AstraZeneca's shares on the London Stock Exchange experienced a significant decline of 8.4 percent due to concerns over an ongoing investigation in China.
The investigation focuses on allegations of aggressive sales tactics for AstraZeneca's oncology drugs, particularly Tagrisso and Imjudo. The company's local president, Leon Wang, is under investigation and cooperating with Chinese authorities. This has raised concerns among investors about AstraZeneca's stability in the region.
The investigation's implications are significant as it indicates increased oversight of AstraZeneca's activities in China by Beijing. Approximately 13 percent of AstraZeneca's revenues come from China. This situation is similar to past challenges faced by pharmaceutical companies in China, such as GlaxoSmithKline's bribery case in 2014. AstraZeneca's stock decline reflects broader market anxieties.
AstraZeneca had recently revised its growth estimates upward, aiming for $80 billion in total sales by 2030. However, the investigation's financial fallout is uncertain. AstraZeneca has stated that its operations in China are functioning smoothly and has refrained from commenting on speculative media reports. The company is committed to cooperating fully with Chinese authorities if requested.
This investigation is part of a trend of increased regulatory scrutiny faced by foreign pharmaceutical companies in China. AstraZeneca's ability to adapt to regulatory changes and maintain its competitive edge will be crucial for its long-term success in the global market.