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LONDON---Strong sales of established drugs such as Nexium for ulcers and Seroquel for schizophrenia will mean AstraZeneca delivers a healthy 33 percent rise in 2006 earnings on Thursday, a Reuters poll showed.
But the outlook for 2007 is likely to be more cautious, as cheap, copycat competition to heart drug Toprol XL in the United States weighs on profit margins.
AstraZeneca (AZN.L: Quote, Profile , Research), Europe's third-biggest maker of prescription medicines, is expected to post 2006 earnings per share of $3.86, up from $2.91 in 2005, according to the average forecast of 19 analysts. The mean forecast for 2007 is currently $4.08.
A procession of failures in late stage clinical trials, stretching from anti-clot pill Exanta in 2004 to stroke drug NXY-059 last year, have led the Anglo-Swedish drugmaker to embark on a spending spree to rebuild its pipeline of new drugs.

Recent deals have included a tie-up on two diabetes drugs with Bristol-Myers Squibb that could cost more than $1 billion (510 million pounds) and analysts will be looking for clues on how much more AstraZeneca plans to spend.
Crucial to the stock's near-term performance will be results of a Phase III trial, due next month, on an experimental heart disease drug it is developing with AtheroGenics.

AstraZeneca agreed in December 2005 to pay AtheroGenics up to $1 billion for exclusive rights to the drug, known as AGI-1067. But the project is viewed as high risk and many analysts fear it could become the latest failure.
One bright spot within the results could be sales of cholesterol fighter Crestor which, after a slow start, has been winning increased market share since trial results last year showed it can reverse the build-up of the plaque inside arteries that leads to heart attacks.
AstraZeneca shares have performed broadly in line with European peers over the past year. However, they trade at 14.4 times forecast earnings, below a European sector average of 16.3 times, according to Reuters Estimates

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