are reflected in our Reported income
statement. This illustrates the significant
items that are excluded from Core
performance measures and their impact on
our Reported financial information, both as
a whole and in respect of specific line items.
Management presents these results
externally to meet investors’ requirements
for transparency and clarity. Core financial
measures are also used internally in the
management of our business performance,
in our budgeting process and when
determining compensation. As a result,
Core performance measures allow
investors to differentiate between different
kinds of costs, but they should not be used
in isolation.
Our determination of non-GAAP
measures, and our presentation of them
within this Financial Review, may differ from
similarly titled non-GAAP measures of
other companies.
The SET retains strategic management of
the costs excluded from Reported financial
information in arriving at Core financial
measures, tracking their impact on Reported
Operating profit and EPS, with operational
management being delegated on a
case-by-case basis to ensure clear
accountability and consistency for each
cost category.
We strongly encourage readers of this
Annual Report not to rely on any single
financial measure but to review our
Financial Statements, including the Notes
thereto, and our other publicly filed reports,
carefully and in their entirety.
Further details of the risks
faced by the business are given
in Risk Overview from page 64
and in the Risk Supplement at
www.astrazeneca.com/
annualreport2024.
For a detailed definition of
Core measures, see page 70.
Also refer to the Summary
performance in 2024 table on
page 68, the 2024
Reconciliation of Reported
results to Core results and the
Excluded from Core results
tables on page 72, for our
discussion of comparative
growth measures.
69
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Financial Review
Non-GAAP measures: definitions
Revenue
Constant exchange rate
(CER) growth rates
Reconciliation,
see page 72
Definition:
Retranslation of the current year’s performance at
the previous year’s average exchange rates, adjusted for other
exchange effects, including hedging.
Why we use them:
CER measures allow us to focus on the
changes in revenues and expenses driven by volume, prices
and cost levels relative to the prior period. Revenues and cost
growth expressed in CER allow management to understand
the true local movement in revenues and costs, in order to
compare recent trends and relative return on investment. CER
growth rates can be used to analyse revenues in a number of
ways but, most often, we consider CER growth by products
and groups of products, and by countries and regions.
CER revenue growth can be further analysed by revenue
volumes and selling price. Similarly, CER cost growth helps
us to focus on the real local change in costs so that we can
manage the cost base effectively.
Limitations:
CER measures are not always better indicators of
performance. Where countries are subject to high inflation and
currencies that depreciate persistently, adjusting out the effect
of foreign exchange fluctuations could give an overly optimistic
view of growth.
Profitability
Core performance
measures
Reconciliation,
see page 72
Core performance measures
are adjusted to exclude certain
significant items. In determining the adjustments to arrive at
the Core result, we use a set of established principles relating
to the nature or materiality of individual items or groups of
items, excluding, for example, events which are (i) outside
the normal course of business, (ii) incurred in a pattern that is
unrelated to the trends in the underlying financial performance
of our ongoing business, or (iii) related to major acquisitions,
to ensure that investors’ ability to evaluate and analyse the
underlying financial performance of our ongoing business
is enhanced.
Our Core adjustments are summarised as:
Restructuring costs,
including charges and provisions related
to our global restructuring programmes on our capitalised
manufacturing facilities and IT assets. These can take place
over multiple reporting periods, given the long life-cycle of
our business.
Why we use them:
We adjust for these charges and provisions
because they primarily reflect the financial impact of change
to legacy arrangements, rather than the underlying
performance of our ongoing business.
Intangible amortisation and impairments,
including
impairment reversals but excluding any charges relating to
IT assets. Intangibles generally arise from business
combinations and individual licence acquisitions.
Why we use them:
We adjust for these charges because
their pattern of recognition is largely uncorrelated with the
underlying performance of the business.
Prior year Alexion acquisition-related items,
primarily fair
value adjustments on acquired inventories and fair value
impact of replacement employee share awards.
Why we use them:
We adjust for this item to enable a more
meaningful comparison of the performance of acquired
businesses and products to that of internally developed
products, as well as removing charges whose pattern of
recognition is largely uncorrelated to the underlying
performance of the business.
Other specified items,
principally comprise acquisition-related
costs and credits, which include the imputed finance charges
and fair value movements relating to contingent consideration
on business combinations, imputed finance charges and
remeasurement adjustments on certain Other payables arising
from intangible asset acquisitions, remeasurement adjustments
relating to Other payables and debt items assumed from the
Alexion acquisition and legal settlements.
Why we use them:
We adjust for these items to enable a
more meaningful comparison of the performance of acquired
businesses and products to that of internally developed
products, as well as removing charges whose pattern of
recognition is largely uncorrelated to the underlying
performance of the business.
It should be noted that some costs excluded from our Core
results, such as intangible amortisation and finance charges
related to contingent consideration, will recur in future years,
and other excluded items such as impairments and legal
settlement costs, along with other acquisition-related costs,
may recur in the future.
Limitations:
Core results exclude significant costs (such as
restructuring, intangible amortisation and impairments, and
other acquisition-related adjustments), but incorporate
associated benefits, including Product Sales arising from
business combinations, asset acquisitions and assets which
have been amortised, as well as the benefits resulting from
restructuring activities and, as such, they should not be
regarded as a complete picture of the Group’s financial
performance, which is presented in its Reported results. The
exclusion of the adjusting items may result in Core earnings
being materially higher or lower than Reported earnings.
Product Sales Gross
Margin
Reconciliation,
see page 72
Definition:
Product Sales Gross Margin is the percentage by
which Product Sales exceeds the Cost of sales, calculated by
dividing the difference between the two by the sales figure.
The calculation of Reported and Core Product Sales Gross
Margin excludes the impact of Alliance Revenue and
Collaboration Revenue and any associated costs, thereby
reflecting the underlying performance of Product Sales.
Why we use it:
This measure sets out gross profitability of
Product Sales when taking account of only direct Cost of sales.
It is a key performance measure of the contribution to fund
operating costs and overall quality of the business.
Limitations:
Product Sales Gross Margin percentage excludes
the impact of Alliance Revenue and Collaboration Revenue and
related costs and therefore should not be regarded as giving a
full picture of Total Revenue performance.
70
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
Financial Review
continued
Operating Margin
Reconciliation,
see page 72
Definition:
Operating profit as a percentage of Total Revenue.
Why we use it:
This measure sets out profitability derived
from operating activities before the impact of finance costs
and tax. It is a key performance measure of the overall
quality of the operations of the business.
Limitations:
Operating Margin excludes the impact of financing
costs and therefore should not be regarded as a full picture of
revenue performance.
EBITDA
Reconciliation,
see page 76
Definition:
Reported Profit before tax plus Net finance
expense, Share of after tax losses of joint ventures and
associates, and charges for Depreciation, amortisation
and impairment.
Why we use it:
EBITDA allows us to understand our baseline
profitability, removing any ‘non-operational’ expenses and
non-cash items that are not considered by management to be
reflective of the underlying performance of the Group.
Limitations:
EBITDA does not take account of the cost of
investment to generate revenues, hence is not always the best
indicator of performance.
Cash flow and liquidity
Net debt
Reconciliation,
see page 78
Definition:
Interest-bearing loans and borrowings and
Lease liabilities, net of Cash and cash equivalents, Other
investments and Net derivative financial instruments.
Why we use it:
Net debt is a measure that provides valuable
additional information regarding the Group’s net financial
liabilities and is a measure commonly used by investors and
rating agencies. It facilitates the tracking of one of our key
financial priorities: deleveraging.
Non-GAAP measures: definitions
continued
71
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Financial Review
Excluded from Core results
Restructuring costs
•
Restructuring costs totalling $1,154 million (2023: $467 million) mainly comprise those incurred on the PAAGR of $1,115 million
(2023: $362 million), including $480 million for inventory and related product provisions following the decision to cease
promotional activities for
Andexxa
.
Intangible amortisation
and impairments
•
Amortisation totalling $3,839 million (2023: $3,846 million) relating to intangible assets, except those related to IT. Further
information on our intangible assets is contained in Note 10 to the Financial Statements from page 172. Intangible impairment
charges were $1,569 million (2023: $434 million), excluding those related to IT and other intangibles. This includes $753
million related to the impairment of the vemircopan (ALXN2050) intangible asset, following the decision to discontinue this
development programme, $504 million related to the
Andexxa
intangible asset, which was fully impaired following the
decision to cease promotional activity for
Andexxa
, and $165 million relating to product in development FPI-2059 due to
decisions made to terminate the related activities and prioritise resources on the development of FPI-2265 and AZD2068.
Further details relating to intangible asset impairments are included in Note 10 to the Financial Statements from page 172.
Other
•
Other adjustments, excluding taxation adjustments, amounted to $478 million (2023: $1,755 million).
•
Other adjustments to Reported SG&A expense were $351 million (2023: $1,458 million), primarily relating to net fair value
adjustments to contingent consideration balances of $311 million (2023: $549 million). Other adjustments to Reported SG&A
expenses in 2023 included a charge to legal provisions of $425 million in relation to
Nexium
and
Losec
/
Prilosec
product
liability litigation, $510 million in relation to Bristol-Myers Squibb Co. and E.R. Squibb & Sons, LLC and $70 million in relation
to Alexion shareholder litigation. Further details relating to contingent consideration balances are contained in Note 20 to the
Financial Statements from page 181. Further details of legal proceedings, ongoing at 31 December 2024, are contained within
Note 30 to the Financial Statements from page 203.
•
Other adjustments to Reported Net finance expense of $115 million (2023: $298 million) include discount unwind charges on
liabilities arising from business combinations and on liabilities resulting from the
Enhertu
collaboration agreement.
•
Other adjustments to Reported Taxation amounted to $88 million (2023: $405 million).
2024 Reconciliation of Reported results to Core results
2024
Reported
$m
Restructuring
costs
$m
Intangible
amortisation
and
impairments
$m
Other
1
$m
2024
Core
2
$m
Core 2024 compared with
Core 2023
2
Actual
growth
%
CER
growth
%
Gross profit
43,866
569
32
5
44,472
18
20
Product Sales Gross Margin %
80
81
Distribution expense
(555)
–
–
–
(555)
3
5
Research and development expense
(13,583)
275
1,090
7
(12,211)
19
19
Selling, general and administrative expense
(19,977)
312
4,286
351
(15,028)
9
11
Other operating income and expense
252
(2)
–
–
250
(81)
(81)
Operating profit
10,003
1,154
5,408
363
16,928
16
22
Operating Margin %
18
31
Net finance expense
(1,284)
–
–
115
(1,169)
19
15
Taxation
(1,650)
(219)
(1,044)
(88)
(3,001)
31
38
Basic earnings per share ($)
4.54
0.60
2.82
0.25
8.21
13
19
2023 Reconciliation of Reported results to Core results
2023
Reported
$m
Restructuring
costs
$m
Intangible
amortisation
and
impairments
$m
Acquisition
of Alexion
$m
Other
1
$m
2023
Core
2
$m
Core 2023 compared with
Core 2022
2
Actual
growth
%
CER
growth
%
Gross profit
37,543
109
32
119
(3)
37,800
6
9
Product Sales Gross Margin %
81
82
Distribution expense
(539)
–
–
–
–
(539)
1
2
Research and development expense
(10,935)
212
447
7
2
(10,267)
8
9
Selling, general and administrative expense
(19,216)
207
3,801
11
1,458
(13,739)
7
9
Other operating income and expense
1,340
(61)
–
–
–
1,279
>2x
>2x
Operating profit
8,193
467
4,280
137
1,457
14,534
9
14
Operating Margin %
18
32
Net finance expense
(1,282)
–
–
–
298
(984)
1
(1)
Taxation
(938)
(107)
(809)
(32)
(405)
(2,291)
11
17
Basic earnings per share ($)
3.84
0.23
2.24
0.07
0.88
7.26
9
15
1
See Excluded from Core results table below for further details of other adjustments.
2
Each of the measures in the Core columns is a non-GAAP measure.
72
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
Financial Review
continued
Product Sales
By geography
US Product Sales were up 21% to
$21,655 million, reflecting the continued
growth of our Oncology medicines,
Ultomiris
, which increased by 29% due to a
rise in patient demand in gMG and NMOSD,
and
Symbicort
which was up 63% due to
continued demand. Product Sales in
Emerging Markets increased by 15% (CER:
23%) to $13,535 million in 2024 with growth
in Oncology and CVRM, driven by
Forxiga
which was up by 29% (CER: 35%) with
increased reimbursement supporting solid
growth. Product Sales in ex-China Emerging
Markets grew by 21% (CER: 36%) at
$7,133 million, with continued increases in
Oncology and
Farxiga
. In Europe, Product
Sales grew by 20% (CER: 19%) to
$10,848 million, reflecting a strong
performance in Oncology and
Forxiga
.
Established Rest of World Product Sales
decreased by 3% (CER: growth of 3%) to
$4,900 million, with sales in Japan down
5% (CER: growth of 3%) to $3,489 million,
driven by slight decreases in Oncology
partially offset by increases in CVRM.
By product
In 2024, we succeeded in delivering
13 blockbuster drugs.
Our largest selling products in the year
were
Farxiga
($7,656 million),
Tagrisso
($6,580 million),
Imfinzi
($4,717 million),
Ultomiris
($3,924 million) and
Calquence
($3,129 million).
Farxiga
sales increased by
28% (CER: 31%), growing faster than the
overall SGLT2 market in all major regions,
driven by continued demand in heart failure
and CKD.
Tagrisso
sales grew by 13%
(CER: 16%) reflecting a strong global
demand in adjuvant and 1st-line settings.
Imfinzi
Product Sales grew by 17% (CER:
21%) due to growing demand.
Ultomiris
increased by 32% (CER: 34%) due to higher
use in neurology, geographic expansion,
increasing patient demand and further
conversion from
Soliris
.
Calquence
continued its growth with an increase of
24% (CER: 25%) in the year, driven by
sustained leadership in front-line CLL.
Total Revenue
Total Revenue for 2024 was up 18%
(CER: 21%) to $54,073 million, comprising
Product Sales of $50,938 million, up 16%
(CER: 19%), Alliance Revenue of
$2,212 million, an increase of 55%
(CER: 55%), and Collaboration Revenue of
$923 million, an increase of 56% (CER: 54%).
Product Sales
2024
Product
Sales
$m
2023
Product
Sales
$m
Actual
growth
%
CER
growth
%
Product Sales by Therapy Area
Oncology
20,275
17,145
18
21
CVRM
12,448
10,585
18
20
Respiratory & Immunology
7,416
6,107
21
23
Vaccines & Immune Therapies
1,058
1,012
5
6
Rare Disease
8,668
7,764
12
14
Other Medicines
1,073
1,176
(9)
(4)
Total
50,938
43,789
16
19
2024
Product
Sales
$m
2023
Product
Sales
$m
Actual
growth
%
CER
growth
%
Product Sales by geographical area
US
21,655
17,961
21
21
Emerging Markets
13,535
11,751
15
23
Europe
10,848
9,029
20
19
Established RoW
4,900
5,048
(3)
3
Total
50,938
43,789
16
19
73
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Financial Review
Alliance Revenue
2024
$m
2023
$m
Alliance Revenue
Enhertu
1,437
1,022
Tezspire
436
259
Beyfortus
237
57
Other royalty income
91
81
Other Alliance Revenue
11
9
Total Alliance Revenue
2,212
1,428
Collaboration Revenue
2024
$m
2023
$m
Collaboration Revenue
Lynparza:
sales milestone
600
–
Beyfortus:
sales milestones
167
27
Koselugo:
sales milestone
100
–
Farxiga:
sales milestones
56
29
Lynparza:
regulatory milestone
–
245
COVID-19 mAbs: licence fees
–
180
Beyfortus:
regulatory milestones
–
71
tralokinumab: milestones
–
20
Other Collaboration Revenue
–
22
Total Collaboration Revenue
923
594
Tezspire
(Amgen)
In 2012, AstraZeneca entered into a
collaboration agreement with Amgen to
co-develop and co-commercialise five
development stage programmes. Of these,
only
Tezspire
remains in the collaboration.
A second active molecule (AZD8630)
was added in 2021. Manufacturing will
be undertaken by Amgen, while
commercialisation activity will be
undertaken either jointly, or by AstraZeneca
or Amgen individually, dependent on the
market and on the agreed terms.
AstraZeneca recognises 100% of the sales
as principal in all markets other than the US,
as well as 100% of the associated cost of
sales. In markets other than the US,
where AstraZeneca is recognising sales,
the share of gross margin payable to Amgen
is shown as additional cost of sales. In the
US, where Amgen is recognising sales,
AstraZeneca records its share of gross
profit as Alliance Revenue.
•
Prior to 2024, we recognised $338 million
in respect of Alliance Revenue.
•
In 2024, we recognised Alliance Revenue
of $436 million.
Beyfortus
(Sanofi)
In March 2017, AstraZeneca entered into
an alliance with Sanofi to develop and
commercialise
Beyfortus
jointly. Under the
terms of the global agreement, Sanofi
made an upfront payment of €120 million
and agreed to pay up to €495 million upon
achievement of certain development and
sales-related milestones. All costs and
profits are shared equally. The US element
of this collaboration was subject to a
participation agreement with Sobi, effective
from January 2019 until April 2023, at which
point there was an update to the contractual
relationships between AstraZeneca, Sobi
and Sanofi relating to the future sales of
Beyfortus
. Alliance Revenue includes
AstraZeneca’s 50% share of gross profits
on sales of
Beyfortus
in major markets
outside the US.
•
Prior to 2024, we recognised $57 million
in respect of Alliance Revenue.
•
In 2024, we recognised Alliance Revenue
of $237 million.
Collaboration Revenue
Collaboration Revenue, consisting of
upfront payments and event-triggered
milestones, increased in the year by 56%
(CER: 54%) to $923 million.
Details of our significant business
development transactions which give rise
to Collaboration Revenue are given below.
Lynparza/Koselugo
(MSD)
In July 2017, the Group announced a global
strategic oncology collaboration with MSD
to co-develop and co-commercialise
AstraZeneca’s
Lynparza
for multiple cancer
types and
Koselugo
for neurofibromatosis
type 1. As part of the agreement, MSD
agreed to pay AstraZeneca up to $8.5 billion
in total consideration, including $1.6 billion
upfront, $750 million for certain licence
options and up to $6.2 billion contingent
upon successful achievement of future
regulatory and sales-related milestones.
Of the $1.6 billion upfront payment, $1.0
billion was recognised as Collaboration
Revenue on deal completion in 2017, with
the remaining $0.6 billion deferred to the
balance sheet, virtually all of which has
been released to the Consolidated
Statement of Comprehensive Income as at
31 December 2024. AstraZeneca records all
product sales for
Lynparza
and
Koselugo
,
with the share of gross profits due to MSD
under the collaboration being recorded
under Cost of sales. Additionally,
AstraZeneca recognises Collaboration
Revenue relating to regulatory milestones
and sales-related milestones.
Alliance Revenue
Alliance Revenue, comprising our share
of gross profits, share of revenues and
royalties, increased in the year by 55%
(CER: 55%), to $2,212 million, including
$1,437 million from
Enhertu
and
$436 million from
Tezspire
, which
achieved blockbuster status in 2024.
Details of our significant business
development transactions which give rise
to Alliance Revenue are given below.
Enhertu
(Daiichi Sankyo)
In March 2019, AstraZeneca entered into an
alliance with Daiichi Sankyo to develop and
commercialise
Enhertu
for multiple cancer
types. In markets where Daiichi Sankyo is
selling the product, AstraZeneca is entitled
to receive a royalty (in Japan) or a share of
costs and income (in other territories). Share
of gross profits and royalty income from
Daiichi Sankyo are recognised as Alliance
Revenue.
Enhertu
launched in the US on
31 December 2019.
•
Prior to 2024, we recognised
$1,828 million in respect of Alliance
Revenue.
•
In 2024, we recognised Alliance Revenue
of $1,437 million.
74
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
Financial Review
continued
Operating expenses
Reported Operating expenses increased by
11% (CER: 12%) in the year to $34,115 million.
Core Operating expenses decreased by
13% (CER: 14%) to $27,794 million.
Reported R&D expense increased by 24%
(CER: 25%) to $13,583 million and Core R&D
expense increased by 19% (CER: 19%) to
$12,211 million. Both Reported and Core R&D
expense were impacted by recent positive
data readouts for several high-priority
medicines, increased investment in new
platforms, technologies and capabilities
and additional R&D projects following
completion of previously announced
business development activity including
Icosavax, Gracell, Fusion and Amolyt
Pharma. The Reported R&D expense was
also impacted by intangible asset
impairments of $1,065 million (2023:
$417 million) which includes $753 million
related to the impairment of the vemircopan
(ALXN2050) intangible asset, following the
decision to discontinue this development
programme, and $165 million relating to
product in development, FPI-2059, due to
decisions made to terminate the related
activities and prioritise resources on the
development of FPI-2265 and AZD2068.
Reported SG&A expense increased by 4%
(CER: 5%) to $19,977 million and Core SG&A
expense increased by 9% (CER: 11%) to
$15,028 million. Both Reported and Core
SG&A expense increases were driven
primarily by market development activities
for launches and to support continued
growth in existing brands. Reported SG&A
expense also includes an impairment
charge of $504 million recorded against the
Andexxa
intangible asset following the
decision to cease promotional activity for
this product. The prior year Reported SG&A
expense was impacted by a $510 million
charge to provisions relating to a legal
settlement with Bristol-Myers Squibb and
Ono Pharmaceutical, and a $425 million
charge to provisions for product liability
litigations related to
Nexium
and
Prilosec
.
Other operating income and expense
Reported Other operating income and
expense in the year was down 81% (CER:
81%) to $252 million. Core Other operating
income and expense in the year was down
81% (CER: 81%) to $250 million.
In 2023, both Reported and Core Other
operating income and expense included
a gain of $712 million on replacement of
the contractual relationship between
AstraZeneca, Sobi and Sanofi with a royalty
relationship between Sanofi and Sobi and
income of $241 million on the disposal of
the US rights to
Pulmicort Flexhaler
.
Operating profit
Reported Operating profit increased by
22% (CER: 32%) to $10,003 million in the
year. Reported Operating Margin remained
flat at 18% of Total Revenue (CER: increased
by two percentage points). Core Operating
profit grew by 16% (CER: 22%) in the year
to $16,928 million.
Net finance expense
Reported Net finance expense remained flat
(CER: decreased by 3%) in the year totalling
$1,284 million. Core Net finance expense
increased by 19% (CER: 15%) in the year to
$1,169 million. Reported Net finance expense
was impacted by the discount unwind on
acquisition-related liabilities. Core Net
finance expense increased due to the
increased level of debt and new debt
issued at higher interest rates.
•
Prior to 2024, we have recognised
Collaboration Revenue totalling
$3,110 million, comprising $750 million
resulting from the exercise of options,
$1,400 million in respect of sales-related
milestones and $960 million in respect
of regulatory milestones.
•
In 2024, we recognised Collaboration
Revenue of $600 million in respect of a
Lynparza
sales-related milestone and
$100 million in respect of a
Koselugo
sales-related milestone.
Beyfortus
(Sanofi)
Details of this business development
transaction are summarised in the Alliance
Revenue section on page 74.
•
Prior to 2024, we recognised Collaboration
Revenue totalling $284 million, comprising
$127 million (€120 million) of upfront
consideration, $130 million (€120 million)
in respect of regulatory milestones,
and $27 million (€25 million) in respect
of sales-related milestones.
•
In 2024, we recognised Collaboration
Revenue of $167 million (€150 million)
in respect of sales-related milestones.
Gross profit
Reported Gross profit increased by 17%
(CER: 20%) to $43,866 million. Core Gross
profit increased by 18% (CER: 20%) to
$44,472 million. Reported Product Sales
Gross Margin decreased by one (CER: one)
percentage point to 80%. Core Product
Sales Gross Margin decreased by one
percentage point (CER: remained flat) to
81%. Both Reported and Core Product Sales
Gross Margin reflected positive product mix
effects from Rare Disease and Oncology
medicines, negative product mix effects
from rising contributions of products with
share of gross profit arrangements, and
negative geographic mix effects as
Emerging Markets grew as a proportion
of Total Revenue.
75
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Financial Review
Total comprehensive income
Total comprehensive income decreased
by $453 million to $6,241 million in 2024.
Other comprehensive expense, net of tax,
was $800 million, a decrease of $1,533
million. This expense was primarily driven
by foreign exchange losses arising on
consolidation of $957 million (2023: gains
of $608 million).
EPS
Reported EPS was $4.54 in the year (2023:
$3.84). Core EPS was $8.21 (2023: $7.26).
Restructuring
Post Alexion Acquisition Group Review
(PAAGR)
In conjunction with the acquisition of
Alexion in 2021, the enlarged Group
initiated a comprehensive review, aimed
at integrating systems, structure and
processes, optimising the global footprint
and prioritising resource allocations and
investments. Except as referenced below,
these activities are expected to be
substantially complete by the end of 2026.
During 2023, the Group identified all
remaining activities and finalised the scope
of the programme. During 2024, the Group
undertook a further assessment of those
planned activities. Updated estimates of
the planned activities have resulted in an
increase to the expected one-time
restructuring costs of $0.8 billion, of
which $0.3 billion are non-cash costs,
and an increase in capital investments
of $0.6 billion.
This includes the commencement of work
on the planned upgrade of the Group’s ERP
IT systems (Axial Project), which is expected
to be substantially complete by the end of
2030, resulting in capital investments for
software assets of $1.3 billion and one-time
restructuring cash costs of $0.5 billion, over
the full course of the project.
Consequently, the total programme
activities are now anticipated to incur
one-time restructuring costs of
approximately $4.4 billion, of which
approximately $3.0 billion are cash costs
and $1.4 billion are non-cash costs, and
capital investments of approximately
$2.2 billion.
Run-rate pre-tax benefits, before
reinvestment, are now expected to be
approximately $2.3 billion by the end of
2026. In line with established practice,
restructuring costs will be excluded from
our Core (non-GAAP) financial measures.
During 2024, the Group has recorded
restructuring charges of approximately
$1.1 billion in relation to the PAAGR (2023:
$0.4 billion), bringing the cumulative
charges to date under this programme to
$3.2 billion. Of these costs, $0.8 billion
are non-cash costs arising from
impairments and accelerated
depreciation on affected assets.
As at 31 December 2024, the PAAGR has
realised annual run-rate pre-tax benefits,
before reinvestment, of $1.5 billion.
Other programmes
Legacy programmes include the
centralisation of our global R&D footprint
and the transformation of SG&A functions
(principally Finance and HR). Net costs
for legacy programmes in 2024 were
$39 million (2023: $92 million).
The aggregate restructuring charge
incurred in 2024 across all our restructuring
programmes was $1,154 million (2023:
$467 million). Final estimates for programme
costs, benefits and headcount impact in all
functions are subject to completion of the
requisite consultation in the various areas.
Our priority, as we undertake these
restructuring initiatives, is to work with
our affected employees on the proposed
changes, acting in accordance with relevant
local consultation requirements and
employment law.
Profit before tax
Reported Profit before tax increased by
26% (CER: 38%) to $8,691 million in the
year. Core Profit before tax increased by
16% (CER: 22%) to $15,731 million. Pre-tax
adjustments to arrive at Core Profit before
tax amounted to $7,040 million in 2024
(2023: $6,639 million), comprising
$6,925 million adjustments to Reported
Operating profit (2023: $6,341 million)
and $115 million to Reported Net finance
expense (2023: $298 million).
EBITDA
EBITDA increased by 23% (CER: 29%)
to $16,691 million in the year (2023:
$13,580 million).
Taxation
The Reported and Core tax rates for the
year were both 19%.
The income tax paid for the year was
$2,750 million (2023: $2,366 million).
This was $1,100 million higher than the
Reported tax charge for the year, which
benefited from a net deferred tax credit of
$795 million (2023: $1,507 million), relating
to intangible amortisation and impairments,
and other deferred tax items and payment
of prior period tax liabilities, and the timing
differences for cash payments. Additional
information on these items is contained in
Note 4 to the Financial Statements from
page 163.
We pay corporate income taxes,
customs duties, excise taxes, stamp duties,
employment, environmental and many
other business taxes in all jurisdictions
in which we operate. We also collect and
pay employee taxes and other indirect
taxes such as value-added tax in
these jurisdictions.
Reconciliation of Reported Profit before tax to EBITDA
2024
$m
2023
$m
Actual
growth
%
CER
growth
%
Reported Profit before tax
8,691
6,899
26
38
Net finance expense
1,284
1,282
–
(3)
Share of after tax losses of joint ventures
and associates
28
12
>2x
>2x
Depreciation, amortisation and impairment
6,688
5,387
24
24
EBITDA
16,691
13,580
23
29
For more information regarding the
AstraZeneca tax policy, see our
website, www.astrazeneca.com.
76
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
Financial Review
continued
Cash flow and liquidity – for the year
ended 31 December 2024
Net cash generated from operating
activities was $11,861 million (2023:
$10,345 million). This primarily
reflects an underlying improvement
in business performance.
Net investment cash outflows were
$8,353 million (2023: $4,638 million).
Investment cash outflows for 2024 include:
•
Payments of contingent consideration
from business combinations of $1,008
million (2023: $826 million).
•
$2,662 million (2023: $2,417 million)
for the purchase of intangible assets,
including $800 million for the Amolyt
Pharma asset acquisition, $639 million
for the Icosavax asset acquisition,
and $200 million of sales-related
milestones paid to Daiichi Sankyo in
respect of
Enhertu
.
•
$2,771 million (2023: $189 million) for the
acquisition of subsidiaries, net of cash
acquired, including $1,997 million for the
Fusion acquisition, and $774 million for
the Gracell acquisition.
Investment cash inflows include:
•
$123 million (2023: $291 million) from the
sale of intangible assets.
Net cash distributions to shareholders were
$4,591 million (2023: $4,448 million),
including proceeds from the issue of share
capital of $38 million (2023: $33 million)
less dividends paid of $4,629 million
(2023: $4,481 million).
Summary cash flows
2024
$m
2023
$m
2022
$m
Net debt brought forward at 1 January
(22,510)
(22,923)
(24,322)
Profit before tax
8,691
6,899
2,501
Sum of changes in interest, depreciation, amortisation,
impairment and share of after tax losses on joint ventures and
associates
8,000
6,681
6,736
Decrease in working capital and short-term provisions
(893)
300
3,757
Tax paid
(2,750)
(2,366)
(1,623)
Interest paid
(1,313)
(1,081)
(849)
Gains on disposal of intangible assets
(64)
(251)
(104)
Fair value movements on contingent consideration arising
from business combinations
311
549
82
Non-cash and other movements
(121)
(386)
(692)
Net cash available from operating activities
11,861
10,345
9,808
Purchase of intangibles, net of disposals
(2,539)
(2,126)
(1,033)
Acquisition of subsidiaries, net of cash acquired
(2,771)
(189)
(48)
Share-based payments attributable to business combinations
(3)
(84)
(215)
Payment of contingent consideration from business
combinations
(1,008)
(826)
(772)
Other capital expenditure (net)
(2,032)
(1,413)
(838)
Investments
(8,353)
(4,638)
(2,906)
Dividends
(4,629)
(4,481)
(4,364)
Proceeds from the issue of share capital
38
33
29
Distributions
(4,591)
(4,448)
(4,335)
Repayment of obligations under leases
(316)
(268)
(244)
Payment of Acerta Pharma share purchase liability
(833)
(867)
(920)
Other movements
172
289
(4)
Net debt carried forward at 31 December
(24,570)
(22,510)
(22,923)
77
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Financial Review
Bonds
In March 2024, AstraZeneca issued
$5,000 million of USD bonds and, in August
2024, AstraZeneca issued $1,517 million of
EUR bonds with a notional face value of
€1,400 million.
In March 2023, AstraZeneca issued
$3,832 million of bonds. USD bonds with
a notional face value of $2,250 million and
EUR bonds with a notional face value of
€1,500 million were issued.
In 2024, AstraZeneca repaid floating rate
bank loans of $2,000 million, which matured
in July 2024 and a $1,600 million USD bond,
which matured in May 2024. $1,026 million
was also repaid in respect of a EUR bond,
with a notional face value of €900 million,
which was held in a cash flow hedge and
matured in May 2024.
In 2023, AstraZeneca repaid $2,000 million
of floating rate bank loans in March 2023,
which were due to mature in July 2023, a
$1,400 million 0.3% callable bond, which
matured in May 2023, $400 million of
floating rate notes and an $850 million
3.5% callable bond, both of which matured
in August 2023, and $287 million of 7%
guaranteed debentures, which matured
in November 2023.
Net debt
Net debt at 31 December 2024 was
$24,570 million (2023: $22,510 million).
At 31 December 2024, gross debt (interest-
bearing loans and borrowings) was
$30,295 million (2023: $28,622 million).
Of the gross debt outstanding, $2,676
million is due within one year (2023:
$5,400 million).
At 31 December 2024, Cash and cash
equivalents and Other investments totalled
$5,654 million (2023: $5,962 million).
The Group maintains committed
bank facilities to manage liquidity.
At 31 December 2024, the Group held
$4,875 million of such facilities with a
maturity date of April 2029. In January 2025
the maturity of these facilities was extended
by one year to April 2030. These facilities
contain no covenants and were undrawn
at 31 December 2024. The Group regularly
monitors the credit standing of the banks
providing the facilities and currently does
not anticipate any issue with drawing on
the committed facilities should this be
necessary. Advances under these facilities
currently bear an interest rate per annum
based on SOFR (Secured Overnight
Financing Rate) plus a margin.
Repayment
dates
Face value
of bond
$m
Net book
value of
bond at
31 December
2024
$m
Bonds issued in 2024:
4.8% USD bond
2027
1,250
1,247
4.85% USD bond
2029
1,250
1,246
3.121% EUR bond
2030
704
682
4.9% USD bond
2031
1,000
994
3.278% EUR bond
2033
813
786
5.0% USD bond
2034
1,500
1,489
Total 2024
6,517
6,444
Bonds issued in 2023:
3.625% EUR bond
2027
791
780
4.875% USD bond
2028
1,100
1,096
4.9% USD bond
2030
650
646
3.75% EUR bond
2032
791
778
4.875% USD bond
2033
500
497
Total 2023
3,832
3,797
Net debt reconciliation
2024
$m
2023
$m
2022
$m
Cash and cash equivalents
5,488
5,840
6,166
Other investments
1
166
122
239
Cash and investments
5,654
5,962
6,405
Overdraft and short-term borrowings
(330)
(515)
(350)
Lease liabilities
(1,452)
(1,128)
(953)
Current instalments of loans and borrowings
(2,007)
(4,614)
(4,964)
Loans due after one year
(26,506)
(22,365)
(22,965)
Loans and borrowings
(30,295)
(28,622)
(29,232)
Net derivative financial instruments
71
150
(96)
Net debt
2
(24,570)
(22,510)
(22,923)
1
Other investments exclude non-current investments, which are included within the balance of $1,632 million (2023:
$1,530 million) in the Consolidated Statement of Financial Position on page 149.
2
The equivalent GAAP measure to Net debt is ‘liabilities arising from financing activities’, which excludes the amounts
for cash and overdrafts, other investments and non-financing derivatives shown above, and includes the Acerta
Pharma share purchase liability of $nil (2023: $833 million) presented in current Other payables.
Payments due by period
Less than
1 year
$m
1-3 years
$m
3-5 years
$m
Over
5 years
$m
Total
2024
$m
Total
2023
$m
Bank loans and other
borrowings
1
3,390
7,107
7,758
19,929
38,184
35,959
Lease liabilities
339
575
250
288
1,452
1,128
Contracted capital
expenditure
546
157
53
819
1,575
1,368
Total
4,275
7,839
8,061
21,036
41,211
38,455
1
Bank loans and other borrowings include interest charges payable in the period, as detailed in Note 28 to the Financial
Statements from page 194.
Bonds issued in 2024 and 2023
78
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
Financial Review
continued
Gracell
In February 2024, AstraZeneca
completed the acquisition of Gracell, a
global clinical-stage biopharmaceutical
company developing innovative cell
therapies for the treatment of cancer and
autoimmune diseases. The purchase price
allocation review has been completed.
The total consideration fair value of
$1,037 million includes cash consideration
of $983 million and future regulatory
milestone-based consideration of
$54 million. Intangible assets of
$1,038 million and goodwill of $136 million
were recognised in the acquisition balance
sheet, as well as a net deferred tax liability
of $260 million. AstraZeneca acquired the
cash and cash equivalents on Gracell’s
balance sheet, which totalled $209 million
at the close of the transaction. Gracell’s
results have been consolidated into the
Group’s results from 22 February 2024.
Neogene
In January 2023, AstraZeneca completed
the acquisition of Neogene, a global
clinical-stage biotechnology company
pioneering the discovery, development and
manufacturing of next-generation TCR
-T.
The purchase price allocation exercise
has completed, with the fair value of total
consideration determined at $267 million.
Intangible assets of $100 million and
goodwill of $158 million were recognised in
the acquisition balance sheet, as well as a
cash outflow of $189 million net of cash
acquired. Following achievement of agreed
milestones in 2024, contingent milestones-
based consideration and non-contingent
consideration of $120 million is payable.
Neogene’s results have been consolidated
into the Group’s results from
16 January 2023.
The acquisitions have been accounted
for as business combinations using
the acquisition method of accounting
in accordance with IFRS 3
‘Business Combinations’.
Acquisitions treated as asset acquisitions
Amolyt Pharma
In July 2024, AstraZeneca completed the
acquisition of Amolyt Pharma, a clinical-
stage biotechnology company focused
on developing novel treatments for rare
endocrine diseases. AstraZeneca acquired
all outstanding equity of Amolyt Pharma
with consideration of $857 million,
principally relating to $800 million of
intangible assets and $98 million of cash
and cash equivalents. Contingent
consideration of up to $250 million could
be paid on achievement of a regulatory
milestone; this potential liability would be
recorded when the relevant recognition
event for a regulatory milestone is achieved.
Icosavax
In February 2024, AstraZeneca completed
the acquisition of Icosavax, a US-based
clinical-stage biopharmaceutical company
focused on developing differentiated,
high-potential vaccines using an innovative,
protein virus-like particle platform.
Consideration totalled $841 million, principally
relating to $639 million of intangible assets,
$141 million of cash and cash equivalents
and $51 million of marketable securities.
Contingent consideration of up to $300 million
could be paid on achievement of regulatory
and sales milestones; these potential
liabilities would be recorded when the
relevant recognition event for a regulatory
or sales milestone is achieved.
CinCor
In February 2023, AstraZeneca completed
the acquisition of 100% of the issued shares
of CinCor, for consideration of $1,268 million,
which included intangible assets acquired of
$780 million, $424 million of cash and cash
equivalents, and $75 million of marketable
securities. Contingent consideration of up to
$496 million could be paid on achievement
of regulatory milestones and those liabilities
will be recorded when milestones are
triggered, or performance conditions have
been satisfied.
Pfizer portfolio
In September 2023, AstraZeneca completed
the definitive purchase and licence
agreement for a portfolio of preclinical rare
disease gene therapy programmes and
enabling technologies from Pfizer. The
agreement has a total consideration of up
to $1 billion, consisting of a $300 million
upfront payment and $700 million of
contingent consideration, plus tiered
royalties on sales.
Commitments and contingencies
We have commitments and contingencies
which are accounted for in line with Group
Accounting Policies and are described in
Note 30 to the Financial Statements from
page 203.
We also have taxation contingencies. These
are described in this Financial Review, in the
Taxation section in the Critical accounting
policies and estimates section from page
152, and in Note 30 to the Financial
Statements from page 211.
Financial position – 31 December 2024
All data in this section are on a
Reported basis.
Acquisitions
In assessing whether an acquired set of
assets and activities is a business or an
asset, management will first elect whether
to apply an optional concentration test to
simplify the assessment. Where the
concentration test is applied, the acquisition
will be treated as the acquisition of an asset
if substantially all of the fair value of the
gross assets acquired (excluding cash and
cash equivalents, deferred tax assets and
related goodwill) is concentrated in a single
asset or group of similar identifiable assets.
Where the concentration test is not applied,
or is not met, a further assessment of
whether the acquired set of assets and
activities is a business will be performed.
Acquisitions treated as business
combinations
Fusion
In June 2024, AstraZeneca completed
the acquisition of Fusion, a clinical-stage
biopharmaceutical company developing
next-generation radioconjugates. The
purchase price allocation review has been
completed. The total consideration fair
value of $2,195 million includes cash
consideration of $2,051 million and future
regulatory milestone-based consideration
of $144 million. Intangible assets of
$1,326 million and goodwill of $947 million
were recognised in the acquisition balance
sheet, as well as a net deferred tax liability
of $246 million. AstraZeneca acquired the
cash and cash equivalents on Fusion’s
balance sheet, which totalled $30 million
at the close of the transaction. Immediately
prior to the acquisition, AstraZeneca held
an approximately 1% shareholding in Fusion
with a fair value of $24 million. Fusion’s
results have been consolidated into the
Group’s results from 4 June 2024.
In December 2024, the intangible asset
relating to the product in development,
FPI-2059, was fully impaired by $165 million
due to portfolio prioritisation decisions.
Development of FPI-2265 and AZD2068 are
still ongoing and continue to be a priority.
For full details of acquisitions,
see Note 27 to the Financial
Statements from page 193.
For further information, see
Business Development on
page 46.
79
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Financial Review
Cellectis
In November 2023, AstraZeneca entered
into an agreement with Cellectis, a clinical-
stage biotechnology company, to accelerate
the development of next-generation
therapeutics in areas of high unmet medical
need, including oncology, immunology and
rare diseases. Cellectis received an initial
payment of $105 million from AstraZeneca,
which comprised a $25 million upfront cash
payment under the terms of a research
collaboration agreement and an $80 million
equity investment. In May 2024, AstraZeneca
completed an additional $140 million equity
investment in Cellectis. The equity
investment and a research collaboration
agreement will leverage the Cellectis
proprietary gene editing technologies and
manufacturing capabilities, to design up to
10 novel cell and gene therapy products for
areas of high unmet medical need, including
oncology, immunology and rare diseases.
Following completion of the additional
$140 million equity investment, AstraZeneca
holds a total equity stake of 44% in the
associate entity.
Eccogene
In November 2023, AstraZeneca and
Eccogene entered into an exclusive licence
agreement for AZD5004, an investigational
oral once-daily GLP
-1RA for the treatment
of obesity, type-2 diabetes and other
cardiometabolic conditions. Preliminary
results from the Phase I trial have shown a
differentiating clinical profile for AZD5004,
with good tolerability and encouraging
glucose and body weight reduction across
the dose levels tested compared to placebo.
Under the terms of the agreement,
Eccogene received an initial upfront
payment of $185 million and is eligible to
receive up to an additional $1.8 billion in
future clinical, regulatory, and commercial
milestones and tiered royalties. AstraZeneca
is granted exclusive global rights for the
development and commercialisation of
AZD5004 for any indication in all territories
except China, where Eccogene has the
right to co-develop and co-commercialise
alongside AstraZeneca.
In addition to the business
development transactions detailed
under Alliance Revenue and Collaboration
Revenue from page 74 of this Financial
Review, the following significant
collaborations remain in the
development phase:
Daiichi Sankyo
In July 2020, AstraZeneca entered
into a new global development and
commercialisation agreement with Daiichi
Sankyo for
Datroway
, its proprietary
TROP2-directed ADC and potential new
medicine for the treatment of multiple
tumour types. AstraZeneca paid Daiichi
Sankyo an upfront payment of $1 billion in
three staged payments and also agreed to
pay additional conditional amounts of up to
$1 billion for the successful achievement of
regulatory approvals and up to $4 billion for
sales-related milestones. The transaction
was accounted for as an intangible asset
acquisition, recognised initially at the
present value of non-contingent
consideration, with any potential future
milestone payments capitalised into the
intangible asset as they are recognised.
The companies will jointly develop and
commercialise
Datroway
worldwide and
will share, equally, development and
commercialisation expenses as well as
profits relating to
Datroway
worldwide,
except for Japan, where Daiichi Sankyo will
retain exclusive rights and be responsible
for such costs and will pay AstraZeneca mid
single-digit royalties. Daiichi Sankyo will
record sales in the US, certain countries in
Europe and certain other countries where
Daiichi Sankyo has affiliates. Profits shared
with AstraZeneca will be recorded as
Alliance Revenue. AstraZeneca will record
Product Sales in other countries worldwide.
Profits shared with Daiichi Sankyo will be
recorded within Cost of sales. Daiichi Sankyo
will manufacture and supply
Datroway
,
which was approved in Japan in 2024 and
the US in January 2025.
Innate Pharma
In April 2015, we entered into two oncology
agreements with Innate Pharma: a licence
which provides us with exclusive global
rights to co-develop and commercialise
IPH2201 in combination with
Imfinzi
; and
an option to license exclusive global rights
to co-develop and commercialise IPH2201
in monotherapy and other combinations in
certain treatment areas. We jointly fund
Phase II studies with Innate Pharma and
we lead the execution of these studies.
In respect of these agreements, we made
an initial payment to Innate Pharma of
$250 million. The agreement also includes a
Phase III initiation milestone of $100 million,
as well as additional regulatory and
sales-related milestones. We record all
sales and pay Innate Pharma double-digit
royalties on net sales. The arrangement
includes the right for Innate Pharma to
co-promote in Europe for an equal share
of costs and income in the territory.
Off balance sheet transactions and
commitments
We have no off balance sheet arrangements
and our derivative activities are
non-speculative. The table on page 78 sets
out our minimum contractual obligations at
the year end.
Research and development collaboration
payments
Details of future potential R&D collaboration
payments are also included in Note 30 to
the Financial Statements from page 203.
As detailed in Note 30, payments to our
partners may not become payable due to
the inherent uncertainty in achieving the
development and revenue milestones linked
to the future payments. We may enter into
further collaboration projects in the future
that may include milestone payments and,
as certain milestone payments fail to
crystallise due to, for example, failure to
obtain regulatory approval, unfavourable
data from key studies, adverse reactions
to the product candidate or indications of
other safety concerns, they may be
replaced by potential payments under
new collaborations.
Investments, divestments and capital
expenditure
We have completed more than 60 major
or strategically important business
development transactions over the past
three years, including:
CSPC Pharmaceutical Group
In October 2024, AstraZeneca entered into
an exclusive licence agreement with CSPC
Pharmaceutical Group Ltd (CSPC) to
advance the development of an early stage,
novel small molecule Lipoprotein (a) (Lp(a))
disruptor that has the potential to offer
additional benefits for patients with
dyslipidaemia. This further strengthens the
Group’s cardiovascular portfolio to help
address the major risk factors driving
chronic cardiovascular disease. Under the
terms of the agreement, AstraZeneca will
receive access to CSPC’s preclinical
candidate small molecule, YS2302018,
an oral Lp(a) disruptor, with the aim of
developing this as a novel lipid-lowering
therapy with potential in a range of
cardiovascular disease indications, alone
or in combination, including with
AstraZeneca’s oral small molecule
PCSK9 inhibitor, AZD0780. CSPC will
receive an upfront payment of $100 million
and is eligible to receive up to $1,920 million
for further development, regulatory and
commercialisation milestones, plus
tiered royalties.
80
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
Financial Review
continued
The Board regularly reviews its distribution
policy and its overall financial strategy to
continue to strike a balance between the
interests of the business, our financial
creditors and our shareholders. Having
regard for business investment, funding the
progressive dividend policy and meeting
our debt service obligations, the Board
currently believes it is appropriate to
continue the suspension of the share
repurchase programme which was
announced in 2012.
The Board reviews the level of distributable
reserves of the Parent Company annually
and aims to maintain distributable reserves
that provide adequate cover for dividend
payments. At 31 December 2024 , the
overwhelming majority of the Profit and loss
account reserve of $13,495 million (2023:
$17,640 million) was available for
distribution, subject to filing these Financial
Statements with Companies House. When
making a distribution to shareholders, the
Directors determine profits available for
distribution by reference to guidance on
realised and distributable profits under the
Companies Act 2006 issued by the Institute
of Chartered Accountants in England and
Accountants of Scotland in April 2017.
The profits of the Parent Company have
been received in the form of receivables
due from subsidiaries. The availability of
distributable reserves in the Parent
Company is dependent on those
receivables meeting the definition of
qualifying consideration within the
guidance, and in particular on the ability
of subsidiaries to settle those receivables
within a reasonable period of time. The
Directors consider that, based on the nature
of these receivables and the available cash
resources of the Group and other accessible
sources of funds, at 31 December 2024,
the overwhelming majority (2023: the
overwhelming majority) of the Company’s
profit and loss reserves were available
for distribution.
Future prospects
As outlined earlier in this Annual Report,
our strategic priorities support delivery of
our Growth Through Innovation strategy
and our Purpose: to push the boundaries of
science to deliver life-changing medicines.
In support of this, we made certain choices
around our three strategic priorities:
•
Science and Innovation
•
Growth and Therapy Area Leadership
•
People and Sustainability.
Full year 2025: additional commentary
Total Revenue is expected to increase by
a
high single-digit percentage. Core EPS
is expected to increase by a low double-
digit percentage.
The Core Tax rate is expected to be
between 18-22%.
The Group is unable to provide guidance on
a Reported basis because it cannot reliably
forecast material elements of the Reported
results, including any fair value adjustments
arising on acquisition-related liabilities,
intangible asset impairment charges and
legal settlement provisions. Please refer
to the Cautionary statement regarding
forward-looking statements on page 244.
Currency impact
If foreign exchange rates for February 2025
to December 2025 were to remain at the
average rates seen in January 2025, it is
anticipated that 2025 Total Revenue for
the year would incur a low single-digit
percentage adverse impact and 2025
Core EPS would incur a mid single-digit
percentage adverse impact versus the
performance at CER.
This commentary represents management’s
current estimates and is subject to change.
See the Cautionary statement regarding
forward-looking statements on page 244.
Financial risk management
Financial risk management policies
Our risk management processes are
described in Risk Overview from page 64.
These processes enable us to identify risks
that can be partly or entirely mitigated
through the use of insurance. We focus our
insurance resources on the most critical
areas, or where there is a legal requirement,
and where we can get the best value for
money through captive, structured and
traditional insurance placements.
Treasury
The principal financial risks to which we are
exposed are those arising from liquidity,
interest rates, foreign currency and credit.
We have a centralised treasury function to
manage these risks in accordance with
Board-approved policies. Note 28 to the
Financial Statements from page 194 sets
out the relevant policies and the way we
manage these risks and our capital
management objectives, as well as a
sensitivity analysis of the Group’s exposure to
exchange rate and interest rate movements.
In October 2018, we exercised our option
over IPH2201 and simultaneously entered
into a further multi-element transaction
with Innate Pharma. Under the agreement,
we paid $50 million to collaborate on, and
acquire an option to license, IPH5201, a
potentially first-in-class anti-CD39 mAb.
Additionally, we paid $20 million to acquire
options over four future programmes
currently being developed by Innate
Pharma, which was expensed as R&D
expenditure over four years, and paid
€62.6 million to acquire a 9.8% stake in
Innate Pharma. The $100 million option fee
and $50 million premium paid over market
price for the investment in Innate Pharma
were capitalised as intangible assets.
We determine these business development
transactions to be significant using a range
of factors. We look at the specific
circumstances of the individual
arrangement and apply several quantitative
and qualitative criteria. As we consider
business development transactions to be an
extension of our R&D strategy, the expected
total value of development payments under
the transaction and its proportion of our
annual R&D spend, both of which are
proxies for overall R&D effort and cost,
are important elements of the determination
of the significance. Other quantitative
criteria we apply include, without limitation,
expected levels of future sales, the possible
value of milestone payments and the
resources used for commercialisation
activities (for example, the number of staff).
Qualitative factors we consider include,
without limitation, new market
developments, new territories, new areas
of research and strategic implications.
Capitalisation and shareholder return
Capitalisation
The total number of shares in issue at
31 December 2024 was 1,551 million
(2023: 1,550 million).
Shareholders’ equity increased by
$1,643 million to $40,786 million at the
year end. Non-controlling interests were
$85 million (2023: $23 million).
Dividend and share repurchases
The Board has recommended a second
interim dividend of $2.10 (168.0 pence,
22.96 SEK) to be paid on 24 March 2025.
This brings the full-year dividend to $3.10
(245.6 pence, 33.75 SEK). Against Reported
EPS, the Group had a dividend cover ratio
of 1.46:1 in 2024 (2023: 1.32:1). Against Core
EPS, the Group had a dividend cover ratio of
2.65:1 in 2024 (2023: 2.50:1). This dividend
is consistent with the progressive dividend
policy, by which, the Board intends to
maintain or grow the dividend each year.
For more information regarding
Dividends, see Note 25 on
page 192.
For more information, see Our
Strategy and Key Performance
Indicators from page 12.
81
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Financial Review
Revenue recognition
Product Sales are recorded at the invoiced
amount (excluding inter-company sales
and value-added taxes), less movements
in estimated accruals for rebates and
chargebacks given to managed care and
other customers, which are a particular
feature in the US and are considered to be
key estimates. It is the Group’s policy to
offer a credit note for all returns and to
destroy all returned stock in all markets.
Cash discounts for prompt payments are
also discounted from sales. Sales are
recognised when the control of the goods
has been transferred to a third party, which
is usually when title passes to the customer,
either on shipment or on the receipt of
goods by the customer, depending on
local trading terms.
Rebates, chargebacks and
returns in the US
When invoicing Product Sales in the US,
we estimate the rebates and chargebacks
that we expect to pay, which are considered
to be estimates. These rebates typically
arise from sales contracts with third-party
managed care organisations, hospitals,
long-term care facilities, group purchasing
organisations and various federal or state
programmes (Medicaid contracts,
supplemental rebates, etc.). They can be
classified as follows:
•
Chargebacks, where we enter into
arrangements under which certain
parties, typically hospitals, long-term care
facilities, group purchasing organisations,
the Department of Veterans Affairs, Public
Health Service Covered Entities, and the
Department of Defense, are able to buy
products from wholesalers at the lower
prices we have contracted with them.
The chargeback is the difference
between the price we invoice to the
wholesaler and the contracted price
charged by the wholesaler to the other
party. Chargebacks are credited directly
to the wholesalers.
•
Regulatory, including Medicaid and other
federal and state programmes, where we
pay rebates based on the specific terms
of agreements with the US Department
of Health and Human Services and with
individual states, which include product
usage and information on best prices and
average market price benchmarks.
•
Contractual, under which entities such as
third-party managed care organisations
are entitled to rebates depending on
specified performance provisions, which
vary from contract to contract.
The effects of these deductions on our US
pharmaceuticals revenue and the movements
on US pharmaceuticals revenue provisions
are set out on page 83.
Accrual assumptions are built up on a
product-by-product and customer-by-
customer basis, taking into account specific
contract provisions coupled with expected
performance, and are then aggregated into
a weighted average rebate accrual rate for
each of our products. Accrual rates are
reviewed and adjusted on an as-needed
basis. There may be further adjustments
when actual rebates are invoiced based
on utilisation information submitted to us
(in the case of contractual rebates) and
claims/invoices are received (in the case
of regulatory rebates and chargebacks).
We believe that we have made reasonable
estimates for future rebates using a similar
methodology to that of previous years.
Inevitably, however, these estimates involve
assumptions in respect of aggregate future
sales levels, segment mix and customers’
contractual performance.
Overall adjustments between gross and
net US Product Sales amounted to
$18,986 million in 2024 (2023: $18,607 million)
with the increase driven predominantly by
increased chargebacks.
Cash discounts are offered to customers to
encourage prompt payment. Accruals are
calculated based on historical experience
and are adjusted to reflect actual experience.
Our revenue recognition policy is described
within Group Accounting Policies from
page 152.
Industry practice in the US allows
wholesalers and pharmacies to return
unused stocks within a certain time frame
based on shelf-life expiry. The customer
is credited for the returned product by the
issuance of a credit note. Returned products
are not exchanged for products from
inventory and once a return claim has been
determined to be valid and a credit note has
been issued to the customer, the returned
products are destroyed. At the point of sale
in the US, we estimate the quantity and
value of products which may ultimately be
returned. Our returns accruals in the US are
based on actual experience. Our estimate
is based on the historical sales and returns
information for established products
together with market-related information,
such as estimated shelf life, product recall,
and estimated stock levels at wholesalers,
which we receive via third-party
information services. For newly launched
products, we use rates based on our
experience with similar products or a
pre-determined percentage.
Critical accounting policies
and estimates
The Consolidated Financial Statements
have been prepared in accordance with
UK-adopted IAS and with the requirements
of the Companies Act 2006 as applicable to
companies reporting under those standards.
The Consolidated Financial Statements also
comply fully with IFRS Accounting Standards
as issued by the IASB and IAS as adopted
by the EU. The accounting policies employed
are set out in the Group Accounting Policies
section from page 152. In applying these
policies, we make estimates and assumptions
that affect the Reported amounts of assets
and liabilities, and disclosure of contingent
assets and liabilities. The actual outcome
could differ from those estimates. Some of
these policies require a high level of
judgement because the areas are especially
subjective or complex.
We believe that the most critical accounting
policies and significant areas of judgement
and estimation are in the following areas
and align with the accounting policies
containing our key accounting judgements,
and significant accounting estimates,
as disclosed in the Financial Statements
from page 152:
•
Revenue recognition – see Revenue
accounting policy on page 152 and
Note 1 on page 160
•
Expensing of internal development
expenses – see Research and
development accounting policy on
page 154
•
Impairment review of Intangible assets
– see Note 10 on page 173
•
Useful economic life of Intangible assets
– see Research and development
accounting policy on page 154
•
Business combinations and Goodwill –
see Business combinations and goodwill
accounting policy on page 157
•
Litigation liabilities – see Litigation and
Environmental Liabilities within Note 30
on page 205
•
Operating segments – see Note 6 on
page 166
•
Employee benefits – see Note 22 on
page 190
•
Taxation – see Tax in Note 30 on page 211.
82
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
Financial Review
continued
Gross to Net Product Sales
US pharmaceuticals
2024
$m
2023
$m
2022
$m
Gross Product Sales
40,641
36,568
32,100
Chargebacks
(3,969)
(3,075)
(2,401)
Regulatory – Medicaid and state programmes
(2,184)
(2,417)
(1,879)
Contractual – Managed care and Medicare
(10,825)
(11,035)
(8,821)
Cash and other discounts
(430)
(428)
(359)
Customer returns
(111)
(222)
(132)
US branded pharmaceutical fee
(114)
(124)
(150)
Other
(1,353)
(1,306)
(1,104)
Net Product Sales
21,655
17,961
17,254
Movements in accruals
US pharmaceuticals
Brought
forward at
1 January
2024
$m
Provision for
current year
$m
Adjustment in
respect of
prior years
$m
Returns and
payments
$m
Carried
forward at
31 December
2024
$m
Chargebacks
245
3,530
46
(3,477)
344
Regulatory – Medicaid and state programmes
986
2,185
(18)
(2,293)
860
Contractual – Managed care and Medicare
3,127
10,962
(122)
(10,901)
3,066
Cash and other discounts
31
430
–
(438)
23
Customer returns
273
98
–
(91)
280
US branded pharmaceutical fee
172
159
(44)
(110)
177
Other
282
1,346
–
(1,400)
228
Total
5,116
18,710
(138)
(18,710)
4,978
Brought
forward at
1 January
2023
$m
Provision for
current year
$m
Adjustment in
respect of
prior years
$m
Returns and
payments
$m
Carried
forward at
31 December
2023
$m
Chargebacks
233
2,743
(22)
(2,709)
245
Regulatory – Medicaid and state programmes
771
2,468
(59)
(2,194)
986
Contractual – Managed care and Medicare
2,426
11,166
(92)
(10,373)
3,127
Cash and other discounts
27
428
–
(424)
31
Customer returns
205
204
–
(136)
273
US branded pharmaceutical fee
137
133
(5)
(93)
172
Other
162
1,303
–
(1,183)
282
Total
3,961
18,445
(178)
(17,112)
5,116
Brought
forward at
1 January
2022
$m
Provision for
current year
$m
Adjustment in
respect of
prior years
$m
Returns and
payments
$m
Carried
forward at
31 December
2022
$m
Chargebacks
181
2,103
(13)
(2,038)
233
Regulatory – Medicaid and state programmes
510
1,953
(79)
(1,613)
771
Contractual – Managed care and Medicare
2,031
8,971
(141)
(8,435)
2,426
Cash and other discounts
21
359
–
(353)
27
Customer returns
196
112
–
(103)
205
US branded pharmaceutical fee
79
138
16
(96)
137
Other
154
1,036
–
(1,028)
162
Total
3,172
14,672
(217)
(13,666)
3,961
83
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Corporate Governance
Financial Review
Strategic Report
The following sections make up the Strategic Report,
which has been prepared in accordance with the
requirements of the Companies Act 2006:
•
Chair’s Statement
•
Chief Executive Officer’s Review
•
What science can do
•
AstraZeneca at a Glance
•
Healthcare in a Changing World
•
Our Purpose, Values and Business Model
•
Our Strategy and Key Performance Indicators
•
Therapy Area Review
•
Business Review
•
Disclosure Statements
•
Risk Overview
•
Financial Review
and has been approved and signed on behalf
of the Board.
A C N Kemp
Company Secretary
6 February 2025
Sarbanes-Oxley Act section 404
As a consequence of our Nasdaq listing,
we are required to comply with those
provisions of the Sarbanes-Oxley Act
applicable to foreign issuers. Section 404 of
the Sarbanes-Oxley Act requires companies
annually to assess and make public
statements about the effectiveness of their
internal control over financial reporting. As
regards to Sarbanes-Oxley Act section 404,
our approach is based on the Committee
of Sponsoring Organizations (COSO)
2013 framework.
Our approach to the assessment has
been to select key transaction and financial
reporting processes in our largest operating
units and a number of specialist areas
(e.g. financial consolidation and reporting,
treasury operations and taxation), so that,
in aggregate, we have covered a significant
proportion of the key lines in our Financial
Statements. Each of these operating units
and specialist areas has ensured that its
relevant processes and controls are
documented to appropriate standards,
taking into account, in particular, the
guidance provided by the US Securities
and Exchange Commission (SEC).
We have also reviewed the structure and
operation of our ‘entity level’ control
environment. This refers to the overarching
control environment, including structure of
reviews, checks and balances that are
essential to the management of a well-
controlled business.
84
AstraZeneca
Annual Report & Form 20-F Information 2024
Strategic Report
Financial Review
continued
Corporate
Governance
Contents
Chair’s Introduction
86
Corporate Governance Overview
87
Board of Directors
88
Senior Executive Team (SET)
90
Corporate Governance Report
91
Nomination and Governance Committee Report
100
Science Committee Report
102
Sustainability Committee Report
103
Audit Committee Report
104
Directors’ Remuneration Report
112
Corporate Governance
Additional Information
Financial Statements
Strategic Report
85
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
“In all its deliberations, the Board considers the
interests of stakeholders and, in addition to
management’s interactions, undertakes direct
engagement with stakeholders.”
The Board
During 2024, the Board continued to
support the Company’s delivery of its
strategy to promote its long-term
sustainable success. This included
approving the Budget and Funding Plan
as well as the Annual Strategy Review
and Long-Term Plan. We also considered,
and approved, a number of acquisitions
to strengthen the Group’s pipeline and
accelerate the development of potentially
life-changing medicines.
In all its deliberations, the Board considers
the interests of stakeholders and, in addition
to management’s interactions, undertakes
direct engagement with stakeholders.
In 2024, this included engaging with
employees and external stakeholders at our
meeting in Gothenburg, Sweden. I continue
to engage with shareholders directly, in
particular at the World Economic Forum in
Davos and as part of the European Round
Table of Industry.
Board Committees
The work of the full Board is complemented
by the work of its Committees.
The Audit Committee has an important
role to play in monitoring the integrity of
financial reporting, reviewing the
effectiveness of internal controls, risk
management and compliance. Key activities
in 2024 included consideration as well as
in-depth reviews related to our key risks.
This included consideration of the
investigations by Chinese authorities into
current and former AstraZeneca employees
and the Company; a topic which was also
reviewed by the full Board.
During the year, the Audit and Sustainability
Committees worked together on
developments in the reporting and
regulatory environment in relation to
sustainability-related disclosures, including
the approach we have adopted in 2024 and
intend to take in 2025.
The Science Committee continues to carry
out its valuable work providing assurance
regarding the quality, competitiveness and
integrity of the Group’s R&D activities. In
2024, this included a two-day meeting at
our site in Shanghai, China which provided
opportunities to engage with R&D employees.
Finally, the Remuneration Committee was
pleased that the majority of shareholders
supported the new Remuneration Policy at
the 2024 AGM. This allows us to continue to
provide competitive executive remuneration
and drive a high-performance culture.
During the year, the Committee engaged
with investors, including discussions about
details of its proposed implementation of
the Policy. It also worked closely with the
Sustainability Committee when reviewing
the sustainability metric within the long-
term incentive which, for awards granted
from 2025 onwards, will focus on reduction
in Value Chain (Scope 3) GHG emissions.
Annual General Meeting
In 2024, the Board held its first digitally-
enabled AGM. It was broadcast live,
which allowed our geographically diverse
shareholder base to participate in the
meeting and engage with the Directors.
I look forward to chairing our 2025 digitally-
enabled AGM in April and engaging with as
many of you as possible.
Michel Demaré
Chair
In my first full year as Chair, I am grateful
to my fellow Directors for the continued
role they play in overseeing the highest
standards of governance in the Company
and carrying out their roles with integrity,
diligence and professionalism.
I am particularly grateful to the Chairs of
the Board Committees for the important
additional responsibilities they bear.
New Non-Executive Directors
I would like to welcome Rene Haas and
Birgit Conix to the Board. Both joined at the
start of 2025, with Rene bringing deep and
broad knowledge of technology including
data science, computing and AI from his
experience in the microprocessor,
semiconductor and software engineering
industry. Birgit brings significant financial
and executive experience through
successive Chief Financial Officer roles as
well as experience of the pharmaceutical
industry, and will be a valuable addition to
the Audit Committee.
The appointment of Rene and Birgit
highlights the importance of the Nomination
and Governance Committee in succession
planning, including taking the lead in the
search for and recruitment of new Directors.
We also ensure the Board has a balance of
expertise, experience and diversity.
The Committee also manages, on a
continuous basis, the process of
anticipating the potential succession of
our CEO, combining a thorough review
of our internal bench with a careful
monitoring of external talent.
Good corporate governance
underpins any successful
business and is a prime
responsibility of the Board.
Corporate Governance
86
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Annual Report & Form 20-F Information 2024
Chair’s Introduction
The Board’s responsibilities include
setting our strategy and policies,
overseeing risk and corporate governance,
and monitoring progress towards meeting
our objectives and annual plans. It is
accountable to our shareholders for the
proper conduct of the business and our
long-term success, and seeks to represent
the interests of all stakeholders.
The CEO, CFO and the SET take the lead
in developing our strategy; proposals are
reviewed and constructively challenged by
the Board, before the strategy is approved.
The Directors are collectively responsible
for the success of the Group. The Board
maintains and periodically reviews a list
of matters that can only be approved by
the Board. Matters that have not been
expressly reserved to the Board in this
way are delegated to the CEO or one of
the Board’s five Committees. The diagram
below illustrates this governance structure.
Governance structure
Audit
Committee
Report from page 104
Nomination and
Governance Committee
Report from page 100
Remuneration
Committee
Report from page 112
Science
Committee
Report from page 102
Sustainability
Committee
Report from page 103
The Board has delegated some of its powers to the CEO and operates with the assistance of five Committees:
Board
Corporate Governance Report from page 91
Attendance in 2024
Board Committee membership and meeting attendance in 2024
Board/Committee Chair
Director
Appointment
date
1
Board
2
Audit
Committee
Remuneration
Committee
Nomination and
Governance
Committee
Science
Committee
Sustainability
Committee
Non-Executive Chair and Executive Directors
Michel Demaré
01/09/2019
10/10
7/7
5/5
Pascal Soriot
01/10/2012
10/10
Aradhana Sarin
01/08/2021
10/10
Non-Executive Directors
Euan Ashley
3
01/10/2020
9/10
5/5
5/5
Philip Broadley
4
27/04/2017
10/10
6/6
6/7
4/5
Deborah DiSanzo
3,4
01/12/2017
8/10
6/6
Diana Layfield
3
01/11/2020
9/10
5/5
Sheri McCoy
01/10/2017
10/10
6/6
7/7
5/5
2/2
Tony Mok
4
01/01/2019
9/10
5/5
Nazneen Rahman
01/06/2017
10/10
7/7
5/5
5/5
2/2
Andreas Rummelt
3
01/08/2021
9/10
2/2
Marcus Wallenberg
4
05/04/1999
9/10
2/5
1/2
Anna Manz
4
01/09/2023
9/10
6/6
1
Date of first appointment or election to the Board.
2
Six Board meetings in 2024 were held by videoconference and four were held in person at the Company’s sites in Cambridge and London, UK and Gothenburg, Sweden.
3
One Board meeting was called urgently at very short notice during the year. Due to time zones, a medical appointment and the very short notice, as reflected in the table above,
these Board members were unable to participate but were fully briefed following the meeting.
4
These Board members missed one or more meetings due to scheduling conflicts with other board meetings and/or travel plans.
Corporate Governance
Additional Information
Financial Statements
Strategic Report
87
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance Overview
Corporate Governance Overview
Michel Demaré
NG
R
Non-Executive Chair of the Board
Skills and experience:
Michel was
previously Vice-Chairman of UBS
Group AG (2010-2019), Chairman of
Syngenta and Syngenta Foundation
for Sustainable Agriculture
(2013-2017) and Chairman of
SwissHoldings (2013-2015).
Between 2005 and 2013, Michel was
CFO of ABB Ltd and interim CEO
during 2008. He joined ABB from
Baxter International Inc., where he
was CFO Europe from 2002 to 2005.
Prior to that, he spent 18 years at
The Dow Chemical Company,
serving as CFO of Dow’s Global
Polyolefins and Elastomers division
between 1997 and 2002.
Other appointments:
Michel is a
Non-Executive Director of Vodafone
Group plc and Louis Dreyfus Int’l
Holding BV and Chairman of IMD
Business School.
Philip Broadley
A
NG
R
Senior independent Non-
Executive Director
Skills and experience:
Philip was
previously Group Finance Director
of Prudential and Old Mutual. He has
served as Chairman of the 100
Group of Finance Directors and as a
member of the Takeover Panel. He is
a Fellow of the Institute of Chartered
Accountants in England and Wales.
Philip graduated in Philosophy,
Politics and Economics from the
University of Oxford, where he is a
St Edmund Fellow, and holds an MSc
in Behavioural Science from LSE.
Other appointments:
Philip is the
Non-Executive Chair of Lancashire
Holdings Limited and serves as a
Non-Executive Director of Legal &
General Group plc.
Pascal Soriot
Executive Director and CEO
Skills and experience:
Pascal brings
a passion for science and medicine,
significant experience in established
and emerging markets, strength of
strategic thinking and execution,
a successful track record of
managing change and executing
strategy, and the ability to lead a
diverse organisation. He served as
COO of Roche’s pharmaceuticals
division and, prior to that, as CEO
of Genentech. Pascal has worked in
senior management roles in several
major companies around the world.
He is a Doctor of Veterinary Medicine
and holds an MBA from HEC Paris.
In 2022, Pascal received a
knighthood for services to life
sciences and leadership in the global
response to the COVID-19 pandemic.
Other appointments:
Pascal is on
the Board of Sustainable Markets
Initiative Limited.
Euan Ashley
Sc
NG
Non-Executive Director
Skills and experience:
Euan studied
physiology and medicine at Glasgow
University, trained as a junior doctor
at Oxford University Hospitals NHS
Trust, and gained a DPhil in
cardiovascular cellular biology and
molecular genetics at the University
of Oxford. In 2002, Euan moved to
Stanford University, where his
research focuses on genetic
mechanisms of cardiovascular health
and disease. His laboratory leverages
AI and digital health tools, alongside
biotechnology partners, to advance
translational and clinical research.
Euan’s awards include recognition
from the White House for contributions
to personalised medicine and the
American Heart Association’s Medal
of Honor for precision medicine.
Other appointments:
Euan is the
Arthur L. Bloomfield Professor of
Medicine, Genetics and Biomedical
Data Science, and the Chair of
the Department of Medicine at
Stanford University.
Aradhana Sarin
Executive Director and CFO
Skills and experience:
Before
joining AstraZeneca, Aradhana was
CFO for Alexion, responsible for
driving strategic growth, financial
performance and business
development. She has eight years
of operational experience in
biopharma, plus more than 20 years
of professional experience at global
financial institutions and extensive
knowledge of global healthcare
systems. This includes tenures at
Citi Global Banking, UBS, and
JP Morgan. Aradhana trained as a
medical doctor in India and spent
two years practising in both India
and Africa. She completed her
medical training at the University
of Delhi and received her MBA from
Stanford Business School.
Other appointments:
Aradhana
is on the Board of Governors of
the American Red Cross and is
an Independent Director and
Audit Committee member of
Anheuser-Busch InBev.
Deborah DiSanzo
A
Non-Executive Director
Skills and experience:
Deborah has
more than 30 years’ experience in
healthcare and technology. She is
currently President of Best Buy
Health, which provides digital health
solutions in ageing and care at
home. Until the end of 2018,
she served as General Manager of
IBM Watson Health and prior to IBM,
held multiple senior executive
positions at Philips Healthcare
where she also was Chief Executive
Officer. Deborah has an
appointment at and teaches Artificial
Intelligence in Health at the Harvard
TH Chan School of Public Health.
She has been honoured by multiple
organisations as a top health
influencer. She holds an MBA from
Babson College and is a Harvard
University Advanced Leadership
Initiative 2019 Fellow.
Other appointments:
Deborah is
President of Best Buy Health.
0-3 years
3
Anna Manz
Rene Haas
Birgit Conix
6 years plus
6
Philip Broadley
Deborah DiSanzo
Sheri McCoy
Tony Mok
Nazneen Rahman
Marcus Wallenberg
3-6 years
4
Michel Demaré
Euan Ashley
Diana Layfield
Andreas Rummelt
8
Men
7
Women
5
British
4
American
2
Belgian
1
Swedish
1
Canadian
1
French
1
German
Gender split of Directors
Directorsʼ nationalities
Length of tenure of
Non-Executive Directors
Board composition
as at 6 February 2025
Committee membership key
Committee
Chair
NG
Nomination and
Governance
A
Audit
Sc
Science
R
Remuneration
Su
Sustainability
Corporate Governance
88
AstraZeneca
Annual Report & Form 20-F Information 2024
Board of Directors
as at 6 February 2025
Appointed post year-end
Diana Layfield
Sc
Non-Executive Director
Skills and experience:
Diana has
broad global business experience
across technology, life sciences and
financial services. She has held
senior leadership roles at Google,
Standard Chartered Bank, as the
CEO of a start-up technology
company, and in Healthcare and
Life Sciences at McKinsey & Co.
Previously at Google, Diana was
General Manager, Search
International & Growth (including
Product and Engineering) and
President, EMEA Partnerships and
Vice-President, ‘Next Billion Users’.
Until December 2020, Diana was a
Non-Executive Director of Aggreko
plc. She has a BA from Oxford
University and an MA in International
Economics and Public Administration
from Harvard University.
Other appointments:
Diana is
the Chair of British International
Investment plc and a Council
Member of the London School
of Hygiene & Tropical Medicine.
Anna Manz
A
Non-Executive Director
Skills and experience:
Anna was
CFO and a member of the Board of
Directors of London Stock Exchange
Group plc until 2024. From 2016 to
2020, she was an Executive Director
and the CFO of Johnson Matthey Plc
and, before that, spent 17 years at
Diageo plc in a number of senior
finance roles. She brings extensive
expertise in accounting, corporate
finance and M&A, as well as
experience of business
diversification, transformation and
strategy. Anna was previously a
Non-Executive Director of ITV plc
and served on its Audit Committee
and Remuneration Committee
during most of that period.
Other appointments:
Anna is
CFO of Nestlé S.A. and a member
of Nestlé’s Executive Board.
Sheri McCoy
R
A
NG
Su
Non-Executive Director
Skills and experience:
Until
February 2018, Sheri was CEO and
a Director of Avon Products, Inc.
and, prior to that, had a 30-year
career at Johnson & Johnson (J&J),
latterly serving as Vice-Chairman
of the Executive Committee,
responsible for the Pharmaceuticals
and Consumer business segments.
Sheri joined J&J as an R&D scientist
and subsequently managed
businesses in every major product
sector. She holds a BSc in Textile
Chemistry from the University of
Massachusetts Dartmouth, an MSc
in Chemical Engineering from
Princeton University and an MBA
from Rutgers University.
Other appointments:
Sheri serves
on the Boards of Stryker,
Kimberly-Clark, Galderma and
Sail Biomedicines. She is also an
industrial adviser for EQT, and in
connection serves as Chair of
Parexel and Chair of Dechra.
Tony Mok
Sc
Non-Executive Director
Skills and experience:
Tony is the
Li Shu Fan Medical Foundation
endowed Professor and Chairman of
the Department of Clinical Oncology
at the Chinese University of Hong
Kong. His work includes multiple
aspects of lung cancer research,
including biomarker and molecular
targeted therapy in lung cancer.
Tony is the Past President of the
International Association for the
Study of Lung Cancer and a past
Board member of the American
Society of Clinical Oncology. He
has achieved numerous awards
including the European Society for
Medical Oncology (ESMO) Lifetime
Achievement Award, Giant of Cancer
Care, and the Bronze Bauhinia Star.
Other appointments:
Tony is
Non-Executive Director of
HUTCHMED (China) Limited,
member of the Scientific Advisory
Board of Prenetics Global Limited
and serves on the Board of Insighta.
Nazneen Rahman
Su
NG
R
Sc
Non-Executive Director
Skills and experience:
Nazneen has
significant experience in rare disease
and cancer genomics and sustainable
healthcare. She qualified in medicine
from Oxford University, is an
accredited specialist in medical
genetics and has a PhD in molecular
genetics. Nazneen was Professor of
Genetics at the Institute of Cancer
Research, Head of Cancer Genetics
at the Royal Marsden NHS
Foundation Trust, and founder and
Director of the TGLclinical Genetic
Testing Laboratory until 2018. In
2020, Nazneen founded YewMaker
to build science-based sustainable
healthcare solutions. Nazneen has a
strong commitment to open science
and has garnered numerous awards,
including a CBE in recognition of her
contribution to medical sciences.
Other appointments:
Nazneen is
CEO of YewMaker and Director of the
Sustainable Medicines Partnership.
Andreas Rummelt
Su
Non-Executive Director
Skills and experience:
Andreas
joined the Board following the
acquisition of Alexion, where he
had been a Director since 2010.
Previously he was at Novartis AG
where he served on the Executive
Committee from 2006 to 2010.
He had been Group Head of
Technical Operations and Quality
from 2009 until 2010. He was Global
CEO of Sandoz, the Generics
Division of Novartis from 2004 to
2008, having originally joined in
1985. Andreas earned his PhD in
pharmaceutical sciences from the
University of Erlangen-Nuremberg
and received his executive training
in general management and
leadership from IMD in Lausanne,
INSEAD in Fontainebleau and
Harvard Business School.
Other appointments:
Andreas is
Chairman of InterPharmaLink AG
since 2011 and a director of various
privately-held biotech and
pharmaceutical companies.
Marcus Wallenberg
Sc
Su
Non-Executive Director
Skills and experience:
Marcus has
international business experience
across various industry sectors,
including the pharmaceutical
industry from his directorship with
Astra prior to 1999.
Other appointments:
Marcus is
Chair of Skandinaviska Enskilda
Banken AB, Saab AB, Wallenberg
Investments AB and FAM AB. He is
Vice-Chair of Investor AB and
Vice-Chair of EQT AB. Marcus is
also Chair of the Royal Swedish
Academy of Engineering Sciences
and a Board member of the Knut
and Alice Wallenberg Foundation.
Rene Haas
Non-Executive Director
Rene Haas has been Arm’s CEO since
February 2022. He previously held
roles at NVIDIA, Scintera Networks
and Tensilica, and serves on the
Boards of Arm China and SoftBank.
Birgit Conix
A
Non-Executive Director
Birgit Conix is former CFO at
Sonova, TUI and Telenet. She
previously held roles at J&J,
Heineken, Tenneco and Reed
Elsevier. She is on the Supervisory
Board of ASML and is Chair of its
ESG Committee and a member of
its Audit Committee.
Corporate Governance
Additional Information
Financial Statements
Strategic Report
89
AstraZeneca
Annual Report & Form 20-F Information 2024
Board of Directors
The SET is the body through which the
CEO exercises the authority delegated
to him by the Board. The CEO leads the
SET and has executive responsibility
for the management, development and
performance of the business. The CEO,
CFO and the SET also take the lead in
developing the strategy for review,
constructive challenge and approval
by the Board as part of the annual
strategy review process.
The SET members who sit on the Board:
•
Pascal Soriot, CEO
•
Aradhana Sarin, CFO
Sharon Barr
Executive Vice-President,
BioPharmaceuticals R&D
Sharon was appointed as Executive
Vice-President, BioPharmaceuticals
R&D in August 2023. She is
responsible for discovery through
to late-stage development across
CVRM and Respiratory & Immunology.
Previously, Sharon was SVP, Head of
Research and Product Development
of Alexion. Sharon undertook a PhD
in molecular biology from NYU and
a postdoctoral fellowship at
Stanford University.
Marc Dunoyer
CEO, Alexion and Chief Strategy
Officer, AstraZeneca
Marc served as AstraZeneca’s Chief
Financial Officer until 2021.
Previously, he served as Global
Head of Rare Diseases at GSK and
(concurrently) Chairman of GSK
Japan. He holds an MBA from HEC
Paris and a Bachelor of Law degree
from Paris University.
Jeff Pott
Chief Human Resources Officer,
Chief Compliance Officer and
General Counsel
Jeff is responsible for all aspects
of AstraZeneca’s People strategy
and leads our HR, Compliance,
Legal and IP functions. Jeff joined
in 1995, before which he specialised
in pharmaceutical product liability
and antitrust litigation. He holds a
Bachelor’s degree from Wheaton
College and a Juris Doctor Degree
from Villanova University.
Pam Cheng
Executive Vice-President,
Global Operations, IT & Chief
Sustainability Officer
Pam was appointed Executive
Vice-President, Operations & IT
in June 2015 and took on the
sustainability strategy in January
2023. Prior to AstraZeneca, she
worked for Merck/MSD, Universal
Oil Products, Union Carbide and
GAF Chemicals. She holds
Bachelor’s and Master’s degrees in
chemical engineering from Stevens
Institute of Technology and an MBA
from Pace University.
David Fredrickson
Executive Vice-President, Oncology
Haematology Business Unit
Dave is responsible for driving
growth and maximising commercial
performance of the AstraZeneca
global Oncology and Haematology
portfolio. Before joining AstraZeneca,
Dave worked at Roche/Genentech,
where he served in several functions
and leadership positions. Dave is a
graduate of Georgetown University
in Washington DC.
Iskra Reic
Executive Vice-President,
International
Iskra serves as the Executive
Vice-President, International. She is
responsible for overall strategy and
driving sustainable growth across
the International region, which
includes China, Asian and Eurasian
markets, Middle East & Africa, Latin
America, Australia and New Zealand.
Iskra has a PhD in Strategy and
Leadership and an International
Executive MBA in Business and
Leadership from the IEDC-Bled
School of Management, Slovenia.
Ruud Dobber
Executive Vice-President,
BioPharmaceuticals Business Unit
Ruud is responsible for the disease
areas of CVRM, Respiratory &
Immunology and Vaccines &
Immune Therapies. Ruud joined
AstraZeneca in 1997 and held
various executive roles externally
before this. Ruud was previously a
research scientist in immunology
and ageing, holding a PhD in
Immunology from the University
of Leiden, the Netherlands.
Susan Galbraith
Executive Vice-President,
Oncology Haematology R&D
Susan has global accountability
for Oncology and Haematology
R&D from discovery through to
late-stage development. Susan
joined AstraZeneca in 2010,
having previously worked at BMS.
She graduated in medicine from
Cambridge University, has a PhD from
the University of London and qualified
as a Clinical Oncologist in 2001.
Menelas (Mene)
Pangalos
Formerly Executive
Vice-President,
BioPharmaceuticals R&D and
SET member 2013-2023
Mene retired from
AstraZeneca in early 2024.
Leon Wang
Formerly Executive
Vice-President, International
and China President and SET
member 2017-2024
Leon was Iskra Reic’s
predecessor as Executive
Vice-President, International.
He is on extended leave from
the Company while under
investigation in China.
Further information on the SET
members is available on our
website, www.astrazeneca.com.
See Board of Directors
biographies from page 88.
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Senior Executive Team (SET)
as at 6 February 2025
B. Purpose, culture and strategy
The Board believes that our Purpose, to push
the boundaries of science to deliver life-
changing medicines, positions AstraZeneca
for long-term sustainable success.
Our Code of Ethics and our Values
underpin how we work together and the
behaviours that drive our success and
support our culture.
The Board is responsible for setting our
strategy and policies, overseeing risk and
corporate governance, and monitoring
progress towards meeting our objectives
and annual plans. The Board conducts an
annual review of the Group’s overall strategy.
C. Resources and controls
The Board ensures that the necessary
resources are in place to help the Company
meet its objectives and measure its
performance against them.
The Group Internal Audit (GIA) and
Compliance functions provide quarterly
reports to the Audit Committee on their
activities and annual reviews of key themes,
processes and systems (including
arrangements for whistleblowing). The
Board has full oversight of these matters by
way of the Audit Committee Chair’s reports
to the Board after each Committee meeting.
Board members are also able to access the
information provided to the Audit Committee.
The Board has a formal system in place for
Directors to declare a conflict, or potential
conflict, of interest.
D. Stakeholder engagement
The Board aims to ensure a good dialogue
is maintained with shareholders, so that
their views are understood and considered.
The Board also engages with and considers
wider stakeholder groups, including the
workforce, in its decision making.
E. Workforce policies
Based on our Values, expected behaviours
and key policy principles, the Code of Ethics
empowers employees to make decisions in
the best interests of the Group, the
Company, society and the patients we
serve. It is applicable to the Group
worldwide, including the Board. Employees
are able to raise concerns anonymously via
the AZ Ethics helpline.
2. Division of responsibilities
F. Chair of the Board
Michel Demaré, our Non-Executive Chair,
is responsible for the Board’s overall
effectiveness in directing the Company.
Mr Demaré was first appointed to the
Board in 2019 and was considered to be
independent on his appointment as Chair
in April 2023.
G. Board composition, independence
and division of responsibilities
The composition of the Board is set out
on pages 88 and 89. The majority of
the Board consists of independent
Non-Executive Directors. Directors’
independence is considered annually
by the Board, as described on page 93.
The Directors are collectively responsible
for the success of the Group. The roles of
the Board, Board Committees, Chair, senior
independent Non-Executive Director and
CEO are documented, as are the Board’s
reserved powers and delegated authorities.
The Board’s responsibilities and the
governance structure by which it delegates
authority are outlined in the Corporate
Governance Overview on page 87.
The Board maintains a list of matters that
are reserved to, and can only be approved
by, the Board. These include: the
appointment, termination and remuneration
of any Director; approval of the annual
budget; approval of any item of fixed capital
expenditure or any proposal for the
acquisition or disposal of an investment or
business which exceeds $300 million; the
raising of capital or loans by the Company
(subject to certain exceptions); the giving of
any guarantee in respect of any borrowing
of the Company; and allotting shares of the
Company. Matters that have not been
expressly reserved to the Board are delegated
to the Committees of the Board or the CEO.
H. Non-Executive Directors’ role and
time commitment
The Non-Executive Directors exercise
objective judgement in respect of Board
decisions, providing scrutiny and challenge
and holding management to account.
Non-Executive Directors offer strategic
guidance and specialist advice based on
their breadth of experience and knowledge.
The Non-Executive Directors regularly meet
without the Executive Directors or other
management present.
Statement of compliance
Our statement of compliance below
describes how we applied the principles
in the 2018 UK Corporate Governance Code
(the Code) for the year ended 31 December
2024. A copy of the Code can be found on
the Financial Reporting Council’s (FRC)
website, www.frc.org.uk. Throughout the
accounting period we have complied with
all the provisions of the Code.
Additional information for
Swedish shareholders
The Company is incorporated under the
laws of England and Wales and its shares
are listed on the London Stock Exchange,
Nasdaq Stockholm and the Nasdaq Global
Select Market in the US. In accordance with
the Company’s listing on the London Stock
Exchange, it applies the principles set out in
the Code. As a result of its listing on Nasdaq
Stockholm and in accordance with Swedish
regulations, the Company is required to
disclose the material ways in which its
corporate governance practices differ
from those applied by Swedish companies
following the Swedish Corporate
Governance Code (the Swedish Code).
The Company has made available on its
website, www.astrazeneca.com/investor-
relations/corporate-governance.html, a
summary of the material ways in which the
corporate governance practices applied by
the Company differ from the principles of
the Swedish Code. In addition, as required
by Swedish regulations, the Company has
also made available on its website a general
description of the main differences in
minority shareholders’ rights between the
Company’s place of domicile (the UK) and
Sweden, where the Company’s shares are
also admitted to trading.
1. Board leadership and
Company purpose
A. Board’s role
The Board’s role is to promote the long-term
sustainable success of the Company.
The Directors’ diverse range of skills,
experience and industry knowledge,
and ability to exercise independent and
objective judgement, help the Board to
operate effectively in its oversight of
delivery of the Group’s strategy, generation
of shareholder value and contributions to
wider society.
The Board’s effective operation is
underpinned by a sound governance
structure, described on page 87.
Through a programme of regular Board
and Board Committee meetings, Directors
receive information on AstraZeneca’s
financial performance, the R&D pipeline
and critical business issues. The Board is
accountable to our shareholders for the
proper conduct of the business and our
long-term success and seeks to represent
the interests of all stakeholders.
For more information on:
Our Purpose, our Values
and our Business Model,
see page 10.
Standards and Policies,
including Code of Ethics,
see page 42.
Our resources and controls,
see the Audit Committee
Report from page 104.
Conflicts of interest, see
page 228.
Stakeholder engagement,
see pages 94 to 96 and
throughout the Strategic
Report. Our section 172(1)
statement is set out on
page 63.
Corporate Governance
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Financial Statements
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The performance of the Non-Executive
Directors is assessed annually as part of
the Board’s performance evaluation, as
described on page 99.
Subject to specific Board approval,
Executive Directors and the SET members
may accept external appointments as
non-executive directors of other companies
and retain any related fees paid to them,
provided that such appointments are not
considered by the Board to prevent or
reduce the ability of the executive to
perform his or her role within the Group
to the required standard.
I. Company Secretary
The Company Secretary is responsible to the
Chair for ensuring that all Board and Board
Committee meetings are properly conducted,
that the Directors receive appropriate
information prior to meetings to enable them
to make an effective contribution and that
governance requirements are considered and
implemented. The 2024 Board performance
evaluation set out on page 99 provides
details of the effective operation of the Board.
3. Composition, succession and
evaluation
J. Appointments and succession planning
The Nomination and Governance
Committee and, where appropriate, the full
Board, regularly review the composition of
the Board and the status of succession to
both the SET- and Board
-level positions.
Directors have regular contact with, and
access to, succession candidates for
the SET positions. The Committee also
recognises the importance of diversity
when considering potential appointments.
There is a formal, rigorous and transparent
procedure for appointments to the Board.
The Nomination and Governance
Committee Report details the process
for appointments approved during the
year from page 100. The Nomination and
Governance Committee also reviews
succession plans for the Board and
senior management.
In accordance with Article 66 of the
Articles of Association of the Company, all
Directors retire at each AGM and may offer
themselves for re-election by shareholders.
