LONDON -- I believe that pharmaceuticals play AstraZeneca (LSE:AZN) (NYSE:AZN) is at risk of a fresh share price collapse, as current levels do not reflect the mountain the company has to ascend to turn its revenues around. Societe Generale last week stuck a 2,650 pence price tag on the company's stock, an 18% discount to the two-and-a-half-year high above 3,235 pence punched recently.

In my opinion, the company remains highly susceptible to renewed negative re-ratings, with earnings in coming years ready to continue tumbling before its restructuring program kicks into gear and new product development ratchets up.

Earnings slump as patents expire
AstraZeneca announced in January that group turnover slumped 17% to almost $28 billion in 2012, in turn driving pre-tax profit a chunky 38% lower to $7.7 billion. The result was driven by the loss of exclusivity across a number of its key brands -- indeed, the firm noted that patent issues related to its Seroquel IR, Nexium, Atacand and Merrem medicines accounted for 85% of the revenue dip.

The company has faced severe criticism in recent times as it has failed to adequately boost its new product pipeline to compensate for such significant patent expiries. New chief executive Pascal Soriot has been entrusted with overseeing a massive restructuring of the group, which includes the establishment of new research bases across Europe and North America, designed to underpin long-term innovation.

Further revenues pain expected
In the meantime, however, City forecasters expect earnings per share to collapse further in 2013 following the heavy 12% decline recorded last year. A drop of 19%, to 345 pence, is expected before falling another 3% in 2014 to 334 pence.

The pharmaceuticals giant does at least offer projected dividend yields well ahead of the 3.5% FTSE 100 average, however, with yields of 5.8% and 5.9% expected this year and next, respectively. And these payouts are pretty well protected, with coverage of 1.9 times for these years just below the widely regarded safety marker of 2.

AstraZeneca carries a P/E ratio of 9.4 and 9.7 for 2013 and 2014 respectively, providing a massive discount to the forward multiple of 31.3 for the broader pharmaceuticals and biotechnology sector.

Although this could a solid base from which to accrue juicy gains, the prospect of rising earnings pressure could drive share prices lower in the medium term. I would also like to see further progress from its restructuring plan before selecting AstraZeneca for my own stocks portfolio.

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Fool contributor Royston Wild and The Motley Fool have no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.