Roche 3Q Sales Up 14 percent, Raises Outlook
Thu, 10/15/2009 - 4:26am
FRANK JORDANS Associated Press Writer GENEVA (AP) — Roche Holding AG said Thursday its third-quarter sales rose 14 percent to 12.4 billion Swiss francs ($12.24 billion) from 11.3 billion francs the previous year, driven by strong growth in cancer and flu drugs. The results, which beat most analyst predictions, prompted the Swiss drugmaker to raise its full-year outlook. Roche said it now expects at least high single-digit sales growth for its pharmaceuticals division in 2009 while its diagnostics division, too, is "expected to grow well ahead of market" this year. The company reports full earnings only every six months and won't have profit figures until year-end. Roche Chief Executive Severin Schwan said the integration U.S. biotech firm Genentech was progressing well. Roche completed its $46.8 billion takeover of Genentech in March after a protracted battle to win over Genentech shareholders, many of whom had expressed concern about a clash of corporate cultures between the Swiss and California-based companies. "By 2011 the group aims to achieve pre-tax annual synergies of approximately 1 billion Swiss francs" from the purchase of Genentech, Roche said. The company said it repaid over 7 billion francs of debt in the third quarter and expected to repay a further 5 billion francs by mid-2010, returning to a net cash position by 2015. Sales of cancer drug Avastin — to treat advanced colorectal, breast, lung and kidney cancer, as well as relapsed glioblastoma, a type of brain tumor — grew 21 percent and reached 1.59 billion francs, the Basel-based company said. Two other cancer drugs, Rituxan — known as MabThera in Europe — and Herceptin, also broke through the billion-franc sales barrier, grossing 1.51 billion francs and 1.33 billion francs respectively. Tamiflu sales increased more than nine-fold to 994 million francs, and full-year sales are expected to reach 2.7 billion francs, Roche said. Demand for the drug shot up earlier this year when the World Health Organization declared a swine flu pandemic and said Tamiflu was one of two anti-viral medicines effective against the H1N1 strain. The other is Relenza, produced by GlaxoSmithKline. Roche said it expects to sell Tamiflu worth about 700 million francs next year, but noted that this "will depend on levels of infection due to the pandemic A (H1N1) virus and seasonal influenza strains in the coming northern hemisphere winter, as well as government orders in the fourth quarter." Swine flu has killed at least 4,500 people worldwide since April, though in most cases symptoms are mild and patients recover without the need for treatment. Analyst Manfred Hofer at LGT Capital Management said most figures were "slightly above consensus" expectations. The positives were the solid performance of all key products and the strength of Tamiflu sales despite new vaccines for swine flu, he said. Roche shares were down 2.4 percent at 165.50 francs on the Zurich exchange.