The Notice of AGM will give details of those
Directors seeking election or re-election.
K. Skills, experience and knowledge
When the Nomination and Governance
Committee reviews the composition of the
Board and its Committees, it uses a matrix
that records the skills and experience of
current Board members and compares this
with the skills and experience it believes
are appropriate to the Company’s overall
business and strategic needs, both now
and in the future.
The Committee is also mindful of Directors’
lengths of tenure and the need to refresh
Board membership over time.
L. Board evaluation
In 2024, the Board undertook an external
Board performance evaluation. More
information on the evaluation process,
including the results and actions taken,
can be found on page 99.
4. Audit, risk and internal control
M. Internal and external audit
The Audit Committee is responsible for
reviewing the relationship and independence
of our external auditor, PwC. The Committee
maintains a policy for the pre-approval of all
audit services and audit-related services
undertaken by the external auditor, the
principal purpose of which is to ensure that
the independence of the external auditor is
not impaired. A tender of audit services
was conducted during the year as
described on page 111.
The Audit Committee also reviews the
independence and effectiveness of GIA.
N. Fair, balanced and understandable
assessment
The Board considers this Annual Report,
taken as a whole, to be fair, balanced
and understandable, and provides the
information necessary for shareholders
to assess AstraZeneca’s position and
performance, business model and strategy.
The Board’s assessment is described on
page 110.
The Board and the Audit Committee review
the Company’s quarterly financial results
announcements to ensure they present a
fair, balanced and understandable
assessment of the Company’s position
and prospects to shareholders.
O. Risk management
The Board is responsible for the Company’s
risk management system and internal
controls, and their effectiveness. The Board
delegates some responsibilities for risk
management oversight to the Audit
Committee, such as quarterly reviews of the
Company’s principal and key active risks.
During 2024, the Directors continued to
review the effectiveness of our system of
controls, risk management (including a
robust assessment of the emerging and
principal risks) and high-level internal control
processes. This included an annual
Governance and Assurance Report to all
Directors, which is considered in detail by the
Audit Committee and reviewed by the Board.
Any areas of concern are highlighted in the
Audit Committee Chair’s update to Directors
at the relevant Board meeting and discussed
by the Board. The report is based on a full
year-end review of the Company’s risk and
The Company’s senior independent
Non-Executive Director serves as a
sounding board for the Chair and as an
intermediary for the other Directors when
necessary. The senior independent
Non-Executive Director is also available
to shareholders if they have concerns that
contact through the normal channels of
Chair or Executive Directors has failed
to resolve, or for which such contact is
inappropriate. Philip Broadley was
appointed senior independent Non-
Executive Director on 1 March 2021.
As well as their work in relation to formal
Board and Board Committee meetings,
Non-Executive Directors commit time
throughout the year to meetings and
telephone calls with various levels of
executive management and other key
stakeholders, visits to AstraZeneca’s sites
throughout the world (whether in person or
virtually) and, for new Directors, induction
sessions and site visits. The Chair and
individual Board members ensure that Board
members’ time commitment to the Company
is sufficient to fulfil their duties as Directors
and fully discharge their obligations to
shareholders, particularly in the case of the
Chairs of Board Committees. For the Chair of
the Board, generally, as a basic commitment,
it is expected that they would need to devote
about 40% of their time or the equivalent of
not less than 90 days per annum in the
fulfilment of their duties.
When contemplating taking up additional
appointments, Non-Executive Directors
consult the Chair to ensure thought is given
to any potential impact on their time
commitment to AstraZeneca. Careful
consideration is given to the nature of the
potential appointment and the type of
company involved (for example, whether
the company is a public listed company or
privately held), to help assess the likely
time requirement. For significant additional
appointments, the full Board would
typically be involved in this process.
For more information on:
The work of the Nomination
and Governance Committee,
see from page 100.
External audit, see page 106
and Note 31 to the Financial
Statements, see page 213.
Internal Audit, see page 106.
Our Viability statement on
page 63 and the ways in which
we identify and manage our
risks, see Further information
on risk management and
controls on the following page,
and the Risk Overview from
page 64.
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continued
shareholder – the Board does not believe
that he can be determined independent
under the Code.
As well as being a Non-Executive Director
of AstraZeneca and Chair of the Board’s
Sustainability Committee, Nazneen Rahman
is the Director of the Sustainable Medicines
Partnership (SMP), a multi-stakeholder,
not-for-profit collaboration with the aim of
advancing the environmental sustainability
of medicines. AstraZeneca is a strategic
collaborator in the SMP. Dr Rahman has
recused herself from acting as the lead
contact for the SMP in its relationship with
AstraZeneca, and this relationship, including
project work and overall programme
management, is handled by other members
of the SMP team.
2024 AGM voting outcomes
At the Company’s 2024 AGM, some
shareholders expressed concerns
regarding the re-election of Marcus
Wallenberg and resolutions in relation
to Directors’ remuneration.
In relation to Mr Wallenberg, 77.93% of
shareholders voted in favour of his re-election
as a Director of the Company. The Board
understands that some shareholders have
concerns regarding Mr Wallenberg’s other
directorships and the potential for those to
impact his time commitment to the Company.
The Board recognises that Mr Wallenberg has
a wide portfolio of other roles, but believes he
has brought, and continues to bring,
considerable business experience and makes
a valuable contribution to the work of the
Board, which his portfolio of other roles
supports. The Board is also satisfied that he is
able to devote sufficient time to discharge his
responsibilities as a Director. The Board
therefore supports his re-election as a
Director at the 2025 AGM.
Although resolutions to approve a new
Remuneration Policy and amendments to
the AstraZeneca Performance Share Plan
2020 were passed by shareholders with
64.43% and 65.34% of the votes
respectively, a significant proportion of
shareholders voted against each resolution.
Following the AGM, the Remuneration
Committee Chair undertook an extensive
consultation process to listen to the
feedback of our shareholders’ and the proxy
agencies, and to discuss the implementation
of the 2024 Policy. Further information is
included in the Directors’ Remuneration
Report from page 112.
Further information on risk
management and controls
Global Compliance and GIA
Through our compliance programme and
three lines of defence risk management
framework (line management; Risk and
Compliance functions; GIA), Global
Compliance helps the Group achieve its
priorities and do business the right way.
It takes a global approach that addresses
key risk areas, including those related to
third parties and anti-bribery/anti-
corruption. Its work helps us to reinforce
compliant behaviours through our Code of
Ethics, policies, training, advice and
guidance. We also conduct risk assessment
activities and foster a culture where
individuals can raise concerns.
We take alleged compliance breaches and
concerns seriously. We investigate and take
appropriate disciplinary and remediation
action to address and prevent reoccurrence
through internal functions and external
advisers. Depending on breach severity,
the Group may need to disclose and/or
report the incident to a regulatory or
government authority.
Global Compliance provides assurance
insights to the Audit Committee on
compliance matters. GIA carries out a range
of audits and periodically reviews the
assurance activities of other Group functions.
The results from these activities are reported
to the Audit Committee. Global Compliance
and GIA share outcomes and coordinate
reporting on compliance matters throughout
the organisation. GIA is established by the
Audit Committee on behalf of the Board and
acts as an independent and objective
assurance function guided by a philosophy
of adding value to improve the operational
control framework of the Group. The scope
of GIA’s responsibilities encompasses, but is
not limited to, the examination and evaluation
of the adequacy and effectiveness of the
Group’s governance, risk management and
internal control processes in relation to the
Group’s defined goals and objectives.
Among others, internal control objectives
considered by GIA include:
•
Compliance with significant policies,
plans, procedures, laws and regulations.
•
Consistency of operations or programmes
with established objectives and goals,
and effective performance.
•
Safeguarding of assets.
Based on its activity, GIA is responsible for
reporting significant risk exposures and
control issues identified to the Board and to
senior management, including fraud risks,
governance issues and other matters
needed or requested by the Audit
Committee. It may also evaluate specific
operations at the request of the Audit
Committee or management, as appropriate.
control processes (incorporating financial,
operational and compliance controls) and
findings from assurance processes.
The Directors believe that the Group
maintains an effective, embedded system
of internal controls and complies with the
FRC’s guidance entitled ‘Guidance on Risk
Management, Internal Control and Related
Financial and Business Reporting’.
5. Remuneration
P. Remuneration policies and practices
The Remuneration Committee is responsible
for determining, approving and reviewing
the Company’s global remuneration
principles and frameworks, to ensure that
they support the strategy of the Company
and are designed to promote long-term
sustainable success.
Q. Developing executive
remuneration policy
The Remuneration Committee routinely
reviews the Directors’ Remuneration Policy
and executive remuneration arrangements
to ensure they continue to promote the
delivery of the long-term strategy and
support the Company’s ability to recruit and
retain executive talent to deliver against that
strategy. The Committee also considers
remuneration arrangements in the context
of corporate governance best practice and
arrangements for the wider workforce, and
regularly consults with its major investors
on remuneration proposals. No Director
is involved in determining their own
remuneration arrangements or outcomes.
R. Remuneration outcomes and
independent judgement
To ensure it maintains independent
judgement when determining remuneration
outcomes, the Remuneration Committee
considers a range of data, including detailed
business and individual performance
information, and also consults with other
Board Committees to utilise their expertise
when determining performance outcomes.
Further information on Directors’
independence
In December 2024, the Board considered
the independence of the Non-Executive
Directors, other than the Chair of the Board,
for the purposes of the Code and the Nasdaq
Listing Rules. Taking into account the
recommendations set out in the Code and the
Nasdaq Listing Rules, the Board considers
that all the Non-Executive Directors except
Marcus Wallenberg, are independent. Marcus
Wallenberg was appointed as a Director of
Astra in May 1989 and subsequently became
a Director of the Company in 1999. He is a
Non-Executive Director of Investor AB, which
has a 3.33% interest in the issued share
capital of the Company as at 31 January
2025. For these reasons – his overall length
of tenure and relationship with a significant
For more information on the
work of the Remuneration
Committee see from page 112.
Corporate Governance
Additional Information
Financial Statements
Strategic Report
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Patients and patient networks
Payers
Investor community
Overview
Significance
of the stakeholder
to the business
Patients are at the heart of what we do.
Our stakeholders include individual
patients, caregivers and patient
advocacy organisations. We listen to
their experiences, embedding these
insights into every aspect of our work,
and partner with them to enable access
to high quality, resilient healthcare
systems, ensuring that the medicines
and services we develop have the
greatest impact on their lives.
AstraZeneca works closely with payers,
which includes governments and medical
insurance companies among others,
to understand the impact of pricing
medicines on public and private budgets.
The Board and management maintain
regular and constructive dialogue with
investors to communicate our strategy.
We provide objective information about
performance to enable investors to put
a fair value on the Company and ensure
our continued access to capital.
Interests
Issues and factors
which are most
important to the
stakeholder group
•
Diverse insights gathered and
incorporated throughout the drug
development process to minimise
patient burden and measure outcomes
they care about most.
•
Ensuring healthcare systems are
designed and delivered with the patient
in mind.
•
Providing transparent, accessible
information.
•
Ensuring the safety, efficacy and
affordable accessibility of our medicines.
•
Sustainable access to safe and
effective innovative medicines.
•
Pricing of medicines, including
breakthrough therapies and impact
on public budgets.
•
Containing reimbursement expenditure.
•
Attracting business investment.
•
Investing in research and
scientific collaborations.
•
Financial and commercial performance.
•
R&D strategy, resource allocation and
pipeline development.
•
Culture, values and behaviours.
•
Exposure to geopolitical and
macroeconomic risks.
•
ESG matters.
Engagement
Examples of
engagement in 2024
•
Increased number of diverse
patient engagements throughout
drug development.
•
Involved patients and caregivers in
co-creation of multiple programmes.
•
Expanded patient support and
affordability programmes.
•
Collaborated with patient advocacy
organisations on key healthcare system
transformation projects, enabling
access to improved healthcare and
medicines across the globe.
•
Engaged governments and
policymakers to increase
understanding of the AstraZeneca
business model, to support investment
in life sciences and to improve access
to new medicines.
•
Engaged in discussions on evolving
the current reimbursement system for
medicines in the US.
•
Hosted site visits and tours at our
manufacturing and R&D facilities for
international and local politicians.
•
Ongoing communications including
quarterly results calls, in-person and
virtual meetings and roadshows.
•
Investor Day held in May 2024, set out
new strategic ambitions.
•
Regular events, including
presentation of Health Equity strategy
in November 2024.
•
Receptions hosted by the Chair of
the Board.
Outcomes
Actions which
resulted
•
Delivery of impactful and actionable
insight to drive patient-focused drug
development.
•
Increased patient support programmes
across therapy areas.
•
Driven global consensus and
supported the community to
strengthen national healthcare
systems.
•
Established working relationships
with key government stakeholders.
•
Regular meetings and events
organised to increase understanding
about how governments can better
support life sciences investment
and improve patient access to
new medicines.
•
Maintained access to senior and
next-level/operational management,
including increased virtual
engagement.
•
Continued to streamline external-
facing materials to provide increased
transparency, following discussion
with shareholders.
•
Increased focus on ESG matters
within results announcements and
shareholder engagements.
Considering the interests of our stakeholders is
fundamental to our Group’s strategy. The following
table identifies our most strategically significant
stakeholders and summarises the engagement that
has been undertaken by management during 2024.
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Healthcare professionals
Academic and R&D partners
Commercial collaborators and partners
Overview
Significance
of the stakeholder
to the business
Healthcare professionals (HCPs) are
the interface with patients. They provide
insights into clinical trial design and
prescribing, advising patients on
administering medicines, providing safety
reports, collaborating in clinical studies
and assisting with the ethical and
transparent distribution of medicines.
We collaborate with academic institutions
and non-profit R&D partners globally to
access the best science, to stimulate
innovation and to deliver life-changing
medicines to patients.
Partnering is an increasingly important
part of our business. By combining
forces, AstraZeneca and our partners
can accelerate innovative science to
bring life-changing medicines to patients.
Interests
Issues and factors
which are most
important to the
stakeholder group
•
Development of medicines for unmet
medical need.
•
Education and information on
advances in medical science.
•
Accurate and balanced information
on licensed medicines, including
up-to-date safety data.
•
Uninterrupted supply of
quality medicines.
•
Ethical and transparent interactions
with industry.
AstraZeneca had more than 1,500 active
academic collaborations during 2024:
•
To advance innovative technology
and science.
•
To address key scientific challenges.
•
To access the next generation of
science leaders.
•
Shared vision and values.
•
Development of innovative medicines
and improving access to them.
•
Trust and transparency in research,
disclosures and relationships
with stakeholders.
•
Willingness to collaborate with
industry peers to optimise outcomes
for common stakeholders, e.g.
patients, physicians, policymakers
and healthcare systems.
Engagement
Examples of
engagement in 2024
•
Engaged in HCP educational events,
advisory boards and in clinical trials.
•
Responded to more than 171,000 HCP
enquiries and processed adverse
event reports from HCPs which
contribute to the understanding of
the safety profile of our medicines.
•
We support more than 900 early career
positions in R&D globally, including
apprentices, graduates, placement
students, sponsored PhDs, postdoctoral
researchers and clinical fellows.
•
Through our Open Innovation
programme, we openly share molecules,
data and scientific expertise with
academic researchers and start-ups;
we currently have two ongoing clinical
trials, over 100 preclinical studies and
collaborative research projects, and over
20 public-private partnership projects
aimed at addressing key scientific
challenges under this programme.
•
Joint seminars, education sessions
and consortia with research institutions,
e.g. Royal Society Conference on
Gene Editing Medicines, Partners of
Choice Network.
•
Regular alliance leadership meetings
established to enhance collaboration
and create a ‘One Team’ mentality
across organisations.
•
Joint responsibility for deliverables and
outcomes across functions at all levels.
•
Multiple discussions with regulators,
policy makers, patient groups and
clinicians, to inform development and
commercial strategy to best meet
patient needs.
Outcomes
Actions which
resulted
•
Advisory boards informed clinical
research and product strategy.
•
Clinical studies have led to new products.
•
Exchange of information supported HCP
clinical decision making.
•
Enabled new technologies, new
target identification and validation,
and new biomarkers.
• Publications.
•
Capability to offer apprenticeship,
studentship, postgraduate and
postdoctoral programmes to facilitate
scientific discovery.
•
Optimisation of outcomes through
combined skillsets and use of
technologies/platforms to research
new medicines, enabling faster
delivery of medicines to patients.
•
Multiple late-stage trials initiated
across multiple disease/patient types.
•
Accelerated launch of new medicines
in unique areas.
•
Greater collaboration and
relationships with industry partners
and stakeholders.
Corporate Governance
Additional Information
Financial Statements
Strategic Report
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How the Board engages with stakeholders
For more information on how
management and the Board
have considered Modern
Slavery, see the Audit
Committee Report from
page 104, Human Rights on
page 48 and AstraZeneca’s
Modern Slavery Act Statement,
which is available on our
website, www.astrazeneca.com.
Community
We believe that creating a positive impact
for people, society and the planet requires
meaningful investments in the communities
where we live and work, with a focus on the
underserved. Our Community Investment
activities support non-profit organisations
all over the world to advance health equity,
increase access to care, drive science
innovation and build healthy and resilient
communities for all.
Workforce
Successfully attracting, retaining and
developing a talented and diverse
workforce is critical to achieving our
Ambition 2030. Our employees are a key
part of our strategy and we are committed
to being a great place to work. More
information is included on pages 48 to 50.
In addition to the principal stakeholders described on pages 94 and 95, the Board considers the following stakeholder groups important for
the business operations and strategic direction of the Company.
Health authorities
We engage regulators globally about the
manufacture, development, review,
approval and marketing of our products.
Governments
AstraZeneca partners closely with
governments around the world to promote
health, support healthcare research and
innovation, facilitate equitable access to
innovative care solutions, and build resilient
and sustainable healthcare systems.
Multilateral and non-governmental
organisations
AstraZeneca partners with multilateral
organisations and non-governmental
organisations (NGOs) to deliver meaningful
progress to advance health equity and
support the United Nations Sustainable
Development Goals. AstraZeneca’s
commitment is demonstrated through
science-based health programming and
disaster relief efforts that prioritise the
needs of the underserved.
Media
An active and constructive relationship
with the media is important to build trust
with the Company’s key stakeholders by
transparently reporting on the Group’s
activities, including the results of key trials
and business updates, as well as seeking
to enhance and protect the reputation of
the organisation.
Suppliers and third-party providers
We work with a broad range of third-party
suppliers to provide the goods and services
needed to deliver life-changing medicines
to patients globally. Our Procurement
function operates efficiently and effectively
to drive collaboration with those third-
parties, fostering innovative, ethical and
sustainable ways of working across the
entire supply chain.
The stakeholder table on pages 94 and 95
sets out management’s main interactions
with certain key stakeholders. Feedback
from these interactions is provided to the
Board in a variety of ways, which allows the
Board to understand the key interests of
stakeholders and consider them in its
decision-making process.
The Board undertakes additional direct
engagement with stakeholders to better
understand their interests and concerns,
so these can be factored into its
decision making.
Examples of the Board’s engagement are
set out in the following columns. Information
on how stakeholders and other factors were
considered in the Board’s principal
decisions in 2024 is set out on the
following page.
Full Board/Other
•
During 2024, a number of Directors,
including the CEO and the CFO, met
investors at roadshows and in one-on-one
meetings. The Chair conducted a series
of governance meetings with
major shareholders in the UK, Germany
and Sweden.
•
The 2024 AGM was digitally-enabled
and broadcast live, which allowed the
Company’s geographically diverse
shareholder base to participate in the
meeting and engage with the Board. The
digitally-enabled format allowed Directors
and shareholders to join from locations
across the globe.
•
Investor reports and financial analysts’
consensus data are made available to the
Board. Feedback is regularly provided to
the Board by management on their
interactions with investors.
•
The CEO and the CFO, along with
other members of management, met
governmental agencies and regulators
to discuss matters including the pricing
of medicines and equitable access.
•
The CEO and other members of
management attended a number of
scientific conferences in 2024, relevant
to the Company’s main areas of R&D and
Commercial activity.
•
During the World Economic Forum in
Davos, the Chair and senior leaders met
with 25 governments, and held seven
media interviews and seven speaking
engagements, highlighting the need to
advance the sustainable transformation
of health systems.
•
The Chair attended two plenary sessions
of the European Round Table of Industry
(ERT), where he engaged high-level
officials from the EU, Spain and Switzerland
on strengthening European economic
competitiveness and building more resilient
and sustainable health systems.
•
The CEO, CFO and the Chair, regularly
engaged with employees through
in-person and online events, including
‘townhalls’ and ‘fireside chat’ sessions.
Employees had the opportunity to ask
questions in advance or during sessions.
•
The Board held one of its scheduled
meetings during 2024 at AstraZeneca’s
R&D site in Gothenburg, Sweden. During
the meeting, the Board met employees,
including scientists and commercial
teams, and hosted a ‘townhall’ meeting.
The Board also met external stakeholders,
including Swedish government officials,
academics, scientists and university
health partners through a series of
meetings and roundtable discussions.
Alongside a scheduled Board meeting in
Cambridge, UK, the Board hosted select
employees for a lunch and a dinner.
•
The Committees of the Board also engage
with employees and other stakeholders
on matters within their areas of
responsibility. For further information
on Board Committees’ engagement
activities, see:
–
Science Committee Report on page 102
–
Sustainability Committee Report on
page 103
–
Audit Committee Report on page 107
–
Directors’ Remuneration Report from
page 112.
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Corporate Governance Report
| Connecting with our stakeholders
continued
2024 Group funding plan
In February 2024, the Board reviewed and
approved the Group’s funding plan for 2024.
Later, in July 2024, the Board considered an
update to the 2024 funding plan.
The Board considered:
investors; the
long-term success of the Company;
and maintaining high standards of
business conduct.
How the Board had regard to
these matters:
•
Reviewed the expected funding
requirements for the year ahead as well
as the mid- and long-term funding and
liquidity prospects.
•
Discussed the Group’s capital allocation
priorities, the long-term strategy and the
measures required to deliver the strategy,
including investment in the pipeline and
potential external acquisitions to further
strengthen the pipeline. The Board
considered the benefit of these
investments for patients and investors,
alongside the potential impact of
acquiring debt.
•
Considered the Group’s liquidity position
and the expectations of investors
regarding the progressive dividend policy.
Acquisitions to strengthen the pipeline
During 2024, the Board considered, and
approved, a number of acquisitions to
strengthen the Group’s pipeline and
accelerate the development of potentially
life-changing medicines. These included
the acquisition of Amolyt Pharma SAS and
Fusion Pharmaceuticals Inc.
The Board considered:
investors; patients;
the long-term success of the Company;
and maintaining high standards of
business conduct.
How the Board had regard to
these matters:
•
Reviewed the unmet medical need and
considered how the acquisitions would
further strengthen the Group’s pipeline.
•
Considered the benefits to patients if
the Group was able to accelerate the
development of novel treatments, which
could potentially deepen clinical
responses and improve patient outcomes.
•
Considered the Ambition 2030, and the
importance of new technologies (such as
next-generation radioconjugates) to
delivering the Ambition 2030.
•
Considered the financial impact of the
acquisitions on the Group’s viability and
capital allocation priorities, alongside the
financial benefits from the acquisitions if
the technologies were successful.
Annual strategy review and
Long-Term Plan
In July 2024, the Board reviewed and
approved the Company’s strategy and the
2024 Long-Term Plan (2024 LTP). Later in
December 2024, the Board approved the
mid-term plan and capital expenditure
for 2025.
The Board considered:
investors;
employees; the long-term success of the
Company; and maintaining high standards
of business conduct.
How the Board had regard for
these matters:
•
Considered the Group’s Purpose, to push
the boundaries of science to deliver
life-changing medicines to patients, and
how the Company’s strategy and the
2024 LTP align with this Purpose.
•
Evaluated how the strategy would foster
innovation and enhance the Company’s
competitive position.
•
Considered how the strategy and 2024
LTP would impact current, and future,
employees and the level of resourcing
needed to deliver the Company’s
ambitious strategy.
•
Reviewed and challenged the
assumptions within the 2024 LTP.
•
Considered investor expectations and
analysts’ consensus, and how these
aligned to the 2024 LTP.
2024 Group budget
In February 2024, the Board reviewed and
approved the Group’s 2024 budget.
The Board considered:
investors;
employees; and the long-term success
of the Company.
How the Board had regard to
these matters:
•
Discussed the Group’s long-term plan,
strategic goals and priorities, as well as the
stretching Ambition 2030, and reviewed
how the 2024 budget supported the
delivery of these long- and mid-term plans.
•
Considered consensus expectations, the
anticipated challenges and opportunities,
and provided challenge to ensure that
the 2024 budget was appropriate as well
as stretching.
•
Reviewed the assumptions that
underpinned the budget and considered
the resources that would be needed to
deliver the budget, including how
employees would be impacted, the
number of launches that would be
needed and the medicines that would be
delivered to patients.
•
Reviewed the Group’s capital allocation
priorities and whether the 2024 Group
budget supported the delivery of
these priorities.
Dividends
During 2024, the Board approved the 2023
second interim dividend (paid in March 2024),
the 2024 first interim dividend (paid in
September 2024) and also established a
Board committee to decide the Board’s
intended approach to dividends to be
declared in relation to the 2024 financial year.
The Board considered:
investors; the
long-term success of the Company;
and maintaining high standards of
business conduct.
How the Board had regard for
these matters:
•
Reviewed the Group’s distributable
reserves and financial performance for
the period, to ensure that the Company
was in a good position to increase and
pay a dividend.
•
Considered the progressive dividend
policy, capital allocation priorities and
investor expectations as to the expected
level of dividend.
•
Weighed the investor expectations,
alongside the 2024 Group budget, as well
as the mid- and long-term plans, and the
level of investment that was required by
the Company to deliver these.
Set out below are examples of how key stakeholders, Section 172(1) of the Companies Act 2006 duties and other matters are considered by
the Board when making its Principal Decisions in 2024.
Principal Decisions in 2024
For the Section 172(1)
statement, see page 63.
For more information, on the:
Dividends, see Note 25 to
the Financial Statement from
page 192.
Funding, see Note 28 to the
Financial Statement from
page 194.
Acquisitions and
collaborations, see Business
development from page 46.
Group‘s Growth Through
Innovation strategy and our
Ambition 2030, see Our
Strategy and Key Performance
Indicators from page 12, and
for how we are delivering our
strategy, see our Business
Review from page 32.
Committees’ composition and
succession planning, see the
Nomination and Governance
Committee Report from
page 100.
Corporate Governance
Additional Information
Financial Statements
Strategic Report
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Corporate Governance Report | Principal Decisions
Corporate Governance Report
| Principal Decisions
Engaging with our workforce
AstraZeneca is committed to being a
great place to work. Engagement with
our employees and wider workforce is
an important element in ensuring an
environment in which everyone is
respected, where openness is valued,
diversity celebrated and every voice heard.
We rely on our global workforce to uphold
our Values, deliver our strategic priorities
and work to sustain and improve short- and
long-term performance. For AstraZeneca,
‘global workforce’ includes our full-time and
part-time employees, fixed-term workers
and external contractors working full- or
part-time, anywhere in the world.
The Directors believe that the Board as a
whole should be responsible for engaging
with and understanding the views of the
workforce. Consequently, the Board has
chosen not to implement any of the three
methods set out in the Code. Instead, it uses
various mechanisms and long-standing
communication channels in place across the
Group that enable and facilitate engagement
with the global workforce. These include
the Board’s review of the global workforce
Pulse survey and the biannual Workforce
Culture and Employee Engagement Report;
Board members hosting ‘townhall’ meetings
for the workforce, including ‘fireside chats’
and Q&A sessions; and review of data
relating to talent, development, inclusion
and diversity initiatives, and internal
engagement channels. Directors also visit
our sites and carry out virtual engagements,
which facilitate understanding of business
operations and also provide opportunities
for interactions between Directors and the
workforce, including engagement with
high-potential employees. Where required,
issues or concerns raised by the workforce
are fed back to management and discussed
by the Board.
To maximise reach across the global
workforce and ensure engagements take
place with the many different role types that
exist, individual Directors, as well as Board
and Board Committees, also host virtual
engagements to hear and understand
their views.
The Board believes that the holistic
approaches deployed provides
comprehensive access to the views of
the workforce regardless of location and
provides meaningful information and data
that the Board can use when considering the
impact of strategic decisions on employees.
Workforce culture
During 2024, the Board reviewed the
biannual Workforce Culture and Employee
Engagement Report, which demonstrated
how our Values and behaviours are
embedded throughout all levels of the
workforce. The report contains a summary
metric dashboard which is divided into
categories reflecting AstraZeneca’s Values
and behaviours. Where the Board has
concerns that the culture does not reflect
our Values, the Board seeks assurances
from management that remedial action has
been taken and, where necessary, requests
senior management’s attendance at Board
meetings to discuss corrective actions.
>84,400
employees took part in the November 2024
Pulse survey.
‘Townhall’ meetings and ‘fireside chats’
Both Non-Executive Directors and Executive
Directors regularly participate in meetings
with sites, or large groups of the workforce
– either virtually or in person. These enable
direct engagement between the Board and
employees, including Q&A sessions, such as
the Chair’s ‘fireside chats’. During the year,
among other events, Board members hosted
in-person ‘townhall’ meetings for employees
at the Company’s sites in Canada,
Switzerland, Spain and Sweden, which were
also broadcast to other sites in those regions
to increase reach and participation.
Employee opinion survey (Pulse)
Each year, employees are invited to take part
in an opinion survey, which seeks their views
of the business. The results are reviewed by
management and trends are monitored.
The results are shared with the Board,
which enables the Directors to understand
the views and sentiments of the workforce.
87%
of employees stated they believe strongly
in AstraZeneca’s future direction and key
priorities in the November 2024 Pulse
survey.
Site visits
During 2024, Directors visited various
Group sites across the world in person,
including those in Canada, Switzerland,
Spain, Sweden and the UK.
7
AstraZeneca Group sites around the world
were visited by Non-Executive Directors
during 2024.
Wellbeing
Where appropriate – for example in relation
to humanitarian events – the Board receives
regular updates on the steps taken by
management to create safe working
environments and support the mental and
physical wellbeing of the workforce.
•
Considered the Group’s capital allocation
priorities, progressive dividend policy
and funding plans and how these will be
impacted by the 2024 LTP.
•
Reviewed the capital expenditure plan
for 2025 and whether the proposed
investments will drive sustainable growth
and deliver value to the Company and
its stakeholders.
Appointment of Rene Haas and Birgit
Conix as Non-Executive Directors
In December 2024, the Board appointed
Rene Haas and Birgit Conix as Non-
Executive Directors with effect from
1 January 2025 and 1 February 2025
respectively. Birgit joined the Audit
Committee upon her appointment.
The Board considered:
investors; the
long-term success of the Company;
and maintaining high standards of
business conduct.
How the Board had regard for
these matters:
•
Considered the Board’s diversity, time
commitments of the candidates and
other relevant governance considerations,
including UK Corporate Governance
Code provisions, as well as Board and
Board Committee succession
planning considerations.
•
Assessed the skill composition of
its Committees and reviewed the
requirements for each Committee to
ensure that newly appointed Directors
possess the necessary skills to succeed
Directors approaching retirement.
•
Reviewed the experience of potential
candidates and met those who were
shortlisted to evaluate which individuals
had the skills required to support
management in the continued delivery
of value to shareholders and life-
changing medicines to patients, while
also maintaining high standards of
business conduct.
•
Considered the independence of
Non-Executive Directors by assessing
candidates’ potential conflicts of interest
and affiliations to maintain objectivity and
unbiased judgement in Board deliberations.
•
Considered changes to the wider
business environment, such as the
increasing importance of technology and
AI, and changes in modalities, and what
skills the Board needed to ensure that it
could provide appropriate oversight to
help the Company continue to grow in
such an environment.
•
Considered whether the selected
Non-Executive Directors have the skills
necessary to contribute to the Company’s
long-term strategy and assessed their
ability to challenge assumptions and
support sustainable growth.
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Corporate Governance Report
| Principal Decisions
continued
2024 overview
An externally-facilitated evaluation of
the performance of the Board and its
Committees was conducted during 2024
by Christopher Saul Associates (CSA),
an independent, external corporate
governance advisory firm. CSA was
selected following a review of potential
firms by the Chair and in consultation with
the senior independent Non-Executive
Director and has no other commercial
relationship with the Company or any
individual Directors.
As noted in the 2023 Annual Report, under
the UK Corporate Governance Code, the
Company was due to have an externally-
facilitated evaluation in 2023, which the
Board elected to postpone until 2024 in
light of the change in Chair during 2023.
The Board concluded that it would be a
better use of time and resources for the next
externally-facilitated annual performance
evaluation to take place in 2024, so that at
least the first 12 to 18 months of the Board’s
work under the new Chair could be taken
into account.
To obtain feedback on the effectiveness
of the Board and its Committees, CSA’s
evaluation included a structured one-on-
one interview process with Board members,
certain members of the SET, the VP, Group
Internal Audit and the lead audit
engagement partner of the Group’s auditor,
PwC. CSA also observed certain Board and
Board Committee meetings during June and
July 2024. CSA issued its final report on the
findings of the performance evaluation to
the Board in September 2024, which was
discussed by the Board at its meetings in
September and November 2024, and at
Board Committee meetings thereafter.
The initial Board discussion was facilitated
by CSA.
As part of each Director’s individual
discussion with the Chair during each year,
his or her contribution to the work of the
Board and personal development needs are
considered. Directors’ training needs are
met by a combination of: internal
presentations and updates, and external
speaker presentations, as part of Board and
Board Committee meetings; specific
training sessions on particular topics, where
required; and the opportunity for Directors
to attend external courses at the Company’s
expense, should they wish to do so.
The Nomination and Governance
Committee also reviews the composition
of the Board to ensure that it has the
appropriate expertise, while also
recognising the importance of diversity.
For more information on the Nomination and
Governance Committee’s work, see the
Nomination and Governance Committee
Report from page 100.
2024 outcomes and actions against
prior year recommendations
The key conclusions were:
•
The Board continues to operate
effectively. It is collegiate and well-led,
it operates to high standards of
professionalism and benefits from
good-quality support.
•
All of the Board’s Committees work hard
and effectively and are well-integrated
into overall Board processes.
•
The relationship between the Board and
the SET is respectful and constructive
and the Chair transition from Leif
Johansson to Michel Demaré has
developed well.
•
Key priorities for 2025 include
succession planning, the continuous
improvement of agendas, papers and
meeting processes and continued focus
on AI strategy.
To address areas highlighted by the
2023 annual Board performance
evaluation, various steps were taken
during 2024, including:
•
The provision of greater detail to the
Board about the work of the Nomination
and Governance Committee, including
routine Executive Director succession
planning and Non-Executive Director
succession planning with a focus on
those Non-Executive Directors due to
reach nine years’ tenure in 2026.
•
Arranging briefing sessions for the
Board on geopolitical risk, the wider
pharmaceutical landscape and investor
perspectives on the Company and the
pharmaceutical sector.
•
Enhancing the content of the Board’s
annual strategy review days to provide
more in-depth focus on incremental or
newer areas of the business, more
competitive analysis, and increased
review of strategic trends.
As part of the Board performance
evaluation, Directors were asked to
consider the following areas:
• Board dynamics
• Succession
• Agendas and papers
• Board meetings
• Board Committees
• Senior Executive Team and Board
• Business understanding
• Engagement with stakeholders
• Areas for focus
Corporate Governance
Additional Information
Financial Statements
Strategic Report
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Corporate Governance Report | Board performance evaluation
Corporate Governance Report
| Board performance evaluation
“The Nomination and Governance
Committee works on behalf of the
full Board to review the composition
of the Board and its Committees
and carry out succession planning
for all Board positions.”
Nomination and
Governance Committee
members
• Michel Demaré (Chair)
• Euan Ashley
• Philip Broadley
• Sheri McCoy
• Nazneen Rahman
The full role of the Nomination
and Governance Committee is
set out in its terms of reference,
available at
www.astrazeneca.com.
For more information on each
Director’s individual experience
in these areas, see the Board
biographies on pages 88
and 89.
Non-Executive Directors’ experience, as at 1 February 2025
Skills and experience
Total
Business
Finance
Experience in accounting, corporate finance, internal controls and associated risk management.
7
Management
Experience working in senior management roles of major companies, business transformation
and strategy.
9
Sales and marketing
Understanding and experience in sales and marketing.
4
Technology, digital and AI
Knowledge and experience in technology, biotechnology, AI and digital health tools.
6
Sustainability
Experience in managing the issues and opportunities associated with business sustainability,
including corporate social performance, stakeholder engagement, and science-based solutions.
5
Geographic
The regions where the Non-Executive Directors are primarily based.
UK
3
US
4
Europe
5
Asia
1
Industry-specific
Science
Practical knowledge and experience in scientific research, development and innovation.
7
Pre-AstraZeneca pharma
Professional experience in the pharmaceutical industry prior to joining AstraZeneca.
8
Medical doctor/physician
Clinically trained medical doctor and/or physician.
3
Committee’s role
The Committee works on behalf of the full
Board to review the composition of the
Board and its Committees and carry out
succession planning for all Board positions,
including taking the lead in the search for
and recruitment of new Directors. The
Committee ensures the Board has an
appropriate balance of expertise,
experience and diversity. A matrix that
records the skills and experience of current
Board members is one of the main tools
used by the Committee to do this. The
matrix is shown in the table above.
Decisions relating to the appointment of
Directors are made by the entire Board based
on the Committee’s recommendations,
taking into account the merits of the
candidates and the relevance of their
background and experience, measured
against objective criteria, with care taken
to ensure appointees have enough time
to devote to the Board’s business.
Board and Board Committee
composition and succession planning
The Committee considers both planned and
unplanned (unanticipated) succession
scenarios. The Committee spent the majority
of its time in 2024 on succession planning for
Non-Executive Directors, successfully
concluding the appointment of Rene Haas
and Birgit Conix as Non-Executive Directors
with effect from 1 January 2025 and
1 February 2025 respectively. Birgit became
a member of the Audit Committee on
appointment. The search process was led by
the Committee and involved Rene and Birgit
meeting with multiple Directors. Rene brings
deep and broad knowledge of technology
including data science, computing and AI
from his experience in the microprocessor,
semiconductor and software engineering
industry, and experience of leading a large
Cambridge, UK-based technology company.
Birgit brings significant financial and executive
experience through successive CFO roles
over the last decade and 15 years’ prior
experience of the pharmaceutical industry.
The Committee also continued routine
succession planning work for the role of CEO,
which as in previous years included desktop
research relating to potential external
candidates and continued monitoring of the
development of potential internal candidates.
Board and Technology, Coulter Partners,
Heidrick & Struggles, Korn Ferry and Lygon
Group assisted the Committee with its
succession planning and non-executive
search work this year. Board and Technology,
Coulter Partners, Heidrick & Struggles, and
Lygon Group undertake executive search
assignments for the Company, and Korn Ferry
On behalf of the Nomination and
Governance Committee (the Committee),
I am pleased to present the Committee’s
report on its activities during 2024.
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Nomination and Governance Committee Report
As well as being considered in decisions
about succession and Board appointments,
inclusion and diversity is integrated across
our Code of Ethics and associated workforce
policy for the organisation as a whole.
We were named first ranking healthcare
company in the FTSE 100 for women on
boards and in leadership in the FTSE
Women Leaders Review. For the year ended
31 December 2024, women represented
50% of the SET and its leadership teams.
Ongoing training and development
Following their appointment, Rene and Birgit
commenced tailored induction programmes
to provide an understanding of the Group,
reflecting their existing expertise and
Committee membership.
In addition to arranging comprehensive
induction programmes when new Non-
Executive Directors are appointed to the
Board, the Committee recognises the
importance of continuing development and
training opportunities for all Directors. We are
committed to developing a culture of lifelong
learning throughout our organisation.
Specific sessions with internal and external
experts are periodically arranged for the full
Board, to ensure that Directors have access
to specialist knowledge across a broad range
of areas to support their strategic decision
making. For example, this year the Board had
sessions with external experts on
geopolitical risk, the wider pharmaceutical
landscape and investor perspectives on the
Company and the pharmaceutical sector.
At least annually, I discuss with each Director
their contribution to the work of the Board
and personal development needs. Directors’
training needs are met by: a combination
of internal presentations and updates, and
external speaker presentations, as part of
Board and Board Committee meetings;
specific training sessions on particular
topics, where required; and the opportunity
for Directors to attend external courses at the
Company’s expense, should they wish to
do so. Directors are encouraged to visit the
Group’s sites, providing opportunities to
meet local employees and tour AstraZeneca
facilities. Virtual visits are also arranged to
allow further interactions with employees
and sites. These visits further Directors’
understanding of the Group’s business and
operations, as well as provide an insight into
the particular challenges faced locally and
opportunities to engage directly with
employees and other stakeholders.
Corporate governance
The Committee advises the Board
periodically on significant developments in
corporate governance and the Company’s
compliance with the UK Corporate
Governance Code. Further information on
our corporate governance arrangements,
including the Company’s statement of
compliance with the Code during the year,
is set out from page 91.
Michel Demaré
Chair of the Nomination and
Governance Committee
undertakes executive search assignments
and other recruitment-related activities for
the Company. The five firms used for
succession planning work during the year
have no other connection with AstraZeneca
or its individual Directors.
Inclusion and diversity
The Board views all aspects of diversity
among Board members as important
considerations when reviewing its
composition. The Board aims to maintain a
balance in terms of the range of experience
and skills of individual Board members,
which includes relevant international
business, pharmaceutical industry,
sustainability, and financial experience,
and appropriate scientific and regulatory
knowledge. The biographies of current
Directors are set out on pages 88 and 89.
The Board’s Inclusion and Diversity Policy
(the Policy), which is applicable to the Board
and its Committees, reinforces the Board’s
ongoing commitment to all aspects of
diversity and to fostering an inclusive
environment in which each Director feels
valued and respected. Although the Board
appoints candidates using objective criteria,
primarily based on merit and relevant
experience, it recognises that an effective
Board requires diversity. To help recruit
Directors from a broad, qualified group of
candidates, the Policy requires the use of
at least one professional search firm that
has signed up to the ‘Voluntary Code of
Conduct for Executive Search Firms’, which
the Company has complied with in 2024.
The Board’s approach to inclusion and
diversity continues to yield successful
results, as shown in the following tables.
The information presented in the tables
was collected on a self-reporting basis.
The Board, SET and Company Secretary
were provided with the prescribed table,
and asked to complete it based on how they
identify. As at 31 December 2024, the Board
is pleased that the Company met the
updated diversity policy targets as specified
in the FCA’s April 2022 Policy Statement on
‘Diversity and inclusion on company boards
and executive management’:
•
46% of the Board (and 45% of Non-
Executive Directors) were women,
above the target of at least 40%.
•
The Company met the policy target that at
least one of the Chair of the Board, Chief
Executive Officer, Senior independent
Non-Executive Director or Chief Financial
Officer be a woman.
•
31% of the Board identified as an ethnic
minority, above the target of at least one
Board member being from a non-white
ethnic minority background.
As at 6 February 2025, these targets
continue to be met, following the
appointment of Rene and Birgit.
The Board’s Inclusion and
Diversity Policy can be read
in full on our website,
www.astrazeneca.com.
Information about our approach
to diversity in the organisation
below Board level can be found
in People, from page 48.
Table 1. Reporting table on sex/gender representation as at 31 December 2024
Number
of Board
members
Percentage
of the Board
Number of
senior positions
on the Board
1
Number in
executive
management
Percentage
of executive
management
Men
7
54%
3
6
55%
Women
6
46%
1
5
45%
Non-binary
–
–
–
–
–
Not specified/prefer not to say
–
–
–
–
–
Table 2. Reporting table on ethnicity representation as at 31 December 2024
Number
of Board
members
Percentage
of the Board
Number of
senior positions
on the Board
1
Number in
executive
management
Percentage
of executive
management
White British or other White
(including minority-white groups)
9
69%
3
9
82%
Mixed/Multiple Ethnic Groups
1
8%
–
–
–
Asian/Asian British
3
23%
1
2
18%
Black/African/Caribbean/
Black British
–
–
–
–
–
Other ethnic group, including Arab
–
–
–
–
–
Not specified/prefer not to say
–
–
–
–
–
1
CEO, CFO, Senior independent Non-Executive Director and Chair.
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Activities during the year
The Committee met five times during 2024,
both virtually and face-to-face. This included
a two-day meeting at the AstraZeneca site
in Shanghai, China which provided a wealth
of opportunities to engage with R&D
employees. Committee members visited the
Gracell office, attended a poster session with
AstraZeneca scientists from China and
Japan, and had one-to-one meetings with
global R&D leaders. The Committee also
hosted a lunch with AstraZeneca scientists,
including rising stars nominated by functions,
received a presentation from two academic
researchers, and completed a lab tour and
visit with Eccogene.
Our key areas of focus during the
year included:
•
Company strategy and strategic
priorities for R&D:
including key prioritised
science platforms across R&D (Oncology,
BioPharmaceuticals and Rare Disease) and
areas of focus for long-term success,
including business development strategy.
•
AstraZeneca R&D strategic science
capabilities:
a deep dive on
immunotherapy across R&D including
vaccines, immune therapies and cell
therapies, as well as a focus on AI
capabilities and strategy and a deep dive
on chronic weight management targets
and mechanisms.
•
Acquisitions and in-licensing
agreements:
review for the Board the
scientific case for acquisition and
licensing opportunities, including:
–
Acquisition of Fusion Pharmaceuticals
Inc., a clinical-stage biopharmaceutical
company developing next-generation
radioconjugates.
–
Acquisition of Amolyt Pharma SAS,
which bolstered the Rare Disease
late-stage pipeline.
–
Exclusive licence agreement with
CSPC Pharmaceutical Group Ltd to
advance the development of an early
stage, novel small molecule Lipoprotein
(a) disruptor.
•
Regulatory affairs:
a review of regulatory
affairs focusing on trends shaping the
global regulatory affairs landscape
including new digital tools and country
level innovations.
•
R&D in China:
the Committee held an
in-person meeting at our R&D site in
Shanghai, China. This included visits
to Gracell and Eccogene and
presentations from AstraZeneca’s
local scientist employees.
•
Corporate scorecard outturn and goal
setting:
providing insight and feedback to
the Remuneration Committee in support
of 2024 achievements and 2025 goal
setting relating to R&D.
Euan Ashley
Chair of the Science Committee
Chair’s introduction
The Science Committee’s (the Committee)
core role is to provide assurance to the
Board regarding the quality, competitiveness
and integrity of the Group’s R&D activities.
We achieve this through dialogue with
AstraZeneca’s R&D leaders and other
scientist employees, as well as visits to
our R&D sites throughout the world.
Our role is to review and assess:
•
The approaches we adopt in respect
of our chosen therapy areas.
•
The scientific technology and R&D
capabilities we deploy.
•
The scientific strategy for maintaining
our pipeline and competitiveness.
•
The decision-making processes for R&D
projects and programmes.
•
The quality of our scientists, their career
opportunities and talent development.
•
Benchmarking against industry and
scientific best practice, where appropriate.
We also periodically review important
bioethical issues and assist in the formulation
of appropriate policies in relation to such
issues, agreeing these on behalf of the
Board. The Committee also considers future
trends in medical science and technology,
and reviews, on behalf of the Board,
the R&D aspects of specific business
development or acquisition proposals,
advising the Board on its conclusions.
Science Committee
members
• Euan Ashley (Chair)
•
Diana Layfield
• Tony Mok
• Nazneen Rahman
• Marcus Wallenberg
• EVP, Oncology
Haematology R&D
1
• EVP, BioPharmaceuticals
R&D
1
• CEO, Alexion
1
1
Co-opted member of the Committee.
The full role of the Science
Committee is set out in its
terms of reference, available
at www.astrazeneca.com.
“The Science Committee’s core
role is to provide assurance to
the Board regarding the quality,
competitiveness and integrity
of the Group’s R&D activities.”
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“The Sustainability Committee
continued its important work in
2024 to oversee the execution of
the Company’s sustainability
strategy.”
Virtual coffees were also arranged for
individual Committee members to meet
informally with small groups of employees
and learn more about implementation of
our sustainability strategy at local level.
This included site-specific projects lowering
carbon emissions and increasing water,
energy and waste efficiencies, AZ Forest
activities, and affordability and health
equity considerations as well as specific
programmes, such as Green Labs to
reduce the environmental impact of our
lab operations, and global community
investment initiatives, such as the Young
Health Programme.
Our focus areas during the year included:
•
The next-generation propellant transition
programme, as a component of achieving
AstraZeneca’s 2030 sustainability targets.
•
The progress of AZ Forest, including
consideration of the broader nature,
biodiversity and social impacts of
the programme.
•
A strengthened approach to the
governance and due diligence of
AstraZeneca’s product donations for
disaster relief, humanitarian relief and
public health need.
•
Trends in sustainability reporting and
the different regulations that will apply
to AstraZeneca, including the IFRS
Sustainability Disclosure Standards,
Corporate Sustainability Reporting
Directive (CSRD), European Sustainability
Reporting Standards and Corporate
Sustainability Due Diligence Directive.
•
The measures and processes under
implementation to enhance the
Company’s sustainability reporting,
covering data, processes, systems
and controls.
•
A double materiality assessment in line
with CSRD, and recommendation to the
Audit Committee of the material topics
identified and integrated into this
Annual Report.
•
Reviewing AstraZeneca’s sustainability
strategy framework.
•
Supporting the Remuneration Committee
in its consideration of how the delivery
of our ESG priorities is incentivised. This
included reviewing performance of the
sustainability metric, ‘Ambition Zero
Carbon’, in the 2022 LTI, which focused
on Scope 1 and 2 GHG emissions, and
reviewing the updated sustainability
metric and targets, which from 2025
will focus on value chain (Scope 3)
GHG emissions.
•
Overseeing engagement with investors
and other stakeholders on sustainability-
related matters and reviewing
AstraZeneca’s external disclosures in
collaboration with the Audit Committee.
Nazneen Rahman
Chair of the Sustainability Committee
Chair’s introduction
The Sustainability Committee (the
Committee) continued its important work
during 2024 to oversee the execution of
the Company’s sustainability strategy.
In addition to this important function,
the Committee’s other roles are:
•
To collaborate with the Audit Committee
to review the Company’s regulatory
disclosures relating to sustainability and
provide information and advice to support
the Board and Audit Committee in relation
to those disclosures, as required.
•
To oversee other communication
of our sustainability activities with
our stakeholders.
•
To monitor developments and best
practice and provide input to the Board
and other Board Committees on
sustainability matters as required.
•
To advise the Remuneration Committee
on the Company’s performance against
sustainability metrics and targets.
Committee meetings and other informal
interactions with employees allow
Committee members to engage closely
with those charged with executing our
sustainability strategy. This helps us
develop a deeper understanding of
sustainability initiatives, their progress,
who executes them, and how this is done,
to share with the wider Board.
Activities during the year
During 2024, the Committee met twice
formally. To enhance our understanding
of the sustainability initiatives in action at
AstraZeneca and hear colleagues’ personal
perspectives, the Committee invited
employees who were involved in
workstreams and projects from across our
sustainability strategy to its meetings.
Sustainability Committee
members
• Nazneen Rahman (Chair)
• Sheri McCoy
• Andreas Rummelt
• Marcus Wallenberg
Standing attendees at Committee
meetings during 2024 included the:
EVP, Global Operations, IT and the Chief
Sustainability Officer; and VP Global
Sustainability and SHE.
The full role of the
Sustainability Committee
is set out in its terms of
reference, available at
www.astrazeneca.com.
For more information about
sustainability at AstraZeneca,
visit www.astrazeneca.com/
sustainability.
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Sustainability Committee Report
Audit Committee members
• Philip Broadley (Chair)
• Deborah DiSanzo
• Sheri McCoy
• Anna Manz
• Birgit Conix
¹
1
Appointed as a member of the
Committee on 1 February 2025.
•
The planned upgrade of the Group’s
Enterprise Resource Planning IT systems
(Project Axial).
•
The impact on our operations of sanctions
on Russia and measures in place to ensure
ongoing compliance with applicable
sanctions regimes whilst ensuring patient
access to essential medicines.
•
Our IT/IS function and how we continue to
manage and mitigate cybersecurity threats.
•
Our Operations function, as we continue
to evolve our supply chain capabilities.
•
The prevention and detection of fraud
in clinical trials.
•
The investigations by Chinese authorities
into current and former AstraZeneca
employees regarding allegations of
medical insurance fraud, illegal drug
importation and personal information
breaches, and the receipt by the
Company of a Notice of Transfer to the
Prosecutor and an Appraisal Opinion
from the Shenzhen City Customs Office
regarding suspected unpaid importation
taxes. Committee members also
participated in Board briefings and
discussions on these topics.
These sessions allowed the Committee to
continue exploring specific aspects of risks
in their ‘real world’ business contexts, in direct
dialogue with people in the business that
have responsibility for managing these risks.
During the year, the Committee undertook
an external audit services tender process as
the current auditors, PwC, have been in role
since the financial year ended 31 December
2017. Following a rigorous process, the
Committee recommended, and the Board
endorsed, the appointment of KPMG as the
Group’s external auditor for the financial
year ending 31 December 2026. Provision of
assurance over sustainability reporting will
also transition to KPMG from the financial
year ending 31 December 2025. For details
on the tender process, see page 111.
The Committee also spent considerable
time continuing to keep ourselves updated
on developments in the reporting and
regulatory environment, particularly in
relation to sustainability-related reporting.
The Committee has also been updated on
preparations for upcoming changes to the UK
Corporate Governance Code, including the
requirement to review material controls under
Provision 29 which will require additional
disclosures and a Board declaration
regarding the effectiveness of these controls.
We continued our approach of a combination
of in-person and virtual Committee meetings
and interactions with colleagues from across
the organisation, including in-person visits
by Committee members to AstraZeneca’s
sites in Canada, Sweden and Switzerland,
details of which are provided on page 107.
These interactions, along with the in-depth
sessions I refer to above, have allowed
Committee members to maximise our
engagement with colleagues across the
business, deepen our understanding of the
priorities and challenges facing many different
markets and business areas, and hear a
wide range of employees’ views directly.
We also recently welcomed Birgit Conix as
a member of the Committee following her
appointment to the Board on 1 February 2025.
Birgit brings significant financial, executive and
pharmaceutical industry experience, which
will assist the Committee with its activities,
and we look forward to working with her.
We hope you find the Committee’s Report
useful and informative and, as ever,
I welcome any feedback.
Philip Broadley
Chair of the Audit Committee
Chair’s introduction
On behalf of the Audit Committee (the
Committee), I am pleased to present the
Committee’s report on its activities and the
significant matters it considered during 2024.
The Committee’s main responsibilities
include monitoring the integrity of financial
reporting and formal announcements
relating to financial performance, reviewing
the effectiveness of internal controls,
risk management and compliance systems
and processes, and overseeing the external
and internal audit processes.
The Committee believes that it has carried
out its responsibilities effectively throughout
the year, and to a high standard, providing
independent oversight. It has had good
support from AstraZeneca personnel and
PwC, the Company’s auditors.
The Committee continues to apply
appropriate challenge to the Company’s
management; for example, the valuation
and presentation of the
Andexxa
intangible
asset impairment, together with the
inventory and related contract provisions
as non-core items. This matter was subject
to robust discussions and scrutiny from
the Committee before it was satisfied with
management’s approach. The Committee
also closely monitored the revenue
recognition approach and control
environment in respect of major milestone
payments that are recognised as
Collaboration Revenue, in particular
Lynparza
sales in the context of the
$600 million sales-related milestone
receivable from Merck.
The Committee’s agenda continues to be
driven by the Company’s key active risks
and key strategic programmes which are
considered at every Committee meeting, and
inform the Committee’s agenda of in-depth
sessions which, this year, have included:
“The Committee’s main
responsibilities include monitoring
the integrity of financial reporting
and formal announcements
relating to financial performance,
reviewing the effectiveness of
internal controls, risk management
and compliance systems and
processes, and overseeing
the external and internal
audit processes.”
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Audit Committee Report
Activities during the year
Financial reporting
Effective internal controls, appropriate
accounting practices and policies, and
the exercise of experienced judgement
by the Committee and the Board underpin
AstraZeneca’s financial reporting integrity.
The Committee’s activities in this area in
2024 included:
•
Reviewing key elements of the Financial
Statements and the estimates and
judgements contained in the Group’s
financial disclosures, as well as
considering the appropriateness of
management’s and the external auditor’s
analysis and conclusions on judgemental
accounting matters. The significant
financial reporting issues considered are
described in detail in the table on pages
108 and 109. Further information on the
significant accounting matters considered
is included in the Financial Review under
Critical accounting policies and estimates
on page 82 and within our Group
Accounting Policies from page 152.
•
Considering the completeness and
accuracy of the Group’s reported financial
performance against its internal and
external key performance indicators
on a quarterly and annual basis.
•
Reviewing the preparation of the Directors’
Viability statement and considering the
adequacy of the analysis supporting the
assurance provided by that statement, as
well as the going concern assessment and
adoption of the going concern basis in
preparing this Annual Report and the
Financial Statements.
•
Reviewing quarterly updates from both
management and PwC on the programme
of activities relating to control over
financial reporting and the effectiveness
of testing that has been performed across
the internal control environment.
•
Considering the external auditor’s reports
on its audit of the Group Financial
Statements, as well as reports from
management, Global Compliance and
the external auditor on the effectiveness
of our system of internal controls and,
in particular, our internal control over
financial reporting. This included
consideration of compliance with
applicable provisions of the Sarbanes-
Oxley Act – in particular, the status of
compliance with the programme of
internal controls over financial reporting
implemented pursuant to section 404
of that Act.
•
Discussing financial reporting
considerations in relation to significant
transactions that occurred in the year
including the acquisitions of Fusion and
Amolyt Pharma, the amortisation and
impairment of intangible assets,
restructuring programmes and the
presentation of Alliance Revenue and
Collaboration Revenue.
•
Reviewing developments in sustainability
reporting requirements, the Company’s
sustainability reporting approach for
2024 and the double materiality
assessment as described in more detail
in the Sustainability reporting and
climate-related risk section on page 106.
•
Reviewing, with appropriate challenge,
the outcomes from the Group’s budgeting
and forecasting process for the near term,
including capital expenditure projections.
Risk identification and management
The Committee continued its regular
reviews of the Group’s approach to risk
management, the operation of its risk
reporting framework and risk mitigation.
This included consideration of the manner
in which the risk management process was
embedded in the Group such that the
Committee could be assured that
management’s accountability for risks
was clear and functioning effectively.
The Company’s risk framework, described
further from page 64, provides the context
for the Committee to consider the Directors’
Viability statement which is underpinned by
the assurance provided through a ‘stress
test’ analysis under which key profitability,
liquidity and funding metrics are tested
against severe downside scenarios.
Committee overview
Committee composition
In December 2024, the Board determined
the Committee met the UK, US and Swedish
composition requirements by virtue of Philip
Broadley and Anna Manz having recent and
relevant financial experience for the
purpose of the UK Corporate Governance
Code (the Code), having competence in
accounting and/or auditing for the purpose
of the Disclosure and Transparency Rules,
being financial experts for the purposes
of the Sarbanes-Oxley Act, and having
expertise in accounting and auditing for
the purposes of the Swedish Corporate
Governance Code and Swedish Companies
Act. The Board determined that all members
of the Committee are independent for the
purposes of the Code and that the
Committee members as a whole have
competence relevant to the sector in which
the Company operates, by virtue of their
experience of working in science-driven,
healthcare and/or pharmaceutical
industries, or as a result of their tenure with
AstraZeneca. The Committee members’
qualifications, skills and experience are
detailed in their biographies on pages 88
and 89 and meeting attendance is shown
on page 87.
Role of the Committee
The Committee’s main responsibilities
include monitoring the integrity of financial
reporting and formal announcements
relating to financial performance, reviewing
the effectiveness of internal controls, risk
management and compliance systems and
processes, and overseeing the external and
internal audit processes. The Committee
reports to the Board the principal matters
it considers and any significant concerns it
has or that have been reported to it. Further
information about the Committee’s role and
work during the year is set out in this Audit
Committee Report.
Attendance at Committee meetings
Routine attendees at Committee meetings
include the CFO; the Chief Human Resources
Officer, Chief Compliance Officer and
General Counsel; the VP, Ethics &
Transparency and Deputy Chief Compliance
Officer; the Deputy General Counsel; the VP,
Group Internal Audit; the SVP Finance, Group
Controller & Head of Global Finance
Services; and the Company’s external
auditor. The Committee, and separately the
Committee Chair, also meet privately and
on an individual basis with attendees which
helps ensure the effective flow of material
information between the Committee
and management. The CEO and other
members of the SET attend when required
by the Committee.
The full role of the Audit
Committee is set out in its
terms of reference, available
at www.astrazeneca.com.
For more information on:
The basis of preparation of
the Financial Statements on
a going concern basis, see
page 230 and in the Financial
Statements, page 152.
The significant financial
reporting issues considered,
see the table set out from
page 108.
The Viability statement on
page 63 and Principal Risks
faced by the Group, see Risk
Overview from page 64.
Corporate Governance
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Financial Statements
Strategic Report
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Sustainability reporting and
climate-related risk
The Committee is responsible for reviewing
the approach to sustainability reporting in
the Company’s annual reports, Form 20-F
filings and quarterly results announcements,
including the Group’s double materiality
assessment, TCFD disclosures and the EU
Taxonomy disclosures in this Annual Report.
These statements, as well as the
Sustainability Data Annex, are also reviewed
by the Sustainability Committee to support
the Committee’s review. Bureau Veritas, an
external assurance provider, provides
limited assurance over selected key
elements of these reports.
The Committee received updates during
the year on proposed and new regulations
by the US, EU, Sweden, the UK and the
International Sustainability Standards Board
(ISSB) on sustainability reporting. The
Committee was briefed on the Company’s
sustainability reporting plans for 2024,
including the obligation to report under
Corporate Sustainability Reporting Directive
(CSRD) requirements for the financial year
ending 31 December 2025. To facilitate a
smoother transition to CSRD reporting in
2025, the Committee approved the inclusion
of a double materiality assessment and the
adoption of reporting in a manner consistent
to, but not in compliance with, CSRD
requirements for sustainability information
in this Annual Report, whilst maintaining
continued adherence to current
requirements in the UK Companies Act,
EU Taxonomy and TCFD requirements.
Legal and Compliance
The Committee’s activities in this area
included reviewing:
•
Quarterly reports from the Legal function
to monitor the status of significant litigation
matters and governmental investigations.
•
Quarterly reports from Global Compliance
to provide oversight of key compliance
incidents (both substantiated and
unsubstantiated), possible trends and
the dispersion of incidents across our
business functions and management
hierarchy. The reports included corrective
actions taken so that the Committee could
assess the effectiveness of controls, and
monitor and ensure timely remediation.
•
Reporting on compliance with
AstraZeneca’s Code of Ethics to ensure
high ethical standards and that
AstraZeneca operates within the law
in all countries where we operate.
•
The monitoring, review, education and
improvements made to support
assurance that the risk of modern slavery
and human trafficking is eliminated, to the
fullest extent possible, from AstraZeneca’s
supply chain.
Internal Audit
The Committee reviewed Group Internal
Audit’s (GIA) activities, including:
•
Reviewing quarterly reports of work
carried out by GIA, including the status
of follow-up actions with management.
In 2024, GIA provided assurance over
compliance with significant policies,
plans, procedures, laws and regulations,
as well as risk-based audits across a
broad range of key business activities
and continued its thematic reporting to
the business. The 2024 audit plan was
aligned to our key active risks and wider
risk taxonomy. Separate meetings are
arranged to discuss follow-up actions
in more depth with specific teams,
when required by the Committee.
•
Carrying out the annual effectiveness
review of GIA in late 2024 by considering
its performance against the internal audit
plan and key activities.
•
Approving the 2025 internal audit plan,
which is aligned to our key active risks
and wider risk taxonomy.
•
Considering the geographic presence,
reach and capabilities of GIA and the
appropriateness of the Group’s resource
allocation for this vital assurance function.
The Committee supports GIA’s efforts
to deploy its resources in line with the
continuously evolving shape and size of the
overall organisation and was satisfied with
the quality, experience and expertise of the
GIA function.
An independent External Quality
Assessment of GIA is performed every five
years and was last performed in 2021.
External audit
The Company’s external auditor, PwC,
provided quarterly reports to the Committee
over key audit and accounting matters, and
business processes, internal controls and
IT systems.
The Committee oversaw the conduct,
performance and quality of the external
audit, in particular through its review and
challenge of the coverage of the external
auditor’s audit plan and subsequent
monitoring of progress against it. The
Committee maintained regular contact with
PwC through formal and informal reporting
and discussion throughout the year, with
a continued focus on maintaining audit
efficiency and quality. The Committee also
sought management’s feedback on the
conduct of the audit and considered the
level of and extent to which the auditors
challenged management’s assumptions.
Each of these scenarios assumes that
the associated risks crystallise and that
management will take mitigating actions
against those risks. The Committee
considered in detail the validity of each
scenario. The Committee also assessed
whether the proposed mitigations
were viable.
The Committee is updated on key active
and emerging risks facing the Company
through a quarterly risk management report
from the CFO. The likelihood of each of the
risks materialising and its potential impact
was monitored by the Committee and the
reports from the CFO enabled the Committee
to track the trend applicable to each risk
compared with the previous quarter. The
composition and profile of these risks
informs the Committee’s agenda of
in-depth sessions.
Cybersecurity risk, digital security
and information governance
Our approach to identifying, assessing
and managing material cybersecurity risks
(including those that result from the use of
third parties in business processes and
data management) is integrated within our
Group-wide approach to managing risk.
Failure in information technology or
cybersecurity has been identified as a
Principal Risk. Mitigations are in place to
manage these risks, and these are
monitored, and their effectiveness regularly
reported, for example in KPI dashboards
provided to management and the
Committee. Incidents are managed and
reported using the cybersecurity incident
management framework which in turn is
connected to the Group’s crisis
management framework. Cybersecurity
risks are overseen by the Committee, who
also carry out regular reviews due to the
increased importance of cybersecurity risk.
Their reviews are supported by senior
management, the VP, Group Internal Audit
and other assurance providers as required.
Cybersecurity risks (including previous
incidents) have not materially affected our
business strategy, results of operations
or financial condition.
For more information, see IT
and IS resources on page 44.
For more information on
our Code of Ethics and
on Anti-bribery and anti-
corruption, see from page 42.
AstraZeneca’s Modern
Slavery Act Statement is
available on our website,
www.astrazeneca.com.
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Audit Committee Report
continued
Reporting and regulatory environment
The Committee has kept abreast of
developments in the reporting and
regulatory environment. This has included
governance and audit reforms in the UK,
proposed financial reporting changes
following the publication of IFRS 18
‘Presentation and Disclosures in Financial
Statements’, changes to the UK Listing
Rules, and developments in sustainability-
related reporting requirements in a number
of jurisdictions.
Ensuring the quality of external financial
reporting to shareholders and other
stakeholders remains paramount to the
Committee. This includes its assessment
of the annual reports to ensure that, taken
as a whole, they are fair, balanced and
understandable (for which the process is
described on page 110). External validation
of the Annual Report is an important
indicator of the quality of our reporting.
Committee performance
The Committee conducted the annual
evaluation of its own performance, referring
to the Committee-specific results of the
Board effectiveness review prepared by
Christopher Saul Associates. The results
were reported to, and discussed with,
the Committee and the Board. The overall
results of the review were positive and
noted the Committee’s efforts and focus.
A number of interactions took place
between Committee members and
PwC during the year, outside of formal
Committee meetings, to enhance the
Committee’s understanding of the audit
process, including the Committee Chair
joining PwC’s Account Planning Workshop
to meet face-to-face with PwC team
members responsible for auditing
AstraZeneca’s in-scope global entities
in April as well as presenting virtually
to the global PwC statutory audit teams
in September.
The Committee reviewed audit and
non-audit fees of the external auditor
during the year, including the objectivity
and independence of the external auditor
through the application of the Audit and
Audit-Related Services Approval Policy,
as described further on page 110.
Engagement with employees and
other stakeholders
The Committee regularly interacts with
members of management below the SET and
seeks wider engagement with the Group’s
employees and other stakeholders, during
deep dive sessions at formal Committee
meetings and as separate engagements.
Committee members undertook a mixture
of in-person and virtual interactions with
a wide range of teams from across the
organisation. This included teams from
Information Technology and Information
Security; Operations, Finance; International,
Alexion US; and in-person visits to
AstraZeneca’s offices in Baar, Switzerland,
and AstraZeneca’s Canadian operations,
which included the manufacturing and
discovery facilities of Fusion Pharmaceuticals
Inc. and the Company’s global hub in
Mississauga, Ontario. Philip Broadley also
made an in-person visit with the Company’s
auditor, PwC, to AstraZeneca’s
manufacturing site in Sӧdertälje in Sweden.
The breadth of these interactions is
crucial in enhancing the Committee’s
understanding of the business and provides
valuable insights into the key issues and
challenges relating to, and current and
emerging risks associated with, our
activities in these areas. The Committee
welcomes the opportunity to engage
directly with employees in these meetings
which provide an opportunity to gauge
employee sentiment and hear their views
directly. The Committee also uses these
interactions to communicate the
importance it attaches to compliance
and our ‘speak up’ culture.
Further information about the
audit and non-audit fees for
2024 is disclosed in Note 31
to the Financial Statements
on page 213.
Corporate Governance
Additional Information
Financial Statements
Strategic Report
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Audit Committee Report
Significant financial reporting issues considered by the Committee in 2024
Matter considered
Committee’s conclusion and response
Valuation of
intangible assets
See Financial Review
from page 67 and
Note 10 to the
Financial Statements
from page 172.
The Group carries significant intangible assets on its
Consolidated Statement of Financial Position arising from
the acquisition of businesses and intellectual property (IP)
rights to medicines in development and on the market.
Each quarter, the CFO reports on the carrying value of the
Group’s intangible assets as well as the specific assets
identified as at risk of impairment. In respect of intangible
assets that are identified as at risk of impairment, the
Committee receives information on the difference between
the carrying value and management’s current estimate of
discounted future cash flows for these products (the
headroom). Products will be identified as ‘at risk’ if the
headroom is small or, for medicines in development, there
is a significant potentially adverse event such as the
publication of clinical trial results which could significantly
alter management’s forecasts for the product. The reviews
also cover the impact on any related contingent
consideration arising from previous business combinations.
The Committee considered the impairment reviews of the
Group’s intangible assets. Impairments of $504 million arose
in relation to launched products and $1,073 million in relation
to products in development.
The Committee assured itself of the integrity of the Group’s
accounting policy and models for its assessment and valuation
of its intangible assets, including understanding the key
assumptions and sensitivities within those models. The
Committee also considered the internal and external estimates
and forecasts for the Group’s cost of capital relative to the
broader industry. The Committee was satisfied that the Group
had appropriately accounted for the identified impairments.
Revenue recognition
See Financial Review
from page 67 and
Note 1 to the Financial
Statements from
page 160.
The US is our largest single market and accounted for
43% of our Total Revenue in 2024. Revenue recognition,
particularly in the US, is affected by rebates, chargebacks,
returns, other revenue accruals and cash discounts. More
generally, milestone payments, including the receivable of
$600 million from Merck in respect of
Lynparza
, are often
calculated on Product Sales and form part of Total Revenue.
The Committee pays attention to management’s estimates of
these items, its analysis of any unusual movements and their
impact on revenue recognition.
The Committee receives regular reports from management
and the external auditor on this complex area. The US market
remains highly competitive with diverse marketing and pricing
strategies adopted by the Group and its peers.
The Committee recognised the close monitoring and control
by management of the overall gross-to-net deductions.
The Committee reviewed the approach and control environment
in respect of the recognition of Product Sales in instances
where it triggers the recognition of a major sales-related
milestone payment, contributing to Total Revenue.
Alternative performance
measures (APMs)
See Financial Review
from page 67.
AstraZeneca reports APMs to provide helpful supplementary
information to the IFRS measures to enable a better
understanding of the Group’s financial performance
and position.
In the current period, net restructuring charges of
$1,154 million were recorded within non-core items once the
restructuring programmes were approved. Additionally, in the
prior year, the accounting for the acquisition of Alexion in
2021 resulted in more significant items being classified as
non-core.
Management carefully analyses the presentation of various
items to ensure it is fair and balanced, and follows guidelines
issued by the European Securities and Markets Authority and
the SEC, as well as FRC thematic reviews.
The Committee carefully considered management’s
presentation of the non-core items, including the removal
of the Acquisition of Alexion category, and concurred with
management’s presentation.
The Committee further considered management’s assessment
and recommendation to present the $459 million inventory
and related provision costs related to
Andexxa
as non-core
items, and concurred with management that the presentation
was appropriate due to their significance and was consistent
with classification within PAAGR in prior years.
The Committee reviewed proposed disclosures for non-GAAP
items in line with the various regulatory guidance and
concurred with management that the presentation enabled
additional helpful guidance.
Litigation and
contingent liabilities
See Note 30 to the
Financial Statements
from page 203.
AstraZeneca is involved in various legal proceedings
considered typical to its business and the pharmaceutical
industry as a whole, including litigation and investigations
relating to product liability, commercial disputes, infringement
of IP rights, the validity of certain patents, antitrust law, and
sales and marketing practices.
The Committee considers the Group’s approach to disclosure
of, and any liabilities for, relevant matters.
In the current period, net legal provisions of $44 million were
recorded for two legal proceedings within non-core items
once the criteria for recognising a provision were met.
Of the matters the Committee considered in 2024, the more
significant included: the continued defence of the IP litigation
for
Tagrisso
and the commercial litigation relating to
Syntimmune, Inc.
The Committee carefully considered the progress of these
legal proceedings in relation to the requirement of any
provision and concurred with management’s assessment that
none were required. The Committee was satisfied that the
Group was effectively managing its litigation risks including
seeking appropriate remedies and continuing to defend its IP
rights vigorously.
Corporate Governance
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Audit Committee Report
continued
Matter considered
Committee’s conclusion and response
Tax charges and liabilities
See Note 4 to the
Financial Statements
from page 163.
AstraZeneca’s
Approach to Taxation,
which was published
in December 2024 and
covers its approach to
governance, risk
management and
compliance, tax
planning, dealing with
tax authorities and the
level of tax risk the
Group is prepared to
accept, can be found
on our website,
www.astrazeneca.com.
The Group has business activities around the world and
incurs a substantial amount and variety of business taxes.
AstraZeneca pays corporate income taxes, customs duties,
excise taxes, stamp duties, employment and many other
business taxes in all jurisdictions where due. In addition,
we collect and pay employee taxes and indirect taxes such
as value-added tax. The taxes the Group pays and collects
represent a significant contribution to the countries and
societies in which we operate. Tax risk can arise from
unclear laws and regulations as well as differences in
their interpretation.
The Committee reviews the Group’s approach to tax, including
governance, risk management and compliance, tax planning,
dealings with tax authorities and the level of tax risk the Group
is prepared to accept.
During 2024, the Committee considered the tax and tax
accounting implications of projects including a cash
repatriation project. The Committee considered the analysis
provided by management and concurred with the presentation
and reporting of these items.
The Committee was satisfied with the Group’s practices
regarding tax liabilities, including, most notably, its response
to developments in the corporate income tax environment.
Segmental reporting
See the Key
Judgement within
Note 6 to the
Financial Statements
from page 166.
Management has reviewed the developments in the year
and determined the Group continues to operate as a single
segment based on key decisions on resource allocation and
performance monitoring being carried out at a Group level
by the SET.
There were no significant changes in the Group’s business
during the year.
The Committee received reports from management regarding
considerations for segmental reporting based on the current
operations and management of the business.
The Committee considered the analysis provided by
management and concurred with management that presenting
AstraZeneca’s performance under one segment was appropriate.
Retirement benefits
See Financial Review
from page 67 and
Note 22 to the
Financial Statements
from page 184.
Accounting for defined benefit pension and other post-
retirement benefits remains an important area of focus.
The present value of these liabilities is sensitive to changes
in long-term interest rates, future inflation and mortality
expectations. The assumptions used to value the liabilities
for the Group’s main post-retirement benefit obligations
are updated every quarter along with asset valuations.
The Group is cognisant of the regulatory environment and
local requirements around funding levels and contributions.
The Group monitors its defined benefit pension risks and
provides input and support to local fiduciaries to ensure
requirements are met.
The Committee monitors the funding level of the Group’s
defined benefit obligations on a quarterly basis, alongside key
developments. The Committee was satisfied that the actuarial
assumptions used to value liabilities were appropriate during
the year.
The Committee was reassured by the Group’s engaged and
balanced approach to managing the risks associated with its
defined benefit obligations including its contribution policy.
The Committee reviewed and concurred with management’s
accounting and presentation of pension balances.
The Committee is aware of the need to adhere to local
funding regulations and is satisfied that the Group is
complying with requirements.
Corporate Governance
Additional Information
Financial Statements
Strategic Report
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Audit Committee Report
External auditor
PwC is the Company’s external auditor.
In April 2024, PwC was reappointed as the
Company’s auditor for the financial year
ended 31 December 2024, its eighth
consecutive year as auditor, having first
been appointed for the financial year ended
31 December 2017, following a competitive
tender carried out in 2015. Sarah Quinn
continued as the lead audit partner at PwC
for 2024 following her appointment in
January 2022.
Audit, audit-related and other assurance
services provided by the external auditor
The Committee maintains the Audit and
Audit-Related Services Approval Policy
(the Policy) for the pre-approval of all audit
services, audit-related services and other
assurance services undertaken by the
external auditor. The principal purpose of
the Policy is to ensure that the independence
of the external auditor is not impaired.
The pre-approval procedures permit certain
audit and audit-related services to be
performed by the external auditor, subject to
annual fee limits agreed with the Committee
in advance. Pre-approved audit and
audit-related services below the clearly trivial
threshold (within the overall annual fee limit)
are subject to case-by-case approval by the
SVP Finance, Group Controller & Head of
Global Finance Services.
Pre-approved audit services included
services in respect of the annual financial
statement audit (including quarterly and
half-year reviews), attestation opinion under
section 404 of the Sarbanes-Oxley Act,
statutory audits for subsidiary entities, and
other procedures to be performed by the
independent auditor in order to form an
opinion on the Group’s Consolidated
Financial Statements. The pre-approved
audit-related services, which the Committee
believes are services reasonably related
to the performance of the audit or review
of the Company’s Financial Statements,
included certain services required by law
or regulation, such as financial statement
audits of employee benefit plans and capital
market transactions. The Policy prohibits
any tax services. Audit-related services
included the assurance in relation to tax
regulatory certificates required to be issued
by the external auditor.
The CFO (supported by the SVP Finance,
Group Controller & Head of Global Finance
Services), monitors the status of all services
being provided by the external auditor.
Authority to approve work exceeding the
pre-agreed annual fee limits and for any
individual service above the clearly trivial
threshold is delegated to the Chair of the
Committee. A standing agenda item at
Committee meetings covers the operation
of the pre-approval procedures and regular
reports are provided to the full Committee.
All services other than the pre-approved
audit and audit-related services, require
approval by the Committee on a case-by-
case basis. In 2024, PwC provided audit
services including interim reviews of the
results of the Group for the period ended
30 June 2024 and audit-related and other
assurance services.
The increase to the statutory audit fee for
2024 is largely driven by scope changes
and inflationary increases.
Fees for audit-related and other assurance
services amounted to 10% of the fees
payable to PwC for audit services in 2024
(2023: 6%). The Committee is mindful of the
70% non-audit services fee cap under EU
regulation, together with the overall
proportion of fees for audit and audit-
related services in determining whether
to pre-approve such services. Fees for
audit-related and other assurance services
payable to PwC in 2024 were 11%
(2023: 7%) of average audit fees over 2021
to 2023 (2023: 2020 to 2022).
PwC were better placed than any alternative
provider to provide these services in terms
of their familiarity with the Company’s
business, skills, capability and efficiency
with which they could deliver the relevant
services. All such services were either
within the scope of the pre-approved
services set out in the Policy or were
presented to Committee members for
pre-approval and all such services were
permitted by the FRC Ethical Standard.
$31.8m
$30.1m
2024
2023
Audit/audit-related and other
assurance services
Statutory audit fee
Audit-related and other assurance services
Fair, balanced and
understandable assessment
As in previous years, at the instruction of
the Board, the Committee undertook an
assessment of this Annual Report to ensure
that, taken as a whole, it is fair, balanced
and understandable and provides the
information necessary for shareholders
to assess the Company’s position and
performance, business model and strategy.
The Committee reviewed the Company’s
governance structure and assurance
mechanisms for the preparation of this
Annual Report and, in particular, the
contributor and SET member verification
process. The Committee received an early
draft of this Annual Report to review its
proposed content and the structural
changes from the prior year and to
undertake a review of the reporting for
the year, following which the Committee
members provided their individual and
collective feedback. Additionally, in
accordance with its terms of reference,
the Committee (alongside the Board) took
an active part in reviewing the Company’s
quarterly announcements and considered
the Company’s other public disclosures
which are managed through its Disclosure
Committee (the Committee was updated
on matters considered by the Disclosure
Committee regularly throughout the year).
To aid its review further, the Committee also
received a summary of the final Annual
Report’s content, including AstraZeneca’s
successes and setbacks during the year
and an indication of where they were
disclosed within the document.
The processes described above allowed
the Committee to provide assurance to the
Board to assist it in making the statement
required of it under the Code, which is set
out from page 91.
Internal controls
Information on the Company’s internal
controls is included in the Audit, risk and
internal control section in the Corporate
Governance Report on page 92. During the
period covered by this Annual Report there
was no change in our internal control over
financial reporting that occurred that has
materially affected, or is reasonably likely
to materially affect, our internal control over
financial reporting.
At the January 2025 Committee meeting,
the CFO presented the conclusions of the
evaluation by the CEO and CFO of the
effectiveness of our disclosure controls and
procedures that is required by Item 15(a) of
Form 20-F as at 31 December 2024. Based
on their evaluation, the CEO and the CFO
concluded that, as at that date, the
Company maintained an effective system
of disclosure controls and procedures.
Corporate Governance
110
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Annual Report & Form 20-F Information 2024
Audit Committee Report
continued
Each of the big four audit firms and two
challenger firms were invited to participate
in the tender. PwC and KPMG were the
only two firms that were able and willing
to tender for the audit. The Committee
reviewed and approved the selection
criteria which covered FRC Audit Quality
assessments over the preceding three
years, expertise of the proposed global
audit teams, audit methodology, use of
audit technologies and expertise in
auditing organisations upgrading their
Enterprise Resource Planning systems
technology. The process focused on the
quality criteria, in line with the FRC
guidance, and was fee-blind. The tender
process was supervised by the Audit
Tender Panel, which comprised the Chair
of the Audit Committee and Anna Manz
as well as management representatives.
To provide a better understanding of
AstraZeneca’s business, processes and
teams, both firms were provided with
access to an online data room of relevant
information, along with additional
information where requested. Management
also organised over 20 workshops for the
firms to meet senior finance and business
management across different business
units and functions.
Both firms provided written proposals and
gave presentations to, and answered
questions from, the Audit Tender Panel on
their respective use of innovative tools for
the performance of the audit in future years,
their proposed teams and audit proposals.
Mr Broadley and Ms Manz interviewed the
proposed lead audit partners of both firms
and met a cross section of the proposed
audit teams, including specialist partners
and audit staff.
The Committee discussed Mr Broadley
and Ms Manz’s conclusions from the tender
process and management’s qualitative
and quantitative assessment of the two
firms based on the selection criteria.
Following that discussion, the Committee
recommended, and the Board endorsed,
the appointment of KPMG as the Group’s
external auditor for the financial year ending
31 December 2026. A resolution will be put
to shareholders at the 2026 AGM to approve
this appointment. It is intended that PwC
will continue as the Group’s auditors for the
years ended 31 December 2024 and 2025
and will cease to hold office at the conclusion
of the Company’s 2026 AGM.
The Committee also aligned with
transitioning the limited assurance of
sustainability reporting to KPMG for the
financial year ending 31 December 2025
upon adoption of mandatory CSRD
reporting. The Committee also commenced
reviewing reporting covering KPMG’s
journey to independence to meet regulatory
requirements in time for the commencement
of sustainability assurance in 2025 as well
as financial audit in 2026.
Regulation
The Committee considers that the Company
has complied with the Competition and
Markets Authority’s Statutory Audit Services
for Large Companies Market Investigation
(Mandatory Use of Competitive Tender
Processes and Audit Committee
Responsibilities) Order 2014 in respect
of its financial year commencing
1 January 2024.
Assessing external audit effectiveness
In accordance with its normal practice, the
Committee considered the performance of
PwC and its compliance with the
independence criteria under the relevant
statutory, regulatory and ethical standards
applicable to auditors. The Committee
assessed PwC’s effectiveness principally
against four key factors, namely: judgement;
mindset and culture; skills, character and
knowledge; and quality control. As part of that
assessment, it also took account of the views
of senior management within the Finance
function and regular Committee attendees.
As part of the Committee’s assessment
of the quality of the audit, the Committee
focused on the auditor’s effective use
of experts and technology as well as
appropriate challenge of management’s
judgements especially in relation to areas
of significant financial reporting issues
(as described in the table on pages 108
and 109). Areas that were reviewed by the
Committee included PwC’s extensive and
detailed review of the valuations and
assumptions related to defined benefit
pension valuations, assumptions and
calculations over Gross to Net Product Sales,
legal settlements in the year, intangible asset
assumptions used in cashflow modelling,
and the recognition and measurement of
uncertain tax liabilities.
The Committee concluded that the PwC
audit was effective for the financial year
ended 31 December 2024. In February
2025, the Committee recommended to the
Board the reappointment of PwC as the
Company’s auditor for the financial year
ending 31 December 2025. Accordingly,
a resolution to reappoint PwC as auditor
will be put to shareholders at the Company’s
AGM in April 2025.
External audit tender
In November 2023, with the UK legal
requirements for the Company to tender
the external auditor every 10 years in mind,
the Committee began a tendering process
for both the financial audit and sustainability
assurance to enable the selection of an
auditor in 2024 for the 2026 or 2027
financial year. The Committee committed
to a fair, open and transparent process and
reviewed and approved the process,
timetable and information requirements,
which followed best practice corporate
governance requirements, including all
relevant FRC guidance on audit tendering.
Corporate Governance
Additional Information
Financial Statements
Strategic Report
111
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Annual Report & Form 20-F Information 2024
Audit Committee Report
“On behalf of the Committee,
I thank those shareholders
who supported our new
Remuneration policy,
which allows us to incentivise
the delivery of our Ambition
2030 through our pay
for performance philosophy.”
Remuneration Committee
members
• Sheri McCoy (Chair)
• Philip Broadley
• Michel Demaré
• Nazneen Rahman
On behalf of the Board, I am pleased
to present AstraZeneca’s Directors’
Remuneration Report for the year ended
31 December 2024.
2024 has seen AstraZeneca successfully
continue on its strong growth trajectory
towards delivery of Ambition 2030. Our
sustained performance over the year
delivered Total Revenue of $54.1 billion,
an increase of 18% at actual rates of
exchange (21% at CER) since 2023.
In May, we held our Investor Day, which
gave us the opportunity to share in detail
our strategy for Ambition 2030, our
continued commitment to long-term growth
and how we plan to continue to deliver
shareholder value. Over 2024, significant
progress has already been made towards
these goals. We have invested in
transformative technologies, such as
antibody drug conjugates, radioconjugates,
cell therapy and T-cell engagers, with a
view to eliminating cancer as a cause of
death; and invested in gene therapy and
gene editing for our Rare Disease portfolio,
all of which will help to drive our growth.
Over the year, we have continued to see
significant positive readouts and regulatory
approvals which reinforce the quality of our
pipeline and our ambition to launch 20 new
molecular entities (NMEs) by 2030. Eight of
these NMEs have already been launched,
including
Imjudo
,
Beyfortus
,
Voydeya
and
Datroway
.
Our global commercial footprint continues
to provide substantial growth opportunity
for our medicines across all therapy areas
and regions. In the US, Total Revenue
increased by 22% in 2024 to $23.2 billion
driven by continued strong growth of our
Oncology and BioPharmaceuticals business
units. In Emerging Markets, AstraZeneca
was the largest multinational pharmaceutical
company, as measured by prescription sales.
In Europe, Total Revenue was $12.2 billion,
an increase of 27% (26% at CER) on 2023.
More information on some of our 2024
achievements is set out on page 114.
Key Committee activities in 2024
At the Company’s 2024 Annual General
Meeting (AGM), the Board was pleased that
the 2023 Directors’ Remuneration Report
received support from 95% of shareholders.
The Board also put a new Remuneration
Policy (the Policy) and amendments to the
AstraZeneca Performance Share Plan (PSP)
(together, the Remuneration Resolutions) to
shareholders for approval at the 2024 AGM.
The Remuneration Resolutions were
approved with 64.43% and 65.34% support,
respectively. However, the Committee
acknowledged that a notable proportion
of shareholders did not support the
Remuneration Resolutions at the 2024 AGM.
Following the AGM, I undertook an
extensive consultation process to listen
to the feedback of our shareholders and
the proxy advisors and to discuss the
implementation of the 2024 Policy. The
engagement reached over 50% of our
issued share capital and included written
communications with our 75 largest
shareholders, plus meetings with eight of
our largest shareholders and three proxy
advisers. AstraZeneca’s largest investors
remain fully supportive of the leadership
team, our pay for performance philosophy
and of our Ambition 2030. Our major
shareholders understand the rationale for
the Policy changes, the global nature of
the business and the need to be able to
compete for talent globally, and recognise
that the Committee believes that UK- listed
FTSE companies are not the right peer
group for us to use, given AstraZeneca’s
size, complexity and global footprint
relative to FTSE peers, and the influence
of pay practice within the global
pharmaceutical industry.
The role of the Remuneration
Committee is set out in its
terms of reference, available at
www.astrazeneca.com.
We aim to be clear and
transparent in how we
link remuneration of
our executives to the
successful delivery
of our strategy and
shareholder returns.
The Directors’ Remuneration
Report contains the following
sections:
• Chair’s letter, page 112
• Remuneration at a glance,
page 116
• How our performance
measures for 2025 support
the delivery of our strategy,
page 117
• How the Remuneration
Committee ensures targets
are stretching, page 118
• Annual Report on
Remuneration, page 119
Corporate Governance
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Directors’ Remuneration Report
400
300
200
100
Dec
14
Dec
15
Dec
16
Dec
17
Dec
18
Dec
19
Dec
20
Dec
21
Dec
22
Dec
23
Dec
24
the sustainability metric will comprise of
the aggregate reductions from the next-
generation propellant (NGP) transition,
primary distribution and business travel,
which represent approximately 25% of our
2024 value chain (Scope 3) GHG emissions.
The Committee has continued to evaluate
the reward of the wider workforce and in
2024 reviewed the full collective offering
of our long-term incentives available to
employees around the world. Currently 35%
of the workforce is eligible to participate in
long-term incentive (LTI) programmes and
the Committee continues to explore ways
in which this might be expanded further.
During 2024, we have approved increases
to the quantum of LTIs we offer to ensure
we remain market competitive across the
globe. Our emphasis remains firmly on
performance, market competitiveness
and equitable reward and we are supportive
of the level of importance the Company
continues to place on enabling total reward
decisions to be made without bias. We
endorse the ongoing efforts to educate
managers on making equitable reward
decisions and to build internal capability
in relation to this topic, including the
development of tools to help with reward
decision making.
A number of our shareholders and proxy
advisers voiced their concerns in relation
to the increased opportunity at threshold
provided under the new Policy and
requested to hear more about the process
for making decisions on outcomes and
setting targets. In response to these
concerns, we confirmed that the Committee
made a conscious decision for the uplift in
remuneration opportunity to be through
performance-based pay, and that we
remain committed to transparent
disclosures and to stretching performance
targets which are aligned to the creation of
shareholder value. The process of setting
our targets is comprehensive and robust.
