Roche reports strong results in 2015
Basel, 28 January 2016
- Group sales increased by 5%1 at constant exchange rates, 1% in Swiss francs
- Pharmaceuticals Division sales up 5%, driven by oncology medicines Herceptin, Avastin and Perjeta as well as Esbriet for idiopathic pulmonary fibrosis
- Diagnostics Division sales grew by 6%, driven primarily by immunodiagnostic products
- Major pipeline progress: ocrelizumab with positive phase III data for relapsing and for primary progressive forms of multiple sclerosis; and promising results for atezolizumab in bladder and lung cancer
- Fully automated cobas 6800 and cobas 8800 systems launched in the US in Molecular Diagnostics
- Core earnings per share2 up 7% at constant exchange rates excluding the sale of filgrastim rights in 2014, -3% in Swiss francs
- Board proposes dividend increase to CHF 8.10
- Outlook for 2016: sales expected to grow low- to mid-single digit, at constant exchange rates. Core earnings per share targeted to grow ahead of sales at constant exchange rates. Roche expects to further increase its dividend in Swiss francs
|CHF millions||% change|
|Core operating profit|
|Core EPS - diluted (CHF)|
|IFRS net income||9,056||9,535||+4||-5|
Commenting on the Group’s results, Roche CEO Severin Schwan said: “2015 was a successful year, with strong business results in both Pharmaceuticals and Diagnostics, driven by our newly launched medicines and diagnostic platforms. I am particularly pleased with the progress of our product pipeline. We reported important clinical data across several areas including cancer, multiple sclerosis, immune and blood diseases. Based on our strong product portfolio and promising pipeline, we are well positioned for the future.”
Strong sales growth in both Divisions
In 2015, Group sales increased by 5% to CHF 48.1 billion, driven primarily by pharmaceutical sales in the US and by strong demand for immunodiagnostic products.
In the Pharmaceuticals Division, sales rose 5% to CHF 37.3 billion. The increase was driven by the oncology portfolio (+8%), led by the HER2 medicines and Avastin. Sales of the immunology franchise grew by 24%, driven by the strong uptake of Esbriet, a new medicine for idiopathic pulmonary fibrosis, as well as higher sales of Actemra/RoActemra and Xolair. Sales of Pegasys declined due to competition from a new generation of treatments, while Valcyte/Cymevene and Xeloda faced generic competition as expected.
All regions contributed to the sales growth, with particularly strong performance in the US (+6%) and in Europe (+4%), which was driven by strong demand for the HER2 medicines along with strong uptake of Esbriet. Growth in the International region3 (+5%) was driven by key markets including Brazil (+10%) and China (+4%). In Japan, sales grew by 6%, driven by Avastin, the HER2 franchise and the new lung cancer medicine Alecensa.
In Diagnostics, sales grew 6% to CHF 10.8 billion, with Asia-Pacific (+15%) and Europe, Middle East and Africa (EMEA, +4%) as the main contributors. Sales were up in Latin America (+11%) and in North America (+3%), whilst sales in Japan were stable. The major growth driver was Professional Diagnostics, which grew by 8%. Sales in Molecular Diagnostics and Tissue Diagnostics increased 10% and 12% respectively. Diabetes Care sales decreased 3% due to continuing challenging market conditions, especially in the US.
Profitability growth ahead of sales
Excluding a one-time income of CHF 428 million from the sale of filgrastim rights in 2014, core operating profit increased 7% at constant exchange rates. On the same basis, core earnings per share (CHF 13.49) were 7% higher.
IFRS net income increased 4% at constant exchange rates, but declined 5% in Swiss franc terms due to a major negative currency impact.
The Board of Directors has recommended a dividend increase to CHF 8.10 per share and non-voting equity security. Subject to approval by the Annual General Meeting of shareholders on 1 March 2016, this will be Roche’s 29th consecutive annual dividend increase.
