Roche reports very strong growth in the first nine months of 2018

• Group sales increase 7% ^[1] at constant exchange rates and in Swiss francs
• Pharmaceuticals Division sales up 7%, driven mainly by Ocrevus, Perjeta, Alecensa and Tecentriq
• Diagnostics Division sales grow 6%, primarily due to demand for immunodiagnostic solutions
• Recent approvals: Hemlibra for people with haemophilia A without factor VIII inhibitors, Actemra sub-cutaneous formulation for active systemic juvenile idiopathic arthritis and prefilled syringes for Xolair in the US; Alecensa for a form of lung cancer in China
• Outlook for 2018 confirmed

         *Asia-Pacific, EEMEA (Eastern Europe, Middle East and Africa), Latin America, Canada, Others

Commenting on the Group's results, Roche CEO Severin Schwan said: "In the first nine months of the year, both our Pharmaceuticals and Diagnostics Divisions achieved very strong sales growth. The uptake of our new medicines continued to be strong in the third quarter. I am also very pleased that following the recent additional FDA approval, Hemlibra is now broadly available in the US for people with haemophilia A. Based on the performance in the first nine months of the year, we will achieve our full-year targets."


Group sales
Very strong sales growth in both divisions
In the first nine months of 2018, Group sales rose 7% to CHF 42.1 billion. Sales in the Pharmaceuticals Division increased 7% to CHF 32.7 billion. Key growth drivers were the recently launched medicine Ocrevus, used to treat two forms of multiple sclerosis, and cancer medicines Perjeta, Alecensa and Tecentriq. As expected, the strong growth reported for the Pharmaceuticals Division was partially offset by lower sales of MabThera/Rituxan and of Tarceva.

In the US, sales increased 14%, led by Ocrevus, Herceptin and Perjeta. Ocrevus sales were supported by continued strong new patient demand. The 30% sales increase of Perjeta was driven by its use for adjuvant (after surgery) treatment of patients with HER2-positive early breast cancer at high risk of recurrence. ^[2]

In Europe (-8%), strong launches of our new medicines Ocrevus, Tecentriq and Alecensa, especially in Germany, partially offset declining sales of MabThera/Rituxan (-48%) and Herceptin (-10%), which were impacted by biosimilar competition. Perjeta sales continued to grow, specifically in the metastatic and neoadjuvant settings. In the International region, sales grew 8%, led by the Asia-Pacific and Latin America subregions. In the Asia-Pacific region, growth was driven by sales in China. In Japan, sales were stable.

Diagnostics Division sales increased 6% to CHF 9.4 billion. Centralised and Point of Care Solutions (+7%) was the main contributor, led by the growth of its immunodiagnostics business (+10%). Sales increased in all business areas and all regions. Growth was driven by the Asia-Pacific (+13%) and North America (+6%) regions. Sales increased 2% in EMEA ^[3] 8% in Latin America and 3% in Japan.

Milestones for Roche medicines
In recent months, health authorities granted approvals for several Roche products. The US Food and Drug Administration (FDA) approved Hemlibra for routine prophylaxis to prevent or reduce the frequency of bleeding episodes in adults and children, aged newborn and older, with haemophilia A without factor VIII inhibitors.

Approval was granted by the FDA for single-dose prefilled syringes for Xolair as an additional formulation for both allergic asthma and chronic idiopathic urticaria (CIU) indications. Further, US approval was granted for the subcutaneous formulation of Actemra for the treatment of active systemic juvenile idiopathic arthritis in patients aged two and older.

The China National Drug Administration (CNDA) granted marketing authorisation for Alecensa as a monotherapy treatment for patients with anaplastic lymphoma kinase (ALK)-positive, advanced non-small cell lung cancer (NSCLC).

The European Committee for Medicinal Products for Human Use (CHMP) recommended the approval of the subcutaneous formulation of RoActemra for the treatment of active systemic juvenile idiopathic arthritis in patients aged one and older. The CHMP also recommended the approval of Venclyxto in combination with MabThera for the treatment of people with chronic lymphocytic leukaemia who have received at least one prior therapy.

The FDA granted Breakthrough Therapy Designation for Xolair for the prevention of severe allergic reactions following accidental exposure to one or more foods in people with allergies.

The European Medicines Agency (EMA) granted PRIME (PRIority MEdicines) designation for Roche's investigational medicine RG6042 (formerly known as IONIS-HTTRx) for the treatment of people with Huntington's disease (HD).

Clinical trial results on Roche medicines
Results from a number of late-stage studies were announced in recent months: results from the phase III Katherine study showed that treatment with Kadcyla as a single agent significantly reduced the risk of disease recurrence or death (invasive disease-free survival, iDFS) compared to Herceptin as an adjuvant (after surgery) treatment in people with HER2-positive early breast cancer (eBC) who have residual disease (pathological invasive residual disease in the breast and/or axillary nodes) present following neoadjuvant (before surgery) treatment.

Five-year data from the phase III open-label extension studies of Opera I, Opera II and Oratorio show that Ocrevus efficacy is maintained on key measures of disease activity and that people treated earlier with Ocrevus had superior disability progression outcomes compared with RMS patients who switched from interferon beta-1a or PPMS patients who switched from placebo.

