Roche Group posts strong sales growth in the third quarter
- Group sales rise 4% at CER1 to 33.7 billion Swiss francs (+7% in Swiss francs) in the first nine months
- Cancer medicines and clinical lab business drive Group performance
- Perjeta launch and compelling T-DM1 (trastuzumab emtansine) data strengthen HER2 franchise
- T-DM1 filed for approval in EU and US in August
- Full-year outlook confirmed
|As % of
|2012||2011||2012||2011||At CER1||In CHF||In USD|
* Asia–Pacific, CEMAI, Latin America, Canada, Others (CEMAI: Central and Eastern Europe, Middle East, Africa, Central Asia, Indian Subcontinent)
Commenting on the Group’s 2012 performance to date, Roche CEO Severin Schwan said: “With the strong growth in the third quarter we remain well on track to meet our full-year targets. Our pipeline has continued to deliver with 11 positive results out of 14 late-stage studies so far this year.” Schwan added: “Roche has strengthened in particular its HER2 franchise with the successful launch of the breast cancer medicine Perjeta in the US and Switzerland as well as the filing of antibody-drug conjugate T-DM1 in both the US and Europe.”
Growth momentum continues
Roche sales grew 4%2 to 33.7 billion Swiss francs thanks to strong demand for its cancer medicines and its clinical lab business. Uptake of the Group’s recently launched cancer medicines Zelboraf, Erivedge and Perjeta has been positive. The Diagnostics Division maintained its global market leadership due to strong sales to hospital and private clinical laboratories (Professional, Molecular and Tissue Diagnostics businesses).
Group sales were strong in the US and in emerging markets, whereasin Western Europe sales growth declined slightly as expected. The weakening of the Swiss franc against the dollar and the Japanese yen, particularly in the third quarter, supported the sales performance in Swiss franc terms.
Roche was ranked the most sustainable healthcare company globally in the Dow Jones Sustainability Index (DJSI) for the fourth year in a row in September, underscoring the Group’s commitment to responsible business practices and the creation of long-term value.
Pharmaceuticals Division – oncology leads growth
Sales in the Pharmaceuticals Division rose 4% to 26.2 billion Swiss francs mainly due to the oncology portfolio, which grew 9%. The division benefited from strong growth in the US (+6%), China (+26%) and Brazil (+13%).
The three top selling medicines in the first nine months of the year were MabThera/Rituxan, Herceptin and Avastin, which together accounted for 52% of divisional sales.
Sales of MabThera/Rituxan, a monoclonal antibody for hematological malignancies and rheumatoid arthritis, were boosted by physicians prescribing the medicine for the first-line maintenance treatment of follicular lymphoma, a type of non-Hodgkin’s lymphoma (NHL). This was a key driver of sales in the US, which were particularly strong. Increasing use in diffuse large B-cell lymphoma, an aggressive form of NHL, in China also lifted sales. MabThera/Rituxan sales rose 10% to 5 billion Swiss francs.
Sales of Herceptin, which is used to treat HER2-positive breast and stomach cancers, rose 12% to 4.4 billion Swiss francs. This was largely due to an improvement in the quality of HER2 testing in the US and Western Europe, as well as programmes to help improve access to the drug in emerging markets. Japanese and US sales were driven by continued uptake for stomach cancer.
Avastin, which is approved to treat a number of different cancers, performed strongly helped by its successful launch in ovarian cancer in Western Europe. Physicians are also increasingly treating colorectal and lung cancer with Avastin in the US, while its use in breast cancer continues to grow outside the US. Avastin sales rose 6% to 4.3 billion Swiss francs.
In September Roche received a positive recommendation from the Committee for Medicinal Products for Human Use (CHMP) for Avastin in women with recurrent, platinum-sensitive ovarian cancer, an important step towards expanding its use to fight ovarian cancer in Europe. In the US the FDA has granted priority review for the use of Avastin in metastatic colorectal cancer patients who have already been treated with Avastin plus chemotherapy (TML, treatment across multiple lines). A Priority Review designation is given to drugs that offer major advances in treatment, or provide a treatment where no adequate therapy exists.
