Atikinson said there was no single factor behind the first-half revenue jump. There had been growth across the board among various products and territories. But in dollar terms, the biggest gains were made in Australia, where revenue increased 31% to $65m.
Research and development costs were $9.5m against the year-ago $8.9m.
Net debt was $20.9m at September 30 from the year-ago $18.9m. Hartley said there were no plans or need to raise capital.
The trade war factor
Like other pharmaceutical players in the international market, Hartley has kept a sharp eye on trade war developments.
US President Donald Trump has taken a number of stances on pharmaceutical imports over the year.
On February 18, Trump said there would be tariffs “of at least 25% on pharmaceuticals”, without giving a timeframe.
On April 2 (the big “Liberation Day” announcement in the US), Trump said pharmaceuticals would be one of a handful of products exempt from tariffs.
Just days later, at an April 8 Republican Party fundraising dinner, Trump reversed course again, saying there would be “a major tariff on pharmaceuticals” to encourage firms to manufacture in the US.
On September 25, Trump said on social media there would be 100% tariffs on patented drugs entering the US from October 1, “unless a Company IS BUILDING their Pharmaceutical Manufacturing Plant in America”.
On October 1, the President did not impose 100% tariffs, citing progress made in negotiations with big pharmaceutical firms. The process needed to “play out”. It is still playing out today, with no new deadline set.
Atkinson said AFT used contract manufacturers in a number of markets, including the US.
Assuming Trump did at some point impose a stiff tariff on non-locals, Hartley was confident AFT would avoid it by dint of being regarded as a local manufacturer via its partnership with its contract manufacturer.
A small market now, but one with biggest potential
Atkinson says the US market accounted for only about 2% of revenue in the first half, which also included sales from New Zealand, Australia (AFT’s largest market), Asia and Europe.
But it’s also the world’s largest market for pharmaceuticals and a key component of AFT’s growth plans.
So far, AFT has had two patented drugs approved for sale in the US – both variants of its Maxigensic painkiller, marketed as Combogesic. “It has big upside,” Atkinson said.
Elements of Trump’s domestic plan appeal
Trump’s shifting policies have been a challenge for the pharmaceutical industry’s planning. “It’s a complex landscape,” Atkinson said.
He also saw potential benefits from a shake-up.
While many US consumers put high drug prices squarely at the feet of pharmaceutical companies, companies called Pharmacy Benefit Managers (PBMs) – the unavoidable middlemen between drug companies and pharmacies, health insurers and big employers in the current set-up – bagged billions in profits, he said.
Trump has established TrumpRX, a website for US consumers to buy directly from drug companies, with Pfizer an early sign-up.
“It’s quite attractive to be able to sell drugs not through PBMs,” Atkinson told the Herald. “It’s actually something we think is very positive.”
Trump announced TrumpRX in early September. Last month, he said it would allow consumers to buy the weight-loss drug Ozempic for as little as US$350 ($625) per month. It currently costs up to US$1350 per month. It won’t sell drugs, but the President says it will let consumers find the cheapest prices and play a role in “cutting out costly third-party mark-ups”.
So far, the TrumpRX website features little beyond a giant picture of the President. The search for pharmaceuticals bar has a “Coming Soon” message, with a January 2026 launch promised.
Atkinson says the Cost Plus Drug Company, recently founded by Democrat-aligned billionaire Mark Cuban, also has potential as a replacement for PBMs.
The AFT managing director added that his firm was already paying tariffs on its various over-the-counter products, which include vitamin supplements, eye drops and hand sanitiser, yet had still achieved improved growth in the first half.
It was the 10th consecutive first-half revenue increase, Hartley said.
With today’s rise, AFT is now up 33% for the year for a market cap of $357m.
Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.
