Please ensure Javascript is enabled for purposes of website accessibility

Roche Grows Revenue Despite Biosimilar Competition

By Brian Orelli, PhD - Jan 30, 2020 at 2:55PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Its newer drugs are more than making up for the waning sales of older medications.

Roche (RHHBY 0.60%) capped off 2019 with sales up 8% for the year to 61.5 billion Swiss francs ($63.5 billion); at constant currency exchange rates, sales would have been up 9%. Core earnings per share grew 11% to 20.16 francs.

Most of the top-line growth came from the pharmaceutical division, which grew revenues 10% year over year, thanks to growing sales of multiple sclerosis treatment Ocrevus, hemophilia treatment Hemlibra, and cancer treatments Tecentriq and Perjeta. Those gains more than made up for declining sales of cancer drugs MabThera/Rituxan, Herceptin, and Avastin, which now face competition from biosimilars in various countries.

Revenues from Roche's smaller diagnostic division only grew 1%, although the company highlighted its immunodiagnostics business, which helped its centralized and point-of-care-solutions products grow 3% at constant exchange rates.

Assuming shareholders approve, the drugmaker plans to increase its dividend to 9 francs per share -- which would make 2020 the 33rd consecutive year it has boosted its payout.

Doctor talking to a patient in an exam room

Image source: Getty Images.

Roche gained two Food and Drug Administration approvals during the fourth quarter: Tecentriq as a first-line treatment for metastatic, non-squamous, non-small-cell lung cancer; and Xofluza for the treatment of flu. It also gained an expanded approval in Europe for Kadcyla as a treatment for HER2-positive breast cancer after surgery. During the quarter, the company also closed its $4.8 billion acquisition of Spark Therapeutics, which gave the company access to Luxturna, a treatment for a genetic condition that leads to blindness, as well as the rest of Spark's gene therapy pipeline.

This year, management expects sales to grow in the low-to-mid-single-digit percentage range at constant currency rates. Growth in core earnings per share is expected to be in a similar range.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Roche Holding AG Stock Quote
Roche Holding AG
RHHBY
$41.82 (0.60%) $0.25

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
323%
 
S&P 500 Returns
112%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 07/07/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.