Roche lifts forecast as bet outside cancer pays off

Bloomberg

Roche Holding AG’s bet on fields outside its mainstay market of cancer is starting to pay off as the Swiss drugmaker boosted its forecast for this year. New medicines such as Ocrevus for multiple sclerosis and Hemlibra for hemophilia are driving the increase, the company said in a statement. The world’s biggest maker of cancer treatments also reported sales that exceeded analysts’ estimates in the first quarter.
Roche is working to replace sales lost as its three biggest drugs — all medicines for cancer — face competition from cheaper copies known as biosimilars. With the $450,000-a-year hemophilia drug Hemlibra, the Swiss drugmaker is facing off against market leader Shire Plc, which is close to an agreement to be acquired by Takeda Pharmaceutical Co.
“Clearly we are very well positioned,” looking across the entire
portfolio of new and experimental medicines, Chief Executive Officer Severin Schwan said on a conference call. “I am very confident that we can grow in spite of the entry of biosimilars.”
Sales will probably rise by a low single-digit percentage at constant exchange rates this year, Roche said.
It previously said they might show little change. Core earnings per share will grow roughly in line with sales, according to the Basel, Switzerland-based company.
Sales of Roche’s former best-selling drug Rituxan fell more than expected in Europe due to competition from biosimilars, Morgan Stanley analysts wrote in a report.
Revenue from the drug dropped 8 percent to 1.7 billion francs, with sales in Europe plunging 44 percent.
Roche’s overall revenue rose 6 percent at constant exchange rates to 13.6 billion francs last quarter, beating the estimate of analysts surveyed by Bloomberg. Breast cancer medicine Perjeta, Roche’s follow-on for
its best-selling drug Herceptin, also contributed to sales growth.
Hemlibra, which went on sale in November, garnered sales of 23 million francs. It needed first-quarter sales of about $10 million to $20 million to meet expectations, and revenue will probably tick upward in the second half, when the drug is expected to win approval for a broa-der group of patients, said Eliza-
beth Krutoholow, an analyst with Bloomberg Intelligence.
Hemlibra’s wholesale price — which starts at $482,000 for the first year of treatment before dropping to about $448,000 a year for an average patient after that — is less than half that of its main rival, according to Roche. Analysts expect the drug to reach about $2 billion in sales by 2021.
The Roche compound’s initial approval was for people with a particularly hard-to-treat type of hemophilia A, a disorder in which patients lack a crucial protein called factor VIII that helps blood clot. Hemlibra mimics the action of factor VIII to stop bleeding.