We rigorously review stretch in conjunction
with management, the Audit Committee, the
Science Committee and the Sustainability
Committee, along with our external
independent advisers, not only in relation
to our internal ambitions, but also relative
to consensus and how analysts view
our potential. The same scrutiny is used
to assess performance outcomes and
we can demonstrate a consistently clear
link between incentive outcomes
and performance.
The new Policy allows us to continue to
provide competitive executive remuneration
in a high performance culture, and is
structured such that the Executive Directors
will only benefit from the increased
remuneration when they deliver strong
returns for investors. It has provided
headroom to deploy appropriately leveraged
pay for performance compensation across
our most senior leadership levels (below our
Executive Directors), and it enables us to
retain and compete for the best talent,
including in the US. The Committee is
confident that the Policy reflects
AstraZeneca’s global market position, the
strength of our pipeline and will incentivise
the delivery of our ambitions in the future.
I would like to thank those that took part in
the consultation for their constructive
feedback and those shareholders who
supported our proposals.
Our short- and long-term incentive metrics
will remain broadly unchanged for 2025.
We continue to be happy with the balance
and choice of metrics which we believe
appropriately underpin our strategy and
incentivise performance. As we reach the
end of our Scope 1 and 2 greenhouse gas
(GHG) emission glide path, the PSP
sustainability metric will encompass aspects
of value chain (Scope 3) GHG emissions
from 2025 onwards. For the 2025 PSP,
How we have performed in 2024
Total shareholder return (TSR)
2022 to 2024
1
+33%
AstraZeneca
Global pharmaceutical peers average
European pharmaceutical peers average
FTSE 100
1
Calculated using a three-month calendar average, from 1 October to 31 December, prior to the start and at the end of
the relevant period.
Delivery against strategy – 2024 Group scorecard performance
2
Target
2024
outcome
Science and Innovation: Annual pipeline progression
Pipeline progression events
27
24
Regulatory events
42
52
Growth and Therapy Area Leadership
3
Total Revenue
$52.1bn
$53.8bn
Achieve Group Financial Targets
Cash flow
4
$10.2bn
$10.1bn
Core EPS
5
$7.82
$8.22
2
For details of the Committee’s consideration of Group scorecard outcomes and a description of performance
measures, see from page 121.
3
Total Revenue target and outcome are at 2024 budget rates of exchange.
4
The Cash flow measure is set and evaluated at the actual exchange rate and is evaluated by reference to net cash
flow from operating activities less capital expenditure, adding back proceeds from disposal of intangible assets.
5
Core EPS target and outcome are at 2024 budget rates of exchange.
More information on the TSR
peer groups for PSP awards
can be found on page 125.
Further detail of 2024
commercial and scientific
performance can be found in
the Strategic Report from
page 12.
Corporate Governance
Additional Information
Financial Statements
Strategic Report
113
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Annual Report & Form 20-F Information 2024
Directors’ Remuneration Report
TSR
People and Sustainability:
Being a great
place to work is a commitment to our people
and we aim to create great employee
experiences that ignite innovation, unite
diverse talent and unlock capacity. We are
recognised externally for our work prioritising
inclusion and diversity and are pleased that
44 countries of origin are represented at
executive levels and 50.6% of our senior
leaders are women. We remain dedicated to
promoting personal growth, lifelong learning
and enterprise leadership. We celebrated
Learning at Work Week, and have seen over
1.96 million Degreed learning completions
over the year. We have enabled over
2.1 million hours of total learning for our
employees and have seen over 10,000
employees participate in our Generative AI
Accreditation programme. Our Pulse results
demonstrate that we have a highly engaged
workforce with 80% of our employees
agreeing that they feel valued for diverse
opinions and thinking, and 84% of our
employees saying that they receive
coaching to improve their contribution.
Sustainability remains core to our strategy
of improving the health of people, society
and the planet and we believe that through
science we can make a positive impact.
We have made significant progress towards
Ambition Zero Carbon, despite the Group
almost doubling in size since 2020. In 2024,
we reached the significant milestone of over
60% of our global fleet being battery
electric vehicles. We are also very proud
that Södertälje has reduced Scope 1 and 2
GHG emissions by 98% (from 2015
baseline), which is an outstanding
achievement. We also continue to work
towards achieving a 50% target reduction
in Scope 3 emissions from the 2019
baseline by 2030. In 2024, we made the
first regulatory submission for
Breztri
NGP
in the EU in 2024, an important step in
transitioning our inhaled medicines to a NGP
with near-zero global warming potential –
99.9% lower than current propellants.
Through our Green Labs programme,
we are embedding sustainability into
research processes to reduce laboratory
emissions and waste and to date, over
4,000 colleagues have optimised ways of
working and championed a sustainability
culture in their labs. We were proud to have
been awarded the EcoVadis Sustainability
Achievement Award for ‘Best Mature
Program’ and we continued to drive global
change at Climate Week NYC, the biggest
annual climate event of its kind, and being
a signatory on an open letter from
The Alliance of CEO Climate Leaders to
world leaders about the changes that need
to be implemented to make a difference.
AstraZeneca’s 2024 performance
Science and Innovation:
2024 has been
a significant year for AstraZeneca in
advancing our science and medicines,
and investing in new transformative
technologies and modalities. These
developments have enabled us to deliver
medicines to patients while sustaining
long-term growth. We continued to drive
progress in our pipeline, delivering 24
pipeline progression events – including
Phase II NME starts and Phase III investment
decisions – which are critical steps in
developing new treatments. While this
number is slightly lower than last year’s
30 events, it reflects our focused approach
on high-impact projects that will bring
meaningful benefits to patients. We achieved
74 regulatory events, with 52 contributing to
the Group scorecard for determining the
annual bonus, exceeding our target. These
regulatory milestones underscore our
commitment to bringing new medicines to
market efficiently and effectively. Externally,
the quality of our scientific research was
recognised at key medical congresses
throughout the year. We reinforced our
leadership in R&D through novel treatment
and combination approaches, showcasing
our dedication to innovation and excellence
in science.
Growth and Therapy Area Leadership:
Overall the Company has seen strong
underlying performance with double-digit
growth in Total Revenue across four therapy
areas. Total Revenue increased by 18%
(21% at CER), driven by a 16% (19% at CER)
increase in Product Sales, continued growth
of partnered medicines (Alliance Revenue)
and the achievement of sales-based
milestones (Collaboration Revenue).
Oncology Total Revenue increased by
21% (24% at CER) to $22,353 million.
BioPharmaceuticals Total Revenue
increased by 19% (21% at CER) to
$21,855 million, with CVRM and R&I both
experiencing double-digit growth in Total
Revenue. Total Revenue from Rare Disease
medicines increased by 13% (16% at CER)
to $8,768 million.
Achieved
Science and Innovation: Annual pipeline progression
65%
Growth and Therapy Area Leadership
100%
Achieve Group Financial Targets
73%
Achieved
Achieved
Science and Innovation: First approvals and NME
volume over three years
100%
Growth and Therapy Area Leadership
100%
Net Cash flow
100%
Relative TSR
20%
Sustainability: Ambition Zero Carbon
100%
Achieved
1
When determining bonus outturns, the Committee considered the formulaic outcome from the Group scorecard along
with wider business and individual impact and performance in 2024, including ESG achievements.
2024 Annual bonus scorecard performance
1
2022 PSP performance
Corporate Governance
114
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Annual Report & Form 20-F Information 2024
Directors’ Remuneration Report
continued
Global median
£15.3m
AstraZeneca
£11.3m
AstraZeneca
£11.3m
AstraZeneca
£5.0m
AstraZeneca
£5.0m
Global
pharmaceuticals
1
European
pharmaceuticals
2
Global median
£5.4m
Global
pharmaceuticals
1
European
pharmaceuticals
2
Positioning of our executives against global and European pharmaceutical peers
European median
£7.5m
European median
£4.3m
Target Total Direct Compensation (base pay, target annual bonus and target LTI)
Target Total Direct Compensation (base pay, target annual bonus and target LTI)
Target Total Direct Compensation (base pay, target annual bonus and target LTI)
21
9
12
15
18
6
3
10
2
4
6
8
0
CEO (£m)
CFO (£m)
Non-Executive Directors’ fees
From January 2025, certain of the Non-
Executive Directors’ fees, including the
Chair’s fee, have been increased.
In addition, a fee has been introduced
for membership of the Nomination and
Governance Committee. From December
2024, the Chair and Non-Executive Director
fees will be reviewed annually to ensure
they reflect the workload and
responsibilities of non-executive directors
of a large, listed company, and remain
competitive with other major listed
companies. No Board member participates
in any decisions relating to their own fees.
Further detail is provided on page 128.
Next steps
I hope that you find this Remuneration
Report clear in explaining the implementation
of our Policy during 2024. We trust that we
have provided the information you need to
be able to support this Remuneration Report
at the Company’s AGM in April 2025.
Our ongoing dialogue with shareholders
and other stakeholders is valued greatly
and, as always, we welcome your feedback
on this Directors’ Remuneration Report.
Sheri McCoy
Chair of the Remuneration Committee
2024 remuneration outcome
The Committee always seeks to ensure that
the remuneration of our Executive Directors
and our wider workforce reflects the
underlying performance of the business.
When approving outcomes, we therefore
considered the Group scorecard along with
wider business and individual performance
over 2024, including other achievements
across the enterprise, such as advancing
our People and Sustainability priorities.
In that context, the Committee believes that
the payments outlined below fairly reflect
their performance.
Annual bonus
157% of target – 78.5% of maximum
When determining bonus outturns, the
Committee considered the formulaic
outcome from the Group scorecard along
with wider business and individual impact
and performance in 2024, including ESG
achievements. The Committee determined
to award an annual bonus equivalent to
157% of target (78.5% of maximum) to
Mr Pascal Soriot and Dr Aradhana Sarin
(equivalent to 235.5% and 157% of base
pay respectively), in line with the Group
scorecard outcome. Details of the factors
considered to determine the bonuses are
provided from page 121.
Long-term incentives
2022 PSP – 84% of maximum
Our approach aims to reward sustainable
outperformance and as a result of three
very strong years, our 2022 award will
vest towards the upper end of the possible
range. The three-year performance period
for PSP awards granted to our senior
leaders in 2022, ended on 31 December
2024. Awards for all participants will vest
at 84% of maximum, as shown from
page 124 and reflects continued
strong performance.
1
Global pharma peer group consists of: AbbVie, Amgen, BMS, Eli Lilly, Gilead, GSK, Johnson & Johnson, Merck,
Novartis, Novo Nordisk, Pfizer, Roche and Sanofi (Sanofi within CEO comparator group only).
2
European pharma peer group consists of: Bayer, GSK, Merck KGaA, Novartis, Novo Nordisk, Roche and Sanofi
(Sanofi within CEO comparator group only).
Remuneration includes base pay, target annual bonus and the expected value of LTI awards. Benchmarking data has
been provided by the Committee’s independent adviser.
Corporate Governance
Additional Information
Financial Statements
Strategic Report
115
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Annual Report & Form 20-F Information 2024
Directors’ Remuneration Report
CEO
CFO
6,751
14,728
£5,000
£10,000
£15,000
£0
£ʼ000
Share price appreciation on long-term incentive awards
PSP (subject to a 2-year holding period)
Annual bonus (50% subject to deferral for 3 years)
Fixed pay
CEO fixed vs performance-linked (%)
CEO fixed vs performance-linked (%)
33%
Short-term
67%
Long-term
Fixed
9%
Performance-linked
91%
Base pay
Benefits fund
Pension
Annual bonus – cash
Annual bonus – shares
PSP
CFO fixed vs performance-linked (%)
CFO fixed vs performance-linked (%)
36%
Short-term
64%
Long-term
Fixed
13%
Performance-linked
87%
Base salary
Benefits fund
Pension
Annual bonus – cash
Annual bonus – shares
PSP
Annual
bonus
(halved)
1
PSP
ʼ25
Executive Directorsʼ variable pay
Executive Directorsʼ variable pay
Performance period
Deferral period
Holding period
ʼ26
ʼ27
ʼ28
ʼ29
See from page 119 for further information on the annual
bonus and PSP outcome.
When determining bonus awards, the Committee
considered the formulaic outcome from the Group
scorecard along with wider business and individual impact
and performance in 2024, including ESG achievements.
Fixed pay consists of base pay and benefits funding.
Further information on Executive Directors’ realised pay
for 2024 is on page 119.
Based on maximum payout scenarios for the CEO assuming maximum
of 300% and 850% of base pay for annual bonus and PSP respectively.
Based on maximum payout scenarios for the CFO assuming maximum
of 200% and 550% of base pay for annual bonus and PSP respectively.
1
Half of the annual bonus is deferred for three
years.
See from page 121 for further details on
plan design.
Group scorecard
performance
Achieved 78.5% of max
Lapsed 21.5%
2022 PSP
performance
Achieved 84%
Lapsed 16%
Fixed remuneration
Annual bonus
Long-term incentives
Shareholding
requirement
Post-cessation
shareholding
requirement
Pascal Soriot
(CEO)
Base pay:
£1,545,084
Benefits fund
Pension: £169,959
(equivalent to 11%
of base pay)
Max: 300%
base pay
Target: 150%
base pay
Deferred: 50%
for three years
Max: 850%
base pay
Performance
period: three years
Holding period:
two years
Holding
requirement:
1,150% base
pay
Holding
requirement
1,150% base
pay for two
years
post-cessation
Aradhana
Sarin
(CFO)
Base pay:
£989,554
Benefits fund
Pension: £108,851
(equivalent to 11%
of base pay)
Max: 200%
base pay
Target: 100%
base pay
Deferred: 50%
for three years
Max: 550%
base pay
Performance
period: three years
Holding period:
two years
Holding
requirement:
750% base pay
Holding
requirement:
750% base pay
for two years
post-cessation
Executive Directors’ realised pay 2024 outcomes
What our Executive
Directors earned
Formulaic outcome of 2024 Group
scorecard and 2022 PSP
Looking ahead
Executive Directors’ remuneration for 2025
116
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Annual Report & Form 20-F Information 2024
Corporate Governance
Remuneration at a glance
Our focus on incentivising innovative
science aligns with our patient-centric
culture, as we strive to push the boundaries
of science to deliver life-changing
medicines to patients. The 2025
performance measures are closely
aligned with our strategic priorities,
as shown below.
AstraZeneca aims to continue to
deliver great medicines to patients while
maintaining cost discipline and a flexible
cost base, driving operating leverage and
increased cash generation. To incentivise
and reward delivery of great performance
over the short and longer term, the
Committee carefully considers the balance
of science, financial and ESG measures
between the Annual bonus and PSP.
Strategic pillar
Science and Innovation
Remuneration performance measures
Science indices
Our science measures incentivise the
development of NMEs and the maximisation
of the potential of existing medicines.
Bonus performance is assessed on pipeline
progressions through Phase II and Phase III
clinical trials. These reflect the outcome of
nearer-term strategic investment decisions.
As registrational Phase II trials become more
common practice (for example in relation to
cell therapy), pipeline progression events for
bonus performance includes pivotal
investment decisions for registrational
Phase II and Phase III trials.
In contrast, PSP performance is assessed
on the volume of NMEs in Phase III and the
registration stage, which reflects the outcome
of longer-term strategic investment decisions.
Additionally, we measure regulatory
submissions and approvals for bonus, and
regulatory approvals for PSP to drive the
conversion of scientific progress into
commercial revenue over the short term
(bonus) and the longer term
(PSP).
Together, these science measures
incentivise innovation and sustainable
success along the length and breadth of the
pipeline, leading to commercial growth.
Strategic pillar
People and Sustainability
We are committed to people and making
a difference to society. Assessment of
performance against this pillar is captured
through our holistic review of each Executive
Director’s individual performance (detailed
on pages 122 and 123) as part of the final
determination of annual bonus, including
consideration of our progress against our
People and Sustainability aspirations:
•
Deliver a great employee experience
by promoting inclusion and diversity,
and fostering personal growth and
enterprise leadership.
•
Leading on climate, equity and resilience
by accelerating Ambition Zero Carbon,
leading in addressing the connection
between climate and health, and driving
health equity and system resilience.
•
Enabling an agile organisation by
developing and implementing Gen AI
strategy, investing in site footprint and
workplaces, and simplifying processes.
Value Chain Emissions
This measure encompasses aspects of our
value chain (Scope 3) GHG emissions and
for the 2025 PSP comprises the aggregate
reductions from the NGP transition, primary
distribution and business travel, representing
approximately 25% of our 2024 value chain
(Scope 3) GHG emissions.
Strategic pillar
Growth and Therapy Area Leadership
Remuneration performance measures
Total Revenue
Our Total Revenue measure is included in the
bonus and the PSP, reflecting the importance
of incentivising sustainable growth in both
the short and longer term.
For more information about our
strategic priorities, see from
page 12.
For more information about the
2025 performance measures,
see from page 127.
Financial targets
Achieve Group Financial Targets
Remuneration performance measures
Cash flow
Ensures that we can sustain investment in
our pipeline and therapy areas while at the
same time meeting our capital allocation
priorities. Cash flow is included in both the
bonus and the PSP, ensuring a focus on both
short- and longer-term cash flow generation
and balance sheet strength.
Core EPS
Incentivises operational efficiency and cost
discipline, and remains a key measure of our
profitability and a focus for our investors.
Total shareholder return
Assessed relative to our peer group of
companies, the TSR measure rewards
positive performance that our shareholders
also directly benefit from. This measure
incentivises outperformance versus our
peer group, and promotes the delivery
of long-term sustainable returns for
our shareholders.
Key
Annual bonus
PSP
KPI
Corporate Governance
Additional Information
Financial Statements
Strategic Report
117
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Directors’ Remuneration Report
How our performance measures for 2025 support the delivery of our strategy
We set stretching targets that incentivise our leaders to deliver exceptional performance, and to drive sustainable results for our patients,
our employees and our shareholders. For the 2025 targets:
•
The Committee has reviewed the proposed targets against internal and external forecasts, including market consensus and peer group
performance, and is comfortable that the level of stretch promotes truly exceptional performance in line with the delivery of the
2030 Ambition.
•
In real terms, taking into account exchange rate differences, financial performance goals under the 2025 Group scorecard and PSP
would require achievement above prior year outturns and growth in excess of the average expected of the industry, particularly when
taking the significant capital investment expected to be made during the performance period.
Consistent with our approach in prior years, we undertake the following robust process to setting annual bonus and PSP targets and
assessing outcomes:
Stage 1 –
Target
setting
Science targets are based on a cohort of scientific opportunities
specified at the start of the performance period. Opportunities
represent potential achievements through the pipeline, from an early
stage where our scientists work to discover new molecules, through
to ultimately obtaining approvals and getting new medicines to
patients. Rewarding success at each stage recognises the importance
of creating and maintaining a long-term sustainable pipeline. Stretch
of proposed targets is reviewed by the Science Committee, taking into
account factors such as the expected net present value of the pipeline
and the anticipated financial contribution it will make, past
performance, the external regulatory environment, and internal
resourcing and efficiencies. Targets for realisation of these
opportunities are ambitious. The outlook for the delivery of the
pipeline is increasingly challenging given the rising proportion of new
modalities and innovation, representing previously untested science.
Proposed targets for the Sustainability measure are reviewed
and endorsed by the Sustainability Committee and exceed the
1.5°C Paris Agreement glide path. Our decarbonisation ambitions
are increasingly challenging to deliver in the context of broader
enterprise growth, particularly the higher supply volumes required
to fulfil demand for our medicines.
Financial target metrics align with the Company’s Mid-Term Plan
(MTP), which sets out the financial framework for delivering our
ambitious strategy over a three-year period. The MTP process
includes detailed business reviews, during which plans and
efficiencies of each unit are challenged, leading to a proposed
MTP for the Board to review and challenge. The Committee sets
targets based on the Board-approved MTP, considering
consensus expectations, independent analytics, and anticipated
challenges and opportunities. Whilst Total Revenue and Core EPS
targets are set at budget exchange rates at the beginning of the
performance period and evaluated at those rates at the end of the
performance period (so that any beneficial or adverse movements
in currency do not impact reward outcomes), the Committee also
compares targets against prior plans at constant exchange rates,
to ensure that new targets incentivise ambitious levels of growth.
Where consensus figures do not align with internal forecasts,
the Committee seeks to understand why a difference exists
(such as differences in assumed capital expenditure). This range
of data is used by the Committee to ensure the stretching nature
of performance targets is robustly tested. Additionally, the PSP
TSR measure is designed to reward strong performance relative
to our peers.
Stage 2 –
Committee
review and
approval of
targets
The Committee thoroughly reviews and challenges targets
proposed by management, working in partnership with the Science
and Sustainability Committees to ensure targets are stretching
and robust.
The Committee is provided with considerable supporting material
for each metric and receives briefings from senior leaders across
AstraZeneca. The science measures are reviewed and endorsed
by the Science Committee, with a focus on ensuring that the
targets will result in long-term sustainable value creation, and the
Committee reviews and approves the full cohort of opportunities.
The sustainability metric within the PSP is aligned to our Ambition
Zero Carbon goal and reflects the importance of decarbonisation,
with a new focus on value chain (Scope 3) GHG emissions.
The sustainability metric has been reviewed and endorsed by our
Sustainability Committee.
Committee members participate in the full Board discussions on
the strategy, MTP and budget, which form the basis for the targets.
The Committee considers how proposed financial targets align
with the MTP and budget; prior years’ outcomes (in absolute terms
and against target); how the ambition has changed from the prior
MTP and budget; external guidance the Company has provided
or plans to give; consensus from external financial analysts and
factors it may be impacted by; and the underlying assumptions.
Statistical analysis conducted by the Committee’s independent
adviser is also used to assess the proposals. This includes an
assessment of historical levels of performance volatility.
Stage 3 –
Performance
assessment
At the end of the period, final performance against each metric is
assessed. Outcomes are calculated based on performance against
each weighted metric. Each performance measure is assessed on a
standalone basis, so that underperformance against one measure
cannot be compensated for by overperformance against another.
Data for the metrics is taken from the Group’s financial reports which
are reviewed by the Audit Committee and approved by the Board.
The Science Committee independently considers and informs
the Committee whether science achievements represent a fair
and balanced outcome, reflecting genuine achievements and
pipeline progression. The sustainability metric within the PSP is
validated by the Sustainability Committee. Apart from Cash flow,
which is set at actual rates of exchange, financial metrics are set
at budget rates of exchange and evaluated at those rates at year
end, which means they are not directly comparable year-on-year.
The Committee is, however, provided with data to allow it to
conduct year-on-year analyses.
Stage 4 –
Determination
of Executive
Directors’
bonuses
For annual bonus, the fairness of the formulaic Group scorecard
outcome is considered in the context of overall business performance
and the experience of shareholders. Such considerations include
TSR performance and each Executive Director’s personal impact
on the delivery of the strategy, wider ESG performance and other
organisational achievements, such as inclusion and diversity targets
and the realisation of technology-based milestones. Each year, there
are important individual deliverables beyond the scorecard metrics
which are taken into account when determining individual bonuses.
Having considered the Group scorecard outcome, overall
business performance, the experience of shareholders and
individual performance, as detailed from page 122, the Committee
carefully determines a final bonus outcome for each Executive
Director that is considered fair and appropriate for the year’s
performance, and is in the best interests of shareholders.
Corporate Governance
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How the Remuneration Committee ensures targets are stretching
The elements within the Executive Directors’ realised pay are colour coded:
•
Fixed remuneration has a light blue border and is found on page 120.
•
Annual bonus has a yellow border and can be found on pages 120 to 124.
•
Long-term incentives (LTI) has a magenta border and can be found on pages 124 to 127.
Executive Directors’ remuneration
This section of the Directors’ Remuneration Report sets out the Executive Directors’ remuneration for the year ended 31 December 2024,
alongside the remuneration that will be paid to Executive Directors during 2025.
Audited
Executive Directors’ realised pay for 2024 (single total figure of remuneration)
The table below sets out all elements of realised pay receivable by the Executive Directors in respect of the year ended 31 December 2024,
alongside comparator figures for 2023. This includes the vesting of PSP awards from 2022 following the three-year performance period.
These shares are subject to a further two-year holding period. The increase in AstraZeneca’s share price over the period of grant to vest
has provided the Executive Directors with a significant increase in value of the equity components of their reward. £1,397,676 of Mr Soriot’s
and £619,702 of Dr Sarin’s 2024 realised pay is attributable to share price increases. The benefit of the increased share price has also been
experienced by shareholders.
The Committee did not exercise any discretion in relation to the LTI outcomes or the formulaic outcome of the Group scorecard.
£’000
Base
pay
Taxable
benefits
Pension
Other
Total fixed
Annual
bonus
Long-term
incentives
1
Total
variable
Single total
figure
Share price
appreciation
as % of single
total figure
Pascal Soriot
2024
1,486
138
163
–
1,787
3,499
9,442
12,941
14,728
9%
2023
1,429
140
157
–
1,726
2,839
12,806
15,645
17,371
26%
Aradhana Sarin
2024
951
14
105
–
1,070
1,494
4,187
5,681
6,751
9%
2023
915
46
101
–
1,062
1,455
1,972
3,427
4,489
10%
1
Long-term incentive values disclosed in 2023 have been recalculated using the average closing share price for the three months ended 31 December 2024. See page 124.
The following sections provide further detail on the figures in the above table, including the underlying calculations and assumptions and
the Committee’s performance assessments for variable remuneration.
The Annual bonus section is set out from page 120 and the Long-term incentives section from page 124. Information about the Executive
Directors’ remuneration arrangements for the coming year, ending 31 December 2025, is highlighted in grey boxes.
Planned implementation for 2025
Content contained within a grey box
indicates planned implementation for 2025.
Audited
Audited information
Content contained within the Audited
panel indicates that all the information
within has been subject to audit.
Key:
Corporate Governance
Additional Information
Financial Statements
Strategic Report
119
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Directors’ Remuneration Report
Annual Report on Remuneration
Annual bonus
2024 Annual bonus
Annual bonuses earned in respect of
performance during 2024 are included
in the realised pay table.
Detailed information on the Committee’s
approach to target setting and assessment
of performance is set out from page 121.
Half of the Executive Directors’ pre-tax
bonus is compulsorily deferred into
Ordinary Shares which are released three
years from the date of deferral. Bonuses
are not pensionable.
Taxable benefits
The totals within taxable benefits include
the CEO’s allowance under AstraZeneca’s
UK Flexible Benefits Programme, under
which he can select benefits or take his
allowance, or any proportion remaining after
the selection of benefits, in cash (£118,156
taken as cash). In 2024, benefits included
additional healthcare/death in service
insurance, as well as personal tax advice.
The value of this personal tax advice
provided to each Executive Director in 2024
was £14,542 and £12,105 for the CEO and
CFO respectively.
Fixed remuneration
Base pay
When awarding base pay increases, the
Committee considers, among other factors,
base pay increases applied across the UK
employee population. The increase to
current Executive Directors’ base pay for
2025 will be in line with the UK all-employee
base pay budget at 4%.
Pension
The Executive Directors receive a pension
allowance of 11% of base pay, in line with
the wider UK workforce. During 2024, the
Executive Directors took their pension
allowance as a cash alternative to
participation in a defined contribution
pension scheme. Neither of the Executive
Directors has a prospective entitlement
to a defined benefit pension by reason
of qualifying service.
Audited
Audited
Audited
Audited
Annual bonus in respect of performance during 2024
Bonus potential
as % of base pay
Bonus
payable in
cash
Bonus
deferred into
shares
Total bonus
awarded
£’000
Target
Maximum
Pascal Soriot
150%
300%
1,749
1,750
3,499
78.5% max
Aradhana Sarin
100%
200%
747
747
1,494
78.5% max
2024
2025
£’000
Total taxable
benefits
Taxable
benefits
Pascal Soriot
138
In line with
2024
Aradhana Sarin
14
In line with
2024
2024
2025
£’000
Change
from 2023
Base
pay
Change
from 2024
Base
pay
Pascal Soriot
4%
1,486
4%
1,545
Aradhana Sarin
4%
951
4%
990
2024
2025
£’000
Pensionable
base pay
Pension
allowance
Cash in lieu
of pension
Pension
allowance
Pascal Soriot
1,486
11% of
base pay
163
11% of
base pay
Aradhana Sarin
951
11% of
base pay
105
11% of
base pay
Corporate Governance
120
AstraZeneca
Annual Report & Form 20-F Information 2024
Annual Report on Remuneration
continued
2024 Group scorecard assessment
Performance against the 2024 Group scorecard is set out below.
The Group scorecard is used in the determination of bonus payouts for all AstraZeneca employees. Each metric within the scorecard is
assessed on a standalone basis and has a defined payout range.
Performance below the specified threshold level for a metric will result in 0% payout for that metric. 100% of target bonus will pay out for
on-target performance, and 200% of target bonus will pay out for performance at or above maximum. Performance between threshold and
maximum is assessed on a pro rata basis. Maximum bonus payouts for the CEO and CFO for 2024 were capped at 300% and 200% of base
pay respectively. The payout range for each metric is capped in line with each Executive Director’s maximum bonus opportunity to ensure
underperformance against one metric cannot be compensated for by overachievement against another. The table below shows the
scorecard formulaic outcomes for the CEO and CFO as a percentage of target bonus.
2024 Group scorecard performance measures and metrics
Weighting
Threshold
(0% payout)
Target
(100% payout)
Maximum
(200% payout)
Outcome
Formulaic outcome
(% of target bonus)
Science and Innovation measures
Science and Innovation: Annual pipeline progression
Pipeline progression events
15%
14
27
41
24
12%
Regulatory events
15%
29
42
55
52
27%
Subtotal – Science and Innovation measures
30%
39%
Financial measures
Growth and Therapy Area Leadership
Total Revenue ($bn)
30%
50.5
52.1
53.7
53.8
60%
Achieve Group Financial Targets
Cash flow ($bn)
20%
8.7
10.2
11.7
10.1
18%
Core EPS ($)
20%
7.43
7.82
8.21
8.22
40%
Subtotal – Financial measures
70%
118%
Total
100%
157%
Key:
Bar charts are indicative of 2024 performance; scales do not start from zero.
Due to rounding, the total formulaic outcome differs from the arithmetic total of the individual metric outcomes disclosed above.
Pipeline progression events include Phase II starts and progressions, and NME and life-cycle management (LCM) positive pivotal trial
investment decisions. Regulatory events include NME and major LCM regional submissions and approvals. Further detail on our Science
and Innovation strategic priority and these events is included from page 12 of this Annual Report.
Annual bonus
continued
Audited
Corporate Governance
Additional Information
Financial Statements
Strategic Report
121
AstraZeneca
Annual Report & Form 20-F Information 2024
Directors’ Remuneration Report
In 2024, the Growth and Therapy Area Leadership measure was based on Total Revenue. The Total Revenue and Core EPS measures are
both set and evaluated at budget exchange rates at the beginning of the year and evaluated at those rates at the end of the performance
period, so that any beneficial or adverse movements in currency, which are outside the Company’s control, do not impact reward
outcomes. The Cash flow measure is set and evaluated at the actual exchange rate and is evaluated by reference to net cash flow from
operating activities less capital expenditure, adding back proceeds from disposal of intangible assets, to be fully transparent with all
elements easily derived from the Group IFRS Cash Flow Statement.
Overall assessment
During 2024, the Executive Directors’ individual performance was assessed in the following key areas which align with the Company’s objectives.
Pascal Soriot
Despite an increasingly volatile environment globally, Mr Soriot has led AstraZeneca to deliver strong results in 2024, with another year of robust top line
growth and impressive results from the pipeline. In addition, the Committee considered Mr Soriot’s leadership across other dimensions of performance:
Demonstrating
leadership to support
developments in global
life sciences
Mr Soriot has continued to champion and shape groundbreaking scientific innovation, the sustainable development of healthcare
and health education, and to further strengthen AstraZeneca’s growth. He has achieved this through multiple engagements with
a diverse audience of government officials globally including leaders from the UK, the US, China and Singapore; along with
attending many leading scientific congresses and societies. He also continues to chair the SMI Health Systems Task Force,
engaging with HM King Charles III and global CEOs from multiple sectors.
Leading in
Environmental, Social &
Governance (ESG)
performance
Mr Soriot continues to ensure that AstraZeneca’s name is synonymous with sustainability and purposefully drives the Company
to lead in the efforts of climate action and decarbonisation.
Under Mr Soriot’s leadership, the Södertälje, Sweden operations site reached the milestone of reducing its Scope 1 and Scope 2
greenhouse gas emissions by over 98% compared with the 2015 baseline. AstraZeneca also saw the completion of the clinical
program to support the first regulatory filings for the transition of inhaled medicines to an innovative, next generation propellant
with 99.9% lower global warming potential than propellant used in currently available inhaled medicines.
The Healthy Heart Africa programme surpassed its ambition by identifying 12.5 million people with elevated blood pressure and
has now successfully conducted more than 63 million blood pressure screenings, and activated more than 1,500 facilities across
nine countries in Sub-Saharan Africa.
The Company retained its EcoVadis Gold Medal ranking for the second year placing AstraZeneca in the top three percent of
companies evaluated, was included in TIME Best Companies 2024 for sustainability transparency, and the Financial Times and
Statista’s list of Europe Climate leaders 2024.
Making AstraZeneca a
Great Place to Work
Mr Soriot has ensured that inclusion and diversity (I&D) is embedded as part of the culture at AstraZeneca, with a determination to
provide an environment which fosters innovation and collaboration. I&D priorities focus on psychological safety, inclusive
leadership at all levels, pay equity education, sponsorship and mentoring programmes.
Progress has been recognised externally in 2024 by Forbes World’s Top Companies for Women, Forbes World’s Best Employers,
TIME World’s Best Companies and the 2025 Financial Times Diversity Leaders awards.
Mr Soriot has continued to champion a culture of learning and growth across the business, sponsoring a range of offerings that
enable employees to perform, grow, adapt and belong. Key investments over the year include “Leading our Future”, a new custom
built leadership offering for middle and senior leaders, ”Leading Ambition”, a programme for our Executives; “Manager in Action”
which is a new flexible learning journey supporting all Line Managers; and the Company’s bespoke generative AI accreditation
programme, which supports all employees to build the confidence, knowledge and experience of using AI tools.
Annual bonus
continued
Audited
Corporate Governance
122
AstraZeneca
Annual Report & Form 20-F Information 2024
Annual Report on Remuneration
continued
Aradhana Sarin
Over 2024 Dr Sarin has focussed on fostering a high-performance culture whilst driving productivity and empowering change.
Performance delivery
Guided by Dr Sarin’s leadership, the Finance function delivered another year of strong performance. She has successfully led
the refinancing of debt at attractive rates and overseen significant investment in Capex. Dr Sarin remains closely involved with
business development teams, and over 2024 has provided guidance for negotiations, and also post-acquisition integration and
risk management for acquisitions including Gracell, Icosavax and Fusion.
Building a Finance
function of the future
Dr Sarin has spearheaded significant steps in the development of technology within the Finance function including systems for
tax forecasting and improvements to ensure compliance with digital tax laws.
Dr Sarin has been an advocate for implementing the use of AI across the Company and has encouraged the upskilling of the
entire Finance function and the wider enterprise, on AI use. Greater standardisation is being driven by automation. The Global
Business Service (GBS) function continues to transform and drive significant efficiencies. GBS delivered annual savings of more
than $45 million over 2024 by strategically insourcing from third party providers and improving productivity, and also expanding
their global footprint in some of our new strategic hubs. They also developed and implemented innovative process solutions such
as process mining, resulting in freeing up approximately 250,000 hours allowing the enterprise to operate more efficiently and
focus on high value activities.
Axial
Throughout 2024 Dr Sarin has overseen the launch of the Axial programme, under which the enterprise will adopt the S/4HANA
platform, transitioning seven Enterprise Resource Planning (ERP) systems into one. This impactful programme is on track to
transform the way we work across the entire financial management and supply chain, removing complexity, standardise ways
of working and simplify processes. In 2024, the project team became fully operational, a detailed plan was created, and data
organisation and cleanse activities progressed to strengthen our data foundations and set the programme up for long term success.
Great Place to Work
Dr Sarin has supported the effort to unify multiple women’s forums across the enterprise into one global Network of Women,
launching chapters in Ireland, Sweden, Dubai and other regions. Over 2024 she continued to host a well-received podcast series
called “In Conversation with”, that features informal conversations with high-profile female leaders in business. She is also the
Executive sponsor of AstraZeneca’s Asian Employee Resource Group.
Audited
Final determination of Executive Directors’ bonuses
In determining the annual bonus outturn for Executive Directors, the Committee considers the formulaic Group scorecard outcome,
as well as the overall business performance, shareholder experience and the personal contribution of the individual Executive Director.
A description of the Executive Directors’ personal achievements is detailed above.
Given the contributions made by both Mr Soriot and Dr Sarin in 2024 as outlined above, the Committee determined the bonus outturns for
both Executive Directors should be 157% of target (or 78.5% of maximum), in line with the formulaic Group scorecard outcome.
Deferred Bonus Plan
Half of each Executive Director’s pre-tax annual bonus is ordinarily deferred under the Deferred Bonus Plan (DBP). In respect of the bonus
deferred, the Executive Director is granted a conditional award over shares. No further conditions apply to DBP shares. One half of the
bonus earned in respect of performance during 2023 was deferred and details of the consequent DBP awards granted in 2024 are shown
below. One half of the Executive Directors’ bonus earned in respect of performance during 2024 has been deferred and the consequent
DBP awards are expected to be granted in March 2025.
Audited
2024 Grant
1
2025 Grant
Ordinary Shares
granted
Grant date
Grant price
(pence per share)
2
Face value
£’000
2024 Bonus deferred
£’000
Pascal Soriot
14,081
4 March 2024
10081
1,420
1,750
Aradhana Sarin
7,214
4 March 2024
10081
728
747
1
One half of the bonus earned in respect of performance during 2023 was deferred into shares, with the consequent DBP awards granted in 2024.
2
The grant price is the average closing share price over the three dealing days preceding grant.
2025 Group scorecard performance measures and metrics
Measure weighting
Underlying metrics (if applicable)
Metric weighting
2025 target
Science and Innovation: Annual pipeline progression
30%
Pipeline progression events
15%
C
Regulatory events
15%
C
Growth and Therapy Area Leadership
30%
Total Revenue
30%
C
Achieve Group Financial Targets
40%
Cash flow
20%
C
Core EPS
20%
C
Key:
Target increased vs 2024 target
Target decreased vs 2024 target
Target constant
C
Commercially sensitive
Annual bonus
continued
Audited
Corporate Governance
Additional Information
Financial Statements
Strategic Report
123
AstraZeneca
Annual Report & Form 20-F Information 2024
Directors’ Remuneration Report
Long-term incentives included in the Executive Directors’ realised pay for 2024 figure: 2022 PSP
The Executive Directors’ realised pay for 2024 includes the value of PSP awards with performance period ended 31 December 2024.
These shares and dividend equivalents will not be released to the Executive Directors until the awards vest at the end of the holding period.
The value of the shares due to vest has been calculated using the average closing share price over the three-month period ended
31 December 2024 (10868 pence). The table below provides a breakdown showing the face value of these shares at the time they were
granted, the value that is attributable to share price appreciation since grant, and the value of dividend equivalents accrued on these shares
over the relevant performance period. Further information about the individual awards and performance assessments follows the table.
Audited
Long-term incentive awards with performance periods ended 31 December 2024
Value of shares due to vest
Ordinary Shares
granted
Performance
outcome
Face value
at time
of grant
1
£’000
Value due to
share price
appreciation
2
£’000
Dividend equivalent
accrued over
performance period
£’000
Long-term
incentives total
£’000
Pascal Soriot
2022 PSP
97,066
84%
7,464
1,398
580
9,442
Aradhana Sarin
2022 PSP
43,038
84%
3,309
620
258
4,187
1
Calculated using the grant price of 9154 pence, being the average closing share price over the three dealing days preceding the grant of the 2022 PSP awards.
2
Calculated using the difference between the grant price and the average closing share price over the three-month period ended 31 December 2024. The average closing share
price over the three-month period ended 31 December 2024 was 10868 pence.
The 2022 PSP awards granted to Mr Soriot and Dr Sarin on 4 March 2022, are due to vest and be released on 4 March 2027 on completion
of a further two-year holding period. Performance over the period from 1 January 2022 to 31 December 2024 will result in 84% of the
awards vesting, based on the following assessment of performance.
Annual bonus
continued
Long-term incentives
We intend to disclose the 2025 Group scorecard outcome and details of the performance hurdles and targets in the 2025 Directors’
Remuneration Report following the end of the performance period. The performance targets are currently considered to be commercially
sensitive as prospective disclosure may prejudice the Company’s commercial interests. Executive Directors’ individual contribution will
be assessed by reference to individual goals in line with the Company’s objectives for the year.
Audited
Corporate Governance
124
AstraZeneca
Annual Report & Form 20-F Information 2024
Annual Report on Remuneration
continued
The Growth and Therapy Area Leadership
target (measuring Total Revenue) is set at
budget exchange rates at the beginning of
the performance period and evaluated at
those rates at the end of the performance
period, so that any beneficial or adverse
movements in currency, which are outside
the Company’s control, do not impact
reward outcomes.
The Cash flow measure is assessed using
cumulative net cash flow from operating
activities less capital expenditure,
adding back proceeds from the disposal
of intangible assets.
The 2022 PSP sustainability metric focused
on reduction in Scope 1 and Scope 2 GHG
emissions glide path (Ambition Zero
Carbon). For more information about the
Company’s sustainability initiatives,
including Ambition Zero Carbon see Climate
change from page 53.
AstraZeneca ranked tenth within the TSR
peer group. The TSR peer group for the
2022 PSP consisted of AbbVie, Amgen,
Astellas, BMS, Daiichi Sankyo, Eli Lilly,
Gilead, GSK, Johnson & Johnson, Merck
KGaA, Moderna, MSD, Novartis, Novo
Nordisk, Pfizer, Roche, Sanofi and Takeda.
PSP awards granted during 2024
During 2024, conditional awards of shares were granted to the Executive Directors with face values equivalent to 850% of base pay for
Mr Soriot and 550% of base pay for Dr Sarin under the PSP. Face value is calculated using the grant price, being the average closing share
price over the three dealing days preceding grant. Following the approval of the Policy at the 2024 AGM, the 13 May 2024 grant was made
at the same share price as the 4 March 2024 grant.
Performance will be assessed over the period from 1 January 2024 to 31 December 2026 against the measures outlined below to determine
the proportion of the award that vests. A further two-year holding period will then apply before vesting, which is scheduled to occur on the
fifth anniversary of grant.
Ordinary
Shares
granted
Grant
date
Grant price
(pence per
share)
Face value
£’000
End of
performance period
End of
holding period
Pascal Soriot
95,791
4 March 2024
10081
9,657
31 December 2026
4 March 2029
Pascal Soriot
1
29,474
13 May 2024
10081
2,971
31 December 2026
13 May 2029
Aradhana Sarin
51,911
4 March 2024
10081
5,233
31 December 2026
4 March 2029
1
This award forms part of the PSP award granted to Mr Soriot on 4 March 2024 and was made to take account of the revised limits for the PSP approved by shareholders at the
Company’s 2024 AGM.
The 2024 PSP performance measures focus on scientific, ESG, commercial and financial performance over the three-year performance
period. The five performance metrics attached to the 2024 PSP awards are detailed below. Twenty per cent of the award will vest if the
threshold level of performance is achieved; the maximum level of performance must be achieved under each measure for 100% of the
award to vest.
Relative total shareholder return (TSR) (20% of award
)
TSR performance is assessed against a predetermined peer group of global pharmaceutical companies and consists of AbbVie, Amgen,
Astellas, BMS, Daiichi Sankyo, Eli Lilly, Gilead, GSK, Johnson & Johnson, Merck KGaA, Moderna, MSD, Novartis, Novo Nordisk, Pfizer,
Roche, Sanofi and Takeda. The rank which the Company’s TSR achieves over the performance period will determine how many shares
will vest under this measure.
TSR ranking of the Company
% of award that vests
Median
20% (threshold for payout)
Between median and upper quartile
Pro rata
Upper quartile
100%
Long-term incentives
continued
Audited
2022 PSP performance measures
and metrics
Outcome
Payout
Science and Innovation:
First approvals and NME
volume over three years
NME Phase III/registrational volume
12%
7
14
19
12%
Regulatory events
18%
14
28
28
18%
Subtotal – Science and Innovation
1
30%
30%
Growth and Therapy Area
Leadership ($bn)
20%
40.5
47.5
59.5
20%
Cash flow ($bn)
20%
20.0
28.5
28.5
20%
Total shareholder return
20%
Median
UQ
2
10th
4%
Ambition Zero Carbon
10%
207 ktCO
2
e
155 ktCO
2
e
140ktCO
2
e
10%
Total
1
100%
84%
Key:
Bar charts are indicative of 2022 PSP performance; scales do not start from zero.
Due to rounding, the total outcome differs from the arithmetic total of the individual metric outcomes disclosed above.
1
The subtotal and total reflect the weightings of the individual metrics.
2
UQ = Upper Quartile.
Weighting
Maximum
(100%
vesting)
Threshold
(20%
vesting)
Corporate Governance
Additional Information
Financial Statements
Strategic Report
125
AstraZeneca
Annual Report & Form 20-F Information 2024
Directors’ Remuneration Report
Net Cash flow (20% of award)
The Cash flow measure is assessed using cumulative net cash flow from operating activities less capital expenditure adding back
proceeds from the disposal of intangible assets. The level of vesting under this measure is based on a scale between a threshold target
and an upper target.
Cash flow
% of award that vests
$23.0bn
20% (threshold for payout)
Between $23.0bn and $28.0bn
Pro rata
$28.0bn
75%
Between $28.0bn and $33.0bn
Pro rata
$33.0bn and above
100%
Growth and Therapy Area Leadership (20% of award)
For PSP awards granted in 2024, the Growth and Therapy Area Leadership metric is Total Revenue. Disclosing the threshold and maximum
hurdles for this measure could be construed to constitute financial guidance, which is not the Company’s intention. The Growth and
Therapy Area Leadership (Total Revenue) measure is thus considered to be commercially sensitive and will be disclosed following the end
of the performance period, in the 2026 Directors’ Remuneration Report. This measure is evaluated by reference to budget exchange rates.
Science and Innovation: First approvals and NME volume over three years (30% of award)
Performance is assessed using dual indices which measure NME Phase III/registrational volume and regulatory events, allowing disclosure
of targets at the beginning of the performance period.
NME Phase III/registrational volume
(12% of award)
% of award that vests
Regulatory events (18% of award)
% of award that vests
14
20% (threshold for payout)
16
20% (threshold for payout)
Between 14 and 21
Pro rata
Between 16 and 24
Pro rata
21
75%
24
75%
Between 21 and 28
Pro rata
Between 24 and 32
Pro rata
28
100%
32
100%
Ambition Zero Carbon (10% of award)
For the 2024 PSP, this measure reflects the importance of eliminating GHG emissions from our Scope 1 and Scope 2 operations through
2026. Reductions are measured against our 2015 baseline, and calculated in line with the World Resources Institute/World Business
Council for Sustainable Development GHG Protocol methodology for accounting and reporting of our emissions footprint.
Emissions
% of award that vests
26 ktCO
2
e
20% (threshold for payout)
Between 26 ktCO
2
e and 19 ktCO
2
e
Pro rata
19 ktCO
2
e
75%
Between 19 ktCO
2
e and 13 ktCO
2
e
Pro rata
13 ktCO
2
e and below
100%
Long-term incentives
continued
Audited
Corporate Governance
126
AstraZeneca
Annual Report & Form 20-F Information 2024
Annual Report on Remuneration
continued
PSP performance measures for 2025 grant
The sustainability measure within the 2025 PSP has been updated as set out below. All other measures remain unchanged from the 2024
PSP award.
PSP performance measure
Measure weighting
Underlying metrics (if applicable)
Metric
weighting
Threshold
(20%
vesting)
Maximum
(100%
vesting)
Science and Innovation:
First approvals and NME
volume over three years
30%
NME Phase III/registrational volume
12%
14
28
Regulatory events
18%
18
35
Growth and
Therapy Area Leadership
20%
Total Revenue
Commercially sensitive
until end of
performance period
Cash flow
20%
$27.5bn
$35.5bn
Relative TSR
20%
Median
Upper
Quartile
Sustainability
10%
Value Chain emissions (Scope 3)
1,846
ktCO
2
e
1,434
ktCO
2
e
Regulatory events measure NME and major life-cycle management approvals (taking into account the first approval over the
performance period). NME Phase III/registrational volume measures the total NME pipeline volume at the end of the performance period.
These two items ensure that management is assessed on both R&D late-stage delivery (approvals) and also future pipeline
sustainability (volume).
Disclosing the threshold and maximum hurdles for the Growth and Therapy Area Leadership (Total Revenue) measure could be
construed to constitute financial guidance, which is not the Company’s intention. The Total Revenue measure is thus considered to be
commercially sensitive and will be disclosed following the end of the performance period.
The Total Revenue measure is evaluated by reference to budget exchange rates such that beneficial or adverse movements in currency,
which are outside the Company’s control, do not impact reward outcomes. The companies in the TSR comparator group are shown on
page 125.
The Cash flow measure is assessed using cumulative net cash flow from operating activities less capital expenditure adding back
proceeds from the disposal of intangible assets. Capital expenditure is expected to increase significantly during the performance period,
driven by investment in several major manufacturing capabilities such as active pharmaceutical ingredients, inhaled products,
monoclonal antibodies, antibody drug conjugates and cell therapy.
As we reach the end of our Scope 1 and Scope 2 GHG emission glide path, our 2025 sustainability metric, Ambition Zero Carbon, will
focus on value chain (Scope 3) GHG emissions and aggregate reductions from the next-generation propellant transition, primary
distribution and business travel, which represent approximately 25% of our 2024 value chain (Scope 3) GHG emissions. For more
information on Ambition Zero Carbon, see Climate change from page 53.
As described on page 118, the Committee takes into account a wide range of data to ensure that the stretching nature of PSP hurdles is
robustly tested and that financial targets are aligned with the Company’s Mid-Term Plan. The Committee takes consensus and exchange
rates into account when determining the appropriate level of stretch relative to prior plans and performance outturns.
PSP awards are expected to be granted to the Executive Directors in March 2025. The PSP award to be granted to Mr Soriot will be
equivalent to 850% of base pay. The PSP award to be granted to Dr Sarin will be equivalent to 550% of base pay.
Long-term incentives
continued
For more information about
How our performance
measures for 2025 support the
delivery of our strategy, and
How the Remuneration
Committee ensures targets are
stretching, see pages 117
and 118, respectively.
Corporate Governance
Additional Information
Financial Statements
Strategic Report
127
AstraZeneca
Annual Report & Form 20-F Information 2024
Directors’ Remuneration Report
Non-Executive Directors’ realised pay for 2024 (single total figure of remuneration)
The table sets out all elements of remuneration receivable by the Non-Executive Directors in respect of the year ended 31 December 2024,
alongside comparative figures for the prior year.
2024
Fees
£’000
2023
Fees
£’000
2024
Other
£’000
2023
Other
£’000
2024
Total
£’000
2023
Total
£’000
Michel Demaré
1
800
584
–
–
800
584
Euan Ashley
160
119
–
–
160
119
Philip Broadley
233
200
–
–
233
200
Deborah DiSanzo
140
120
–
–
140
120
Diana Layfield
135
110
–
–
135
110
Anna Manz
2
140
40
–
–
140
40
Sheri McCoy
205
175
–
–
205
175
Tony Mok
135
110
–
–
135
110
Nazneen Rahman
200
160
–
–
200
160
Andreas Rummelt
135
110
–
–
135
110
Marcus Wallenberg
155
125
–
–
155
125
Former Non-Executive Directors
Leif Johansson
3
–
203
–
22
–
225
Total
2,438
2,056
–
22
2,438
2,078
1
Michel Demaré was appointed Chair of the Board from 27 April 2023.
2
Anna Manz was appointed as a Non-Executive Director and member of the Audit Committee on 1 September 2023.
3
Leif Johansson retired from the Board on 27 April 2023. Mr Johansson’s single total figure includes office costs (invoiced in Swedish kronor) of £21,955 for the period in 2023
during which he was Chair of the Board.
Non-Executive Directors’ fee structure
The Non-Executive Directors’ fees effective from January 2025 are set out in the table below, alongside the fees applicable during 2024.
Fees for the Non-Executive Directors (other than the Chair of the Board) were determined by the Chair of the Board and the Executive
Directors. Changes to the Chair of the Board’s fee were determined by the Remuneration Committee, excluding the Chair of the Board.
No Board member participated in any decisions relating to their own fees.
From December 2024, the fee structure will be reviewed annually, but not necessarily increased. The Chair’s fee was last reviewed in July
2022 and increased with effect from May 2023. Certain of the other Non-Executive Directors’ fees were last increased in January 2024.
In the latest review, the size and complexity of the AstraZeneca Group was considered, together with the continuing increase in workload,
responsibilities, and time commitment for non-executive directors of global, publicly listed companies, in part driven by changes in the
corporate governance and regulatory landscape in multiple jurisdictions. Independent market data from FTSE 30 and FTSE 10 companies
was also reviewed to ensure that AstraZeneca’s fees do not hinder the recruitment of Directors of the right experience and calibre for a
Group of our scale in a global market.
With effect from January 2025, the Chair’s fee has been increased from £800,000 to £890,000 and the Company will reimburse the
Chair’s reasonable office costs up to £75,000 per annum. Other increases have been made to the basic Non-Executive Director fee, the
senior independent Non-Executive Director’s fee, the Chairs’ fees for the Audit and Remuneration Committees, as well as the fees for
membership of the Audit, Remuneration, Sustainability and Science Committee. A fee has also been introduced for membership of the
Nomination and Governance Committee, in line with market practice and reflecting its important role in succession planning. No fee has
been introduced for the Chair of the Nomination and Governance Committee.
Non-Executive Director fees
2024
£’000
2025
£’000
Chair of the Board
1
800
890
Basic Non-Executive Director
115
120
Senior independent Non-Executive Director
48
50
Chair of the Audit Committee
2
50
55
Member of the Audit Committee
25
27.5
Chair of the Remuneration Committee
2
45
50
Member of the Remuneration Committee
20
25
Chair of the Sustainability Committee
2
45
45
Member of the Sustainability Committee
20
22.5
Chair of the Science Committee
2
45
50
Member of the Science Committee
20
25
Chair of the Nomination and Governance Committee
–
–
Member of the Nomination and Governance Committee
–
17.5
1
The Chair of the Board does not receive any additional fees for chairing, or being a member of a Committee.
2
The Committee Chairs do not receive additional fees for being a member of the Committee.
Non-Executive Directors’ remuneration
Audited
Corporate Governance
128
AstraZeneca
Annual Report & Form 20-F Information 2024
Annual Report on Remuneration
continued
Minimum shareholding requirements
The CEO and CFO are each required to build a shareholding to satisfy their respective minimum shareholding requirements (MSR), each
within five years of their dates of appointment or, if the MSR is increased at any time, within five years of that increase. Following approval
of the Policy at the 2024 AGM, the minimum shareholder requirements for the Executive Directors was increased to match their variable
pay opportunity, being 1,150% of base pay for Mr Soriot (increased from 650%), and 750% of base pay for Dr Sarin (increased from 450%).
The Executive Directors have five years from 11 April 2024, when the Policy was approved, to meet this requirement.
Shares that count towards the MSR are shares beneficially held by the Executive Director and their connected persons and share awards
that are not subject to further performance conditions. Share awards included are DBP shares in deferral periods, and PSP shares in
holding periods, on a net-of-tax basis. The value is calculated using the closing share price on 31 December 2024.
As at 31 December 2024, Dr Sarin exceeded her increased minimum shareholding requirement and Mr Soriot’s holding was slightly below
the increased MSR but above his previous MSR of 650%. 50% of Mr Soriot’s 2024 annual bonus will be deferred into shares and 84% of
Mr Soriot’s 2022 PSP award will move into a two-year holding period, following completion of the performance period on 31 December
2024. These shares will count towards Mr Soriot’s MSR in 2025.
A further post-employment shareholding requirement applies to Executive Directors. For two years following cessation of employment,
Executive Directors are required to hold shares to the value of the shareholding requirement that applied at the cessation of their
employment; or, in cases where the individual has not had sufficient time to build up shares to meet their guideline, the actual level of
shareholding at cessation. The post-cessation requirement will be maintained through self-certification, with the Committee keeping this
approach under review.
Position against the 2024 minimum shareholding requirement (MSR) as a percentage of base pay
Beneficially owned
shares and shares in
a holding period
1
Shares in
deferral period
2
Shares subject
to performance
conditions
Value of shares
counted towards
MSR as a % of
base pay
3
Pascal Soriot
224,116
45,745
308,139
1,021%
Aradhana Sarin
99,498
17,866
132,996
1,099%
1
Holding period shares included are those which are not subject to continued employment.
2
Shares in deferral periods which are not subject to continued employment.
3
Holding as at 31 December 2024. Shares subject to deferral and holding periods calculated net of a theoretical
50% tax rate. Shares subject to performance conditions are not included in the value of shares counted towards MSR.
Non-Executive Directors are encouraged to build up, over a period of three years, a shareholding in the Company with a value
approximately equivalent to the basic annual fee for a Non-Executive Director (which was increased to £115,000 during 2024) or, in the
case of the Chair, approximately equivalent to his basic annual fee (£800,000 during 2024). The majority of Non-Executive Directors who
had served for a period of three years or more as at 31 December 2024 met this expectation, based on the three-month average closing
share price for the period ended 31 December 2024 (10868 pence).
Audited
Directors’ interests as at 31 December 2024
The following table shows the beneficial interests of the Directors (including the interests of their connected persons) in Ordinary Shares as
at 31 December 2024.
Executive Directors
Beneficial interest in
Ordinary Shares at
31 December 2024
1
Beneficial interest in
Ordinary Shares at
31 December 2023
1
Pascal Soriot
269,861
363,489
Aradhana Sarin
117,364
82,514
Non-Executive Directors
Michel Demaré
2
10,000
6,000
Euan Ashley
1,545
1,150
Philip Broadley
8,025
7,045
Deborah DiSanzo
1,000
1,000
Diana Layfield
1,400
1,400
Anna Manz
3
487
487
Sheri McCoy
1,736
1,736
Tony Mok
3,500
2,000
Nazneen Rahman
1,017
1,017
Andreas Rummelt
27,205
27,205
Marcus Wallenberg
60,028
60,028
1
For the Executive Directors, beneficial interests include shares in holding periods and deferral periods which are not subject to performance measures or continued employment.
Shares in a holding or deferral period are included on a gross basis.
2
Michel Demaré was appointed Chair of the Board on 27 April 2023.
3
Anna Manz was appointed on 1 September 2023.
1,150%
1,021%
750%
1,099%
CEO
CFO
Key:
2024 MSR
Shares counted towards MSR
Directors’ shareholdings
Audited
Corporate Governance
Additional Information
Financial Statements
Strategic Report
129
AstraZeneca
Annual Report & Form 20-F Information 2024
Directors’ Remuneration Report
Executive Directors’ share plan interests
The following tables set out the Executive Directors’ interests in Ordinary Shares under the Company’s share plans.
Pascal Soriot
Shares outstanding at
31 December 2024
Share scheme interests
Grant date
Shares
outstanding at
1 January
2024
Grant
price
(pence)
Shares
granted
in year
Shares
released
in year
Shares
lapsed
in year
Shares
subject to
performance
Shares
in deferral/
holding
period
1
Performance
period end
Vesting and
release date
DBP
05/03/2021
16,944
6844
–
16,944
–
n/a
–
n/a
05/03/2024
2,3
04/03/2022
17,216
9154
–
–
–
n/a
17,216
n/a
04/03/2025
04/03/2023
14,448
10821
–
–
–
n/a
14,448
n/a
04/03/2026
04/03/2024
–
10081
14,081
–
–
n/a
14,081
n/a
04/03/2027
4
PSP
08/03/2019
97,351
6287
–
97,351
–
–
–
31/12/2021
08/03/2024
5,6
06/03/2020
84,725
7376
–
–
–
–
84,725
31/12/2022
06/03/2025
21/05/2020
8,471
7376
–
–
–
–
8,471
31/12/2022
21/05/2025
05/03/2021
106,655
6844
–
–
(12,799)
–
93,856
31/12/2023
05/03/2026
7
14/05/2021
19,391
6844
–
–
(2,327)
–
17,064
31/12/2023
14/05/2026
7
04/03/2022
97,066
9154
–
–
–
97,066
–
31/12/2024
04/03/2027
04/03/2023
85,808
10821
–
–
–
85,808
–
31/12/2025
04/03/2028
04/03/2024
–
10081
95,791
–
–
95,791
–
31/12/2026
04/03/2029
8
13/05/2024
–
10081
29,474
–
–
29,474
–
31/12/2026
13/05/2029
8
AZIP
24/03/2016
10,809
3923
–
10,809
–
–
–
31/12/2019
01/01/2024
9,10
Total
558,884
139,346
125,104
(15,126)
308,139
249,861
1
Shares in deferral/holding period are not subject to performance conditions.
2
Market price on 5 March 2024, the actual date of release, was 10112 pence.
3
An additional 1,171 Ordinary Shares were released as a result of the reinvestment of dividend equivalents accrued during the deferral period.
4
Award granted following deferral of one half of the annual bonus earned in respect of performance during 2023, see page 123 for further detail.
5
Market price on 8 March 2024, the actual date of release, was 10196 pence.
6
An additional 11,866 Ordinary Shares were released as a result of the reinvestment of dividend equivalents accrued during the performance and holding period.
7
88% of the shares entered the holding period, following assessment of performance over the period to 31 December 2023. The remaining shares lapsed.
8
Details of PSP awards granted during 2024 are shown on page 125.
9
Market price on 20 February 2024, the actual date of release, was 10204 pence.
10
An additional 2,223 Ordinary Shares were released as a result of the reinvestment of dividend equivalents accrued during the performance and holding period.
Aradhana Sarin
Shares outstanding at
31 December 2024
Share scheme interests
Grant
date
Shares
outstanding at
1 January
2024
Grant
price
(pence)
Shares
granted
in year
Shares
released
in year
Shares
lapsed
in year
Shares
subject to
performance
Shares
in deferral/
holding
period
1
Performance
period end
Vesting and
release date
DBP
04/03/2022
3,249
9154
–
–
–
n/a
3,249
n/a
04/03/2025
04/03/2023
7,403
10821
–
–
–
n/a
7,403
n/a
04/03/2026
04/03/2024
–
10081
7,214
–
–
n/a
7,214
n/a
04/03/2027
2
PSP
13/08/2021
19,414
8209
–
–
(2,330)
–
17,084
31/12/2023
13/08/2026
3
04/03/2022
43,038
9154
–
–
–
43,038
– 31/12/2024
04/03/2027
04/03/2023
38,046
10821
–
–
–
38,046
– 31/12/2025
04/03/2028
04/03/2024
–
10081
51,911
–
–
51,911
– 31/12/2026
04/03/2029
4
Total
111,150
59,125
–
(2,330)
132,995
34,950
1
Shares in deferral/holding period are not subject to performance conditions.
2
Award granted following deferral of one half of the annual bonus earned in respect of performance during 2023, see page 123 for further detail.
3
88% of the shares entered the holding period, following assessment of performance over the period to 31 December 2023. The remaining shares lapsed.
4
Details of PSP awards granted during 2024 are shown on page 125.
No Director or senior executive beneficially owns, or has options over, 1% or more of the issued share capital of the Company, nor do they
have different voting rights from other shareholders. None of the Directors has a beneficial interest in the shares of any of the Company’s
subsidiaries. Between 31 December 2024 and 6 February 2025, there was no change in the interests in Ordinary Shares for current
Directors shown in the table above.
Directors’ shareholdings
continued
Audited
Corporate Governance
130
AstraZeneca
Annual Report & Form 20-F Information 2024
Annual Report on Remuneration
continued
Audited
Payments to former Directors
During 2024, no payments were made to former Directors.
Payments for loss of office
During 2024, no payments were made to Directors for loss of office.
Remuneration in the wider context
In our Corporate Governance Report on page 98, we explain in detail how the Board has chosen to engage with AstraZeneca’s workforce,
and how important engagement with our employees is if we are to be a great place to work and continue to deliver outstanding performance.
The Directors believe that the Board as a whole should continue to take responsibility for gathering the views of the workforce. Consequently,
instead of implementing one of the three methods for workforce engagement prescribed in the 2018 UK Corporate Governance Code, the
Board chose to enhance and develop the long-standing channels of engagement which already exist in the organisation to ensure that the
Board continues to understand the global workforce’s views on a wide variety of topics, including matters relating to remuneration.
The Committee communicates with, and receives feedback from, employees through a variety of channels, including meetings with
high-potential employees and attending site visits, both virtually and in person. This allows the Committee to communicate with employees
on remuneration matters where appropriate. Committee members review wide-ranging data on reward across our global workforce, as well
as broader information on workforce trends and culture, which is also provided to the full Board. The Committee receives in-depth reports
throughout the year on colleague pay, benefits, incentives, performance management approach and broader talent policies at AstraZeneca
to ensure that the Committee is informed of wider workforce remuneration when making executive pay decisions. Decisions of the Committee
affecting employees, such as the annual Group scorecard outcomes, are shared with employees through internal communications as well
as through the Directors’ Remuneration Report. Additionally, we publish materials on executive remuneration and its implementation for
employees on our intranet site. In the event that more significant changes to workforce remuneration are proposed, active engagement
with employee representative groups provides feedback to help the Committee understand the impact upon the broader workforce.
When reviewing executive remuneration, the Committee takes into consideration our global workforce, looking to ensure the global total
reward offering is competitive, compelling and aligned to our business performance, while supporting a culture where everyone feels
valued and included, as outlined in the table on page 132. People and Sustainability is one of our three strategic priorities, and we explain
in our Business Review from page 32 the role that reward plays in developing an inclusive and diverse culture that encourages and rewards
innovation, entrepreneurship and performance. In carrying out its responsibilities and when setting the Policy, the Committee has taken
into account the principles of the UK Corporate Governance Code and the factors outlined within Provision 40 as described in the
table below.
Area
Our approach
Clarity
Remuneration arrangements should be transparent and
promote effective engagement with shareholders and
the workforce.
The Committee believes the remuneration structures under the Policy, and those for the wider
workforce as set out below, are clearly understood. The Committee regularly engages with
employees and shareholders and considers their feedback when reviewing the Directors’
Remuneration Policy and implementation.
Simplicity
Remuneration structures should avoid complexity and
their rationale and operation should be easy to
understand.
We operate a simple remuneration framework for our executives across both fixed and variable
pay which is, where possible, aligned with the wider workforce. The purpose, structure and
strategic alignment of each element of pay has been clearly laid out in our Directors’
Remuneration Policy.
Risk
Remuneration arrangements should ensure reputational
and other risks from excessive rewards, and behavioural
risks that can arise from target-based incentive plans,
are identified and mitigated.
We seek to ensure alignment with long-term shareholder interests and to mitigate any potential
risk through several mechanisms within our approach to executive remuneration. These include
the two-year holding period under the PSP on vesting, 50% mandatory deferral into shares for
three years for any annual bonus award, operation of malus and clawback provisions as
summarised in our Directors’ Remuneration Policy, and a shareholding requirement for two years
post-cessation of employment.
Predictability
The range of possible values of rewards to individual
directors and any other limits or discretions should be
identified and explained at the time of approving the
Policy.
The Committee set out under the Directors’ Remuneration Policy approved in April 2024 the
range of possible values under specific performance scenarios.
Proportionality
The link between individual awards, the delivery of
strategy and the long-term performance of the company
should be clear. Outcomes should not reward poor
performance.
As set out on page 118, the Committee follows a robust target-setting and assessment
process to ensure variable pay outcomes under the annual bonus and PSP are proportional to
our wider performance.
Our Directors’ Remuneration Policy operated as intended in terms of Company performance
and quantums during 2024, supporting the delivery of our strategy and another exceptional year
for AstraZeneca.
Corporate Governance
Additional Information
Financial Statements
Strategic Report
131
AstraZeneca
Annual Report & Form 20-F Information 2024
Directors’ Remuneration Report
Area
Our approach
Alignment to culture
Incentive schemes should drive behaviours consistent
with company purpose, values and strategy.
The Committee believes that the remuneration structures in place are aligned to the Company’s
performance culture and values and ensure the successful delivery of our strategy, with
alignment between strategy and reward set out on page 117. For example, alongside the formulaic
outcome, our annual bonus scheme for Executive Directors includes a holistic assessment of
their performance and broader ESG factors, further reinforcing the importance of our Purpose
and Values.
Element
Policy features for the wider workforce
Comparison with Executive Director
and Senior Executive Team remuneration
Base pay
Our base pay is the basis for a competitive total reward
package for all employees, and we review base pay annually.
This review takes account of country budget, relevant market
comparators, the skills, capabilities, knowledge and
experience of each individual, relative to peers within the
Company, and individual contribution.
In setting the budget each year, we consider affordability
as well as assessing how employee base pay is currently
positioned relative to inflation, market rates, forecasts of
any further market increases, and turnover.
The base pay of our Executive Directors and the Senior
Executive Team (SET) forms the basis of their total
remuneration, and we review their base pay annually.
The primary purpose of the review is to ensure base pay
remains competitive and reflects the contribution each
individual makes to the organisation.
Pensions and benefits
We offer market-aligned wellbeing benefit packages reflecting
market practice in each country in which we operate.
Where appropriate, we offer elements of personal benefit
choice to our employees.
The benefit packages of our Executive Directors and the SET
are broadly aligned with the wider workforce of the country in
which they are employed. Pension allowances for current UK
Executive Directors are in line with the wider UK workforce.
Annual bonus
With the exception of our sales representatives receiving
sales-related incentives, our global workforce participates
in the same annual cash bonus plan as the Executive Directors
and the SET, with the same Group scorecard performance
measures outlined on page 121. Achievement against
the scorecard creates a bonus pool from which all awards
are made.
For employees within our commercial organisation, the
country-level share of the global bonus pool also takes into
account country performance against Key Performance
Indicators (KPIs).
Individual outcomes are based on manager assessment of
contribution against individual objectives and peers. Awards
are based on a 0-200% target range.
The ranges for Executive Directors and the SET align with the
wider workforce at 0-200% of target. Half of any award to an
Executive Director under the plan is subject to deferral into
shares subject to a three-year holding period. One sixth of any
award to the SET under the plan is deferred into shares and is
subject to a three-year holding period.
Long-term
incentives
The PSP is operated with a three-year performance period for
employees at Vice-President and Senior Vice-President level,
with the same performance measures that apply to PSP
awards made to the Executive Directors and the SET (outlined
from page 124).
A proportion of our workforce below this level is eligible to be
considered for other LTI awards, such as restricted stock
awards. 35% of our global employee population are eligible to
receive an award under our LTI plans.
PSP awards to Executive Directors and the SET are
granted under the same plan as PSP awards granted to
Vice-Presidents and Senior Vice-Presidents. PSP awards
to Executive Directors and the SET are subject to a
two-year holding period following the three-year
performance period.
Change in Director remuneration compared to other employees
In the table below, as per the requirements of the Companies (Directors’ Remuneration Policy and Directors’ Remuneration Report)
Regulations 2019, changes to the base pay (or fees), taxable benefits and annual bonus of Directors are compared to employees for the
previous financial year. The regulations require comparison between the remuneration of each Director and that of all employees of the
parent company on a full-time equivalent basis. As AstraZeneca PLC has no direct employees, and in line with our disclosure approach in
prior years to changes in employee remuneration, the selected comparator group is comprised of employees in the UK, US and Sweden
who represent approximately 38% of our total employee population. We consider that this group is representative of the Group’s major
science, business and enabling units. These employee populations are also well balanced in terms of seniority and demographics.
Remuneration in the wider context
continued
Corporate Governance
132
AstraZeneca
Annual Report & Form 20-F Information 2024
Annual Report on Remuneration
continued
Summary of remuneration structure for employees below the Board
Change in 2024
against 2023 (%)
Change in 2023
against 2022 (%)
Change in 2022
against 2021 (%)
Change in 2021
against 2020 (%)
Change in 2020
against 2019 (%)
Base
pay/
fees
Benefits
Annual
bonus
Base
pay/
fees
Benefits
Annual
bonus
Base
pay/
fees
Benefits
Annual
bonus
Base
pay/
fees
Benefits
Annual
bonus
Base
pay/
fees
Benefits
Annual
bonus
Executive Directors
Pascal Soriot
4.0
-0.9
23.2
4.5
3.1
-9.2
3.0
10.5
-0.8
3.0
1.1
35.9
0.0
-2.7
20.0
Aradhana Sarin
4.0
-70.4
2.7
4.5
-71.6
-9.2
147.2
2,753.2
169.3
–
–
–
–
–
–
Non-Executive Directors
Michel Demaré
1
37.0
–
–
268.9
–
–
7.0
–
–
18.7
–
–
247.2
–
–
Euan Ashley
34.7
–
–
8.0
–
–
6.8
–
–
300.0
–
–
–
–
–
Philip Broadley
16.5
–
–
0.0
–
–
15.6
–
–
16.9
–
–
2.8
–
–
Deborah DiSanzo
16.7
–
–
0.0
–
–
11.1
–
–
0.0
–
–
0.0
–
–
Diana Layfield
22.7
–
–
0.0
–
–
19.9
–
–
525.6
–
–
–
–
–
Anna Manz
2
250.0
–
–
–
–
–
–
–
–
–
–
–
–
–
–
Sheri McCoy
17.1
–
–
11.7
–
–
23.6
–
–
3.0
–
–
0.0
–
–
Tony Mok
22.7
–
–
0.0
–
–
6.8
–
–
0.0
–
–
0.0
–
–
Nazneen Rahman
25.3
–
–
3.0
–
–
18.2
–
–
11.0
–
–
0.0
–
–
Andreas Rummelt
22.7
–
–
0.0
–
–
172.2
–
–
–
–
–
–
–
–
Marcus Wallenberg
24.0
–
–
0.0
–
–
17.1
–
–
3.6
–
–
0.0
–
–
Employees
5.8
5.8
7.7
7.0
7.0
3.2
6.0
6.0
19.3
4.9
4.9
44.4
4.1
4.1
-11.6
1
Michel Demaré was appointed Chair of the Board on 27 April 2023.
2
Anna Manz was appointed on 1 September 2023.
CEO and employee pay ratios
The table below sets out the ratios of the CEO’s realised pay to the equivalent pay for the lower quartile, median and upper quartile UK
employees (calculated on a full-time equivalent basis). The ratios have been calculated in accordance with the Companies
(Miscellaneous
Reporting) Regulations 2018 (the Regulations).
Year
Method
25th percentile pay ratio
50th percentile pay ratio
75th percentile pay ratio
2024
Option A
231:1
153:1
102:1
2023
Option A
271:1
182:1
121:1
2022
Option A
230:1
159:1
107:1
2021
Option A
240:1
162:1
106:1
2020
Option A
284:1
197:1
130:1
2019
Option A
280:1
190:1
123:1
2018
Option A
230:1
160:1
103:1
The comparison with UK employees is specified by the Regulations. This group represents approximately 11% of our total employee
population. The Regulations provide flexibility to adopt one of three methods of calculation; we continue to use Option A which is a calculation
based on all UK employees on a full-time equivalent basis as we consider this to be the most appropriate method of comparison and in line
with the calculation of CEO’s realised pay (shown on page 119 for 2024). The ratios are based on total pay, which includes base pay, benefits,
bonus and LTI awards with all elements adjusted on a full-time equivalent basis if required. Our calculations are in line with the single figure
methodology for UK employees where possible, with quartile data determined as at 31 December 2024. Calculations for UK employees are
based on actual base pay and benefits data for the year, with estimates only used for annual bonus outcomes and LTI dividend equivalents.
These estimates are based on the 2024 bonus budget and projected payouts, and anticipated dividends on LTI awards, respectively.
No elements of pay have been excluded from the calculation, which has been determined following the approach of previous years.
CEO
UK employees
25th percentile
50th percentile
75th percentile
Pay data (£’000)
1
Base pay
Total pay
Base pay
Total pay
Base pay
Total pay
Base pay
Total pay
2024
1,486
14,728
50
64
70
96
91
144
2023
1,429
16,853
46
62
65
92
88
139
2022
1,367
15,323
48
67
67
96
88
143
2021
1,327
13,858
43
58
61
86
86
130
2020
1,289
15,447
41
54
60
78
82
119
2019
1,289
14,330
38
51
53
75
71
117
2018
1,251
11,356
36
49
50
71
70
110
1
The prior years’ figures have not been restated for subsequent share price changes (as shown in the CEO realised pay for 2024 table on page 119).
The pay ratios at each quartile were lower in 2024 when compared to last year, due to a lower long-term incentive value realised for the
CEO in 2024.
Corporate Governance
Additional Information
Financial Statements
Strategic Report
133
AstraZeneca
Annual Report & Form 20-F Information 2024
Directors’ Remuneration Report
Given the Committee’s focus on ensuring CEO pay is performance-driven (and as demonstrated again this year), the majority of the single
figure is comprised of variable pay and therefore may vary significantly year-on-year due to annual bonus and PSP outcomes, as well as
share price movements. The Committee therefore also considers the CEO pay ratio without the LTI impact. When excluding LTI, the pay
ratio of the CEO compared to the median UK employee is 57:1.
2018
2019
2020
2021
2022
2023
2024
50th percentile ratio excluding LTI
51:1
51:1
53:1
57:1
51:1
52:1
57:1
The Committee remains mindful of the debate on executive pay and seeks to ensure that when determining the remuneration of the CEO
it finds the right balance when rewarding performance in a highly competitive global executive talent market. It believes the median ratio is
consistent with the pay and progression policies for UK employees, which ensures our total reward offering is competitive and compelling,
and aligned to individual and business performance as set out on page 131.
Relative importance of spend on pay
The table below shows the remuneration paid to all employees in the Group, including the Executive Directors, and expenditure on
shareholder distributions through dividends. The figures have been calculated in accordance with the Group Accounting Policies and
drawn from either the Group’s Consolidated Statement of Comprehensive Income on page 148, or its Consolidated Statement of Cash
Flows on page 151. Further information on the Group’s Accounting Policies can be found from page 152.
2024
2023
Difference
in spend
between
years
$m
Difference
in spend
between
years
%
Total employee remuneration
13,709
12,335
1,374
11
Distributions to shareholders: dividends paid
4,629
4,481
148
3
Total shareholder return
The graph below compares the TSR performance of the Company over the past 10 years with the TSR of the FTSE 100 Index and our global
pharmaceutical peers. This graph is re-based to 100 at the start of the relevant period. These indices represent appropriate reference
points for AstraZeneca reflecting our primary listing as a constituent of the FTSE 100 and a comparison against our global pharmaceutical
peers. The pharmaceutical comparator group is also used to assess relative TSR performance for PSP awards to be granted in 2025 and
consists of AbbVie, Amgen, Astellas, BMS, Daiichi Sankyo, Eli Lilly, Gilead, GSK, Johnson & Johnson, Merck KGaA, Moderna, MSD,
Novartis, Novo Nordisk, Pfizer, Roche, Sanofi and Takeda. CEO remuneration over the same 10-year period is shown after the TSR graph.
AstraZeneca
Global pharmaceutical peers average
FTSE 100
400
300
200
100
Dec
14
Dec
15
Dec
16
Dec
17
Dec
18
Dec
19
Dec
20
Dec
21
Dec
22
Dec
23
Dec
24
TSR over a 10-year period
CEO total remuneration table
Year
CEO
CEO
realised pay
£’000
Annual bonus
payout against
maximum
opportunity
%
LTI vesting
rates against
maximum
opportunity
%
2024
Pascal Soriot
14,728
1
78.5
84
2023
Pascal Soriot
17,371
2
79.5
88
2022
Pascal Soriot
15,085
92
97
2021
Pascal Soriot
15,740
95
95
2020
Pascal Soriot
15,934
90
99
2019
Pascal Soriot
15,307
83
90
2018
Pascal Soriot
12,868
83
79
2017
Pascal Soriot
10,429
87
81
2016
Pascal Soriot
14,342
3
54
95
2015
Pascal Soriot
7,963
97
78
1
The 2024 realised pay is shown on page 119.
2
This figure has been revised using the average closing share price over the three-month period to 31 December 2024, as explained on page 124.
3
This figure includes shares awarded to Mr Soriot in 2013 under the AZIP to compensate him for LTI awards from previous employment forfeited on his recruitment as the
Company’s CEO.
Remuneration in the wider context
continued
Corporate Governance
134
AstraZeneca
Annual Report & Form 20-F Information 2024
Annual Report on Remuneration
continued
Governance
Committee membership
The Committee members as at 31 December 2024 were Sheri McCoy (Chair of the Committee), Philip Broadley, Michel Demaré and
Nazneen Rahman. The Deputy Company Secretary acts as secretary to the Committee. The Committee met seven times in 2024 and
members’ attendance records are set out on page 87. During the year, the Committee was materially assisted, except in relation to their
own remuneration, by the CEO; the CFO; the SVP, Finance, Group Controller & Head of Global Finance Services; the SVP, Group Planning &
Finance Business Partnering; the SVP, Global Portfolio/Project Management and Strategic Planning; the VP, Global Sustainability and SHE;
the Chief Human Resources Officer, Chief Compliance Officer and General Counsel; the SVP, Reward; the Senior Director Executive
Reward; the Company Secretary; the Deputy Company Secretary; and the Non-Executive Directors forming the Science and Sustainability
Committees. The Committee’s independent adviser attended all Committee meetings.
Independent adviser to the Committee
The Committee reappointed Willis Towers Watson (WTW) as its independent adviser. WTW were first appointed in September 2018,
following a tender process undertaken in 2018. The tender process involved submission of written proposals, followed by shortlisted
candidates being interviewed by both Committee members and members of the Company’s management. WTW’s service to the Committee
during 2024 was provided on a time spent basis at a cost to the Company of £218,700, excluding VAT. During 2024, WTW also provided
pensions advice and administration, and advice and support to management including market data to assist in the annual employee pay
review, global pay survey data and employee benefits review. WTW have no other connection with the Company or individual Directors.
The Committee reviewed the potential for conflicts of interest related to WTW and judged that there were no conflicts. WTW is a member
of the Remuneration Consultants Group, which is responsible for the stewardship and development of the voluntary code of conduct in
relation to executive remuneration consulting in the UK. The principles on which the code is based are transparency, integrity, objectivity,
competence, due care and confidentiality. WTW adheres to the code.
Corporate Governance
Additional Information
Financial Statements
Strategic Report
135
AstraZeneca
Annual Report & Form 20-F Information 2024
Directors’ Remuneration Report
Governance
continued
Malus and clawback
The Committee regularly reviews the Company’s approach to malus and clawback and market practice in this area, and our Global
Standard on Malus and Clawback sets out the trigger events and the time periods these provisions may apply to. As a condition of annual
bonus and PSP awards, the Committee seeks active acceptance of the malus and clawback terms applicable each year before any payment
or grant is made to an individual. Additionally, the Committee’s practice is to fully document and evidence any application of malus or
clawback to show that it has not acted arbitrarily, capriciously or irrationally in making any determination. This allows the Committee to:
•
Reduce the amount of bonus or PSP payable, or clawback some or all of any award in the circumstances and periods as set out within
our Global Standard on Malus and Clawback.
•
Cancel bonus eligibility.
•
Prevent vesting of the PSP and/or DBP awards by holding the shares in AstraZeneca’s LTI nominee platform to prevent transactions.
Shareholder voting at the AGM
At the Company’s AGM on 11 April 2024, shareholders voted in favour of a resolution to approve the Directors’ Remuneration Policy and
Annual Statement of the Chair of the Remuneration Committee and the Annual Report on Remuneration for the year ended
31 December 2023. The Policy can be found on the Company’s website, www.astrazeneca.com/annualreport2024.
Resolution
Votes for
% for
Votes against
% against
Total votes cast
% of issued
share
capital voted
Withheld
votes
Ordinary Resolution to approve the Annual Statement of the
Chair of the Remuneration Committee and the Annual Report
on Remuneration for the year ended 31 December 2023
1,158,470,360
95.32
56,835,406
4.68
1,215,305,766
78.40
1,558,941
Ordinary Resolution to approve the Directors’ Remuneration
Policy
761,702,826
64.43
420,514,520
35.57
1,182,217,346
76.26 34,645,873
The response to the shareholder vote to approve the Directors’ Remuneration Policy at the 2024 AGM is outlined in the Remuneration
Committee Chair’s letter on page 112.
Directors’ service contracts and letters of appointment
The notice periods and unexpired terms of Executive Directors’ service contracts at 31 December 2024 are shown in the table below.
Executive Director
Effective date of service
contract
Unexpired term at 31 December 2024
Notice period
Pascal Soriot
15 December 2016
12 months
12 months
Aradhana Sarin
1 August 2021
12 months
12 months
None of the Non-Executive Directors has a service contract but each has a letter of appointment. In accordance with the Company’s
Articles of Association, following their appointment, all Directors must retire at each AGM and may present themselves for re-election.
All of the Non-Executive Directors, including the Chair of the Board, may terminate their appointment at any time, on three months’ notice.
None of the Non-Executive Directors has any provision in their letters of appointment giving them a right to compensation upon early
termination of appointment.
Basis of preparation of this Directors’ Remuneration Report
This Directors’ Remuneration Report has been prepared in accordance with the Large and Medium-sized Companies and Groups
(Accounts and Reports)
(Amendment) Regulations 2013 (as amended) (the 2013 Regulations). A resolution to receive and approve the
Directors’ Remuneration Report will be proposed at the AGM on 11 April 2025.
On behalf of the Board
A C N Kemp
Company Secretary
6 February 2025
Corporate Governance
136
AstraZeneca
Annual Report & Form 20-F Information 2024
Annual Report on Remuneration
continued
Contents
Preparation of the Financial Statements
and Directors’ Responsibilities
138
Directors’ Annual Report on Internal Controls
over Financial Reporting
138
Independent Auditors’ Report
139
Consolidated Statements
148
Group Accounting Policies
152
Notes to the Group Financial Statements
160
Group Subsidiaries and Holdings
214
Company Statements
219
Company Accounting Policies
221
Notes to the Company Financial Statements
223
Group Financial Record
226
Financial
Statements
Corporate Governance
Additional Information
Financial Statements
Strategic Report
137
AstraZeneca
Annual Report & Form 20-F Information 2024
Financial Statements
Under company law, the Directors must not
approve the Financial Statements unless
they are satisfied that they give a true and
fair view of the state of affairs of the Group
and Parent Company and of their profit or
loss for that period. In preparing each of
the Group and Parent Company Financial
Statements, the Directors are required to:
•
Select suitable accounting policies
and then apply them consistently.
•
Make judgements and estimates that
are reasonable and prudent.
•
For the Group Financial Statements,
state whether they have been prepared
in accordance with UK-adopted
International Accounting Standards.
•
For the Parent Company Financial
Statements, state whether FRS 101 has
been followed, subject to any material
departures disclosed and explained in the
Parent Company Financial Statements.
•
Prepare the Financial Statements on a
going concern basis unless it is
inappropriate to presume that the
Group and the Parent Company will
continue in business.
The Directors are responsible for keeping
adequate accounting records that are
sufficient to show and explain the Parent
Company’s transactions and disclose with
reasonable accuracy at any time the
financial position of the Parent Company.
This enables them to ensure that the
Financial Statements comply with the
Companies Act 2006. They have general
responsibility for taking such steps as are
reasonably open to them to safeguard the
assets of the Group and to prevent and
detect fraud and other irregularities.
The Directors assessed the effectiveness
of AstraZeneca’s internal control over
financial reporting as at 31 December 2024
based on the criteria set forth by the
Committee of Sponsoring Organizations
of the Treadway Commission in Internal
Control-Integrated Framework (2013).
Based on this assessment, internal control
over financial reporting is effective.
PricewaterhouseCoopers LLP, an
independent registered public accounting
firm, has audited the effectiveness of
internal control over financial reporting as
at 31 December 2024 and has issued an
unqualified report thereon.
Under applicable law and regulations, the
Directors are also responsible for preparing a
Directors’ Report, Strategic Report, Directors’
Remuneration Report, Corporate Governance
Report and Audit Committee Report that
comply with that law and those regulations.
The Directors are responsible for the
maintenance and integrity of the corporate
and financial information included on our
website. Legislation in the UK governing the
preparation and dissemination of Financial
Statements may differ from legislation in
other jurisdictions.
Directors’ responsibility statement
pursuant to DTR 4
The Directors confirm that to the best
of our knowledge:
•
The Financial Statements, prepared in
accordance with the applicable set of
accounting standards, give a true and
fair view of the assets, liabilities, financial
position and profit or loss of the Company
and the undertakings included in the
consolidation taken as a whole.
•
The Directors’ Report includes a fair
review of the development and
performance of the business and the
position of the Company and the
undertakings included in the
consolidation taken as a whole, together
with a description of the principal risks
and uncertainties that they face.
On behalf of the Board of Directors on
6 February 2025.
Pascal Soriot
Director
The Directors are responsible for preparing
this Annual Report and Form 20-F Information
and the Group and Parent Company Financial
Statements in accordance with applicable
law and regulations.
Company law requires the Directors to
prepare Financial Statements for each
financial year. Under that law, the Directors
have prepared the Group Financial
Statements in accordance with UK-adopted
international accounting standards and with
the requirements of the Companies Act
2006, as applicable to companies reporting
under those standards and Parent Company
Financial Statements in accordance with
United Kingdom Generally Accepted
Accounting Practice (United Kingdom
Accounting Standards, comprising FRS 101
‘Reduced Disclosure Framework’, and
applicable law). In preparing the Group
Financial Statements, the Directors have
also elected to comply with IFRS Accounting
Standards as issued by the International
Accounting Standards Board (IASB) and
International Accounting Standards as
adopted by the European Union.
The Directors are responsible for
establishing and maintaining adequate
internal control over financial reporting.
AstraZeneca’s internal control over financial
reporting is designed to provide reasonable
assurance over the reliability of financial
reporting and the preparation of
consolidated financial statements in
accordance with generally accepted
accounting principles.
Due to its inherent limitations, internal
control over financial reporting may not
prevent or detect misstatements.
Projections of any evaluation of
effectiveness to future periods are
subject to the risk that controls may
become inadequate because of changes
in conditions, or that the degree of
compliance with the policies or
procedures may deteriorate.
138
AstraZeneca
Annual Report & Form 20-F Information 2024
Financial Statements
Preparation of the Financial Statements and Directors’ Responsibilities
Directors’ Annual Report on Internal Controls over Financial Reporting
Separate opinion in relation to IFRS
Accounting Standards as issued by
the IASB
As explained in the Group Accounting
Policies to the financial statements, the
Group, in addition to applying UK-adopted
international accounting standards, has also
applied IFRS Accounting Standards as
issued by the International Accounting
Standards Board (IASB).
In our opinion, the Group financial
statements have been properly prepared
in accordance with IFRS Accounting
Standards as issued by the IASB.
Basis for opinion
We conducted our audit in accordance with
International Standards on Auditing (UK)
(“ISAs
(UK)”) and applicable law. Our
responsibilities under ISAs (UK) are further
described in the Auditors’ responsibilities
for the audit of the financial statements
section of our report. We believe that the
audit evidence we have obtained is
sufficient and appropriate to provide a
basis for our opinion.
Independence
We remained independent of the Group in
accordance with the ethical requirements
that are relevant to our audit of the financial
statements in the UK, which includes the
FRC’s Ethical Standard, as applicable to
listed public interest entities, and we have
fulfilled our other ethical responsibilities in
accordance with these requirements.