Product approvals and portfolio progress
Roche made significant progress with launches of new medicines and diagnostics as well as its product pipeline. In 2015, Roche obtained five major approvals and four FDA breakthrough therapy designations on its medicines.
In the past year, Roche presented important results from a number of key clinical trials. For ocrelizumab, Roche announced positive phase III data in relapsing forms of MS and in primary progressive MS (PPMS). Ocrelizumab is the first medicine to show a clinically meaningful impact on the progression of disability in people with PPMS in a pivotal phase III trial. Roche will submit the data in relapsing forms of MS and PPMS to global health authorities in 2016.
In January 2016, Roche completed the US filing for its lead investigational cancer immunotherapy medicine atezolizumab in metastatic bladder cancer and expects to complete a second filing in metastatic lung cancer soon. Late in 2015, Roche received approvals in the US and EU for Cotellic in combination with Zelboraf to treat metastatic melanoma. In December, the US FDA granted accelerated approval for Roche’s cancer medicine Alecensa in a specific form of non-small cell lung cancer.
In Diagnostics, Roche further extended its industry-leading product portfolio with seven test and eight instrument launches, including new cobas 6800 and cobas 8800 systems in Molecular Diagnostics and the Ventana HE 600 system in Tissue Diagnostics.
Strategic partnerships to improve patient care
In January 2016, Roche announced a partnership with Flatiron Health, an industry leader in real-world oncology data. Building on the collaboration with Foundation Medicine, begun in 2015, this agreement is another important milestone to drive our leadership in personalised healthcare. High-quality healthcare data and advanced analytics will improve both the development of medicines and the quality of treatment decisions. In 2015, Roche also acquired Ariosa Diagnostics, Signature Diagnostics, CAPP Medical and Kapa Biosystems, companies with strong expertise and technologies which will complement Roche’s activities aimed at building a next-generation sequencing portfolio.
Outlook for 2016
In 2016, Roche expects sales to grow low- to mid-single digit, at constant exchange rates. Core earnings per share are targeted to grow ahead of sales at constant exchange rates. Roche expects to further increase its dividend in Swiss francs.
Roche is a global pioneer in pharmaceuticals and diagnostics focused on advancing science to improve people’s lives.
Roche is the world’s largest biotech company, with truly differentiated medicines in oncology, immunology, infectious diseases, ophthalmology and diseases of the central nervous system. Roche is also the world leader in in vitro diagnostics and tissue-based cancer diagnostics, and a frontrunner in diabetes management. The combined strengths of pharmaceuticals and diagnostics under one roof have made Roche the leader in personalised healthcare – a strategy that aims to fit the right treatment to each patient in the best way possible.
Founded in 1896, Roche continues to search for better ways to prevent, diagnose and treat diseases and make a sustainable contribution to society. Twenty-nine medicines developed by Roche are included in the World Health Organization Model Lists of Essential Medicines, among them life-saving antibiotics, antimalarials and cancer medicines. Roche has been recognised as the Group Leader in sustainability within the Pharmaceuticals, Biotechnology & Life Sciences Industry seven years in a row by the Dow Jones Sustainability Indices.
The Roche Group, headquartered in Basel, Switzerland, is active in over 100 countries and in 2015 employed more than 91,700 people worldwide. In 2015, Roche invested CHF 9.3 billion in R&D and posted sales of CHF 48.1 billion. Genentech, in the United States, is a wholly owned member of the Roche Group. Roche is the majority shareholder in Chugai Pharmaceutical, Japan. For more information, please visit www.roche.com.
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1) Unless otherwise stated, all growth rates in this document are at constant exchange rates (CER: average 2014).
2) Excluding the one-time benefit of CHF 428 million before tax related to the divestment of filgrastim rights in 2014.
3) Asia-Pacific, EEMEA (Eastern Europe, Middle East, Africa), Latin America, Canada, Others.
Disclaimer: Cautionary statement regarding forward-looking statements
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 2015 or any subsequent period will necessarily match or exceed the historical published earnings or earnings per share of Roche