AstraZeneca plc (AZN) - Get Report shares traded sharply higher Thursday after the U.K.-based drugmaker posted stronger-than-forecast fourth quarter earnings, and said 2019 revenues would continue to rise, thanks to increasing demand for its key cancer treatments.

AstraZeneca said earnings for the three months ending in December slipped 22% from the same period last year to 82 cents per share, but still topped the Street consensus forecast of 73 cents. Group revenues, the drugmaker said, rose 11% to $6.417 billion and just ahead of analysts' forecasts of $6.25 billion. Oncology drug sales led the advance, AstraZeneca said, rising 50% to just over $6 billion for the year, lead by its lung cancer treatment Tagrisso,  a key challenger to Merck & Co.s (MRK) - Get Report potential blockbuster drug Ketruda. 

Looking into 2019, the company said core earnings, which hit $3.46 per share last year, would continue to grow at a faster pace than product revenues, and should come in between $3.50 and $3.70 per share. 

"Closing the year with another strong quarter, our performance confirmed that AstraZeneca has returned to growth. Our new medicines performed particularly well across the therapy areas and the Emerging Markets business went from strength to strength," said CEO Pascal Soriot. "2019 will be a year of focus on continued pipeline delivery and flawless commercial execution."

"The performance of our new medicines demonstrated the ability of our commercial teams to convert the pipeline into successful medicines," he added.

AstraZeneca's U.S.-listed shares were marked 5.63% higher in pre-market trading Thursday, indicating an opening bell price of $38.64 each. Its London-listed shares rose 4.4% by mid-morning to change hands at 5,975 pence each, the highest since January 9.

Earlier this month, Merck posted moderately stronger-than-expected fourth quarter earnings and issued robust profit guidance for 2019 as sales of its key Keytruda cancer drug topped estimates.

Group sales, Merck said, rose 5% to $11 billion, just ahead of the $10.97 billion estimate. However, Keytruda sales rose 64% from last year to $2.15 billion, again beating the consensus forecast of $2.12 billion.

Merck said it sees non-GAAP earnings of between $4.57 and $4.72 per share on worldwide sales of between $43.2 billion and $44.7 billion in 2019, both topping estimates compiled by Refinitiv.

"The fourth-quarter and full-year results further bolster our confidence in Merck's innovation-based strategy in which our key pillars - oncology, vaccines, animal health, and select hospital and specialty care products - are expected to drive sustainable growth over the long-term," said CEO Ken Frazier. "We enter 2019 with good momentum, anticipating the many opportunities afforded by our broad and differentiated portfolio and pipeline."

Merck shares were indicated 0.2% lower in pre-market trading Thursday at $78.86 each but have risen nearly 6% since topping Street earnings forecasts on February 2.