To the best of our knowledge and belief, we
declare that non-audit services prohibited by
the FRC’s Ethical Standard were not provided.
Other than those disclosed in Note 31, we
have provided no non-audit services to the
Company or its controlled undertakings in
the period under audit.
Our audit approach
Overview
Audit scope
•
Our audit included full scope audits,
audit of specific significant line item or
specified procedures at each of the
Group’s 19 in-scope components.
•
Taken together, the components at which
audit work was performed accounted for
more than 70% of the Group’s revenue.
Our scoping provided sufficient coverage
over each significant financial statement
line item of the Group financial statements
and, provided us with the evidence we
needed for our opinion on the Group
financial statements taken as a whole.
Key audit matters
•
Recognition and measurement of
accruals for Managed Care, Medicaid and
Medicare Part D rebates on US Product
Sales (excluding Rare Diseases) (Group)
•
Impairment assessment of the product,
marketing and distribution rights and
other intangibles (Group)
•
Recognition and measurement of legal
provisions and disclosure of contingent
liabilities (Group)
•
Recognition, measurement and disclosure
of tax liabilities for uncertain tax
treatments (Group)
•
Valuation of defined benefit obligations in
the UK and Sweden (Group)
•
Distributable reserves in the Company
(Parent)
Materiality
•
Overall Group materiality: $500m (2023
:
$440m) based on approximately 5%
of profit before tax after adding back
intangible asset impairment charges
(Note 10), fair value movements and
discount unwind on contingent
consideration (Note 20), and the
discount unwind on certain other
payables arising from intangible asset
acquisitions (Note 3).
•
Overall Company materiality: $155m
(2023: $110m) based on 0.2% of net
assets as constrained by the allocation
of overall Group materiality.
•
Performance materiality: $375m
(2023: $330m)
(Group) and $116.25m
(2023: $82.5m)
(Company).
The scope of our audit
As part of designing our audit, we determined
materiality and assessed the risks of material
misstatement in the financial statements.
Key audit matters
Key audit matters are those matters that, in
the auditors’ professional judgement, were
of most significance in the audit of the
financial statements of the current period
and include the most significant assessed
risks of material misstatement (whether or
not due to fraud) identified by the auditors,
including those which had the greatest effect
on: the overall audit strategy; the allocation
of resources in the audit; and directing the
efforts of the engagement team. These
matters, and any comments we make on the
results of our procedures thereon, were
addressed in the context of our audit of the
financial statements as a whole, and in
forming our opinion thereon, and we do not
provide a separate opinion on these matters.
This is not a complete list of all risks
identified by our audit.
The key audit matters below are
consistent with last year.
Report on the audit of the
financial statements
Opinion
In our opinion:
•
AstraZeneca PLC’s Group financial
statements and Company financial
statements (the “financial statements”)
give a true and fair view of the state of
the Group’s and of the Company’s affairs
as at 31 December 2024 and of the
Group’s profit and the Group’s cash
flows for the year then ended;
•
the Group financial statements have been
properly prepared in accordance with
UK-adopted international accounting
standards as applied in accordance with
the provisions of the Companies Act 2006;
•
the Company financial statements have
been properly prepared in accordance
with United Kingdom Generally Accepted
Accounting Practice (United Kingdom
Accounting Standards, including FRS 101
“Reduced Disclosure Framework”, and
applicable law); and
•
the financial statements have been
prepared in accordance with the
requirements of the Companies Act 2006.
We have audited the financial statements,
included within the Annual Report and Form
20-F Information 2024 (the “Annual
Report”), which comprise: the Consolidated
Statement of Financial Position and the
Company Balance Sheet as at 31 December
2024; the Consolidated Statement of
Comprehensive Income, the Consolidated
Statement of Cash Flows, and the
Consolidated and Company Statements of
Changes in Equity for the year then ended;
the Group and Company Accounting
Policies; and the Notes to the Group and
Company Financial Statements.
Our opinion is consistent with our reporting
to the Audit Committee.
Separate opinion in relation to
International Accounting Standards as
adopted by the European Union
As explained in the Group Accounting
Policies to the financial statements, the
Group, in addition to applying UK-adopted
international accounting standards, has also
applied International Accounting Standards
as adopted by the European Union.
In our opinion, the Group financial statements
have been properly prepared in accordance
with International Accounting Standards as
adopted by the European Union.
139
Financial Statements | Independent auditors’ report to the members of AstraZeneca PLC
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Independent auditors’ report to the members of AstraZeneca PLC
Recognition and measurement of accruals for Managed Care, Medicaid and Medicare
Part D rebates on US Product Sales (excluding Rare Diseases) (Group)
Impacted FSLIs
2024
2023
US Rebates, chargebacks, returns and other revenue accruals liability (excluding Rare Diseases)
(which principally consists of rebates related to Managed Care, Medicaid and Medicare Part D)
$4,738m
$4,926m
In the US the Group recognises revenue on Product Sales under various
commercial and government mandated contracts and reimbursement
arrangements that include rebates, of which the most significant are
Managed Care, Medicaid and Medicare Part D relating to US Product Sales.
Rebates provided to customers under these arrangements are accounted for
as variable consideration, and recognised as a reduction to revenue, for which
unsettled amounts are accrued. At the time Product Sales are invoiced, rebates
and deductions that the Group expects to pay, are estimated. There is
significant management estimation in determining the accruals in the US.
Assumptions used to estimate the rebates are monitored and adjusted regularly
in light of contractual and legal obligations, historical trends, past experience
and projected market conditions.
Discussions with the Audit Committee
How our audit addressed the Key Audit Matter
Our discussions with and reporting to the Audit Committee included:
•
Our approach to the audit of rebates including details of planned
substantive procedures and the extent of our controls reliance;
•
For the recorded accruals, whether the Group’s estimate is
comparable to our developed estimates; and
•
Our views of management’s assessment over the accuracy of
the accruals.
Relevant references in the Annual Report
Refer to the Audit Committee Report, Group Accounting Policies and Notes 1
and 20 in the Group financial statements.
We evaluated the design and tested the operating effectiveness of controls
relating to the recognition and measurement of the accruals for the Managed
Care, Medicaid and Medicare Part D. We determined that we could rely on
these controls for the purposes of our audit. We:
i) developed an independent estimate of the Managed Care, Medicaid and
Medicare Part D accruals using the terms of the specific rebate programmes
and/or contracts with customers, historical revenue data; market demand and
market conditions in the US; third party information on inventory held by direct
and indirect customers; and the historical trend of actual rebate claims paid;
ii) compared our independent estimates to the accruals recorded by
management; iii) assessed the effect of any adjustments to prior years’
accruals in the current year’s results; and iv) tested actual payments made
and rebate claims processed by the Group, and evaluated those claims for
consistency with the contractual and mandated terms of the Group’s
arrangements.
We considered the disclosures in Notes 1 and 20 of the Group financial
statements for reasonableness.
140
AstraZeneca
Annual Report & Form 20-F Information 2024
Financial Statements
Independent auditors’ report to the members of AstraZeneca PLC
continued
Impairment assessment of the product, marketing and distribution rights and other intangibles (Group)
Impacted FSLIs
2024
2023
Product, marketing and distribution rights and other intangibles (hereafter referred to as the intangible assets)
$36,505m
$37,587m
Net impairment charges
$1,572m
$434m
The recoverability of the carrying value of cash generating units (to which
the intangible assets belong) depends on future cash flows and/or the
outcome of research and development (‘R&D’) activities including
decisions by the Group to terminate development. The determination of the
recoverable amounts include significant estimates, which are highly
sensitive and depend upon key assumptions including the outcome of R&D
activities, probability of technical and regulatory success, market volume,
share and pricing (to derive peak year sales), the amount and timing of
projected future cash flows and sales erosion curves following patent
expiry. Changes in these assumptions could have an impact on the
recoverable amount of the Group’s intangible assets.
During 2024, $1,572m (2023: $434m) of net impairment charges were
recorded (of which $1,065m
(2023: $417m) was recorded in Research and
development expense and $507m (2023: $17m) within Selling, general and
administrative costs).
Discussions with the Audit Committee
How our audit addressed the Key Audit Matter
Our discussions with and reporting to the Audit Committee included:
•
Our approach to audit the impairment assessment of the carrying
value of cash generating units (to which the intangible assets belong)
including details of planned substantive procedures and the extent of
our controls reliance;
•
the methodologies and significant assumptions used to determine the
recoverable values of the intangible assets; and
•
our experts’ assessments of evaluation of the probability of technical and
regulatory success.
Relevant references in the Annual Report
Refer to the Audit Committee Report, Group Accounting Policies and Note 10
in the Group financial statements.
We evaluated the design and tested the operating effectiveness of controls
over management’s assessment of the impairment of intangible assets. We
determined that we could rely on these controls for the purposes of our audit.
For those assets or cash generating units in the scope of our audit we: i)
tested management’s process for assessing whether there is an indication of
impairment and the process for determining the recoverable amount; ii) tested
the completeness and accuracy of the models as well as the underlying data
used in the models, which included reconciling the cash flows to the Board
approved Group level budgets and forecasts; and iii) evaluated the significant
assumptions used by management in determining future cash flows, including
the probability of technical and regulatory success, peak year sales and sales
erosion curves.
In evaluating the reasonableness of management’s assumptions we:
i) compared significant assumptions to external data and benchmarks; and
ii) performed a retrospective comparison of forecasted revenues and costs
to actual performance. We utilised our in-house valuation experts to assist
with the evaluation of the probability of technical and regulatory success.
We considered the disclosures in Note 10 of the Group financial statements
for reasonableness.
141
Financial Statements | Independent auditors’ report to the members of AstraZeneca PLC
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Recognition and measurement of legal provisions and disclosure of contingent liabilities (Group)
Impacted FSLIs
2024
2023
Provisions in respect of legal claims and settlements (together, legal provisions)
$859m
$1,016m
Financial statements disclosure: Contingent liabilities disclosure in respect of legal proceedings
Note 30
Note 30
The Group is involved in various legal proceedings, including actual or
threatened litigation and actual or potential government investigations
relating to employment matters, product liability, commercial disputes,
pricing, sales and marketing practices, infringement of IP rights and the
validity of certain patents and competition laws.
There is significant judgement by management when assessing the timing
and likelihood of loss being incurred and whether a legal provision can be
reasonably estimated and recorded or if a contingent liability needs to be
disclosed. Management’s assessment of the amounts concerned relies heavily
on estimates and assumptions.
Discussions with the Audit Committee
How our audit addressed the Key Audit Matter
Our discussions with and reporting to the Audit Committee included:
•
Our approach to audit the assessment of the ongoing litigations and
claims including details of planned substantive procedures and the
extent of our controls reliance;
•
The assessment of management’s judgement in the outcome of the
Group’s legal matters;
•
Consideration of any potential impacts on the financial statements in
respect of the investigations by Chinese authorities into current and
former AstraZeneca employees regarding allegations of medical
insurance fraud, illegal drug importation and personal information
breaches; and
•
Our conclusions on the appropriateness of the in-year movements in the
legal provisions.
Relevant references in the Annual Report
Refer to the Audit Committee Report, Group Accounting Policies,
Notes 21 and 30 in the Group financial statements.
We evaluated the design and tested the operating effectiveness of controls in
respect of the recognition and measurement of legal proceedings and related
disclosures. We determined that we could rely on these controls for the
purposes of our audit.
We enquired of internal legal counsel and where appropriate external legal
counsel. We obtained and evaluated letters of audit enquiry with the Group’s
internal and external legal counsel for significant litigation. We have inspected
certain external legal documents. Where appropriate, with the support of PwC
Forensic specialists, we considered the scope, preliminary findings and
conclusions of investigations. We tested the completeness of management’s
assessment of both the identification of legal proceedings and possible
outcomes of each significant legal matter. We evaluated the reasonableness of
management’s assessment regarding whether an adverse outcome is probable
and estimated reliably. We evaluated management’s judgement regarding the
proceedings set out as contingent liabilities within Note 30.
We considered the disclosures in Notes 21 and 30 of the Group financial
statements for reasonableness.
Recognition, measurement and disclosure of tax liabilities for uncertain tax treatments (Group)
Impacted FSLIs
2024
2023
Net tax liability in respect of Uncertain tax treatments
$1,321m
$1,336m
Financial statements disclosure: Contingent liabilities disclosure in respect of tax matters
$636m
$679m
The Group faces a number of audits and reviews in jurisdictions
around the world and, in some cases, is in dispute with tax authorities.
Tax liabilities recognised for uncertain tax treatments require management to
make key judgements with respect to the outcome of current and potential future
tax audits, reviews and disputes with tax authorities, and actual results could
vary from these estimates.
Discussions with the Audit Committee
How our audit addressed the Key Audit Matter
Our discussions with and reporting to the Audit Committee included:
•
Our approach to the audit of the assessment of the tax liabilities
for uncertain tax treatments and related contingent liabilities
disclosures including details of planned substantive procedures
and the extent of our controls reliance; and
•
Our experts’ assessments of evaluation of the reasonableness of
the assumptions relating to the most likely amount or expected
value provision.
Relevant references in the Annual Report
Refer to the Audit Committee Report, Group Accounting Policies and
Note 30 in the Group financial statements.
We evaluated the design and tested the operating effectiveness of controls in
respect of the recognition and measurement of uncertain tax treatments. We
determined that we could rely on these controls for the purposes of our audit.
We tested the completeness of management’s assessment of the identification
of tax liabilities and evaluated management’s process for estimating the possible
outcomes of each tax liability. We obtained the status and results of tax audits and
discussions with the relevant tax authorities. With the assistance of our local and
international tax specialists, we:
i) evaluated management’s assessment of the technical merits of tax treatments
(including where relevant evaluating any advice received from the Group’s external
advisors) and estimates of the amount of tax benefit expected to be sustained;
ii) tested the completeness and accuracy of the information used in the determination
of the probability of different outcomes for uncertain tax treatments and the
estimation of the liability for those tax treatments; and iii) evaluated the reasonableness
of significant assumptions related to the outcome of tax audits and assumptions
relating to the most likely amount or expected value depending on the resolution
of the uncertainty.
We considered the disclosures in Note 30 of the Group financial statements for
reasonableness.
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AstraZeneca
Annual Report & Form 20-F Information 2024
Financial Statements
Independent auditors’ report to the members of AstraZeneca PLC
continued
Valuation of defined benefit obligations in the UK and Sweden (Group)
Impacted FSLIs
2024
2023
Defined benefit obligations in the UK and Sweden
$6,100m
$6,736m
The Group’s most significant schemes are in the UK and Sweden.
The valuation of pension plan obligations requires significant estimation
in determining appropriate assumptions such as mortality (for the UK
scheme only), discount rates and inflation levels (for both the UK and
Sweden schemes).
Movements in these assumptions can have a material impact on the
determination of the defined benefit obligations. Management uses
external actuaries to assist in determining the assumptions.
Discussions with the Audit Committee
How our audit addressed the Key Audit Matter
Our discussions with and reporting to the Audit Committee included:
•
Our approach to the audit of the valuation of the defined benefit
obligations in the UK and Sweden including details of planned
substantive procedures and the extent of our controls reliance; and
•
For the significant assumptions used by management, whether and
where the Group’s assumptions lay within our reasonable range.
Relevant references in the Annual Report
Refer to the Audit Committee Report, Group Accounting Policies and Note 22
in the Group financial statements.
We evaluated the design and tested the operating effectiveness of controls
in respect of the assumptions used and accuracy of the Group’s most
significant defined benefit obligations. We determined that we could rely
on these controls for the purposes of our audit.
We used actuarial experts to assess whether the assumptions used in
calculating the defined benefit obligations for the UK and Sweden were
reasonable. Our actuarial experts assisted in developing an independent
expectation of the defined benefit obligations for the UK and Sweden. Our
experts evaluated whether the mortality assumptions (UK scheme only) and
the discount rates and inflation rates (for both the UK and Sweden schemes)
were: i) consistent with the specifics of each plan and where relevant
considering national information; ii) consistent with independently developed
estimates; and iii) in line with other companies’ recent external reporting.
We evaluated the calculations prepared by management’s external actuaries
which included testing the completeness and accuracy of the underlying data.
In order to evaluate the reasonableness of management’s estimate, our experts
also compared the independent estimate to management’s estimate.
We considered the disclosures in Note 22 of the Group financial statements
for reasonableness.
Distributable reserves in the Company (Parent)
Impacted FSLIs
2024
2023
The Company’s Profit and loss account
$13,495m
$ 17,640m
The directors review and disclose the level of distributable reserves of the
Company annually and aim to maintain distributable reserves that provide
adequate cover for dividend payments. At 31 December 2024, the
overwhelming majority of the Profit and loss account reserve of $13,495m
(31 December 2023: the overwhelming majority of $17,640m) was available
for distribution, subject to filing the Company financial statements with
Companies House.
There is judgement when determining the profits available for distribution
by reference to guidance on realised and distributable profits in accordance
with Companies Act 2006 issued by the Institute of Chartered Accountants
in England and Wales and the Institute of Chartered Accountants of Scotland
in April 2017.
Discussions with the Audit Committee
How our audit addressed the Key Audit Matter
Our discussions with and reporting to the Audit Committee included:
•
Our approach to audit the assessment of the distributable reserves
in the Company including involvement of our internal experts; and
•
Our experts’ assessments in relation to the appropriateness of
management’s judgements.
Relevant references in the Annual Report
Refer to the Company Statement of Changes in Equity in the Company
financial statements.
We obtained and audited the analysis of distributable reserves.
We used our distributable reserves experts to assess whether judgements
made were appropriate and the analysis was aligned with the relevant technical
guidance on the determination of realised profits under the Companies Act
2006. We assessed whether there is qualifying consideration in determining
whether the Profit and loss account reserve is distributable.
We considered the disclosure related to the profits available for distribution
for reasonableness.
143
Financial Statements | Independent auditors’ report to the members of AstraZeneca PLC
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Note that, based on the structure of the
Group, work on some parts or the entirety
of some of these line items was performed
centrally, including by our SSC component
teams.
•
Our SSC component teams represented
five out of the remaining nine
components and were located in Poland,
Malaysia, India, Costa Rica and Romania.
These teams performed audit procedures
over certain controls and transactions.
•
Three out of the remaining four
components, which represent US tax
reporting entities, were scoped in for
taxation line items in the financial
statements because of the size or risk.
•
As an element of unpredictability, one
final component in Brazil was scoped in
for an audit of specific individual financial
statement line items with our work
focussed on revenue, and trade and other
receivables.
•
Additionally, for non-full scope components
which were not considered inconsequential
components, we performed targeted risk
assessments procedures.
•
Audit procedures were performed
centrally at the Group level in relation to
various balances and activities accounted
for and managed centrally including:
goodwill, intangible assets (excluding
software), centralised cash, borrowings
and financial instruments, taxation, other
investments and litigation matters as well
as the consolidation.
In April 2024, we held a meeting with the
partners and senior staff from the key PwC
member firms involved in the audit. At this
meeting we considered developments
specific to the Group, key audit matters and
discussed our approach to the Group audit
including the work performed at shared
service centre locations. We heard from key
members of management and the Chair of
the Audit Committee.
How we tailored the audit scope
We tailored the scope of our audit to ensure
that we performed enough work to be able to
give an opinion on the financial statements as
a whole, taking into account the structure of
the Group and the Company, the accounting
and consolidation processes and controls,
and the industry in which they operate.
The Group operates in over 100 countries
and the size of operations within each
territory varies. As a consequence of
implementing ISA (UK) 600 (Revised
) in this
year’s audit, we have refined how we
identify a component by defining each
distinct legal or reporting entity and each
Shared Service Centre (SSC) as a
component. Each component subsequently
reports to the Group through an integrated
consolidation system.
In selecting the components that are in
scope each year and establishing the overall
approach to the Group audit, we determined
the type of work that needed to be performed
by us, as the Group engagement team, or
component auditors within PwC UK and
other PwC network firms operating under
our instruction, to ensure that we had
sufficient coverage from our audit work
over each significant line of the Group
financial statements. Where the work was
performed by component auditors, we
determined the level of involvement we
needed to have in the audit work in these
territories to be able to conclude whether
sufficient appropriate audit evidence had
been obtained as a basis for our opinion on
the Group financial statements as a whole.
As a result of our risk assessment
procedures and the detailed scoping
exercise performed at the planning stage
of our audit, we identified 19 components
across 13 countries at which we determined
that we need to perform audit work. Taken
together, these components accounted for
more than 70% of the Group’s revenue.
The in-scope components were audited
by the Group engagement team and
13 component teams.
•
Out of the 19 components, we identified
four reporting components which required
a full scope audit of their complete financial
information, either due to their size or risk
characteristics. These components are the
principal operating units in the US (one
component) and China (two components),
as well as the Company.
•
For six out of the remaining 15 components,
we performed audit procedures on a
specific line item or line items within that
component that we considered had the
potential for the greatest impact on the
significant accounts in the financial
statements because of the size of these
accounts. The table opposite illustrates
the work covered in these six
components.
As part of our cycle of in person oversight
we visited: China, the US, Sweden, Ireland
and Brazil. In addition, we were in regular
contact with our UK component team in
Cambridge. We also visited the SSCs in
Poland, Malaysia and India. In addition to
these on-site visits, regular virtual meetings
with the component auditors were held,
whereby we performed reviews of the
component auditors’ planned response
to significant risks and reviewed the
component auditors working papers.
Alongside our team oversight we attended
meetings with local management.
The impact of climate risk on our audit
In planning and executing our audit, we
considered the potential impact of climate
change on the Group’s business and the
financial statements. The Group has set out
its intention – as part of the Ambition Zero
Carbon programme – to achieve net zero
greenhouse gas emissions by maximising
energy efficiency, shifting to renewable
energy sources and investing in nature-
based removals to compensate for any
residual GHG footprint.
As a part of our audit, we made enquiries
of management to understand the extent
of the potential impact of the physical and
transitional climate change risk on the
financial statements. We also discussed the
climate change initiatives and commitments
from Ambition Zero Carbon and other
initiatives to reduce CO
2
emissions, and the
impact these have on the Group including
on future cash flow forecasts. This includes
the committed investment to the ‘AZ Forest’
through 2030 and the continued commitment
to develop next-generation respiratory
inhalers with near-zero global warming
potential propellants for the pMDI inhaled
medicines portfolio.
Management considers that the impact of
climate change does not give rise to a
material financial statement impact. With the
assistance of our climate change experts,
Financial statement line item
Locations in specific scope
Revenue
UK, Sweden, US, Japan and Germany
Cost of sales
UK, Sweden, US and Ireland
Research and development expense
UK, Sweden and US
Selling, general and administrative expense
UK, Sweden, US and Ireland
Taxation
Sweden and US
Property, plant and equipment
UK, Sweden and Ireland
Non-current other receivables
UK
Inventories
UK, Sweden and Ireland
Trade and other receivables
UK, Sweden and US
Cash and cash equivalents
US
Trade and other payables
UK and Sweden
Retirement benefit obligations
UK and Sweden
Non-current other payables
UK and Sweden
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AstraZeneca
Annual Report & Form 20-F Information 2024
Financial Statements
Independent auditors’ report to the members of AstraZeneca PLC
continued
we evaluated management’s risk assessment
and understood the Group’s governance
processes including the Sustainability
Committee. We performed an audit risk
assessment of how the impact of the Group’s
commitments in respect of climate change
including Ambition Zero Carbon may affect
the financial statements and our audit.
We challenged the extent to which climate
change considerations including the
expected cash flows from the initiatives and
commitments had been reflected, where
appropriate, in management’s impairment
assessment process, going concern
assessment and viability assessment.
We found that climate change impacts are
included within management’s forecasts
although the initiatives and commitments
did not have a material impact including on
our key audit matters. We assessed the
consistency of other information disclosed
in the Annual Report with the financial
statements, and with our knowledge
obtained from the audit.
Materiality
The scope of our audit was influenced by
our application of materiality. We set certain
quantitative thresholds for materiality.
These, together with qualitative
considerations, helped us to determine the
scope of our audit and the nature, timing
and extent of our audit procedures on the
individual financial statement line items and
disclosures and in evaluating the effect of
misstatements, both individually and in
aggregate on the financial statements as
a whole.
Based on our professional judgement,
we determined materiality for the financial
statements as a whole as follows:
Financial statements – Group
Financial statements – Company
Overall materiality
$500m (2023: $440m).
$155m (2023: $110m).
How we determined it
Approximately 5% of profit before tax after adding back intangible asset
impairment charges (Note 10), fair value movements and discount unwind on
contingent consideration (Note 20), and the discount unwind on certain other
payables arising from intangible asset acquisitions (Note 3).
0.2% of net assets as constrained by the
allocation of overall Group materiality.
Rationale for
benchmark applied
The reported profit of the Group can fluctuate due to intangible asset
impairment charges, fair value and discount unwind movements on contingent
consideration, and the discount unwind on certain other payables arising from
intangible asset acquisitions. These amounts are prone to year on year
volatility and are not necessarily reflective of the operating performance of the
Group and as such they have been excluded from the benchmark amount. Our
approach is consistent with the prior year.
We have considered the nature of the business
of AstraZeneca PLC (being a holding company
for investment activities) and have determined
that net assets are an appropriate basis for the
calculation of the overall materiality level.
For each component in the scope of our Group audit, we allocated a materiality that is less than our overall Group materiality. The range of
materiality allocated across components was between $50m and $350m.
We use performance materiality to reduce
to an appropriately low level the probability
that the aggregate of uncorrected and
undetected misstatements exceeds overall
materiality. Specifically, we use performance
materiality in determining the scope of our
audit and the nature and extent of our testing
of account balances, classes of transactions
and disclosures, for example in determining
sample sizes. Our performance materiality
was 75% (2023: 75%) of overall materiality,
amounting to $375m (2023: $330m) for
the Group financial statements and
$116.25m (2023: $82.5m) for the
Company financial statements.
In determining the performance materiality,
we considered a number of factors – the
history of misstatements, risk assessment
and aggregation risk and the effectiveness
of controls – and concluded that an amount
at the upper end of our normal range
was appropriate.
We agreed with the Audit Committee that we
would report to them misstatements identified
during our audit above $50m (Group audit)
(2023: $22m) and $50m (Company audit)
(2023: $22m) as well as misstatements below
those amounts that, in our view, warranted
reporting for qualitative reasons.
Conclusions relating to going concern
Our evaluation of the directors’ assessment
of the Group’s and the Company’s ability to
continue to adopt the going concern basis
of accounting included:
•
agreeing the underlying cash flow
projections to Board approved Group
level budgets and forecasts, assessing
how these forecasts are compiled, and
assessing the accuracy of management’s
forecasts;
•
evaluating the key assumptions within
management’s forecasts and ensuring
that such assumptions are consistent with
those modelled in relation to impairments;
•
considering liquidity and available
financial resources;
•
assessing whether the stress testing
performed by management appropriately
considered the principal risks facing the
business; and
•
evaluating the feasibility of management’s
mitigating actions in the stress testing
scenarios and performing our own
sensitivities.
Based on the work we have performed, we
have not identified any material uncertainties
relating to events or conditions that,
individually or collectively, may cast
significant doubt on the Group’s and the
Company’s ability to continue as a going
concern for a period of at least twelve
months from when the financial statements
are authorised for issue.
In auditing the financial statements, we
have concluded that the directors’ use of
the going concern basis of accounting in
the preparation of the financial statements
is appropriate.
However, because not all future events or
conditions can be predicted, this conclusion
is not a guarantee as to the Group’s and the
Company’s ability to continue as a going
concern.
In relation to the directors’ reporting on
how they have applied the UK Corporate
Governance Code, we have nothing material
to add or draw attention to in relation to the
directors’ statement in the financial
statements about whether the directors
considered it appropriate to adopt the going
concern basis of accounting.
Our responsibilities and the responsibilities
of the directors with respect to going
concern are described in the relevant
sections of this report.
145
Financial Statements | Independent auditors’ report to the members of AstraZeneca PLC
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Reporting on other information
The other information comprises all of the
information in the Annual Report other than
the financial statements and our auditors’
report thereon. The directors are responsible
for the other information. Our opinion on the
financial statements does not cover the
other information and, accordingly, we do
not express an audit opinion or, except to
the extent otherwise explicitly stated in this
report, any form of assurance thereon.
In connection with our audit of the financial
statements, our responsibility is to read the
other information and, in doing so, consider
whether the other information is materially
inconsistent with the financial statements
or our knowledge obtained in the audit,
or otherwise appears to be materially
misstated. If we identify an apparent
material inconsistency or material
misstatement, we are required to perform
procedures to conclude whether there is
a material misstatement of the financial
statements or a material misstatement of
the other information. If, based on the work
we have performed, we conclude that there
is a material misstatement of this other
information, we are required to report that
fact. We have nothing to report based on
these responsibilities.
With respect to the Strategic Report and
Directors’ Report, we also considered
whether the disclosures required by the UK
Companies Act 2006 have been included.
Based on our work undertaken in the course
of the audit, the Companies Act 2006
requires us also to report certain opinions
and matters as described below.
Strategic report and Directors’ Report
In our opinion, based on the work
undertaken in the course of the audit, the
information given in the Strategic Report
and Directors’ Report for the year ended
31 December 2024 is consistent with the
financial statements and has been
prepared in accordance with applicable
legal requirements.
In light of the knowledge and understanding
of the Group and Company and their
environment obtained in the course of the
audit, we did not identify any material
misstatements in the Strategic Report
and Directors’ Report.
Directors’ Remuneration
In our opinion, the part of the Directors’
Remuneration Report to be audited has
been properly prepared in accordance
with the Companies Act 2006.
Corporate governance statement
The UK Listing Rules require us to review
the directors’ statements in relation to going
concern, longer-term viability and that part
of the corporate governance statement
relating to the Company’s compliance
with the provisions of the UK Corporate
Governance Code specified for our review.
Our additional responsibilities with respect
to the corporate governance statement as
other information are described in the
Reporting on other information section of
this report.
Based on the work undertaken as part of
our audit, we have concluded that each of
the following elements of the corporate
governance statement, included within the
Corporate Governance Overview, Corporate
Governance Report, Nomination and
Governance Committee Report, Science
Committee Report, Sustainability Committee
Report and Audit Committee Report is
materially consistent with the financial
statements and our knowledge obtained
during the audit, and we have nothing material
to add or draw attention to in relation to:
•
The directors’ confirmation that they
have carried out a robust assessment of
the emerging and principal risks;
•
The disclosures in the Annual Report that
describe those principal risks, what
procedures are in place to identify
emerging risks and an explanation of how
these are being managed or mitigated;
•
The directors’ statement in the financial
statements about whether they
considered it appropriate to adopt the
going concern basis of accounting in
preparing them, and their identification of
any material uncertainties to the Group’s
and Company’s ability to continue to do
so over a period of at least twelve months
from the date of approval of the financial
statements;
•
The directors’ explanation as to their
assessment of the Group’s and
Company’s prospects, the period this
assessment covers and why the period
is appropriate; and
•
The directors’ statement as to whether
they have a reasonable expectation that
the Company will be able to continue in
operation and meet its liabilities as they
fall due over the period of its assessment,
including any related disclosures drawing
attention to any necessary qualifications
or assumptions.
Our review of the directors’ statement
regarding the longer-term viability of the
Group and Company was substantially less
in scope than an audit and only consisted
of making inquiries and considering the
directors’ process supporting their
statement; checking that the statement is
in alignment with the relevant provisions
of the UK Corporate Governance Code;
and considering whether the statement is
consistent with the financial statements and
our knowledge and understanding of the
Group and Company and their environment
obtained in the course of the audit.
In addition, based on the work undertaken
as part of our audit, we have concluded that
each of the following elements of the
corporate governance statement is
materially consistent with the financial
statements and our knowledge obtained
during the audit:
•
The directors’ statement that they
consider the Annual Report, taken as
a whole, is fair, balanced and
understandable, and provides the
information necessary for the members
to assess the Group’s and Company’s
position, performance, business model
and strategy;
•
The section of the Annual Report that
describes the review of effectiveness
of risk management and internal control
systems; and
•
The section of the Annual Report
describing the work of the Audit
Committee.
We have nothing to report in respect of our
responsibility to report when the directors’
statement relating to the Company’s
compliance with the Code does not properly
disclose a departure from a relevant
provision of the Code specified under the
UK Listing Rules for review by the auditors.
Responsibilities for the financial
statements and the audit
Responsibilities of the directors for the
financial statements
As explained more fully in the Preparation
of the Financial Statements and Directors’
Responsibilities section, the directors are
responsible for the preparation of the financial
statements in accordance with the applicable
framework and for being satisfied that they
give a true and fair view. The directors are
also responsible for such internal control as
they determine is necessary to enable the
preparation of financial statements that are
free from material misstatement, whether
due to fraud or error.
In preparing the financial statements,
the directors are responsible for assessing
the Group’s and the Company’s ability to
continue as a going concern, disclosing, as
applicable, matters related to going concern
and using the going concern basis of
accounting unless the directors either
intend to liquidate the Group or the
Company or to cease operations, or have
no realistic alternative but to do so.
Auditors’ responsibilities for the audit
of the financial statements
Our objectives are to obtain reasonable
assurance about whether the financial
statements as a whole are free from material
misstatement, whether due to fraud or error,
and to issue an auditors’ report that includes
our opinion. Reasonable assurance is a high
level of assurance, but is not a guarantee
that an audit conducted in accordance with
146
AstraZeneca
Annual Report & Form 20-F Information 2024
Financial Statements
Independent auditors’ report to the members of AstraZeneca PLC
continued
ISAs (UK) will always detect a material
misstatement when it exists. Misstatements
can arise from fraud or error and are
considered material if, individually or in
the aggregate, they could reasonably be
expected to influence the economic
decisions of users taken on the basis of
these financial statements.
Irregularities, including fraud, are instances
of non-compliance with laws and
regulations. We design procedures in line
with our responsibilities, outlined above,
to detect material misstatements in respect
of irregularities, including fraud. The extent
to which our procedures are capable of
detecting irregularities, including fraud,
is detailed below.
Based on our understanding of the Group
and industry, we identified that the principal
risks of non-compliance with laws and
regulations related to patent protection,
product safety (including but not limited
to the US Food and Drug Administration
regulation, the European Medicines Agency,
the UK Medicines and Healthcare products
Regulatory Agency, China Food and Drug
Administration), data protection legislation,
antibribery and competition law (including
but not limited to the Foreign Corrupt
Practices Act, the Proceeds of Crime Act
and the provisions set out by the National
Healthcare Security Administration in China),
and we considered the extent to which
non-compliance might have a material effect
on the financial statements. We also
considered those laws and regulations that
have a direct impact on the financial
statements such as the Companies Act
2006, listing rules and tax legislation. We
evaluated management’s incentives and
opportunities for fraudulent manipulation of
the financial statements (including the risk of
override of controls) and determined that the
principal risks were related to journal entries
to manipulate financial results and potential
management bias in accounting estimates.
The Group engagement team shared this risk
assessment with the component auditors so
that they could include appropriate audit
procedures in response to such risks in their
work. Audit procedures performed by the
Group engagement team and/or component
auditors included:
•
Evaluation and testing of the design and
operating effectiveness of management’s
controls to prevent and detect
irregularities;
•
Discussions with VP Group Internal Audit,
the Deputy Chief Compliance Officer, the
Head of Global Investigations and the
Group’s General Counsel and Deputy
General Counsels along with other
members of Group legal and external
counsel where applicable, including
consideration of known or suspected
instances of non-compliance with laws
and regulations and fraud;
•
Assessment of matters reported on the
Group’s whistleblowing helpline;
•
Assessment of the results of
management’s investigations, with the
involvement of PwC Forensic specialists
where appropriate;
•
Challenging assumptions made by
management in its significant accounting
estimates, in particular in relation to the
recognition and measurement of certain
rebate accruals in the US (excluding Rare
Diseases), the impairment of intangible
assets (excluding goodwill and software
development costs), the recognition and
measurement of legal provisions and
disclosure of contingent liabilities, the
recognition and measurement of
uncertain tax treatments, and the
valuation of the defined benefit
obligations (see related key audit matters
above); and
•
Identifying and testing the validity of
selected journal entries, including certain
journal entries posted with unusual
account combinations, and certain
consolidation journals.
There are inherent limitations in the audit
procedures described above. We are
less likely to become aware of instances of
non-compliance with laws and regulations
that are not closely related to events and
transactions reflected in the financial
statements. Also, the risk of not detecting a
material misstatement due to fraud is higher
than the risk of not detecting one resulting
from error, as fraud may involve deliberate
concealment by, for example, forgery or
intentional misrepresentations, or
through collusion.
Our audit testing might include testing
complete populations of certain transactions
and balances, possibly using data auditing
techniques. However, it typically involves
selecting a limited number of items for
testing, rather than testing complete
populations. We will often seek to target
particular items for testing based on their
size or risk characteristics. In other cases, we
will use audit sampling to enable us to draw a
conclusion about the population from which
the sample is selected.
A further description of our responsibilities
for the audit of the financial statements
is located on the FRC’s website at:
www.frc.org.uk/auditorsresponsibilities.
This description forms part of our
auditors’ report.
Use of this report
This report, including the opinions, has
been prepared for and only for the
Company’s members as a body in
accordance with Chapter 3 of Part 16 of the
Companies Act 2006 and for no other
purpose. We do not, in giving these
opinions, accept or assume responsibility
for any other purpose or to any other person
to whom this report is shown or into whose
hands it may come save where expressly
agreed by our prior consent in writing.
Other required reporting
Companies Act 2006 exception reporting
Under the Companies Act 2006 we are
required to report to you if, in our opinion:
•
we have not obtained all the information
and explanations we require for our audit;
or
•
adequate accounting records have not
been kept by the Company, or returns
adequate for our audit have not been
received from branches not visited by us;
or
•
certain disclosures of directors’
remuneration specified by law are not
made; or
•
the Company financial statements and
the part of the Directors’ Remuneration
Report to be audited are not in agreement
with the accounting records and returns.
We have no exceptions to report arising
from this responsibility.
Appointment
Following the recommendation of the Audit
Committee, we were appointed by the
members on 27 April 2017 to audit the
financial statements for the year ended
31 December 2017 and subsequent financial
periods. The period of total uninterrupted
engagement is eight years, covering the
years ended 31 December 2017 to
31 December 2024.
Other matter
The Company is required by the Financial
Conduct Authority Disclosure Guidance
and Transparency Rules to include these
financial statements in an annual financial
report prepared under the structured digital
format required by DTR 4.1.15R – 4.1.18R and
filed on the National Storage Mechanism of
the Financial Conduct Authority. This
auditors’ report provides no assurance over
whether the structured digital format annual
financial report has been prepared in
accordance with those requirements.
Sarah Quinn (Senior Statutory Auditor)
for and on behalf of
PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
London
6 February 2025
147
Financial Statements | Independent auditors’ report to the members of AstraZeneca PLC
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Consolidated Statement of Comprehensive Income
for the year ended 31 December
2024
2023
2022
Notes
$m
$m
$m
Product Sales
1
Alliance Revenue
1
Collaboration Revenue
1
Total Revenue
Cost of sales
(10,207 )
(8,268 )
(12,391 )
Gross profit
Distribution expense
(555 )
(539 )
(536 )
Research and development expense
2
(13,583 )
(10,935 )
(9,762 )
Selling, general and administrative expense
2
(19,977 )
(19,216 )
(18,419 )
Other operating income and expense
2
Operating profit
Finance income
3
Finance expense
3
(1,742 )
(1,626 )
(1,346 )
Share of after tax losses in associates and joint ventures
11
(28 )
(12 )
(5 )
Profit before tax
Taxation
4
(1,650 )
(938 )
Profit for the period
Other comprehensive income:
Items that will not be reclassified to profit and loss:
Remeasurement of the defined benefit pension liability
22
(406 )
Net gains/(losses) on equity investments measured at fair value through Other comprehensive income
(88 )
Fair value movements related to own credit risk on bonds designated as fair value through profit or loss
(6 )
Tax on items that will not be reclassified to profit and loss
4
(43 )
(216 )
(33 )
Items that may be reclassified subsequently to profit and loss:
Foreign exchange arising on consolidation
23
(957 )
(1,446 )
Foreign exchange arising on designated liabilities in net investment hedges
23
(122 )
(282 )
Fair value movements on cash flow hedges
(129 )
(97 )
Fair value movements on cash flow hedges transferred to profit and loss
(145 )
Fair value movements on derivatives designated in net investment hedges
23
(8 )
Costs of hedging
(21 )
(19 )
(7 )
Tax on items that may be reclassified subsequently to profit and loss
4
(12 )
(988 )
(1,694 )
Other comprehensive (expense)/income for the period, net of tax
(800 )
(878 )
Total comprehensive income for the period
Profit attributable to:
Owners of the Parent
Non-controlling interests
26
Total comprehensive income attributable to:
Owners of the Parent
Non-controlling interests
26
Basic earnings per $0.25
5
$4.54
$3.84
$2.12
Diluted earnings per $0.25
5
$4.50
$3.81
$2.11
Weighted average number of Ordinary Shares in issue (millions)
5
Diluted weighted average number of Ordinary Shares in issue (millions)
5
Dividends declared and paid in the period
25
All activities were in respect of continuing operations.
$m means millions of US dollars.
148
AstraZeneca
Annual Report & Form 20-F Information 2024
Financial Statements
Consolidated Statement of Financial Position
at 31 December
2024
2023
2022
Notes
$m
$m
$m
Assets
Non-current assets
Property, plant and equipment
7
Right-of-use assets
8
Goodwill
9
Intangible assets
10
Investments in associates and joint ventures
11
Other investments
12
Derivative financial instruments
13
Other receivables
14
Deferred tax assets
4
Current assets
Inventories
15
Trade and other receivables
16
Other investments
12
Derivative financial instruments
13
Income tax receivable
Cash and cash equivalents
17
Assets held for sale
18
Total assets
Liabilities
Current liabilities
Interest-bearing loans and borrowings
19
(2,337 )
(5,129 )
(5,314 )
Lease liabilities
8
(339 )
(271 )
(228 )
Trade and other payables
20
(22,465 )
(22,374 )
(19,040 )
Derivative financial instruments
13
(50 )
(156 )
(93 )
Provisions
21
(1,269 )
(1,028 )
(722 )
Income tax payable
(1,406 )
(1,584 )
(896 )
(27,866 )
(30,542 )
(26,293 )
Non-current liabilities
Interest-bearing loans and borrowings
19
(26,506 )
(22,365 )
(22,965 )
Lease liabilities
8
(1,113 )
(857 )
(725 )
Derivative financial instruments
13
(115 )
(38 )
(164 )
Deferred tax liabilities
4
(3,305 )
(2,844 )
(2,944 )
Retirement benefit obligations
22
(1,330 )
(1,520 )
(1,168 )
Provisions
21
(921 )
(1,127 )
(896 )
Income tax payable
(238 )
Other payables
20
(1,770 )
(2,660 )
(4,270 )
(35,298 )
(31,411 )
(33,132 )
Total liabilities
(63,164 )
(61,953 )
(59,425 )
Net assets
Equity
Capital and reserves attributable to equity holders of the Company
Share capital
24
Share premium account
Capital redemption reserve
Merger reserve
Other reserves
23
Retained earnings
23
(574 )
Non-controlling interests
26
Total equity
Pascal Soriot
Aradhana Sarin
Director
Director
149
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
for the year ended 31 December
Share
Capital
Total
Non-
Share
premium redemption
Merger
Other
Retained
attributable
controlling
Total
capital
account
reserve
reserve
reserves
earnings
to owners
interests
equity
$m
$m
$m
$m
$m
$m
$m
$m
$m
At 1 January 2022
Profit for the period
Other comprehensive expense
1
(875 )
(875 )
(3 )
(878 )
Transfer to other reserves
2
(24 )
Transactions with owners
Dividends (Note 25)
(4,485 )
(4,485 )
(4,485 )
Issue of Ordinary Shares
Share-based payments charge for the period (Note 29)
Settlement of share plan awards
(807 )
(807 )
(807 )
Net movement
(2,284 )
(2,231 )
(2,229 )
At 31 December 2022
(574 )
Profit for the period
Other comprehensive income
1
Transfer to other reserves
2
(4 )
Transactions with owners
Dividends (Note 25)
(4,487 )
(4,487 )
(4,487 )
Dividends paid to non-controlling interests (Note 25)
(4 )
(4 )
Issue of Ordinary Shares
Share-based payments charge for the period (Note 29)
Settlement of share plan awards
(708 )
(708 )
(708 )
Net movement
(4 )
At 31 December 2023
Profit for the period
Other comprehensive expense
1
(799 )
(799 )
(1 )
(800 )
Transfer to other reserves
2
(15 )
Transactions with owners
Dividends (Note 25)
(4,602 )
(4,602 )
(4,602 )
Dividends paid to non-controlling interests (Note 25)
(4 )
(4 )
Issue of Ordinary Shares
Changes in non-controlling interests
Movement in shares held by Employee Benefit Trusts
2
(68 )
(68 )
(68 )
Share-based payments charge for the period (Note 29)
Settlement of share plan awards
(621 )
(621 )
(621 )
Net movement
(53 )
At 31 December 2024
1
Included within Other comprehensive expense of $800 m (2023: income of $733 m; 2022: expense of $878 m) is a charge of $21 m (2023: $19 m; 2022: $7 m), relating to Costs of hedging.
2
Amounts charged or credited to other reserves relate to exchange adjustments arising on goodwill and movements in shares held by Employee Benefit Trusts.
150
AstraZeneca
Annual Report & Form 20-F Information 2024
Financial Statements
for the year ended 31 December
2024
2023
2022
Notes
$m
$m
$m
Cash flows from operating activities
Profit before tax
Finance income and expense
3
Share of after tax losses of associates and joint ventures
11
Depreciation, amortisation and impairment
Increase in trade and other receivables
(1,624 )
(1,425 )
(1,349 )
(Increase)/decrease in inventories
(131 )
(669 )
Increase in trade and other payables and provisions
Gains on disposal of intangible assets
2
(64 )
(251 )
(104 )
Fair value movements on contingent consideration arising from business combinations
20
Non-cash and other movements
17
(121 )
(386 )
(692 )
Cash generated from operations
Interest paid
(1,313 )
(1,081 )
(849 )
Tax paid
(2,750 )
(2,366 )
(1,623 )
Net cash inflow from operating activities
Cash flows from investing activities
Acquisition of subsidiaries, net of cash acquired
27
(2,771 )
(189 )
(48 )
Payments upon vesting of employee share awards attributable to business combinations
27
(3 )
(84 )
(215 )
Payment of contingent consideration from business combinations
20
(1,008 )
(826 )
(772 )
Purchase of property, plant and equipment
(1,924 )
(1,361 )
(1,091 )
Disposal of property, plant and equipment
Purchase of intangible assets
(2,662 )
(2,417 )
(1,480 )
Disposal of intangible assets
Movement in profit-participation liability
2
Purchase of non-current asset investments
(96 )
(136 )
(45 )
Disposal of non-current asset investments
Movement in short-term investments, fixed deposits and other investing instruments
(114 )
Payments to associates and joint ventures
11
(158 )
(80 )
(26 )
Disposal of investments in associates and joint ventures
Interest received
Net cash outflow from investing activities
(7,980 )
(4,064 )
(2,960 )
Net cash inflow before financing activities
Cash flows from financing activities
Proceeds from issue of share capital
Own shares purchased by Employee Benefit Trusts
(81 )
Issue of loans and borrowings
Repayment of loans and borrowings
(4,652 )
(4,942 )
(1,271 )
Dividends paid
25
(4,629 )
(4,481 )
(4,364 )
Hedge contracts relating to dividend payments
25
(19 )
(127 )
Repayment of obligations under leases
(316 )
(268 )
(244 )
Movement in short-term borrowings
(31 )
Payment of Acerta Pharma share purchase liability
(833 )
(867 )
(920 )
Net cash outflow from financing activities
(3,996 )
(6,567 )
(6,823 )
Net (decrease)/increase in Cash and cash equivalents in the period
(115 )
(286 )
Cash and cash equivalents at the beginning of the period
Exchange rate effects
(93 )
(60 )
(80 )
Cash and cash equivalents at the end of the period
17
151
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Consolidated Statement of Cash Flows
Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
152
of financial information
have been prepared under the historical
cost convention, modified to include
revaluation to fair value of certain financial
instruments and pension plan assets and
liabilities as described below, in accordance
with UK-adopted international accounting
standards and with the requirements of
the Companies Act 2006 as applicable to
companies reporting under those standards.
The Consolidated Financial Statements also
comply fully with IFRS Accounting Standards
as issued by the International Accounting
Standards Board (IASB) and International
Accounting Standards as adopted by the
European Union.
The Consolidated Financial Statements
are presented in US dollars, which is the
Company’s functional currency.
In preparing their individual financial
statements, the accounting policies of some
overseas subsidiaries do not conform with
IASB-issued IFRSs. Therefore, where
appropriate, adjustments are made in order
to present the Consolidated Financial
New accounting requirements
The following amendments and interpretations
have been issued and adopted:
•
amendments to IAS 1 ‘Presentation
of Financial Statements’, effective for
periods beginning on or after 1 January
2024 – endorsed by the United Kingdom
Endorsement Board (UKEB) on 21 July 2023
•
amendments to IFRS 16 ‘Leases’,
effective for periods beginning on or
after 1 January 2024 – endorsed by the
UKEB on 11 May 2023
•
amendments to IAS 7 ‘Statement of Cash
Flows’, effective for periods beginning on
or after 1 January 2024 – endorsed by the
UKEB on 28 November 2023
•
amendments to IFRS 7 ‘Financial
Instruments’, effective for periods beginning
on or after 1 January 2024 – endorsed by
the UKEB on 28 November 2023.
The above amendments and interpretations
did not have a significant impact on the
Group’s net results, net assets or disclosures.
Employee Benefit Trusts
Following an amendment to the Employee
Benefit Trust (EBT) Deed on 10 June 2024,
AstraZeneca obtained control and
commenced consolidation of the EBT
from June 2024. From that date, cash paid
on purchases of AstraZeneca Ordinary
shares or American Depository Receipts is
presented within Financing activities in the
Consolidated Statement of Cash Flows.
Statements on a going concern basis
The Group has considerable financial
resources available. As at 31 December 2024,
the Group has $10.4bn in financial resources
(cash and cash equivalent balances of $5.5bn
and undrawn committed bank facilities of
$4.9bn that were available until April 2029),
with $2.7bn of borrowings due within one
year. These facilities contain no financial
covenants, and in January 2025 their
maturity was extended to April 2030.
The Group has assessed the prospects of the
Group over a period longer than the required
12 months from the date of Board approval
of these Consolidated Financial Statements,
with no deterioration noted requiring a
further extension of this review. The Group’s
revenues are largely derived from sales of
medicines covered by patents, which
provide a relatively high level of resilience
and predictability to cash inflows, although
government price interventions in response
to budgetary constraints are expected to
continue to adversely affect revenues in
some of our significant markets. The Group,
however, anticipates new revenue streams
from both recently launched medicines and
those in development, and the Group has a
wide diversity of customers and suppliers
across different geographic areas.
Consequently, the Directors believe that,
overall, the Group is well placed to manage
its business risks successfully. Accordingly,
they continue to adopt the going concern
basis in preparing the Annual Report and
The preparation of the Financial Statements
in conformity with generally accepted
accounting principles requires management
to make estimates and judgements that
affect the reported amounts of assets and
liabilities at the date of the Financial
Statements and the reported amounts of
revenues and expenses during the reporting
period. Actual results could differ from
those estimates.
The accounting policy descriptions set out the
areas where judgements and estimates need
exercising, the most significant of which
include the following Key Judgements
KJ
and Significant Estimates
SE
:
•
revenue recognition – see Revenue
accounting policy on page 153
KJ
and Note 1 on page 160
SE
•
expensing of internal development
expenses – see Research and development
accounting policy on page 154
KJ
•
impairment reviews of Intangible assets
– see Note 10 on page 173
SE
•
useful economic life of Intangible assets
– see Research and development
accounting policy on page 154
KJ
•
business combinations and Goodwill –
see Business combinations and goodwill
accounting policy on page 157
KJ
•
litigation liabilities – see Litigation and
Environmental Liabilities within Note 30
on page 205
KJ
•
operating segments – see Note 6 on
page 166
KJ
•
employee benefits – see Note 22 on
page 190
SE
•
taxation – see Note 30 on page 211
KJ
.
The Group has assessed the impact of
sustainability topics on its financial reporting.
This includes an impact assessment on the
valuation and useful lives of Intangible assets
and the identification and measurement
of provisions and contingent liabilities in
response to climate and pollution risks.
Sustainability-related opportunities on
innovation are integral to the Financial
Statements with a key indicator of the Group’s
investment being R&D expense. Business
conduct and patient safety are both
considered as part of our recognition and
measurement of provisions and contingent
liabilities, noted within sections of
Government investigations and proceedings
and Product liability litigation as relevant, of
Note 30. No material accounting impacts or
changes to judgements or other required
disclosures were noted.
KJ
Key Judgements are those judgements
made in applying the Group’s accounting
policies that have a material effect on the
amounts of assets and liabilities recognised
in the Financial Statements.
SE
A Significant Estimate has a significant
risk of material adjustment to the carrying
amounts of assets and liabilities within the
next financial year.
Financial risk management policies are
detailed in Note 28 to the Financial
Statements from page 194.
AstraZeneca’s management considers the
following to be the material accounting policies
Revenue comprises Product Sales, Alliance
Revenue and Collaboration Revenue.
Revenue excludes inter-company revenues
and value-added taxes.
Product Sales
Product Sales represent net invoice value less
estimated rebates, returns and chargebacks,
which are considered to be variable
consideration and include significant
estimates. Sales are recognised when the
control of the goods has been transferred to
a third party. This is usually when title passes
to the customer, either on shipment or on
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Group Accounting Policies
AstraZeneca
Annual Report & Form 20-F Information 2024
153
receipt of goods by the customer, depending
on local trading terms. Revenue is not
recognised in full until it is highly probable
that a significant reversal in the amount of
cumulative revenue recognised will not occur.
Rebates are amounts payable or credited to
a customer, usually based on the quantity or
value of Product Sales to the customer for
specific products in a certain period. Product
Sales rebates, which relate to Product Sales
that occur over a period of time, are normally
issued retrospectively.
At the time Product Sales are invoiced, rebates
and deductions that the Group expects to
pay are estimated based upon assumptions
developed using contractual terms, historical
experience and market-related information.
The rebates and deductions are recognised
as variable consideration and recorded as a
reduction to revenue with an accrual recorded.
These rebates typically arise from sales
contracts with government payers, third-
party managed care organisations, hospitals,
long-term care facilities, group purchasing
organisations and various state programmes.
In markets where returns are significant,
estimates of the quantity and value of
goods which may ultimately be returned
are accounted for at the point revenue is
recognised. Our returns accruals are based
on actual experience over the preceding
12 months for established products together
with market-related information such as
estimated stock levels at wholesalers and
competitor activity which we receive via
third-party information services. For newly
launched products, we use rates based on
our experience with similar products or a
predetermined percentage.
When a product faces generic competition,
particular attention is given to the possible
levels of returns and, in cases where the
circumstances are such that the level of
Product Sales are considered highly probable
to reverse, revenues are only recognised
when the right of return expires, which is
generally on ultimate prescription of the
product to patients.
The methodology and assumptions used to
estimate rebates and returns are monitored
and adjusted regularly in the light of
contractual and legal obligations, historical
trends, past experience and projected
market conditions. Once the uncertainty
associated with returns is resolved, revenue
is adjusted accordingly.
Under certain collaboration agreements
which include a profit sharing mechanism,
our recognition of Product Sales depends
on which party acts as principal in sales
to the end customer. In the cases where
AstraZeneca acts as principal, we record
100% of sales to the end customer. In the
cases where AstraZeneca does not act as
principal, we record the share of gross
profits received within Alliance Revenue.
Contracts relating to the supply of certain
Vaccines & Immune Therapies medicines
relating to the COVID-19 pandemic include
conditions whereby payments are receivable
from customers in advance of the delivery
of product. Such amounts are held on the
Statement of Financial Position as contract
liabilities until the related revenue is
recognised, generally upon product delivery.
Certain of these contracts contain further
provisions that restrict the use of inventory
manufactured in specified supply chains
to specified customers, resulting in an
enforceable right to payment as the activities
are performed. Under IFRS 15 ‘Revenue from
Contracts with Customers’, such contracts
require revenue to be recognised over time
using an appropriate and reasonably
measurable method to measure progress.
Revenue is recognised on these contracts
based on the proportion of product delivered
compared to the total contracted volumes.
Certain arrangements include bill-and-hold
arrangements under which the Group
invoices a customer for a product but retains
physical possession of the product until it is
transferred to the customer at a point in time
in the future. For these types of arrangements,
an assessment is made to determine when
the performance obligation has been
satisfied, which is when control of the product
is transferred to the customer. If the customer
has obtained control of the product even
though that product remains in the Group’s
physical possession, the performance
obligation to transfer a product has been
satisfied and Product Sales are recognised.
Control is considered to have transferred
when the reason for the bill-and-hold
arrangement is substantive, the product can
be identified separately as belonging to the
customer, the product is ready for physical
transfer to the customer and AstraZeneca
is unable to use or sell the product to
another customer.
Alliance Revenue
Alliance Revenue comprises income arising
from the ongoing operation of collaborative
arrangements related to sales made by
collaboration partners, where AstraZeneca is
entitled to a share of gross profits, share of
revenues or royalties, which are recurring in
nature while the collaboration agreement
remains in place. Alliance Revenue does not
include Product Sales where AstraZeneca
is leading commercialisation in a territory,
or reimbursement for AstraZeneca-incurred
expenses such as R&D or promotion
costs, which arise from the license of
intellectual property.
The Group periodically enters into transactions
where it acquires part of the rights to a
product intangible (either on-market or
in-process R&D), but for commercial reasons
does not act as principal in selling the
product to the customer and therefore does
not recognise income from the product in
the form of Product Sales. This may occur
where, for example, a collaboration partner
retains the right to commercialise in a
specific territory, and has sufficient local
control over that commercialisation to book
Product Sales, while the Group instead
receives a proportion of the value generated
by those Product Sales, either in the form of
a share of gross profits, a share of revenues
or a royalty. This revenue is recognised
when the Group’s right to receive the share
of the collaboration partner’s income is
established and can be reliably measured.
Where an out-licensing arrangement meets
the definition of a licence agreement, sales
royalties are recognised when achieved by
applying the royalty exemption under IFRS 15.
Where the arrangement meets the definition
of a licence agreement, share of gross
profits, share of revenues and sales royalties
are recognised when achieved by applying
the royalty exemption under IFRS 15. All other
sales royalties are recognised when
considered it is highly probable there will not
be a significant reversal of cumulative
income. The determination requires estimates
to be made in relation to future Product Sales.
Collaboration Revenue
Collaboration Revenue includes income
arising from entering into collaborative
arrangements where the Group has
out-licensed (sold) certain rights associated
with products and where AstraZeneca
retains a significant ongoing economic
interest in the product. Significant interest
can include ongoing supply of finished
goods, profit sharing arrangements or being
principal in the sales of medicines. These
collaborations may include development,
manufacturing and/or commercialisation
arrangements with the collaborator. Income
from out-licences may take the form of
upfront fees and milestones.
KJ
Timing of recognition of clinical and
regulatory milestones is considered to be
a Key Judgement. There can be significant
uncertainty over whether it is highly probable
that there would not be a significant reversal
of revenue in respect of specific milestones
if these are recognised before they are
triggered due to them being subject to the
actions of third parties. In general, where
the triggering of a milestone is subject to
the decisions of third parties (e.g. the
acceptance or approval of a filing by a
regulatory authority), the Group does not
consider that the threshold for recognition
is met until that decision is made.
Financial Statements
Group Accounting Policies
continued
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Where Collaboration Revenue arises from
the licensing of the Group’s own intellectual
property, the licences we grant are typically
rights to use intellectual property which do
not change during the period of the licence
and therefore related non-conditional
revenue is recognised at the point the
licence is granted and variable consideration
as soon as recognition criteria are met.
Other performance obligations in the contract
might include the supply of product. These
arrangements typically involve the receipt
of an upfront payment, which the contract
attributes to the license of the intangible
assets, and ongoing receipts for supply,
which the contract attributes to the sale of
the product we manufacture. In cases where
the transaction has two or more components,
we account for the delivered item (for
example, the transfer of title to the intangible
asset) as a separate unit of account and
record revenue on delivery of that component.
Where practicable, consideration is allocated
to performance obligations on the basis of the
standalone selling price of each performance
obligation. However, where there is a licence
of intellectual property, it is not always
possible to establish a reliable estimate of
the standalone selling price of the licence
as they are unique. Therefore, in these rare
situations, the residual approach is used to
determine the consideration attributable
to the licence.
Where fixed amounts are payable over one
year from the effective date of a contract,
an assessment is made as to whether a
significant financing component exists,
and if so, the fair value of this component is
deferred and recognised as financing income
over the period to the expected date of receipt.
Where control of a right-to-use licence for an
intangible asset passes at the outset of an
arrangement, revenue is recognised at the
point in time control is transferred. Where
the substance of a licence arrangement is
that of a right-to-access rights attributable
to an intangible asset, revenue, in the form
of an upfront fee, is recognised over time,
normally on a straight-line basis over the life
of the contract. Where the Group provides
ongoing development services, revenue in
respect of this element is recognised over
the duration of those services.
Where Collaboration Revenue is recorded
and there is a related intangible asset that
is licensed as part of the arrangement, an
appropriate amount of that intangible asset
is charged to Cost of sales based on an
allocation of cost or value to the rights that
Cost of sales are recognised as the associated
revenue is recognised. Cost of sales include
manufacturing costs, royalties payable
on revenues recognised, movements in
provisions for inventories, inventory write-
offs and impairment charges in relation to
manufacturing assets. Cost of sales also
includes co-collaborator sharing of profit
arising from collaborations, and foreign
exchange gains and losses arising from
business trading activities.
Research expenditure is charged to profit
and loss in the year in which it is incurred.
KJ
Internal development expenditure is
capitalised only if it meets the recognition
criteria of IAS 38 ‘Intangible Assets’. This
is considered a Key Judgement. Where
regulatory and other uncertainties are such
that the criteria are not met, the expenditure
is charged to profit and loss and this is
almost invariably the case prior to approval
of the drug by the relevant regulatory
authority. Where, however, recognition
criteria are met, Intangible assets are
capitalised and amortised on a straight-line
basis over their useful economic lives from
product launch. At 31 December 2024, no
amounts have met the recognition criteria.
Payments to in-license products and
compounds from third parties for new
research and development projects (in
process research and development) generally
take the form of upfront payments, milestones
and royalty payments. Where payments made
to third parties represent consideration for
future research and development activities,
an evaluation is made as to the nature of
the payments. Such payments are expensed
if they represent compensation for sub-
contracted research and development
services not resulting in a transfer of
intellectual property. By contrast, payments
are capitalised if they represent compensation
for the transfer of identifiable intellectual
property developed at the risk of the third
party. Such payments may be made once
development or regulatory milestones are
met and may also be made on the basis of
sales volumes once a product is launched.
Development and regulatory milestone
payments are capitalised as the milestone
is triggered. Sales-related payments are
accrued and capitalised with reference to
the latest Group sales forecasts for approved
indications at the present value of expected
future cash flows. Assets capitalised are
amortised, on a straight-line basis, over their
useful economic lives from product launch.
KJ
The determination of useful economic
life is considered to be a Key Judgement.
On product launch, the Group makes
a judgement as to the expected useful
economic life with reference to the expiry
of associated patents for the product,
expectation around the competitive
environment specific to the product and
our detailed long-term risk-adjusted sales
projections compiled annually across the
Group and approved by the Board.
The useful economic life can extend beyond
patent expiry dependent upon the nature
of the product and the complexity of the
development and manufacturing process.
Significant sales can often be achieved
Intangible assets are stated at cost less
accumulated amortisation and impairments.
Intangible assets relating to products in
development are subject to impairment testing
annually. All Intangible assets are tested for
impairment when there are indications that
the carrying value may not be recoverable.
The determination of the recoverable
amounts includes key estimates which are
highly sensitive to, and depend upon, key
assumptions as detailed in Note 10 to the
Financial Statements from page 172.
Impairment reviews have been carried out on
all Intangible assets that are in development
(and not being amortised), all major intangible
assets acquired during the year and all other
intangible assets that have had indicators
of impairment during the year. Recoverable
amount is determined as the higher of
value-in-use or fair value less costs to sell
using a discounted cash flow calculation, with
the products’ expected cash flows risk-
adjusted over their estimated remaining useful
economic life. Sales forecasts and specific
allocated costs (which have both been
subject to appropriate senior management
review and approval) are risk-adjusted and
discounted using appropriate rates based
on our post-tax weighted average cost of
capital or for fair value less costs to sell,
a required rate of return for a market
participant. Our weighted average cost of
capital reflects factors such as our capital
structure and our costs of debt and equity.
Any impairment losses are recognised
immediately in Operating profit. Intangible
assets relating to products which fail during
development (or for which development
ceases for other reasons) are also tested for
impairment and are written down to their
recoverable amount (which is usually nil).
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Group Accounting Policies
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Annual Report & Form 20-F Information 2024
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If, subsequent to an impairment loss being
recognised, development restarts or other
facts and circumstances change indicating
that the impairment is less or no longer exists,
the value of the asset is re-estimated and its
carrying value is increased to the recoverable
amount, but not exceeding the original value,
by recognising an impairment reversal in
Government grants are recognised in the
Consolidated Statement of Comprehensive
Income so as to match with the related
expenses that they are intended to
compensate. Where grants are received
in advance of the related expenses, they
are initially recognised in the Consolidated
Statement of Financial Position under Trade
and other payables as deferred income
and released to net off against the related
expenditure when incurred.
Each contract is assessed to determine
whether there are both grant elements and
supply of product which need to be separated.
In each case, the contracts set out the
specified terms for the supply of the product
and the provisions for funding for certain
costs, primarily research and development
associated with the IP. It is considered
whether there are any conditions for the
funding to be refunded. The consideration in
the contract is allocated between the grant
and supply elements. The standalone selling
price for the supply of products is determined
by reference to observed prices with other
customers. The amount allocated as a
government grant is determined by reference
to the specific agreed costs and activities
identified in the contract as not directly
attributable to the supply of product.
Government grants are recorded as an offset
to the relevant expense in the Consolidated
Statement of Comprehensive Income and are
Other operating income and expense
Other operating income and expense is
generated from activities outside of the
Group’s normal course of business, which
includes Other income from divestments of
or full out-license of assets and businesses
including royalties and milestones where the
Group does not retain a significant continued
interest. Where the arrangement meets the
definition of a licence agreement, sales
milestones and sales royalties are recognised
when achieved by applying the royalty
exemption under IFRS 15 ‘Revenue from
Contracts with Customers’. All other
milestones and sales royalties are recognised
when it is considered highly probable that
there will not be a significant reversal of
cumulative income. The determination
requires estimates to be made in relation
The Group has arrangements over which it
has joint control and which qualify as joint
operations or joint ventures under IFRS 11
‘Joint Arrangements’. For joint operations,
the Group recognises its share of revenue
that it earns from the joint operations and
its share of expenses incurred. The Group
also recognises the assets associated with
the joint operations that it controls and the
liabilities it incurs under the joint arrangement.
For joint ventures and associates, the Group
recognises its interest in the joint venture or
associate as an investment and uses the
The Group accounts for pensions and other
employee benefits (principally healthcare)
under IAS 19 ‘Employee Benefits’. In respect
of defined benefit plans, obligations are
determined using the projected unit credit
method and are discounted to present value
by reference to market yields on high-quality
corporate bonds, while plan assets are
measured at fair value. Given the extent of
the assumptions used to determine the value
of scheme assets and scheme liabilities,
these are considered to be significant
estimates. The operating and financing costs
of such plans are recognised separately
in profit and loss; current service costs
are spread systematically over the lives
of employees and financing costs are
recognised in full in the periods in which they
arise. Remeasurements of the net defined
benefit pension liability, including actuarial
gains and losses, are recognised immediately
in Other comprehensive income.
Where the calculation results in a surplus to
the Group, the recognised asset is limited
to the present value of any available future
refunds from the plan or reductions in
future contributions to the plan subject to
consideration of the effect any minimum
funding requirement for future service has
on the benefit available as a reduction in
future contributions.
Payments to defined contribution plans are
The current tax payable is based on taxable
profit for the year. Taxable profit differs
from reported profit because taxable profit
excludes items that are either never taxable
or tax deductible or items that are taxable
or tax deductible in a different period. The
Group’s current tax assets and liabilities
are calculated using tax rates that have
been enacted or substantively enacted
by the reporting date. Current tax includes
the Group’s charge for any Pillar Two
income taxes.
sheet liability method, providing for temporary
differences between the carrying amounts of
assets and liabilities for financial reporting
purposes and the amounts used for taxation
purposes. Deferred tax liabilities are
recognised unless they arise from the initial
recognition (other than in a business
combination) of assets and liabilities in a
transaction that affects neither the taxable
profit nor the accounting profit. Deferred tax
liabilities are not recognised to the extent they
arise from the initial recognition of non-tax
deductible goodwill. Deferred tax assets are
recognised to the extent that there are future
taxable temporary differences or it is probable
that future taxable profit will be available
against which the asset can be utilised. This
requires judgements to be made in respect
of the availability of future taxable income.
The Group applies the exception to
recognising and disclosing information about
deferred tax assets and liabilities related to
Pillar Two income taxes, as provided in the
amendments to IAS 12 ‘Income Taxes’
issued in May 2023.
No deferred tax asset or liability is recognised
in respect of temporary differences
associated with investments in subsidiaries
and branches where the Group is able to
control the timing of reversal of the temporary
differences and it is probable that the
temporary differences will not reverse in the
foreseeable future.
The Group’s deferred tax assets and liabilities
are calculated using tax rates that are
expected to apply in the period when the
liability is settled or the asset realised based
on tax rates that have been enacted or
substantively enacted by the reporting date.
Deferred tax liabilities relating to assets
recognised because of a business
combination which may qualify for intellectual
property incentives are measured at the
relevant statutory tax rate. Deferred tax assets
and liabilities are offset in the Consolidated
Statement of Financial Position if, and only if,
the taxable entity has a legally enforceable
right to set off current tax assets and
liabilities, and the Deferred tax assets and
liabilities relate to taxes levied by the same
Liabilities for uncertain tax positions require
management to make judgements of potential
exposures in relation to tax audit issues.
Tax benefits are not recognised unless the
tax positions will probably be accepted by
the tax authorities. This is based upon
management’s interpretation of applicable
laws and regulations and the expectation of
how the tax authority will resolve the matter.
Once considered probable of not being
accepted, management reviews each material
tax benefit and reflects the effect of the
uncertainty in determining the related
taxable result.
Financial Statements
Group Accounting Policies
continued
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Annual Report & Form 20-F Information 2024
156
Liabilities for uncertain tax positions are
measured using either the most likely amount
or the expected value amount depending on
which method the entity expects to better
predict the resolution of the uncertainty.
Further details of the estimates and
assumptions made in determining our
recorded liability for transfer pricing
contingencies and other tax contingencies
are included in Note 30 to the Financial
All plans have been classified as equity
settled after assessment. The grant date
fair value of the market-based performance
elements of employee share plan awards is
calculated using a modified Monte Carlo
model, with other elements at market price.
In accordance with IFRS 2 ‘Share-based
Payment’, the resulting cost is recognised in
profit on a straight-line basis over the vesting
period of the awards. The value of the charge
is adjusted to reflect expected and actual
levels of awards vesting, except where the
failure to vest is as a result of not meeting
a market condition. Cancellations of equity
instruments are treated as an acceleration
of the vesting period and any outstanding
charge is recognised in profit immediately.
Cash outflows relating to the purchase of
shares by consolidated Employee Benefit
Trusts (EBTs) relating to the vesting of share
plans are recognised within financing
activities. Cash outflows relating to the
employer and employee taxes paid on
vesting of share plans are recognised in
operating activities as they relate to employee
remuneration. The cash flows relating to
replacement awards issued to employees as
part of the Alexion acquisition are classified
within investing activities, as they are part
of the aggregate cash flows arising from
The Group’s policy is to depreciate the
difference between the cost of each item of
Property, plant and equipment and its residual
value over its estimated useful life on a
straight-line basis. Assets under construction
are not depreciated until the asset is
available for use, at which point the asset is
transferred into either Land and buildings or
Plant and equipment, and depreciated over
its estimated useful economic life.
Reviews are made annually of the estimated
remaining lives and residual values of
individual productive assets, taking
account of commercial and technological
obsolescence as well as normal wear and
tear. It is impractical to calculate average
asset lives exactly. However, the useful
economic lives range from approximately
10 to 50 years for buildings, and three to 15
years for plant and equipment. All items of
Property, plant and equipment are tested for
impairment when there are indications that
the carrying value may not be recoverable.
Any impairment losses are recognised
The Group’s lease arrangements are
principally for property, most notably
a portfolio of office premises and employee
accommodation, and for a global car
fleet, utilised primarily by our sales and
marketing teams.
The lease liability and corresponding
right-of-use asset arising from a lease are
initially measured on a present value basis.
Lease liabilities include the net present
value of the following lease payments:
•
fixed payments, less any lease
incentives receivable
•
variable lease payments that depend on an
index or a rate, initially measured using the
index or rate as at the commencement date
•
the exercise price of a purchase option if
the Group is reasonably certain to exercise
that option
•
payments of penalties for terminating the
lease, if the lease term reflects the Group
exercising that option, and
•
amounts expected to be payable by the
Group under residual value guarantees.
Right-of-use assets are measured at cost
comprising the following:
•
the amount of the initial measurement of
lease liability
•
any lease payments made at or before
the commencement date less any lease
incentives received
•
any initial direct costs, and
•
restoration costs.
Judgements made in calculating the lease
liability include assessing whether
arrangements contain a lease and determining
the lease term. Lease terms are negotiated
on an individual basis and contain a wide
range of different terms and conditions.
Property leases will often include an early
termination or extension option to the lease
term. Fleet management policies vary by
jurisdiction and may include renewal of a
lease until a measurement threshold, such as
mileage, is reached. Extension and termination
options have been considered when
determining the lease term, along with all
facts and circumstances that may create an
economic incentive to exercise an extension
option, or not exercise a termination option.
Extension periods (or periods after
termination options) are only included in the
lease term if the lease is reasonably certain
to be extended (or not terminated).
The lease payments are discounted using
incremental borrowing rates, as in the
majority of leases held by the Group the
interest rate implicit in the lease is not readily
identifiable. Calculating the discount rate is
an estimate made in calculating the lease
liability. This rate is the rate that the Group
would have to pay to borrow the funds
necessary to obtain an asset of similar value
to the right-of-use asset in a similar economic
environment with similar terms, security and
conditions. To determine the incremental
borrowing rate, the Group uses a risk-free
interest rate adjusted for credit risk, adjusting
for terms specific to the lease including term,
country and currency.
The Group is exposed to potential future
increases in variable lease payments that
are based on an index or rate, which are
initially measured as at the commencement
date, with any future changes in the index
or rate excluded from the lease liability until
they take effect. When adjustments to lease
payments based on an index or rate take
effect, the lease liability is reassessed and
adjusted against the right-of-use asset.
principal and finance cost. The finance cost
is charged to the Consolidated Statement
of Comprehensive Income over the lease
period so as to produce a constant periodic
rate of interest on the remaining balance of
Payments associated with short-term leases
of Property, plant and equipment and all
leases of low-value assets are recognised
on a straight-line basis as an expense in the
Consolidated Statement of Comprehensive
Income. Short-term leases are leases with
a lease term of 12 months or less. Low-value
leases are those where the underlying asset
value, when new, is $5,000 or less and
includes IT equipment and small items of
office furniture.
Contracts may contain both lease and
non-lease components. The Group allocates
the consideration in the contract to the lease
and non-lease components based on their
relative standalone prices.
Right-of-use assets are generally depreciated
over the shorter of the asset’s useful life and
the lease term on a straight-line basis. If the
Group is reasonably certain to exercise a
purchase option, the right-of-use asset is
depreciated over the underlying asset’s
useful life. It is impractical to calculate average
asset lives exactly. However, the total lives
range from approximately 10 to 50 years for
buildings, and three to 15 years for motor
vehicles and other assets.
There are no material lease agreements
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Group Accounting Policies
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Annual Report & Form 20-F Information 2024
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In assessing whether an acquired set of
assets and activities is a business or an asset,
management will first elect whether to apply
an optional concentration test to simplify the
assessment. Where the concentration test is
applied, the acquisition will be treated as the
acquisition of an asset if substantially all of
the fair value of the gross assets acquired
(excluding cash and cash equivalents,
deferred tax assets, and related goodwill)
is concentrated in a single asset or group
of similar identifiable assets.
Where the concentration test is not applied,
or is not met, a further assessment of
whether the acquired set of assets and
activities is a business will be performed.
KJ
The determination of whether an
acquired set of assets and activities is a
business or an asset can be judgemental,
particularly if the target is not producing
outputs. Management uses a number of
factors to make this determination, which are
primarily focused on whether the acquired
set of assets and activities include
substantive processes that mean the set is
capable of being managed for the purpose
of providing a return. Key determining
factors include the stage of development
of any assets acquired, the readiness and
ability of the acquired set to produce outputs
and the presence of key experienced
employees capable of conducting activities
required to develop or manufacture the
assets. Typically, the specialised nature
of many pharmaceutical assets and
processes is such that until assets are
substantively ready for production and
promotion, there are not the required
processes for a set of assets and activities
to meet the definition of a business in
IFRS 3 ‘Business Combinations’.
On the acquisition of a business, fair values
are attributed to the identifiable assets and
liabilities. Attributing fair values is a judgement.
Contingent liabilities are also recorded at
fair value unless the fair value cannot be
measured reliably, in which case the value
is subsumed into goodwill. Where fair values
of acquired contingent liabilities cannot be
measured reliably, the assumed contingent
liability is not recognised but is disclosed in the
same manner as other contingent liabilities.
Where not all of the equity of a subsidiary
is acquired, the non-controlling interest is
recognised either at fair value or at the
non-controlling interest’s proportionate
share of the net assets of the subsidiary,
on a case-by-case basis. Put options over
non-controlling interests are recognised
as a financial liability, with a corresponding
entry in either Retained earnings or against
non-controlling interest reserves on a
case-by-case basis.
The timing and amount of future contingent
elements of consideration is an estimate.
Contingent consideration, which may include
development and launch milestones, revenue
threshold milestones and revenue-based
royalties, is fair valued at the date of
acquisition using decision-tree analysis with
key inputs including probability of success,
consideration of potential delays and revenue
projections based on the Group’s internal
forecasts. Unsettled amounts of consideration
are held at fair value within payables with
changes in fair value recognised immediately
in profit.
Goodwill is the difference between the fair
value of the consideration and the fair value
of net assets acquired.
Goodwill arising on acquisitions is capitalised
and subject to an impairment review, both
annually and when there is an indication that
the carrying value may not be recoverable.
The Group’s policy up to and including
1997 was to eliminate Goodwill arising upon
acquisitions against reserves. Under IFRS 1
‘First-time Adoption of International Financial
Reporting Standards’ and IFRS 3 ‘Business
Combinations’, such Goodwill will remain
A subsidiary is an entity controlled, directly
or indirectly, by AstraZeneca PLC
regarded as the exposure or rights to the
variable returns of the entity when combined
with the power to affect those returns. Control
is normally evidenced by holding more than
50% of the share capital of the company,
however other agreements may be in
place that result in control where they give
AstraZeneca finance decision-making
authority over the relevant activities of
the company.
The financial results of subsidiaries are
consolidated from the date control is
Inventories are stated at the lower of cost
and net realisable value. The first in, first out
or an average method of valuation is used.
For finished goods and work in progress,
cost includes directly attributable costs
and certain overhead expenses (including
depreciation). Selling expenses and certain
other overhead expenses (principally central
administration costs) are excluded. Net
realisable value is determined as estimated
selling price less all estimated costs of
completion and costs to be incurred in
selling and distribution.
Write-downs of inventory occur in the general
course of business and are recognised in
Cost of sales for launched or approved
products and in Research and development
Non-current assets are classified as Assets
held for sale when their carrying amount
is to be recovered principally through a
sale transaction and a sale is considered
highly probable. A sale is considered highly
probable only when the appropriate level of
management has committed to the sale.
Assets held for sale are stated at the lower
of carrying amount and fair value less costs
to sell. Where there is a partial transfer of
a non-current asset to held for sale, an
allocation of value is made between the
current and non-current portions of the
asset based on the relative value of the two
portions, unless there is a methodology that
better reflects the asset to be disposed of.
Assets held for sale are neither depreciated
Financial assets included in Trade and other
receivables are recognised initially at fair
value. The Group holds the Trade receivables
with the objective to collect the contractual
cash flows and therefore measures them
subsequently at amortised cost using the
effective interest method, less any impairment,
based on expected credit losses.
Trade receivables that are subject to debt
factoring arrangements are derecognised if
they meet the conditions for derecognition
Financial liabilities included in Trade and
other payables are recognised initially at
fair value. Subsequent to initial recognition
they are measured at amortised cost using
the effective interest method. Contingent
consideration payables are held at fair value
within Level 3 of the fair value hierarchy as
The Group’s financial instruments include
Lease liabilities, Trade and other receivables
and payables, liabilities for contingent
consideration and put options under business
combinations, and rights and obligations
under employee benefit plans which are
dealt with in specific accounting policies.
The Group’s other financial
instruments include:
•
Cash and cash equivalents
•
Fixed deposits
•
Other investments
•
Bank and other borrowings
•
Financial Statements
Group Accounting Policies
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
158
Cash and cash equivalents comprise cash in
hand, current balances with banks and similar
institutions, and highly liquid investments
with maturities of three months or less when
acquired. They are readily convertible into
known amounts of cash and are held at
amortised cost under the hold to collect
classification, where they meet the hold to
collect ‘solely payments of principal and
interest’ test criteria under IFRS 9 ‘Financial
Instruments’. Those not meeting these
criteria are held at fair value through profit
or loss. Cash and cash equivalents in the
Consolidated Statement of Cash Flows include
unsecured bank overdrafts at the balance
sheet date where balances often fluctuate
Fixed deposits, principally comprising
funds held with banks and other financial
institutions, are initially measured at fair
value, plus direct transaction costs, and are
subsequently measured at amortised cost
using the effective interest method at each
reporting date. Changes in carrying value are
recognised in the Consolidated Statement
Investments are classified as fair value
through profit or loss (FVPL), unless the
Group makes an irrevocable election at
initial recognition for certain non-current
equity investments to present changes in
Other comprehensive income (FVOCI). If this
election is made, there is no subsequent
reclassification of fair value gains and losses
to profit and loss following the derecognition
The Group uses derivatives, principally
interest rate swaps, to hedge the interest
rate exposure inherent in a portion of its
fixed interest rate debt. In such cases the
Group will either designate the debt as
FVPL when certain criteria are met or as the
hedged item under a fair value hedge.
If the debt instrument is designated as FVPL,
the debt is initially measured at fair value
(with direct transaction costs being included
in profit and loss as an expense) and is
remeasured to fair value at each reporting
date with changes in carrying value being
recognised in profit and loss (along with
changes in the fair value of the related
derivative), with the exception of changes in
the fair value of the debt instrument relating
to own credit risk which are recorded in
Other comprehensive income in accordance
with IFRS 9 ‘Financial Instruments’. Such
a designation has been made where this
significantly reduces an accounting mismatch
which would result from recognising gains
and losses on different bases.
If the debt is designated as the hedged
item under a fair value hedge, the debt is
initially measured at fair value (with direct
transaction costs being amortised over the
life of the debt) and is remeasured for fair
value changes in respect of the hedged
risk at each reporting date with changes in
carrying value being recognised in profit
and loss (along with changes in the fair
value of the related derivative).
If the debt is designated in a cash flow
hedge, the debt is measured at amortised
cost (with gains or losses taken to profit
and loss and direct transaction costs being
amortised over the life of the debt). The
related derivative is remeasured for fair
value changes at each reporting date with the
portion of the gain or loss on the derivative
that is determined to be an effective hedge
recognised in Other comprehensive income.
The amounts that have been recognised in
Other comprehensive income are reclassified
to profit and loss in the same period that the
hedged forecast cash flows affect profit.
The reclassification adjustment is included
in Finance expense in the Consolidated
Statement of Comprehensive Income.
Other interest-bearing loans are initially
measured at fair value (with direct transaction
costs being amortised over the life of the loan)
and are subsequently measured at amortised
cost using the effective interest method at
each reporting date. Changes in carrying
value are recognised in the Consolidated
Derivatives are initially measured at fair
value (with direct transaction costs being
included in profit and loss as an expense)
and are subsequently remeasured to fair
value at each reporting date. Changes in
carrying value of derivatives not designated
in hedging relationships are recognised in
profit and loss.
The Group has agreements with some bank
counterparties whereby the parties agree
to post cash collateral, for the benefit of
the other, equivalent to the market valuation
of all of the derivative positions above a
predetermined threshold. Cash collateral
received from counterparties is included
within current Interest-bearing loans and
borrowings within the Consolidated Statement
of Financial Position. Cash collateral
pledged to counterparties is recognised as
a financial asset and is included in current
Other investments within the Consolidated
Statement of Financial Position. Cash
collateral received is included in Movement
in short-term borrowings within financing
activities in the Consolidated Statement of
Cash Flows. Cash collateral paid is included
in Movements in short-term investments
within investing activities in the Consolidated
Statement of Cash Flows. The cash flow
presentation of cash paid and received
follows the Consolidated Statement of
Financial Position presentation of the
financial asset and financial liability that
Foreign currency transactions, being
transactions denominated in a currency
other than an individual Group entity’s
functional currency, are translated into the
relevant functional currencies of individual
Group entities at average rates for the
relevant monthly accounting periods,
which approximate to actual rates.
Monetary assets and liabilities arising
from foreign currency transactions are
retranslated at exchange rates prevailing
at the reporting date. Exchange gains and
losses on loans and on short-term foreign
currency borrowings and deposits are
included within Finance expense. Exchange
differences on all other foreign currency
transactions are recognised in Operating
profit in the individual Group entity’s
accounting records.
Non-monetary items arising from foreign
currency transactions are not retranslated
in the individual Group entity’s
accounting records.
In the Consolidated Financial Statements,
income and expense items for Group entities
with a functional currency other than US
dollars are translated into US dollars at
average exchange rates, which approximate
to actual rates, for the relevant accounting
periods. Assets and liabilities are translated
at the US dollar exchange rates prevailing at
the reporting date. Exchange differences
arising on consolidation are recognised in
Other comprehensive income.
If certain criteria are met, non-US dollar-
denominated loans or derivatives are
designated as net investment hedges of
foreign operations. Exchange differences
arising on retranslation of net investments,
and of foreign currency loans which are
designated in an effective net investment
hedge relationship, are recognised in Other
comprehensive income in the Consolidated
Financial Statements. Foreign exchange
derivatives hedging net investments in
foreign operations are carried at fair value.
Effective fair value movements are recognised
in Other comprehensive income, with any
ineffectiveness taken to profit. Gains and
losses accumulated in the translation reserve
will be recycled to profit and loss when the
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Group Accounting Policies
AstraZeneca
Annual Report & Form 20-F Information 2024
159
Provisions are recognised when there
is either a legal or constructive present
obligation as a result of a past event, it is
probable that an outflow of economic
resources will be required to settle the
obligation and a reliable estimate can be
made of the amount of the obligation. If the
effect of the time value of money is material,
provisions are discounted at the relevant
pre-tax discount rate. Where provisions
are discounted, the increase in the
provision resulting from the passage of
Litigation and environmental liabilities
AstraZeneca is involved in legal disputes, the
settlement of which may involve cost to the
Group. A provision is made where an adverse
outcome is probable and associated costs,
including related legal costs, can be estimated
reliably. Determining the timing of recognition
of when an adverse outcome is probable is
considered a Key Judgement, refer to Note 30
to the Financial Statements on page 205.
Where it is considered that the Group is
more likely than not to prevail, or in the
extremely rare circumstances where the
amount of the legal liability cannot be
estimated reliably, legal costs involved in
defending the claim are charged to the
Consolidated Statement of Comprehensive
Income as they are incurred.
Where it is considered that the Group has
a valid contract which provides the right to
reimbursement (from insurance or otherwise)
of legal costs and/or all or part of any loss
incurred or for which a provision has been
established, the amount expected to be
received is recognised as an asset only
when it is virtually certain.
AstraZeneca is exposed to environmental
liabilities relating to its past operations,
principally in respect of soil and groundwater
remediation costs. Provisions for these costs
are made when there is a present obligation
and where it is probable that expenditure on
remedial work will be required and a reliable
estimate can be made of the cost.
Restructuring
Restructuring costs are incurred in
programmes that are planned and controlled
by the Group which materially change either
the scope of a business undertaken by the
Group, or the manner in which that business
is conducted.
A provision for restructuring costs is
recognised when a detailed formal plan
is in place and has either been announced
to those affected or has started to be
implemented. The general recognition
criteria for provisions must also be met,
as described in the Provisions policy.
The carrying values of non-financial assets,
other than Inventories and Deferred tax assets,
are reviewed at least annually to determine
whether there is any indication of impairment.
For Goodwill, Intangible assets under
development and for any other assets where
such indication exists, the asset’s recoverable
amount is estimated based on the greater of
its value in use and its fair value less cost to
sell. In assessing the recoverable amount,
the estimated future cash flows, adjusted
for the risks associated with the probability
of success specific to each asset, as well as
inflationary impacts, are discounted to their
present value using a nominal discount rate
that reflects current market assessments
of the time value of money, the general
risks affecting the pharmaceutical industry
and other risks specific to each asset. For
the purpose of impairment testing, assets
are grouped together into the smallest
group of assets that generates cash
inflows from continuing use that are largely
independent of the cash flows of other
assets. Impairment losses are recognised
immediately in the Consolidated Statement
Applicable accounting standards
and interpretations issued but not
yet adopted
At the date of authorisation of these Financial
Statements, certain new accounting standards
and amendments were in issue relating to
the following standards and interpretations
but not yet adopted by the Group:
•
IFRS 18 ‘Presentation and Disclosure in
Financial Statements’ is effective for
accounting periods beginning on or after
1 January 2027 and will replace IAS 1
‘Presentation of Financial Statements’.
IFRS 18 sets out new presentation
requirements for the Statement of
Comprehensive Income, as well as more
stringent and additional requirements
on the aggregation, disaggregation and
categorisation of income and expenses
within the Statement of Comprehensive
Income. Additionally, alternative
performance measures included within the
Annual Report which meet the definition
of Management-defined Performance
Measures are required to be disclosed
within the Notes to the Financial Statements.
•
The Group is currently assessing the
impact of IFRS 18. It is expected that
IFRS 18 will have a significant impact
on the presentation of the Consolidated
Statement of Comprehensive Income,
and may require judgements around
aggregation and disaggregation of certain
balances, as well as requiring additional
disclosures relating to Management-defined
Performance Measures, aggregation and
disaggregation, and EPS. IFRS 18 is yet to
be endorsed by the UKEB and the Group
is not seeking to early adopt the standard.
