Genentech integration hits Roche profits
pharmafile | February 3, 2010 | News story | Sales and Marketing | 2009 financials, Genentech, Roche
Roche achieved healthy sales growth in 2009 but saw a 22% drop in net income due to the cost gaining full control of Genentech and the company’s subsequent restructuring.
Net income fell to CHF 8.5 billion, but total sales were up 8% to CHF 49 billion, led by flu treatment Tamiflu.
Demand for the drug leapt 435% on the back of the swine flu pandemic, rising to CHF 2.6 billion, or 7% of Roche’s total 2009 sales.
Sales of the anti-viral treatment are expected to decrease dramatically in 2010 and if Tamiflu is removed from the figures Roche’s 2009 sales increased by a more modest 4%.
Elsewhere in its portfolio breast cancer treatment Herceptin (trastuzamab) increased 8% to CHF 3.2 billion and colorectal, breast and lung cancer drug Avastin (bevacizumab) rose 21% to CHF 6.2 billion.
Meanwhile, age-related macular degeneration treatment Lucentis (ranibizumab injection) rose 24% to CHF 12 billion.
Severin Schwan, chief executive of Roche, said: ““In a turbulent external environment Roche performed extraordinarily well. Sales by both Pharma and Diagnostics grew twice as fast as their respective markets.
“We have laid the foundation for future growth: Our pharma pipeline now comprises ten new molecular entities in late-stage development – which is remarkable by any standards in our industry.”
There were lossess for the company during 2009, the two biggest of which were CellCept and NeoRocormon.
Sales of transplant rejection drug CellCept (mycophenolate mofetil) were down 22% to CHF 1.6 billion and NeoRocormon (epotein beta), which treats anemia in patients with chronic renal failure (CRF) on dialysis, dropped 11% to CHF 1.6 billion.
CellCept’s fall was due to a steep generic competition in the US, while NeoRocormon’s drop in sales was due in large part to price pressures.
Genentech – integrating and restructuring
Speaking of the Genentech integration, Schwan said: “Bringing Genentech fully into the Roche Group is a major step on the road to creating a stronger, even more innovative organisation.”
After acquiring the outstanding shares in the US biotech in March Roche set about restructuring its combined US pharmaceutical business and a number of global functions.
The restructuring and integration costs ran to CHF 2.4 billion, mainly as a result of halting a construction project at its Vacaville, California manufacturing site, shuttering manufacturing operations at Nutley, New Jersey and R&D operations at Palo Alto, California, and consolidating US administrative functions in South San Francisco.
Looking ahead Roche expects mid-single digit growth in both pharma and group sales in 2010, and recently gained FDA approval for rheumatoid arthritis treatment Actemra (tocilizumab) and EMA approval for Herceptin in combination with chemotherapy for use in patients with HER2-positive metastatic gastric cancer.
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