Summary

• AstraZeneca cooperating with Chinese authorities

• Update on investigation reassures market

• Potential fines of 1-5 times unpaid tax

• Company forecasts robust 2025 growth

AstraZeneca shares rose 3% on Thursday after the drugmaker said it could face a fine of up to $4.5 million in China over suspected unpaid import taxes for two cancer drugs, reassuring analysts and investors that the business impact would be minor.

The company said that, to the best of its knowledge, the taxes related to the drugs Imfinzi and Imjudo, adding that it continued to cooperate with authorities.

A fine of between one and five times the unpaid tax of $900,000 could be levied if the company is found liable, AstraZeneca said in its fourth-quarter earnings statement, where it also forecast 2025 sales above analyst expectations.

Investors and analysts were on the lookout for an update on ongoing Chinese probes into the company's business there. China is the crown jewel of its international business, accounting for 12% of total sales in 2024.

Redburn Atlantic analyst Simon Baker said the update on the import investigation was "very reassuring" and confirmed that likely financial penalties "would be a fraction of the extreme scenarios discounted in the stock last year".

Last December, the company named Iskra Reic as its new international executive vice president, who took over from Leon Wang in efforts to stabilise operations in China after Wang was detained by Chinese authorities in October.

Wang's arrest was followed by other revelations, including that more than 100 former sales staff in China had been sentenced to jail time in a large medical insurance fraud case.

In November, the company reported a third investigation in China involving two current and two former senior executives, relating to imports of AstraZeneca cancer drugs from Hong Kong. It has said the investigation targeted the individuals only, not the company.

AstraZeneca's shares plunged after the news of Wang's detention, wiping about $18 billion off the company's value. They have since recovered and are up about 10% this year, including Thursday's gains.

The company said that 2025 revenue was expected to increase by a high single-digit percentage, with core earnings projected to grow by a low double-digit percentage.

Analysts are expecting 2025 sales growth of 6.5% and profit to rise by 12.6%, an LSEG poll of analysts shows.