In addition, the following amendment was
issued but not yet adopted:
•
amendments to IAS 21 ‘The Effects of
Changes in Foreign Exchange Rates’,
effective for periods beginning on or
after 1 January 2025 – endorsed by the
Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
160
Notes to the Group Financial Statements
Product Sales | |||||||||||||||
| 2024 | 2023 | 2022 | |||||||||||||
Emerging | Rest of | Emerging | Rest of | Emerging | Rest of | ||||||||||
US | Markets | Europe | World | Total | US | Markets | Europe | World | Total | US | Markets | Europe | World | Total | |
$m | $m | $m | $m | $m | $m | $m | $m | $m | $m | $m | $m | $m | $m | $m | |
Oncology: | |||||||||||||||
Tagrisso | 2,763 | 1,755 | 1,301 | 761 | 6,580 | 2,276 | 1,621 | 1,120 | 782 | 5,799 | 2,007 | 1,567 | 1,023 | 847 | 5,444 |
Imfinzi | 2,603 | 479 | 948 | 687 | 4,717 | 2,171 | 355 | 742 | 751 | 4,019 | 1,539 | 287 | 544 | 401 | 2,771 |
Calquence | 2,190 | 153 | 656 | 130 | 3,129 | 1,815 | 98 | 493 | 108 | 2,514 | 1,657 | 45 | 286 | 69 | 2,057 |
Lynparza | 1,332 | 655 | 832 | 253 | 3,072 | 1,254 | 542 | 734 | 281 | 2,811 | 1,226 | 488 | 655 | 269 | 2,638 |
Enhertu | – | 350 | 126 | 69 | 545 | – | 169 | 60 | 32 | 261 | – | 51 | 21 | 7 | 79 |
Zoladex | 16 | 795 | 148 | 99 | 1,058 | 14 | 687 | 133 | 118 | 952 | 15 | 657 | 133 | 122 | 927 |
Imjudo | 180 | 16 | 36 | 49 | 281 | 146 | 5 | 16 | 51 | 218 | 13 | – | – | – | 13 |
Truqap | 408 | 2 | 12 | 8 | 430 | 6 | – | – | – | 6 | – | – | – | – | – |
Orpathys | – | 44 | – | – | 44 | – | 44 | – | – | 44 | – | 33 | – | – | 33 |
Others | 18 | 253 | 23 | 125 | 419 | 37 | 307 | 34 | 143 | 521 | 27 | 409 | 64 | 169 | 669 |
9,510 | 4,502 | 4,082 | 2,181 | 20,275 | 7,719 | 3,828 | 3,332 | 2,266 | 17,145 | 6,484 | 3,537 | 2,726 | 1,884 | 14,631 | |
Cardiovascular, Renal & Metabolism: | |||||||||||||||
Farxiga | 1,750 | 2,853 | 2,634 | 419 | 7,656 | 1,451 | 2,211 | 1,881 | 420 | 5,963 | 1,071 | 1,665 | 1,297 | 348 | 4,381 |
Brilinta | 751 | 294 | 268 | 20 | 1,333 | 744 | 285 | 271 | 24 | 1,324 | 744 | 286 | 282 | 46 | 1,358 |
Crestor | 46 | 934 | 37 | 136 | 1,153 | 55 | 862 | 52 | 138 | 1,107 | 65 | 794 | 41 | 148 | 1,048 |
Seloken / Toprol-XL | – | 589 | 13 | 3 | 605 | 1 | 621 | 11 | 7 | 640 | – | 839 | 14 | 9 | 862 |
Lokelma | 256 | 86 | 92 | 108 | 542 | 214 | 50 | 58 | 90 | 412 | 170 | 20 | 30 | 69 | 289 |
Roxadustat | – | 331 | – | – | 331 | – | 271 | – | – | 271 | – | 197 | – | – | 197 |
Andexxa | 81 | 3 | 80 | 55 | 219 | 75 | – | 62 | 45 | 182 | 77 | – | 41 | 32 | 150 |
Wainua | 85 | – | – | – | 85 | – | – | – | – | – | – | – | – | – | – |
Others | 106 | 249 | 146 | 23 | 524 | 212 | 286 | 168 | 20 | 686 | 352 | 318 | 201 | 32 | 903 |
3,075 | 5,339 | 3,270 | 764 | 12,448 | 2,752 | 4,586 | 2,503 | 744 | 10,585 | 2,479 | 4,119 | 1,906 | 684 | 9,188 | |
Respiratory & Immunology: | |||||||||||||||
Symbicort | 1,187 | 805 | 559 | 328 | 2,879 | 726 | 753 | 549 | 334 | 2,362 | 973 | 608 | 582 | 375 | 2,538 |
Fasenra | 1,049 | 92 | 404 | 144 | 1,689 | 992 | 64 | 355 | 142 | 1,553 | 906 | 43 | 305 | 142 | 1,396 |
Pulmicort | 6 | 568 | 71 | 37 | 682 | 28 | 575 | 68 | 42 | 713 | 65 | 462 | 69 | 49 | 645 |
Breztri | 516 | 245 | 143 | 74 | 978 | 383 | 161 | 81 | 52 | 677 | 239 | 92 | 33 | 34 | 398 |
Tezspire | – | 11 | 156 | 81 | 248 | – | 1 | 48 | 37 | 86 | – | – | 2 | 2 | 4 |
Saphnelo | 425 | 7 | 26 | 16 | 474 | 260 | 2 | 8 | 10 | 280 | 111 | – | 2 | 3 | 116 |
Airsupra | 66 | – | – | – | 66 | 2 | – | – | – | 2 | – | – | – | – | – |
Others | 167 | 169 | 57 | 7 | 400 | 156 | 215 | 55 | 8 | 434 | 361 | 238 | 61 | 8 | 668 |
3,416 | 1,897 | 1,416 | 687 | 7,416 | 2,547 | 1,771 | 1,164 | 625 | 6,107 | 2,655 | 1,443 | 1,054 | 613 | 5,765 | |
Vaccines & Immune Therapies: | |||||||||||||||
Synagis | (8) | 210 | 116 | 129 | 447 | (1) | 195 | 175 | 177 | 546 | 1 | 173 | 213 | 191 | 578 |
Beyfortus | 232 | – | 84 | 2 | 318 | 87 | – | 19 | – | 106 | – | – | – | – | – |
FluMist | 28 | 1 | 204 | 25 | 258 | 23 | 1 | 188 | 4 | 216 | 21 | 1 | 151 | 2 | 175 |
COVID-19 mAbs | 28 | – | 3 | – | 31 | – | 6 | 12 | 114 | 132 | 1,067 | 413 | 298 | 407 | 2,185 |
Others | – | 2 | 2 | – | 4 | – | 10 | 2 | – | 12 | 79 | 729 | 365 | 625 | 1,798 |
280 | 213 | 409 | 156 | 1,058 | 109 | 212 | 396 | 295 | 1,012 | 1,168 | 1,316 | 1,027 | 1,225 | 4,736 | |
Rare Disease: | |||||||||||||||
Ultomiris | 2,261 | 141 | 884 | 638 | 3,924 | 1,750 | 71 | 668 | 476 | 2,965 | 1,136 | 38 | 481 | 310 | 1,965 |
Soliris | 1,523 | 443 | 416 | 206 | 2,588 | 1,734 | 424 | 670 | 317 | 3,145 | 2,180 | 301 | 805 | 476 | 3,762 |
Strensiq | 1,167 | 54 | 99 | 96 | 1,416 | 937 | 40 | 89 | 86 | 1,152 | 769 | 35 | 78 | 76 | 958 |
Koselugo | 212 | 177 | 103 | 39 | 531 | 195 | 59 | 53 | 24 | 331 | 162 | 26 | 20 | – | 208 |
Kanuma | 100 | 34 | 66 | 9 | 209 | 85 | 29 | 49 | 8 | 171 | 77 | 31 | 44 | 8 | 160 |
5,263 | 849 | 1,568 | 988 | 8,668 | 4,701 | 623 | 1,529 | 911 | 7,764 | 4,324 | 431 | 1,428 | 870 | 7,053 | |
Other: | |||||||||||||||
Nexium | 96 | 591 | 60 | 120 | 867 | 115 | 578 | 53 | 199 | 945 | 120 | 568 | 46 | 551 | 1,285 |
Others | 15 | 144 | 43 | 4 | 206 | 18 | 153 | 52 | 8 | 231 | 24 | 220 | 77 | 19 | 340 |
111 | 735 | 103 | 124 | 1,073 | 133 | 731 | 105 | 207 | 1,176 | 144 | 788 | 123 | 570 | 1,625 | |
Product Sales | 21,655 | 13,535 | 10,848 | 4,900 | 50,938 | 17,961 | 11,751 | 9,029 | 5,048 | 43,789 | 17,254 | 11,634 | 8,264 | 5,846 | 42,998 |
SE
Rebates and chargebacks in the US
The major market where estimates are seen as significant is the US. When invoicing Product Sales in the US, we estimate the rebates and
chargebacks we expect to pay and we consider there to be a significant estimate associated with the rebates for Managed Care, Medicaid
and Medicare Part D. The total adjustment in respect of prior year net US Product Sales in 2024 was 0.6% (2023: 1.0%; 2022: 1.3%); this
represents the difference between our prior year estimates for rebates and chargebacks against actual amounts paid for the US business.
The most significant of these relate to the Medicaid and state programmes with an adjustment in respect of prior year net US Product Sales
in 2024 of 0.1% (2023: 0.3%; 2022: 0.5%) and Managed Care and Medicare of 0.6% (2023: 0.5%; 2022: 0.8%).
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
161
The adjustment in respect of the prior year net US Product Sales, excluding the Rare Disease therapy area in 2024, was 0.8% (2023: 1.4%;
2022: 1.6%), with Medicaid and state programmes of 0.1% (2023: 0.4%; 2022: 0.6%) and Managed Care and Medicare of 0.7% (2023: 0.7%;
2022: 1.1%).
These values demonstrate the level of sensitivity; further meaningful sensitivity is not able to be provided due to the large volume of variables
that contribute to the overall rebates, chargebacks, returns and other revenue accruals. These variables include assumptions in respect of
aggregate future sales levels, segment mix and customers’ contractual performance, and in addition for Managed Care, US Medicaid and
Medicare Part D, the channel inventory levels, and assumptions related to lag time. These assumptions are built up on a product-by-product
and customer-by-customer basis, taking into account specific contract provisions coupled with expected performance, and are then aggregated
into a weighted average rebate accrual rate for each of our products. Accrual rates are reviewed and adjusted on an as-needed basis. There
may be further adjustments when actual rebates are invoiced based on utilisation information submitted to AstraZeneca (in the case of
contractual rebates) and claims/invoices are received (in the case of regulatory rebates and chargebacks).
Alliance Revenue
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Enhertu |
1,437 |
1,022 |
523 |
Tezspire |
436 |
259 |
79 |
Beyfortus |
237 |
57 |
– |
Vaxzevria : royalties |
– |
– |
76 |
Other royalty income |
91 |
81 |
68 |
Other Alliance Revenue |
11 |
9 |
9 |
2,212 |
1,428 |
755 |
Collaboration Revenue
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Lynparza : sales milestones |
600 |
– |
– |
Beyfortus : sales milestones |
167 |
27 |
– |
Koselugo : sales milestones |
100 |
– |
– |
Farxiga : sales milestones |
56 |
29 |
– |
Lynparza : regulatory milestones |
– |
245 |
355 |
COVID-19 mAbs: licence fees |
– |
180 |
– |
Beyfortus : regulatory milestones |
– |
71 |
25 |
tralokinumab: sales milestones |
– |
20 |
110 |
Nexium : sale of rights |
– |
– |
62 |
Other Collaboration Revenue |
– |
22 |
46 |
923 |
594 |
598 |
Operating profit includes the following significant items:
In 2024, Cost of sales includes a charge of $nil (2023: $114m; 2022: $3,484m) in relation to the release, in line with sales, of fair value uplift
In 2024, Selling, general and administrative expense includes a charge of $260m (2023: $520m; 2022: $182m) resulting from changes in
the fair value of contingent consideration arising from the acquisition of the diabetes alliance from BMS. These adjustments reflect revised
estimates for future sales performance for the products acquired and, as a result, revised estimates for future royalties payable.
In 2024, Selling, general and administrative expense also includes a charge of $48m (2023: $1,013m; 2022: $789m) relating to a number of
During the year $nil (2023: $74m; 2022: $113m) of government grants were recognised within Research and development expense. The grants
recognised relate to funding for Research and development and related expenses for COVID-19 mAbs of $nil (2023: $nil; 2022: $112m) and
Vaxzevria
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Royalty income |
103 |
107 |
59 |
Gains on disposal of intangible assets |
64 |
251 |
104 |
Net (losses)/gains on disposal of other non-current assets |
(4) |
41 |
112 |
Update to the contractual relationships for Beyfortus |
– |
712 |
– |
Other income 1 |
210 |
393 |
439 |
Other expense |
(121) |
(164) |
(200) |
Other operating income and expense |
252 |
1,340 |
514 |
1
Other income in 2024 includes $nil of income from Allergan Plc. in respect of the development of brazikumab (2023: $75m; 2022: $138m).
Financial Statements
Notes to the Group Financial Statements
continued
2 Operating profit
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
162
Gains on disposal of intangible assets in 2023 includes $241m on disposal of commercial rights to
Pulmicort
Flexhaler to Cheplapharm in the US.
Net (losses)/gains on disposal of other non-current assets in 2022 includes a $125m gain in respect of the Waltham R&D site sale and
leaseback in MA, US (see Note 8).
As part of the total consideration received in respect of the agreement to sell US rights to
Synagis
in 2019, $400m in total has been received
related to the rights to participate in the future cash flows from the US profits or losses for
Beyfortus
, with $190m cash inflows in 2023
primarily relating to a cash receipt from Sobi following achievement of a regulatory milestone. At 31 December 2022, the full amount of
$522m was recognised as a financial liability within non-current Other payables (the Profit Participation Liability) as the Group had not fully
transferred the risks and rewards of the underlying cash flows arising from
Beyfortus
to Sobi. All associated cash flows have been presented
within investing activities as the Group has received the cash in exchange for agreeing to transfer future cash flows relating to an intangible
asset. In 2023, the contractual relationship between AstraZeneca and Sobi relating to future sales of
Beyfortus
in the US was replaced by
a royalty relationship between Sanofi and Sobi. As a result, the Profit Participation Liability was extinguished and derecognised from the
Restructuring costs
In conjunction with the acquisition of Alexion in 2021, the enlarged Group initiated the Post Alexion Acquisition Group Review (PAAGR);
a global restructuring programme aimed at integrating systems, structure and processes, optimising the global footprint and prioritising
resource allocations and investments. During 2023, the Group identified all remaining activities and finalised the scope of the programme.
During 2024, the Group has undertaken a further assessment of those planned activities. This included the commencement of work on the
planned upgrade of the Group’s Enterprise Resource Planning IT systems (Axial Project), which is expected to be substantially complete by
the end of 2030. The Group has also continued to progress other legacy restructuring programmes.
During 2024, the Group has incurred $1,154m of restructuring costs, of which $1,115m resulted from activities that are part of the PAAGR,
bringing the cumulative charges under this programme to $3,182m. Costs in 2024 included $529m within Cost of sales primarily due to
inventory and related product provisions related to
Andexxa
following the decision to cease promotional activities, $312m within Selling,
general and administrative expense in relation to severance, HR, Finance, IT and other integration costs and $275m within Research and
development expense in relation to the transformation of clinical, regulatory and other R&D data and systems.
reversal of $4m), a $7m impairment charge to Right-of-use assets (2023: $13m; 2022: $nil) and no impairment of Intangible assets (2023: $nil;
The tables below show the costs that have been charged in respect of restructuring programmes by cost category and type. Severance
provisions are detailed in Note 21.
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Cost of sales |
569 |
109 |
266 |
Distribution expense |
– |
– |
2 |
Research and development expense |
275 |
212 |
111 |
Selling, general and administrative expense |
312 |
207 |
405 |
Other operating income and expense |
(2) |
(61) |
(67) |
Total charge |
1,154 |
467 |
717 |
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Severance costs |
213 |
57 |
187 |
Accelerated depreciation and impairment charges |
64 |
68 |
135 |
Other 1 |
877 |
342 |
395 |
Total charge |
1,154 |
467 |
717 |
1
Other costs are those incurred in designing and implementing the Group’s various restructuring initiatives. In 2024, Other costs included $480m for inventory and related product
provisions related to
Andexxa
following the decision to cease promotional activities. Other costs also include the costs of integrating systems, structure and processes as part of the
PAAGR, costs relating to the Alexion acquisition, internal project costs and external service fees.
Included within Operating profit are the following net gains and losses on financial instruments:
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
(Losses)/gains on forward foreign exchange contracts |
(81) |
42 |
150 |
Losses on receivables and payables |
(143) |
(260) |
(203) |
Total |
(224) |
(218) |
(53) |
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
163
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Finance income |
|||
Returns on deposits and equity securities |
339 |
291 |
78 |
Fair value gains on debt and interest rate swaps |
113 |
43 |
14 |
Interest income on income tax balances |
6 |
10 |
3 |
Total |
458 |
344 |
95 |
Finance expense |
|||
Interest on debt, leases and other financing costs |
(1,391) |
(1,132) |
(889) |
Net interest on post-employment defined benefit plan net liabilities (Note 22) |
(50) |
(38) |
(29) |
Net exchange losses |
(42) |
(34) |
(16) |
Discount unwind on contingent consideration arising from business combinations (Note 20) |
(113) |
(132) |
(168) |
Discount unwind on other long-term liabilities 1 |
(116) |
(200) |
(216) |
Fair value losses on debt and interest rate swaps |
(18) |
(3) |
– |
Interest expense on income tax balances |
(12) |
(87) |
(28) |
Total |
(1,742) |
(1,626) |
(1,346) |
Net finance expense |
(1,284) |
(1,282) |
(1,251) |
1
Included within Discount unwind on other long-term liabilities is $nil relating to the Acerta Pharma share purchase liability (2023: $55m; 2022: $108m) and the discount unwind of
other payables of $91m (2023: $100m; 2022: $nil) that have arisen from intangible asset additions, see Note 20 for further details.
There was no interest capitalised during the year.
Included within Finance income and expense are the following net gains and losses on financial instruments:
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Interest and fair value adjustments in respect of debt designated at fair value through profit or loss, net of derivatives |
107 |
13 |
(9) |
Interest and changes in carrying values of debt designated as hedged items in fair value hedges, net of derivatives |
(38) |
– |
– |
Interest and fair value changes on fixed and short-term deposits, equity securities, other derivatives and tax balances |
306 |
177 |
54 |
Interest on debt, commercial paper, overdrafts and lease liabilities held at amortised cost |
(1,251) |
(1,004) |
(837) |
The Group held derivatives that economically hedged a debt instrument designated at fair value through profit or loss. Both the derivatives
and debt instrument matured in 2023. The Interest and fair value adjustments in respect of debt designated at fair value through profit or loss,
net of derivatives, includes the following amounts related to these matured instruments; derivatives $nil (2023: loss of $1m; 2022: loss of $25m);
Taxation charge/(credit) recognised in the Consolidated Statement of Comprehensive Income is as follows:
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Current tax |
|||
Current year |
2,314 |
2,417 |
1,823 |
Pillar Two income tax charge |
238 |
– |
– |
Adjustment to prior years |
(107) |
28 |
(187) |
Total |
2,445 |
2,445 |
1,636 |
Deferred tax |
|||
Origination and reversal of temporary differences |
(818) |
(1,473) |
(2,563) |
Adjustment to prior years |
23 |
(34) |
135 |
Total |
(795) |
(1,507) |
(2,428) |
Taxation charge/(credit) recognised in the profit for the year |
1,650 |
938 |
(792) |
Taxation (charge)/credit recognised in Other comprehensive income is as follows:
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Current and deferred tax |
|||
Items that will not be reclassified to profit and loss: |
|||
Remeasurement of the defined benefit liability |
(23) |
102 |
(231) |
Equity investments measured at fair value through Other comprehensive income |
(20) |
(1) |
15 |
Total |
(43) |
101 |
(216) |
Items that may be reclassified subsequently to profit and loss: |
|||
Foreign exchange arising on designated liabilities in net investment hedges |
28 |
(24) |
73 |
Fair value movement on cash flow hedges |
(3) |
12 |
– |
Total |
25 |
(12) |
73 |
Taxation (charge)/credit recognised in Other comprehensive income |
(18) |
89 |
(143) |
Financial Statements
Notes to the Group Financial Statements
continued
4 Taxation
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
164
The reported tax rate in the year was 19%.
The income tax paid for the year was $2,750m.
Taxation has been provided at current rates on the profits earned for the years covered by the Group Financial Statements. The 2024, 2023 and
2022 prior year current tax adjustments relate mainly to tax accrual to tax return adjustments and updates to provisions for tax contingencies.
The 2024 prior year deferred tax adjustment relates mainly to tax accrual to tax return adjustments and updates to provisions for tax
contingencies. The 2023 prior year deferred tax adjustment relates mainly to tax accrual to tax return adjustments and adjustments to the
recognition of deferred tax assets. The 2022 prior year deferred tax adjustments relate mainly to tax accrual to tax return adjustments and
updates to provisions for tax contingencies.
To the extent that dividends remitted from overseas subsidiaries, joint ventures and associates are expected to result in additional taxes,
appropriate amounts have been provided for. Unremitted earnings or differences in the carrying value and tax basis of investments may be
liable to additional taxes if distributed as dividends or on a liquidation event. Deferred tax is provided for such differences in relation to Group
entities where management is intending to remit earnings in the foreseeable future. The aggregate amount of gross temporary differences
associated with investments in subsidiaries, partnerships and branches for which deferred tax liabilities have not been recognised totalled
approximately $7,586m at 31 December 2024, $3,585m of which has a corresponding deductible temporary difference of the same gross
value which is not recognised as it is not probable of reversing in the foreseeable future but on which different tax rates apply.
Factors affecting future tax charges
As a group with worldwide operations, AstraZeneca is subject to several factors that may affect future tax charges, principally the levels and
mix of profitability in different jurisdictions, transfer pricing regulations, tax rates imposed and tax regime reforms.
Tax reconciliation to UK statutory rate
The table below reconciles the UK statutory tax charge to the Group’s total tax charge/(credit):
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Profit before tax |
8,691 |
6,899 |
2,501 |
Notional taxation charge at UK corporation tax rate of 25% (2023: 23.5%; 2022: 19%) |
2,173 |
1,621 |
475 |
Differences in effective overseas tax rates 1 |
(60) |
(224) |
(59) |
Deferred tax credit relating to change in tax rates 2 |
(24) |
(66) |
(108) |
Unrecognised deferred tax asset 3 |
104 |
341 |
68 |
Items not deductible for tax purposes |
64 |
46 |
90 |
Intellectual Property incentive regimes |
(561) |
(367) |
(265) |
Pillar Two income taxes |
238 |
– |
– |
Other items 4 |
(200) |
(406) |
(941) |
Adjustments to prior periods 5 |
(84) |
(7) |
(52) |
Total tax charge/(credit) for the year |
1,650 |
938 |
(792) |
1
Includes the impact of the reversal of a $1.9bn deferred tax liability that was recognised in a previous business combination (31 December 2024: $0.5bn) and originated in goodwill.
Some of this liability reverses in an intellectual property incentive regime and gives rise to a post-acquisition benefit to the tax charge that is not material year-on-year. Determining
the cumulative post-acquisition benefit over the life of the asset involves estimates and judgements as the amount of income that qualifies for the intellectual property incentive
regime varies. The actual tax rates applied over the life of the asset are expected to be a blend between the Dutch statutory tax rate and intellectual property incentive regime rate.
2
The 2023 item relates to the impact of the difference in the UK current and deferred tax rates during 2023. The 2022 item relates to the impact of the US state tax rate change and
the impact of the difference in the UK current tax and deferred tax rates during 2022.
3
This includes the derecognition of deferred tax assets where it is no longer probable that there will be sufficient forecast future profits to utilise the assets.
4
Other items in 2024 includes a net credit following internal transfers of assets. Other items in 2023 include a favourable adjustment of $828m to deferred taxes arising from a UK
company undertaking an intragroup purchase of certain intellectual property offset by a charge of $422m mainly relating to updates to tax liabilities following progress of reviews
by tax authorities, administrative appeal processes and adjustments arising on expiry of the relevant statute of limitations (see Note 30 for more details). Other items in 2022 includes
a one-time favourable net adjustment of $876m to deferred taxes arising from an internal reorganisation to integrate the Alexion organisation which took place in 2022 and a credit
of $65m relating to the reduction of tax liabilities arising from adjustments on expiry of the relevant statute of limitations.
5
Further details explaining the adjustments in respect of prior years are set out above.
AstraZeneca is domiciled in the UK but operates in other countries where the tax rates and laws are different to those in the UK. The impact
on differences in effective overseas tax rates on the Group’s overall tax charge is noted above. Profits arising from our manufacturing operation
in Puerto Rico are granted special status and are taxed at a reduced rate compared with the normal rate of tax in that territory under a tax
incentive grant continuing until 2031. The Group receives intellectual property incentives in certain jurisdictions, resulting in a reduction to
the tax charge in the Consolidated Statement of Comprehensive Income of $561m in 2024.
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
165
The total movement in the net deferred tax balance in the year was $168m. The movements are as follows:
Intangibles, |
Elimination of |
Losses and |
|||||
Property, plant |
unrealised profit |
Untaxed |
tax credits |
Accrued |
|||
and equipment |
on inventory |
reserves 1 |
carried forward |
expenses |
Other 2 |
Total |
|
$m |
$m |
$m |
$m |
$m |
$m |
$m |
|
Net deferred tax balance at 1 January 2022 |
(5,480) |
1,861 |
(862) |
1,518 |
85 |
1,002 |
(1,876) |
Income statement 3 |
1,414 |
274 |
38 |
(126) |
778 |
50 |
2,428 |
Other comprehensive income |
72 |
– |
– |
– |
– |
(215) |
(143) |
Equity |
– |
– |
– |
– |
– |
38 |
38 |
Exchange |
63 |
(111) |
108 |
(134) |
17 |
(71) |
(128) |
Net deferred tax balance at 31 December 2022 |
(3,931) |
2,024 |
(716) |
1,258 |
880 |
804 |
319 |
Income statement 3 |
1,518 |
426 |
96 |
(308) |
(23) |
(202) |
1,507 |
Other comprehensive income |
(16) |
– |
– |
– |
– |
83 |
67 |
Equity |
– |
– |
– |
– |
– |
(21) |
(21) |
Additions and disposals |
(24) |
– |
– |
50 |
– |
(1) |
25 |
Exchange |
(38) |
(64) |
(40) |
106 |
32 |
(19) |
(23) |
Net deferred tax balance at 31 December 2023 |
(2,491) |
2,386 |
(660) |
1,106 |
889 |
644 |
1,874 |
Income statement |
803 |
238 |
(186) |
36 |
74 |
(170) |
795 |
Other comprehensive income |
34 |
– |
– |
– |
– |
(42) |
(8) |
Equity |
– |
– |
– |
– |
– |
(28) |
(28) |
Additions and disposals |
(605) |
– |
– |
127 |
2 |
(1) |
(477) |
Exchange |
93 |
(152) |
68 |
(70) |
(40) |
(13) |
(114) |
Net deferred tax balance at 31 December 2024⁴ |
(2,166) 5 |
2,472 |
(778) |
1,199 |
925 |
390 |
2,042 |
1
Untaxed reserves relate to taxable profits where the tax liability is deferred to later periods.
2
The Group revised its presentation of deferred taxes on pension and post-retirement benefits in 2024 to present this within Other.
3
The Income statement movement in 2023 includes $828m arising from a UK company undertaking an intragroup purchase of certain intellectual property. The Income statement
movement in 2022 includes the aforementioned net adjustment to deferred taxes of $876m arising on the internal legal entity reorganisation to integrate the Alexion organisation,
the majority of which arises on Intangibles, Property, plant and equipment.
4
The Group recognises deferred tax assets to the extent that there are either taxable temporary differences or that it is probable that sufficient future taxable profits will arise, against
which these deductible temporary differences can be utilised. The US includes a net deferred tax asset of $122m and the UK includes a net deferred tax asset of $1,597m as at
31 December 2024 which includes tax losses and other deductible temporary differences. The Group has performed an assessment of recovery of deferred tax assets and for these
respective entities, the Group has forecasted future taxable profits and considers that it is probable that sufficient future taxable profits will arise against which these deductible
temporary differences can be utilised. In arriving at these forecasts, the Group has reviewed the Group-level budgets and forecasts and the ability of those entities to generate future
income from developing and commercialising products, including local tax laws and the scheduling of reversal of deductible temporary differences. Deferred tax assets are recognised
on the basis there is sufficient forecast future taxable profits arising from the performance of on-market products and pipeline assets, including
Imfinzi
. For the UK, losses are forecast
to be utilised within five years. For the US, recognised deferred taxes on losses and other items are forecast to be utilised within 10 years. It is considered that these sources of income
are sufficiently predictable or diversified to support these recognition periods. A sensitivity assessment has been performed which shows that a change in profit of 10% results in an
immaterial adjustment to the amount of deferred tax asset recognised. Assessing the availability of future taxable income to support recognition of deferred tax assets relies upon our
Group forecasts and changes in these Group forecasts will impact the recoverability of deferred tax assets. To the extent that there are neither taxable temporary differences nor
sufficient taxable profits, no deferred tax asset is recognised and details of unrecognised deferred tax assets are included in the table below.
5
Includes deferred tax assets of $384m on liabilities in respect of intangibles and $221m on lease liabilities in respect of right-of-use assets.
The net deferred tax balance, before the offset of balances within countries, consists of:
Intangibles, |
Elimination of |
Losses and |
|||||
Property, plant |
unrealised profit |
Untaxed |
tax credits |
Accrued |
|||
and equipment |
on inventory |
reserves |
carried forward |
expenses |
Other 1 |
Total |
|
$m |
$m |
$m |
$m |
$m |
$m |
$m |
|
Deferred tax assets at 31 December 2022 |
1,499 |
2,048 |
– |
1,274 |
1,005 |
885 |
6,711 |
Deferred tax liabilities at 31 December 2022 |
(5,430) |
(24) |
(716) |
(16) |
(125) |
(81) |
(6,392) |
Net deferred tax balance at 31 December 2022 |
(3,931) |
2,024 |
(716) |
1,258 |
880 |
804 |
319 |
Deferred tax assets at 31 December 2023 |
1,883 |
2,386 |
– |
1,141 |
1,011 |
801 |
7,222 |
Deferred tax liabilities at 31 December 2023 |
(4,374) |
– |
(660) |
(35) |
(122) |
(157) |
(5,348) |
Net deferred tax balance at 31 December 2023 |
(2,491) |
2,386 |
(660) |
1,106 |
889 |
644 |
1,874 |
Deferred tax assets at 31 December 2024 |
1,781 |
2,472 |
– |
1,221 |
1,039 |
688 |
7,201 |
Deferred tax liabilities at 31 December 2024 |
(3,947) |
– |
(778) |
(22) |
(114) |
(298) |
(5,159) |
Net deferred tax balance at 31 December 2024 |
(2,166) |
2,472 |
(778) |
1,199 |
925 |
390 |
2,042 |
1
The Group revised its presentation of deferred taxes on pension and post-retirement benefits in 2024 to present this within Other.
Analysed in the Consolidated Statement of Financial Position, after offset of balances within countries, as follows:
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Deferred tax assets |
5,347 |
4,718 |
3,263 |
Deferred tax liabilities |
(3,305) |
(2,844) |
(2,944) |
Net deferred tax balance |
2,042 |
1,874 |
319 |
Financial Statements
Notes to the Group Financial Statements
continued
4 Taxation
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
166
Unrecognised deferred tax assets
Deferred tax assets (DTA) of $1,523m (2023: $1,251m; 2022: $807m
) have not been recognised in respect of deductible temporary differences
because it is not probable that future taxable profit will be available against which the Group can utilise the benefits therefrom.
2024 |
2024 |
2023 |
2023 |
2022 |
2022 |
|
Temporary |
Unrecognised |
Temporary |
Unrecognised |
Temporary |
Unrecognised |
|
differences |
DTA |
differences |
DTA |
differences |
DTA |
|
$m |
$m |
$m |
$m |
$m |
$m |
|
Temporary differences expiring: |
||||||
Within 10 years |
161 |
37 |
87 |
22 |
104 |
26 |
More than 10 years |
217 |
46 |
153 |
32 |
153 |
32 |
Indefinite |
3,883 |
816 |
2,788 |
595 |
686 |
163 |
4,261 |
899 |
3,028 |
649 |
943 |
221 |
|
Tax credits and State tax losses expiring: |
||||||
Within 10 years |
162 |
152 |
115 |
|||
More than 10 years |
373 |
363 |
384 |
|||
Indefinite |
89 |
87 |
87 |
|||
624 |
602 |
586 |
||||
Total |
1,523 |
1,251 |
807 |
2024 |
2023 |
2022 |
|
Profit for the year attributable to equity holders ($m) |
7,035 |
5,955 |
3,288 |
Basic earnings per Ordinary Share |
$4.54 |
$3.84 |
$2.12 |
Diluted earnings per Ordinary Share |
$4.50 |
$3.81 |
$2.11 |
Weighted average number of Ordinary Shares in issue for basic earnings (millions) |
1,550 |
1,549 |
1,548 |
Dilutive impact of share options outstanding (millions) |
13 |
13 |
12 |
Diluted weighted average number of Ordinary Shares in issue (millions) |
1,563 |
1,562 |
1,560 |
The earnings figures used in the calculations above are post-tax. The weighted average number of Ordinary Shares in issue is calculated by
The Group has reviewed its assessment of reportable segments under IFRS 8 ‘Operating Segments’ and concluded that the Group continues
to have one reportable segment.
KJ
This determination is considered to be a Key Judgement and this judgement has been taken with reference to the following factors:
1 The level of integration across the different functions of the Group’s pharmaceutical business:
AstraZeneca is engaged in a single business activity of pharmaceuticals and the Group does not have multiple operating segments.
functional areas are not managed separately.
2 The identification of the Chief Operating Decision Maker (CODM) and the nature and extent of the financial information reviewed
by the CODM:
The SET, established and chaired by the CEO, is the vehicle through which the CEO exercises the authority delegated to him from the Board
for the management, development and performance of AstraZeneca as a whole. It is considered that the SET is AstraZeneca’s Chief Operating
Decision Making body (as defined by IFRS 8). The operation of the SET is principally driven by the management of the Commercial operations,
R&D, manufacturing and supply and enabling functions. All significant operating decisions are undertaken by the SET. While members of
the SET have responsibility for implementation of decisions in their respective areas, operating decision making is at SET level as a whole.
Where necessary, these are implemented through cross-functional sub-committees that consider the Group-wide impact of a new decision.
For example, product launch decisions would be initially considered by the SET and, on approval, passed to an appropriate sub team for
implementation. The ability of the enterprise to develop, produce, deliver and commercialise a wide range of pharmaceutical products are
central to the SET decision-making process.
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
167
In assessing performance, the SET reviews financial information on an integrated basis for the Group as a whole, substantially in the form of,
and on the same basis as, the Group’s IFRS Financial Statements. The high upfront cost of discovering and developing new products, coupled
with the relatively insignificant and stable unit cost of production, means that there is not the clear link that exists in many manufacturing
businesses between the revenue generated on an individual product sale and the associated cost and hence margin generated on a product.
Consequently, the profitability of individual drugs or classes of drugs is not considered a key measure of performance for the business and
is not monitored by the SET. The focus of additional financial information reviewed is at brand sales and Gross Margin level within specific
geographies. Expenditure analysis is completed for the science units, operations and enabling functions; there is no allocation of these
centrally-managed Group costs to the individual product or brands. The bonus of SET members’ continues to be derived from the Group
scorecard outcome as discussed in our Directors’ Remuneration Report.
3 How resources are allocated:
Resources are allocated on a Group-wide basis according to need. In particular, capital expenditure, in-licensing, and R&D resources are
allocated between activities on merit, based on overall therapeutic considerations and strategy under the aegis of the Group’s Early-Stage
Product Committees and Late-Stage Product Committees.
The following table shows information for Total Revenue by geographic area and material countries. Product Sales by geographic area are
included in the country/region where the legal entity resides and from which those sales were made. The additional tables show the Operating
profit and Profit before tax made by companies located in that area, together with Non-current assets, Total assets, Assets acquired, Net
operating assets, and Property, plant and equipment owned by the same companies.
Total Revenue |
|||
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
UK |
4,740 |
3,368 |
3,117 |
Rest of Europe |
|||
France |
1,283 |
1,152 |
1,107 |
Germany |
2,524 |
2,099 |
1,902 |
Italy |
949 |
813 |
735 |
Spain |
994 |
847 |
738 |
Sweden |
2,290 |
1,704 |
1,721 |
Others |
3,663 |
3,110 |
2,706 |
11,703 |
9,725 |
8,909 |
|
The Americas |
|||
Canada |
937 |
967 |
1,166 |
US |
21,806 |
18,121 |
17,278 |
Others |
2,246 |
1,683 |
1,175 |
24,989 |
20,771 |
19,619 |
|
Asia, Africa & Australasia |
|||
Australia |
439 |
390 |
571 |
China |
6,419 |
5,872 |
5,743 |
Japan |
3,452 |
3,640 |
3,986 |
Others |
2,331 |
2,045 |
2,406 |
12,641 |
11,947 |
12,706 |
|
Total Revenue |
54,073 |
45,811 |
44,351 |
Total Revenue outside of the UK totalled $49,333m for the year ended 31 December 2024 (2023: $42,443m; 2022: $41,234m).
| Operating profit/(loss) |
Profit/(loss) before tax |
|||||
2024 |
2023 |
2022 |
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
$m |
$m |
$m |
|
UK |
2,680 |
665 |
1,120 |
1,349 |
(577) |
272 |
Rest of Europe |
5,924 |
4,885 |
2,945 |
6,057 |
4,999 |
2,709 |
The Americas |
423 |
1,495 |
(954) |
318 |
1,328 |
(1,140) |
Asia, Africa & Australasia |
976 |
1,148 |
646 |
967 |
1,149 |
660 |
Continuing operations |
10,003 |
8,193 |
3,757 |
8,691 |
6,899 |
2,501 |
Financial Statements
Notes to the Group Financial Statements
continued
6 Segment information
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
168
| Non-current assets 1,2 |
Total assets |
|||||
2024 |
2023 |
2022 |
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
$m |
$m |
$m |
|
UK |
8,699 |
8,626 |
8,208 |
20,139 |
19,616 |
16,786 |
Rest of Europe |
30,654 |
32,905 |
34,301 |
37,884 |
40,638 |
40,669 |
The Americas |
28,730 |
26,524 |
25,425 |
38,544 |
34,754 |
32,990 |
Asia, Africa & Australasia |
2,181 |
910 |
929 |
7,468 |
6,111 |
6,038 |
Continuing operations |
70,264 |
68,965 |
68,863 |
104,035 |
101,119 |
96,483 |
| Assets acquired 3 |
Net operating assets 4 |
|||||
2024 |
2023 |
2022 |
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
$m |
$m |
$m |
|
UK |
582 |
812 |
2,301 |
7,173 |
5,275 |
3,863 |
Rest of Europe |
2,225 |
1,770 |
522 |
30,852 |
32,920 |
32,726 |
The Americas |
3,925 |
1,925 |
421 |
24,501 |
22,746 |
23,290 |
Asia, Africa & Australasia |
1,394 |
117 |
51 |
2,602 |
1,405 |
1,895 |
Continuing operations |
8,126 |
4,624 |
3,295 |
65,128 |
62,346 |
61,774 |
1
Non-current assets exclude Deferred tax assets and Derivative financial instruments.
2
In 2023, the Group revised the presentation of Non-current assets to exclude certain financial assets and post-employment benefit assets which previously had been included in this
disclosure. This resulted in a decrease in 2022 of $1,690m.
3
Included in Assets acquired are those assets that are expected to be used during more than one period (Property, plant and equipment, Goodwill and Intangible assets) and include
those acquired through business combinations (Note 27).
4
Net operating assets exclude short-term investments, cash, short-term borrowings, loans, Derivative financial instruments, Retirement benefit obligations and non-operating
receivables and payables.
| Property, plant and equipment |
|||
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
UK |
2,847 |
2,831 |
2,526 |
Ireland |
1,323 |
1,164 |
1,040 |
Sweden |
1,692 |
1,678 |
1,472 |
US |
2,856 |
2,371 |
2,176 |
Rest of the world |
1,534 |
1,358 |
1,293 |
Continuing operations |
10,252 |
9,402 |
8,507 |
Geographic markets
The table below shows Product Sales in each geographic market in which customers are located.
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
UK |
1,314 |
978 |
996 |
Rest of Europe |
10,686 |
8,201 |
7,503 |
The Americas |
25,081 |
20,855 |
20,126 |
Asia, Africa & Australasia |
13,857 |
13,755 |
14,373 |
Continuing operations |
50,938 |
43,789 |
42,998 |
Product Sales are recognised when control of the goods has been transferred to a third party. A significant proportion of this is upon delivery
of the products to wholesalers. One wholesaler (2023: one; 2022: one) individually represented greater than 10% of Product Sales. The value
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
169
Assets in |
Total Property, |
|||
Land and |
Plant and |
course of |
plant and |
|
buildings |
equipment |
construction |
equipment |
|
$m |
$m |
$m |
$m |
|
Cost |
||||
At 1 January 2022 |
6,377 |
7,903 |
2,728 |
17,008 |
Capital expenditure |
5 |
19 |
1,042 |
1,066 |
Transfer of assets into use |
226 |
683 |
(909) |
– |
Transfer of Assets held for sale (Note 18) |
(434) |
(293) |
– |
(727) |
Disposals and other movements |
(425) |
(146) |
28 |
(543) |
Exchange adjustments |
(309) |
(610) |
(236) |
(1,155) |
At 31 December 2022 |
5,440 |
7,556 |
2,653 |
15,649 |
Additions through business combinations (Note 27) |
2 |
10 |
– |
12 |
Capital expenditure |
9 |
43 |
1,402 |
1,454 |
Transfer of assets into use |
959 |
1,158 |
(2,117) |
– |
Disposals and other movements |
(6) |
(255) |
(11) |
(272) |
Exchange adjustments |
65 |
192 |
118 |
375 |
At 31 December 2023 |
6,469 |
8,704 |
2,045 |
17,218 |
Additions through business combinations (Note 27) |
1 |
15 |
2 |
18 |
Capital expenditure |
27 |
63 |
1,905 |
1,995 |
Transfer of assets into use |
312 |
729 |
(1,041) |
– |
Disposals and other movements |
(44) |
(271) |
(40) |
(355) |
Exchange adjustments |
(185) |
(386) |
(82) |
(653) |
At 31 December 2024 |
6,580 |
8,854 |
2,789 |
18,223 |
Depreciation and impairment |
||||
At 1 January 2022 |
2,877 |
4,948 |
– |
7,825 |
Depreciation charge for the year |
286 |
566 |
– |
852 |
Impairment charge/(reversal) |
20 |
8 |
(28) |
– |
Transferred to Assets held for sale (Note 18) |
(300) |
(277) |
– |
(577) |
Disposals and other movements |
(227) |
(188) |
28 |
(387) |
Exchange adjustments |
(167) |
(404) |
– |
(571) |
At 31 December 2022 |
2,489 |
4,653 |
– |
7,142 |
Depreciation charge for the year |
241 |
492 |
– |
733 |
Impairment charge |
4 |
4 |
– |
8 |
Disposals and other movements |
(13) |
(220) |
– |
(233) |
Exchange adjustments |
44 |
122 |
– |
166 |
At 31 December 2023 |
2,765 |
5,051 |
– |
7,816 |
Depreciation charge for the year |
231 |
568 |
– |
799 |
Impairment charge |
– |
(7) |
49 |
42 |
Disposals and other movements |
(39) |
(252) |
(49) |
(340) |
Exchange adjustments |
(101) |
(245) |
– |
(346) |
At 31 December 2024 |
2,856 |
5,115 |
– |
7,971 |
Net book value |
||||
At 31 December 2022 |
2,951 |
2,903 |
2,653 |
8,507 |
At 31 December 2023 |
3,704 |
3,653 |
2,045 |
9,402 |
At 31 December 2024 |
3,724 |
3,739 |
2,789 |
10,252 |
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
The net book value of land and buildings comprised: |
|||
Freeholds |
3,329 |
2,976 |
2,555 |
Leaseholds |
395 |
728 |
396 |
Financial Statements
Notes to the Group Financial Statements
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
170
Right-of-use assets
Total |
||||
Land and |
Motor |
Right-of-use |
||
buildings |
vehicles |
Other |
assets |
|
$m |
$m |
$m |
$m |
|
Cost |
||||
At 1 January 2022 |
1,133 |
321 |
33 |
1,487 |
Additions through business combinations (Note 27) |
4 |
– |
– |
4 |
Additions – separately acquired |
140 |
81 |
14 |
235 |
Disposals and other movements |
(33) |
(58) |
(13) |
(104) |
Exchange adjustments |
(62) |
(15) |
(2) |
(79) |
At 31 December 2022 |
1,182 |
329 |
32 |
1,543 |
Additions through business combinations (Note 27) |
8 |
– |
– |
8 |
Additions – separately acquired |
220 |
219 |
5 |
444 |
Disposals and other movements |
(71) |
(57) |
(2) |
(130) |
Exchange adjustments |
13 |
4 |
1 |
18 |
At 31 December 2023 |
1,352 |
495 |
36 |
1,883 |
Additions through business combinations (Note 27) |
20 |
– |
– |
20 |
Additions – separately acquired |
332 |
342 |
18 |
692 |
Disposals and other movements |
(73) |
(140) |
(5) |
(218) |
Exchange adjustments |
(43) |
(33) |
(2) |
(78) |
At 31 December 2024 |
1,588 |
664 |
47 |
2,299 |
Depreciation and impairment |
||||
At 1 January 2022 |
326 |
154 |
19 |
499 |
Depreciation charge for the year |
160 |
80 |
6 |
246 |
Impairment charge |
2 |
– |
– |
2 |
Disposals and other movements |
(54) |
(50) |
(10) |
(114) |
Exchange adjustments |
(23) |
(8) |
(1) |
(32) |
At 31 December 2022 |
411 |
176 |
14 |
601 |
Depreciation charge for the year |
170 |
98 |
7 |
275 |
Impairment charge |
14 |
– |
– |
14 |
Disposals and other movements |
(53) |
(61) |
(2) |
(116) |
Exchange adjustments |
7 |
2 |
– |
9 |
At 31 December 2023 |
549 |
215 |
19 |
783 |
Depreciation charge for the year |
183 |
151 |
9 |
343 |
Impairment charge |
7 |
– |
– |
7 |
Disposals and other movements |
(71) |
(115) |
(6) |
(192) |
Exchange adjustments |
(22) |
(14) |
(1) |
(37) |
At 31 December 2024 |
646 |
237 |
21 |
904 |
Net book value |
||||
At 31 December 2022 |
771 |
153 |
18 |
942 |
At 31 December 2023 |
803 |
280 |
17 |
1,100 |
At 31 December 2024 |
942 |
427 |
26 |
1,395 |
Lease liabilities
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
The present value of lease liabilities is as follows: |
|||
Within one year |
(339) |
(271) |
(228) |
Later than one year and not later than five years |
(825) |
(657) |
(549) |
Later than five years |
(288) |
(200) |
(176) |
Total lease liabilities |
(1,452) |
(1,128) |
(953) |
The interest expense on lease liabilities included within Finance expense was $61m (2023: $33m; 2022: $24m).
The total cash outflow for leases in 2024 was $377m (2023: $301m; 2022: $268m).
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
171
The Group has entered into lease contracts that have not yet commenced. The nominal value of estimated future lease payments under these
lease contracts approximates $1,515m as of 31 December 2024. Of this value, $1,348m relates to a property lease in the US which is expected
to commence in 2026 with a lease term of 15 years.
In 2022 the Group entered into a sale and leaseback agreement in relation to the Waltham R&D site in MA, US. Prior to the sale, the carrying
value of the Property, plant and equipment was $124m. Cash proceeds of $265m were received, recorded within Disposal of property, plant
and equipment within the Consolidated Statement of Cash Flows, and a gain on disposal of $125m was recorded within Other operating
income and expense within the Consolidated Statement of Comprehensive Income. A lease liability and a corresponding right-of-use asset
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Cost |
|||
At 1 January |
20,361 |
20,131 |
20,311 |
Additions through business combinations (Note 27) |
1,083 |
158 |
15 |
Exchange and other adjustments |
(109) |
72 |
(195) |
At 31 December |
21,335 |
20,361 |
20,131 |
Amortisation and impairment losses |
|||
At 1 January |
313 |
311 |
314 |
Exchange and other adjustments |
(3) |
2 |
(3) |
At 31 December |
310 |
313 |
311 |
Net book value |
|||
At 31 December |
21,025 |
20,048 |
19,820 |
Goodwill is tested for impairment at the operating segment level, this being the level at which goodwill is monitored for internal
management purposes. As detailed in Note 6, the Group does not have multiple operating segments and is engaged in a single business
activity of pharmaceuticals.
Recoverable amount is determined on a fair value less costs to sell basis using the market value of the Company’s outstanding Ordinary Shares.
Our market capitalisation is compared to the book value of the Group’s net assets and this indicates a significant surplus at 31 December 2024
Financial Statements
Notes to the Group Financial Statements
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
172
Product, |
Software |
|||
marketing and |
Other |
development |
||
distribution rights |
intangibles |
costs |
Total |
|
$m |
$m |
$m |
$m |
|
Cost |
||||
At 1 January 2022 |
66,590 |
2,611 |
1,432 |
70,633 |
Additions through business combinations (Note 27) |
– |
46 |
– |
46 |
Additions – separately acquired |
2,051 |
12 |
105 |
2,168 |
Disposals |
(57) |
(105) |
(36) |
(198) |
Exchange and other adjustments |
(1,799) |
(122) |
(106) |
(2,027) |
At 31 December 2022 |
66,785 |
2,442 |
1,395 |
70,622 |
Additions through business combinations (Note 27) |
65 |
35 |
– |
100 |
Additions – separately acquired |
2,530 |
200 |
170 |
2,900 |
Disposals |
(669) |
– |
(14) |
(683) |
Exchange and other adjustments |
496 |
30 |
24 |
550 |
At 31 December 2023 |
69,207 |
2,707 |
1,575 |
73,489 |
Additions through business combinations (Note 27) |
2,308 |
56 |
– |
2,364 |
Additions – separately acquired |
2,226 |
150 |
290 |
2,666 |
Disposals |
(294) |
– |
(285) |
(579) |
Exchange and other adjustments |
(964) |
(13) |
(50) |
(1,027) |
At 31 December 2024 |
72,483 |
2,900 |
1,530 |
76,913 |
Amortisation and impairment losses |
||||
At 1 January 2022 |
25,276 |
1,863 |
1,002 |
28,141 |
Amortisation for year |
3,899 |
181 |
76 |
4,156 |
Impairment charges |
236 |
82 |
– |
318 |
Impairment reversals |
(77) |
– |
(17) |
(94) |
Disposals |
(55) |
(105) |
(20) |
(180) |
Exchange and other adjustments |
(887) |
(76) |
(63) |
(1,026) |
At 31 December 2022 |
28,392 |
1,945 |
978 |
31,315 |
Amortisation for year |
3,771 |
75 |
80 |
3,926 |
Impairment charges |
434 |
– |
– |
434 |
Disposals |
(667) |
– |
(12) |
(679) |
Exchange and other adjustments |
336 |
41 |
27 |
404 |
At 31 December 2023 |
32,266 |
2,061 |
1,073 |
35,400 |
Amortisation for year |
3,761 |
78 |
84 |
3,923 |
Impairment charges |
1,577 |
3 |
2 |
1,582 |
Impairment reversals |
(8) |
– |
– |
(8) |
Disposals |
(286) |
– |
(283) |
(569) |
Exchange and other adjustments |
(561) |
(13) |
(18) |
(592) |
At 31 December 2024 |
36,749 |
2,129 |
858 |
39,736 |
Net book value |
||||
At 31 December 2022 |
38,393 |
497 |
417 |
39,307 |
At 31 December 2023 |
36,941 |
646 |
502 |
38,089 |
At 31 December 2024 |
35,734 |
771 |
672 |
37,177 |
Other intangibles consist mainly of research and device technologies and the Alexion brand name. Included within Software development
costs are assets currently in development that will commence amortisation when ready for use.
Included within Additions − separately acquired are amounts of $365m (2023: $625m; 2022: $1,135m), relating to deferred payments and
other non-cash consideration for the acquisition of Product, marketing and distribution rights, which are not reflected in the current year
Consolidated Statement of Cash Flows. Disposals include amounts related to fully amortised or impaired assets that are no longer in use by
the Group.
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
173
Product, |
Software |
|||
marketing and |
Other |
development |
||
distribution rights |
intangibles |
costs |
Total |
|
$m |
$m |
$m |
$m |
|
Year ended 31 December 2022 |
||||
Cost of sales |
32 |
– |
– |
32 |
Research and development expense |
– |
30 |
– |
30 |
Selling, general and administrative expense |
3,867 |
151 |
76 |
4,094 |
Total |
3,899 |
181 |
76 |
4,156 |
Year ended 31 December 2023 |
||||
Cost of sales |
32 |
– |
– |
32 |
Research and development expense |
– |
28 |
– |
28 |
Selling, general and administrative expense |
3,739 |
47 |
80 |
3,866 |
Total |
3,771 |
75 |
80 |
3,926 |
Year ended 31 December 2024 |
||||
Cost of sales |
32 |
1 |
– |
33 |
Research and development expense |
3 |
22 |
– |
25 |
Selling, general and administrative expense |
3,726 |
55 |
84 |
3,865 |
Total |
3,761 |
78 |
84 |
3,923 |
Net impairment charges are recognised in the Consolidated Statement of Comprehensive Income as follows:
Product, |
Software |
|||
marketing and |
Other |
development |
||
distribution rights |
intangibles |
costs |
Total |
|
$m |
$m |
$m |
$m |
|
Year ended 31 December 2022 |
||||
Research and development expense |
95 |
– |
– |
95 |
Selling, general and administrative expense |
64 |
82 |
(17) |
129 |
Total |
159 |
82 |
(17) |
224 |
Year ended 31 December 2023 |
||||
Research and development expense |
417 |
– |
– |
417 |
Selling, general and administrative expense |
17 |
– |
– |
17 |
Total |
434 |
– |
– |
434 |
Year ended 31 December 2024 |
||||
Research and development expense |
1,065 |
– |
– |
1,065 |
Selling, general and administrative expense |
504 |
3 |
2 |
509 |
Total |
1,569 |
3 |
2 |
1,574 |
We perform a rigorous impairment trigger assessment for all our intangible assets. Intangible assets under development and not available
for use are tested annually for impairment and other intangible assets are tested when there is an indication of impairment loss or reversal.
Where testing is required, the recoverable amount of the assets is estimated in order to determine the extent of the impairment loss or
reversal. Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of
the Cash Generating Unit (CGU) to which it belongs. The Group considers that as the intangible assets are linked to individual products and
that product cash flows are considered to be largely independent of other product cash flows, the CGU for intangibles is at the product level.
Group-level budgets and forecasts include forecast capital investment and operational impacts related to sustainability projects, as well as
inflationary impacts, and form the basis for the value in use models used for impairment testing.
An asset’s recoverable amount is determined as the higher of an asset’s or CGU’s fair value less costs to sell or value in use, in both cases
using discounted cash flow calculations where the asset’s expected post-tax cash flows are risk-adjusted over their estimated remaining
period of expected economic benefit. Where the value in use approach is used, the post-tax risk-adjusted cash flows are discounted using
AstraZeneca’s post-tax weighted average cost of capital (7.5% for 2024, 7.5% for 2023 and 7% for 2022) which is a nominal rate. There is
no material difference in the approach taken to using pre-tax cash flows and a pre-tax rate compared to post-tax cash flows and a post-tax
rate, as required by IAS 36 ‘Impairment of Assets’. Where fair value less costs to sell is used to determine recoverable value, the discount
rate is assessed with reference to a market participant, this is not usually materially different to the AstraZeneca post-tax weighted average
cost of capital of 7.5%. Intangible assets have been tested for impairment under the value in use basis at risk-adjusted post-tax discount
rates ranging between 7.5% to 9.5%.
SE
Key assumptions and significant estimates used in calculating the recoverable amounts are highly sensitive and specific to the nature of
the Group’s activities including:
•
outcome of R&D activities
•
probability of technical and regulatory success
•
market volume, share and pricing (to derive peak year sales)
•
amount and timing of projected future cash flows
•
sales erosion curves following patent expiry.
Financial Statements
Notes to the Group Financial Statements
continued
10 Intangible assets
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
174
Whilst the intangible assets portfolio is generally exposed to significant impairment risk within the next financial year, no sensitivities have been
disclosed since no specific asset has been identified as having a significant risk of a material impairment arising from reasonably possible
changes in key assumptions.
For assets held at fair value less costs to sell, we make appropriate adjustments to reflect market participant assessments.
In 2024, the Group recorded impairment charges of $504m in respect of launched products. Following a strategic review of our portfolio
priorities, a business decision was made to cease promotional activity for
Andexxa
resulting in impairment charges of $504m recorded
against the
Andexxa
intangible asset under a value-in-use model applying a discount rate of 7.5% (revised carrying amount: $nil).
Impairment charges recorded against products in development totalled $1,073m. This included full impairments of vemircopan (ALXN2050)
($753m, acquired as part of the Alexion business combination in 2021), following outcome of research activities, and FPI-2059 ($165m, acquired
as part of the Fusion business combination in 2024) due to portfolio prioritisation decisions. The remaining impairments of $155m relate to
impairments of various products in development, due to either management’s decision to discontinue development as part of Group-wide
portfolio prioritisation decisions, or due to the outcome of research activities.
In 2023, the Group recorded impairment charges of $17m in respect of launched products. Impairment charges recorded against products in
development totalled $417m, including $244m related to ALXN1840 which was fully impaired following the decision to discontinue development.
In 2022, the Group recorded impairment charges of $146m in respect of launched products. Impairment charges recorded against products
in development totalled $172m due to decisions made to terminate the related activities.
The Group has performed an assessment on assets which have had impairments recorded in previous periods to determine if any reversals of
impairments were required. Impairment reversals of $8m were recorded in 2024 against products in development. No impairment reversals
were recorded in 2023. Impairment reversals of $94m were recorded in 2022, including $77m in respect of products in development.
When launched products are partially impaired, the carrying values of these assets in future periods are particularly sensitive to changes in
Significant assets
Carrying |
Remaining |
|
value |
amortisation |
|
$m |
period |
|
C5 franchise ( Soliris / Ultomiris ) intangible assets arising from the acquisition of Alexion |
12,667 |
3 to 11 years |
Intangible assets arising from the acquisition of Acerta Pharma |
3,853 |
8 years |
Strensiq , Kanuma intangible assets arising from the acquisition of Alexion |
3,221 |
8 to 14 years |
Enhertu intangible assets acquired from Daiichi Sankyo |
2,534 |
9 years |
Intangible asset products in development arising from the acquisition of Alexion 1 |
1,913 |
Not amortised |
Intangible assets arising from the acquisition of ZS Pharma |
1,548 |
7 years |
Intangible asset products in development arising from the acquisition of Fusion 1 |
1,161 |
Not amortised |
Intangible asset products in development arising from the acquisition of Gracell 1 |
983 |
Not amortised |
Datroway intangible assets acquired from Daiichi Sankyo 1 |
974 |
Not amortised |
Baxdrostat intangible asset acquired from CinCor 1 |
790 |
Not amortised |
Intangible asset products in development arising from the acquisition of Amolyt 1 |
768 |
Not amortised |
Intangible asset products in development arising from the acquisition of Icosavax 1 |
639 |
Not amortised |
Airsupra intangible asset |
500 |
10 years |
Intangible assets arising from the restructuring of a historical joint venture with MSD |
375 |
2 to 5 years |
Monalizumab intangible assets acquired from Innate Pharma 1 |
364 |
Not amortised |
Intangible assets arising from the acquisition of Pearl Therapeutics |
309 |
4 to 5 years |
Rare disease portfolio assets acquired from Pfizer 1 |
300 |
Not amortised |
1
Assets in development are not amortised but are tested annually for impairment.
In 2024, the intangible assets recognised on acquisition of Amolyt and Icosavax were separately assessed under the optional concentration
test in IFRS 3 ‘Business Combinations’ and were individually determined to be asset acquisitions, as substantially all of the value of the gross
assets acquired in each transaction was concentrated in these single assets.
The intangible asset baxdrostat recognised on acquisition of CinCor in 2023 was assessed under the optional concentration test in IFRS 3 and
was determined to be an asset acquisition, as substantially all of the value of the gross assets acquired was concentrated in this single asset.
The acquisition of Pfizer’s pre-clinical rare disease gene therapy portfolio in 2023 was assessed under IFRS 3 and the transaction was treated
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
175
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
At 1 January |
147 |
76 |
69 |
Additions |
158 |
80 |
26 |
Share of after tax losses |
(28) |
(12) |
(5) |
Exchange and other adjustments |
(9) |
3 |
(14) |
At 31 December |
268 |
147 |
76 |
On 22 May 2024, AstraZeneca entered into an agreement with Fuse Biosciences (Cayman) Limited to acquire equity. Under the terms of the
agreement, AstraZeneca contributed $11m in initial funds, holds 25% board representation, and holds a 18.75% interest in the associate entity.
On 1 November 2023, AstraZeneca entered into an agreement with Cellectis, a clinical-stage biotechnology company, to accelerate the
development of next generation therapeutics in areas of high unmet medical need, including oncology, immunology and rare diseases.
Under the terms of the agreement, AstraZeneca contributed $80m in funds for a 22% interest in the associate entity. On 22 May 2024,
a further contribution of $140m was made for a further 22% interest. AstraZeneca holds a 44% interest in the associate entity.
On 29 January 2021, AstraZeneca entered into an agreement with IHP Holdings Limited to create and run an online platform (iHospital) offering
consultations with physicians, repeat prescriptions and e-pharmacy in China. The agreement resulted in the formation of a new entity, IHP
HK Holdings Limited. AstraZeneca contributed $30m in initial funds and holds a 50% interest in the associate entity.
On 1 December 2020, AstraZeneca and China International Capital Corporation (CICC) entered into an agreement to set up a Global Healthcare
Industrial Fund to drive healthcare system innovation by leveraging local capital and accelerating China-related innovation incubation. The
agreement resulted in the formation of a new entity, Wuxi AstraZeneca-CICC Venture Capital Partnership (Limited Partnership). AstraZeneca
holds a 22% interest in the associate entity and contributed $1m in initial funds in 2020, with contributions of $45m, $21m and $7m made in
2021, 2022 and 2024 respectively.
On 23 September 2021, AstraZeneca entered into an agreement with VaxEquity Limited (‘VaxEquity’) to collaborate and develop self-amplifying
RNA technology with the aim of generating treatments for target diseases. AstraZeneca contributed $14m in initial funds and holds a 40%
interest in the associate entity. On 13 April 2024, VaxEquity entered a voluntary liquidation process.
On 27 November 2017, AstraZeneca entered into a joint venture agreement with Chinese Future Industry Investment Fund (FIIF), to discover,
develop and commercialise potential new medicines to help address unmet medical needs globally, and to bring innovative new medicines to
patients in China more quickly. The agreement resulted in the formation of a joint venture entity based in China, Dizal (Jiangsu) Pharmaceutical
Co., Ltd. Since its establishment, AstraZeneca has contributed $80m in cash to the joint venture entity and has a 26% interest in the joint venture.
On 1 December 2015, AstraZeneca entered into a joint venture agreement with Fujifilm Kyowa Kirin Biologics Co., Ltd. to develop a biosimilar
using the combined capabilities of the two parties. The agreement resulted in the formation of a joint venture entity based in the UK, Centus
Biotherapeutics Limited (‘Centus’). Since its establishment, AstraZeneca has contributed $135m in cash to the joint venture entity and has a
50% interest in the joint venture which has a carrying value of $nil (2023: $nil; 2022: $nil). On 7 May 2024 Centus was dissolved.
All investments are accounted for using the equity method. At 31 December 2024, unrecognised losses in associates and joint ventures
totalled $177m (2023: $140m; 2022: $92m) which have not been recognised due to the investment carrying value reaching $nil value.
Aggregated summarised financial information for the associate and joint venture entities is set out below:
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Non-current assets |
577 |
424 |
290 |
Current assets |
508 |
362 |
300 |
Total liabilities |
(516) |
(287) |
(72) |
Net assets |
569 |
499 |
518 |
Amount attributable to AstraZeneca |
131 |
85 |
91 |
Goodwill |
152 |
52 |
– |
Exchange adjustments |
(15) |
10 |
(15) |
Carrying value of investments in associates and joint ventures |
268 |
147 |
76 |
Joint contractual arrangements were entered into between AstraZeneca and Daiichi Sankyo; in March 2019 for the co-development and
co-commercialisation of
Enhertu
and in July 2020 for the co-development and co-commercialisation of
Datroway
. Each party shares global
pre-tax net income from the collaboration on a 50:50 basis (with the exception of Japan where Daiichi Sankyo maintains exclusive rights
and AstraZeneca receives a royalty). The joint operation is not structured through a separate legal entity, and it operates from AstraZeneca
Financial Statements
Notes to the Group Financial Statements
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
176
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Non-current investments |
|||
Equity securities at fair value through Other comprehensive income |
1,632 |
1,530 |
1,056 |
Fixed income securities at fair value through profit or loss |
– |
– |
10 |
Total |
1,632 |
1,530 |
1,066 |
Current investments |
|||
Fixed income securities at fair value through profit or loss |
37 |
20 |
13 |
Cash collateral pledged to counterparties |
129 |
102 |
162 |
Fixed deposits |
– |
– |
64 |
Total |
166 |
122 |
239 |
Other investments held at FVOCI include equity securities which are not held for trading and which the Group has irrevocably elected at initial
recognition to recognise in this category. Other investments held at FVPL mainly comprise fixed income securities that the Group holds to sell.
The fair value of listed investments is based on year end quoted market prices. Fixed deposits and Cash collateral pledged to counterparties
are held at amortised cost with carrying value being a reasonable approximation of fair value given their short-term nature.
Cash collateral pledged to counterparties relates to collateral pledged on derivatives entered into to hedge the Group’s risk exposures.
Fair value hierarchy
The table below analyses equity securities and bonds, contained within Other investments and carried at fair value, by valuation method.
The different levels have been defined as follows:
•
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities
•
Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices)
or indirectly (i.e. derived from prices)
•
Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
2024 |
2024 |
2023 |
2023 |
2022 |
2022 |
|
FVPL |
FVOCI |
FVPL |
FVOCI |
FVPL |
FVOCI |
|
$m |
$m |
$m |
$m |
$m |
$m |
|
Level 1 |
37 |
1,279 |
20 |
1,217 |
13 |
880 |
Level 2 |
– |
– |
– |
– |
– |
– |
Level 3 |
– |
353 |
– |
313 |
10 |
176 |
Total |
37 |
1,632 |
20 |
1,530 |
23 |
1,056 |
Assets are transferred in or out of each Level on the date of the event or change in circumstances that caused the transfer.
Equity securities that are analysed at Level 3 include investments in private biotech companies. In the absence of specific market data, these
unlisted investments are held at fair value based on the cost of investment and adjusting as necessary for impairments and revaluations on
new funding rounds, which approximates to fair value. Movements in Level 3 investments are detailed below:
2024 |
2024 |
2023 |
2023 |
2022 |
2022 |
|
FVPL |
FVOCI |
FVPL |
FVOCI |
FVPL |
FVOCI |
|
$m |
$m |
$m |
$m |
$m |
$m |
|
At 1 January |
– |
313 |
10 |
176 |
– |
104 |
Additions |
– |
56 |
– |
127 |
10 |
32 |
Revaluations |
– |
(9) |
3 |
14 |
– |
50 |
Net transfers out from Level 3 to Level 1 |
– |
– |
– |
– |
– |
(4) |
Disposals |
– |
– |
(13) |
(8) |
– |
(5) |
Impairments and exchange adjustments |
– |
(7) |
– |
4 |
– |
(1) |
At 31 December |
– |
353 |
– |
313 |
10 |
176 |
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
177
Non-current |
Current |
Current |
Non-current |
||
assets |
assets |
liabilities |
liabilities |
Total |
|
$m |
$m |
$m |
$m |
$m |
|
Interest rate swaps related to instruments designated |
|||||
at fair value through profit or loss 1 |
– |
1 |
– |
– |
1 |
Cross-currency swaps designated in a net investment hedge |
55 |
– |
– |
(4) |
51 |
Cross-currency swaps designated in a cash flow hedge |
– |
– |
– |
(160) |
(160) |
Forward FX designated in a cash flow hedge 2 |
– |
1 |
(13) |
– |
(12) |
Other derivatives |
19 |
85 |
(80) |
– |
24 |
31 December 2022 |
74 |
87 |
(93) |
(164) |
(96) |
Non-current |
Current |
Current |
Non-current |
||
assets |
assets |
liabilities |
liabilities |
Total |
|
$m |
$m |
$m |
$m |
$m |
|
Cross-currency swaps designated in a net investment hedge |
100 |
– |
– |
(1) |
99 |
Cross-currency swaps designated in a cash flow hedge |
116 |
– |
(30) |
(37) |
49 |
Forward FX designated in a cash flow hedge 2 |
– |
19 |
(4) |
– |
15 |
Other derivatives |
12 |
97 |
(122) |
– |
(13) |
31 December 2023 |
228 |
116 |
(156) |
(38) |
150 |
Non-current |
Current |
Current |
Non-current |
||
assets |
assets |
liabilities |
liabilities |
Total |
|
$m |
$m |
$m |
$m |
$m |
|
Cross-currency swaps designated in a net investment hedge |
148 |
– |
– |
– |
148 |
Cross-currency swaps designated in a cash flow hedge |
34 |
– |
– |
(71) |
(37) |
Cross-currency swaps designated in a fair value hedge |
– |
– |
– |
(44) |
(44) |
Forward FX designated in a cash flow hedge 2 |
– |
5 |
(1) |
– |
4 |
Other derivatives |
– |
49 |
(49) |
– |
– |
31 December 2024 |
182 |
54 |
(50) |
(115) |
71 |
1
Interest rate swaps related to instruments designated at fair value through profit or loss matured in 2023.
2
Forward FX designated in a cash flow hedge relates to contracts hedging anticipated CNY, EUR, GBP, JPY and SEK transactions occurring in the quarter immediately after the balance
sheet date.
All derivatives are held at fair value and fall within Level 2 of the fair value hierarchy as defined in Note 12, except for an equity warrant which
falls within Level 3 (valued at $nil
(2023: $12m; 2022: $19m), held within Non-current assets). None of the derivatives have been reclassified
in the year. The equity warrant expired on 31 December 2024. Its value at that date was recorded as zero.
The fair value of interest rate swaps and cross-currency swaps is estimated using appropriate zero coupon curve valuation techniques to
discount future contractual cash flows based on rates at the current year end.
The fair value of forward foreign exchange contracts and currency options are estimated by cash flow accounting models using appropriate
yield curves based on market forward foreign exchange rates at the year end. The majority of forward foreign exchange contracts for existing
transactions had maturities of less than one month from year end.
The interest rates used to discount future cash flows for fair value adjustments, where applicable, are based on market swap curves at the
reporting date, and were as follows:
2024 |
2023 |
2022 |
|
Derivatives |
0.6% to 4.1% |
0.1% to 5.3% |
0.1% to 4.7% |
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Prepayments |
356 |
274 |
243 |
Accrued income |
60 |
52 |
44 |
Retirement benefit scheme surpluses (Note 22) |
99 |
92 |
90 |
Other receivables |
415 |
385 |
458 |
Non-current other receivables |
930 |
803 |
835 |
Other receivables include $nil (2023: $51m; 2022: $71m) owed by FibroGen, Inc. for promotional activity in China pursuant to the
Financial Statements
Notes to the Group Financial Statements
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
178
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Raw materials and consumables |
1,489 |
1,531 |
1,422 |
Inventories in process |
2,282 |
2,325 |
1,864 |
Finished goods and goods for resale |
1,517 |
1,568 |
1,413 |
Inventories |
5,288 |
5,424 |
4,699 |
The Group recognised $7,001m (2023: $6,038m; 2022: $9,618m) of inventories as an expense within Cost of sales during the year.
Inventory write-downs in the year amounted to $664m (2023: $574m; 2022: $479m), principally arising from the reassessment of usage or
demand expectations prior to inventory expiration. Inventory write-downs in the year included $407m in relation to
Andexxa
following the
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Trade receivables |
8,335 |
8,452 |
7,271 |
Less: Expected credit loss provision (Note 28) |
(33) |
(45) |
(59) |
8,302 |
8,407 |
7,212 |
|
Other receivables |
1,579 |
1,639 |
1,659 |
Prepayments |
1,737 |
1,617 |
1,329 |
Government grants receivable |
25 |
11 |
25 |
Accrued income |
1,329 |
452 |
296 |
Trade and other receivables |
12,972 |
12,126 |
10,521 |
Trade receivables include $667m (2023: $1,977m; 2022: $2,470m) measured at FVOCI classified ‘hold to collect and sell’ as they are due
from customers that the Group has the option to factor, or relate to bank acceptance drafts received in settlement of trade receivables per
common practice in China.
All other financial assets included within Current trade and other receivables are held at amortised cost with carrying value being a reasonable
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Cash at bank and in hand |
1,215 |
1,325 |
1,411 |
Short-term deposits |
4,273 |
4,515 |
4,755 |
Cash and cash equivalents |
5,488 |
5,840 |
6,166 |
Unsecured bank overdrafts |
(59) |
(203) |
(183) |
Cash and cash equivalents in the Consolidated Statement of Cash Flows |
5,429 |
5,637 |
5,983 |
AstraZeneca invests in constant net asset value funds, low-volatility net asset value funds and short-term variable net asset value funds with
same day access for subscription and redemption. These investments fail the ‘solely payments of principal and interest’ test criteria under
IFRS 9 ‘Financial Instruments’. They are therefore measured at FVPL, although the fair value is materially the same as amortised cost.
Non-cash and other movements, within operating activities in the Consolidated Statement of Cash Flows, includes:
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Share-based payments charge for the period |
660 |
579 |
619 |
Settlement of share plan awards |
(618) |
(650) |
(592) |
Pension contributions |
(166) |
(188) |
(205) |
Pension charges recorded in operating profit |
86 |
55 |
101 |
Long-term provision charges recorded in operating profit |
106 |
460 |
87 |
Loss/(gain) on disposal of tangible assets |
4 |
(41) |
(112) |
Update to the contractual relationships for Beyfortus |
– |
(729) |
– |
Foreign exchange and other 1 |
(193) |
128 |
(590) |
Total operating activities non-cash and other movements |
(121) |
(386) |
(692) |
1
Foreign exchange and other includes, among other items, the foreign exchange of inter-company transactions, including dividends, across Group entities and the related impact
Assets held for sale amount to $nil (2023: $nil; 2022: $150m).
In 2022, Assets held for sale comprised Property, plant and equipment assets relating to the West Chester site in Ohio, US. The transaction
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
179
Repayment | 2024 | 2023 | 2022 | ||
dates | $m | $m | $m | ||
Current liabilities | |||||
Bank overdrafts | On demand | 59 | 203 | 183 | |
Other short-term borrowings excluding overdrafts | 90 | 97 | 78 | ||
Collateral received from derivative counterparties | 181 | 215 | 89 | ||
Lease liabilities | 339 | 271 | 228 | ||
0.3% Callable bond | US dollars | 2023 | – | – | 1,399 |
2023 Floating bank loan | US dollars | 2023 | – | – | 2,000 |
Floating rate notes | US dollars | 2023 | – | – | 400 |
3.5% Callable bond | US dollars | 2023 | – | – | 849 |
7% Guaranteed debentures | US dollars | 2023 | – | – | 294 |
0.75% Callable bond | euros | 2024 | – | 995 | – |
0.7% Callable bond | US dollars | 2024 | – | 1,600 | – |
2024 Floating rate bank loans | US dollars | 2024 | – | 2,000 | – |
3.375% Callable bond | US dollars | 2025 | 1,997 | – | – |
Other loans | Within one year | 10 | 19 | 22 | |
Total | 2,676 | 5,400 | 5,542 |
Non-current liabilities | |||||
Lease liabilities | 1,113 | 857 | 725 | ||
0.75% Callable bond | euros | 2024 | – | – | 957 |
0.7% Callable bond | US dollars | 2024 | – | – | 1,598 |
2024 Floating bank loans | US dollars | 2024 | – | – | 1,998 |
3.375% Callable bond | US dollars | 2025 | – | 1,994 | 1,992 |
0.7% Callable bond | US dollars | 2026 | 1,198 | 1,196 | 1,195 |
1.2% Callable bond | US dollars | 2026 | 1,249 | 1,248 | 1,246 |
4.8% Callable bond | US dollars | 2027 | 1,247 | – | – |
3.625% Callable bond | euros | 2027 | 780 | 829 | – |
3.125% Callable bond | US dollars | 2027 | 748 | 747 | 746 |
4.875% Callable bond | US dollars | 2028 | 1,096 | 1,095 | – |
1.25% Callable bond | euros | 2028 | 829 | 879 | 845 |
1.75% Callable bond | US dollars | 2028 | 1,247 | 1,246 | 1,245 |
4% Callable bond | US dollars | 2029 | 996 | 995 | 995 |
4.85% Callable bond | US dollars | 2029 | 1,246 | – | – |
0.375% Callable bond | euros | 2029 | 829 | 881 | 846 |
4.9% Callable bond | US dollars | 2030 | 646 | 645 | – |
3.121% Callable bond | euros | 2030 | 682 | – | – |
1.375% Callable bond | US dollars | 2030 | 1,295 | 1,294 | 1,293 |
4.9% Callable bond | US dollars | 2031 | 994 | – | – |
2.25% Callable bond | US dollars | 2031 | 747 | 747 | 747 |
5.75% Non-callable bond | pound sterling | 2031 | 438 | 444 | 420 |
3.75% Callable bond | euros | 2032 | 778 | 827 | – |
4.875% Callable bond | US dollars | 2033 | 497 | 497 | – |
3.278% Callable bond | euros | 2033 | 786 | – | – |
5% Callable bond | US dollars | 2034 | 1,489 | – | – |
6.45% Callable bond | US dollars | 2037 | 2,727 | 2,725 | 2,724 |
4% Callable bond | US dollars | 2042 | 989 | 989 | 988 |
4.375% Callable bond | US dollars | 2045 | 982 | 981 | 981 |
4.375% Callable bond | US dollars | 2048 | 738 | 738 | 737 |
2.125% Callable bond | US dollars | 2050 | 487 | 487 | 487 |
3% Callable bond | US dollars | 2051 | 735 | 735 | 735 |
Other loans | US dollars | 31 | 146 | 190 | |
Total | 27,619 | 23,222 | 23,690 | ||
Total interest-bearing loans and borrowings 1 | 30,295 | 28,622 | 29,232 |
1
All loans and borrowings above are unsecured. In previous years, there were current (2023: $nil; 2022: $22m) and non-current (2023: $nil; 2022: $181m) secured loans, both included
within Other loans.
Financial Statements
Notes to the Group Financial Statements
continued
19 Interest-bearing loans and borrowings
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
180
Total |
Total |
Total |
|
loans and |
loans and |
loans and |
|
borrowings |
borrowings |
borrowings |
|
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
At 1 January |
28,622 |
29,232 |
30,781 |
Changes from financing cash flows |
|||
Issue of loans and borrowings |
6,492 |
3,816 |
– |
Repayment of loans and borrowings |
(4,652) |
(4,942) |
(1,271) |
Movement in short-term borrowings |
(31) |
161 |
74 |
Repayment of obligations under leases |
(316) |
(268) |
(244) |
Total changes in cash flows arising on financing activities from borrowings |
1,493 |
(1,233) |
(1,441) |
Movement in overdrafts |
(144) |
20 |
(85) |
New lease liabilities |
710 |
444 |
253 |
Additions through business combinations |
12 |
– |
5 |
Exchange |
(361) |
187 |
(287) |
Other movements |
(37) |
(28) |
6 |
At 31 December |
30,295 |
28,622 |
29,232 |
Also included within Cash flows from financing activities within the Consolidated Statement of Cash Flows is a $833m cash outflow (2023: $867m;
2022: $920m) related to the Acerta Pharma share purchase liability which has a closing liability at 31 December 2024 of $nil (2023: $833m;
2022: $1,646m) within Trade and other payables (see Note 20
).
Set out below is a comparison by category of carrying values and fair values of all the Group’s interest-bearing loans and borrowings:
Instruments |
Instruments |
Instruments |
Total |
|||
designated |
designated in |
designated in |
Amortised |
carrying |
Fair |
|
at fair value 1 |
cash flow hedge 2 |
fair value hedge 3 |
cost |
value |
value |
|
$m |
$m |
$m |
$m |
$m |
$m |
|
2022 |
||||||
Overdrafts |
– |
– |
– |
183 |
183 |
183 |
Lease liabilities due within one year |
– |
– |
– |
228 |
228 |
228 |
Lease liabilities due after more than one year |
– |
– |
– |
725 |
725 |
725 |
Loans and borrowings due within one year |
294 |
– |
– |
4,837 |
5,131 |
5,105 |
Loans and borrowings due after more than one year |
– |
1,802 |
– |
21,163 |
22,965 |
21,657 |
Total at 31 December 2022 |
294 |
1,802 |
– |
27,136 |
29,232 |
27,898 |
2023 |
||||||
Overdrafts |
– |
– |
– |
203 |
203 |
203 |
Lease liabilities due within one year |
– |
– |
– |
271 |
271 |
271 |
Lease liabilities due after more than one year |
– |
– |
– |
857 |
857 |
857 |
Loans and borrowings due within one year |
– |
995 |
– |
3,931 |
4,926 |
4,887 |
Loans and borrowings due after more than one year |
– |
2,535 |
– |
19,830 |
22,365 |
21,769 |
Total at 31 December 2023 |
– |
3,530 |
– |
25,092 |
28,622 |
27,987 |
2024 |
||||||
Overdrafts |
– |
– |
– |
59 |
59 |
59 |
Lease liabilities due within one year |
– |
– |
– |
339 |
339 |
339 |
Lease liabilities due after more than one year |
– |
– |
– |
1,113 |
1,113 |
1,113 |
Loans and borrowings due within one year |
– |
– |
– |
2,278 |
2,278 |
2,263 |
Loans and borrowings due after more than one year |
– |
2,387 |
1,468 |
22,651 |
26,506 |
25,405 |
Total at 31 December 2024³ |
– |
2,387 |
1,468 |
26,440 |
30,295 |
29,179 |
1
Instruments designated at FVPL include the US dollar 7% guaranteed debentures which matured on 15 November 2023.
2
Instruments designated in cash flow hedges are our euro 900m 0.75% 2024 Callable bond which matured in 2024, our euro 750m 3.625% 2027 Callable bond, our euro 800m
1.25% 2028 Callable bond, and our euro 750m 3.75% 2032 Callable bond.
3
Instruments designated in fair value hedges are our euro 650m 3.121% 2030 Callable bond, and our euro 750m 3.278% 2033 Callable bond.
The fair value of fixed-rate publicly traded debt is based on year end quoted market prices; the fair value of floating rate debt is nominal value,
as mark-to-market differences would be minimal given the frequency of resets. The carrying value of loans designated at FVPL is the fair
value; this falls within the Level 1 valuation method as defined in Note 12. For loans designated in a fair value hedge relationship, carrying
value is initially measured at fair value and remeasured for fair value changes in respect of the hedged risk at each reporting date. All other
loans are held at amortised cost. Fair values, as disclosed in the table above, are all determined using the Level 1 valuation method as defined
in Note 12, with the exception of overdrafts and lease liabilities, where fair value approximates to carrying values.
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
181
The cumulative adjustment to the carrying value of bonds designated in a fair value hedge relationship in the year was an increase in the
liability of $16m. A loss of $2m was made during the year on the fair value of bonds designated in a fair value hedge, due to increased credit
risk. Under IFRS 9 ‘Financial Instruments’, the Group records the component of fair value changes relating to the component of own credit
risk through Other comprehensive income. Changes in credit risk had no material effect on any other financial assets and liabilities recognised
at fair value in the Group Financial Statements. The change in fair value attributable to changes in credit risk is calculated as the change in
fair value not attributable to market risk.
The interest rates used to discount future cash flows for fair value adjustments, where applicable, are based on market swap curves at the
reporting date, and were as follows:
2024 |
2023 |
2022 |
|
Loans and borrowings |
2.0% to 2.9% |
n/a to n/a 1 |
4.3% to 4.9% |
1
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Current liabilities |
|||
Trade payables |
3,640 |
3,267 |
2,550 |
Value-added and payroll taxes and social security |
401 |
492 |
468 |
Rebates, chargebacks, returns and other revenue accruals |
7,805 |
7,817 |
6,078 |
Clinical trial accruals |
1,419 |
1,424 |
1,417 |
Other accruals |
6,463 |
6,112 |
5,551 |
Collaboration Revenue contract liabilities |
7 |
7 |
12 |
Vaccine contract liabilities |
119 |
142 |
169 |
Deferred government grant income |
– |
– |
1 |
Contingent consideration |
1,170 |
966 |
757 |
Acerta Pharma share purchase liability |
– |
833 |
867 |
Other payables |
1,441 |
1,314 |
1,170 |
Total |
22,465 |
22,374 |
19,040 |
Non-current liabilities |
|||
Accruals |
65 |
36 |
37 |
Collaboration Revenue contract liabilities |
– |
7 |
14 |
Contingent consideration |
581 |
1,171 |
1,465 |
Acerta Pharma share purchase liability |
– |
– |
779 |
Other payables |
1,124 |
1,446 |
1,975 |
Total |
1,770 |
2,660 |
4,270 |
Included within Rebates, chargebacks, returns and other revenue accruals are contract liabilities of $114m (2023: $102m; 2022: $87m).
The revenue recognised in the year from opening contract liabilities is $96m, comprising $89m relating to other revenue accruals and $7m
Collaboration Revenue contract liabilities. The major markets with Rebates, chargebacks, returns and other revenue accruals are the US
where the liability at 31 December 2024 amounted to $4,978m (2023: $5,116m; 2022: $3,961m), of which Rare Disease comprises $240m
(2023: $190m; 2022: $139m), and China where the liability at 31 December 2024 amounted to $532m (2023: $567m; 2022: $579m).
Trade payables includes $105m (2023: $123m; 2022: $67m) due to suppliers that have signed up to a supply chain financing programme,
under which the suppliers can elect on an invoice-by-invoice basis to receive a discounted early payment from the relationship bank rather
than being paid in line with the agreed payment terms. If the option is taken, the Group’s liability is assigned by the supplier to be due to
the relationship bank rather than the supplier. The value of the liability payable by the Group remains unchanged. The Group assesses the
arrangement against indicators to assess if debts which vendors have sold to the funder under the supplier financing scheme continue to
meet the definition of trade payables or should be classified as borrowings. At 31 December 2024, the payables met the criteria of Trade
payables. The supply chain financing programme operates in the US, UK, Sweden, China and Germany, and as at 31 December 2024, the
programme had 458 suppliers enrolled across these countries.
Vaccine contract liabilities relate to amounts received from customers, primarily government bodies, in advance of supply of product.
Included within current Other payables are liabilities to Daiichi Sankyo totalling $377m (2023: $199m; 2022: $100m) resulting from the
collaboration agreement in relation to
Enhertu
entered into in March 2019. Additionally, included within non-current Other payables are
liabilities totalling $456m (2023: $774m; 2022: $1,125m) as a result of the
Enhertu
collaboration agreement and $462m (2023: $464m;
2022: $nil) owed to Avillion as a result of the
Airsupra
collaboration agreement entered into in March 2018.
Financial Statements
Notes to the Group Financial Statements
continued
20 Trade and other payables
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
182
In November 2020,
Calquence
received marketing approval in the EU, which removed all remaining conditionality in respect of the Acerta
Pharma put and call options regarding the non-controlling interest; the option was exercised in April 2021. The payments were made in
similar annual instalments in 2022 through to 2024, with the first payment of $920m made in 2022, the second payment of $867m made in
2023 and the final payment of $833m made in 2024, with a closing liability as at 31 December 2024 of $nil (2023: $833m; 2022: $1,646m).
Interest arising from amortising the liability is included within Finance expense (see Note 3). The associated cash flows were disclosed as
financing activities within the Consolidated Statement of Cash Flows.
With the exception of Contingent consideration payables of $1,751m (2023: $2,137m; 2022: $2,222m) which are held at fair value within
Level 3 of the fair value hierarchy as defined in Note 12, all other financial liabilities are held at amortised cost with carrying value being a
reasonable approximation of fair value.
Contingent consideration | |||
2024 | 2023 | 2022 | |
$m | $m | $m | |
At 1 January | 2,137 | 2,222 | 2,865 |
Additions through business combinations | 198 | 60 | – |
Settlements | (1,008) | (826) | (772) |
Disposals | – | – | (121) |
Revaluations | 311 | 549 | 82 |
Discount unwind (Note 3) | 113 | 132 | 168 |
At 31 December | 1,751 | 2,137 | 2,222 |
Contingent consideration arising from business combinations is fair valued using decision-tree analysis, with key inputs including the probability
of success, consideration of potential delays and the expected levels of future revenues.
Revaluations of Contingent consideration are recognised in Selling, general and administrative expense and include an increase of $260m in
2024 (2023: $520m; 2022: $182m) based on revised milestone probabilities, and revenue and royalty forecasts, relating to the acquisition of
BMS’s share of the Global Diabetes Alliance. Discount unwind on the liability is included within Finance expense (see Note 3).
The discount rate used for the Contingent consideration balances range from 5% to 8%. The most significant Contingent consideration
balance is the Global Diabetes Alliance which is discounted at 8% and is reviewed against comparable benchmarks on a regular basis.
Management has identified that reasonably possible changes in certain key assumptions, including the likelihood of achieving successful
trial results, obtaining regulatory approval, the projected market share of the therapy area and expected pricing for launched products, may
cause the calculated fair value of the above contingent consideration to vary materially in future years.
The contingent consideration balance relating to BMS’s share of Global Diabetes Alliance of $1,309m (2023: $1,945m; 2022: $2,124m) would
increase/decrease by $131m with an increase/decrease in sales of 10% as compared with the current estimates.
The maximum development and sales milestones payable under outstanding Contingent consideration arrangements arising on business
combinations are as follows:
Nature of |
Maximum future milestones |
||
Acquisitions |
Year |
contingent consideration |
$m |
Spirogen |
2013 |
Milestones |
171 |
Amplimmune, Inc. |
2013 |
Milestones |
150 |
Almirall |
2014 |
Milestones and royalties |
345 |
Neogene |
2023 |
Milestones |
110 |
Fusion |
2024 |
Milestones |
304 |
Gracell |
2024 |
Milestones |
149 |
The amount of royalties payable under the arrangements is inherently uncertain and difficult to predict, given the direct link to future sales
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
183
Employee |
Other |
|||||
Severance |
Environmental |
benefits |
Legal |
provisions |
Total |
|
$m |
$m |
$m |
$m |
$m |
$m |
|
At 1 January 2022 |
212 |
90 |
195 |
239 |
988 |
1,724 |
Charge for year |
227 |
61 |
1 |
830 |
365 |
1,484 |
Cash paid |
(223) |
(19) |
(41) |
(814) |
(185) |
(1,282) |
Reversals |
(43) |
– |
(27) |
(94) |
(98) |
(262) |
Exchange and other movements |
(8) |
(1) |
15 |
– |
(52) |
(46) |
At 31 December 2022 |
165 |
131 |
143 |
161 |
1,018 |
1,618 |
Charge for year |
123 |
21 |
22 |
1,102 |
245 |
1,513 |
Cash paid |
(87) |
(41) |
(14) |
(219) |
(404) |
(765) |
Reversals |
(28) |
(3) |
(3) |
(23) |
(143) |
(200) |
Exchange and other movements |
3 |
4 |
20 |
(5) |
(33) |
(11) |
At 31 December 2023 |
176 |
112 |
168 |
1,016 |
683 |
2,155 |
Additions arising on business acquisitions |
– |
– |
– |
– |
50 |
50 |
Charge for year |
283 |
26 |
30 |
44 |
478 |
861 |
Cash paid |
(101) |
(33) |
(7) |
(189) |
(146) |
(476) |
Reversals |
(83) |
– |
(1) |
(9) |
(255) |
(348) |
Exchange and other movements |
– |
– |
(24) |
(3) |
(25) |
(52) |
At 31 December 2024 |
275 |
105 |
166 |
859 |
785 |
2,190 |
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Due within one year |
1,269 |
1,028 |
722 |
Due after more than one year |
921 |
1,127 |
896 |
Total |
2,190 |
2,155 |
1,618 |
Provisions are often subject to substantial uncertainties with regard to the timing and final amounts of any payments. Once established, these
amounts remain in Provisions even after settlement is reached and uncertainty resolved, with no transfer to Trade and other payables prior
to payment. This is to provide more transparent disclosure of subsequent movements in brought forward and carried forward balances.