Roche’s pipeline delivered positive results in 11 out of 14 late-stage studies so far this year, further highlighting the Group’s potential for future growth. The tables on pages 11 and 12 of this release give an overview of Pharmaceuticals clinical and regulatory newsflow and Diagnostics’ key launches.
Solid HER2 franchise paves way for future growth
Roche further strengthened its HER2 franchise in the first nine months of the year with the successful launch of Perjeta in the US and Switzerland as well as the filing of marketing applications for antibody-drug conjugate T-DM1 in both the US and Europe.
Roche is building on the long-term success of Herceptin as the standard of care for women with HER2-positive breast cancer with two innovative products: Perjeta and T-DM1. These two medicines have the potential to offer the thousands of women affected by this type of breast cancer each year an even more effective and better tolerated treatment.
An updated overall survival analysis of the EMILIA trial presented at this year’s European Society for Medical Oncology congress showed that T-DM1 significantly extended the lives of patients with HER2-positive metastatic breast cancer compared with patients who were given combined lapatinib and Xeloda.
Diagnostics Division – strong business with clinical
Sales in the Diagnostics Division rose 4% to 7.5 billion Swiss francs. Growth was again driven by the business with clinical laboratories, especially Professional Diagnostics (+9%) and Tissue Diagnostics (+15%), which each grew at roughly twice their respective global market rates, as well as Molecular Diagnostics (+4%). Professional Diagnostics’ immunoassays (+15%) remained the division’s key growth driving product line.
This more than offset a decline in the Diabetes Care and Applied Science businesses (both -5%), which are facing challenging market environments. Diabetes Care is affected by further reimbursement cuts and intensified pressure on prices. Both businesses are in the process of restructuring to secure long-term profitability and drive future growth. Diabetes Care’s two recently launched blood glucose meters (Accu-Chek Nano SmartView and Accu-Chek Mobile) are showing promising uptake.
In emerging markets Roche Diagnostics continued to expand its presence, reflected by strong growth in Asia–Pacific (+16%, particularly China with +30%), and in Latin America (+14%).
Full-year targets confirmed
Roche confirms its full-year outlook for 2012. Barring unforeseen events, Roche expects low to mid-single-digit sales growth at constant exchange rates for the Group and the Pharmaceuticals Division in 2012. Sales by the Diagnostics Division are expected to again outpace the market. Despite a challenging market environment, based on the expected sales growth and continued efficiency improvements, Roche is aiming for a high single-digit increase in Core Earnings per Share at constant exchange rates. Roche will continue its attractive dividend policy.
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1) At constant exchange rates (CER)
2) Unless otherwise stated, all growth rates are at constant exchange rates (CER). The percentage changes at CER are calculated using simulations by reconsolidating both the 2012 and 2011 results at constant currencies (the average rates for the year ended 31 December 2011).
Disclaimer: Cautionary statement regarding forward-looking
This document contains certain forward-looking statements. These forward-looking statements may be identified by words such as ‘believes’, ‘expects’, ‘anticipates’, ‘projects’, ‘intends’, ‘should’, ‘seeks’, ‘estimates’, ‘future’ or similar expressions or by discussion of, among other things, strategy, goals, plans or intentions. Various factors may cause actual results to differ materially in the future from those reflected in forward-looking statements contained in this document, among others: (1) pricing and product initiatives of competitors; (2) legislative and regulatory developments and economic conditions; (3) delay or inability in obtaining regulatory approvals or bringing products to market; (4) fluctuations in currency exchange rates and general financial market conditions; (5) uncertainties in the discovery, development or marketing of new products or new uses of existing products, including without limitation negative results of clinical trials or research projects, unexpected side effects of pipeline or marketed products; (6) increased government pricing pressures; (7) interruptions in production; (8) loss of or inability to obtain adequate protection for intellectual property rights; (9) litigation; (10) loss of key executives or other employees; and (11) adverse publicity and news coverage. The statement regarding earnings per share growth is not a profit forecast and should not be interpreted to mean that Roche’s earnings or earnings per share for any current or future period will necessarily match or exceed the historical published earnings or earnings per share of Roche.
Posted: October 2012