Positive results from the phase III IMpower133 study of Tecentriq plus carboplatin and etoposide (chemotherapy) for the initial (first-line) treatment of people with previously untreated extensive-stage small cell lung cancer (ES-SCLC) showed that Tecentriq and chemotherapy helped people live significantly longer compared with chemotherapy alone in the intention-to-treat (ITT) population. The Tecentriq-based combination also significantly reduced the risk of disease worsening or death (progression-free survival, PFS) compared with chemotherapy alone.

An integrated analysis of the pivotal entrectinib phase II Startrk-2, phase I Startrk-1 and phase I Alka trials showed that entrectinib shrank tumours (objective response rate; ORR) in 77.4% of people with locally advanced or metastatic ROS1-positive non-small cell lung cancer (NSCLC). In addition, entrectinib demonstrated a durable response of more than two years (duration of response = 24.6 months).

The phase III Capstone-2 study showed treatment with baloxavir marboxil significantly reduced the time to improvement of influenza symptoms versus placebo (median time of 73.2 hours versus 102.3 hours) in people at high risk of serious complications from the flu, which includes adults aged 65 years and older, or those who have conditions such as asthma, chronic lung disease, morbid obesity, or heart disease. Baloxavir marboxil is the first potential influenza treatment in clinical trials to demonstrate a clinically meaningful benefit for people highly vulnerable to serious influenza complications.

Interim clinical data were announced from the dose-finding parts of the pivotal Firefish and Sunfish studies investigating risdiplam (RG7916) in SMA. In the Firefish study in type 1 SMA, six out of 14 infants (43%) were able to sit (with or without support), including three (21%) who achieved unassisted stable sitting after eight months of treatment. In addition, four infants (29%) demonstrated rolling to the side; seven (50%) kicking and six (43%) achieved upright head control. These milestones were assessed according to the Hammersmith Infant Neurological Examination Module 2 and are key secondary endpoints in the confirmatory part of Firefish.

Results from the phase III IMpower132 study of Tecentriq plus pemetrexed and platinum-based chemotherapy (cisplatin or carboplatin) for the initial (first-line) treatment of people with non-squamous NSCLC showed that Tecentriq and chemotherapy reduced the risk of disease worsening or death (progression-free survival, PFS) by 40% compared with chemotherapy. While a numerical improvement of 4.5 months for the co-primary endpoint of overall survival (OS) was observed, at this interim analysis statistical significance has not yet been met.

Roche announced the global availability of FoundationOne Liquid, a liquid biopsy test. FoundationOne Liquid can identify circulating tumour DNA in the blood of people living with cancer and can identify 70 of the most commonly mutated genes in solid tumours, including microsatellite instability, a genomic signature which may help inform cancer immunotherapy-based treatment decisions. From a single blood sample, the liquid biopsy offers a quick and convenient option for some patients with solid tumours.

Advancing personalised healthcare
Roche completed the transaction to take 100% ownership of Foundation Medicine (FMI), Inc., US, in late July 2018. A tender offer had been launched on 2 July 2018.  This transaction broadens Roche's personalised healthcare strategy and aims to further advance molecular insights and the broad availability of high-quality comprehensive genomic profiling, both key enablers for the development of new cancer treatments and optimal patient care.

Diagnostics - tools for decision support
As part of its public-private partnership with the Kenya Medical Research Institute (KEMRI), Roche installed a cobas 8800 System for state-of-the-art diagnostic testing, including HIV diagnosis, in Nairobi, Kenya. This laboratory will support local efforts in the fight against HIV/AIDS.

The cobas MTB and cobas MAI tests for use on the cobas 6800/8800 Systems have become available in countries accepting the CE Mark.

The first two Navify clinical decision support apps were launched, expanding the Navify eco-system; the Navify Clinical Trial Match and Navify Publication Search apps help oncology care teams access relevant clinical trial information and publications more effectively.

Three new next-generation sequencing (NGS) Avenio Tumor Tissue Analysis Kits (research use only) were made available globally: the Avenio Tumor Tissue Targeted Kit, Expanded Kit and Surveillance Kit. The kits, which detect all four mutation classes in solid tumours, complement Roche's NGS ctDNA kits for oncology research.

Outlook confirmed for 2018
Roche expects sales to grow mid-single digit, at constant exchange rates. Core earnings per share are targeted to grow in the mid-teen digits, at constant exchange rates. Excluding the US tax reform impact, core earnings per share are targeted to grow broadly in line with sales. Roche expects to further increase its dividend in Swiss francs.


Pharmaceuticals Division

         * Asia-Pacific, EEMEA (Eastern Europe, Middle East and Africa), Latin America, Canada, Others; ** over 500%


Key pharmaceutical products in 2018


HER2-franchise (Herceptin, Perjeta and Kadcyla, +7%). For HER2-positive breast cancer and HER2-positive metastatic gastric cancer (Herceptin only).

Herceptin (+2%). For HER2-positive breast cancer and HER2-positive metastatic gastric cancer. Sales increases were mainly driven by growth in the US and in China, partially offset by the sales decline in Europe.