Settled legal claims included within Provisions are held at amortised cost with carrying value being a reasonable approximation of fair value.
Severance provisions arise predominantly in connection with global restructuring initiatives, including the PAAGR, which involve rationalisation
of the global supply chain, the sales and marketing organisation, IT and business support infrastructure, and R&D.
In conjunction with the acquisition of Alexion in 2021, the enlarged Group initiated the PAAGR; a global restructuring programme, aimed at
integrating systems, structure and processes, optimising the global footprint and prioritising resource allocations and investments. The Group
has also continued to progress other legacy restructuring programmes.
Employee costs in connection with the initiatives are recognised in severance provisions when a detailed formal plan has been communicated
to those employees affected. Final severance costs are often subject to the completion of the requisite consultations on the areas impacted,
with the majority of the cost expected to be paid within one year. AstraZeneca endeavours to support employees affected by restructuring
initiatives to seek alternative roles within the organisation. Where the employee is successful, any severance provisions will be released.
Details of the Environmental provisions totalling $105m (2023: $112m; 2022: $131m) and ongoing matters are provided in Note 30. These
uncertainties can also cause reversal in previously established provisions once final settlement is reached.
Legal issues are often subject to substantial uncertainties with regard to the timing and final amounts of any payments. A significant proportion
of the total legal provision ($626m (2023: $616m; 2022: $30m) due within one year and $210m (2023: $372m; 2022: $92m) due after more
than one year
1
) relates to matters settled, but not paid, in previous periods; further details are provided in Note 30.
The majority of Employee benefit provisions relate to Executive Deferred Compensation Plans, which include uncertainty over the ultimate
timing and amount of payment to be made to the executives.
Other provisions comprise amounts relating to specific contractual or constructive obligations and disputes. Included within Other provisions
are amounts associated with long-standing product liability settlements that arose prior to the merger of Astra and Zeneca, which given the
nature of the provision, the amounts are expected to be settled over many years; the final settlement values and timings are uncertain. Also
included in Other provisions is an amount of $145m (2023: $163m; 2022: $165m), in relation to third-party liability and other risks
(including
incurred but not yet reported claims); the claims are considered to be uncertain as to timing and amount. Charges to Other provisions in 2024
included $184m (2023: $87m; 2022: $12m) in relation to the PAAGR restructuring programme, which has a closing provision of $80m
(2023: $49m; 2022: $143m), including $58m (2023: $8m; 2022: $95m) held in non-current provisions expected to be settled over time by
2028. In 2022, charges to Other provisions included $301m in relation to termination fees and onerous contracts with contract manufacturing
organisations, the vast majority of which were settled in 2023.
No provision has been released or applied for any purpose other than that for which it was established.
1
The profile of future payments of legal provisions due after one year is as follows: in one to two years $167m (2023
: $180m; 2022: $22m); in two to three years $9m (2023: $159m;
Financial Statements
Notes to the Group Financial Statements
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
184
Background
This section predominantly covers defined benefit arrangements like post-retirement pension and medical plans which make up the vast
bulk of these liabilities. However, it also incorporates other benefits which fall under IAS 19 ‘Employee Benefits’ rules and which require an
actuarial valuation, including but not limited to: lump sum plans, long-service awards and defined contribution pension plans which have
some defined benefit characteristics (e.g. a minimum guaranteed level of benefit). In total, over 50 plans in 28 countries are covered.
The Group and most of its subsidiaries offer post-retirement pension plans which cover the majority of employees. The Group’s policy is to
provide defined contribution (DC) orientated pension provision to its employees unless otherwise compelled by local regulation. As a result,
many of these retirement plans are DC, where the Group contribution and resulting charge is fixed at a set level, or is a set percentage of
employees’ pay. However, several plans, mainly in the UK and Sweden, are defined benefit (DB), where benefits are based on employees’
length of service and salary. The major DB plans are largely legacy arrangements as they have been closed to new entrants since 2000,
apart from the collectively bargained Swedish plan (which is still open to employees born before 1979). During 2010, following consultation
with its UK employees’ representatives, the Group introduced a freeze on pensionable pay at 30 June 2010 levels for DB members of the
UK Pension Fund. The number of active members in the Fund continues to decline and is now 351 employees.
The Group’s DB plans are largely funded through ringfenced, fiduciary-administered assets. The cash funding of the plans, which may from
time to time involve payments from the Group, is designed, in consultation with independent qualified actuaries, to ensure that the assets are
sufficient to meet future obligations as and when they fall due. The funding level is monitored by the Group and local fiduciaries, who may
take into account various factors, including: the strength of the Group’s covenant, local regulation, cash flows, and the solvency and maturity
of the pension plan.
Funding Framework
Eighty six per cent of the Group’s total DB obligations (or 62% of net obligations) at 31 December 2024 are in plans within the UK and Sweden.
The Group has developed a long-term funding framework for such plans which targets either full funding on a low-risk funding measure, or
buyout with an external third-party as the pension plans mature, with pragmatic long-term de-risking of investment strategy along the way.
Unless local regulation dictates otherwise, this framework determines the cash contributions payable.
UK
The UK Pension Fund represents approximately 65% of the Group’s DB obligations at 31 December 2024. The funding framework is modified
in light of the UK regulatory requirements (summarised below) and resulting discussions with the Trustee.
Role of Trustee and Regulation
The UK Pension Fund is governed and administered by a corporate Trustee. The Trustee Directors are comprised of representatives appointed
by both the employer and Fund members and include an independent professional Trustee Director. The Trustee Directors are required by
law to act in the interest of all relevant beneficiaries and are responsible in particular, for investment strategy and the day-to-day administration
of the benefits. They are also responsible for jointly agreeing with the employer the level of contributions required to ensure the funding
objective is met.
The UK pensions industry is regulated by The Pensions Regulator whose statutory objectives and regulatory powers are described on its
website, www.thepensionsregulator.gov.uk.
The Pension Scheme Act 2021 became effective in the UK from 1 October 2021. A section of this Act places additional legal requirements
on companies who sponsor UK defined benefit pension schemes, to monitor and assess corporate activity, with a focus on the potential
impact of such activity on the ongoing security of these benefits. The Group maintains a framework to ensure it meets its responsibilities
under the Act.
There have been two UK High Court Rulings relating to Guaranteed Minimum Pensions (GMP) equalisation in 2018 and 2020. Following the
publication of guidance around implementation in 2021, the Trustee, with input from the Group, has completed the equalisation of benefits
for pensioner members, and a process is in place to equalise non-pensioner members’ benefits at the point of retirement. Further details are
set out later in this Note. An estimate of the impact of these changes has already been recognised in 2018 and 2020, and actual experience
is in line with the estimates previously recognised.
In June 2023, the UK High Court (Virgin Media Limited v NTL Pension Trustees II Limited) ruled that certain historical amendments for
contracted-out defined benefit pension plans were invalid if they were not accompanied by the correct actuarial confirmation. Whilst the
Court of Appeal upheld this ruling in July 2024, there remains material uncertainty in relation to the legal position itself and in particular,
the application of the ruling. The Group has discussed the ruling with the Trustee and its potential implications for the UK Pension Fund.
The Trustee has considered this matter with their legal adviser. Whilst the Trustee has not conducted any detailed investigations at this
point, we note their position that they have no reason to believe that any such confirmations were not provided, in which case the ruling
will have no impact on the UK Pension Fund. The Trustee is monitoring developments as further government guidance and/or case law
emerges and the Group will maintain a dialogue on this matter.
Funding requirements and security
UK legislation requires that an actuarial valuation is completed for all DB pension schemes every three years, which compares the schemes’
liabilities to its assets. As part of the triennial valuation process, the Trustee and the Group must agree on a set of assumptions to value the
liabilities and determine the contributions required, if any, to ensure the UK Pension Fund is fully funded over an appropriate time period and
on a suitably prudent measure. The assumptions used to value the liabilities for the triennial actuarial valuation are required to be prudent,
whereas the assumptions used to prepare an IAS 19 accounting valuation are required to be ‘best estimate’.
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
185
The last full actuarial valuation of the UK Pension Fund was carried out by a qualified actuary as at 31 March 2022 and finalised in May 2023,
ahead of the statutory deadline. The funding assumptions used in this actuarial valuation were set out in the Group’s prior year report. The next
actuarial valuation is due to take place as at 31 March 2025, with a likely timescale for completion in early to mid-2026. The Group is aware
that this actuarial valuation will fall under the Pensions Regulator’s new defined benefit funding code of practice.
Aspects of the triennial actuarial valuation are governed by a long-term funding agreement, effective since October 2016, which sets out a
path to full funding on a low-risk measure. Under this agreement, if a deficit exists, the Group is required to provide security. This security
takes the form of a charge in favour of the Trustee over all land and buildings on the Group’s Cambridge Biomedical Campus site. This charge
was enacted in December 2023, and provides long-term security to the Trustee in respect of the Group’s future deficit recovery contributions.
At the last assessment date (1 December 2023), the value of the charge was £317m ($398m
) and it is capped at £350m ($440m). The value
of the charge will vary and is expected to reduce over time, before falling away. Under the terms of the charge, the Trustee can only exercise
its right over the ownership of the site in a Group insolvency event.
In relation to deficit recovery contributions, a lump sum contribution of £39m ($49m) was made in March 2024, with a further annual contribution
of £39m ($49m) due before 31 March 2025, and each year up to 31 March 2028. Based on 31 December 2024 IAS 19 assumptions, it is
expected that ongoing contributions (excluding past service deficit contributions) during the year ending 31 December 2025 for the UK will
be approximately $18m.
GMP equalisation of member benefits has been completed. The method of equalisation converts GMP to non-GMP pension to simplify the
structure and administration of benefits. As at 31 December 2024, all pensioner and dependent members have had their benefits equalised
and, for non-pensioner members, a process is in place to equalise their benefits at their point of retirement.
Under the governing documentation of the UK Pension Fund, any future surplus in the Fund would be returnable to the Group by refund
assuming gradual settlement of the liabilities over the lifetime of the Fund. In particular, the Trustee has no unilateral right to wind up the
Fund without Company consent nor does it have the power to unilaterally use any surplus to augment benefits prior to wind-up. As such,
there are no adjustments required in respect of ‘IFRIC 14 IAS 19 – The Limit on a Defined Benefit Asset, Minimum Funding Requirements
and their Interaction’.
Sweden
The Swedish plans account for 21% of the Group’s defined benefit obligations. They are governed by Fiduciary Bodies with responsibility
for the investment of the assets. These plans are funded in line with the Group’s long-term funding framework and local regulations.
The Swedish defined benefit pension plans were actuarially valued at 31 December 2023, when plan obligations were estimated to amount
to $1,602m and plan assets were $1,068m. The local Swedish GAAP funding position can influence contribution policy. Over 2024, for the
largest material pension plan, the Group did not request a reimbursement of benefit payments made throughout the year as the funding level
was below 100% on the Swedish GAAP basis and so any such reimbursement is not permitted. These benefit payments over 2024, totalling
approximately $50m, are therefore regarded as Group contributions.
Based on 31 December 2024 IAS 19 assumptions, it is expected that contributions during the year ending 31 December 2025 for Sweden will
be approximately $50m.
US
Following a buy out in May 2023 of the AZ Pharmaceutical LP qualified US Defined Benefit Pension Plan, all remaining US benefit plans which
fall under IAS 19 are now disclosed within the ‘Rest of Group’ category, given the material reduction in aggregate obligation and to therefore
ensure consistency with the Group’s classification methodology.
Other defined benefit plans
The Group provides defined benefit plans other than pensions which are reported under IAS 19. These include lump sum plans, long-service
awards and defined contribution pension plans which have a guaranteed minimum benefit. However, the largest category of these ‘other’
non-pension plans are healthcare benefits.
The cost of post-retirement benefits other than pensions for the Group in 2024 was $1m (2023: $1m; 2022: $1m). Plan assets were $146m
and plan obligations were $105m at 31 December 2024.
Financial assumptions
Qualified independent actuaries have updated the actuarial valuations under IAS 19 for the major defined benefit plans operated by the Group
to 31 December 2024. The assumptions used may not necessarily be borne out in practice, due to the inherent financial and demographic
uncertainty associated with making long-term projections. These assumptions reflect the changes which have the most material impact on
the results of the Group and were as follows:
| 2023 | ||||
UK | US | Sweden | Rest of Group 1 | |
Inflation assumption | 3.1% | – | 1.6% | 2.2% |
Rate of increase in salaries | – 3 | – | 3.1% | 3.7% |
Rate of increase in pensions in payment | 2.9% | – | 1.6% | 2.2% |
Discount rate – defined benefit obligation | 4.6% | 4.7% | 3.3% | 3.3% |
Discount rate – interest cost | 4.6% | 4.7% | 3.3% | 3.3% |
Discount rate – service cost | 4.5% | n/a | 3.3% | 3.3% |
Financial Statements
Notes to the Group Financial Statements
continued
22 Post-retirement pension and other defined benefit schemes
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
186
2024 | |||
UK | Sweden | Rest of Group 1 | |
Inflation assumption | 3.2% 2 | 1.8% | 2.1% |
Rate of increase in salaries | – 3 | 3.3% | 3.6% |
Rate of increase in pensions in payment | 3.0% | 1.8% | 2.1% |
Discount rate – defined benefit obligation 4 | 5.5% | 3.5% | 3.5% |
Discount rate – interest cost 5 | 5.4% | 3.4% | 3.5% |
Discount rate – service cost 5 | 5.5% | 3.5% | 3.5% |
1
Rest of Group reflects the assumptions in Germany as these have the most material impact on the Group.
2
The UK inflation assumption includes an allowance for some UK inflation experience over 2024.
3
Pensionable pay frozen at 30 June 2010 levels following UK fund changes.
4
Group defined benefit obligation as at 31 December 2024 calculated using discount rates based on market conditions as at 31 December 2024.
5
2024 interest costs and service costs calculated using discount rates based on market conditions as at 31 December 2023.
The weighted average duration of the post-retirement scheme obligations is approximately 11 years in the UK, 16 years in Sweden and 13 years
for the Rest of the Group (including Germany).
Demographic assumptions
The mortality assumptions are based on country-specific mortality tables. These are compared to actual experience and adjusted where
sufficient data are available. Additional allowance for future improvements in life expectancy is included for all major plans where there is
credible data to support a continuing trend.
The table below illustrates life expectancy assumptions at age 65 for male and female members retiring in 2024 and male and female members
expected to retire in 2044 (2023: 2023 and 2043 respectively).
Life expectancy assumption for a male member retiring at age 65 | Life expectancy assumption for a female member retiring at age 65 | |||||||
Country | 2024 | 2044 | 2023 | 2043 | 2024 | 2044 | 2023 | 2043 |
UK | 22.1 | 23.1 | 22.1 | 23.1 | 23.7 | 24.8 | 23.7 | 24.8 |
Sweden | 21.8 | 24.1 | 21.8 | 23.6 | 23.9 | 26.3 | 23.9 | 26.0 |
In the UK, the Group adopted the CMI Core 2023 Mortality Projections Model with an addition to initial rates of improvement of 0.5% p.a., core
(7.0) smoothing parameter and a 1% long-term improvement rate. The Group has assumed that 15% of members (2023: 25%) will transfer
out of the defined benefit section of the UK Pension Fund at an average age of 57. No other demographic assumptions have changed since
they were updated in 2022 following the actuarial valuation.
In Sweden, the Group adopted DUS23 (2023: DUS21) as the mortality base table. All other demographic assumptions are unchanged
from 2023.
Risks associated with the Group’s defined benefit pension plans
The UK defined benefit plan accounts for 65% of the Group’s defined benefit obligations and exposes the Group to a number of risks which
the Group monitors and works with the Trustee to mitigate (noting it is the Trustee who has the remit and ultimate decision making powers).
The most significant of which are:
Risk | Description | Mitigation |
1 Asset pricing | The Defined Benefit Obligation (DBO) is calculated using a discount | The Trustee invests in a suitably diversified range of asset classes |
rate set with reference to AA-rated corporate bond yields; asset | with different return drivers and investment managers. Investment | |
returns that differ from the discount rate will create an element of | strategy will evolve to further improve the expected risk/return | |
volatility in the solvency ratio. Approximately 44% of the UK Pension | profile as opportunities arise and funding solvency improves. | |
Fund is exposed to growth assets, including global investments, | ||
| most of which are not sterling dominated. Although these growth | The Trustee has hedged approximately 89% of unintended non- | |
| assets are expected to outperform AA-rated corporate bonds in | sterling, overseas currency risk within the UK Pension Fund assets. | |
the long term, they can lead to volatility and mismatching risk in the | ||
short term. The allocation to growth assets is monitored to ensure | ||
it remains appropriate given the UK Pension Fund’s long-term | ||
objectives and risk budget. | ||
2 Interest rate | A decrease in corporate bond yields will increase the present | The interest rate hedge of the UK Pension Fund is predominantly |
value placed on the DBO under IAS 19. | implemented via holding gilts (and gilt repurchase agreements or | |
‘gilt repo’) of appropriate duration. This hedge protects to a large | ||
degree against falls in long-term interest rates and the UK Pension | ||
Fund is approximately 98% hedged as a percentage of assets at the | ||
end of 2024 (versus target of 100%). Nonetheless, there remain | ||
differences in the bonds and instruments held by the UK Pension Fund | ||
to hedge interest rate risk on the statutory and long-term funding basis | ||
(gilts and ‘gilt repo’) and the bonds included in the yield curve to set the | ||
DBO discount rate on an IAS 19 basis (AA corporate bonds). As such, | ||
there remains mismatching risk on an IAS 19 basis should yields on | ||
gilts diverge compared to AA corporate bonds. |
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
187
Risk | Description | Mitigation |
3 Inflation | The majority of the DBO is indexed in line with price inflation | The UK Pension Fund holds RPI index-linked gilts and ‘gilt repo’. |
(mainly inflation as measured by the UK Retail Price Index (RPI) | The inflation hedge of the UK Pension Fund protects to some | |
but also for some members, a component of pensions is indexed | degree against higher-than-expected inflation increases on the | |
by the UK Consumer Price Index (CPI)) and higher inflation will | DBO and is approximately 98% hedged as a percentage of assets at | |
lead to higher liabilities (although, in the vast majority of cases, | the end of 2024 (versus a target of 100%). | |
this is capped at an annual increase of 5%, known as Limited | ||
Price Indexation or LPI). | ||
4 Longevity | The majority of the UK Pension Fund’s obligations are to provide | In 2013, the Trustee entered into a longevity swap to hedge against |
benefits for the life of the member, so increases in life expectancy | the risk of increasing life expectancy over the next circa 70 years. | |
will result in an increase in the liabilities. | The swap currently covers approximately 8,000 of the UK Pension | |
Fund’s pensioners, equivalent to $2.2bn of Pension Fund liability. | ||
A one-year increase in life expectancy would result in a $178m increase | ||
in Pension Fund obligations, which would be partially offset by a $89m | ||
increase in the value of the longevity swap and hence the pension | ||
fund assets. | ||
5 Cash flow | The UK Pension Fund is maturing and cash flow negative. Assets | The Trustee invests in a diversified portfolio of highly liquid assets |
and liquidity | are liquidated to meet benefit outgo and potentially from time to | to manage sequencing risk and operates a collateral management |
time, to supplement the collateral pool required to post margin | policy, maintaining a minimum liquidity ‘buffer’. As at the end of 2024, | |
for derivative holdings. | the buffer is well above recommended regulatory guidelines and | |
the minimum thresholds, and can be quickly supplemented in | ||
| There is a risk of the Trustee requesting liquidity support from | an orderly manner. | |
the Group to meet margin calls or expenditure, if the liquidity | ||
position of the UK Pension Fund is not effectively monitored | At 31 December 2024, 8% of assets are invested in a cash-flow driven | |
and managed. | investment portfolio, consisting of investment-grade corporate bonds. | |
The purpose of this portfolio is to generate income to help meet the | ||
Fund’s benefit outgo. The portfolio is expected to grow over time as | ||
further de-risking occurs and when attractive pricing points present. |
Other risks
There are a number of other risks of administering the UK Pension Fund which the Trustee manages with Group input. Some of the major
risks include counterparty risks from using derivatives (mitigated by using a specialist investment manager to oversee a diversified range of
counterparties of high standing and ensuring positions are collateralised daily). Furthermore, there are operational risks (such as paying out
the wrong benefits) and regulatory risks (such as the UK Government introducing new legislation). These are mitigated so far as possible via
the governance structure in place which oversees and administers the Pension Funds.
Fiduciary Boards who govern the Swedish pension plans also monitor and manage these key risks, where relevant and possible to do so,
in a similar way, by investing in a diversified manner (to mitigate the first risk) and employing a framework to hedge interest rate risk where
practicable (to mitigate the second risk). It is not possible to hedge inflation risk (third risk) nor longevity risk (fourth risk) due to a lack of
available instruments in the local market. As the Swedish plans are less mature and have a longer investment horizon, the fifth risk is not
as significant compared to the UK Pension Fund.
Fiduciary boards are aware of Environmental, Social and Governance (ESG) risks as they pertain to investment policy, and where local
regulation allows, have policies in place to monitor and manage such risks and comply with local legislation and disclosure requirements.
Assets and obligations of defined benefit plans
The assets and obligations of the defined benefit schemes operated by the Group at 31 December 2024, as calculated in accordance with
IAS 19, are shown below. The fair values of the schemes’ assets are not intended to be realised in the short term and may be subject to
significant change before they are realised. The present value of the schemes’ obligations is derived from cash-flow projections over long
periods and is therefore inherently uncertain.
Scheme assets
2023 | |||||||||||
UK | US | Sweden | Rest of Group | Total | |||||||
Quoted | Unquoted | Quoted | Unquoted | Quoted | Unquoted | Quoted | Unquoted | Quoted | Unquoted | Total | |
$m | $m | $m | $m | $m | $m | $m | $m | $m | $m | $m | |
Government bonds 1 | 2,383 | – | 61 | – | – | – | 51 | – | 2,495 | – | 2,495 |
Corporate bonds 2 | 373 | – | 94 | – | – | – | 6 | – | 473 | – | 473 |
Derivatives 3 | – | (532) | – | – | – | 440 | – | – | – | (92) | (92) |
Investment funds: Listed Equities 4 | – | 321 | – | – | – | – | 53 | 3 | 53 | 324 | 377 |
Investment funds: Absolute Return/ | |||||||||||
Multi Strategy 4 | – | 1,131 | – | – | – | 461 | 5 | 8 | 5 | 1,600 | 1,605 |
Investment funds: Corporate Bonds/Credit 4 | – | 667 | – | – | – | 165 | 48 | – | 48 | 832 | 880 |
Cash and cash equivalents | 53 | 363 | 5 | – | – | 2 | – | 3 | 58 | 368 | 426 |
Other | – | – | – | – | – | – | (1) | 316 | (1) | 316 | 315 |
Total fair value of scheme assets 5 | 2,809 | 1,950 | 160 | – | – | 1,068 | 162 | 330 | 3,131 | 3,348 | 6,479 |
Financial Statements
Notes to the Group Financial Statements
continued
22 Post-retirement pension and other defined benefit schemes
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
188
2024 | |||||||||
UK | Sweden | Rest of Group | Total | ||||||
Quoted | Unquoted | Quoted | Unquoted | Quoted | Unquoted | Quoted | Unquoted | Total | |
$m | $m | $m | $m | $m | $m | $m | $m | $m | |
Government bonds 1 | 1,884 | – | – | – | 45 | – | 1,929 | – | 1,929 |
Corporate bonds 2 | 352 | – | – | – | 6 | – | 358 | – | 358 |
Derivatives 3 | – | (355) | – | 475 | – | – | – | 120 | 120 |
Investment funds: Listed Equities 4 | – | 374 | – | – | 38 | 23 | 38 | 397 | 435 |
Investment funds: Absolute Return/Multi Strategy 4 | – | 1,051 | – | 420 | 5 | 7 | 5 | 1,478 | 1,483 |
Investment funds: Corporate Bonds/Credit 4 | – | 601 | – | 159 | 182 | 19 | 182 | 779 | 961 |
Cash and cash equivalents | 32 | 336 | – | 2 | 2 | 2 | 34 | 340 | 374 |
Other | – | – | – | – | (6) | 194 | (6) | 194 | 188 |
Total fair value of scheme assets 5 | 2,268 | 2,007 | – | 1,056 | 272 | 245 | 2,540 | 3,308 | 5,848 |
1
Predominantly developed markets in nature.
2
Predominantly developed markets in nature and investment grade (AAA-BBB).
3
Includes interest rate swaps, inflation swaps, longevity swaps, equity total return swaps and other contracts. More detail is given in the section Risks associated with the Group’s defined
benefit pension plans on page 186. Valuations are determined by independent third parties.
4
Investment Funds are pooled, commingled vehicles, whereby the pension plan owns units in the fund, alongside other investors. The pension plans invest in a number of Investment
Funds, including Listed Equities (primarily developed markets with some emerging markets), Corporate Bonds/Credit (a range of investment-grade and non investment-grade credit)
and Absolute Return/Multi Strategy (actively managed multi-asset exposure both across and within traditional and alternative asset classes). The price of the funds is set by independent
administrators/custodians employed by the investment managers and based on the value of the underlying assets held in the fund. Details of pricing methodology is set out within
internal control reports provided for each fund. Prices are updated daily, weekly or monthly depending upon the frequency of the fund’s dealing.
5
None of the Group’s own assets were included in the scheme assets (2023: $nil).
Scheme obligations | |||||
2023 | |||||
UK | US | Sweden | Rest of Group | Total | |
$m | $m | $m | $m | $m | |
Present value of scheme obligations in respect of: | |||||
Active membership | (233) | (45) | (553) | (442) | (1,273) |
Deferred membership | (853) | (2) | (443) | (294) | (1,592) |
Pensioners | (4,075) | (107) | (606) | (254) | (5,042) |
Total value of scheme obligations | (5,161) | (154) | (1,602) | (990) | (7,907) |
| 2024 | ||||
UK | Sweden | Rest of Group | Total | |
$m | $m | $m | $m | |
Present value of scheme obligations in respect of: | ||||
Active membership | (200) | (543) | (481) | (1,224) |
Deferred membership | (667) | (393) | (197) | (1,257) |
Pensioners | (3,725) | (572) | (301) | (4,598) |
Total value of scheme obligations | (4,592) | (1,508) | (979) | (7,079) |
Net (deficit)/surplus in the scheme | |||||
2023 | |||||
UK | US | Sweden | Rest of Group | Total | |
$m | $m | $m | $m | $m | |
Total fair value of scheme assets | 4,759 | 160 | 1,068 | 492 | 6,479 |
Total value of scheme obligations | (5,161) | (154) | (1,602) | (990) | (7,907) |
(Deficit)/surplus in the scheme as recognised in the | |||||
Consolidated Statement of Financial Position | (402) | 6 | (534) | (498) | (1,428) |
Included in Non-current other receivables (Note 14) | – | 66 | – | 26 1 | 92 |
Included in Retirement benefit obligations | (402) | (60) | (534) | (524) | (1,520) |
(402) | 6 | (534) | (498) | (1,428) |
| 2024 | ||||
UK | Sweden | Rest of Group | Total | |
$m | $m | $m | $m | |
Total fair value of scheme assets | 4,275 | 1,056 | 517 | 5,848 |
Total value of scheme obligations | (4,592) | (1,508) | (979) | (7,079) |
Deficit in the scheme as recognised in the | ||||
Consolidated Statement of Financial Position | (317) | (452) | (462) | (1,231) |
Included in Non-current other receivables (Note 14) | – | – | 99 2 | 99 |
Included in Retirement benefit obligations | (317) | (452) | (561) | (1,330) |
(317) | (452) | (462) | (1,231) | |
1
Surpluses were recognised in Ireland and Belgium.
2
Surpluses were recognised in the US, Ireland and Belgium.
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
189
Fair value of scheme assets | |||||||||
2024 | 2023 | ||||||||
UK | Sweden | Rest of Group | Total | UK | US | Sweden | Rest of Group | Total | |
$m | $m | $m | $m | $m | $m | $m | $m | $m | |
At beginning of year | 4,759 | 1,068 | 652 | 6,479 | 4,573 | 1,008 | 946 | 503 | 7,030 |
Interest income on scheme assets | 214 | 33 | 15 | 262 | 229 | 22 | 38 | 11 | 300 |
Expenses | (5) | – | – | (5) | (9) | (1) | – | (1) | (11) |
Actuarial (losses)/gains | (370) | 55 | – | (315) | (59) | 2 | 37 | (45) | (65) |
Exchange and other adjustments | (67) | (98) | (20) | (185) | 262 | (1) | 48 | 20 | 329 |
Employer contributions | 66 | 50 | 50 | 166 | 65 | 35 | 46 | 42 | 188 |
Participant contributions | 1 | – | 12 | 13 | 1 | 4 | – | 7 | 12 |
Benefits paid | (323) | (52) | (76) | (451) | (303) | (68) | (47) | (45) | (463) |
Settlements 1 | – | – | (116) | (116) | – | (841) | – | – | (841) |
Scheme assets’ fair value at end of year | 4,275 | 1,056 | 517 | 5,848 | 4,759 | 160 | 1,068 | 492 | 6,479 |
1
The 2024 settlement is the buyout of post-retirement pension plans in Norway and the Netherlands.
The actual return on the plan assets was a loss of $53m (2023: gain of $235m).
Movement in post-retirement scheme obligations | |||||||||
2024 | 2023 | ||||||||
UK | Sweden | Rest of Group | Total | UK | US | Sweden | Rest of Group | Total | |
$m | $m | $m | $m | $m | $m | $m | $m | $m | |
Present value of obligations in | |||||||||
scheme at beginning of year | (5,161) | (1,602) | (1,144) | (7,907) | (4,801) | (1,022) | (1,312) | (973) | (8,108) |
Current service cost | (6) | (26) | (40) | (72) | (6) | (2) | (13) | (35) | (56) |
Past service (cost)/credit | (2) | (8) | 1 | (9) | 12 | – | (2) | 2 | 12 |
Participant contributions | (1) | – | (12) | (13) | (1) | (4) | – | (7) | (12) |
Benefits paid | 323 | 52 | 76 | 451 | 303 | 68 | 47 | 45 | 463 |
Interest expense on post-retirement | |||||||||
scheme obligations | (231) | (47) | (34) | (312) | (239) | (22) | (50) | (27) | (338) |
Actuarial gains/(losses) | 416 | (23) | 2 | 395 | (155) | (12) | (202) | 28 | (341) |
Exchange and other adjustments | 70 | 146 | 56 | 272 | (274) | 1 | (70) | (34) | (377) |
Settlements 1 | – | – | 116 | 116 | – | 839 | – | 11 | 850 |
Present value of obligations in | |||||||||
scheme at end of year | (4,592) | (1,508) | (979) | (7,079) | (5,161) | (154) | (1,602) | (990) | (7,907) |
1
The 2024 settlement is the buyout of post-retirement pension plans in Norway and the Netherlands.
The obligations arise from over 50 plans in 28 countries:
2024 | 2023 | ||||||||
UK | Sweden | Rest of Group | Total | UK | US | Sweden | Rest of Group | Total | |
$m | $m | $m | $m | $m | $m | $m | $m | $m | |
Funded – pension schemes 1 | (4,582) | (1,505) | (717) | (6,804) | (5,151) | – | (1,599) | (868) | (7,618) |
Funded – post-retirement healthcare | – | – | (78) | (78) | – | (94) | – | – | (94) |
Unfunded – pension schemes 1 | – | (3) | (167) | (170) | – | (60) | (3) | (113) | (176) |
Unfunded – post-retirement healthcare | (10) | – | (17) | (27) | (10) | – | – | (9) | (19) |
Total | (4,592) | (1,508) | (979) | (7,079) | (5,161) | (154) | (1,602) | (990) | (7,907) |
1
Includes defined benefit pension schemes and other plans, such as lump sum, long service awards and DC plans with underpins.
Financial Statements
Notes to the Group Financial Statements
continued
22 Post-retirement pension and other defined benefit schemes
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
190
Consolidated Statement of Comprehensive Income disclosures
The amounts that have been charged to the Consolidated Statement of Comprehensive Income, in respect of defined benefit schemes for
the years ended 31 December 2024 and 31 December 2023, are set out below.
| 2024 | 2023 | ||||||||
UK | Sweden | Rest of Group | Total | UK | US | Sweden | Rest of Group | Total | |
$m | $m | $m | $m | $m | $m | $m | $m | $m | |
Operating profit | |||||||||
Current service cost | (6) | (26) | (40) | (72) | (6) | (2) | (13) | (35) | (56) |
Past service (cost)/credit | (2) | (8) | 1 | (9) | 12 | – | (2) | 2 | 12 |
Expenses | (5) | – | – | (5) | (9) | (1) | – | (1) | (11) |
Total charge to Operating profit | (13) | (34) | (39) | (86) | (3) | (3) | (15) | (34) | (55) |
Finance expense | |||||||||
Interest income on scheme assets | 214 | 33 | 15 | 262 | 229 | 22 | 38 | 11 | 300 |
Interest expense on post-retirement | |||||||||
scheme obligations | (231) | (47) | (34) | (312) | (239) | (22) | (50) | (27) | (338) |
Net interest on post-employment | |||||||||
defined benefit plan liabilities | (17) | (14) | (19) | (50) | (10) | – | (12) | (16) | (38) |
Charge before taxation | (30) | (48) | (58) | (136) | (13) | (3) | (27) | (50) | (93) |
Other comprehensive income | |||||||||
Difference between the actual return | |||||||||
and the expected return on the post- | |||||||||
retirement scheme assets | (370) | 55 | – | (315) | (59) | 2 | 37 | (45) | (65) |
Experience gains/(losses) arising on the | |||||||||
post-retirement scheme obligations | 3 | (33) | (10) | (40) | (25) | (2) | (67) | (13) | (107) |
Changes in financial assumptions | |||||||||
underlying the present value of the | |||||||||
post-retirement scheme obligations | 414 | 11 | 11 | 436 | (142) | (10) | (135) | 44 | (243) |
Changes in demographic assumptions | (1) | (1) | 1 | (1) | 12 | – | – | (3) | 9 |
Remeasurement of the | |||||||||
defined benefit liability | 46 | 32 | 2 | 80 | (214) | (10) | (165) | (17) | (406) |
Past service cost includes granting early retirement in UK and Sweden.
Total Group pension costs in respect of defined contribution and defined benefit schemes during the year are set out below (see Note 29).
2024 | 2023 | |
$m | $m | |
Defined contribution plans | 528 | 482 |
Defined benefit plans − Current service cost and Expenses | 77 | 67 |
Defined benefit plans − Past service cost/(credit) | 9 | (12) |
Pension costs | 614 | 537 |
SE
Rate sensitivities
The following tables show the US dollar effect of a change in the significant actuarial assumptions used to determine the retirement benefits
obligations in our two main defined benefit pension obligation countries.
| 2024 | 2023 | |||
+0.5% | −0.5% | +0.5% | −0.5% | |
Discount rate | ||||
UK ($m) | 219 | (239) | 269 | (308) |
Sweden ($m) | 110 | (126) | 109 | (123) |
Total ($m) | 329 | (365) | 378 | (431) |
| 2024 | 2023 | |||
+0.5% | −0.5% | +0.5% | −0.5% | |
Inflation rate 1 | ||||
UK ($m) | (148) | 142 | (189) | 184 |
Sweden ($m) | (119) | 104 | (116) | 104 |
Total ($m) | (267) | 246 | (305) | 288 |
| 2024 | 2023 | |||
+0.5% | −0.5% | +0.5% | −0.5% | |
Rate of increase in salaries | ||||
UK ($m) | n/a | n/a | n/a | n/a |
Sweden ($m) | (46) | 43 | (46) | 42 |
Total ($m) | (46) | 43 | (46) | 42 |
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
191
| 2024 |
2023 |
|||
+1 year |
−1 year |
+1 year |
−1 year |
|
Mortality rate |
||||
UK ($m) |
(178) 2 |
175 3 |
(214) |
212 |
Sweden ($m) |
(74) |
54 |
(51) |
51 |
Total ($m) |
(252) |
229 |
(265) |
263 |
1
Rate of increase in pensions in payment follows inflation.
2
Of the $178m increase, $89m is covered by the longevity swap.
3
Of the $175m decrease, $88m is covered by the longevity swap.
Due to market conditions at 31 December 2023 the following additional sensitivities for 1.0% assumption changes were calculated and
disclosed in the 2023 Group Financial Statements: $525m (UK) and $210m (Sweden
) if the discount rate is increased; $(634)m (UK
) and
$(254)m (Sweden) if the discount rate is decreased; $(384)m (UK
) and $(240
)m (Sweden) if the inflation rate is increased; and $363m (UK
)
and $201m (Sweden) if the inflation rate is decreased. The Group does not consider market conditions at 31 December 2024 warrant the
updating of these sensitivities.
The sensitivity to the financial assumptions shown above has been estimated taking into account the approximate duration of the liabilities
and the overall profile of the plan membership.
The inflation sensitivity allows for the impact of a change in inflation on salary increases and pension increases (where these assumptions
are inflation-linked).
The salary increase sensitivity reflects the impact of an increase of only salary relative to inflation.
The sensitivity to the life expectancy assumption is estimated based on a revised mortality assumption that extends/reduces the current life
Retained earnings
The cumulative amount of goodwill written off directly to reserves resulting from acquisitions, net of disposals, amounted to $580m
(2023: $595m; 2022: $591m) using year-end rates of exchange.
At 31 December 2024, 442,342 shares, at a cost of $68m, have been deducted from Retained earnings (2023: 1,580,137 shares, at a cost of
$129m; 2022: 1,671,446 shares, at a cost of $112m) to satisfy future vesting of employee share plans.
There are no significant statutory or contractual restrictions on the distribution of current profits of subsidiaries; undistributed profits of prior
years are, in the main, permanently employed in the businesses of these companies. The undistributed income of AstraZeneca companies
overseas might be liable to overseas taxes and/or UK taxation (after allowing for double taxation relief) if they were to be distributed as
dividends (see Note 4).
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Cumulative translation differences included within Retained earnings |
|||
At 1 January |
(3,014) |
(3,694) |
(1,934) |
Foreign exchange arising on consolidation |
(957) |
608 |
(1,446) |
Exchange adjustments on goodwill (recorded against other reserves) |
(15) |
4 |
(24) |
Foreign exchange arising on designated liabilities in net investment hedges 1 |
(122) |
24 |
(282) |
Fair value movements on derivatives designated in net investment hedges |
39 |
44 |
(8) |
Net exchange movement in Retained earnings |
(1,055) |
680 |
(1,760) |
At 31 December |
(4,069) |
(3,014) |
(3,694) |
1
Foreign exchange arising on designated liabilities in net investment hedges includes $59m in respect of designated bonds and $(181)m in respect of designated contingent consideration
and other liabilities. The change in value of designated contingent consideration liabilities relates to $(180)m in respect of BMS’ share of Global Diabetes Alliance.
The cumulative loss with respect to costs of hedging is $43m (2023: $22m; 2022: $3m) and the loss during the year was $21m (2023: $19m;
2022: $7m).
The balance remaining in the foreign currency translation reserve from net investment hedging relationships for which hedge accounting no
longer applied is a gain of $527m. For further detail relating to hedging balances, please see the Hedge accounting section within Note 28,
from page 199.
Other reserves
The other reserves arose from the cancellation of £1,255m of share premium account by the Company in 1993 and the redenomination of
share capital of $157m in 1999. The reserves are available for writing off goodwill arising on consolidation and, subject to guarantees given
to preserve creditors at the date of the court order, are available for distribution.
Following an amendment to the Employee Benefit Trust (EBT) Deed on 10 June 2024, AstraZeneca obtained control and commenced
Financial Statements
Notes to the Group Financial Statements
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
192
| Allotted, called-up and fully paid | |||
2024 | 2023 | 2022 | |
$m | $m | $m | |
Issued Ordinary Shares ($0.25 each) | 388 | 388 | 387 |
Redeemable Preference Shares (£1 each – £50,000) | – | – | – |
At 31 December | 388 | 388 | 387 |
The Redeemable Preference Shares carry limited class-voting rights and no dividend rights. This class of shares is capable of redemption at
par at the option of the Company on the giving of seven days’ written notice to the registered holder of the shares.
The Company does not have a limited amount of authorised share capital.
The movements in the number of Ordinary Shares during the year can be summarised as follows:
| No. of shares | |||
2024 | 2023 | 2022 | |
At 1 January | 1,550,162,626 | 1,549,800,030 | 1,549,400,665 |
Issue of shares (share schemes) | 383,613 | 362,596 | 399,365 |
At 31 December | 1,550,546,239 | 1,550,162,626 | 1,549,800,030 |
Share issues
Issue of shares (share schemes) represents share capital issued as part of the Group’s equity incentivisation schemes (see Note 29
).
Share repurchases
No Ordinary Shares were repurchased by the Company in 2024 (2023: nil; 2022: nil).
Shares held by subsidiaries
At 31 December 2024, AstraZeneca-controlled Employee Benefit Trust arrangements held 442,342 Ordinary Shares in the Company at a
weighted average cost of $68m. The market value of these Ordinary Shares at 31 December 2024 was $58m. No comparable arrangements
2024 | 2023 | 2022 | 2024 | 2023 | 2022 | |
Per share | Per share | Per share | $m | $m | $m | |
Second interim (March 2024) | $1.97 | $1.97 | $1.97 | 3,052 | 3,047 | 3,046 |
First interim (September 2024) | $1.00 | $0.93 | $0.93 | 1,550 | 1,440 | 1,440 |
Total | $2.97 | $2.90 | $2.90 | 4,602 | 4,487 | 4,486 |
The Company has exercised its authority in accordance with the provisions set out in the Company’s Articles of Association, that the balance
of unclaimed dividends outstanding past 12 years be forfeited. Unclaimed dividends of $nil (2023: $nil; 2022: $1m) have been adjusted for in
Retained earnings in 2024.
The 2023 second interim dividend of $1.97 per share was paid on 25 March 2024. The 2024 first interim dividend of $1.00 per share was paid
on 9 September 2024.
Reconciliation of dividends charged to equity to the Consolidated Statement of Cash Flows:
2024 | 2023 | 2022 | |
$m | $m | $m | |
Dividends charged to equity | 4,602 | 4,487 | 4,486 |
Exchange losses on payment of dividend | 3 | 5 | 5 |
Hedge contracts relating to payment of dividends (Consolidated Statement of Cash Flows) | 16 | (19) | (127) |
Dividends paid to non-controlling interests | 4 | 4 | – |
Net movement of unclaimed dividends in the year | 4 | 4 | – |
Dividends paid (Consolidated Statement of Cash Flows) | 4,629 | 4,481 | 4,364 |
The Group Financial Statements at 31 December 2024 reflect equity of $85m (2023: $23m; 2022: $21m) and Total comprehensive income of
$5m (2023: $6m; 2022: $2m) attributable to the non-controlling interests in AstraZeneca Pharma India Limited, P.T. AstraZeneca Indonesia,
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
193
Acquisitions of business operations in 2024
Gracell
On 22 February 2024, AstraZeneca completed the acquisition of Gracell Biotechnologies Inc. (Gracell), a global clinical-stage biopharmaceutical
company developing innovative cell therapies for the treatment of cancer and autoimmune-diseases. Gracell will operate as a wholly-owned
subsidiary of AstraZeneca, with operations in China and the US.
The acquisition enriches AstraZeneca’s growing pipeline of cell therapies with AZD0120 (formerly GC012F), a novel, clinical-stage T-cell
(CAR-T: therapeutic chimeric antigen receptor) therapy. AZD0120 is a potential new treatment for multiple myeloma, as well as other
haematologic malignancies and autoimmune-diseases, including Systemic Lupus Erythematosus (SLE).
The transaction is recorded as a business combination using the acquisition method of accounting in accordance with IFRS 3 ‘Business
Combinations’. Consequently, the assets acquired, and liabilities assumed are recorded at fair value. The purchase price allocation review
has been completed.
Fair value |
|
$m |
|
Intangible assets |
1,038 |
Cash and cash equivalents 1 |
212 |
Net deferred tax liability |
(260) |
Other immaterial net balances |
(89) |
Total net assets acquired |
901 |
Goodwill |
136 |
Consideration |
1,037 |
1
Cash and cash equivalents acquired includes $3m relating to marketable securities.
The total consideration fair value of $1,037m comprises cash consideration of $983m and future regulatory milestone-based consideration
of $54m. Intangible assets recognised relate to products in development, principally AZD0120, and were fair valued using the multi-period
excess earnings method, which uses several estimates regarding the amount and timing of future cash flows. The key assumptions in the
cash flows are the probability of technical and regulatory success, peak year sales and revenue erosion profiles.
The net deferred tax liability of $260m principally arises from the deferred tax impact of the uplift in fair value of intangible assets.
Goodwill of $136m has been recognised, which principally comprises the premium attributable to the core technological capabilities and
knowledge base of the company. Goodwill is not expected to be deductible for tax purposes.
Gracell’s results have been consolidated into the Group’s results from 22 February 2024.
Fusion
On 4 June 2024, AstraZeneca completed the acquisition of Fusion Pharmaceuticals Inc., (Fusion) a clinical-stage biopharmaceutical company
developing next-generation radioconjugates. The acquisition marks a major step forward in AstraZeneca delivering on its ambition to transform
cancer treatment and outcomes for patients by replacing traditional regimens like chemotherapy and radiotherapy with more targeted
treatments. As a result of the acquisition, Fusion became a wholly owned subsidiary of AstraZeneca, with operations in Canada and the US.
Immediately prior to the acquisition, AstraZeneca held approximately 1% shareholding in Fusion considered to have a fair value of $24m.
This acquisition complements AstraZeneca’s leading oncology portfolio with the addition of the Fusion pipeline of radioconjugates, including
their most advanced programme, FPI-2265, a potential new treatment for patients with metastatic castration
-resistant prostate cancer (mCRPC),
and brings new expertise and pioneering R&D, manufacturing and supply chain capabilities in actinium-based radioconjugates to AstraZeneca.
The transaction is recorded as a business combination using the acquisition method of accounting in accordance with IFRS 3 ‘Business
Combinations’. Consequently, the assets acquired, and liabilities assumed are recorded at fair value. The purchase price allocation review
has been completed.
Fair value |
|
$m |
|
Intangible assets |
1,326 |
Cash and cash equivalents |
30 |
Current investments |
87 |
Net deferred tax liability |
(246) |
Other immaterial net balances |
51 |
Total net assets acquired |
1,248 |
Goodwill |
947 |
Consideration |
2,195 |
The total consideration fair value of $2,195m includes cash consideration of $2,027m (net of $24m proceeds from disposal of the existing
approximately 1% shareholding) and future regulatory milestone-based consideration of $144m. Intangible assets relating to products in
development comprise the FPI-2265 ($848m), FPI-2059 ($165m) and AZD2068 ($313m) programmes. These were fair valued using the
multi-period excess earnings method, which uses several estimates regarding the amount and timing of future cash flows. The key assumptions
in the cash flows are the probability of technical and regulatory success, peak year sales and revenue erosion profiles.
Financial Statements
Notes to the Group Financial Statements
continued
27 Acquisition of business operations
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
194
The net deferred tax liability of $246m principally arises from the deferred tax impact of the uplift in fair value of intangible assets.
Goodwill amounting to $947m was recognised on acquisition and is underpinned by a number of elements, which individually could not be
quantified. These include the premium attributable to a pre-existing, well positioned business in the innovation intensive biopharmaceuticals
market with a highly skilled workforce, unidentified potential products that future research and development may yield, and the core capabilities
and knowledge base of the company including radioisotope supply and manufacturing expertise. Goodwill is not expected to be deductible
for tax purposes.
Fusion’s results have been consolidated into the Group’s results from 4 June 2024.
In December 2024, the intangible asset relating to product in development FPI-2059 was fully impaired by $165m due to decisions made to
terminate the related activities and prioritise resources on the development of FPI-2265 and AZD2068 (see Note 10).
Acquisitions of business operations in 2023
On 16 January 2023, AstraZeneca completed the acquisition of Neogene Therapeutics Inc. (Neogene), a global clinical-stage biotechnology
company pioneering the discovery, development and manufacturing of next-generation T-cell receptor therapies (TCR
-Ts). The total consideration
was $267m. Intangible assets of $100m and goodwill of $158m were recognised in the acquisition balance sheet, as well as a cash outflow
of $189m, net of cash acquired. Following achievement of agreed milestones in 2024, contingent milestones-based consideration and non-
contingent consideration of $120m is payable. Neogene’s results have been consolidated into the Group’s results from 16 January 2023.
Acquisitions of business operations in 2022
On 16 November 2022, AstraZeneca completed the acquisition of 100% of the issued shares of LogicBio Therapeutics, Inc. (LogicBio) based
in Lexington, MA, US. LogicBio is a clinical-stage genetic medicine company pioneering genome editing and gene delivery platforms to
address rare and serious diseases from infancy through adulthood. The total consideration was $72m. Cash of $68m was paid on the
completion date, with $4m of outstanding options, which will be settled in cash, recorded in current Trade and other payables. Goodwill of
$15m, assets of $82m, including $46m of intangible assets, and liabilities of $25m were recognised on acquisition. LogicBio’s results have
The Group’s principal financial instruments, other than derivatives, comprise bank overdrafts, loans and other borrowings, lease liabilities,
current and non-current investments, cash and short-term deposits. The main purpose of these financial instruments is to manage the
Group’s funding and liquidity requirements. The Group has other financial assets and liabilities such as trade receivables and trade payables,
which arise directly from its operations.
The principal financial risks to which the Group is exposed are those of liquidity, interest rate, foreign currency and credit. Each of these is
managed in accordance with Board-approved policies. These policies, together with the Group’s approach to capital management, are set
out below.
Capital management
The capital structure of the Group consists of Shareholders’ equity (Note 24), Debt (Note 19), Other current investments (Note 12) and Cash
(Note 17). For the foreseeable future, the Board will maintain a capital structure that supports the Group’s strategic objectives through:
•
managing funding and liquidity risk
•
optimising shareholder return
•
maintaining a strong, investment-grade credit rating.
The Group utilises factoring arrangements and bank acceptance drafts discounting for selected trade receivables. These arrangements qualify
for full derecognition of the associated trade receivables under IFRS 9 ‘Financial Instruments’. Amounts due on invoices that have not been
factored at year end, from customers that are subject to these arrangements, are disclosed in Note 16.
Funding and liquidity risk are reviewed regularly by the Board and managed in accordance with the policies described below.
The Board regularly reviews its shareholders’ distribution policy, which comprises a regular cash dividend and potentially a share repurchase
component. No share repurchases have been made since 2012.
The Group’s net debt position (loans and borrowings net of Cash and cash equivalents, Other investments and Derivative financial instruments)
has increased by $2,060m from a net debt position of $22,510m at the beginning of the year to a net debt position of $24,570m at 31 December
2024. Gross debt increased from $28,622m to $30,295m, principally due to the issuance of $6,492m debt offset by the repayment of
$4,652m debt.
The Board reviews the Group’s ongoing liquidity risks annually as part of the planning process and on an ad hoc basis. The Board considers
short-term requirements against available sources of funding, taking into account forecast cash flows. The Group manages liquidity risk by
maintaining access to a number of sources of funding which are sufficient to meet anticipated funding requirements. Specifically, the Group
uses US and European commercial paper, bank loans, committed bank facilities and cash resources to manage short-term liquidity and
manages long-term liquidity by raising funds through the capital markets. At 31 December 2024, the Group was assigned short-term credit
ratings of P-1 by Moody’s and A-1 by Standard and Poor’s. The Group’s long
-term credit rating was A2 by Moody’s and A+ by Standard
and Poor’s.
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
195
In addition to Cash and cash equivalents of $5,488m, short-term fixed income investments of $37m, less overdrafts of $59m at 31 December
2024, the Group has committed bank facilities of $4,875m available to manage liquidity. These committed bank facilities have no financial
covenants. The maturity of the $4,875m facilities was extended in January 2025 from April 2029 to April 2030. The Group regularly monitors
the credit standing of the banks providing the facilities and currently does not anticipate any issue with drawing on the committed facilities
should this be necessary. Advances under these facilities currently bear an interest rate per annum based on Secured Overnight Financing
Rate (SOFR) plus a margin.
At 31 December 2024, the Group has $5,122m outstanding from debt issued under a Euro Medium Term Note programme and $23,350m
under an SEC-registered programme. The funds made available under these facility agreements may be used for the general corporate
purposes of the Group.
The maturity profile of the anticipated future contractual cash flows including interest in relation to the Group’s financial liabilities, on an
undiscounted basis, which therefore differs from both the carrying value and fair value, is as follows:
Bank | Total | Derivative | Derivative | Total | |||||
overdrafts | Trade non-derivative | financial | financial | derivative | |||||
and other | Bonds and | Lease | and other | financial | instruments | instruments | financial | ||
loans | bank loans | liabilities | payables | instruments | receivable | payable | instruments | Total | |
$m | $m | $m | $m | $m | $m | $m | $m | $m | |
Within one year | 365 | 5,777 | 249 | 19,065 | 25,456 | (12,445) | 12,478 | 33 | 25,489 |
In one to two years | – | 5,233 | 208 | 2,086 | 7,527 | (1,012) | 1,078 | 66 | 7,593 |
In two to three years | – | 2,608 | 172 | 872 | 3,652 | (34) | 38 | 4 | 3,656 |
In three to four years | – | 2,983 | 128 | 595 | 3,706 | (103) | 103 | – | 3,706 |
In four to five years | – | 1,267 | 84 | 814 | 2,165 | (32) | 35 | 3 | 2,168 |
In more than five years | – | 18,156 | 184 | 3,177 | 21,517 | (1,436) | 1,378 | (58) | 21,459 |
365 | 36,024 | 1,025 | 26,609 | 64,023 | (15,062) | 15,110 | 48 | 64,071 | |
Effect of interest | (15) | (7,982) | – | – | (7,997) | 227 | (249) | (22) | (8,019) |
Effect of discounting, fair values and issue costs | – | (113) | (72) | (3,299) | (3,484) | 63 | 7 | 70 | (3,414) |
31 December 2022 | 350 | 27,929 | 953 | 23,310 | 52,542 | (14,772) | 14,868 | 96 | 52,638 |
Bank |
Total |
Derivative |
Derivative |
Total |
|||||
overdrafts |
Trade non-derivative |
financial |
financial |
derivative |
|||||
and other |
Bonds and |
Lease |
and other |
financial |
instruments |
instruments |
financial |
||
loans |
bank loans |
liabilities |
payables |
instruments |
receivable |
payable |
instruments |
Total |
|
$m |
$m |
$m |
$m |
$m |
$m |
$m |
$m |
$m |
|
Within one year |
542 |
5,469 |
313 |
22,401 |
28,725 |
(11,302) |
11,366 |
64 |
28,789 |
In one to two years |
– |
2,764 |
261 |
1,482 |
4,507 |
(100) |
114 |
14 |
4,521 |
In two to three years |
– |
3,137 |
208 |
788 |
4,133 |
(164) |
179 |
15 |
4,148 |
In three to four years |
– |
2,230 |
138 |
625 |
2,993 |
(924) |
883 |
(41) |
2,952 |
In four to five years |
– |
3,822 |
88 |
12 |
3,922 |
(949) |
971 |
22 |
3,944 |
In more than five years |
– |
17,995 |
271 |
35 |
18,301 |
(1,507) |
1,340 |
(167) |
18,134 |
542 |
35,417 |
1,279 |
25,343 |
62,581 |
(14,946) |
14,853 |
(93) |
62,488 |
|
Effect of interest |
(27) |
(8,270) |
– |
– |
(8,297) |
589 |
(644) |
(55) |
(8,352) |
Effect of discounting, fair values and issue costs |
– |
(168) |
(151) |
(309) |
(628) |
44 |
(46) |
(2) |
(630) |
31 December 2023 |
515 |
26,979 |
1,128 |
25,034 |
53,656 |
(14,313) |
14,163 |
(150) |
53,506 |
Bank |
Total |
Derivative |
Derivative |
Total |
|||||
overdrafts |
Trade non-derivative |
financial |
financial |
derivative |
|||||
and other Bonds and |
Lease |
and other |
financial |
instruments |
instruments |
financial |
|||
loans |
bank loans |
liabilities |
payables |
instruments |
receivable |
payable |
instruments |
Total |
|
$m |
$m |
$m |
$m |
$m |
$m |
$m |
$m |
$m |
|
Within one year |
345 |
3,045 |
396 |
22,501 |
26,287 |
(16,227) |
16,282 |
55 |
26,342 |
In one to two years |
– |
3,437 |
345 |
1,086 |
4,868 |
(207) |
250 |
43 |
4,911 |
In two to three years |
– |
3,670 |
266 |
105 |
4,041 |
(917) |
956 |
39 |
4,080 |
In three to four years |
– |
3,978 |
170 |
750 |
4,898 |
(941) |
1,044 |
103 |
5,001 |
In four to five years |
– |
3,780 |
117 |
– |
3,897 |
(627) |
489 |
(138) |
3,759 |
In more than five years |
– |
19,929 |
406 |
– |
20,335 |
(2,437) |
2,583 |
146 |
20,481 |
345 |
37,839 |
1,700 |
24,442 |
64,326 |
(21,356) |
21,604 |
248 |
64,574 |
|
Effect of interest |
(15) |
(9,173) |
– |
– |
(9,188) |
808 |
(1,068) |
(260) |
(9,448) |
Effect of discounting, fair values and issue costs |
– |
(153) |
(248) |
(207) |
(608) |
36 |
(95) |
(59) |
(667) |
31 December 2024 |
330 |
28,513 |
1,452 |
24,235 |
54,530 |
(20,512) |
20,441 |
(71) |
54,459 |
Where interest payments are on a floating rate basis, it is assumed that rates will remain unchanged from the last business day of each year
ended 31 December.
It is not expected that the cash flows in the maturity profile could occur significantly earlier or at significantly different amounts, with the
Financial Statements
Notes to the Group Financial Statements
continued
28 Financial risk management objectives and policies
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
196
Interest rate risk
The Group maintains a Board-approved mix of fixed and floating rate debt and uses underlying debt, interest rate swaps and forward rate
agreements to manage this mix.
The majority of surplus cash is currently invested in US dollar liquidity funds.
The interest rate profile of the Group’s interest-bearing financial instruments is set out below. In the case of current and non-current financial
liabilities, the classification includes the impact of interest rate swaps which convert the debt to floating rate.
| 2024 |
2023 |
2022 |
|||||||
Fixed rate |
Floating rate |
Total |
Fixed rate |
Floating rate |
Total |
Fixed rate |
Floating rate |
Total |
|
$m |
$m |
$m |
$m |
$m |
$m |
$m |
$m |
$m |
|
Financial liabilities |
|||||||||
Current |
2,346 |
330 |
2,676 |
2,885 |
2,515 |
5,400 |
2,476 |
3,066 |
5,542 |
Non-current |
26,151 |
1,468 |
27,619 |
23,222 |
– |
23,222 |
21,511 |
2,179 |
23,690 |
Total |
28,497 |
1,798 |
30,295 |
26,107 |
2,515 |
28,622 |
23,987 |
5,245 |
29,232 |
Financial assets |
|||||||||
Fixed deposits |
– |
– |
– |
– |
– |
– |
64 |
– |
64 |
Cash collateral pledged to counterparties |
– |
129 |
129 |
– |
102 |
102 |
– |
162 |
162 |
Cash and cash equivalents |
– |
5,488 |
5,488 |
– |
5,840 |
5,840 |
250 |
5,916 |
6,166 |
Total |
– |
5,617 |
5,617 |
– |
5,942 |
5,942 |
314 |
6,078 |
6,392 |
In addition to the financial assets above, there are $11,115m (2023: $11,288m; 2022: $9,546m) of other current and non-current asset investments
and other financial assets.
The Group is also exposed to market risk on other investments.
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Equity securities at fair value through Other comprehensive income (Note 12) |
1,632 |
1,530 |
1,056 |
Non-current fixed income securities at fair value through profit or loss (Note 12) |
– |
– |
10 |
Total |
1,632 |
1,530 |
1,066 |
Foreign currency risk
The US dollar is the Group’s most significant currency. As a consequence, the Group results are presented in US dollars and exposures are
managed against US dollars accordingly.
Translational
Approximately 60% of Group external sales in 2024 were denominated in currencies other than the US dollar, while a significant proportion
of manufacturing, and research and development costs were denominated in pound sterling and Swedish krona. Surplus cash generated
by business units is substantially converted to, and held centrally in, US dollars. As a result, operating profit and total cash flow in US dollars
will be affected by movements in exchange rates. This currency exposure is managed centrally, based on forecast cash flows. The impact
of movements in exchange rates is mitigated significantly by the correlations which exist between the major currencies to which the Group
is exposed and the US dollar. Monitoring of currency exposures and correlations is undertaken on a regular basis and hedging is subject to
pre-execution approval.
As at 31 December 2024, before the impact of derivatives or other forms of hedging, the Group held $548m of interest-bearing loans and
borrowings denominated in pound sterling and $4,876m denominated in euros.
$438m of the pound sterling loan and $829m of the euro loans balances are designated in a net investment hedge where they hedge an
underlying net investment of that amount in the same currency. $2,387m of the euro loans are designated in cashflow hedges, where they are
hedged with cross-currency swaps. Exchange differences on the retranslation of debt designated in a net investment hedge or a cashflow
hedge are recognised in Other comprehensive income to the extent the hedge is effective. $1,468m of the euro loans are designated in fair
value hedges, hedged with cross-currency swaps. Exchange difference on the retranslation of debt designated in a fair value hedge is
recognised within Finance income and expense.
For further details of all designated hedging relationships please refer to the Hedge accounting section within this Note 28, from page 199.
The accounting treatment for any hedge ineffectiveness is disclosed in the Bank and other borrowings accounting policy and the Foreign
currencies accounting policy on page 158 within Group Accounting Policies.
As at 31 December 2024, the Group operates in three countries designated as hyperinflationary, being Argentina, Venezuela and Turkey.
The foreign exchange risk of these markets has been assessed and deemed to be immaterial.
Transactional
The Group aims to hedge all its forecasted major transactional currency exposures on working capital balances, which typically extend for up
to three months. Where practicable, these are hedged using forward foreign exchange contracts. In addition, external dividend payments in
pound sterling to UK shareholders and in Swedish krona to Swedish shareholders are fully hedged from announcement date to payment date.
Foreign exchange gains and losses on forward contracts transacted for transactional hedging are taken to profit and loss or to Other
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
197
The sensitivity analysis set out below summarises the sensitivity of the market value of our financial instruments to hypothetical changes in
market rates and prices. The range of variables chosen for the sensitivity analysis reflects our view of changes which are reasonably possible
over a one-year period. Market values are the present value of future cash flows based on market rates and prices at the valuation date. For
long-term debt, an increase in interest rates results in a decline in the fair value of debt.
The sensitivity analysis assumes an instantaneous 100 basis point change in interest rates in all currencies from their levels at 31 December
2024, with all other variables held constant. Based on the composition of our long-term debt portfolio and cash reserves as at 31 December
2024, a 1% increase in interest rates would result in an additional $18m in interest expense on the debt and an additional $56m interest income
on the cash reserves.
The exchange rate sensitivity analysis assumes an instantaneous 10% change in foreign currency exchange rates from their levels at
31 December 2024, with all other variables held constant. The +10% case assumes a 10% strengthening of the US dollar against all other
currencies and the -10% case assumes a 10% weakening of the US dollar.
Each incremental 10% movement in foreign currency exchange rates would have approximately the same effect as the initial 10% detailed
in the table below and each incremental 1% change in interest rates would have approximately the same effect as the 1% detailed in the
table below.
| Interest rates |
Exchange rates |
|||
31 December 2022 |
+1% |
−1% |
+10% |
−10% |
Increase/(decrease) in fair value of financial instruments ($m) |
1,317 |
(1,490) |
81 |
(89) |
Impact on profit: gain/(loss) ($m) |
– |
– |
26 |
(15) |
Impact on equity: gain/(loss) ($m) |
– |
– |
55 |
(74) |
| Interest rates |
Exchange rates |
|||
31 December 2023 |
+1% |
−1% |
+10% |
−10% |
Increase/(decrease) in fair value of financial instruments ($m) |
1,361 |
(1,534) |
196 |
(212) |
Impact on profit: gain/(loss) ($m) |
– |
– |
134 |
(128) |
Impact on equity: gain/(loss) ($m) |
– |
– |
62 |
(83) |
| Interest rates |
Exchange rates |
|||
31 December 2024 |
+1% |
−1% |
+10% |
−10% |
Increase/(decrease) in fair value of financial instruments ($m) |
1,407 |
(1,561) |
11 |
(20) |
Impact on profit: (loss)/gain ($m) |
– |
– |
(117) |
133 |
Impact on equity: gain/(loss) ($m) |
– |
– |
128 |
(152) |
The Group is exposed to credit risk on financial assets, such as cash investments, derivative instruments, and Trade and other receivables.
The Group was also exposed in its Net asset position to its own credit risk in respect of the 2023 debentures which were accounted for at
FVPL. Under IFRS 9, the effect of the losses and gains arising from own credit risk on the fair value of bonds designated at FVPL are recorded
The majority of the Group’s cash is centralised within the Group treasury entity and is subject to counterparty risk on the principal invested.
The level of the Group’s cash investments and hence credit risk will depend on the cash flow generated by the Group and the timing of the
use of that cash. The credit risk is mitigated through a policy of prioritising security and liquidity over return and, as such, cash is only invested
in high credit-quality investments. Counterparty limits are set according to the assessed risk of each counterparty and exposures are monitored
against these limits on a regular basis.
The Group’s principal financial counterparty credit risks at 31 December were as follows:
Current assets
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Cash at bank and in hand |
1,215 |
1,325 |
1,411 |
Money market liquidity funds |
4,177 |
4,425 |
4,486 |
Other short-term cash equivalents |
96 |
90 |
269 |
Total Cash and cash equivalents (Note 17) |
5,488 |
5,840 |
6,166 |
Fixed income securities at fair value through profit or loss (Note 12) |
37 |
20 |
13 |
Cash collateral pledged to counterparties (Note 12) |
129 |
102 |
162 |
Fixed deposits (Note 12) |
– |
– |
64 |
Total derivative financial instruments (Note 13) |
54 |
116 |
87 |
Current assets subject to credit risk |
5,708 |
6,078 |
6,492 |
Non-current assets | |||
2024 | 2023 | 2022 | |
$m | $m | $m | |
Derivative financial instruments (Note 13) | 182 | 228 | 74 |
Non-current assets subject to credit risk | 182 | 228 | 74 |
Financial Statements
Notes to the Group Financial Statements
continued
28 Financial risk management objectives and policies
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
198
The majority of the Group’s cash is invested in US dollar AAA-rated money market liquidity funds. The money market liquidity fund portfolios
are managed by six external third-party fund managers to maintain an AAA rating. The Group’s investments represent no more than 10% of
each overall fund value. There were no other significant concentrations of financial credit risk at the reporting date.
All financial derivatives are transacted with commercial banks, in line with standard market practice. The Group has agreements with some
bank counterparties whereby the parties agree to post cash collateral, for the benefit of the other, equivalent to the market valuation of the
derivative positions above a predetermined threshold. The carrying value of such cash collateral held by the Group at 31 December 2024
was $181m (2023: $215m; 2022: $89m) and the carrying value of such cash collateral posted by the Group at 31 December 2024 was $129m
(2023: $102m; 2022: $162m).
Offsetting of financial assets and liabilities
Financial assets and liabilities are offset and the net amount reported in the Consolidated Statement of Financial Position where there is both
a legally enforceable right and an intention to settle the balances on a net basis. There are also arrangements that would not normally meet
the requirement for offsetting but may be offset in certain circumstances such as the termination of a contract or bankruptcy.
The tables below show the impact on the Consolidated Statement of Financial Position if all offset rights were exercised by the Group or its
financial counterparties.
| Related amounts not offset |
||||
Gross |
Subject to |
Financial |
||
financial |
master netting |
instrument |
||
assets/(liabilities) |
agreement |
collateral |
Net Amount |
|
31 December 2022 |
$m |
$m |
$m |
$m |
Financial assets |
||||
Derivatives |
161 |
(29) |
(61) |
71 |
Other investments 1 |
162 |
– |
(161) |
1 |
Total assets |
323 |
(29) |
(222) |
72 |
Financial liabilities |
||||
Derivatives |
(257) |
29 |
161 |
(67) |
Other payables 1 |
(89) |
– |
61 |
(28) |
Total liabilities |
(346) |
29 |
222 |
(95) |
| Related amounts not offset |
||||
Gross |
Subject to |
Financial |
||
financial |
master netting |
instrument |
||
assets/(liabilities) |
agreement |
collateral |
Net Amount |
|
31 December 2023 |
$m |
$m |
$m |
$m |
Financial assets |
||||
Derivatives |
344 |
(107) |
(203) |
34 |
Other investments 1 |
102 |
– |
(65) |
37 |
Total assets |
446 |
(107) |
(268) |
71 |
Financial liabilities |
||||
Derivatives |
(194) |
107 |
65 |
(22) |
Other payables 1 |
(215) |
– |
203 |
(12) |
Total liabilities |
(409) |
107 |
268 |
(34) |
| Related amounts not offset |
||||
Gross |
Subject to |
Financial |
||
financial |
master netting |
instrument |
||
assets/(liabilities) |
agreement |
collateral |
Net Amount |
|
31 December 2024 |
$m |
$m |
$m |
$m |
Financial assets |
||||
Derivatives |
236 |
(45) |
(169) |
22 |
Other investments 1 |
129 |
– |
(112) |
17 |
Total assets |
365 |
(45) |
(281) |
39 |
Financial liabilities |
||||
Derivatives |
(165) |
45 |
112 |
(8) |
Other payables 1 |
(181) |
– |
169 |
(12) |
Total liabilities |
(346) |
45 |
281 |
(20) |
1
Trade receivable exposures are managed locally in the operating units where they arise and credit limits are set as deemed appropriate for the
customer. The Group is exposed to customers ranging from government-backed agencies and large private wholesalers to privately-owned
pharmacies, and the underlying local economic and sovereign risks vary throughout the world. Where appropriate, the Group endeavours
to minimise risks by the use of trade finance instruments such as letters of credit and insurance. The Group applies the expected credit loss
approach to establish an allowance for impairment that represents its estimate of expected losses in respect of Trade receivables.
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
199
The Group applies the IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance to Trade
receivables. To measure expected credit losses, Trade receivables have been grouped based on shared credit characteristics and the days
past due.
The expected loss rates are based on payment profiles over a period of 36 months before 31 December 2024, 31 December 2023, or
31 December 2022 respectively and the corresponding historical credit losses experienced within this period. The historical loss rates
are adjusted to reflect current and forward-looking information on macroeconomic factors affecting the ability of the customer to settle
the receivables.
On that basis, the loss allowance was determined as follows:
0-90 days |
90-180 days |
Over 180 days |
|||
31 December 2022 |
Current |
past due |
past due |
past due |
Total |
Expected loss rate |
0.03% |
0.3% |
32.0% |
40.6% |
|
Gross carrying amount ($m) |
6,791 |
331 |
50 |
99 |
7,271 |
Loss allowance ($m) |
2 |
1 |
16 |
40 |
59 |
0-90 days |
90-180 days |
Over 180 days |
|||
31 December 2023 |
Current |
past due |
past due |
past due |
Total |
Expected loss rate |
0.01% |
0.3% |
0.8% |
15.0% |
|
Gross carrying amount ($m) |
7,709 |
342 |
121 |
280 |
8,452 |
Loss allowance ($m) |
1 |
1 |
1 |
42 |
45 |
0-90 days |
90-180 days |
Over 180 days |
|||
31 December 2024 |
Current |
past due |
past due |
past due |
Total |
Expected loss rate |
0.01% |
0.6% |
3.5% |
7.0% |
|
Gross carrying amount ($m) |
7,679 |
171 |
86 |
399 |
8,335 |
Loss allowance ($m) |
1 |
1 |
3 |
28 |
33 |
Trade receivables are written off where there is no reasonable expectation of recovery.
Impairment losses on Trade receivables are presented as net impairment losses within Operating profit, any subsequent recoveries are
credited against the same line.
In the US, sales to three wholesalers accounted for approximately 74% (2023: 80%; 2022: 73%) of US sales.
The movements of the Group expected credit losses provision are as follows:
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
At 1 January |
45 |
59 |
23 |
Net movement recognised in the Consolidated Statement of Comprehensive Income |
(3) |
(14) |
37 |
Amounts utilised, exchange and other movements |
(9) |
– |
(1) |
At 31 December |
33 |
45 |
59 |
Given the profile of our customers, including large wholesalers and government-backed agencies, no further credit risk has been identified
The Group uses foreign currency borrowings, foreign currency forwards and swaps, currency options, interest rate swaps and cross-currency
interest rate swaps for the purpose of hedging its foreign currency and interest rate risks. The Group may designate certain financial instruments
as fair value hedges, cash flow hedges or net investment hedges in accordance with IFRS 9. Hedge effectiveness is determined at the
inception of the hedge relationship, and through periodic prospective effectiveness assessments to ensure that an economic relationship
exists between the hedged item and hedging instrument. Sources of hedge effectiveness will depend on the hedge relationship designation
but may include:
•
a significant change in the credit risk of either party to the hedging relationship
•
a timing mismatch between the hedging instrument and the hedged item
•
movements in foreign currency basis spread for derivatives in a fair value hedge
•
a significant change in the value of the foreign currency-denominated net assets of the Group in a net investment hedge.
The hedge ratio for each designation will be established by comparing the quantity of the hedging instrument and the quantity of the hedged
item to determine their relative weighting, for all of the Group’s existing hedge relationships the hedge ratio has been determined as 1:1.
Designated hedges are expected to be effective and therefore the impact of ineffectiveness on profit and loss not expected to be material.
The accounting treatment for fair value hedges and debt designated as FVPL is disclosed in the Bank and other borrowings accounting
Financial Statements
Notes to the Group Financial Statements
continued
28 Financial risk management objectives and policies
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
200
The following table represents the Group’s continuing designated hedge relationships under IFRS 9.
2022 | |||||||||
| Other comprehensive income | |||||||||
Fair value | |||||||||
(gain)/loss | |||||||||
Opening | Fair value | recycled | Closing | ||||||
Nominal | balance | (gain)/loss | to the | balance | Average | ||||
amounts | Carrying | 1 January | deferred | Income | 31 December | Average Average | pay | ||
in local | value | 2022 | to OCI | statement | 2022 | maturity | USD FX | interest | |
currency | $m | $m | $m | $m | $m | year | rate | rate | |
Cash flow hedges – foreign currency and interest rate risk 1,3,4 | |||||||||
Cross-currency interest rate swaps – Euro bonds | EUR 1,700m | (160) | 27 | 118 | (111) | 34 | 2026 | 1.14 | USD 2.85% |
FX Forwards – short-term FX risk | USD 1,126m | (12) | (12) | (14) | 38 | 12 | 2023 | – | – |
Net investment hedge – foreign exchange risk 2,3 | |||||||||
Transactions matured pre-2022 | – | (527) | – | – | (527) | – | – | – | |
Cross-currency interest rate swap – JPY investment | JPY 58.3bn | 55 | (62) | 7 | – | (55) | 2029 | 108.03 | JPY 1.53% |
Cross-currency interest rate swap – CNY investment | CNY 458m | (4) | 2 | 2 | – | 4 | 2026 | 6.68 | CNY 4.80% |
Foreign currency borrowing – GBP investment | GBP 350m | 420 | (238) | (50) | – | (288) | 2031 | n/a | GBP 5.75% |
Foreign currency borrowing – EUR investment 5 | EUR 800m | 846 | (50) | (52) | – | (102) | 2029 | n/a | EUR 0.38% |
Contingent consideration liabilities and Acerta Pharma | |||||||||
share purchase liability – AZUK and AZAB USD investments | USD 2,093m | (2,093) | 1,832 | 384 | – | 2,216 | – | – | – |
2023 | |||||||||
| Other comprehensive income | |||||||||
Fair value | |||||||||
(gain)/loss | |||||||||
Opening | Fair value | recycled | Closing | ||||||
Nominal | balance | (gain)/loss | to the | balance | Average | ||||
amounts | Carrying | 1 January | deferred | Income | 31 December | Average Average | pay | ||
in local | value | 2023 | to OCI | statement | 2023 | maturity | USD FX | interest | |
currency | $m | $m | $m | $m | $m | year | rate | rate | |
Cash flow hedges – foreign currency and interest rate risk 1,3,4 | |||||||||
Cross-currency interest rate swaps – Euro bonds | EUR 3,200m | 49 | 34 | (210) | 139 | (37) | 2027 | 1.10 | USD 3.80% |
FX Forwards – short-term FX risk | USD 2,009m | 15 | 12 | (33) | 6 | (15) | 2024 | – | – |
Net investment hedge – foreign exchange risk 2,3 | |||||||||
Transactions matured pre-2023 | – | (527) | – | – | (527) | – | – | – | |
Cross-currency interest rate swap – JPY investment | JPY 58.3bn | 100 | (55) | (45) | – | (100) | 2029 | 108.03 | JPY 1.53% |
Cross-currency interest rate swap – CNY investment | CNY 458m | (1) | 4 | (3) | – | 1 | 2026 | 6.68 | CNY 4.80% |
Foreign currency borrowing – GBP investment | GBP 350m | 444 | (288) | 24 | – | (264) | 2031 | n/a | GBP 5.75% |
Foreign currency borrowing – EUR investment 5 | EUR 800m | 881 | (102) | 33 | – | (69) | 2029 | n/a | EUR 0.38% |
Contingent consideration liabilities and Acerta Pharma | |||||||||
share purchase liability – AZUK and AZAB USD investments | USD 1,937m | (1,937) | 2,216 | (81) | – | 2,135 | – | – | – |
2024 | |||||||||
| Other comprehensive income | |||||||||
Fair value | |||||||||
(gain)/loss | |||||||||
Opening | Fair value | recycled | Closing | ||||||
Nominal | balance | (gain)/loss | to the | balance | Average | ||||
amounts | Carrying | 1 January | deferred | Income | 31 December | Average Average | pay | ||
in local | value | 2024 | to OCI | statement | 2024 | maturity | USD FX | interest | |
currency | $m | $m | $m | $m | $m | year | rate | rate | |
Cash flow hedges – foreign currency and interest rate risk 1,3,4 | |||||||||
Cross-currency interest rate swaps – Euro bonds | EUR 2,300m | (36) | (37) | 151 | (180) | (66) | 2029 | 1.08 | USD 4.24% |
FX Forwards – short-term FX risk | USD 2,252m | 4 | (15) | 8 | 3 | (4) | 2025 | – | – |
Net investment hedge – foreign exchange risk 2,3 | |||||||||
Transactions matured pre-2024 | – | (527) | – | – | (527) | – | – | – | |
Cross-currency interest rate swap – JPY investment | JPY 58.3bn | 146 | (100) | (45) | – | (145) | 2029 | 108.03 | JPY 1.53% |
Cross-currency interest rate swap – CNY investment | CNY 458m | 2 | 1 | (4) | – | (3) | 2026 | 6.68 CNY 4.80% | |
Foreign currency borrowing – GBP investment | GBP 350m | 438 | (264) | (7) | – | (271) | 2031 | n/a | GBP 5.75% |
Foreign currency borrowing – EUR investment 5 | EUR 800m | 829 | (69) | (52) | – | (121) | 2029 | n/a | EUR 0.38% |
Contingent consideration liabilities and Acerta Pharma | |||||||||
share purchase liability – AZUK and AZAB USD investments | USD 1,367m | (1,367) | 2,135 | 181 | – | 2,316 | – | – | – |
1
Hedge ineffectiveness recognised on swaps designated in a cash flow hedge during the period was $nil (2023: $nil; 2022: $nil).
2
Hedge ineffectiveness recognised on swaps designated in a net investment hedge during the period was $nil (2023: $nil; 2022: $nil).
3
Fair value movements on cross-currency interest rate swaps in cash flow hedge and net investment hedge relationships are shown inclusive of the impact of costs of hedging.
4
Nominal amount of FX forwards in a cash flow hedge of $2,252m represents the USD equivalent notional of the FX forwards. By currency, the nominal amounts were SEK 10,792m
at FX rate 10.9999, JPY 31,013m at 156.195, GBP 168m at 0.7962 and EUR 375m at 0.9605. All FX forwards in a cash flow hedge mature on 27 January 2025.
5
The EUR 800m 0.375% 2029 Non-callable bond is designated in a net investment hedge of the foreign currency exposure in relation to an equivalent amount of EUR-denominated
net assets.
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
201
Key controls applied to transactions in derivative financial instruments are to use only instruments where good market liquidity exists, to
revalue all financial instruments regularly using current market rates and to sell options only to offset previously purchased options or as part
of a risk management strategy. The Group is not a net seller of options, and does not use derivative financial instruments for speculative
purposes. The Group held no options during the reporting period.
The table below summarises the change in the fair value of hedging instruments and the hedged item designated in a fair value hedging
relationship used to calculate ineffectiveness in the period. The hedge relates to the EUR 2030 and EUR 2033 bonds issued during 2024,
consequently there are no prior year comparatives.
Change in fair value |
Change in fair value |
Hedge |
||
Nominal |
of hedging instrument |
of hedged item |
ineffectiveness |
|
amounts in |
used to calculate |
used to calculate |
recognised in |
|
As at 31 December 2024 |
currency |
ineffectiveness |
ineffectiveness |
profit and loss |
Interest rate and foreign currency risk on finance debt |
EUR 1,400m |
(56) |
54 |
(2) |
Employee costs
The monthly average number of people, to the nearest hundred, employed by the Group is set out in the table below. In accordance with the
Companies Act 2006, this includes part-time employees.
2024 |
2023 |
2022 |
|
Employees |
|||
UK |
11,100 |
10,700 |
9,800 |
Rest of Europe |
25,500 |
23,000 |
20,600 |
The Americas |
24,700 |
22,400 |
20,900 |
Asia, Africa & Australasia |
31,600 |
30,300 |
30,700 |
Continuing operations |
92,900 |
86,400 |
82,000 |
Geographical distribution described in the table above is by location of legal entity employing staff. Certain staff will undertake some or all
of their activity in a different location.
The number of people employed by the Group at the end of 2024 was 94,300 (2023: 89,900; 2022: 83,500).
The costs incurred during the year in respect of these employees were:
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Wages and salaries |
10,340 |
9,341 |
8,656 |
Social security costs |
1,224 |
1,100 |
991 |
Pension costs |
614 |
537 |
546 |
Other employment costs |
1,531 |
1,357 |
1,338 |
Total |
13,709 |
12,335 |
11,531 |
Severance costs of $283m are not included above (2023: $123m; 2022: $227m).
The charge for share-based payments in respect of share plans is $660m (2023: $579m; 2022: $619m). Payments totalling $354m made to
the EBT upon the vesting of share awards are recognised within operating cash flows, reflecting the substance of the arrangement in place
between the Group and the Trust prior to 10 June 2024. Following an amendment to the EBT on that date, AstraZeneca obtained control
and commenced consolidation of the EBT from June 2024 onward. Consequently, $81m in cash used by the EBT for purchasing shares
since 10 June 2024 is now presented within financing cash flows. The plans are equity settled.
The Directors believe that, together with the basic salary system, the Group’s employee incentive schemes provide competitive and market-
related packages to motivate employees. They should also align the interests of employees with those of shareholders, as a whole, through
long-term share ownership in the Company. The Group’s current US, UK and Swedish schemes are described below; other arrangements
apply elsewhere.
US
In the US, there are two employee short-term performance bonus plans in operation to differentiate and reward strong individual performance.
Performance bonuses are paid in cash. The AstraZeneca Performance Share Plan and the AstraZeneca Global Restricted Share Plan operate
in respect of relevant employees in the US. AstraZeneca ADRs necessary to satisfy the awards are purchased on the market or funded via
a trust.
UK
The AstraZeneca UK Performance Bonus Plan
Employees of participating AstraZeneca UK companies are invited to participate in this bonus plan, which rewards strong individual performance.
Bonuses are paid in cash.
Financial Statements
Notes to the Group Financial Statements
continued
29 Employee costs and share plans for employees
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
202
The AstraZeneca UK All-Employee Share Plans
AstraZeneca Share Incentive Plan (SIP)
The Company offers UK employees the opportunity to buy Partnership Shares (Ordinary Shares). Employees may invest up to £150 a month
to purchase Partnership Shares in the Company at the current market value. In 2010, the Company introduced a Matching Share element, the
first award of which was made in 2011. Currently one Matching Share is awarded for every four Partnership Shares purchased. Partnership
Shares and Matching Shares are held in the HM Revenue & Customs (HMRC)-approved All-Employee Share Plan. At the Company’s AGM in
2002, shareholders approved the issue of new shares for the purposes of the All-Employee Share Plan.
AstraZeneca Sharesave Plan
The Company provides UK employees with the opportunity to participate in the HMRC-approved Sharesave Plan. Employees can choose
between a 3-year or 5-year savings contract, allowing them to contribute a minimum of £5 and a maximum of £500 per month. At the end of
the savings term, participants have the option to purchase AstraZeneca shares at a predetermined share price, offering a valuable opportunity
to invest in the Company’s future.
Sweden
In Sweden, an all-employee performance bonus plan is in operation, which rewards strong individual performance. Bonuses are paid 50%
into a fund investing in AstraZeneca equities and 50% in cash. The AstraZeneca Executive Annual Bonus Scheme, the AstraZeneca Performance
Share Plan and the AstraZeneca Global Restricted Stock Plan all operate in respect of relevant AstraZeneca employees in Sweden.
Other bonus and share plans that operate across the Group are described below.
The AstraZeneca Executive Annual Bonus Scheme
This scheme is a performance bonus scheme for Directors and senior employees who do not participate in the AstraZeneca UK Performance
Bonus Plan. Annual bonuses are paid in cash and reflect both corporate and individual performance measures. The Remuneration Committee
has discretion to reduce or withhold bonuses if business performance falls sufficiently short of expectations in any year such as to make
the payment of bonuses inappropriate.
The AstraZeneca Deferred Bonus Plan
This plan was introduced in 2006 and is used to defer a portion of the bonus earned under the AstraZeneca Executive Annual Bonus Scheme
into Ordinary Shares in the Company for a period of three years. The plan currently operates only in respect of Executive Directors and
members of the SET (with awards granted as AstraZeneca ADRs for members of SET employed within the US). Awards of shares under this
plan are typically made in March each year, the first award having been made in February 2006.
The AstraZeneca Performance Share Plan
This plan was approved by shareholders in 2020 for a period of 10 years (subsequently amended by approval of shareholders in 2021) and
replaces the 2014 AstraZeneca Performance Share Plan. Generally, awards can be granted at any time, but not during a closed period of the
Company. The first grant of Performance Share Plan awards was made in May 2014 under the 2014 AstraZeneca Performance Share Plan.
Awards granted under the plan vest after three years, or in the case of Executive Directors and members of the SET, after an additional
two-year holding period, and is subject to the achievement of performance conditions. For awards granted to all participants in 2024, vesting
is subject to a combination of measures focused on science and innovation, revenue growth, financial performance and carbon reduction.
The Remuneration Committee has responsibility for agreeing any awards under the plan and for setting the policy for the way in which the
plan should be operated, including agreeing performance targets and which employees should be eligible to participate.
The AstraZeneca Investment Plan
This plan was introduced in 2010 and approved by shareholders at the 2010 AGM. The final grant of awards under this plan took place in
March 2016. Awards granted under the plan vest after eight years and are subject to performance conditions measured over a period of
four years.
The AstraZeneca Global Restricted Stock Plan
The Global Restricted Stock Plan (GRSP) was introduced in 2010. This plan provides for the grant of restricted stock unit (RSU) awards to
selected below SET-level employees and is used in conjunction with the AstraZeneca Performance Share Plan to provide a mix of RSUs
and performance share units (PSUs). Awards typically vest on the third anniversary of the date of grant and are contingent on continued
employment with the Company. The Remuneration Committee has responsibility for agreeing any awards under the plan and for setting
the policy for the way in which the plan should be operated.
The AstraZeneca Restricted Share Plan
This plan was introduced in 2008 and provides for the grant of restricted stock unit (RSU) awards to key employees, excluding Executive
Directors. Awards are made on an ad hoc basis with variable vesting dates. The plan has been used four times in 2024 to make awards to
537 employees. The Remuneration Committee has responsibility for agreeing any awards under the plan and for setting the policy for the
way in which the plan should be operated.
The AstraZeneca Extended Incentive Plan
This plan was introduced in 2018 and provides for the grant of awards to key employees, excluding Executive Directors. Awards are made on
an ad hoc basis and 50% of the award will normally vest on the fifth anniversary of grant, with the balance vesting on the tenth anniversary
of grant. The award can be subject to the achievement of performance conditions. The Remuneration Committee has responsibility for
agreeing any awards under the plan and for setting the policy for the way in which the plan should be operated, including agreeing performance
targets (if any) and which employees should be invited to participate.
