Strong Roche says no to mergers
pharmafile | February 5, 2004 | News story | |Â Â Â
Roche is set for a strong return to growth in 2004 and says it should be counted out of growing speculation about mergers.
The company has released full year results which showed it has bounced back from several troubled years with a 23% growth in sales in 2003 thanks to double-digit growth from a number of its leading products including MabThera/Rituxan, Pegasys and Tamiflu.
In 2002, the company recorded a loss of CHF4 billion due to one-off charges relating to its vitamins business, now sold off, but this year it saw revenue hit CHF 3.1 billion.
Pharmaceuticals accounted for around 75% of the company's products and saw market share gains in all major markets worldwide, boosted by the acquisition of Japanese pharmaceutical company Chungai.
Roche chief executive Franz Humer made it clear, however, that it was not looking for any major tie-ups in the wake of Sanofi-Synthelabo's hostile takeover bid for Aventis. Novartis now hold a large minority holding in Roche, but seem certain to be blocked by its key private shareholders now seeing a resurgence in the company fortunes.
"I do not see any need for us, from a position of strength, to participate in industry consolidation," said Mr Humer.
"We will not participate in the Sanofi/Novartis/Aventis, or whoever else, consolidation game. We will sit like spectators in the box on the sidelines and watch the football game."
The company's prediction of a 22% growth in its profit margin in 2005 and an above average growth in its drugs and diagnostics division in 2004 is backed by analysts, including some who say its predictions are conservative.
Fuelling the new enthusiasm is the strength of the company's pipeline, which includes late-stage products such as colorectal cancer drug Avastin, due to be launched in the US later this year, while trial results are expected from lung cancer drug Tarceva in early 2004.
After the anticipated approval of Avastin in March, the company's next big milestone will be its R&D day in May when it is expected to showcase 60 development projects in ten therapeutic areas.
Sales of Roche's top-selling drug, lymphoma treatment MabThera/Rituxan rose 34% in 2003 to CHF2.8 million ($2.14 billion). The product is expected to maintain strong growth this year, with an expanded indication expected this year potentially doubling the number of patients eligible for the drug.
The divestment of the less profitable vitamins and chemicals business helped provide a one-off boost to income in 2003 but has inspired a review of the company's OTC division.
Mr Humer says the management are keeping its options open on the division, and could expand its operations or find a buyer for it.
"I'm particularly interested in some of the ideas we've received from the financial world. We could act together as a consolidator and [we would] keep a 30, 40, or 50 % stake," he said.
Related articles
Roche records $2.8bn loss in 2002
Thursday , February 27, 2003
