Roche benefits from Tamiflu sales as Q3 shines
By
Sam Cage
ZURICH (Reuters) - Roche's (
ROG.VX) third-quarter sales rose 10 percent to 12.4 billion Swiss francs ($12.2 billion), helped by its cancer drugs and increased demand for flu medicine Tamiflu due to the H1N1 pandemic.
Sales of Tamiflu outstripped expectations and Roche, which has sealed a $47 billion buyout of U.S. partner Genentech, on Thursday raised its full-year forecast for the drug's sales to 2.7 billion francs.
Roche also nudged up its full-year forecast for its drugs unit, now seeing at least high single-digit sales growth, and confirmed its earnings target.
"Based on the good results for the third quarter, we raised our outlook for the full year," Chief Executive Severin Schwan told reporters.
Hefty drug price increases and windfall sales from
H1N1 swine flu have helped Big Pharma to a more successful year than feared, though the sector still has long-term problems such as greater competition for its big-selling drugs and trades at a discount to the wider market.
Two diversified healthcare groups have already demonstrated the sector's mixed prospects this week -- Abbott Laboratories' (
ABT.N) profit beat forecasts thanks to its Humira arthritis drug, while sales at rival Johnson & Johnson (
JNJ.N) disappointed.
Roche stock was expected to open 1 percent higher, according to pre-market data from bank Clariden Leu.
"Both the pharma and the diagnostics units grew faster than the overall market," analysts at Liechtenstein bank LGT said in a note.
Roche has been trading at a premium to European rivals GlaxoSmithKline (
GSK.L), Sanofi-Aventis (
SASY.PA), Novartis (
NOVN.VX) and AstraZeneca (
AZN.L) thanks to its strong position in cancer and biotech drugs and lack of exposure to generic competition.
Sales of Tamiflu, which Roche manufactures under license from Gilead Sciences (
GILD.O), more than quadrupled to 2 billion francs in the first nine months. Blockbuster cancer drug Avastin also underpinned growth, with nine-month sales up 26 percent.
Roche continues to pay down the debt from its Genentech buyout, repaying 7 billion francs in the third quarter and committing to more than another 5 billion by mid-2010, and is still screening the market for small and mid-sized buys, Schwan said.
Group sales for the third quarter rose 14 percent when the effect of currency movements was stripped out. It had been expected to post third-quarter sales of 12.2 billion francs, according to a Reuters poll.
It had previously expected full-year pharmaceuticals sales to grow in the high single-digit range this year and 2009 sales of Tamiflu to hit 2 billion francs.
($1=1.017 Swiss francs)
(Editing by Greg Mahlich and Jon Loades-Carter)
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