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
203
Details of share options outstanding during the year for the main share plans are shown below:
| The AstraZeneca |
The AstraZeneca |
The AstraZeneca |
The AstraZeneca |
|||||
Performance Share Plan |
Global Restricted Stock Plan |
Restricted Share Plan |
Extended Incentive Plan |
|||||
Ordinary |
Ordinary |
Ordinary |
Ordinary |
|||||
Shares |
ADR Shares |
Shares |
ADR Shares 1 |
Shares |
ADR Shares |
Shares |
ADR Shares |
|
ʼ000 |
ʼ000 |
ʼ000 |
ʼ000 |
ʼ000 |
ʼ000 |
ʼ000 |
ʼ000 |
|
Outstanding at 1 January 2022 |
3,459 |
5,178 |
2,028 |
9,541 |
255 |
763 |
282 |
195 |
Granted |
1,059 |
2,339 |
1,237 |
6,478 |
75 |
216 |
– |
– |
Forfeited |
(132) |
(570) |
(190) |
(1,627) |
(25) |
(136) |
(23) |
– |
Cancelled |
– |
– |
– |
(3) |
– |
– |
– |
– |
Exercised |
(756) |
(1,223) |
(606) |
(2,706) |
(72) |
(165) |
– |
– |
Outstanding at 31 December 2022 |
3,630 |
5,724 |
2,469 |
11,683 |
233 |
678 |
259 |
195 |
Granted |
976 |
2,071 |
1,185 |
6,343 |
208 |
436 |
71 |
95 |
Forfeited |
(148) |
(437) |
(187) |
(1,417) |
(20) |
(59) |
(8) |
– |
Cancelled |
– |
– |
– |
(3) |
– |
– |
– |
(34) |
Exercised |
(813) |
(1,470) |
(570) |
(2,738) |
(86) |
(288) |
(107) |
(9) |
Outstanding at 31 December 2023 |
3,645 |
5,888 |
2,897 |
13,868 |
335 |
767 |
215 |
247 |
Granted |
1,064 |
2,250 |
1,262 |
7,014 |
100 |
699 |
– |
– |
Forfeited |
(137) |
(400) |
(235) |
(1,414) |
(8) |
(57) |
(31) |
– |
Cancelled |
(2) |
(2) |
– |
(6) |
(1) |
– |
– |
– |
Exercised |
(999) |
(1,586) |
(755) |
(3,296) |
(88) |
(352) |
(22) |
– |
Outstanding at 31 December 2024 |
3,571 |
6,150 |
3,169 |
16,166 |
338 |
1,057 |
162 |
247 |
1
Shares issued to Alexion employees under the GRSP are covered under the Alexion employee share award below.
| The AstraZeneca |
The AstraZeneca |
The AstraZeneca |
The AstraZeneca |
|||||
Performance Share Plan |
Global Restricted Stock Plan |
Restricted Share Plan |
Extended Incentive Plan |
|||||
WAFV 1 |
WAFV |
WAFV |
WAFV |
WAFV |
WAFV |
WAFV |
WAFV |
|
pence |
$ |
pence |
$ |
pence |
$ |
pence |
$ |
|
WAFV of 2022 grants |
8328 |
55.73 |
9167 |
61.21 |
9894 |
63.35 |
– |
– |
WAFV of 2023 grants |
9929 |
59.95 |
10822 |
65.38 |
11135 |
65.37 |
11748 |
74.78 |
WAFV of 2024 grants |
9028 |
57.99 |
10085 |
64.91 |
11111 |
75.23 |
– |
– |
1
Weighted average fair value.
Alexion employee share award plan
At acquisition in 2021 Alexion employee share awards were converted into AstraZeneca restricted stock awards that continue to have, and
shall be subject to, the same terms and conditions as applied in the corresponding Alexion awards immediately prior to completion. The fair
value at the grant date was $57.54 and of the 15,220,000 shares outstanding at 31 December 2021, 8,627,000 were exercised and 980,000
were forfeited during 2022. During 2022, Alexion employees had the option to defer awards due to vest in July 2022 until February 2023 when
they would also receive an additional vest equivalent to 15% of the shares deferred. As a result, 1,780,000 shares were deferred, resulting in
an additional 267,000 shares being issued with a grant date fair value of $65.62, that vested in 2023. During 2023, 2,060,000 shares vested,
531,000 were forfeited/cancelled and the closing balance of these awards as of 31 December 2023 was 3,022,000. During 2024, 2,047,000
shares vested, 156,000 were forfeited and the closing balance of these awards as of 31 December 2024 was 819,000.
The weighted average fair value for awards granted under the AstraZeneca Performance Share Plan is primarily based on the market price
at the point of grant adjusted for the market-based performance elements which are valued using a Monte Carlo valuation model. The fair
values of all other plans are set using the market price at the point of award. These awards are settled in equity including dividends
2024 |
2023 |
2022 |
|
Commitments |
$m |
$m |
$m |
Contracts placed for future capital expenditure on Property, plant and equipment and |
|||
software development costs not provided for in these Financial Statements |
1,575 |
1,368 |
502 |
Guarantees and contingencies arising in the ordinary course of business, for which no security has been given, are not expected to result
in any material financial loss.
Research and development collaboration payments
The Group has various ongoing collaborations, including in-licensing and similar arrangements with development partners. Such collaborations
may require the Group to make payments on achievement of stages of development, launch or revenue milestones, although the Group generally
has the right to terminate these agreements at no cost. The Group recognises research and development milestones as an intangible asset once
it is committed to payment, which is generally when the Group reaches set trigger points in the development cycle. Revenue-related milestones
are recognised as intangible assets on product launch at a value based on the Group’s long-term revenue forecasts for the related product. The
table below indicates potential development and revenue-related payments that the Group may be required to make under such collaborations.
Years 5 |
|||||
Total |
Under 1 year |
Years 1 and 2 |
Years 3 and 4 |
and greater |
|
$m |
$m |
$m |
$m |
$m |
|
Future potential research and development milestone payments |
11,213 |
1,993 |
2,823 |
3,291 |
3,106 |
Future potential revenue milestone payments |
22,064 |
41 |
1,166 |
3,026 |
17,831 |
Financial Statements
Notes to the Group Financial Statements
continued
30 Commitments, contingent liabilities and contingent assets
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
204
The table includes all potential payments for achievement of milestones under ongoing research and development arrangements. Revenue-
related milestone payments represent the maximum possible amount payable on achievement of specified levels of revenue as set out in
individual contract agreements, but exclude variable payments that are based on unit sales (e.g. royalty-type payments) which are expensed
as the associated sale is recognised. The table excludes any payments already capitalised in the Financial Statements for the year ended
31 December 2024 which have been capitalised with reference to the latest Group sales forecasts for approved indications.
The future payments we disclose represent contracted payments and, as such, are not discounted and are not risk-adjusted. As detailed in
the Risk Overview section from page 64, the development of any pharmaceutical product candidate is a complex and risky process that
may fail at any stage in the development process due to a number of factors (including items such as failure to obtain regulatory approval,
unfavourable data from key studies, adverse reactions to the product candidate or indications of other safety concerns). The timing of the
payments is based on the Group’s current best estimate of achievement of the relevant milestone.
Environmental costs and liabilities
The Group’s expenditure on environmental protection, including both capital and revenue items, relates to costs that are necessary for
implementing internal systems and programmes, and meeting legal and regulatory requirements for processes and products. This includes
investment to conserve natural resources and otherwise minimise the impact of our activities on the environment.
They are an integral part of normal ongoing expenditure for carrying out the Group’s research, manufacturing and commercial operations and
are not separated from overall operating and development costs. There are no known changes in legal, regulatory or other requirements
resulting in material changes to the levels of expenditure for 2022, 2023 or 2024.
In addition to expenditure for meeting current and foreseen environmental protection requirements, the Group incurs costs in investigating
and cleaning up legacy land and groundwater contamination. In particular, AstraZeneca has environmental liabilities at some currently or
formerly owned, leased and third-party sites.
In the US, Zeneca Inc., and/or its indemnitees, have been named as potentially responsible parties (PRPs) or defendants at a number of sites
where Zeneca Inc. is likely to incur future environmental investigation, remediation, operation and maintenance costs under federal, state,
statutory or common law environmental liability allocation schemes (together, US Environmental Consequences). Similarly, Stauffer
Management Company LLC (SMC), which was established to own and manage certain assets and liabilities of Stauffer Chemical Company, and/
or its indemnitees, have been named as PRPs or defendants at a number of sites where SMC is likely to incur US Environmental Consequences.
AstraZeneca has also given indemnities to third parties for a number of sites outside the US. These environmental liabilities arise from legacy
operations that are not currently part of the Group’s business and, at most of these sites, remediation, where required, is either completed
or in progress. AstraZeneca has made provisions for the estimated costs of future environmental investigation, remediation, operation and
maintenance activity beyond normal ongoing expenditure for maintaining the Group’s R&D and manufacturing capacity and product ranges,
where a present obligation exists, it is probable that such costs will be incurred and they can be estimated reliably. With respect to such
estimated future costs, there were provisions at 31 December 2024 in the aggregate of $105m (2023: $112m; 2022: $131m), mainly relating to
the US. Where we are jointly liable or otherwise have cost-sharing agreements with third parties, we reflect only our share of the obligation.
Where the liability is insured in part or in whole by insurance or other arrangements for reimbursement, an asset is recognised to the extent
that this recovery is virtually certain.
It is possible that AstraZeneca could incur future environmental costs beyond the extent of our current provisions. The extent of such possible
additional costs is inherently difficult to estimate due to a number of factors, including: (1) the nature and extent of claims that may be asserted
in the future; (2) whether AstraZeneca has or will have any legal obligation with respect to asserted or unasserted claims; (3) the type of
remedial action, if any, that may be selected at sites where the remedy is presently not known; (4) the potential for recoveries from or allocation
of liability to third parties; and (5) the length of time that the environmental investigation, remediation and liability allocation process can take.
As per our provisions accounting policy on page 159, Provisions for these costs are made when there is a present obligation and where it is
probable that expenditure on remedial work will be required and a reliable estimate can be made of the cost. Notwithstanding and subject to
the foregoing, we estimate the potential additional loss for future environmental investigation, remediation, remedial operation and maintenance
activity above and beyond our provisions to be, in aggregate, between $113m and $190m (2023: $114m and $191m; 2022: $113m and $188m)
which relates mainly to the US.
Legal proceedings
AstraZeneca is involved in various legal proceedings considered typical to its business, including actual or threatened litigation and actual or
potential government investigations relating to employment matters, product liability, commercial disputes, pricing, sales and marketing practices,
infringement of IP rights, and the validity of certain patents and competition laws. The more significant matters are discussed below.
Most of the claims involve highly complex issues. Often these issues are subject to substantial uncertainties and, therefore, the probability
of a loss, if any, being sustained and/or an estimate of the amount of any loss is difficult to ascertain.
Unless specifically identified below that a provision has been taken, AstraZeneca considers each of the claims to represent a contingent
liability and discloses information with respect to the nature and facts of the cases in accordance with IAS 37 ‘Provisions, Contingent
Liabilities and Contingent Assets’.
We do not believe that disclosure of the amounts sought by plaintiffs, if known, would be meaningful with respect to these legal proceedings.
This is due to a number of factors, including (i) the stage of the proceedings (in many cases trial dates have not been set) and the overall
length and extent of pre-trial discovery; (ii) the entitlement of the parties to an action to appeal a decision; (iii) clarity as to theories of liability,
damages and governing law; (iv) uncertainties in timing of litigation; and (v) the possible need for further legal proceedings to establish the
appropriate amount of damages, if any.
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
205
While there can be no assurance regarding the outcome of any of the legal proceedings referred to in this Note 30, based on management’s
current and considered view of each situation, we do not currently expect them to have a material adverse effect on our financial position
including within the next financial year. This position could of course change over time, not least because of the factors referred to above.
In cases that have been settled or adjudicated, or where quantifiable fines and penalties have been assessed and which are not subject to
appeal (or other similar forms of relief), or where a loss is probable and we are able to make a reasonable estimate of the loss, we generally
indicate the loss absorbed or make a provision for our best estimate of the expected loss.
Where it is considered that the Group is more likely than not to prevail, legal costs involved in defending the claim are charged to profit and
loss as they are incurred.
Where it is considered that the Group has a valid contract which provides the right to reimbursement (from insurance or otherwise) of legal
costs and/or all or part of any loss incurred or for which a provision has been established, and we consider recovery to be virtually certain,
the best estimate of the amount expected to be received is recognised as an asset.
KJ
Assessments as to whether or not to recognise provisions or assets, and of the amounts concerned, usually involve a series of complex
judgements about future events and can rely heavily on estimates and assumptions. AstraZeneca believes that the provisions recorded are
adequate based on currently available information and that the insurance recoveries recorded will be received. However, given the inherent
uncertainties involved in assessing the outcomes of these cases, and in estimating the amount of the potential losses and the associated
insurance recoveries, we could in the future incur judgments or insurance settlements that could have a material adverse effect on our
results in any particular period.
IP claims include challenges to the Group’s patents on various products or processes and assertions of non-infringement of patents. A loss
in any of these cases could result in loss of patent protection on the related product.
The consequences of any such loss could be a significant decrease in Product Sales, which could have a material adverse effect on our
results. The lawsuits filed by AstraZeneca for patent infringement against companies that have filed abbreviated new drug applications (ANDAs)
in the US, seeking to market generic forms of products sold by the Group prior to the expiry of the applicable patents covering these products,
typically also involve allegations of non-infringement, invalidity and unenforceability of these patents by the ANDA filers. In the event that
the Group is unsuccessful in these actions or the statutory 30-month stay expires before a ruling is obtained, the ANDA filers involved will
also have the ability, subject to FDA approval, to introduce generic versions of the product concerned.
AstraZeneca has full confidence in, and will vigorously defend and enforce, its IP.
Over the course of the past several years, including in 2024, a significant number of commercial litigation claims in which AstraZeneca is
involved have been resolved, particularly in the US, thereby reducing potential contingent liability exposure arising from such litigation.
Similarly, in part due to patent litigation and settlement developments, greater certainty has been achieved regarding possible generic entry
dates with respect to some of our patented products. At the same time, like other companies in the pharmaceutical sector and other industries,
AstraZeneca continues to be subject to government investigations around the world.
Patent litigation
Legal proceedings brought against AstraZeneca
Enhertu patent proceedings | Considered to be a contingent liability |
US | • In October 2020, Seagen Inc. (Seagen) filed a complaint against Daiichi Sankyo Company, Limited (Daiichi Sankyo) |
in the US District Court for the Eastern District of Texas (District Court) alleging that Enhertu infringes a Seagen patent. | |
AstraZeneca co-commercialises Enhertu with Daiichi Sankyo, Inc. in the US. After trial in April 2022, the jury found | |
that the patent was infringed and awarded Seagen $41.82m in past damages. In July 2022, the District Court entered | |
final judgment and declined to enhance damages on the basis of wilfulness. In October 2023, the District Court | |
entered an amended final judgment that requires Daiichi Sankyo to pay Seagen a royalty of 8% on US sales of | |
Enhertu from 1 April 2022 through to 4 November 2024, in addition to the past damages previously awarded by the | |
District Court. AstraZeneca and Daiichi Sankyo have appealed the District Court’s decision. | |
• In December 2020 and January 2021, AstraZeneca and Daiichi Sankyo, Inc. filed post-grant review (PGR) petitions | |
with the US Patent and Trademark Office (USPTO) alleging, among other things, that the Seagen patent is invalid for | |
lack of written description and enablement. The USPTO initially declined to institute the PGRs, but, in April 2022, | |
the USPTO granted the rehearing requests and instituted both PGR petitions. Seagen subsequently disclaimed all | |
patent claims at issue in one of the PGR proceedings. In July 2022, the USPTO reversed its institution decision and | |
declined to institute the other PGR petition. AstraZeneca and Daiichi Sankyo, Inc. requested reconsideration of the | |
decision not to institute review of the patent. In February 2023, the USPTO reinstituted the PGR proceeding. In February | |
2024, the USPTO issued a decision that the claims were unpatentable. Seagen has appealed this decision; the USPTO | |
has intervened in the appeal. | |
Faslodex patent proceedings | Matter concluded |
Japan | • In 2021, in Japan, AstraZeneca received notice from the Japan Patent Office (JPO) that Sandoz K.K. (Sandoz ) and |
Sun Pharma Japan Ltd. (Sun) were seeking to invalidate the Faslodex formulation patent. | |
• AstraZeneca defended the challenged patent and Sun withdrew from the JPO patent challenge. | |
• In July 2023, the JPO issued a final decision upholding various claims of the challenged patent and determining that | |
other patent claims were invalid. | |
• In August 2023, Sandoz appealed the JPO decision to the Japan IP High Court (High Court). | |
• In October 2024, the High Court affirmed the decision by the JPO. | |
• This matter is now concluded. |
Financial Statements
Notes to the Group Financial Statements
continued
30 Commitments, contingent liabilities and contingent assets
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
206
Forxiga patent proceedings | Considered to be a contingent liability |
UK | • In the UK, one of AstraZeneca’s patents relating to Forxiga is being challenged by Generics (UK) Limited, Teva |
Pharmaceutical Industries Limited, and Glenmark Pharmaceuticals Europe Limited. | |
• Trial is scheduled for March 2025. | |
Soliris patent proceedings | Considered to be a contingent liability |
Turkey | • In November 2024, Salute HC İlaçları Sanayi ve Ticaret A.Ş (Salute) served an action in the Industrial and Intellectual |
Property Rights Court in Istanbul, Turkey seeking to invalidate and enjoin enforcement of Alexion’s patent relating | |
to eculizumab. | |
Tagrisso patent proceedings | Considered to be a contingent liability |
US | • In September 2021, Puma Biotechnology, Inc. (Puma) and Wyeth LLC (Wyeth) filed a patent infringement lawsuit in |
the US District Court for the District of Delaware (District Court) against AstraZeneca relating to Tagrisso . | |
• In March 2024, the District Court dismissed Puma. | |
• The jury trial, with Wyeth as the plaintiff, took place in May 2024. The jury found Wyeth’s patents infringed and | |
awarded Wyeth $107.5m in past damages. The jury also found that the infringement was not wilful. | |
• In proceedings following the jury award, the District Court rejected AstraZeneca’s indefiniteness and equitable | |
defences but granted judgment as a matter of law in favour of AstraZeneca on the grounds that the patents were | |
invalid for lack of written description and enablement. | |
• Wyeth has filed an appeal. |
Legal proceedings brought by AstraZeneca
Brilinta patent proceedings | Considered to be a contingent asset |
US | • In 2015 and subsequently, in response to Paragraph IV notices from ANDA filers, AstraZeneca filed patent |
infringement lawsuits in the US District Court for the District of Delaware (District Court). In its complaints, AstraZeneca | |
alleged that a generic version of Brilinta , if approved and marketed, would infringe patents that are owned or licensed | |
by AstraZeneca. | |
• In 2024, AstraZeneca entered into separate settlements and the District Court entered consent judgments to dismiss | |
each of the corresponding litigations. Additional proceedings are ongoing in the District Court. | |
• No trial date has been set. | |
Calquence patent proceedings | Considered to be a contingent asset |
US | • In February 2022, in response to Paragraph IV notices from multiple ANDA filers, AstraZeneca filed patent infringement |
lawsuits in the US District Court for the District of Delaware (District Court). In its complaints, AstraZeneca alleged | |
that a generic version of Calquence capsules, if approved and marketed, would infringe patents that are owned or | |
licensed by AstraZeneca. | |
• In 2024, AstraZeneca entered into settlement agreements with all five generic manufacturers, resolving the | |
Calquence capsule ANDA litigation proceedings. | |
• AstraZeneca received Paragraph IV notices relating to patents listed in the FDA Orange Book with reference | |
to Calquence tablets from Cipla USA, Inc. and Cipla Limited (collectively, Cipla) in April 2024 and from | |
MSN Pharmaceuticals Inc. and MSN Laboratories Pvt. Ltd. (collectively, MSN) in November 2024. | |
• In response to these Paragraph IV notices, AstraZeneca filed patent infringement lawsuits against Cipla in May 2024 | |
and against MSN in January 2025 in the District Court. In the complaints, AstraZeneca alleges that a generic version | |
of Calquence tablets, if approved and marketed, would infringe patents that are owned or licensed by AstraZeneca. | |
No trial date has been scheduled. | |
Daliresp patent litigation | Considered to be a contingent asset |
US | • In 2015 and subsequently, in response to Paragraph IV notices from ANDA filers, AstraZeneca filed patent |
infringement lawsuits in the US District Court for the District of New Jersey (District Court) relating to patents listed | |
in the FDA Orange Book with reference to Daliresp . | |
• In 2022, AstraZeneca entered into a settlement agreement and the District Court entered a consent judgment to | |
dismiss the corresponding litigation. Additional ANDA challenges are pending. | |
Farxiga patent proceedings | Considered to be a contingent asset |
US | • In May 2021, AstraZeneca proceeded to trial against ANDA filer Zydus Pharmaceuticals (USA) Inc. (Zydus ) in the |
US District Court for the District of Delaware (District Court). In October 2021, the District Court issued a decision | |
finding the asserted claims of AstraZeneca’s patent as valid and infringed by Zydus’s ANDA product. In August 2022, | |
Zydus appealed the District Court decision. Zydus’s appeal has been dismissed. | |
• In December 2023, AstraZeneca initiated ANDA litigation against Sun Pharmaceutical Industries Ltd. and Sun | |
Pharmaceutical Industries, Inc. in the District Court. No trial date has been set. | |
Lokelma patent proceedings | Considered to be a contingent asset |
US | • In August 2022, in response to Paragraph IV notices, AstraZeneca initiated ANDA litigation against multiple generic |
filers in the US District Court for the District of Delaware (District Court). AstraZeneca alleged that a generic version | |
of Lokelma would infringe patents that are owned or licensed by AstraZeneca. | |
• AstraZeneca has entered into separate settlement agreements with four generic manufacturers which resulted in | |
dismissal of the corresponding litigations. | |
• Additional proceedings with the remaining generic manufacturer are ongoing in the District Court. Trial is scheduled | |
for March 2025. |
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
207
Lynparza patent proceedings | Considered to be a contingent asset |
US | • AstraZeneca received a Paragraph IV notice relating to Lynparza patents from Natco Pharma Limited (Natco) in |
December 2022, Sandoz Inc. (Sandoz) in December 2023, Cipla USA, Inc. and Cipla Limited (collectively, Cipla) in | |
May 2024, and Zydus Pharmaceuticals (USA) Inc. (Zydus ) in November 2024. In response to these Paragraph IV | |
notices, AstraZeneca, MSD International Business GmbH, and the University of Sheffield initiated ANDA litigations | |
against Natco, Sandoz, Cipla, and Zydus in the US District Court for the District of New Jersey. In the complaints, | |
AstraZeneca alleged that the defendants’ generic versions of Lynparza , if approved and marketed, would infringe | |
AstraZeneca’s patents. | |
• No trial date has been scheduled. | |
Soliris patent proceedings | Considered to be a contingent asset |
Canada | • In May 2023, Alexion initiated patent litigation in Canada alleging that Amgen Pharmaceuticals, Inc.’s (Amgen) biosimilar |
eculizumab product will infringe Alexion patents. | |
• In September 2023, Alexion initiated patent litigations in Canada alleging that Samsung Bioepis Co. Ltd.’s (Samsung) | |
biosimilar eculizumab product will infringe Alexion patents. The filing of the litigation triggered an automatic 24-month | |
stay of the approval of each defendant’s biosimilar eculizumab product. | |
• Trial against Amgen is scheduled to begin in January 2025 while trial against Samsung is scheduled to begin in | |
June 2025. | |
• In July and August 2023, in Canada, both Amgen and Samsung brought actions challenging the validity of Alexion’s | |
patent relating to the use of eculizumab in treating aHUS. Trial is scheduled for November 2025. | |
Soliris patent proceedings | Matter concluded |
US | • In January 2024, Alexion initiated patent infringement litigation against Samsung Bioepis Co. Ltd. (Samsung) in the |
US District Court for the District of Delaware (District Court) alleging that Samsung’s biosimilar eculizumab product, | |
for which Samsung is currently seeking FDA approval, will infringe six Soliris -related patents. | |
• Five of the six asserted patents were also the subject of inter partes review proceedings before the US Patent and | |
Trademark Office. | |
• Alexion filed a motion for a preliminary injunction seeking to enjoin Samsung from launching its biosimilar eculizumab | |
product upon FDA approval. The District Court denied Alexion’s motion and Alexion appealed that decision. | |
• In August 2024, the parties reached resolution of the matter. All legal proceedings in the US courts have terminated | |
as have the inter partes review proceedings. | |
Soliris patent proceedings | Considered to be a contingent asset |
Europe | • In March 2024, Alexion filed motions for provisional measures against Amgen Pharmaceuticals Inc (Amgen) and |
Samsung Bioepis Co. Ltd. (Samsung) and their respective affiliates at the Hamburg Local Division of the Unified | |
Patent Court (UPC) on the basis that Amgen’s and Samsung’s biosimilar eculizumab products infringe an Alexion | |
patent. Alexion appealed and in December 2024 the UPC appellate division denied Alexion’s appeal requesting | |
provisional measures. | |
• In parallel, Samsung and Amgen have filed oppositions to the patent at the European Patent Office. | |
• In November 2024, Amgen filed a revocation action for the patent at the UPC Central Division in Milan. | |
Soliris patent proceedings | Considered to be a contingent asset |
UK | • In May 2024, Alexion initiated patent infringement proceedings against Amgen Ltd and Samsung Bioepis UK Ltd |
(Samsung UK) in the UK High Court of Justice alleging that their respective biosimilar eculizumab products infringe | |
an Alexion patent; on the same day, Samsung UK initiated a revocation action for the same patent. | |
• Trial has been scheduled for March 2025. | |
Tagrisso patent proceedings | Considered to be a contingent asset |
Russia | • In Russia, in August 2023, AstraZeneca filed lawsuits in the Arbitration Court of the Moscow Region (Court) against |
the Ministry of Health of the Russian Federation and Axelpharm LLC (Axelpharm) related to Axelpharm’s improper use | |
of AstraZeneca’s information to obtain authorisation to market a generic version of Tagrisso . In December 2023, | |
the Court dismissed the lawsuit against the Ministry of Health of the Russian Federation. The appellate court affirmed | |
the dismissal in March 2024. AstraZeneca filed a further appeal, which was dismissed in July 2024. The lawsuit | |
against Axelpharm was dismissed in September 2024, and AstraZeneca appealed. | |
• In November 2023, Axelpharm filed a compulsory licensing action against AstraZeneca in the Court related to a patent | |
that covers Tagrisso . The compulsory licensing action remains pending. AstraZeneca has also challenged before the | |
Russian Patent and Trademark Office (PTO) the validity of the Axelpharm patent on which the compulsory licensing | |
action is predicated. In August 2024, the PTO determined that Axelpharm’s patent is invalid and, in November 2024, | |
Axelpharm filed an appeal. | |
• In July 2024, AstraZeneca filed a patent infringement lawsuit, which remains pending, and an unfair competition claim | |
with the Federal Anti-Monopoly Service of Russia (FAS) against AxelPharm and others related to the securing of state | |
contracts in Russia for its generic version of Osimertinib. | |
• In August 2024, the FAS initiated an unfair competition case against Axelpharm and OncoTarget based on AstraZeneca’s | |
unfair competition claim. In November 2024, the FAS determined that Axelpharm had committed unfair competition | |
and that OncoTarget had not; the FAS ordered Axelpharm to cease sales of its generic osimertinib and pay the Russian | |
government the income it received from its sales of its generic Osimertinib. In December 2024, Axelpharm appealed. |
Financial Statements
Notes to the Group Financial Statements
continued
30 Commitments, contingent liabilities and contingent assets
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
208
Product liability litigation
Legal proceedings brought against AstraZeneca
Farxiga and Xigduo XR | Considered to be a contingent liability |
US | • AstraZeneca has been named as a defendant in lawsuits involving plaintiffs claiming physical injury, including |
Fournier’s Gangrene and necrotising fasciitis, from treatment with Farxiga and/or Xigduo XR. In September 2023, | |
the parties resolved by settlement agreement one case, filed in state court in Minnesota, previously scheduled for | |
trial in October 2023. All remaining claims are filed in Delaware state court and remain pending, with the earliest | |
trial scheduled for March 2026. | |
Nexium and Prilosec | A provision has been taken |
US | • AstraZeneca has been defending lawsuits brought in federal and state courts involving claims that plaintiffs have been |
diagnosed with various injuries following treatment with proton pump inhibitors (PPIs), including Nexium and Prilosec . | |
Most of the lawsuits alleged kidney injury. | |
• In addition, AstraZeneca has been defending lawsuits involving allegations of gastric cancer following treatment with | |
PPIs, including one such claim in the US District Court for the Middle District of Louisiana (District Court). | |
• In October 2023, AstraZeneca resolved all pending claims in the MDL, as well as all pending claims in Delaware | |
and New Jersey state courts, for $425m, for which a provision has been taken. | |
• In December 2024, AstraZeneca resolved the sole remaining case, which had been pending in the District Court. | |
Nexium and Losec | Considered to be a contingent liability |
Canada | • In Canada, in July and August 2017, AstraZeneca was served with three putative class action lawsuits. Two of the |
lawsuits have been dismissed, one in 2019 and one in 2021. | |
• The third lawsuit seeks authorisation to represent individual residents in Canada who allegedly suffered kidney | |
injuries from the use of proton pump inhibitors, including Nexium and Losec . No trial date has been scheduled. | |
Onglyza and Kombiglyze | Matter concluded |
US | • In the US, AstraZeneca has been defending various lawsuits in both California state court and in a consolidated |
federal proceeding alleging heart failure, cardiac injuries, and/or death from treatment with Onglyza or Kombiglyze . | |
In the California state court proceeding, the trial court granted summary judgment for AstraZeneca, which the | |
California appellate court affirmed. The California Supreme Court has declined further review, and the California | |
matter has concluded. | |
• The consolidated federal cases were dismissed in August 2022 by the US District Court for the Eastern District of | |
Kentucky. That dismissal was affirmed by the US Court of Appeals for the Sixth Circuit in February 2024. This matter | |
is concluded. | |
Vaxzevria | Considered to be a contingent liability |
UK | • AstraZeneca is defending lawsuits in multiple jurisdictions, including the UK, involving multiple claimants alleging |
injuries following vaccination with AstraZeneca’s COVID-19 vaccine. Most of the lawsuits involve claims of thrombosis | |
with thrombocytopenia syndrome. | |
• No trial dates have been scheduled. |
Commercial litigation
Legal proceedings brought against AstraZeneca
340B Antitrust litigation | Considered to be a contingent liability |
US | • In September 2021, AstraZeneca was served with a class-action antitrust complaint filed in the US District Court for |
the Western District of New York (District Court) by Mosaic Health alleging a conspiracy to restrict access to 340B | |
discounts in the diabetes market through contract pharmacies. In September 2022, the District Court granted | |
AstraZeneca’s motion to dismiss the Complaint. In February 2024, the District Court denied Plaintiffs’ request to file | |
an amended complaint and entered an order closing the matter. | |
• In March 2024, Plaintiffs filed an appeal. | |
Amyndas Trade Secrets Litigation | Considered to be a contingent liability |
US | • AstraZeneca has been defending a matter filed by Amyndas Pharmaceuticals Member P.C. and Amyndas |
Pharmaceuticals, LLC, in the US District Court for the District of Massachusetts alleging trade secret misappropriation | |
and breach of contract claims against Alexion and Zealand Pharma U.S. Inc. related to Amyndas’ C3 inhibitor candidate. | |
• No trial date has been set. | |
Anti-Terrorism Act Civil Lawsuit | Considered to be a contingent liability |
US | • In the US, in October 2017, AstraZeneca and certain other pharmaceutical and/or medical device companies were |
named as defendants in a complaint filed in the US District Court for the District of Columbia (District Court) by US | |
nationals (or their estates, survivors, or heirs) who were killed or wounded in Iraq between 2005 and 2013. The plaintiffs | |
allege that the defendants violated the US Anti-Terrorism Act and various state laws by selling pharmaceuticals and | |
medical supplies to the Iraqi Ministry of Health. In July 2020, the District Court granted AstraZeneca’s and the other | |
defendants’ motion to dismiss the lawsuit, which the DC Circuit Court of Appeals (the Appellate Court) reversed in | |
January 2022. | |
• In June 2024, the United States Supreme Court issued an order vacating the 2022 decision and granted AstraZeneca’s | |
and the other defendants’ request for a remand to the Appellate Court for reconsideration under new case law. |
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
209
Caelum Trade Secrets Litigation | Matter concluded | |
US | • | AstraZeneca has been defending a matter filed by the University of Tennessee Research Foundation in the US District |
Court for the Eastern District of Tennessee related to CAEL-101. | ||
• | In September 2024, the parties resolved the matter by settlement. | |
Definiens | Considered to be a contingent liability | |
Germany | • | In Germany, in July 2020, AstraZeneca received a notice of arbitration filed with the German Institution of Arbitration |
from the sellers of Definiens AG (the Sellers) regarding the 2014 Share Purchase Agreement (SPA) between | ||
AstraZeneca and the Sellers. The Sellers claim that they are owed approximately $140m in earn-outs under the SPA. | ||
In December 2023, after an arbitration hearing, the arbitration panel made a final award of $46.43m in favour of | ||
the Sellers. | ||
• | In March 2024, AstraZeneca filed an application with the Bavarian Supreme Court to set aside the arbitration award. | |
• | A hearing is scheduled for February 2025. | |
Employment Litigation | Considered to be a contingent liability | |
US | • | In December 2022, AstraZeneca was served with a lawsuit filed by seven former employees in the US District Court |
for the District of Delaware (District Court) asserting claims of discrimination on grounds of age and religion, related | ||
to AstraZeneca’s vaccination requirement. In June 2024, the District Court granted AstraZeneca’s partial motion to | ||
dismiss and denied without prejudice Plaintiff’s motion for conditional certification. | ||
• | AstraZeneca is defending against numerous other litigation matters pending in federal and state courts asserting claims | |
of discrimination in connection with AstraZeneca’s vaccine requirement. In November 2024, in a matter pending in | ||
the US District Court for the Northern District of Ohio, the court entered summary judgment in favour of the plaintiff. | ||
• | A trial on the issues of damages is scheduled for June 2025. | |
Pay Equity Litigation | Considered to be a contingent liability | |
US | • | AstraZeneca is defending a putative class and collective action in the US District Court for the Northern District of |
Illinois (District Court) brought by three named plaintiffs, who are former AstraZeneca employees. The case involves | ||
claims under the federal and Illinois Equal Pay Acts, with the plaintiffs alleging they were paid less than male | ||
employees who performed substantially similar and/or equal work. | ||
• | In May 2024, the District Court conditionally certified a collective under the federal Equal Pay Act and authorised the | |
sending of notice to potential collective action members. The notice was distributed in June 2024. | ||
Securities Litigation | Considered to be a contingent liability | |
US | • | In December 2024, a putative securities class action lawsuit was filed in the US District Court for the Central District |
of California against AstraZeneca PLC and certain officers, on behalf of purchasers of AstraZeneca publicly traded | ||
securities between February 2022 and December 2024. The complaint alleges that defendants made materially | ||
false and misleading statements in connection with the Company’s business in China. | ||
Seroquel XR Antitrust Litigation | Considered to be a contingent liability | |
US | • | In 2019, AstraZeneca was named in several related complaints now proceeding in US District Court in Delaware |
(District Court), including several putative class action lawsuits that were purportedly brought on behalf of classes | ||
of direct purchasers or end payors of Seroquel XR , that allege AstraZeneca and generic drug manufacturers violated | ||
US antitrust laws when settling patent litigation related to Seroquel XR . | ||
• | In July 2022, the District Court dismissed claims relating to one of the generic manufacturers while allowing claims | |
relating to the second generic manufacturer to proceed. | ||
• | In September 2024, AstraZeneca reached a settlement agreement with one of the plaintiff classes and the parties | |
are now seeking judicial review and approval of the settlement. | ||
• | Trial with the remaining class of plaintiffs is currently scheduled for May 2025. | |
Syntimmune Milestone Litigation | Considered to be a contingent liability | |
US | • | In connection with Alexion’s acquisition of Syntimmune, Inc. (Syntimmune) in December 2020, Alexion was served |
with a lawsuit filed by the stockholders’ representative for Syntimmune in Delaware state court that alleged, among | ||
other things, breaches of the 2018 merger agreement (Merger Agreement). | ||
• | The stockholders’ representative alleges that Alexion failed to meet its obligations under the Merger Agreement to use | |
commercially reasonable efforts to achieve the milestones. Alexion also filed a claim for breach of the representations | ||
in the Merger Agreement. | ||
• | A trial was held in July 2023. | |
• | The court issued a partial decision in September 2024, concluding that the first milestone was achieved, and that | |
Alexion had breached its contractual obligation to use commercially reasonable efforts to achieve the milestones. | ||
The court has requested additional briefing regarding damages and further proceedings regarding Alexion’s claim | ||
for breach. | ||
University of Sheffield | Considered to be a contingent liability | |
Contract Dispute | ||
UK | • | In June 2024, AstraZeneca was served with a lawsuit filed by the University of Sheffield (Sheffield). In its complaint, |
Sheffield alleges that AstraZeneca made misrepresentations to induce Sheffield to amend a patent license relating | ||
to Lynparza . | ||
• | AstraZeneca filed its defence in August 2024. No trial date has been scheduled. | |
Financial Statements
Notes to the Group Financial Statements
continued
30 Commitments, contingent liabilities and contingent assets
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
210
Viela Bio, Inc. Shareholder Litigation | Considered to be a contingent liability | |
US | • | In February 2023, AstraZeneca was served with a lawsuit filed in the Delaware state court against AstraZeneca |
and certain officers (collectively, Defendants), on behalf of a putative class of Viela Bio, Inc. (Viela) shareholders. | ||
The complaint alleged that the Defendants breached their fiduciary duty to Viela shareholders in the course of | ||
Viela’s 2021 merger with Horizon Therapeutics, plc. | ||
• | In July 2024, the Court granted with prejudice AstraZeneca’s motion to dismiss. | |
• | In August 2024, plaintiffs appealed the dismissal. | |
Legal proceedings brought by AstraZeneca | ||
PARP Inhibitor Royalty Dispute | Considered to be a contingent asset | |
UK | • | In October 2012, Tesaro, Inc. (now wholly owned by GlaxoSmithKline plc (GSK)) entered into two worldwide, royalty- |
bearing patent license agreements with AstraZeneca related to GSK’s product niraparib. In May 2021, AstraZeneca | ||
filed a lawsuit against GSK in the Commercial Court of England and Wales alleging that GSK had failed to pay all of | ||
the royalties due on niraparib sales under the license agreements. In April 2023, after trial, the trial court issued a | ||
decision in AstraZeneca’s favour. In February 2024, the Court of Appeal reversed the decision. In March 2024, | ||
AstraZeneca filed a request for permission to appeal with the Supreme Court of the United Kingdom. | ||
• | In May 2024, the Supreme Court denied permission to appeal. The case will return to the trial court for | |
further proceedings. | ||
Government investigations and proceedings | ||
Legal proceedings brought against AstraZeneca | ||
340B Qui Tam | Considered to be a contingent liability | |
US | • | In July 2023, AstraZeneca was served with an unsealed civil lawsuit brought by a qui tam relator on behalf of the |
United States, several states, and the District of Columbia in the US District Court for the Central District of California | ||
(District Court). The complaint alleges that AstraZeneca violated the US False Claims Act and state law analogues. | ||
In March 2024, the District Court granted AstraZeneca’s motion to dismiss the First Amended Complaint without | ||
leave to amend. | ||
• | In April 2024, the relator filed an appeal. | |
Boston US Attorney Investigation | Considered to be a contingent liability | |
US | • | In June 2024, AstraZeneca was served with a subpoena issued by the US Attorney’s Office in Boston, seeking |
documents and information relating to payments by AstraZeneca to healthcare providers. | ||
• | AstraZeneca is cooperating with this enquiry. | |
Brazilian Tax Assessment Matter | Considered to be a contingent liability | |
Brazil | • | In connection with an ongoing matter, in August 2019, the Brazilian Federal Revenue Service provided a Notice of Tax |
and Description of the Facts (the Tax Assessment) to two Alexion subsidiaries in Brazil, as well as to two additional | ||
entities, a logistics provider utilised by Alexion and a distributor. The Tax Assessment focuses on the importation of | ||
Soliris vials pursuant to Alexion’s free drug supply to patients programme in Brazil. | ||
• | Alexion prevailed in the first level of administrative appeals in the Brazilian federal administrative proceeding system | |
based on a deficiency in the Brazil Tax Assessment. The decision was subject to an automatic appeal to the second | ||
level of the administrative courts. | ||
• | In March 2023, the second level of the administrative courts issued a decision to remand the matter to the first level | |
of administrative courts for a determination on the merits. | ||
Texas Qui Tam | Considered to be a contingent liability | |
US | • | In December 2022, AstraZeneca was served with an unsealed civil lawsuit brought by qui tam relators on behalf of |
the State of Texas in Texas state court, which alleges that AstraZeneca engaged in unlawful marketing practices. | ||
• | Trial is scheduled for October 2025. | |
Turkish Ministry of Health Matter | Matter concluded | |
Turkey | • | In Turkey, in July 2020, the Turkish Ministry of Health (Ministry of Health) initiated an investigation regarding payments |
to healthcare providers by Alexion and former employees and consultants. The investigation arose from Alexion’s | ||
disclosure of a $21.5m civil settlement with the US Securities & Exchange Commission (SEC) in July 2020 fully | ||
resolving the SEC’s investigation into possible violations of the US Foreign Corrupt Practices Act. | ||
• | In September 2021, the Ministry of Health completed its draft investigation report and referred the matter to the | |
Ankara Public Prosecutor’s Office with a recommendation for further proceedings against certain former employees. | ||
In June 2024, the Ankara Public Prosecutor’s Office closed its investigation without further action. This matter is | ||
now concluded. | ||
US Congressional Inquiry | Matter concluded | |
US | • | In January 2024, AstraZeneca received a letter from the US Senate Committee on Health, Education, Labor and |
Pensions (HELP Committee) seeking information related to AstraZeneca’s inhaled Respiratory products. | ||
• | AstraZeneca cooperated with this inquiry and this matter is now concluded. | |
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
211
Vermont US Attorney Investigation | Considered to be a contingent liability | |
US | • | In April 2020, AstraZeneca received a Civil Investigative Demand from the US Attorney’s Office in Vermont and the |
Department of Justice, Civil Division, seeking documents and information relating to AstraZeneca’s relationships with | ||
electronic health-record vendors. | ||
• | AstraZeneca continues to cooperate with this enquiry. | |
Shenzhen City Customs Office | Considered to be a contingent liability | |
China | • | In relation to the illegal drug importation allegations, in January 2025, AstraZeneca received a Notice of Transfer to the |
Prosecutor and an Appraisal Opinion from the Shenzhen City Customs Office regarding suspected unpaid importation | ||
taxes amounting to $0.9m. | ||
• | To the best of AstraZeneca’s knowledge, the importation taxes referred to in the Appraisal Opinion relate to Imfinzi | |
and Imjudo . | ||
• | A fine of between one and five times the amount of unpaid importation taxes may also be levied if AstraZeneca is | |
found liable. | ||
Legal proceedings brought by AstraZeneca | ||
340B State Litigation | Considered to be a contingent asset | |
US | • | AstraZeneca has filed lawsuits against Arkansas, Kansas, Louisiana, Maryland, Minnesota, Mississippi, Missouri, |
and West Virginia challenging the constitutionality of each state’s 340B statute. | ||
• | In the Arkansas matter, trial is scheduled for April 2025. In the Arkansas administrative proceeding, the state has | |
moved for a preliminary injunction to enjoin AstraZeneca’s 340B policy in Arkansas. | ||
• | In the Kansas matter, after obtaining a stipulation from the state that AstraZeneca’s policy does not violate the | |
Kansas 340B statute, AstraZeneca agreed to dismiss its complaint. | ||
• | In the Louisiana matter, the Court granted the state’s motion for summary judgment. AstraZeneca has filed an appeal. | |
• | In the Maryland, Minnesota, and Missouri matters, the state has moved to dismiss AstraZeneca’s complaint. | |
• | In the Maryland and Mississippi matters, the Court has rejected AstraZeneca’s preliminary injunction motion. | |
• | The West Virginia matter remains in its preliminary stages. | |
Inflation Reduction Act Litigation | Considered to be a contingent asset | |
US | • | In August 2023, AstraZeneca filed a lawsuit in the US District Court for the District of Delaware (District Court) against |
the US Department of Health and Human Services (HHS) challenging aspects of the drug price negotiation provisions | ||
of the Inflation Reduction Act and the implementing guidance and regulations. In March 2024, the District Court granted | ||
HHS’ motions and dismissed AstraZeneca’s lawsuit. | ||
• | AstraZeneca has appealed the District Court’s decision. | |
Other
Additional government inquiries
As is true for most, if not all, major prescription pharmaceutical companies, AstraZeneca is currently involved in multiple inquiries into drug
marketing and pricing practices. In addition to the investigations described above, various law enforcement offices have, from time to time,
requested information from the Group. There have been no material developments in those matters.
Tax
AstraZeneca considers whether it is probable that a taxation authority will accept an uncertain tax treatment. Where it is concluded that it is
not probable the taxation authority will accept an uncertain tax treatment, a tax liability is recognised based on either the most likely amount
method or the expected value method depending on which method management expects to better predict the resolution of the uncertainty.
Tax liabilities for uncertain tax treatments can be built up over a long period of time but the resolution of the uncertain tax treatments usually
occurs at a point in time. Given the inherent uncertainties in assessing the outcomes (which can sometimes be binary), the probability and
amount of any tax liability occurring are difficult to ascertain which may see adjustments to the liabilities recognised for uncertain tax
treatments in future periods that could have a material positive or negative effect on our results. Details of the movements in relation to
material uncertain tax treatments are discussed below.
KJ
AstraZeneca faces a number of audits and reviews in jurisdictions around the world and, in some cases, is in dispute with the tax
authorities. The issues under discussion are often complex and can require many years to resolve. Tax liabilities recognised for uncertain
tax treatments require management to make key judgements with respect to the outcome of current and potential future tax audits, and
actual results could vary from these estimates. Management does not believe a significant risk exists of material change to uncertain tax
positions in the next 12 months.
The total net tax liability recognised in the Group Financial Statements in respect of uncertain tax positions is $1,321m (2023: $1,336m;
2022: $830m) as explained below. The net tax liability consists of $1,157m (2023: $1,241m; 2022: $632m) included within income tax payable,
$1,304m (2023: $441m; 2022: $291m) included within deferred tax asset, partially offset by $122m (2023: $9m; 2022: $(20)m) included within
deferred tax liabilities, and $1,018m (2023: $337m; 2022: $113m) included within income tax receivable.
Financial Statements
Notes to the Group Financial Statements
continued
30 Commitments, contingent liabilities and contingent assets
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
212
Transfer pricing
The net tax liability included in the Group Financial Statements in relation to management’s current assessment of tax risks in relation to
worldwide transfer pricing exposures is $384m (2023: $401m; 2022: $260m). The decrease in the net tax liability for uncertain tax positions
relating to transfer pricing of $17m compared with 2023 is mainly as a result of a decrease of tax liabilities arising from updates to estimates
of prior period tax liabilities following progression of tax authority reviews.
The liability includes uncertain tax treatments which are estimated using the expected value method and depend on AstraZeneca’s
assessment of the likelihood of the approach taken by the tax authorities. These matters can be complex and judgemental and could change
in the future to reflect progress in tax authority reviews, the extent that any tax authority challenge is concluded including via negotiation
between governments under competent authority procedures in relevant double tax treaties which can take many years to resolve, or matters
lapse including following expiry of the relevant statutes of limitation. Depending upon progress in these matters, we could experience
adjustments to the liabilities recognised in respect of uncertain tax treatments in future periods. Whilst it is impracticable to specify the possible
effects of such changes at this stage, it is reasonably possible that an adjustment to the carrying amounts of tax assets and liabilities could
be required within the next financial year.
For transfer pricing matters, including items under tax audit, AstraZeneca estimates the potential for additional tax liabilities above the amount
provided where the possibility of the additional liabilities falling due is more than remote, to be up to $422m (2023: $386m; 2022: $245m)
including associated interest.
Management believes that it is unlikely that these additional liabilities will arise. It is possible that some of these contingencies may change in
the future to reflect progress in tax authority reviews, to the extent that any tax authority challenge is concluded or matters lapse including
following expiry of the relevant statutes of limitation resulting in a reduction in the tax charge in future periods. Management continues to
believe that AstraZeneca’s positions on all its transfer pricing positions, audits and disputes are robust, and that AstraZeneca has recognised
appropriate tax balances, including consideration of whether corresponding relief will be available under Mutual Agreement procedures
or unilaterally.
Other uncertain tax treatments
Included in the net tax liability is $937m (2023: $935m; 2022: $570m) relating to a number of other uncertain tax treatments. The increase
of $2m in the net tax liability relating to the other uncertain tax treatments mainly relates to an update to tax liabilities following progress of
reviews by tax authorities and administrative appeal processes which are offset by movements relating to uncertainty over the timing of tax
deductions. This uncertainty includes movements between income taxes receivable of $742m, and deferred tax liabilities of $133m offset
by related deferred tax assets of $929m and income taxes payable of $269m. The liability includes tax liabilities in respect of uncertain
tax treatments which are estimated using the most likely amount method and the expected value method and depend on AstraZeneca’s
assessment of the likelihood of the approach taken by the tax authorities. This could change in the future to reflect progress in tax authority
reviews, the extent that any tax authority challenge is concluded, or matters lapse including following expiry of the relevant statutes of
limitation resulting in a reduction in the tax charge in future periods.
For these other tax liabilities in respect of uncertain tax treatments, AstraZeneca estimates the potential for additional liabilities above the
amount provided where the possibility of the additional liabilities falling due is more than remote, to be up to $214m (2023: $293m; 2022:
$209m) including associated interest. It is possible that some of these liabilities may reduce in the future if any tax authority challenge is
concluded or matters lapse following expiry of the relevant statutes of limitation, resulting in a reduction in the tax charge in future periods.
AstraZeneca does not believe there are any significant other uncertain tax treatments where the possibility of the additional liabilities falling
due is more than remote (2023: $nil; 2022: $280m).
The Group is currently under audit in several countries and the timing of any resolution of these audits is uncertain.
It is anticipated that tax payments may be required in relation to a number of significant disputes which may be resolved over the next one to
two years. AstraZeneca considers the tax liabilities set out above to appropriately reflect the expected value of any final settlement. Some
of the items discussed above are not currently within the scope of tax authority audits and may take longer to resolve.
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Group Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
213
31 Statutory and other information
2024 |
2023 |
2022 |
|
$m |
$m |
$m |
|
Fees payable to PricewaterhouseCoopers LLP and its associates: |
|||
Group audit fee |
10.6 |
10.2 |
9.9 |
Fees payable to PricewaterhouseCoopers LLP and its associates for other services: |
|||
The audit of subsidiaries pursuant to legislation |
14.8 |
15.0 |
15.1 |
Attestation under s404 of Sarbanes-Oxley Act 2002 |
3.5 |
3.3 |
3.1 |
Audit-related assurance services |
2.2 |
1.1 |
0.7 |
Other assurance services |
0.3 |
0.2 |
0.2 |
Fees payable to PricewaterhouseCoopers Associates in respect of the Group’s pension schemes: |
|||
The audit of subsidiaries’ pension schemes |
0.4 |
0.3 |
0.3 |
31.8 |
30.1 |
29.3 |
The Group had no material related party transactions which might reasonably be expected to influence decisions made by the users of these
Key management personnel are defined for the purpose of disclosure under IAS 24 ‘Related Party Disclosures’ as the members of the Board
and the members of the SET.
2024 |
2023 |
2022 |
|
$’000 |
$ʼ000 |
$ʼ000 |
|
Short-term employee benefits |
40,893 |
38,636 |
38,632 |
Post-employment benefits |
1,045 |
1,354 |
1,388 |
Share-based payments |
49,121 |
58,242 |
56,297 |
91,059 |
98,232 |
96,317 |
Financial Statements
In accordance with section 409 of the Companies Act 2006, a full list of subsidiaries, partnerships, associates, joint ventures and joint
arrangements, the place of incorporation, registered office address, and the effective percentage of equity owned as at 31 December 2024
are disclosed below. Unless otherwise stated, the share capital disclosed comprises ordinary shares which are indirectly held by AstraZeneca PLC.
Unless otherwise stated, the accounting year ends of subsidiaries are 31 December. The Group Financial Statements consolidate the
Financial Statements of the Company and its subsidiaries at 31 December 2024.
At 31 December 2024 | Group Interest |
Wholly owned subsidiaries | |
Algeria | |
AAPM SARL | 100% |
20, Zone Macro-Economique, Hydra, | |
Dar El Medina, Algiers, Algeria | |
Argentina | |
AstraZeneca S.A. | 100% |
Olga Cossettini 363, 3° floor, | |
Buenos Aires, Argentina | |
Alexion Pharma Argentina SRL | 100% |
Avenida Leandro N. Alem 592 Piso 6, | |
Buenos Aires, Argentina | |
Australia | |
AstraZeneca Holdings Pty Limited | 100% |
AstraZeneca Pty Limited | 100% |
Alexion Pharmaceuticals Australasia Pty Ltd | 100% |
66 Talavera Road, Macquarie Park, | |
NSW 2113, Australia | |
LogicBio Australia Pty Limited | 100% |
Level 40, 2-26 Park Street, Sydney, | |
NSW 2000, Australia | |
Austria | |
AstraZeneca Österreich GmbH | 100% |
Alexion Pharma Austria GmbH | 100% |
Rechte Wienzeile 223 1120 Wien, Austria | |
Portola Österreich GmbH (in liquidation) | 100% |
Mooslackengasse 17, 1190 Wien, Austria | |
Belgium | |
AstraZeneca S.A. / N.V. | 100% |
Alfons Gossetlaan 40 bus 201 at | |
1702 Groot-Bijgaarden, Belgium | |
Alexion Pharma Belgium Sprl | 100% |
Alexion Services Europe Sprl | 100% |
Rue des Deux Eglises 29-33, | |
1000 Brussels, Belgium | |
Bermuda | |
Alexion Bermuda Holding ULC | 100% |
Alexion Bermuda Limited | 100% |
Alexion Bermuda Partners LP | 100% |
Victoria Place, 5th Floor, 31 Victoria Street, | |
Hamilton, HM 10, Bermuda | |
Brazil | |
AstraZeneca do Brasil Limitada | 100% |
Rod. Raposo Tavares, KM 26, 9, Cotia, Brazil | |
Alexion Farmacêutica América Latina | 100% |
Serviços de Administração de Vendas Ltda. | |
Alexion Serviços e Farmacêutica | 100% |
do Brasil Ltda. | |
Av. Dr Chucri Zaidan, 1240, 15° andar, | |
CEP 04711-130, Ed. Morumbi Corporate | |
– Golden Tower Vila São Francisco, | |
São Paulo, Brazil |
At 31 December 2024 | Group Interest |
British Virgin Islands | |
Gracell Biotechnologies Holdings Limited | 100% |
Office of Sertus Incorporations (BVI) Limited, | |
Sertus Chambers, P.O. Box 905, | |
Quastisky Building, Road Town, Tortola, | |
British Virgin Islands | |
Bulgaria | |
AstraZeneca Bulgaria EOOD | 100% |
51 Cherni Vrah Bld., Business Garden Office X, | |
floor 10, Lozenets district, 1407 Sofia, Bulgaria | |
Canada | |
AstraZeneca Canada Inc. 1 | 100% |
Evinova Canada Inc. | 100% |
Suite 5000, 1004 Middlegate Road, | |
Mississauga, ON, L4Y 1M4, Canada | |
Alexion Pharma Canada Corporation | 100% |
Suite 1300, 1969 Upper Water St, Halifax, | |
NS, B3J 3R7, Canada | |
Fusion Pharmaceuticals Inc. | 100% |
270 Longwood Road South, Hamilton, | |
ON, L8P 0A6, Canada | |
Cayman Islands | |
AZ Reinsurance Limited | 100% |
18 Forum Lane, 2nd Floor, Camana Bay, | |
Grand Cayman, P.O. Box 69, Cayman Islands | |
Gracell Biotechnologies Inc. | 100% |
P.O. Box 309, Ugland House, Grand Cayman, | |
KY1-1104, Cayman Islands | |
Chile | |
AstraZeneca S.A. | 100% |
AstraZeneca Farmaceutica Chile Limitada | 100% |
Av. Isidora Goyenechea 3477, 2nd Floor, | |
Las Condes, Santiago, Chile | |
China | |
Alexion Pharmaceuticals | 100% |
(Shanghai) Company Limited | |
Room 1703, Level 17, No. 88 Xizang North Road, | |
Jing’an District, Shanghai, China | |
AstraZeneca Global R&D (China) Co., Ltd. | 100% |
16F, 88 Xizang North Road, Jing’an District, | |
Shanghai, China | |
AstraZeneca Investment (China) Co., Ltd. | 100% |
199 Liangjing Road, Pilot Free Trade Zone, | |
Shanghai, China | |
AstraZeneca Investment Consulting | 100% |
(Wuxi) Co., Ltd. | |
Room 808, 8F, Building 99-2 Linghu Avenue, | |
Xinwu District, Wuxi, Jiangsu, China | |
AstraZeneca Pharmaceutical Co., Ltd. | 100% |
No. 2, Huangshan Road, Wuxi, | |
Jiangsu Province, China | |
AstraZeneca Pharmaceutical (Beijing) Co., Ltd. | 100% |
1F, Building No. 4, No. 8 Courtyard, No. 1 | |
Kegu Street, Beijing Economic-Technological | |
Development Area, Beijing, China |
At 31 December 2024 | Group Interest |
AstraZeneca Pharmaceutical | 100% |
(Chengdu) Co., Ltd. | |
10th Floor, Building 11 (Building E11), No. 366, | |
Hemin Street, Chengdu High-tech Zone, | |
China (Sichuan) Pilot Free Trade Zone, China | |
AstraZeneca Pharmaceutical | 100% |
(Guangzhou) Co., Ltd. | |
Room 406-178, No. 1, Yichuang Street, | |
(China-Singapore Guangzhou Knowledge City) | |
Huangpu District, Guangzhou City, China | |
AstraZeneca Pharmaceutical | 100% |
(Hangzhou) Co., Ltd. | |
12F & 14F, Building 1, Shuli Plaza, | |
758 Fei Jia Tang Road, Gongshu District, | |
Hangzhou, Zhejiang Province, China | |
AstraZeneca Pharmaceutical Manufacturing | 100% |
(Qingdao) Co., Ltd. | |
Room 806, Building 2, 82 Juxianqiao Road, | |
High-tech Zone, Qingdao, | |
Shandong Province, China | |
AstraZeneca Pharmaceutical | 100% |
(Qingdao) Co., Ltd. | |
Floor 8, Building 2, 82 Juxianqiao Road, | |
High-tech Zone, Qingdao, | |
Shandong Province, China | |
AstraZeneca Pharmaceutical | 100% |
(Shanghai) Co., Ltd. | |
B1F, 8F & 9F, 88 Xizang North Road, | |
Jing’an District, Shanghai, China | |
AstraZeneca Pharmaceuticals (China) Co., Ltd. | 100% |
88 Yaocheng Avenue, Jiangsu Province, | |
Taizhou, China | |
AstraZeneca (Wuxi) Trading Co., Ltd. | 100% |
Building E (Building No. 5), | |
Huirong Commercial Plaza, East Jinghui Road, | |
Xinwu District, Wuxi, China | |
Gracell Biomedicine (Shanghai) Co., Ltd. 2 | 100% |
Shanghai Evinova Medical | 100% |
Technology Co., Ltd. 2 | |
Building C, No. 888, Huanhu 2nd Road West, | |
Lingang New District, Shanghai, | |
Pilot Free Trade Zone, China | |
Gracell Bioscience (Shanghai) Co., Ltd. | 100% |
1st-4th Floor, Building 1, No. 418 Guilin Road, | |
Xuhui District, Shanghai 200233, China | |
Hainan Gracell Biomedicine Co., Ltd. | 100% |
(in liquidation) 2 | |
A132-81, 4th Floor, Joint Inspection Building, | |
Haikou Comprehensive Bonded Zone, | |
Haikou Free Trade Zone, | |
Hainan Province, China | |
Suzhou Gracell Bioscience Co., Ltd. | 100% |
Unit E547, 5th Floor, Lecheng Plaza, Phase II, | |
Biobay Industrial Park, 218 Sangtian Street, | |
Suzhou Industrial Park, Suzhou Area, Jiangsu, | |
Pilot Free Trade Zone 215123, China |
AstraZeneca
Annual Report & Form 20-F Information 2024
214
Strategic Report
Corporate Governance
Financial Statements
Additional Information
At 31 December 2024 |
Group Interest |
Colombia |
|
AstraZeneca Colombia S.A.S. |
100% |
Av Carrera 9 No. 101-67 Office 601, |
|
Bogotá, 110231, Colombia |
|
Alexion Pharma Colombia S.A.S. |
100% |
(in liquidation) |
|
Carrera 9 No. 115 - 06 /30 Edificio Tierra |
|
Firme Oficina 2904 Bogotá D.C., Colombia |
|
Costa Rica |
|
AstraZeneca CAMCAR Costa Rica, S.A. |
100% |
San José, Escazú, Roble Corporate Center, |
|
5to piso, Costa Rica |
|
Croatia |
|
AstraZeneca d.o.o. |
100% |
Vjekoslava Heinzela 70, |
|
10 000 Zagreb, Croatia |
|
Czech Republic |
|
AstraZeneca Czech Republic, s.r.o. |
100% |
Alexion Pharma Czech s.r.o. |
100% |
U Trezorky 921/2, 158 00 Prague 5, |
|
Czech Republic |
|
Denmark |
|
AstraZeneca A/S |
100% |
Johanne Møllers Passage 1, Dk-1799, |
|
Copenhagen V, Denmark |
|
Egypt |
|
AstraZeneca Egypt for |
100% |
Pharmaceutical Industries SAE |
|
6th of October City, 6th Industrial Zone, |
|
Plot 2, Giza, Egypt |
|
AstraZeneca Egypt LLC |
100% |
47 St. 270 New Maadi, Cairo, Egypt |
|
Drimex LLC |
100% |
Plot 133, Banks’ District, 5th Settlement, |
|
New Cairo, Cairo, Egypt |
|
Estonia |
|
AstraZeneca Eesti OÜ |
100% |
Harju maakond, Tallinn, Lasnamäe linnaosa, |
|
Valukoja tn 8/1, 11415, Estonia |
|
Finland |
|
AstraZeneca Oy. |
100% |
Keilaranta 18, 02150 Espoo, Finland |
|
France |
|
Amolyt Pharma SAS 3 |
100% |
15 Chemin du Saquin, Espace Européen, |
|
69130 Écully, France |
|
AstraZeneca SAS |
100% |
Tour Carpe Diem-31, Place des Corolles, |
|
92400 Courbevoie, France |
|
AstraZeneca Reims Production SAS |
100% |
Chemin de Vrilly Parc, Industriel de la Pompelle, |
|
51100 Reims, France |
|
AstraZeneca Dunkerque Production SCS |
100% |
224 Avenue de la Dordogne, |
|
59640 Dunkerque, France |
|
Alexion Europe SAS |
100% |
Alexion Pharma France SAS |
100% |
103-105 Rue Anatole France, |
|
92300 Levallois-Perret, France |
At 31 December 2024 |
Group Interest |
Germany |
|
AstraZeneca GmbH |
100% |
AstraZeneca Holding GmbH 4 |
100% |
Sofotec GmbH 5 |
100% |
Friesenweg 26, 22763, Hamburg, Germany |
|
AstraZeneca Computational Pathology GmbH 3 |
100% |
Bernhard-Wicki-Straße 5, 80636, |
|
Munich, Germany |
|
Alexion Pharma Germany GmbH |
100% |
Landsberger Straße 300, 80687, |
|
Munich, Germany |
|
Greece |
|
AstraZeneca S.A. |
100% |
Agisilaou 6-8 Marousi, Athens, Greece |
|
Hong Kong |
|
AstraZeneca HK Holdings Company Limited |
100% |
AstraZeneca Hong Kong Limited |
100% |
Unit 1 – 3, 11/F., China Taiping Finance Centre, |
|
18 King Wah Road, North Point, Hong Kong |
|
Gracell Biotechnologies (HK) Limited |
100% |
C&F Secretarial Services Limited, Unit 3A, |
|
12/F, Kaiser Centre, No. 18 Centre Street, |
|
Sai Ying Pun, Hong Kong |
|
Hungary |
|
AstraZeneca Kft |
100% |
1st floor, 4 building B, Alíz str., |
|
Budapest, 1117, Hungary |
|
India |
|
AstraZeneca India Private Limited 6 |
100% |
Block A, Neville Tower, 11th Floor, Ramanujan |
|
IT SEZ, Taramani, Chennai, Tamil Nadu, |
|
PIN 600113, India |
|
Alexion Business Services Private Limited |
100% |
9th Floor, Platina, G Block Plot No. C-59, |
|
Bandra-Kurla Complex Bandra (East), |
|
Mumbai 400051, India |
|
Iran |
|
AstraZeneca Pars Company |
100% |
Suite 1, 1st Floor No. 39, Alvand Ave., |
|
Argantin Sq., Tehran 1516673114, Iran |
|
Ireland |
|
AstraZeneca Pharmaceuticals (Ireland) |
100% |
Designated Activity Company |
|
4th Floor, South Bank House, Barrow Street, |
|
Dublin 4, Republic of Ireland |
|
Alexion Pharma Holding Limited |
100% |
Alexion Pharma International |
100% |
Operations Limited |
|
Alexion Pharma Development Limited |
100% |
AstraZeneca Ireland Limited |
100% |
College Business & Technology Park, |
|
Blanchardstown Road North, Dublin 15, |
|
Republic of Ireland |
|
Israel |
|
AstraZeneca (Israel) Ltd |
100% |
Atirei Yeda 1, Building O-Tech 2, POB 8044, |
|
Kfar Saba, 4464301, Israel |
|
Alexion Pharma Israel Ltd |
100% |
16 Derech Aba Hille St., |
|
Ramat Gan 5250608, Israel |
At 31 December 2024 |
Group Interest |
Italy |
|
Simesa SpA |
100% |
AstraZeneca SpA |
100% |
Alexion Pharma Italy Srl |
100% |
Viale Decumano 39, 20157 Milan, Italy |
|
Japan |
|
AstraZeneca K.K. |
100% |
3-1, Ofuka -cho, Kita-ku, Osaka, |
|
530-0011, Japan |
|
Alexion Pharma GK |
100% |
Tamachi Station Tower N 3-1-1, Shibaura, |
|
Minato-ku Tokyo 108 -0023, Japan |
|
Kazakhstan |
|
AstraZeneca Kazakhstan Limited |
100% |
Liability Partnership |
|
Office 101, 77 Kunayev Street, |
|
Almaty 050000, Kazakhstan |
|
Kenya |
|
AstraZeneca Pharmaceuticals Limited |
100% |
L.R. No.1/1327, Avenue 5, 1st Floor, |
|
Rose Avenue, Nairobi, Kenya |
|
Latvia |
|
AstraZeneca Latvija SIA |
100% |
Skanstes iela 50, Riga, LV-1013, Latvia |
|
Lithuania |
|
AstraZeneca Lietuva UAB |
100% |
Spaudos g., Vilnius, LT-05132, Lithuania |
|
Luxembourg |
|
AstraZeneca Luxembourg S.A. |
100% |
Rue Nicolas Bové 2A – L-1253, Luxembourg |
|
Malaysia |
|
AstraZeneca Asia-Pacific |
100% |
Business Services Sdn Bhd |
|
12th Floor, Menara Symphony, No. 5 Jalan Prof, |
|
Khoo Kay Kim, Seksyen 13, 46200 Petaling |
|
Jaya, Selangor Darul Ehsan, Malaysia |
|
AstraZeneca Sdn Bhd |
100% |
Nucleus Tower, Level 11 & 12, No. 10 Jalan |
|
PJU 7/6, Mutiara Damansara, 47800 Petaling |
|
Jaya, Selangor Darul Ehsan, Malaysia |
|
Mexico |
|
AstraZeneca Health Care Division, S.A. de C.V. |
100% |
AstraZeneca, S.A. de C.V. |
100% |
Av. Periferico Sur 4305 interior 5, Colonia |
|
Jardines en la Montaña, Mexico City, |
|
Tlalpan Distrito Federal, CP 14210, Mexico |
|
Alexion Pharma Mexico S. de R.L. de C.V. |
100% |
Paseo de los Tamarindos 90, Torre 1 piso 6 |
|
- A Col., Bosques de la Lomas, CP 05120 |
|
D.F, Mexico |
|
Morocco |
|
AstraZeneca Maroc SARLAU |
100% |
CFC (Casablanca Finance City), Le Continental |
|
Business Center, Bâtiment C, 7ème étage, |
|
Quartier Hay Hassani, Casablanca, Morocco |
Group Subsidiaries and Holdings
AstraZeneca
Annual Report & Form 20-F Information 2024
215
Financial Statements
Group Subsidiaries and Holdings
continued
At 31 December 2024 |
Group Interest |
The Netherlands |
|
Alexion Holding B.V. |
100% |
Alexion Pharma Foreign Holdings, B.V. |
100% |
Alexion Pharma Netherlands B.V. |
100% |
AstraZeneca B.V. |
100% |
AstraZeneca Continent B.V. |
100% |
AstraZeneca Gamma B.V. |
100% |
AstraZeneca Holdings B.V. |
100% |
AstraZeneca Jota B.V. |
100% |
AstraZeneca Rho B.V. |
100% |
AstraZeneca Sigma B.V. |
100% |
AstraZeneca Treasury B.V. |
100% |
AstraZeneca Zeta B.V. |
100% |
Prinses Beatrixlaan 582, 2595 BM, |
|
The Hague, The Netherlands |
|
AstraZeneca Nijmegen B.V. |
100% |
Lagelandseweg 78, 6545 CG |
|
Nijmegen, The Netherlands |
|
Acerta Pharma B.V. |
100% |
Aspire Therapeutics B.V. |
100% |
Kloosterstraat 9, 5349 AB, |
|
Oss, The Netherlands |
|
Portola Netherlands B.V. |
100% |
Basisweg 10, 1043 AP, |
|
Amsterdam, The Netherlands |
|
Neogene Therapeutics B.V. |
100% |
Science Park 106, 1098 XG |
|
Amsterdam, The Netherlands |
|
New Zealand |
|
AstraZeneca Limited |
100% |
Pharmacy Retailing (NZ) Limited t/a |
|
Healthcare Logistics, 58 Richard Pearse Drive, |
|
Mangere, Auckland, 1142, New Zealand |
|
Nigeria |
|
AstraZeneca Nigeria Limited |
100% |
11A, Alfred Olaiya Street, Awuse Estate, |
|
Off Salvation Street, Opebi, Ikeja, |
|
Lagos, Nigeria |
|
Norway |
|
AstraZeneca AS |
100% |
Karvesvingen 7, 0579 Oslo, Norway |
|
Pakistan |
|
AstraZeneca Pharmaceuticals Pakistan |
100% |
(Private) Limited 7 |
|
Office No 1, 2nd Floor, Sasi Arcade, Block 7, |
|
Main Clifton Road, Karachi, Pakistan |
|
Panama |
|
AstraZeneca CAMCAR, S.A. |
100% |
Bodega #1, Parque Logistico MIT, |
|
Carretera Hacia Coco Solo, Colon, Panama |
|
Peru |
|
AstraZeneca Peru S.A. |
100% |
Calle Las Orquídeas N° 675, Int. 802, |
|
Edificio Pacific Tower, San Isidro, Lima, Peru |
|
Philippines |
|
AstraZeneca Pharmaceuticals (Phils.) Inc. |
100% |
16th Floor, Inoza Tower, 40th Street, |
|
Bonifacio Global City, Taguig 1634, Philippines |
At 31 December 2024 |
Group Interest |
Poland |
|
AstraZeneca Pharma Poland Sp.z.o.o. |
100% |
Alexion Pharma Poland Sp.z.o.o. |
100% |
Postepu 14, 02-676, Warszawa, Poland |
|
Evinova Poland sp. z o.o |
100% |
Towarowa 28, 00-839 Warszawa, Poland |
|
Portugal |
|
Astra Alpha Produtos Farmacêuticos Lda |
100% |
AstraZeneca Produtos Farmacêuticos Lda |
100% |
Novastra Promoção e Comércio |
100% |
Farmacêutico Lda |
|
Novastuart Produtos Farmacêuticos Lda |
100% |
Stuart-Produtos Farmacêuticos Lda |
100% |
Zeneca Epsilon – Produtos Farmacêuticos Lda |
100% |
Zenecapharma Produtos Farmacêuticos, |
100% |
Unipessoal Lda |
|
Rua Humberto Madeira, No 7, Queluz de Baixo, |
|
2730-097, Barcarena, Portugal |
|
Puerto Rico |
|
IPR Pharmaceuticals, Inc. |
100% |
Road 188, San Isidro Industrial Park, |
|
Canóvanas, 00729, Puerto Rico |
|
Romania |
|
AstraZeneca Pharma S.R.L. |
100% |
Bucharest, 1A Tipografilor Street, |
|
MUSE Offices, 2nd and 3rd Floor, District 1, |
|
013714, Romania |
|
Russia |
|
AstraZeneca Industries LLC |
100% |
81 Vostochniy Lane, Dobrino Village, |
|
Borovskiy District, Kaluga Region, |
|
249006, Russian Federation |
|
AstraZeneca Pharmaceuticals LLC |
100% |
1 Krasnogvardeyskiy Lane 21, Bld.1, Floors |
|
20-30, Moscow, 123112, Russian Federation |
|
Alexion Pharma LLC |
100% |
12 Presnenskaya Embankment, Premises 1/36, |
|
Moscow, 123112, Russian Federation |
|
Saudi Arabia |
|
AstraZeneca Continent – |
100% |
Regional Headquarter |
|
Al-Nakhlah Tower, Floor 13th Ath Thumamah |
|
Road, Al Sahafa District, P.O. Box 42150, |
|
Riyadh, Kingdom of Saudi Arabia |
|
AstraZeneca Trading Company |
100% |
8125 Prince Sultan, 2086 Ar Rawdah District, |
|
23435, Jeddah, Kingdom of Saudi Arabia |
|
Singapore |
|
AstraZeneca Pharmaceuticals |
100% |
Singapore Pte. Limited |
|
AstraZeneca Singapore Pte Ltd |
100% |
10 Kallang Avenue #12-10, Aperia Tower 2, |
|
339510, Singapore |
|
South Africa |
|
AstraZeneca Pharmaceuticals (Pty) Limited |
100% |
17 Georgian Crescent West, |
|
Northdowns Office Park, Bryanston, 2191, |
|
South Africa |
At 31 December 2024 |
Group Interest |
South Korea |
|
AstraZeneca Korea Co. Ltd |
100% |
21st Floor, Asem Tower, 517, Yeongdong-daero, |
|
Gangnam-gu, Seoul, 06164, Republic of Korea |
|
Alexion Pharma Korea LLC |
100% |
41 FL., 152 Teheran-ro (Yeoksam-dong |
|
Gangnam Finance Center), Gangnam-gu, |
|
Seoul, Republic of Korea |
|
Spain |
|
AstraZeneca Farmaceutica Holding Spain SA |
100% |
AstraZeneca Farmaceutica Spain SA |
100% |
Evinova Spain SL |
100% |
Fundación AstraZeneca |
100% |
Laboratorio Beta SA |
100% |
Laboratorio Lailan SA |
100% |
Laboratorio Tau SA |
100% |
Calle del Puerto de Somport, 21-23, |
|
Madrid 28050, Spain |
|
Alexion Pharma Spain SL |
100% |
Av Diagonal Num.601 P.1, |
|
Barcelona 08028, Spain |
|
Sweden |
|
AstraZeneca AB |
100% |
AstraZeneca Biotech AB |
100% |
AstraZeneca BioVentureHub AB |
100% |
AstraZeneca International |
100% |
Holdings Aktiebolag |
|
AstraZeneca Pharmaceuticals Aktiebolag |
100% |
AstraZeneca Södertälje 2 AB |
100% |
Evinova AB |
100% |
SE-151 85 Södertälje, Sweden |
|
Alexion Pharma Nordics Holding AB |
100% |
Alexion Pharma Nordics AB |
100% |
Hagaplan 4, 113 68 Stockholm, Sweden |
|
Switzerland |
|
Alexion Pharma GmbH |
100% |
AstraZeneca AG |
100% |
Evinova AG |
100% |
Neuhofstrasse 34, 6340 Baar, Switzerland |
|
Spirogen Sarl (in liquidation) |
100% |
Rue du Grand-Chêne 5, |
|
CH-1003 Lausanne, Switzerland |
|
Taiwan |
|
Alexion Pharma Taiwan Ltd |
100% |
AstraZeneca Taiwan Limited |
100% |
21st Floor, Taipei Metro Building 207, |
|
Tun Hwa South Road, SEC 2 Taipei, Taiwan |
|
Thailand |
|
AstraZeneca (Thailand) Limited |
100% |
Asia Centre 19th floor, 173/20, |
|
South Sathorn Rd, Khwaeng Thungmahamek, |
|
Khet Sathorn, Bangkok, 10120, Thailand |
|
Tunisia |
|
AstraZeneca Tunisie SaRL |
100% |
Lot n°1.5.5 les jardins du lac, |
|
bloc B les berges du lac Tunis, Tunisia |
AstraZeneca
Annual Report & Form 20-F Information 2024
216
Strategic Report
Corporate Governance
Financial Statements
Additional Information
At 31 December 2024 |
Group Interest |
Turkey |
|
AstraZeneca Ilac Sanayi ve |
100% |
Ticaret Limited Sirketi |
|
Y.K.B Plaza, B Blok, Kat:3-4, Levent/Beşiktaş, |
|
Istanbul, Turkey |
|
Zeneca Ilac Sanayi ve Ticaret Anonim Sirketi |
100% |
Büyükdere Cad., Y.K.B. Plaza, B Blok, Kat:4, |
|
Levent/Beşiktaş, Istanbul, Turkey |
|
Alexion Ilac Ticaret Limited Sirketi |
100% |
İçerenköy Mahellisi Umut SK. and Ofis Sit. |
|
No: 10 12/73 Ataşehir, Istanbul 10-12/73, Turkey |
|
Ukraine |
|
AstraZeneca Ukraina LLC |
100% |
54 Simi Prakhovykh Street, Kyiv, 01033, Ukraine |
|
United Arab Emirates |
|
AstraZeneca FZ-LLC |
100% |
Dubai Sciences Park Towers, Tower South, |
|
S1706S, Dubai Sciences Park, Dubai, |
|
United Arab Emirates |
|
Alexion Pharma Middle East FZ-LLC |
100% |
Dubai Science Park, 501, Floor 5, EIB |
|
Building No. 2, Dubai, United Arab Emirates |
|
United Kingdom |
|
Alexion Pharma UK Limited |
100% |
Ardea Biosciences Limited |
100% |
Arrow Therapeutics Limited |
100% |
Astra Pharmaceuticals Limited |
100% |
AstraPharm |
100% |
AstraZeneca China UK Limited |
100% |
AstraZeneca Death In Service Trustee Limited |
100% |
AstraZeneca Employee Share Trust Limited |
100% |
AstraZeneca Finance Limited |
100% |
AstraZeneca Intermediate Holdings Limited 8 |
100% |
AstraZeneca Investments Limited |
100% |
AstraZeneca Japan Limited |
100% |
AstraZeneca Nominees Limited |
100% |
AstraZeneca Quest Limited |
100% |
AstraZeneca Share Trust Limited |
100% |
AstraZeneca Sweden Investments Limited |
100% |
AstraZeneca Treasury Limited |
100% |
AstraZeneca UK Limited |
100% |
AstraZeneca US Investments Limited 8 |
100% |
AZENCO2 Limited |
100% |
AZENCO4 Limited |
100% |
AZENCO5 Limited |
100% |
AZENCO6 Limited |
100% |
Cambridge Antibody Technology |
100% |
Group Limited |
|
Evinova Limited |
100% |
KuDOS Horsham Limited |
100% |
KuDOS Pharmaceuticals Limited |
100% |
Zenco (No. 8) Limited |
100% |
Zeneca Finance (Netherlands) Company |
100% |
MedImmune Limited |
100% |
1 Francis Crick Avenue, Cambridge |
|
Biomedical Campus, Cambridge, CB2 0AA, |
|
United Kingdom |
At 31 December 2024 |
Group Interest |
MedImmune U.K. Limited |
100% |
Plot 6, Renaissance Way, Boulevard Industry |
|
Park, Liverpool, L24 9JW, United Kingdom |
|
Syntimmune Limited |
100% |
21 Holborn Viaduct, London, EC1A 2DY, |
|
United Kingdom |
|
United States |
|
Acerta Pharma LLC 9 |
100% |
121 Oyster Point Boulevard, |
|
South San Francisco, CA 94080, |
|
United States |
|
Alexion Pharmaceuticals, Inc. |
100% |
Achillion Pharmaceuticals Inc. |
100% |
Alexion US1 LLC 9 |
100% |
Savoy Therapeutics Corp |
100% |
Syntimmune LLC 9 |
100% |
TeneoTwo, Inc. |
100% |
121 Seaport Boulevard Boston, MA 02210, |
|
United States |
|
Alexion Services Latin America Inc. |
100% |
600 Brickell Ave, Miami, FL 33131, United States |
|
AlphaCore Pharma, LLC 9 |
100% |
333 Parkland Plaza, Suite 5, Ann Arbor, |
|
MI 48103, United States |
|
Amolyt Pharma Inc. |
100% |
185 Alewife Brook Pkwy, Suite 210, |
|
Cambridge, MA 02138, United States |
|
Amylin Ohio LLC 9 |
100% |
Amylin Pharmaceuticals, LLC 9 |
100% |
Ardea Biosciences, Inc. |
100% |
AstraZeneca Collaboration Ventures, LLC 9 |
100% |
AstraZeneca Finance and Holdings Inc. |
100% |
AstraZeneca Finance LLC 9 |
100% |
AstraZeneca Pharmaceuticals LP 10 |
100% |
Atkemix Nine Inc. |
100% |
Atkemix Ten Inc. |
100% |
Corpus Christi Holdings Inc. |
100% |
LogicBio Securities Corporation |
100% |
LogicBio Therapeutics, Inc. |
100% |
Neogene Therapeutics, Inc. |
100% |
Omthera Pharmaceuticals, Inc. |
100% |
Optein, Inc. |
100% |
Stauffer Management Company LLC 9 |
100% |
Zeneca Inc. |
100% |
Zeneca Holdings Inc. |
100% |
Zeneca Wilmington Inc. 8 |
100% |
1800 Concord Pike, Wilmington, |
|
DE 19803, United States |
|
AZ-Mont Insurance Company |
100% |
100 Bank Street, Suite 630, Burlington, |
|
VT 05401, United States |
|
Caelum Biosciences Inc. |
100% |
1200 Florence Columbus Road, Bordentown, |
|
NJ 08505, United States |
|
Cincor Pharma Inc. |
100% |
100 College Street, New Haven, |
|
CT 06510, United States |
At 31 December 2024 |
Group Interest |
Evinova Inc. |
100% |
101 Orchard Ridge Drive, Gaithersburg, |
|
MD 20878, United States |
|
Fusion Pharmaceuticals US Inc. |
100% |
2 International Place, Suite 2310, Boston, |
|
MA 02110, United States |
|
Gracell Biopharmaceuticals, Inc. |
100% |
530 Lytton Avenue, 2nd Floor, Palo Alto, |
|
CA 94301, United States |
|
Icosavax, Inc. |
100% |
1930 Boren Avenue, Suite 1000, Seattle, |
|
WA 98101, United States |
|
MedImmune, LLC 9 |
100% |
MedImmune Ventures, Inc. |
100% |
One MedImmune Way, Gaithersburg, |
|
MD 20878, United States |
|
Pearl Therapeutics, Inc. |
100% |
200 Cardinal Way, Redwood City, |
|
CA 94063, United States |
|
Portola Pharmaceuticals LLC |
100% |
Portola USA, Inc. |
100% |
270 East Grand Avenue, South San Francisco, |
|
CA 94080, United States |
|
ZS Pharma, Inc. |
100% |
1100 Park Place, Suite 300, San Mateo, |
|
CA 94403, United States |
|
Uruguay |
|
AstraZeneca S.A. |
100% |
Yaguarón 1407 of 1205, 11.100, |
|
Montevideo, Uruguay |
|
Venezuela |
|
AstraZeneca Venezuela S.A. |
100% |
Gotland Pharma S.A. |
100% |
Av. La Castellana, Torre La Castellana, |
|
Piso 5, Oficina 5-G, 5-H, 5-I, Urbanización |
|
La Castellana, Municipio Chacao, |
|
Estado Bolivariano de Miranda, Venezuela |
|
Vietnam |
|
AstraZeneca Vietnam Company Limited |
100% |
18th Floor, A&B Tower, 76 Le Lai, |
|
Ben Thanh Ward, District 1, |
|
Ho Chi Minh City, Vietnam |
Group Subsidiaries and Holdings
AstraZeneca
Annual Report & Form 20-F Information 2024
217
Financial Statements
Group Subsidiaries and Holdings
continued
At 31 December 2024 | Group Interest |
Subsidiaries where the effective interest | |
is less than 100% | |
Algeria | |
AstraZeneca Algeria | 49% |
Pharmaceutical Industries SPA | |
N° 20, Micro Zone d’Activité Hydra, Centre | |
des Affaires Dar El Madina, Bloc A, 6th Floor, | |
Hydra, Algiers, Algeria | |
China | |
Beijing Falikang Pharmaceutical Co., Ltd. | 48.90% |
Room 113, Floor 1, Unit 1, Building No. 6, | |
88 Kechuang 6th Street, | |
Economic-Technological Development Area, | |
Beijing, China | |
India | |
AstraZeneca Pharma India Limited 6 | 75% |
Block N1, 12th Floor, Manyata Embassy | |
Business Park, Rachenahalli, Outer Ring Road, | |
Bangalore-560 045, India | |
Indonesia | |
P.T. AstraZeneca Indonesia | 95% |
Perkantoran Hijau Arkadia Tower F, 3rd Floor, | |
JI. T.B. Simatupang Kav. 88, South Jakarta, | |
12520, Indonesia | |
Switzerland | |
SixPeaks Bio AG 11,13 | 34.10% |
Aeschenvorstadt 36, 4501 Basel, Switzerland | |
United States | |
VaxNewMo, LLC 12,13 | 19.90% |
4447 McPherson Avenue, St. Louis, | |
MO 63108, United States | |
Joint Ventures | |
Hong Kong | |
IHP HK Holdings Limited | 50% |
Unit 1402, 14th Floor, Henley Building, | |
No. 5 Queen’s Road Central, Hong Kong | |
WuXi MedImmune Biopharmaceutical Co., | 50% |
Limited (in liquidation) | |
Room 1902, 19/F, Lee Garden One, | |
33 Hysan Avenue, Causeway Bay, Hong Kong | |
United States | |
Montrose Chemical Corporation of California | 50% |
Suite 380, 600 Ericksen Ave N/E, | |
Bainbridge Island, WA 98110, United States |
At 31 December 2024 | Group Interest |
Significant Holdings | |
China | |
Dizal (Jiangsu) Pharmaceutical Co., Ltd. | 26.21% |
199 Liangjing Rd, Zhangjiang Hi-Tech Park, | |
Pudong District, Shanghai, 201203, China | |
Wuxi AstraZeneca-CICC Venture Capital | 22.13% |
Partnership (Limited Partnership) | |
Wuxi AstraZeneca-CICC No.1 Venture | 22.13% |
Capital Partnership (Limited Partnership) | |
Room 808, 8F, Building 99-2 Linghu Avenue, | |
Xinwu District, Wuxi, Jiangsu, China | |
United Kingdom | |
VaxEquity Ltd. 13 (in liquidation) | 40% |
Victory House, Vision Park, Chivers Way, | |
Histon, Cambridge, CB24 9ZR, United Kingdom | |
United States | |
C.C. Global Chemicals Company | 37.50% |
P.O. Box 7, MS2901, TX 76101-0007, | |
United States | |
Associated Holdings | |
Cayman Islands | |
Fuse Biosciences (Cayman) Limited 13 | 18.75% |
3-212 Governors Square, | |
23 Lime Tree Bay Avenue, P.O. Box 30746, | |
Seven Mile Beach, Grand Cayman KY1-1203, | |
Cayman Islands | |
France | |
Medetia SAS 13 | 10% |
Institute Imagine, 24 Boulevard du | |
Montparnasse, 75015 Paris, France | |
Cellectis S.A. 3 | 43.96% |
8, rue de la Croix Jarry, 75013 Paris, France | |
Israel | |
AION Labs Innovation Lab Ltd. | 19.23% |
CombinAble.AI Ltd. 13 | 11.25% |
ProPhet Bio Ltd. 13 | 11.94% |
TenAces Biosciences Ltd. 13 | 12.50% |
4 Oppenheimer Street, Building B, | |
Rehovot, 7670104, Israel |
At 31 December 2024 | Group Interest |
Sweden | |
Swedish Orphan Biovitrum AB (publ) | 9.74% |
Tomtebodavägen 23A, Stockholm, Sweden | |
OnDosis AB | 19.80% |
GoCo House, 5 tr, Gemenskapens gata 9, | |
431 53 Mölndal, Sweden | |
CCRM Nordic AB | 19.90% |
Förändringens Gata 10, | |
431 53 Mölndal, Sweden | |
United Kingdom | |
Niox Group plc | 16.61% |
Magdalen Centre, 1 Robert Robinson Ave, | |
Science Park, Oxford, OX4 4GA, | |
United Kingdom | |
United States | |
AbMed Corporation 3 | 18% |
68 Cummings Park Drive, Woburn, | |
MA 01801, United States | |
Baergic Bio, Inc. | 19.95% |
1111 Kane Concourse, Suite 301, | |
Bay Harbor Islands, FL 33154, United States | |
Regio Biosciences, Inc. 13 | 19.54% |
5237 River Road, #361 Bethesda, | |
MD 20816, United States |
Employee Benefit Trusts |
The AstraZeneca Employee Benefit Trust |
AstraZeneca PSP/GRSP EBP |
for Canadian Employees |
1 | Ownership held in ordinary and special shares. |
2 | Ownership held by way of capital contribution. |
3 | Ownership held in ordinary and preference shares. |
4 | 10% directly held by AstraZeneca PLC. |
5 | Sold to external third party effective 17 January 2025. |
6 | Accounting year end is 31 March. |
7 | Accounting year end is 30 June. |
8 | Directly held by AstraZeneca PLC. |
9 | Ownership held as membership interest. |
10 | Ownership held as partnership interest. |
11 | Consolidated due to AstraZeneca AB having an option to acquire. |
12 | Consolidated due to Zeneca Inc. having an option to acquire. |
13 | Ownership held in preference shares. |
AstraZeneca
Annual Report & Form 20-F Information 2024
218
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Company Balance Sheet
AstraZeneca
Annual Report & Form 20-F Information 2024
219
at 31 December
AstraZeneca PLC
2024 |
2023 |
||
Notes |
$m |
$m |
|
Fixed assets |
|||
Fixed asset investments |
1 |
62,019 |
64,189 |
62,019 |
64,189 |
||
Current assets |
|||
Debtors – other |
8 |
4 |
|
Debtors – amounts owed by Group undertakings |
5,807 |
10,928 |
|
5,815 |
10,932 |
||
Creditors: Amounts falling due within one year |
|||
Other payables |
2 |
(202) |
(216) |
Interest-bearing loans and borrowings |
3 |
(1,997) |
(2,995) |
(2,199) |
(3,211) |
||
Net current assets |
3,616 |
7,721 |
|
Total assets less current liabilities |
65,635 |
71,910 |
|
Creditors: Amounts falling due after more than one year |
|||
Interest-bearing loans and borrowings |
3 |
(14,549) |
(16,741) |
Income tax payable |
(36) |
– |
|
Other payables |
2 |
(47) |
(21) |
(14,632) |
(16,762) |
||
Net assets |
51,003 |
55,148 |
|
Capital and reserves |
|||
Called-up share capital |
4 |
388 |
388 |
Share premium account |
35,226 |
35,188 |
|
Capital redemption reserve |
153 |
153 |
|
Other reserves |
1,741 |
1,779 |
|
Profit and loss account |
13,495 |
17,640 |
|
Shareholders’ funds |
51,003 |
55,148 |
$m means millions of US dollars.
The Company’s profit for the year was $457m (2023: $14,669m).
