By Denise Roland 

LONDON-- AstraZeneca PLC on Friday reported a fall in first-quarter revenue and profit as the company invests in new drugs, while sales of its older blockbusters are eroded by cheaper rivals.

The U.K.-based company said core net profit fell to $1.37 billion in the quarter ended March 31, 7% lower than a year earlier, or 3% at constant exchange rates.

Revenue from product sales fell to $5.75 billion--a drop of 10%, or 3% at constant exchange rates. Analysts surveyed by Dow Jones forecast core net profit of $1.37 billion and revenue of $5.68 billion. Total revenue, which for the first time included income from licensing deals, increased 1% to $6.06 billion at constant exchange rates.

But the company was eager to direct the focus onto its pipeline of new drugs, especially those in a hot research area known as immuno-oncology, which looks at strengthening the body's own immune defenses to fight cancer.

AstraZeneca reported two new licensing deals in this area, both aimed at broadening the applications of immuno-oncology drugs in its own pipeline.

It will pay French biotech Innate Pharma SA up to $1.28 billion to exclusively co-develop and commercialize a drug known as IP2201 as a combination therapy with its own drugs. It will also pay royalties on eventual sales.

Astra has also done a deal with Celgene Corporation, whereby Celgene will pay the U.K.-based drug maker $450 million to develop one of its immuno-oncology treatments in a range of blood cancers. The drug, known as MEDI4736, is being developed for lung and head and neck cancer by AstraZeneca.

Pascal Soriot, chief executive, described the results as "encouraging" and maintained full-year guidance of a mid-single digit percentage decline in revenue and a low-single digit increase in core earnings per share. He noted that the company's oncology research program was now running 72 trials, including 31 in immuno-oncology.

He also highlighted the strong performance of the company's so-called "growth platforms"--the products or regions it is betting on as the main sources of future revenue. These areas, spanning heart drug Brilinta, lung drugs, diabetes, cancer, emerging markets and Japan, accounted for 56% of total revenue.

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