Risk
category and Principal Risks
|
Context/potential
impact
|
Management
actions
|
Product pipeline and intellectual property
|
||
Failure
or delay in the delivery of our pipeline or launch of new
medicines
|
The
development of any pharmaceutical product candidate is a complex,
risky and lengthy process involving significant financial, R&D
and other resources. A project may fail or be delayed at any stage
of the process due to a number of factors, which could reduce our
long-term growth, revenue and profit.
|
> Prioritise
and accelerate our pipeline. Strengthen pipeline through
acquisitions, licensing and collaborations.
> Focus
on innovative science in three main therapy areas.
|
Failure
to meet regulatory or ethical requirements for medicine development
or approval
|
Our
pharmaceutical products and commercialisation processes are subject
to extensive regulation. Delays in regulatory reviews and approvals
impact patients and market access, and can materially affect our
business or financial results.
|
> Quality
management systems incorporating monitoring, training and assurance
activities.
> Collaborating
with regulatory bodies and advocacy groups to monitor and respond
to changes in the regulatory environment, including revised
process, timelines and guidance.
|
Failure
to obtain, defend and enforce effective IP protection or IP
challenges by third parties
|
Discovering
and developing medicines requires a significant investment of
resources. For this to be a viable investment, new medicines must
be safeguarded from being copied for a reasonable amount of time.
If we are not successful in obtaining, maintaining, defending or
enforcing our IP rights, and face competition from generic or
biosimilar products, our revenues could be materially adversely
affected.
Third
parties may allege infringement of their IP, and may seek
injunctions and/or damages, which, if ultimately awarded, could
adversely impact our commercial and financial
performance.
|
> Active
management of IP rights and IP litigation.
|
Commercialisation
|
||
Pricing,
affordability, access and competitive pressures
|
Operating
in more than 100 countries, we are subject to political,
socioeconomic and financial factors, both globally and in
individual countries. There can be additional pressure from
governments and other healthcare payers on medicine prices and
sales in response to recessionary pressures, which may lead to a
reduction in our revenue, profits and cash flow.
|
> Focus
on sales platforms.
> Demonstrating
value of medicines/ health economics.
> Global
footprint.
> Diversified
portfolio.
|
Failure
or delays in the quality or execution of the Group's commercial
strategies
|
If
commercialisation of a product does not succeed as anticipated, or
its rate of sales growth is slower than anticipated, there is a
risk that we may not be able to fully recoup related launch
costs.
|
> Focus
on sales platforms.
> Accelerate
execution of plans and risk share through business development and
strategic collaborations and alliances.
|
Supply chain and business execution
|
||
Failure
to maintain supply of compliant, quality medicines
|
Delays
or interruptions in supply can lead to recalls, product shortages,
regulatory action, reputational harm and lost sales
revenue.
|
> Establishment
of new manufacturing facilities, creating capacity and technical
capability to support new product launches.
> Contingency
plans including dual sourcing, multiple suppliers, and close
monitoring and maintenance of stock levels.
> Business
continuity and resilience initiatives, disaster and data recovery
and emergency response plans.
> Quality
management systems.
|
Failure
in information technology or cybersecurity
|
Significant
disruption to our IT systems or cybersecurity incidents, including
breaches of data security, could harm our reputation and materially
affect our financial condition or results of operations. This could
lead to regulatory penalties or non-compliance with laws and
regulations.
|
> Cybersecurity
framework and dashboard.
> Disaster
and data recovery plans.
> Strategies
to secure critical systems and processes.
> Regular
cybersecurity and privacy training for employees.
|
Failure
to attract, develop, engage and retain a diverse, talented and
capable workforce
|
Failure
to attract and retain highly-skilled personnel may weaken our
succession plans for critical positions in the medium term.
Employee uncertainty as a result of, for example, Brexit or
organisational change may result in a lower level of employee
engagement which could impact productivity and turnover. Both could
adversely affect the achievement of our strategic
objectives.
|
> Targeted
recruitment and retention strategies deployed.
> Identification
and active support of staff potentially impacted by
Brexit.
> Development
of our employees.
> Evolve
our culture.
|
Legal, regulatory and compliance
|
||
Safety
and efficacy of marketed medicines is questioned
|
Patient
safety is very important to us and we strive to minimise the risks
and maximise the benefits of our medicines. Failure to do this
could adversely impact our reputation, our business and the results
of operations, and could lead to product liability
claims.
|
> Robust
processes and systems in place to manage patient safety and
efficacy trends as well as externally reported risks through
regulatory agencies and other parties. This includes a
comprehensive pharmacovigilance programme supplemented by close
monitoring and review of adverse events.
|
Adverse
outcome of litigation and/or governmental
investigations
|
Investigations
or legal proceedings could be costly, divert management attention
and/or damage our reputation and demand for our products.
Unfavourable resolutions could subject us to criminal liability,
fines, penalties or other monetary or non-monetary remedies,
adversely affecting our financial results.
|
> Combined
internal and external counsel management.
|
Failure
to meet regulatory and ethical expectations on commercial
practices, including anti-bribery and anti-corruption, and
scientific exchanges
|
Any
failure to comply with applicable laws, rules and regulations,
including anti-bribery and anti-corruption legislation, may result
in civil and/or criminal legal proceedings and/or regulatory
sanctions, fines or penalties, impacting financial
results.
|
> Strong
ethical and compliance culture.
> Established
compliance framework including annual Code of Ethics training for
all employees.
> Focus
on due diligence and oversight of third-party
engagements.
|
Economic and financial
|
||
Failure
to achieve strategic plans or meet targets or
expectations
|
Failure
to implement successfully our business strategy may frustrate the
achievement of our financial or other targets or expectations. This
failure could, in turn, damage our reputation and materially affect
our business, financial position or results of
operations.
|
> Focus
on sales platforms and innovative science in three main therapy
areas.
> Strengthen
pipeline through acquisitions, licensing and
collaborations.
> Appropriate
capital structure and balance sheet.
> Portfolio-driven
decision making process governed by senior executive-led
committees.
|
|
AstraZeneca
PLC
|
|
By: /s/
Adrian Kemp
|
|
Name:
Adrian Kemp
|
|
Title:
Company Secretary
|