MabThera/Rituxan (-9%). For forms of blood cancer, rheumatoid arthritis and certain types of vasculitis. Sales development was impacted by Europe (-48%) as a result of the market entry of biosimilars. In the US, sales increased 4%, with growth in both the immunology and oncology segments, also driven by the subcutaneous formulation. Sales were also higher in the International region (+11%), particularly in China due to broader market penetration.

Avastin (+2%). For advanced colorectal, breast, lung, kidney, cervical and ovarian cancer, and relapsed glioblastoma (a type of brain tumour). Sales increased in the International region and in Japan (+10% and +3% respectively) but were flat in the US and declined in Europe (-2%).

Actemra/RoActemra (+12%). For rheumatoid arthritis, forms of juvenile idiopathic arthritis and giant cell arteritis as well as CAR T cell-induced severe or life-threatening cytokine release syndrome. Sales growth was reported in all regions, driven by the continued uptake of the subcutaneous formulation.

Xolair (+10%, US only). For chronic idiopathic urticaria and allergic asthma. Growth was driven by demand in both indications.

Lucentis (+11%, US only). For eye conditions including neovascular ('wet') age-related macular degeneration, macular oedema following retinal vein occlusion, diabetic macular oedema, and diabetic retinopathy. Growth was driven by the launch of prefilled syringes and sales increases in all approved indications.

Highlights on certain medicines launched since 2012

Perjeta. For HER2-positive breast cancer. Sales (CHF 2.0 billion, +24%) grew in all regions. As at October 2018, Perjeta was registered in 60 countries for adjuvant treatment. This indication strongly supports its continued growth, which is also driven by increased demand in the neoadjuvant and metastatic settings across the regions.

Ocrevus (CHF 1.7 billion, +238%). For both the relapsing and primary progressive forms of multiple sclerosis (MS). Ocrevus has now been approved in almost 70 countries, with 70,000 people treated globally as at October 2018. Strong demand in both indications has continued. Reflecting the high medical need, two phase IIIb studies in progressive MS have been announced, to include endpoints never used in previous trials and which will enroll over 1,000 people across more than 25 countries.

Tecentriq (CHF 524 million, +49%). For advanced bladder cancer and advanced lung cancer. Sales growth was driven by post-launch uptake in Europe, notably in Germany. Roche is conducting a large number of studies of Tecentriq in combination with medicines from Roche's marketed and investigational portfolios as well as those developed with our external partners.

Alecensa (CHF 437 million, +79%). For a specific form of lung cancer. Alecensa showed continued strong sales growth across all regions.

Gazyva/Gazyvaro (CHF 281 million, +39%). For chronic lymphocytic leukaemia (CLL), rituximab-refractory follicular lymphoma and previously untreated advanced follicular lymphoma. Sales expanded, especially in Europe and in the US.

Hemlibra (CHF 113 million). For people with haemophilia A with inhibitors to factor VIII. Hemlibra is approved in more than 40 countries, including the US, the EU, Australia and Japan. In the US, Hemlibra is also approved for people with haemophilia A without factor VIII inhibitors and is the only prophylactic treatment that can be administered subcutaneously and at multiple dosing options (once weekly, every two weeks or every four weeks).


Diagnostics Division

Centralised and Point of Care Solutions (+7%) was the largest contributor to the division's sales growth. Serum Work Area solutions, comprising the immunodiagnostics (+10%) and clinical chemistry (+5%) businesses, were the main growth drivers. The cobas e 801 module for the Serum Work Area was launched in China.

Sales in Molecular Diagnostics increased 5%. In virology, sales are up 4%, with strong growth in HIV monitoring. Continued high demand was reported for cobas Liat tests, the new system for molecular point of care testing. Sales in the human papillomavirus (HPV) and blood screening businesses grew 17% and 3% respectively.

Tissue Diagnostics sales increased 9%. The advanced staining business continued its strong growth (+10%); demand for the primary staining portfolio was high (+16%).

Diabetes Care sales increased 1%, mainly driven by the new Accu-Chek Guide and Accu-Chek Instant systems.

About Roche
Roche is a global pioneer in pharmaceuticals and diagnostics focused on advancing science to improve people's lives. 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.


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.
Founded in 1896, Roche continues to search for better ways to prevent, diagnose and treat diseases and make a sustainable contribution to society. The company also aims to improve patient access to medical innovations by working with all relevant stakeholders. Thirty 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. Moreover, for the tenth consecutive year, Roche has been recognised as the most sustainable company in the Pharmaceuticals Industry by the Dow Jones Sustainability Indices (DJSI).

The Roche Group, headquartered in Basel, Switzerland, is active in over 100 countries and in 2017 employed about 94,000 people worldwide. In 2017, Roche invested CHF 10.4 billion in R&D and posted sales of CHF 53.3 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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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 any current or future period will necessarily match or exceed the historical published earnings or earnings per share of Roche


References
[1] Unless otherwise stated, all growth rates in this document are at constant exchange rates (CER: average 2017)
[2] US Food and Drug Administration prescribing information for Perjeta
[3] EMEA - Europe, Middle East and Africa


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