AstraZeneca (NYSE:AZN) reported its fourth-quarter and full-year earnings this morning before the bell, and the news isn't good. Per the report, core EPS (adjusted basis) for the quarter came in at 10.5% below consensus at $0.76, representing a 28% drop from the same period a year ago. On the bright side, revenue was in-line with the Street's estimates at $6.683 billion for the three-month period. 

For the full-year, the British pharma giant reported a core EPS of $4.28, which missed consensus by 2% and represents an 8% decline year-over-year. Revenues for the twelve-month period also fell short of the Street's estimates by approximately $600 million at $26.1 billion. 

Perhaps the biggest downer, though, was that AstraZeneca reported a net loss, on a non-adjusted basis, of $0.25 per share for the quarter. Moreover, EPS on a non-adjusted basis fell by a staggering 52% for the full-year. 

Source: Wikimedia

Areas of concern
Nexium sales fell by 16%, on a non-adjusted basis, to $832 million in the fourth quarter, and by 6% for the full-year, reflecting the loss of exclusivity for the product. 

The company's megablockbuster cholesterol drug Crestor also saw sales slip during the quarter, dropping by 5% to $1.38 billion. According to management, this drop was due to a 4% decline in prescriptions for the three-month period relative to a year ago and the negative impact of the Branded Pharmaceutical Fee.  

AstraZeneca's blockbuster respiratory syncytial virus medicine, Synagis, also posted a marked sales decline in the fourth-quarter of 22%. Based on the earnings release, Synagis sales are falling as a result of new guidelines issued by the American Academy of Pediatrics, Committee on Infectious Disease, in mid-2014 that restrict the types of patients eligible for the medicine. 

On the oncology front, three of the company's four major products (Zoladex, Arimidex, and Casodex) reported sales declines in the fourth-quarter, as well as for the twelve-month period. Some of these declines stem from the loss of patent protection (Arimidex and Casodex), whereas others (Zoladex) appear to simply be losing market share to newer medicines.  

Source: AstraZeneca

Bright spots and silver linings
AstraZeneca did have some good news for investors. The heart attack medicine, Brilinta, for example, saw its sales skyrocket by 45% during the fourth-quarter, and by nearly 70% for the full-year. So if the drug can continue gaining market share at breakneck speed, it should reach blockbuster status in 2015. 

Diabetes drug sales also ripped higher by 139% in 2014, fueled by the strong launch of Farxiga/Forxiga and continued uptake for Bydureon.

Respiratory drug sales grew by 10% for the year, primarily due to Pulmicort's strong performance in emerging markets.

On the clinical side, AstraZeneca reminded investors that it is making excellent progress. Specifically, the company garnered six regulatory approvals in 2014 and has an eye-popping 118 clinical trials under way. Management thus hopes that its robust clinical pipeline can return the company to growth by 2017. 

Is AstraZeneca worth the risk right now?
Because Crestor is facing a series of challenges such as lawsuits over its safety profile, newer (and potentially more potent) cholesterol drugs progressing in clinical trials, and its own date with the patent cliff in 2016, AstraZeneca is expected to continue posting steep declines in its top and bottom-lines in the years ahead. Management has thus pegged a potential turnaround mainly on a deep dive into the field of immuno-oncology, which represents the bulk the company's clinical activities at this point.

Although management has repeatedly expressed their belief that its immuno-oncology platform can return the company to growth by 2017, it's important to remember that most of these experimental drugs are still in the early stages of their clinical program. As such, there's no guarantee that AstraZeneca can turn things around in the next 2 to 3 years. So it might be smart to wait until this drugmaker is able to develop its immuno-oncology platform a bit further before taking a position.