The Company Financial Statements from pages 219 to 225 were approved by the Board and were signed on its behalf by
Pascal Soriot |
Aradhana Sarin |
Director |
Director |
6 February 2025 |
Company’s registered number 02723534
Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
220
Company Statement of Changes in Equity
for the year ended 31 December
Share | Capital | |||||
Share | premium | redemption | Other | Profit and | Total | |
capital | account | reserve | reserves 1 | loss account 2 | equity | |
$m | $m | $m | $m | $m | $m | |
At 1 January 2023 | 387 | 35,155 | 153 | 1,927 | 7,458 | 45,080 |
Total comprehensive income for the period | ||||||
Profit for the period | – | – | – | – | 14,669 | 14,669 |
Total comprehensive income for the period | – | – | – | – | 14,669 | 14,669 |
Transactions with owners, recorded directly in equity | ||||||
Dividends | – | – | – | – | (4,487) | (4,487) |
Capital contributions for share-based payments | – | – | – | (148) | – | (148) |
Issue of Ordinary Shares | 1 | 33 | – | – | – | 34 |
Total contributions by and distributions to owners | 1 | 33 | – | (148) | (4,487) | (4,601) |
At 31 December 2023 | 388 | 35,188 | 153 | 1,779 | 17,640 | 55,148 |
Total comprehensive income for the period | ||||||
Profit for the period | – | – | – | – | 457 | 457 |
Total comprehensive income for the period | – | – | – | – | 457 | 457 |
Transactions with owners, recorded directly in equity | ||||||
Dividends | – | – | – | – | (4,602) | (4,602) |
Capital contributions for share-based payments | – | – | – | (38) | – | (38) |
Issue of Ordinary Shares | – | 38 | – | – | – | 38 |
Total contributions by and distributions to owners | – | 38 | – | (38) | (4,602) | (4,602) |
At 31 December 2024 | 388 | 35,226 | 153 | 1,741 | 13,495 | 51,003 |
1
The Other reserves arose from the cancellation of £1,255m share premium by the Company in 1993 and the redenomination of share capital of $157m in 1999. Included within Other
reserves at 31 December 2024 is $(100)m (31 December 2023: $(62)m) in respect of cumulative share-based payment awards, which are not available for distribution.
2
At 31 December 2024, the overwhelming majority of the Profit and loss account reserve of $13,495m (31 December 2023: the overwhelming majority of $17,640m) was available for
distribution, subject to filing these Financial Statements with Companies House. When making a distribution to shareholders, the Directors determine profits available for distribution
by reference to guidance on realised and distributable profits under the Companies Act 2006 issued by the Institute of Chartered Accountants in England and Wales and the Institute
of Chartered Accountants of Scotland in April 2017. The profits of the Company have been received in the form of receivables due from subsidiaries. The availability of distributable
reserves in the Company is dependent on those receivables meeting the definition of qualifying consideration within the guidance, and in particular on the ability of subsidiaries to
settle those receivables within a reasonable period of time. The Directors consider that, based on the nature of these receivables and the available cash resources of the Group and
other accessible sources of funds, at 31 December 2024, the overwhelming majority (31 December 2023: the overwhelming majority) of the Company’s profit and loss reserves were
available for distribution.
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Company Accounting Policies
AstraZeneca
Annual Report & Form 20-F Information 2024
221
Company Accounting Policies
Basis of presentation of
financial information
The Company is a public limited company,
limited by shares, incorporated and domiciled
in England & Wales. The registered address
is 1 Francis Crick Avenue, Cambridge
Biomedical Campus, Cambridge, CB2 0AA.
These financial statements were prepared
in accordance with FRS 101 ‘Reduced
Disclosure Framework’.
In preparing these financial statements,
the Company applied the recognition,
measurement and disclosure requirements of
International Financial Reporting Standards
as adopted by the UK (UK-adopted
international accounting standards), but
made amendments where necessary in
order to comply with the Companies Act
2006 and to take advantage of FRS 101
disclosure exemptions.
In these financial statements, the Company
has applied the exemptions available under
FRS 101 in respect of the following disclosures:
•
Statement of Cash Flows and related notes
•
disclosures in respect of transactions
with wholly owned subsidiaries
•
disclosures in respect of
capital management
•
the effects of new but not yet
effective IFRSs
•
disclosures in respect of the compensation
of Key Management Personnel.
As the Group Financial Statements (presented
on pages 148 to 218) include the equivalent
disclosures, the Company has also taken
the exemptions under FRS 101 available in
respect of the following disclosures:
•
IFRS 2 ‘Share-based Payment’ in respect
of Group settled share-based payments
•
certain disclosures required by IFRS 13
‘Fair Value Measurement’ and the
disclosures required by IFRS 7 ‘Financial
Instruments: Disclosures’.
No individual profit and loss account is
prepared as provided by section 408 of the
Companies Act 2006.
Basis of accounting
The Company Financial Statements are
prepared under the historical cost convention
and on a going concern basis, in accordance
with the Companies Act 2006.
The following paragraphs describe the
main accounting policies, which have been
applied consistently.
Estimates and judgements
The preparation of the Company Financial
Statements in conformity with generally
accepted accounting principles requires
management to make estimates and
judgements that affect the reported amounts
of assets and liabilities at the date of the
Financial Statements and the reported
amounts of revenues and expenses during
the reporting period. Actual results could
differ from those estimates. There are no
key judgements or significant estimates.
Foreign currencies
Foreign currency transactions, being
transactions denominated in a currency other
than the Company’s functional currency, are
translated into US dollars at average rates
for the relevant monthly accounting periods,
which approximate to actual rates.
Monetary assets and liabilities arising from
foreign currency transactions are retranslated
at exchange rates prevailing at the reporting
date. Exchange gains and losses on loans and
on short-term foreign currency borrowings
and deposits are included within Finance
expense. Exchange differences on all other
foreign currency transactions are recognised
in Operating profit.
Non-monetary items arising from foreign
currency transactions are not retranslated
in the Company’s accounting records.
Taxation
The current tax payable is based on taxable
profit for the year. Taxable profit differs
from reported profit because taxable profit
excludes items that are either never taxable
or tax deductible or items that are taxable
or tax deductible in a different period. The
Company’s current tax assets and liabilities
are calculated using tax rates that have
been enacted or substantively enacted by
the reporting date. Current tax includes the
Company’s charge for any Pillar Two
income taxes.
Deferred tax is provided using the balance
sheet liability method, providing for temporary
differences between the carrying amounts of
assets and liabilities for financial reporting
purposes and the amounts used for taxation
purposes. Deferred tax liabilities are
recognised unless they arise from the initial
recognition (other than in a business
combination) of assets and liabilities in a
transaction that affects neither the taxable
profit nor the accounting profit. Deferred tax
liabilities are not recognised to the extent they
arise from the initial recognition of non-tax
deductible goodwill. Deferred tax assets
are recognised to the extent that there are
future taxable temporary differences or it
is probable that future taxable profit will
be available against which the asset can
be utilised. This requires judgements to be
made in respect of the availability of future
taxable income.
No deferred tax asset or liability is recognised
in respect of temporary differences
associated with investments in subsidiaries
and branches where the Company is able to
control the timing of reversal of the temporary
differences and it is probable that the
temporary differences will not reverse in
the foreseeable future.
The Company’s deferred tax assets and
liabilities are calculated using tax rates that
are expected to apply in the period when the
liability is settled or the asset realised based
on tax rates that have been enacted or
substantively enacted by the reporting date.
The Company applies the exception to
recognising and disclosing information
about deferred tax assets and liabilities
related to Pillar Two income taxes, as
provided in the amendments to IAS 12
‘Incomes Taxes’ issued in May 2023.
Liabilities for uncertain tax positions require
management to make judgements of potential
exposures in relation to tax audit issues.
Tax benefits are not recognised unless the
tax positions will probably be accepted
by the tax authorities. This is based upon
management’s interpretation of applicable
laws and regulations and the expectation of
how the tax authority will resolve the matter.
Once considered probable of not being
accepted, management reviews each
material tax benefit and reflects the effect
of the uncertainty in determining the related
taxable result.
Financial Statements
Company Accounting Policies
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
222
Liabilities for uncertain tax positions are
measured using either the most likely amount
or the expected value amount depending
on which method the Company expects to
better predict the resolution of the uncertainty.
Investments
Fixed asset investments, including
investments in subsidiaries, are stated at
cost and reviewed for impairment if there
are indications that the carrying value may
not be recoverable.
Debtors
Amounts owed by Group undertakings are
recognised initially at fair value. Subsequent
to initial recognition they are measured at
amortised cost using the effective interest
method, less any impairment losses.
The recoverability of these balances has
been assessed in accordance with IFRS 9
‘Financial Instruments’ and no impairment has
been identified. The amounts owed by Group
undertakings are considered to have low
credit risk, due to timely payment of interest
and settlement of principal amounts on
agreed due dates, limiting the loss allowance
to 12-month expected credit losses.
Amounts owed by Group undertakings are
written off where there is no reasonable
expectation of recovery. Impairment losses
are presented as net impairment losses
within Operating profit, any subsequent
recoveries are credited against the same line.
Other payables
Liabilities included in Other payables are
recognised initially at fair value. Subsequent
to initial recognition they are remeasured at
either amortised cost using the effective
interest method or at fair value using an
expected credit loss model.
Financial instruments
Interest-bearing loans are initially measured
at fair value (with direct transaction costs
being amortised over the life of the loan) and
are subsequently measured at amortised
cost using the effective interest method at
each reporting date. Changes in carrying
value are recognised in profit.
Share-based payments
The issuance by the Company to employees
of its subsidiaries of a grant of awards over
the Company’s shares, represents additional
capital contributions by the Company to its
subsidiaries (or capital reimbursement from
those subsidiaries). An additional investment/
divestment in subsidiaries results in a
corresponding increase/decrease in
shareholders’ equity. The additional capital
contribution/reimbursement is based on the
fair value of the grant issued, allocated over
the underlying grant’s vesting period, less the
market cost of shares charged to subsidiaries
in settlement of such share awards.
Litigation
Through the normal course of business,
the AstraZeneca Group is involved in legal
disputes, the settlement of which may involve
cost to the Company. A provision is made
where an adverse outcome is probable and
associated costs, including related legal
costs, can be estimated reliably. In other
cases, appropriate disclosures are included.
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Company Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
223
Notes to the Company Financial Statements
1 Fixed asset investments
Investments in subsidiaries |
|||
Shares |
Loans |
Total |
|
$m |
$m |
$m |
|
At 1 January 2023 |
49,192 |
14,363 |
63,555 |
Additions during the year |
– |
1,588 |
1,588 |
Transfer to Debtors – amounts owed by Group undertakings |
– |
(991) |
(991) |
Capital reimbursement |
(131) |
– |
(131) |
Exchange |
– |
158 |
158 |
Amortisation |
– |
12 |
12 |
Other movements |
(2) |
– |
(2) |
At 31 December 2023 |
49,059 |
15,130 |
64,189 |
Additions during the year |
33,745 |
– |
33,745 |
Disposals during the year |
(33,745) |
– |
(33,745) |
Transfer to Debtors – amounts owed by Group undertakings |
– |
(1,997) |
(1,997) |
Capital reimbursement |
(54) |
– |
(54) |
Exchange |
– |
(156) |
(156) |
Amortisation |
– |
11 |
11 |
Other movements |
26 |
– |
26 |
At 31 December 2024 |
49,031 |
12,988 |
62,019 |
Loans to subsidiaries consists of bonds which are issued externally and are issued back to Group undertakings with comparable terms on
interest rates and are repayable on maturity, details of which are disclosed in Note 3. The recoverability of these inter-company loans has been
assessed in accordance with IFRS 9 ‘Financial Instruments’ with no impairment identified. The inter-company balances are considered to have
low credit risk due to timely payment of interest and settlement of principal amount on agreed due dates, limiting the loss allowance to 12-month
expected credit losses. In 2024, there have been no credit losses (2023: $nil).
The other movements comprise $26m representing issue and revaluation of carrying value of guarantees provided by the Company to its
subsidiary as explained in Notes 2 and 3.
2 Other payables
2024 |
2023 |
|
$m |
$m |
|
Amounts falling due within one year |
||
Other creditors |
199 |
214 |
Deferred income |
3 |
2 |
202 |
216 |
|
Amounts falling due after more than one year |
||
Other creditors |
47 |
21 |
Other creditors due after more than one year comprise an amount representing the carrying value of the guarantees provided by the Company
to its subsidiary for the bonds issued externally as explained in Note 3. As at 31 December 2024, the carrying value of the guarantees was
$47m (2023: $21m).
Financial Statements
Notes to the Company Financial Statements
continued
AstraZeneca
Annual Report & Form 20-F Information 2024
224
3 Loans and borrowings
Repayment | 2024 | 2023 | ||
dates | $m | $m | ||
Amounts due within one year | ||||
Interest-bearing loans and borrowings (unsecured) | ||||
0.75% Callable bond | euros | 2024 | – | 995 |
2024 Floating rate bank loans | US dollars | 2024 | – | 2,000 |
3.375% Callable bond | US dollars | 2025 | 1,997 | – |
Total amounts due within one year | 1,997 | 2,995 | ||
Amounts due after more than one year | ||||
Interest-bearing loans and borrowings (unsecured) | ||||
3.375% Callable bond | US dollars | 2025 | – | 1,994 |
0.7% Callable bond | US dollars | 2026 | 1,198 | 1,196 |
3.625% Callable bond | euros | 2027 | 780 | 829 |
3.125% Callable bond | US dollars | 2027 | 748 | 747 |
1.25% Callable bond | euros | 2028 | 829 | 879 |
4% Callable bond | US dollars | 2029 | 996 | 995 |
0.375% Callable bond | euros | 2029 | 829 | 881 |
1.375% Callable bond | US dollars | 2030 | 1,295 | 1,294 |
5.75% Non-callable bond | pounds sterling | 2031 | 438 | 444 |
3.75% Callable bond | euros | 2032 | 778 | 827 |
6.45% Callable bond | US dollars | 2037 | 2,727 | 2,725 |
4% Callable bond | US dollars | 2042 | 989 | 989 |
4.375% Callable bond | US dollars | 2045 | 982 | 981 |
4.375% Callable bond | US dollars | 2048 | 738 | 738 |
2.125% Callable bond | US dollars | 2050 | 487 | 487 |
3% Callable bond | US dollars | 2051 | 735 | 735 |
Total amounts due after more than one year | 14,549 | 16,741 | ||
Total loans and borrowings | 16,546 | 19,736 |
2024 | 2023 | |
$m | $m | |
Loans and borrowings are repayable: | ||
After five years from balance sheet date | 9,169 | 11,096 |
From two to five years | 4,182 | 3,651 |
From one to two years | 1,198 | 1,994 |
Within one year | 1,997 | 2,995 |
Total unsecured | 16,546 | 19,736 |
All borrowings are issued with fixed interest rates, with the exception of the $2bn 2024 floating rate loans, which transitioned from LIBOR to
a rate based on compounded daily USD Secured Overnight Funding Rate (SOFR) during the prior year.
In addition, the Company acts as guarantor for bonds issued by its wholly-owned subsidiary, AstraZeneca Finance LLC. AstraZeneca Finance
LLC is the issuer of $1,250m 1.200% Notes due 2026, $1,250m 4.800% Notes due 2027, $1,100m 4.875% Notes due 2028, $1,250m 1.750%
Notes due 2028, $1,250m 4.850% Notes due 2029, $650m 4.900% Notes due 2030, €650m 3.121% Notes due 2030, $1,000m 4.900% Notes
due 2031, $750m 2.250% Notes due 2031, $500m 4.875% Notes due 2033, €750m 3.278% Notes due 2033 and $1,500m 5.000% Notes due
2034 (the ‘AstraZeneca Finance Notes’). Each series of AstraZeneca Finance Notes has been fully and unconditionally guaranteed by the
Company. Each of the guarantees by AstraZeneca PLC is full and unconditional and joint and several.
The guarantee by AstraZeneca PLC of the AstraZeneca Finance Notes is the senior unsecured obligation of AstraZeneca PLC and ranks equally
with all of AstraZeneca PLC’s existing and future senior unsecured and unsubordinated indebtedness. Each guarantee by AstraZeneca PLC is
effectively subordinated to any secured indebtedness of AstraZeneca PLC to the extent of the value of the assets securing such indebtedness.
The AstraZeneca Finance Notes are structurally subordinated to indebtedness and other liabilities of the subsidiaries of AstraZeneca PLC,
none of which guarantee the AstraZeneca Finance Notes.
4 Called-up share capital
Details of share capital movements in the year are included in Note 24 to the Group Financial Statements.
Strategic Report
Corporate Governance
Financial Statements
Additional Information
Notes to the Company Financial Statements
AstraZeneca
Annual Report & Form 20-F Information 2024
225
5 Contingent liabilities
Vaxzevria | Considered to be a contingent liability | |
UK | • | AstraZeneca is defending lawsuits in multiple jurisdictions, including the UK, involving multiple claimants alleging |
injuries following vaccination with AstraZeneca’s COVID-19 vaccine. Most of the lawsuits involve claims of | ||
thrombosis with thrombocytopenia syndrome. | ||
• | No trial dates have been scheduled. | |
Securities Litigation | Considered to be a contingent liability | |
US | • | In December 2024, a putative securities class action lawsuit was filed in the US District Court for the Central District |
of California against AstraZeneca PLC and certain officers, on behalf of purchasers of AstraZeneca publicly traded | ||
securities between February 2022 and December 2024. The complaint alleges that defendants made materially | ||
false and misleading statements in connection with the Company’s business in China. | ||
University of Sheffield | Considered to be a contingent liability | |
Contract Dispute | ||
UK | • | In June 2024, AstraZeneca was served with a lawsuit filed by the University of Sheffield (Sheffield). In its complaint, |
Sheffield alleges that AstraZeneca made misrepresentations to induce Sheffield to amend a patent license relating | ||
to Lynparza . | ||
• | AstraZeneca filed its defence in August 2024. No trial date has been scheduled. | |
Viela Bio, Inc. Shareholder Litigation | Considered to be a contingent liability | |
US | • | In February 2023, AstraZeneca was served with a lawsuit filed in the Delaware state court against AstraZeneca and |
certain officers (collectively, Defendants), on behalf of a putative class of Viela Bio, Inc. (Viela) shareholders. The | ||
complaint alleged that the Defendants breached their fiduciary duty to Viela shareholders in the course of Viela’s | ||
2021 merger with Horizon Therapeutics, plc. | ||
• | In July 2024, the Court granted with prejudice AstraZeneca’s motion to dismiss. | |
• | In August 2024, plaintiffs appealed the dismissal. | |
US Congressional Inquiry | Matter concluded | |
US | • | In January 2024, AstraZeneca received a letter from the US Senate Committee on Health, Education, Labor and |
Pensions (HELP Committee) seeking information related to AstraZeneca’s inhaled Respiratory products. | ||
• | AstraZeneca cooperated with this inquiry and this matter is now concluded. | |
Vermont US Attorney Investigation | Considered to be a contingent liability | |
US | • | In April 2020, AstraZeneca received a Civil Investigative Demand from the US Attorney’s Office in Vermont and the |
Department of Justice, Civil Division, seeking documents and information relating to AstraZeneca’s relationships | ||
with electronic health-record vendors. | ||
• | AstraZeneca continues to cooperate with this enquiry. | |
6 Statutory and other information
The Directors of the Company were paid by another Group company in 2024 and 2023.
7 Subsequent events
Group Financial Record
2020
2021
2022
2023
2024
For the year ended 31 December
$m
$m
$m
$m
$m
Revenue and profits
Product Sales
25,890
36,541
42,998
43,789
50,938
Alliance Revenue
190
388
755
1,428
2,212
Collaboration Revenue
537
488
598
594
923
Cost of sales
(5,299)
(12,437)
(12,391)
(8,268)
(10,207)
Distribution expense
(399)
(446)
(536)
(539)
(555)
Research and development expense
(5,991)
(9,736)
(9,762)
(10,935)
(13,583)
Selling, general and administrative expense
(11,294)
(15,234)
(18,419)
(19,216)
(19,977)
Other operating income and expense
1,528
1,492
514
1,340
252
Operating profit
5,162
1,056
3,757
8,193
10,003
Finance income
87
43
95
344
458
Finance expense
(1,306)
(1,300)
(1,346)
(1,626)
(1,742)
Share of after tax losses in associates and joint ventures
(27)
(64)
(5)
(12)
(28)
Profit/(loss) before tax
3,916
(265)
2,501
6,899
8,691
Taxation
(772)
380
792
(938)
(1,650)
Profit for the period
3,144
115
3,293
5,961
7,041
Other comprehensive income/(expense) for the period, net of tax
1,608
(145)
(878)
733
(800)
Total comprehensive income/(expense) for the period
4,752
(30)
2,415
6,694
6,241
Profit attributable to:
Owners of the Parent
3,196
112
3,288
5,955
7,035
Non-controlling interests
(52)
3
5
6
6
Earnings per share
Basic earnings per $0.25 Ordinary Share
$2.44
$0.08
$2.12
$3.84
$4.54
Diluted earnings per $0.25 Ordinary Share
$2.44
$0.08
$2.11
$3.81
$4.50
Dividends
$2.80
$2.80
$2.90
$2.90
$2.97
226
AstraZeneca
Annual Report & Form 20-F Information 2024
Financial Statements
Additional
Information
Contents
Shareholder information
228
Directors’ Report
230
Sustainability supplementary information
233
Trade Marks
239
Glossary
240
Cautionary statement regarding forward-looking
statements
244
Corporate Governance
Additional Information
Financial Statements
Strategic Report
227
AstraZeneca
Annual Report & Form 20-F Information 2024
Additional Information
AstraZeneca
Annual Report & Form 20-F Information 2024
This section of the Annual Report contains
information for shareholders that is required
by regulation in the UK. Further information
that may be of use to shareholders is available
on the Shareholder information page of our
website at www.astrazeneca.com.
Additional information required by SEC
regulations is included in AstraZeneca’s
Form 20-F filing for 2024, which is available
on the SEC website at www.sec.gov.
The principal markets for trading in
AstraZeneca shares are the London Stock
Exchange, Nasdaq Stockholm and the
Nasdaq Global Select Market (Nasdaq).
AstraZeneca shares were listed on Nasdaq
on 25 September 2020, prior to which they
were listed on the New York Stock Exchange.
Ordinary Shares of $0.25 each in
AstraZeneca PLC are listed on the London
Stock Exchange and the shareholder register
is maintained by Equiniti Limited, the Ordinary
Share registrar. Shares listed on Nasdaq
Stockholm are issued under the Euroclear
Services Agreement by Euroclear Sweden AB,
the Swedish Central Securities Depositary.
Shares listed on Nasdaq are in the form of
American Depositary Shares (ADSs),
evidenced by American Depositary Receipts
(ADRs) issued by the Company’s ADR
depositary. On 6 February 2025,
J.P. Morgan Chase Bank, N.A. was appointed
as the Company’s ADR Depositary, replacing
Deutsche Bank Trust Company Americas.
Two ADSs are equivalent to one Ordinary
Share. Shares are listed on all three markets
under the stock symbol AZN.
Ordinary Share registrar
Equiniti Limited
Aspect House
Spencer Road
Lancing
West Sussex
BN99 6DA
UK
Tel (freephone in UK): +44
(0)800 389 1580
Swedish Central Securities Depositary
Euroclear Sweden AB
PO Box 191
SE-101 23 Stockholm
Sweden
Tel: +46 (0)8 402 9000
ADR depositary
J.P. Morgan Chase Bank, N.A
Shareowner Services
PO Box 64504
St. Paul, MN 55164-0504
USA
Tel (general): +1 888 697 8018
Tel (outside US): +1 651 453 2128
Annual General Meeting (AGM)
The 2025 AGM will be held on 11 April 2025
and further details will be set out in the
Notice of AGM. If you hold shares listed on
Nasdaq Stockholm or hold ADRs, information
relating to voting and participation will be
included in the relevant Notice of AGM. If
you hold shares through a nominee, your
nominee provider will be able to advise you
of their arrangements in relation to voting
and participation.
Dividends
Dividend dates for 2025 are shown in the
financial calendar below. A first interim
dividend is normally announced in July/
August and paid in September and a
second interim dividend is normally
announced in January/February and paid
in March. Dividends are paid in GBP, SEK
and USD, depending on where the eligible
shares are listed.
Financial calendar
Event
Provisional date
Second interim dividend
for 2024
Ex-dividend date
20 February 2025
Record date
21 February 2025
Payment date
24 March 2025
Annual General Meeting
11 April 2025
Announcement of first
quarter results for 2025
29 April 2025
Financial year end
31 December 2025
Related party transactions
During the period 1 January 2025 to
31 January 2025, there were no transactions,
loans, or proposed transactions between
the Company and any related parties which
were material to either the Company or the
related party, or which were unusual in their
nature or conditions (see also Note 31 to the
Financial Statements on page 213).
Conflicts of interest
The Articles of Association of the Company
enable the Directors to authorise any
situation in which a Director has an interest
that conflicts or has the potential to conflict
with the Company’s interests and which
would otherwise be a breach of the
Director’s duty, under section 175 of the
Companies Act 2006. The Board has a
formal system in place for Directors to
declare such situations to be considered for
authorisation by those Directors who have
no interest in the matter being considered.
In deciding whether to authorise a situation,
the non-conflicted Directors must act in the
way they consider, in good faith, would be
most likely to promote the success of the
Company, and they may impose limits or
conditions when giving the authorisation,
or subsequently, if they think this is
appropriate. Situations considered by
the Board and authorisations given are
recorded in the Board minutes and in a
register of conflicts maintained by the
Company Secretary and are reviewed
annually by the Board. The Board believes
that this system operates effectively.
Shareholder fraud warning
Shareholders of AstraZeneca and many
other companies have reported receiving
unsolicited calls and correspondence
relating to their shareholdings and
investment matters. Shareholders are
advised to be very cautious of any
unsolicited approaches and to note that
reputable firms authorised by the Financial
Conduct Authority (FCA) are very unlikely to
make such approaches. Such approaches
are likely to be part of a ‘boiler room scam’
attempting to defraud shareholders.
Shareholders are advised to familiarise
themselves with the information on
scams available on the FCA website,
www.fca.org.uk/consumers and with
the FAQs in the Investors section of our
website, www.astrazeneca.com.
Any suspected scams or fraudulent
approaches should be reported to the
FCA via its website and to AstraZeneca’s
Ordinary Share registrar, using the contact
details on this page.
For more information on
dividends declared, see the
Shareholder information
section of our website,
www.astrazeneca.com.
228
AstraZeneca
Annual Report & Form 20-F Information 2024
Additional Information
Shareholder information
Issued share capital, shareholdings and share prices
At 31 December 2024, the Company had 63,435 registered holders of 1,550,546,239 Ordinary Shares. There were 171,061 holders
of Ordinary Shares held under the Euroclear Services Agreement, representing 9.9% of the issued share capital of the Company and
1,513 registered holders of ADSs, representing 19.2% of the issued share capital of the Company.
Ordinary Shares in issue
2024
2023
2022
Ordinary Shares in issue – millions
At year-end
1,551
1,550
1,550
Weighted average for year
1,550
1,549
1,548
Stock market closing price per Ordinary Share (London Stock Exchange)
Highest (pence)
13276
12294
11440
Lowest (pence)
9501
9900
8282
At year end (pence)
10468
10600
11218
Analysis of shareholdings as a percentage of issued share capital at 31 December
Number of Ordinary Shares
1
2024
%
2023
%
2022
%
1-250
0.2
0.3
0.3
251-500
0.3
0.3
0.3
501-1,000
0.3
0.4
0.4
1,001-5,000
0.5
0.5
0.5
5,001-10,000
0.2
0.2
0.2
10,001-50,000
1.1
1.1
1.1
50,001-1,000,000
11.2
11.3
1.1
Over 1,000,000
86.2
85.9
96.1
1
Includes Euroclear and ADR holdings.
For more information on
the Company’s share price,
including historical closing
prices and volumes, and an
interactive share price graph,
see the Investor Relations
section on our website,
www.astrazeneca.com.
229
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Shareholder information
The Directors’ Report includes information
required to be given in accordance with the
Companies Act 2006.
Relevant information below, which is
contained elsewhere in the Annual Report,
is incorporated by cross reference herein.
Subsidiaries and principal activities
The Company is the holding company
for a group of subsidiaries whose principal
activities are described in this Annual
Report. The Group’s subsidiaries and their
locations are set out in Group Subsidiaries
and Holdings in the Financial Statements
from page 214.
Branches and countries in which the
Group conducts business
In accordance with the Companies Act
2006, we disclose below countries of our
representative, scientific or branch offices
outside of the UK, established through
various subsidiaries of the Company:
Algeria, Angola, China, Costa Rica, Cuba,
Denmark, Egypt, Georgia, Ghana, Jordan,
Lebanon, Norway, Portugal, Romania,
Russia, Saudi Arabia, Slovakia, Slovenia,
Switzerland, Syria, Ukraine, United Arab
Emirates, the US, Vietnam and Yemen.
Disclosure of information to auditors
The Directors who held office at the date of
approval of this Annual Report confirm that,
so far as they are each aware, there is no
relevant audit information of which the
Company’s auditors are unaware; and each
Director has taken all the steps that he or
she ought to have taken as a Director to
make himself or herself aware of any
relevant audit information and to establish
that the Company’s auditors are aware of
that information.
Going concern accounting basis
Information on the business environment
in which AstraZeneca operates, including
the factors underpinning the industry’s
future growth prospects, is included in
the Strategic Report. Details of the product
portfolio of the Group are contained in the
Strategic Report (in the Therapy Area
Review from page 16). For information
on patent expiry dates for key marketed
products, see the Patent Expiries of Key
Marketed Products Supplement on our
website, www.astrazeneca.com/
annualreport2024. Our approach to product
development is covered in detail, with
additional information by therapy area in
the Strategic Report. For information on our
development pipeline, see the Development
Pipeline Supplement on our website,
www.astrazeneca.com/annualreport2024.
The financial position of the Group, its cash
flows, liquidity position and borrowing
facilities are described in the Financial
Review from page 67. In addition, Note 28
to the Financial Statements from page 194
includes the Group’s objectives, policies
and processes for: managing capital;
financial risk management objectives;
details of its financial instruments and
hedging activities; and its exposures to
credit, market and liquidity risk. Further
details of the Group’s cash balances and
borrowings are included in Notes 17 and 19
to the Financial Statements from page 178.
Having assessed the Principal Risks and
other matters considered in connection
with the Viability statement on page 63,
the Board considers it appropriate to
adopt the going concern basis of
accounting in preparing the Annual
Report and Financial Statements.
Shares
A shareholders’ resolution was passed at
the 2024 AGM authorising the Company to
purchase its own shares. The Company did
not purchase any of its own shares in 2024.
On 31 December 2024, the Company did
not hold any shares in treasury.
Rights, preferences and restrictions
attaching to shares
As at 31 December 2024, the Company had
1,550,546,239 Ordinary Shares and 50,000
Redeemable Preference Shares in issue.
The Ordinary Shares represent 99.98%
and the Redeemable Preference Shares
represent 0.02% of the Company’s total
share capital (these percentages have been
calculated by reference to the 8am WM/
Reuters USD/GBP exchange rate on
31 December 2024).
As agreed by the shareholders at the
Company’s AGM held on 29 April 2010,
the Articles of Association of the Company
(the Articles) were amended with immediate
effect to remove the requirement for the
Company to have an authorised share
capital, the concept of which was abolished
under the Companies Act 2006. Each
Ordinary Share carries the right to vote at
general meetings of the Company. The
rights and restrictions attaching to the
Redeemable Preference Shares differ
from those attaching to Ordinary Shares
as follows:
•
The Redeemable Preference Shares
carry no rights to receive dividends.
•
The holders of Redeemable Preference
Shares have no rights to receive notices
of, attend or vote at general meetings,
except in certain limited circumstances.
They have one vote for every 50,000
Redeemable Preference Shares held.
•
On a distribution of assets of the
Company, on a winding-up or other return
of capital (subject to certain exceptions),
the holders of Redeemable Preference
Shares have priority over the holders of
Ordinary Shares to receive the capital
paid up on those shares.
•
Subject to the provisions of the
Companies Act 2006, the Company has
the right to redeem the Redeemable
Preference Shares at any time on giving
not less than seven days’ written notice.
There are no specific restrictions on the
transfer of shares in the Company, which
is governed by the Articles and prevailing
legislation.
The Company is not aware of any
agreements between holders of shares that
may result in restrictions on the transfer of
shares or that may result in restrictions on
voting rights. The Company is also not
aware of any arrangements under which
financial rights are held by a person other
than the holder of the shares.
Action necessary to change the rights of
shareholders
In order to vary the rights attached to any
class of shares, the consent in writing of the
holders of three quarters in nominal value
of the issued shares of that class or the
sanction of a special resolution passed at a
general meeting of such holders is required.
Changes in share capital
Changes in the Company’s Ordinary
Share capital during 2024, including details
of the allotment of new shares under the
Company’s share plans, are given in
Note 24 to the Financial Statements from
page 192.
Employee share trust ownership rights
The trustee of the AstraZeneca Employee
Benefit Trust (the EBT, the Trustee) will not
exercise voting rights attached to shares
held in the EBT (Shares). Any decision as
to acceptance or rejection of an offer for
Shares subject to subsisting awards would
be made by the Trustee, having regard to
the interests of award holders.
There is a further employee benefit trust for
the benefit of employees who are residents
in Canada (the Canada EBT). The trustees of
the Canada EBT will not exercise voting
rights attached to shares held in the
Canada EBT.
For more information on
shares, see Issued share
capital, shareholdings and
share prices on page 229.
230
AstraZeneca
Annual Report & Form 20-F Information 2024
Additional Information
Directors’ Report
Distributions to shareholders –
dividends for 2024
Details of our distribution policy are set out
in the Financial Review from page 67 and
Note 28 to the Financial Statements from
page 194.
The Company’s dividend for 2024 of
$3.10 (245.6 pence, 33.75 SEK) per
Ordinary Share is estimated to amount to,
in aggregate, a total dividend payment
to shareholders of $4,806 million. Two
employee share trusts, AstraZeneca EBT
and AstraZeneca Share Trust Limited,
waived their rights to a dividend on the
Ordinary Shares they hold and instead
received nominal dividends. A further
employee share trust, the Canada EBT,
waived its right to receive the first interim
dividend of 2024 on the Ordinary Shares
it held on the applicable record date.
Articles of Association
AstraZeneca PLC’s current Articles were
adopted by shareholders at the Company’s
AGM held on 27 April 2023. Any amendment
to the Articles requires the approval of
shareholders by a special resolution at a
general meeting of the Company.
Objects
The Company’s objects are unrestricted.
Directors
The Board has the authority to manage
the business of the Company, for example,
through powers to allot and repurchase
its shares, subject where required to
shareholder resolutions. Subject to certain
exceptions, Directors do not have power to
vote at Board meetings on matters in which
they have a material interest.
The quorum for meetings of the Board is a
majority of the full Board, of whom at least
four must be Non-Executive Directors. In
the absence of a quorum, the Directors do
not have power to determine compensation
arrangements for themselves or any
member of the Board.
The Board may exercise all the powers of
the Company to borrow money. Variation
of these borrowing powers would require
the passing of a special resolution of the
Company’s shareholders.
All Directors must retire from office at the
Company’s AGM each year and may present
themselves for election or re-election.
Directors are not prohibited, upon reaching
a particular age, from submitting
themselves for election or re-election.
General meetings
AGMs require 21 clear days’ notice to
shareholders. Subject to the Companies
Act 2006, other general meetings require
14 clear days’ notice.
For all general meetings, a quorum of two
shareholders present in person or by proxy,
and entitled to vote on the business
transacted, is required unless each of the
two persons present is a corporate
representative of the same corporation,
or each of the two persons present is a
proxy of the same shareholder.
Shareholders and their duly appointed
proxies and corporate representatives are
entitled to be admitted to general meetings.
Limitations on the rights to own shares
There are no limitations on the rights to
own shares.
Major shareholdings
At 31 December 2024, the following persons had disclosed an interest in the issued Ordinary Share capital of the Company in accordance
with the requirements of rules 5.1.2 or 5.1.5 of the UK Financial Conduct Authority’s (FCA) Disclosure Guidance and Transparency Rules.
Changes in the percentage ownerships disclosed by major shareholders are set out below. Major shareholders do not have different
voting rights.
Number of Ordinary Shares disclosed as a percentage of issued share capital at:
Shareholder
Date of the latest
disclosure to
the Company
1
Number of
Ordinary Shares
disclosed
% as at the date of
the latest
disclosure to
the Company
31 December
2022
31 December
2023
31 December
2024
31 January
2025
BlackRock, Inc.
4 December 2009
100,885,181
6.96
6.51
6.51
6.51
6.51
Investor AB
3 April 2019
51,587,810
3.93
3.33
3.33
3.33
3.33
The Capital Group Companies, Inc.
17 July 2018
63,802,495
5.04
4.12
4.12
4.11
4.11
Wellington Management Group LLP
2
21 July 2020
65,120,892
4.96
4.20
4.20
4.20
4.20
Wellington Management Company LLP
2
21 July 2020
65,118,411
4.96
4.20
4.20
4.20
4.20
1
Since the date of disclosure to the Company, the interest of any person listed above in Ordinary Shares may have increased or decreased. No requirement to notify the
Company of any increase or decrease arises unless the holding passes a notifiable threshold in accordance with rules 5.1.2 or 5.1.5 of the UK FCA’s Disclosure Guidance and
Transparency Rules.
2
The Company was notified at the time of the disclosure that Wellington Management Company LLP was a subsidiary of Wellington Management Group LLP and that the
shareholding percentage notified by Wellington Management Company LLP was included within the aggregate shareholding percentage notified by Wellington Management
Group LLP.
So far as the Company is aware, no other person held a notifiable interest in the issued Ordinary Share capital of the Company. No changes
to major shareholdings were disclosed to the Company between 31 December 2024 and 31 January 2025.
So far as the Company is aware, it is neither directly nor indirectly owned or controlled by one or more corporations or by any government.
The Company does not know of any arrangements, the operation of which might result in a change in the control of the Company.
231
AstraZeneca
Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Directors’ Report
•
Make donations to political parties or
independent election candidates.
•
Make donations to political organisations
other than political parties.
•
Incur political expenditure, up to an
aggregate limit of $250,000.
Corporate political contributions in the US
are permitted in defined circumstances
under the First Amendment of the US
Constitution and are subject to both federal
and state laws and regulations. In 2024, the
Group’s US legal entities made contributions
amounting in aggregate to $1,156,800
(2023: $1,687,650) to national political
organisations, state-level political party
committees and to campaign committees of
various state candidates. No corporate
political donations were made at the federal
level and all contributions were made only
where allowed by US federal and state law.
We publicly disclose details of our
corporate US political contributions,
which can be found on our website,
www.astrazeneca-us.com.
The annual corporate contributions budget
is reviewed and approved by the US VP,
Corporate Affairs and the President of our
US business to ensure robust governance
and oversight. US citizens or individuals
holding valid green cards exercised
decision making over the contributions and
the funds were not provided or reimbursed
by any non-US legal entity. Such
contributions do not constitute political
donations or political expenditure for the
purposes of the Companies Act 2006 and
were made without any involvement of
persons or entities outside the US.
Significant agreements
There are no significant agreements to
which the Company is a party that take
effect, alter or terminate on a change of
control of the Company following a takeover
bid. There are no persons with whom we
have contractual or other arrangements,
who are deemed by the Directors to be
essential to our business.
Use of financial instruments
The Notes to the Financial Statements,
including Note 28 from page 194,
include further information on our use
of financial instruments.
Insurance and indemnities
The Company maintained directors’ and
officers’ liability insurance cover throughout
2024. The Directors are also able to obtain
independent legal advice at the expense of
the Company, as necessary, in their
capacity as Directors.
Since 2006, the Company has entered into
a deed of indemnity in favour of each Board
member. These deeds of indemnity are still
in force and provide that the Company shall
indemnify the Directors to the fullest extent
permitted by law and the Articles, in respect
of all losses arising out of, or in connection
with, the execution of their powers, duties
and responsibilities as Directors of the
Company or any of its subsidiaries. This is
in line with current market practice and
helps us attract and retain high-quality,
skilled Directors.
Compliance requirements under UK
Listing Rule 6.6.1
The only matter to report is the shareholder
waiver of dividends on page 231.
Directors’ Report
The Directors’ Report, which has been
prepared in accordance with the
requirements of the Companies Act 2006,
comprises the following sections:
•
Chair’s Statement
•
Chief Executive Officer’s Review
•
Therapy Area Review
•
Business Review
•
Risk Overview
•
Financial Review: Financial risk
management
•
Corporate Governance: including the
Corporate Governance Overview,
Corporate Governance Report,
Nomination and Governance Committee
Report, Science Committee Report,
Sustainability Committee Report and
Audit Committee Report
•
Directors’ responsibility statement
•
Shareholder information
•
Sustainability supplementary information
and has been approved by the Board and
signed on its behalf.
On behalf of the Board
A C N Kemp
Company Secretary
6 February 2025
Stakeholder engagement
The discussion on stakeholder engagement
and the impact of these interactions is
contained in Connecting with our
stakeholders from page 94 and throughout
the Strategic Report. This includes
engagement with our employees, suppliers
and other stakeholders, as well as the
impact of our operations on the community
and environment.
Information on how we encourage
employee involvement in the Company’s
performance is set out in People and
Sustainability from page 47. Details of some
of the employee share plans are described
in the Directors’ Remuneration Report from
page 112, and in Note 29 to the Financial
Statements from page 201. All employees
are provided with information on matters of
concern to them through regular meetings
and updates on the Group’s intranet and
internal social media. ‘Townhall’ meetings
and Q&A sessions are hosted regularly by
members of senior management, including
the SET, including global and targeted
broadcasts on internal social media. During
2024, these broadcasts provided updates
on the business, including pipeline
developments and strategic initiatives, as
well as the Group’s response to global
issues such as climate change. In addition,
information about the Group’s quarterly
results is shared with employees. These
updates inform employees of the financial
and economic factors which affect the
performance of the Group.
Political donations
Neither the Company nor its subsidiaries
made any EU political donations or incurred
any EU political expenditure in 2024 and they
do not intend to do so in the future in respect
of which shareholder authority is required,
or for which disclosure in this Annual Report
is required, under the Companies Act 2006.
However, to enable the Company and its
subsidiaries to continue to support interest
groups or lobbying organisations concerned
with the review of government policy or law
reform without inadvertently breaching the
Companies Act 2006, which defines political
donations and other political expenditure in
broad terms, a resolution will be put to
shareholders at the 2025 AGM, similar to
that passed at the 2024 AGM, to authorise
the Company and its subsidiaries to:
For more information on
dividend distributions, the AGM
and results announcements,
see Financial calendar on
page 228.
For more information on the
Directors, see Board of
Directors on pages 88 and 89.
232
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Annual Report & Form 20-F Information 2024
Additional Information
Directors’ Report
continued
GHG reporting
We have reported on all the emission sources required under Streamlined Energy
and Carbon Reporting (SECR). These sources fall within our Group Financial Statements.
We do not have responsibility for any emission sources that are not included in our
Group Financial Statements.
Global GHG emissions data for the period 1 January 2024 to 31 December 2024
1,2
Unit
2024
2023
2022
Baseline
2015
Scope 1: Combustion of fuel and
operation of facilities
3
Tonnes CO₂e
125,386
180,898
237,703
298,498
Scope 2 (Market-based): Electricity
(net of market instruments), heat,
steam and cooling purchased for
own use
4
Tonnes CO₂e
14,210
19,940
18,491
322,319
Scope 2 (Location-based):
Electricity, heat, steam and cooling
purchased for own use
4
Tonnes CO₂e
217,026
183,332
180,403
266,372
Company’s chosen intensity
measurement: Scope 1 + Scope 2
(Market-based)
Tonnes CO₂e
per million of
Total Revenue
2.58
4.38
5.78
Total energy consumption
5
Megawatt
hours (MWh)
1,676,076
1,733,325
1,828,612
Unit
2024
2023
2022
Baseline
2019
Scope 3 Total: Emissions from all 15
GHG Protocol Scope 3 Categories
6
Tonnes CO₂e
5,897,822
5,917,160
6,330,308
5,722,797
Scope 3 intensity measurement:
Scope 3 emissions from all 15 GHG
Protocol Scope 3 Categories
Tonnes CO₂e
per million of
Total Revenue
109.07
129.16
142.73
1
The Group reports GHG emissions in accordance with the World Resources Institute/World Business Council for
Sustainable Development (WRI/WBCSD) Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard,
Revised Edition (2015) and Corporate Value Chain (Scope 3), Accounting and Reporting Standard (2011).
2
Under the Companies (Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations
2018, the Company needs to disclose what proportion of this figure relates to energy use in the UK and offshore area.
For 2024, the proportion of total global energy and emissions originating from AstraZeneca’s UK and offshore area
footprint were as follows: energy use 245,902 MWh (15%); Scope 1 site energy, non-energy and fleet emissions
20,462 tCO
2
e (16%); Scope 2 site imported energy emissions using Market-based accounting 0 tCO
2
e (0%) and
Scope 2 site imported energy emissions using Location-based accounting 22,195 tCO
2
e (10%). In the period covered
by the Annual Report, AstraZeneca has installed LED lighting, upgraded chillers, improved controls for heating,
ventilation and air conditioning systems, maintained ISO 50001 certification at the Macclesfield facility, UK, and
deployed electric vehicles across the commercial vehicle fleet.
3
Included in this section are GHGs from direct fuel combustion, process and engineering emissions at our sites and
from fuel use in our vehicle fleet. In 2024, 134,695 MWh of biomethane certificates have been purchased globally
and accounted in our Scope 1 GHG reporting with a CO
2
factor of zero. Accounting for this quantity of gas with fossil
fuel CO
2
factors equates to 24,595 tCO
2
e, we account for all non-CO
2
emissions. The UK accounted for 34,431 MWh
of biomethane and 6,285 tCO
2
e. In the UK, Renewable Gas Guarantees of Origin for biomethane are retired through
the Green Gas Certification Scheme. In the US, Renewable Thermal Certificates are tracked via the Midwest
Renewable Energy Tracking System.
4
GHGs from imported electricity are calculated using the GHG Protocol Scope 2 Guidance (January 2015) requiring
dual reporting using two emissions factors for each site – Market-based and Location-based. Our corporate
emissions reporting and targets follow the Market-based approach. Emission factors for electricity have been derived
from the International Energy Agency, US Environmental Protection Agency eGRID, US Green-e and the Association
of Issuing Bodies databases.
5
The aggregate of: (i) the annual quantity of energy consumed from activities for which the Company is responsible,
including the combustion of fuel at a facility; (ii) the annual quantity of energy consumed resulting from the purchase
of electricity, heat, steam or cooling by the Company for its own use; (iii) the combustion of fuel from the commercial
operation of vehicle fleet; and (iv) the annual quantity of energy consumed resulting from the purchase of electricity
to operate Electric Vehicles (EVs) as part of the commercial vehicle fleet.
6
Regular data review is carried out to ensure accuracy, consistency and reflect major business change, which has led
to changes to reported figures in data in previous years. Key changes include (i) from 2023, Scope 3 Category 1,2,4
and 6 – AstraZeneca has changed the source of procurement spend data and classification of spend, which impacts
emissions that are calculated from it (secondary data). In addition, AstraZeneca has integrated the latest version of
Comprehensive Environmental Data Archive (CEDA) emission factors to 2023 data, which reflect decarbonisation that
occurred between 2018 and 2022; (ii) Scope 3 Category 6 – AstraZeneca has identified air travel data that originated
outside its primary travel provider. This data has been incorporated back to the 2019 baseline year; (iii) Scope 3
Category 11 – AstraZeneca has revised prior period manufacture volumes (2022 and 2023) to align with current
reporting methodology. For further information, see our GHG Reporting Methodology document which can be found
on www.astrazeneca.com/sustainability/resources.html.
External assurance
Bureau Veritas has provided independent
external assurance to a limited level on the
following sustainability information
contained within this Annual Report:
•
Positively impacting people, society and
the planet, see page 6.
•
Science and Innovation, Key
Performance Indicators, see page 13
•
People and Sustainability, including
2024 developments and Key
Performance Indicators, see page 15.
•
Sustainable innovation, see page 37.
•
Patient safety and product quality, see
page 38.
•
Business conduct, see pages 42 and 43.
•
Cybersecurity and data privacy, see
page 45.
•
People and Sustainability, Summary and
performance indicators, see page 47.
•
Human rights, see page 48.
•
Workforce safety and health, see
page 48.
•
Talent attraction and retention, see
pages 49 and 50.
•
Sustainability, see page 51.
•
Accessible and affordable healthcare,
see page 52.
•
Climate change, see pages 53 to 57.
•
Pollution, see page 58.
•
Disclosure Statements, including Our
approach to sustainability reporting, UK
statutory sustainability reporting,
EU Corporate Sustainability Reporting
Directive and EU Taxonomy Disclosure,
see pages 59 to 62.
•
Supplementary information, including
GHG reporting, see this page, Material
sustainability metrics definitions, see
pages 234 and 235, Climate risk
scenarios, see page 236 and EU
Taxonomy templates, see pages 237
and 238.
BV
Used throughout this Annual Report
to denote the sustainability
information listed above, which has
been independently assured by
Bureau Veritas.
Material sustainability metrics
independently assured by
Bureau Veritas.
Based on the evidence provided and
subject to the scope, objectives and
limitations defined in the Assurance
Report by Bureau Veritas, nothing has
come to the attention of Bureau Veritas
causing them to believe that the
sustainability information contained within
this Annual Report is materially misstated.
Bureau Veritas is a professional services
company that has a long history of
providing independent assurance services
in environmental, health, safety, social and
ethical management and disclosure.
The Assurance Report, which includes
Bureau Veritas’ scope of work, standard
used, overall opinion, and limitations and
exclusions, is available on our website,
www.astrazeneca.com/sustainability/
resources.html.
For more information, see
Climate change from
page 53.
233
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Corporate Governance
Additional Information
Financial Statements
Strategic Report
Sustainability supplementary information
Sustainability supplementary information
BV
Material sustainability metrics definitions
Definitions and methodology of quantitative metrics used to track the effectiveness of our actions related to managing our material
sustainability topics are detailed below. The metrics cover the Group, unless otherwise stated, and are subject to limited assurance
by Bureau Veritas.
Of the 16 sustainability metrics, three are Key Performance Indicators:
•
Number of pipeline progression events
•
Number of regulatory events
•
Employee belief that AstraZeneca is a great place to work.
Sustainability topic
Metric
Definitions and calculations (if applicable)
Methodology
Sustainable
innovation
See page 37
Number of new molecular entities
(NMEs) approvals
(cumulative)
‘NME approvals’ refers to medicines approved since October
2022 to meet our Ambition 2030.
Data is collected via a monthly
reporting process, captured
on AstraZeneca’s project
planning and forecasting tool,
and maintained by the Global
Portfolio and Project
Management team.
Number of pipeline progression
events
‘Pipeline progression events’ refers to Phase II NME starts/
progressions and Phase III investment decisions.
Number of regulatory events
‘Regulatory events’ refers to submissions or approvals for our
medicines in major markets.
Patient
safety and
product
quality
See page 38
Number of inspections from all
health authorities relating to Good
Manufacturing Practice (GMP)
‘Health authorities’ refers to government agencies that are
responsible for protecting and promoting public health
through the supervision of pharmaceutical products.
‘Inspections’ refers to assessments of manufacturing facilities
and processes for regulated products to verify compliance
with relevant regulations, by health authorities.
‘Good Manufacturing Practice’ (GMP) is part of a quality
management system which ensures that products are
consistently produced and controlled to the quality standards
appropriate to their intended use and as required by the
marketing authorisation. This covers commercial product
manufacture and marketing companies’ Good Distribution
Practice (GDP), products in development going into clinical
trials and device manufacturing.
Inspection is counted once closed and observations have
been received.
Data is captured on an internal
quality management system
by the Operations Quality
Assurance team.
Number of critical findings from
health authorities relating to GMP
‘Critical findings‘ are deficiencies with GMP reported by
health authorities, that provide an immediate and significant
risk to patient safety. A ‘critical finding‘ can also be a
combination or repetition of major findings that indicate a
critical failure of GMP.
Number of product recalls
‘Recalls’ can be initiated at various levels:
•
Level 1 is at wholesale level
•
Level 2 is at pharmacy/hospital level
•
Level 3 is at patient level.
Cyber-
security and
data privacy
See page 45
Number of material cybersecurity
incidents
A ‘material cybersecurity incident’ is defined as
material unauthorised access, disclosure or disruption of
information systems of data that significantly impacts the
confidentiality, integrity or availability of critical assets,
operations or stakeholders.
Data is collected through
incident reports, security logs
and continuous monitoring
tools. Designated
cybersecurity and data privacy
members are responsible for
data collection.
Number of material security
breaches involving personal data
‘Material security breaches’ refers to material unauthorised
access to personal data. A reported breach alone does not
constitute a material breach.
For more information on our
Key Performance Indicators,
see pages 12 to 15.
For more information on
required disclosures under UK
Streamlined Energy and
Carbon Reporting, see
page 233.
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Additional Information
Sustainability supplementary information
continued
BV
Sustainability topic
Metric
Definitions and calculations (if applicable)
Methodology
Talent
attraction
and retention
See from
page 49
Employee belief that AstraZeneca
is a great place to work (%)
‘Employee belief’ refers to the positive response (agree and
tend to agree) to each respective statement in our annual
employee opinion survey, Pulse.
Calculation: Total number of responses that either agree or
tend to agree divided by total number of responses, then
multiplied by 100.
Data is captured annually
through our Pulse survey
conducted by HR and shared
Company-wide.
Employee belief that in the last
12 months, I have improved my
existing skills, or learned new
skills, or had a development
opportunity (%)
Employee overall promotion
rate (%)
‘Promotion’ refers to when an employee advances to a
position that is classified at a higher grade.
Calculation: Total number of promotions made during the
reporting year divided by the average permanent headcount
across those 12 months, then multiplied by 100.
Data is captured in the HR data
insights dashboard by our
Workforce Insights and
Analytics team. The dashboard
uses data automatically pulled
through from our HR data
management systems.
Employee turnover (%)
‘Employee turnover’ refers to the exit of a permanent
employee, including those leaving on a voluntary or
involuntary basis.
Calculation: Total number of permanent exits (voluntary or
involuntary) in the reporting year divided by the average
permanent headcount across those 12 months, then multiplied
by 100.
Climate
change
See from
page 53
Gross Scope 1 and 2
(Market-based) GHG emissions
(tonnes CO
2
e)
This is the combined Scope 1 and Scope 2 (Market-based)
GHG emissions during the reporting period.
‘Scope 1 GHG emissions‘ are direct emissions that occur from
sources that are controlled or owned by AstraZeneca.
‘Scope 2 GHG emissions‘ are indirect emissions from the
generation of purchased energy consumed by AstraZeneca,
and includes electricity and imported steam, imported or
district heat and cooling systems.
‘Market-based‘ refers to factors that are more specific to the
site and local energy market, taking account of the residual
energy mix and any certified renewable power purchased by
a site.
Data is captured through the
centralised Safety, Health and
Environmental reporting
system with consumption data
multiplied by relevant GHG
emission factors in
accordance with the
Greenhouse Gas Protocol:
A Corporate Accounting and
Reporting Standard, Revised
Edition (2015).
Gross Scope 3 GHG emissions
(tonnes CO
2
e)
‘Scope 3 GHG emissions‘ are all indirect emissions
(not included in Scope 2) that occur in the value chain
of AstraZeneca, including both upstream and
downstream emissions.
Data for Scope 3 is
captured from multiple
sources and consolidated into
the 15 categories of Scope 3
according to the Greenhouse
Gas Protocol: Corporate Value
Chain (Scope 3), Accounting
and Reporting Standard (2011).
Scope 1 and 2 (Market-based)
GHG emissions intensity (tonnes
CO
2
e per million of Total Revenue)
Scope 1 and 2 intensity metric normalises the Scope 1 and 2
(Market-based) GHG footprint relative to revenue.
Calculation: Gross Scope 1 and 2 (Market-based) GHG
emissions divided by Total Revenue.
Data is captured through
the centralised Safety,
Health and Environmental
reporting system.
Share of primary activity data in
Scope 3 reporting (%)
‘Primary data‘ is data from specific activities within
AstraZeneca’s value chain.
‘Secondary data‘ is data that is not from specific activities
within AstraZeneca’s value chain.
Calculation: Scope 3 GHG emissions from primary data
divided by total Scope 3 GHG emissions.
For further information, see our GHG Reporting Methodology
document which can be found on www.astrazeneca.com/
sustainability/resources.html.
Supplier data is captured
through several supplier
and third-party systems,
including CDP.
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Corporate Governance
Additional Information
Financial Statements
Strategic Report
Sustainability supplementary information
Climate risk scenarios
To assess the potential impacts of climate change on our business, we have used the scenarios listed below.
Physical risks and temperature scenarios by 2100
Physical climate system conditions represented in the scenario analysis below are based on a set of assumptions about driving forces
(such as demographic and socio-economic development, policymaking, technological change, energy and land use) and their key
relationships that correlate with how the emission pathways impact elements of society or ecosystems.
Scenario
1
Description
Key forces and drivers included in the scenario
Low emission scenario,
+1.8°C (SSP1-RCP2.6)
This scenario lays out a pathway and
emissions trajectory that is aligned with
the objectives of the Paris Agreement to
limit global warming to well below 2°C,
preferably to 1.5°C, by 2100, compared
with pre-industrial levels.
This scenario assumes a rapid transition to a low-carbon economy, reducing
the risk of extreme climate change and its potential hazards (such as sea
level rise, increasing temperatures, extreme weather conditions and loss
of biodiversity).
This is the main scenario used to review climate hazards for our suppliers.
Current trajectory scenario,
+2.7°C (SSP2-RCP4.5)
This is an intermediate scenario with
emissions peaking in 2040 and falling
rapidly thereafter until 2080. Deemed to
be the ‘most likely’ scenario.
In this scenario, the Paris Agreement of keeping temperature increases
‘well below 2°C above pre-industrial levels‘ is breached. This scenario leads
to an increase in the frequency and intensity of extreme weather events,
rising sea levels, loss of biodiversity and other negative consequences of
climate change.
This scenario model assumes a degree of adaptation and mitigation
of emissions, which helps mitigate some hazards compared to more
high-risk scenarios.
As a scenario with high likelihood, metrics to quantify exposure to hazards
in this scenario are shared externally for our sites where deep-dive risk
assessments have been completed.
High emission scenario,
+4.4°C (SSP5-RCP8.5)
This is a worst-case scenario consistent
with no policy changes to reduce
emissions, where CO
2
concentrations in
the atmosphere are approximately
doubled by 2050 and continue to
increase until 2100.
The dangers of a significant and rapid increase in the global average
temperature leads to extreme climate conditions, such as severe warming,
sea level rise, loss of ice masses, changes in precipitation patterns and
increased risk of extreme weather events. This scenario also implies a
high degree of impact on ecosystems and communities, including loss of
biodiversity, altered habitats and disruption of community infrastructure.
It is the most extreme scenario in terms of climate change.
Metrics to quantify exposure to hazards in this scenario are used in
deep-dive risks assessments for certain sites to pressure test how effective
existing mitigations will be in 2030 and 2050. For new projects, data
modelling is used for the full life-cycle of an asset.
1
Key inputs and constraints of the scenarios: In the three scenarios, the main metrics considered to quantify hazards are: heat, cold, fire, flood, wind, convective storms, water scarcity and water quality. Flood depth
estimates assume no existing flood defences.
Transition risks and opportunities scenarios used
Scenario
2
Description
Key forces and drivers included in the scenario
1.7°C (International Energy Agency’s
World Energy Outlook (IEA WEO)
Announced Pledges Scenario (APS) –
equivalent to RCP2.6)
The IEA WEO APS was used as the primary
low-carbon future scenario. As a ‘well below 2°C’
pathway, the APS represents a gateway to the
outcomes targeted by the Paris Agreement.
The APS assumes that governments will meet, in full
and on time, all the climate-related commitments they
have announced, including longer-term net-zero
emissions targets and pledges in Nationally
Determined Contributions.
1. Widespread policy implementation
2. Technological advancements
3. Significant emissions reductions.
1.5°C (IEA WEO Net-Zero Emissions
by 2050 scenario (NZE) – equivalent
to RCP1.9)
The IEA WEO NZE is a normative IEA scenario that
shows a narrow but achievable pathway for the
global energy sector to achieve net-zero CO
2
emissions by 2050, with advanced economies
reaching NZE in advance of others.
1.
Significant low-carbon investment and
policy implementation
2. Rapid decarbonisation
3. Extensive increases in energy efficiency.
2.4°C (IEA WEO Stated Policies Scenario
– (STEPS)
– equivalent to RCP4.5)
The IEA WEO STEPS provides a more conservative
benchmark for the future because it does not take
for granted that governments will reach all
announced goals.
1. Current policy implementation
2. Energy demand growth
3. Widespread fossil fuel use
4. Technological developments.
2
Key inputs and constraints of the scenarios: The three scenarios are used for projections of energy cost, forecasting of carbon price, change in raw material costs and supply-demand of renewable energy to see how
those will relate to our roadmap to net-zero GHG emissions and impact our transition risks and opportunities, and cost of goods and profits.
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Additional Information
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continued
BV
EU Taxonomy templates
Revenue
2024
Substantial contribution criteria
DNSH criteria
(’Do No Significant Harm’)
Economic Activities
Code
Revenue
Proportion of Revenue
Climate Change Mitigation
Climate Change Adaptation
Water
Pollution
Circular Economy
Biodiversity
Climate Change Mitigation
Climate Change Adaptation
Water
Pollution
Circular Economy
Biodiversity
Minimum Safeguards
Proportion of Taxonomy-aligned
(A.1.) or eligible (A.2.
) Revenue 2023
Category enabling activity
Category transitional activity
$m
%
Y;N;
EL;
N/EL
1
Y;N;
EL;
N/EL
Y;N;
EL;
N/EL
Y;N;
EL;
N/EL
Y;N;
EL;
N/EL
Y;N;
EL;
N/EL
Y/N
Y/N
Y/N
Y/N
Y/N
Y/N
Y/N
%
E
T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.2. Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
Manufacture of medicinal products
PPC 1.2
51,861
96
N/EL
N/EL
N/EL
EL
N/EL
N/EL
96²
Revenue of Taxonomy-eligible but not environmentally sustainable activities
(not Taxonomy-aligned activities) (A.2.)
51,861
96
0%
0%
0%
96%
0%
0%
96
A. Revenue of Taxonomy-eligible activities (A.1.+A.2.)
51,861
96
0%
0%
0%
96%
0%
0%
96
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
Revenue of Taxonomy-non-eligible activities
2,212
4
Total
54,073
100
Capex
2024
Substantial contribution criteria
DNSH criteria
(‘Do No Significant Harm’)
Economic Activities
Code
Capex
Proportion of Capex
Climate Change Mitigation
Climate Change Adaptation
Water
Pollution
Circular Economy
Biodiversity
Climate Change Mitigation
Climate Change Adaptation
Water
Pollution
Circular Economy
Biodiversity
Minimum Safeguards
Proportion of Taxonomy-aligned
(A.1.) or eligible (A.2.
) Capex, 2023
Category enabling activity
Category transitional activity
$m
%
Y;N;
EL;
N/EL
Y;N;
EL;
N/EL
Y;N;
EL;
N/EL
Y;N;
EL;
N/EL
Y;N;
EL;
N/EL
Y;N;
EL;
N/EL
Y/N
Y/N
Y/N
Y/N
Y/N
Y/N
Y/N
%
E
T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1. Environmentally sustainable activities (Taxonomy-aligned)
Renovation of existing buildings
CCM 7.2
/CCA 7.2/
CE 3.2
137
2
Y
N
N/EL
N/EL
N/EL
N/EL
Y
Y
Y
Y
Y
Y
Y
0
E
Capex of environmentally sustainable activities
(Taxonomy-aligned)
(A.1.)
137
2
2%
0%
0%
0%
0%
0%
Y
Y
Y
Y
Y
Y
Y
0
Of which Enabling
137
2
2%
0%
0%
0%
0%
0%
Y
Y
Y
Y
Y
Y
Y
0
E
Of which Transitional
0
0
0
T
A.2. Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
Manufacture of medicinal products
PPC 1.2
5,244
68
N/EL
N/EL
N/EL
EL
N/EL
N/EL
65
Construction of new buildings
CCM 7.1
/CCA 7.1/
CE 3.1
542
7
EL
EL
N/EL
N/EL
EL
N/EL
6
Acquisition and ownership of buildings
CCM 7.7
/CCA 7.7
352
5
EL
EL
N/EL
N/EL
N/EL
N/EL
5
Renovation of existing buildings
CCM 7.2
/CCA 7.2/
CE 3.2
167
2
EL
EL
N/EL
N/EL
EL
N/EL
2
Transport by motorbikes, passenger cars
and light commercial vehicles
CCM 6.5
/CCA 6.5
342
4
EL
EL
N/EL
N/EL
N/EL
N/EL
4
Capex of Taxonomy-eligible but not environmentally sustainable activities
(not Taxonomy-aligned activities) (A.2.)
6,647
86
A. Capex of Taxonomy-eligible activities (A.1.+A.2.)
6,784
88
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
Capex of Taxonomy-non-eligible activities
971
12
Total
7,755
100
1
EL – Taxonomy-eligible activity for the relevant environmental objective. N/EL – Taxonomy-non-eligible activity for the relevant environmental objective. Y – Yes, Taxonomy-eligible and Taxonomy-aligned activity
with the relevant environmental objective. N – No, Taxonomy-eligible but not Taxonomy-aligned activity with the relevant environmental objective.
2
Revised (previously: 100%) to reflect eligible revenue being the Group’s Product Sales and sales milestones within Collaboration Revenue.
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Financial Statements
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EU Taxonomy templates
continued
Opex
2024
Substantial contribution criteria
DNSH criteria
(‘Do No Significant Harm’)
Economic Activities
Code
Opex
Proportion of Opex
Climate Change Mitigation
Climate Change Adaptation
Water
Pollution
Circular Economy
Biodiversity
Climate Change Mitigation
Climate Change Adaptation
Water
Pollution
Circular Economy
Biodiversity
Minimum Safeguards
Proportion of Taxonomy-aligned
(A.1.) or eligible (A.2.
) Opex, 2023
Category enabling activity
Category transitional activity
$m
%
Y; N;
EL;
N/EL
1
Y; N;
EL;
N/EL
Y; N;
EL;
N/EL
Y; N;
EL;
N/EL
Y; N;
EL;
N/EL
Y; N;
EL;
N/EL
Y/N
Y/N
Y/N
Y/N
Y/N
Y/N
Y/N
%
E
T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.2. Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
Manufacture of medicinal products
PPC 1.2
2,016
14
N/EL
N/EL
N/EL
EL
N/EL
N/EL
14
2
Renovation of existing buildings
CCM 7.2
/CCA 7.2/
CE 3.2
541
4
EL
EL
N/EL
N/EL
EL
N/EL
3
A. Opex of Taxonomy-eligible activities (A.1.+A.2.)
2,557
18
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
Opex of Taxonomy-non-eligible activities
11,573
82
Total
14,130
100
1
EL – Taxonomy-eligible activity for the relevant environmental objective. N/EL – Taxonomy-non-eligible activity for the relevant environmental objective. Y – Yes, Taxonomy-eligible and Taxonomy-aligned activity
with the relevant environmental objective. N – No, Taxonomy-eligible but not Taxonomy-aligned activity with the relevant environmental objective.
2
Revised (previously: 96%), to reflect eligible R&D expenses associated with functional areas which are involved directly in the manufacture and procurement of medicinal products.
238
AstraZeneca
Annual Report & Form 20-F Information 2024
Additional Information
Sustainability supplementary information
continued
BV
AstraZeneca, the AstraZeneca logotype, and the AstraZeneca symbol are all trade marks of the Group.
The following medicine names which appear in italics in this Annual Report are trade marks of the Group:
Trade mark
Airsupra
Faslodex
Ondexxya
Symlin
Andexxa
Fluenz
Onglyza
Synagis
4
Bevespi Aerosphere
FluMist
Orpathys
Tagrisso
Breztri
Forxiga
Plendil
2
Toprol-XL
Breztri Aerosphere
Imfinzi
Prilosec
Trixeo
Brilinta
Imjudo
Pulmicort
Trixeo Aerosphere
Brilique
Kanuma
Pulmicort
Flexhaler
Truqap
Bydureon
Kavigale
Qtern
Ultomiris
Calquence
Kombiglyze
Saphnelo
Vaxzevria
Crestor
Koselugo
Seloken
Voydeya
Daliresp
Losec
1
Seroquel
3
Wainua
Daxas
Lokelma
Seroquel
XR
3
Wainzua
Evusheld
Lynparza
Soliris
Xigduo
Farxiga
Movantik
Strensiq
Zoladex
Fasenra
Nexium
Symbicort
1
AstraZeneca divested certain trademark rights to Cheplapharm effective 30 September 2019. AstraZeneca retains rights in a limited number of countries.
2
Effective 18 May 2022, AstraZeneca divested
Plendil
in 35 markets to Glenwood.
3
AstraZeneca divested certain trademark rights to Cheplapharm effective 13 December 2019 and other trademark rights to Luye effective 14 July 2021. AstraZeneca retains rights
in a limited number of other countries.
4
Effective 25 January 2019, AstraZeneca sold its rights to
Synagis
in the US to Sobi. AbbVie Inc. transferred its ownership rights to this trademark to MedImmune LLC, effective
1 July 2021.
The following medicine names, which appear in italics in this Annual Report, are trade marks licensed to the Group by the entities set
out below:
Trade mark
Licensor or Owner
Beyfortus
Sanofi Pasteur Inc.
Datroway
Daiichi Sankyo Company, Limited
Duaklir
Almirall, S.A.
Enhertu
Daiichi Sankyo Company, Limited
Tezspire
Amgen Inc.
Tudorza
Almirall, S.A.
239
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Annual Report & Form 20-F Information 2024
Corporate Governance
Additional Information
Financial Statements
Strategic Report
Trade Marks
Trade Marks
Market definitions
1
Region
Country
US
US
Europe
Austria*
Finland
Italy
Portugal
UK
Belgium
France
Latvia*
Romania
Bulgaria
Germany
Lithuania*
Serbia and Montenegro*
Croatia
Greece
Luxembourg*
Slovakia*
Cyprus*
Hungary
Malta*
Slovenia*
Czech Republic
Iceland*
Netherlands
Spain
Denmark
Ireland
Norway
Sweden
Estonia*
Israel*
Poland
Switzerland
Established RoW
Australia
Canada
Japan
New Zealand*
Emerging Markets
Algeria
Costa Rica
Kuwait
Philippines
United Arab Emirates
Argentina
Dominican Republic
Lebanon
Qatar*
Uruguay*
Aruba*
Ecuador*
Libya*
Russia
Uzbekistan*
Bahamas*
Egypt
Malaysia
Saudi Arabia
Venezuela*
Bahrain*
El Salvador
Maldives*
Singapore
Vietnam
Barbados*
Georgia*
Mexico
South Africa
Yemen*
Belarus*
Guatemala
Moldova*
South Korea
Bermuda*
Honduras
Mongolia*
Sri Lanka
Brazil
Hong Kong
Morocco
Sudan*
Brunei*
India
Nicaragua
Syria*
Cambodia*
Indonesia
Oman*
Taiwan
Chile
Iran*
Other Africa
2
Thailand
Cayman Islands*
Iraq*
Pakistan*
Trinidad and Tobago*
China
Jamaica*
Palestine*
Tunisia*
Cuba*
Jordan
Panama
Turkey
Colombia
Kazakhstan
Peru
Ukraine
*
Q3 2024 IQVIA and IQVIA Midas Quantum Q3 2024 data are not available or AstraZeneca does not subscribe for IQVIA quarterly data for these countries.
1
The above table is not an exhaustive list of all the countries in which AstraZeneca operates and excludes countries with revenue in 2024 of less than $1 million.
2
Other Africa includes Angola, Botswana, Ethiopia, Ghana, Kenya, Mauritius, Mozambique, Namibia, Nigeria, Eswatini, Tanzania, Uganda, Zambia and Zimbabwe.
US equivalents
Terms used in this Annual Report
US equivalent or brief description
Accruals
Accrued expenses
Called-up share capital
Issued share capital
Earnings
Net income
Employee share schemes
Employee stock benefit plans
Fixed asset investments
Non-current investments
Freehold
Ownership with absolute rights in perpetuity
Loans
Long-term debt
Prepayments
Prepaid expenses
Profit
Income
Share premium account
Additional paid-in capital or paid-in surplus (not distributable)
Short-term investments
Redeemable securities and short-term deposits
Trade payables
Accounts payable
Trade receivables
Accounts receivable
240
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Annual Report & Form 20-F Information 2024
Additional Information
Glossary
CKD
– chronic kidney disease.
CLDN 18.2
– a positive therapeutic target in gastric cancer.
CLL
– chronic lymphocytic leukaemia.
Company or Parent Company
– AstraZeneca PLC (formerly Zeneca
Group PLC (Zeneca)).
COPD
– chronic obstructive pulmonary disease.
CRT
– chemoradiotherapy.
CSPC
– CSPC Pharmaceutical Group Ltd.
CSRD
– Corporate Sustainability Reporting Directive.
CTLA-4
– cytotoxic T-lymphocyte-associated antigen-4.
CV
– cardiovascular.
CVRM
– Cardiovascular, Renal & Metabolism.
Daiichi Sankyo
– Daiichi Sankyo, Inc. or a company within the
Daiichi Sankyo group of companies.
Director
– a director of the Company.
dMMR
– deficient mismatch repair.
DTR
– UK Disclosure Guidance and Transparency Rules.
EBITDA
– Reported Profit before tax plus net finance expense,
share of after tax losses of joint ventures and associates and
charges for depreciation, amortisation and impairment.
EFPIA
– European Federation of Pharmaceutical Industries and
Associations.
EGFR
– epidermal growth factor receptor.
EGFRm
– EGFR-mutated.
EMA
– European Medicines Agency.
EPS
– earnings per share: profit for the year after tax and
non-controlling interests, divided by the weighted average
number of Ordinary Shares in issue during the year.
ESG
– environmental, social and governance.
ESMO
– European Society for Medical Oncology.
EVP
– Executive Vice-President.
EU
– the European Union.
F-gas
– fluorinated greenhouse gases include: hydrofluorocarbons
(HFCs), perfluorocarbons (PFCs) and sulphur hexafluoride (SF
6
).
FDA
– the US Food and Drug Administration, which is part of the
US Department of Health and Human Services Agency, which is the
regulatory authority for all pharmaceuticals (including biologics and
vaccines) and medical devices in the US.
FRC
– the UK Financial Reporting Council.
Fusion
– Fusion Pharmaceuticals Inc.
FX
– foreign exchange.
GAAP
– Generally Accepted Accounting Principles.
gBRCAm
– germline BRCA1/2 mutations.
GHG
– greenhouse gas.
GIA
– the Group’s Internal Audit function.
gMG
–
generalised myasthenia gravis.
Gracell
– Gracell Biotechnologies Inc.
Group
– AstraZeneca PLC and its subsidiaries.
GSK
– GSK plc.
GWP
– Global Warming Potential.
The following abbreviations and expressions have the meanings
given below when used in this Annual Report:
Acerta Pharma
– Acerta Pharma B.V.
ACS
– acute coronary syndromes.
ADC(s)
– antibody drug conjugate(s).
ADRs
– American Depositary Receipts.
ADSs
– American Depositary Shares.
AGM
– Annual General Meeting of the Company.
AI
– artificial intelligence.
AI Hallucination
– when an AI produces false or misleading
information.
AKT1
– serine/threonine protein kinase 1.
Alexion
– Alexion Pharmaceuticals, Inc.
ALK
– anaplastic lymphoma kinase.
Amgen
– Amgen Inc.
Amolyt Pharma
– Amolyt Pharma SAS.
Annual Report
– this Annual Report and Form 20-F
Information 2024.
API
– active pharmaceutical ingredient.
Articles
– the Articles of Association of the Company.
ASCO
– American Society of Clinical Oncology.
Astra
– Astra AB, being the company with whom the Company
merged in 1999.
AstraZeneca
– the Company and its subsidiaries.
ATTR
– transthyretin amyloidosis.
ATTR-CM
– transthyretin-mediated amyloid cardiomyopathy.
ATTRv
– hereditary transthyretin-mediated amyloidosis.
ATTRv-PN
– hereditary transthyretin-mediated amyloidosis
with polyneuropathy.
biologic(s) or biologic medicine(s)
– a class of drugs that are
produced in living cells.
BMS
– Bristol-Myers Squibb Company.
Board
– the Board of Directors of the Company.
BRCA
– BReast CAncer gene.
BRCAm
– BRCA-mutated.
BTC
– biliary tract cancer.
Bureau Veritas
– Bureau Veritas UK Limited.
Capex
– capital expenditure.
CAR-T
– therapeutic chimeric antigen receptor.
CDP (formerly the Carbon Disclosure Project)
– a not-for-profit
organisation that runs the global disclosure system for investors,
companies, cities, states and regions to manage their
environmental impacts.
Cellectis
– Cellectis S.A.
CEO
– the Chief Executive Officer of the Company.
CER
– constant exchange rates.
CFO
– the Chief Financial Officer of the Company.
Cheplapharm
– Cheplapharm Arzneimittel GmbH.
CinCor
– CinCor Pharma, Inc.
241
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Corporate Governance
Additional Information
Financial Statements
Strategic Report
Glossary
NSCLC
– non-small cell lung cancer.
NT-proBNP
- N
-terminal pro B-type natriuretic peptide.
oPCSK9
– oral proprotein convertase subtilisin/kexin type 9.
Operating profit
– Total Revenue, less cost of sales, less operating
costs, plus operating income.
Opex
– operating expenditure.
Ordinary Share
– an ordinary share of $0.25 each in the share
capital of the Company.
Orphan Drug
– a drug that has been approved for use in a
relatively low-incidence indication (an orphan indication) and
has been rewarded with a period of market exclusivity; the period
of exclusivity and the available orphan indications vary between
markets.
OS
– overall survival.
PAAGR
– post Alexion Acquisition Group Review.
Paediatric Exclusivity
– in the US, a six-month period of exclusivity
to market a drug which is awarded by the FDA in return for certain
paediatric clinical studies using that drug. This six-month period
runs from the date of relevant patent expiry. Analogous provisions
are available in certain other territories (such as European
Supplementary Protection Certificate paediatric extensions).
PARP
– an oral poly (ADP-ribose) polymerase.
PD-1
– programmed cell death protein 1.
PD-L1
– an anti-programmed death-ligand 1.
Pfizer
– Pfizer, Inc.
PFS
– progression-free survival. The length of time during and after
the treatment of a disease, such as cancer, that a patient lives with
the disease without it getting worse.
Phase I
– the phase of clinical research where a new drug or
treatment is tested in small groups of people (20 to 80) to check
that the drug can achieve appropriate concentrations in the body,
determine a safe dosage range and identify side effects. This phase
includes healthy volunteer studies.
Phase II
– the phase of clinical research which includes the
controlled clinical activities conducted to evaluate the effectiveness
of the drug in patients with the disease under study and to begin to
determine the safety profile of the drug. Phase II studies are
typically conducted in small- or medium-sized groups of patients
and can be divided into Phase IIa studies, which tend to be
designed to assess dosing requirements, and Phase IIb studies,
which tend to assess safety and efficacy.
Phase III
– the phase of clinical research which is performed to
gather additional information about effectiveness and safety of the
drug, often in a comparative setting, to evaluate the overall benefit/
risk profile of the drug. Phase III studies usually include between
several hundred and several thousand patients.
PIK3CA
– phosphatidylinositol-4,5-bisphosphate 3-kinase, catalytic
subunit alpha.
pMDI
– pressurised metered-dose inhaler.
pMMR
– proficient mismatch repair.
PNH
– paroxysmal nocturnal haemoglobinuria.
pound sterling, £, GBP or pence
– references to the currency of the UK.
primary care
– general healthcare provided by physicians who
ordinarily have first contact with patients and who may have
continuing care for them.
Product Sales Gross Margin
– the margin, as a percentage, by
which sales exceed the cost of sales, calculated by dividing the
difference between the two by the sales figure.
HCC
– hepatocellular carcinoma.
HER2
– human epidermal growth factor receptor 2.
HF
– heart failure.
HK
– hyperkalaemia.
hMPV
– human metapneumovirus.
HRD
– homologous recombination repair deficiency.
HRR
– homologous recombination repair.
IAS
– International Accounting Standards.
IASB
– International Accounting Standards Board.
Icosavax
– Icosavax, Inc.
IFRS
– International Financial Reporting Standards or International
Financial Reporting Standard, as the context requires.
Innate Pharma
– Innate Pharma S.A.
Ionis
– Ionis Pharmaceuticals, Inc.
IP
– intellectual property.
IQVIA
– IQVIA Solutions HQ Limited.
IS
– information services.
IT
– information technology.
KPI
– Key Performance Indicator.
krona, kronor or SEK
– references to the currency of Sweden.
LABA
– long-acting beta2-agonist.
LAL
– lysosomal acid lipase.
LAMA
– long-acting muscarinic antagonist.
LCA
– Life-Cycle Assessment.
LCM
– significant life-cycle management projects (as determined
by potential revenue generation), or line extensions.
LRTD
– lower respiratory tract disease.
mAb
– monoclonal antibody, a biologic that is specific, meaning it
binds to and modulates one particular antigen.
major market
– US, Europe, Japan and China.
MASH
– metabolic dysfunction-associated steatohepatitis,
previously NASH.
MAT
– moving annual total.
MCL
– mantle cell lymphoma.
mCRPC
– metastatic castration-resistant prostate cancer.
MedImmune
– MedImmune, LLC (formerly MedImmune, Inc.).
MET
– a tyrosine kinase receptor.
mHSPC
– metastatic hormone-sensitive prostate cancer.
Moderna
– Moderna Therapeutics, Inc.
MSD
– Merck & Co., Inc., (which is known as Merck in the US and
Canada, and MSD in other territories).
n/a
– not applicable.
n/m
– not meaningful.
Nasdaq
– Nasdaq Global Select Market.
Nasdaq Stockholm
– previously the Stockholm Stock Exchange.
Neogene
– Neogene Therapeutics Inc.
NME
– new molecular entity.
NMOSD
– neuromyelitis optica spectrum disorder.
242
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Annual Report & Form 20-F Information 2024
Additional Information
Glossary
continued
SET
– Senior Executive Team.
SG&A
– selling, general and administrative expenses.
SLE
– systemic lupus erythematosus.
siRNA
– small interfering RNA.
SixPeaks Bio
– SixPeaks Bio AG.
Sobi
– Swedish Orphan Biovitrum AB.
SGLT2
– sodium-glucose cotransporter 2.
SPC
– supplementary protection certificate.
specialty care
– specific healthcare provided by medical specialists
who do not generally have first contact with patients.
SoC
– standard of care. Treatment that is accepted by medical
experts as a proper treatment for a certain type of disease and that
is widely used by healthcare professionals.
SVP
– Senior Vice-President.
T2D
– type 2 diabetes.
TCFD
– Task Force on Climate-related Financial Disclosures.
TCR-T
– T-cell receptor therapies.
TKI
- tyrosine kinase inhibitor.
Total Revenue
– the sum of Product Sales, Collaboration Revenue
and Alliance Revenue.
Treg
– T-regulator.
TROP2
– trophoblast cell-surface antigen 2.
TSLP
– thymic stromal lymphopoietin.
TSR
– total shareholder return, being the total return on a share over
a period of time, including dividends reinvested.
uHCC
– unresectable hepatocellular carcinoma.
UK
– United Kingdom of Great Britain and Northern Ireland.
UK Corporate Governance Code
– the UK Corporate Governance
Code published by the FRC in July 2018, as amended, that sets out
standards of good practice in corporate governance for the UK.
US
– United States of America.
US dollar, US$, USD or $
– references to the currency of the US.
V&I
– Vaccines & Immune Therapies.
VBP
– value-based procurement.
WHO
– World Health Organization, the United Nations’ specialised
agency for health.
YTE
– A technology that introduces the so-called YTE (amino acid)
mutation into the antibody, which prolongs the antibody’s half-life.
PROTACs
– a proteolysis targeting chimera, which is a
heterobifunctional small molecule composed of two active domains
and a linker capable of removing specific unwanted proteins.
PSMA
– prostate-specific membrane antigen.
PTEN
– phosphatase and tensin homolog.
Pulse survey
– an AstraZeneca employee opinion survey, which
seeks employees’ views of the business.
PwC
– PricewaterhouseCoopers LLP.
R&D
– research and development.
R&I
– Respiratory & Immunology.
rare disease
– the EU defines a disease or condition as rare if it
affects fewer than 1 in 2,000 people within the general population
and in the US, the Orphan Drug Act defines a rare disease as a
disease or condition that affects less than 200,000 people in
the US.
Redeemable Preference Shares
– a redeemable preference share
of £1 each in the share capital of the Company.
RCPs
– Representative Concentration Pathways.
RNA
– ribonucleic acid.
Roche
– F. Hoffmann-La Roche AG.
RoW
– rest of world.
RSV
– respiratory syncytial virus.
Sanofi
– Sanofi S.A./Sanofi Pasteur, Inc.
Sarbanes-Oxley Act
– the US Sarbanes-Oxley Act of 2002.
SBTi
– science-based targets initiative.
SBTs
– science-based targets.
SCLC
– small cell lung cancer.
Scope 1
– Combustion of fuel and operation of facilities.
Scope 2
– (Market-based): Electricity
(net of market instruments),
heat, steam and cooling purchased for own use. (Location-based):
Electricity, heat, steam and cooling purchased for own use.
Scope 3
– Total: Emissions from all 15 GMG Protocol Scope 3
categories
SEC
– the US Securities and Exchange Commission, the
governmental agency that regulates the US securities industry and
stock markets.
SEK
– Swedish krona (or kronor).
243
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Corporate Governance
Additional Information
Financial Statements
Strategic Report
Glossary
•
the risk of failure to collect and manage
data and AI in line with legal and
regulatory requirements and strategic
objectives
•
the risk of failure to attract, develop,
engage and retain a diverse, talented and
capable workforce
•
the risk of failure to meet our
sustainability targets, regulatory
requirements or stakeholder expectations
with respect to the environment
•
the risk of the safety and efficacy of
marketed medicines being questioned
•
the risk of adverse outcome of litigation
and/or governmental investigations
•
intellectual property-related risks to the
Group’s products
•
the risk of failure to achieve strategic
plans or meet targets or expectations
•
the risk of failure in financial control or the
occurrence of fraud
•
the risk of unexpected deterioration in the
Group’s financial position
•
the impact that global and/or geopolitical
events may have or continue to have on
these risks, on the Group’s ability to
continue to mitigate these risks, and on
the Group’s operations, financial results
or financial condition.
Certain of these factors are discussed in
more detail, without limitation, in the Risk
Supplement available on our website,
www.astrazeneca.com/annualreport2024,
and reproduced in AstraZeneca’s Form 20-F
filing for 2024, available on the SEC website
www.sec.gov. Nothing in this Annual Report
should be construed as a profit forecast.
Inclusion of Reported performance,
Core financial measures and constant
exchange rate growth rates
AstraZeneca’s determination of non-GAAP
measures, together with our presentation of
them within our financial information, may
differ from similarly titled non-GAAP
measures of other companies.
Statements of competitive position,
growth rates and sales
In this Annual Report, except as otherwise
stated, market information regarding the
position of our business or products relative
to its or their competition is based upon
published statistical sales data for the 12
months ended 30 September 2024 obtained
from IQVIA, a leading supplier of statistical
data to the pharmaceutical industry. Unless
otherwise noted, for the US, dispensed new
or total prescription data and audited sales
data are taken, respectively, from IQVIA
National Prescription Audit and IQVIA
National Sales Perspectives for the 12
months ended 30 September 2024; such
data are not adjusted for Medicaid and
similar rebates. Except as otherwise stated,
these market share and industry data from
IQVIA have been derived by comparing our
sales revenue with competitors’ and total
market sales revenues for that period, and
except as otherwise stated, growth rates
are given at CER. For the purposes of this
Annual Report, unless otherwise stated,
references to the world pharmaceutical
market or similar phrases are to the 58
countries contained in the IQVIA database,
which amounted to approximately 95%
(in value) of the countries audited by IQVIA.
Changes in data subscriptions, exchange
rates and subscription coverage, as well
as restated IQVIA data, have led to the
restatement of total market values for
prior years.
AstraZeneca websites
Information on or information accessible
through our websites, including
www.astrazeneca.com,
www.astrazenecaclinicaltrials.com and on
any websites referenced in this Annual
Report, does not form part of and is not
incorporated into this Annual Report.
External/third-party websites
Information on or information accessible
through any third-party or external website
does not form part of and is not
incorporated into this Annual Report.
Figures
Figures in parentheses in tables and in the
Financial Statements are used to represent
negative numbers.
Supplements
For detailed information on our
Development Pipeline, Patent Expiries of
Key Marketed Products and Risk, see our
website, www.astrazeneca.com/
annualreport2024.
Cautionary statement regarding
forward-looking statements
The purpose of this Annual Report is to
provide information to the members of the
Company. The Company and its Directors,
employees, agents and advisers do not
accept or assume responsibility for any
other person to whom this Annual Report
is shown or into whose hands it may come
and any such responsibility or liability is
expressly disclaimed. In order, among
other things, to utilise the ‘safe harbour’
provisions of the US Private Securities
Litigation Reform Act of 1995 and the UK
Companies Act 2006, we are providing
the following cautionary statement:
This Annual Report contains certain
forward-looking statements with respect to
the operations, performance and financial
condition of the Group, including, among
other things, statements about expected
revenues, margins, earnings per share or
other financial or other measures. Forward-
looking statements are statements relating
to the future which are based on information
available at the time such statements are
made, including information relating to risks
and uncertainties. Although we believe that
the forward-looking statements in this
Annual Report are based on reasonable
assumptions, the matters discussed in the
forward-looking statements may be
influenced by factors that could cause
actual outcomes and results to be
materially different from those predicted.
The forward-looking statements reflect
knowledge and information available at the
date of the preparation of this Annual Report
and the Company undertakes no obligation
to update these forward-looking statements.
We identify the forward-looking statements
by using the words ‘anticipates’, ‘believes’,
‘expects’, ‘intends’ and similar expressions
in such statements. Important factors that
could cause actual results to differ
materially from those contained in forward-
looking statements, certain of which are
beyond our control, include, among
other things:
•
the risk of failure or delay in delivery of
pipeline or launch of new medicines
•
the risk of failure to meet regulatory or
ethical requirements for medicine
development or approval
•
the risk of failures or delays in the quality
or execution of the Group’s commercial
strategies
•
the risk of pricing, affordability, access
and competitive pressures
•
the risk of failure to maintain supply of
compliant, quality medicines
•
the risk of illegal trade in our Group’s
medicines
•
the impact of reliance on third-party
goods and services
•
the risk of failure in IT or cybersecurity
•
the risk of failure of critical processes
244
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Additional Information
Important information for readers of this Annual Report
Design and production
Design Bridge and
Partners, London.
www.designbridge.com
Board photography
Igor Emmerich
Marcus Lyon
Alex Telfer
SET photography
Scott Nibauer
Philip Mynott
Ossi Piispanen
Vanguard site
photography
Todd Balfour
This Annual Report is printed on
Revive Silk 100 paper, manufactured
from FSC® Recycled certified fibre
derived from 100% pre- and
post-consumer waste and Carbon
Balanced with the World Land Trust.
Printed in the UK by Pureprint using
its pureprint® environmental printing
technology, and vegetable inks were
used throughout. Pureprint is a
CarbonNeutral® company. Both the
manufacturing mill and the printer are
registered to the Environmental
Management System ISO14001 and
are FSC® chain-of-custody certified.
Registered office and
corporate headquarters
AstraZeneca PLC
Cambridge Biomedical Campus
Cambridge CB2 0AA
Tel: +44 (0)20 3749 5000
This Annual Report is also available on our website,
www.astrazeneca.com/annualreport2024