AstraZeneca Profits Rise

Sales are also up.
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AstraZeneca

(AZN) - Get Report

said Monday that healthy gains in first-quarter sales and profits put the company on track to meet its full-year goals.

For the three months ended March 31, AstraZeneca earned $1.56 billion, or $1.02 a share, on revenue of $6.97 billion. The earnings included a 4-cent charge for restructuring.

"This constitutes a good start to the year," said CEO David Brennan, on a day when the earnings news was overshadowed by a $15.6 billion bid for

MedImmune

(MEDI)

.

AstraZeneca also dropped out of a high-profile collaboration with

AtheroGenics

(AGIX)

on a heart-disease drug because a clinical trial failed to meet its goal. During the quarter, AstraZeneca took an $83 million charge for the deal.

For the 2006 first quarter, it earned $1.42 billion, or 90 cents a share, on revenue of $6.18 billion. When factoring in exchange rates, first-quarter 2007 sales rose 9% over the year-ago quarter while earnings per share gained 14%.

As has been the case for many quarters, AstraZeneca's forecast is complicated by a U.S. patent battle involving the blood-pressure drug Toprol-XL. Although one dosage strength is already subject to generic competition, "the timing of entry to the markets of other proposed generic products is difficult to predict," AstraZeneca said.

The company sells four dosage strengths, and the version under generic attack has accounted for 20% of the drug's sales in the past. AstraZeneca argues that Toprol-XL should be protected until September. Worldwide sales for Toprol-XL slipped 4% to $444 million on a constant exchange-rate basis in the first quarter, while the U.S. component fell 7% to $331 million.

Among other major products, sales of the schizophrenia drug Seroquel gained 13% to $923 million for the first quarter.

Earlier in the month, AstraZeneca sued the Sandoz generic-drug unit of

Novartis

(NVS) - Get Report

, alleging U.S. patent infringement on Seroquel. Another patent suit is pending against

Teva Pharmaceutical Industries

(TEVA) - Get Report

. No generic versions of Seroquel are sold in the U.S.

Sales of the heartburn treatment Nexium rose 8% to $1.31 billion. Worldwide sales of the cholesterol drug Crestor jumped 59% to $628 million, while U.S. sales grew 56% to $343 million.

Like other brand-name cholesterol fighters, Crestor must cope with managed care companies and insurers that are encouraging doctors and patients to choose generic drugs, most notably copies of

Merck's

(MRK) - Get Report

Zocor. Merck's drug lost U.S. patent protection in mid-2006.

Other first-quarter stars for AstraZeneca include Pulmicort, for asthma, whose sales rose 20% to $401 million and Symbicort, also for asthma, whose sales rose 19% to $354 million. The company said it will start marketing Symbicort in the U.S. by mid-year.