Roche's 'blowout' cancer launches help fuel 10% profits hike

Fueled by a "blowout" launch of its new breast-cancer drug Kadcyla, Roche ($RHHBY) posted a 10% hike in profits for the first half of the year, on sales that topped analyst estimates at 7.58 billion Swiss francs, or about $8 billion. The rest of Roche's cancer portfolio delivered, too, with top-selling Rituxan bringing home 1.7 billion francs.

Roche CEO Severin Schwan

Approved by the FDA in February, Kadcyla brought in 65 million francs, or about $69.5 million, for the second quarter, Kepler Cheuvreux analyst Fabian Wenner told Bloomberg. For the entire half-year--the figures Roche reported today--Kadcyla garnered global sales of 83 million francs. Another new breast cancer treatment, Perjeta, approved by the FDA last November, accounted for 108 million francs.

"It was a blowout result," Wenner told the news service of Kadcyla's sales.

Roche needs new products to kick in as it prepares for biosimilar competition to its gold-standard older drugs, including Rituxan, a treatment for blood cancers and autoimmune disease, and Herceptin, the breast cancer therapy, which brought in 1.55 billion francs for the period. That's 3.25 billion francs at risk, or about $3.5 billion. Analysts are expecting biosimilars to hit in the U.S. as soon as 2015, but Roche now says it sees Rituxan biosims waiting till 2016.

Roche has been pushing beyond cancer, with R&D efforts in asthma, diabetes and Alzheimer's disease, among others. Its success has been limited so far; pharma chief Daniel O'Day noted today during the earnings call that the company may abandon heart and metabolic diseases completely. "We are still deciding," he said (as quoted by Bloomberg).

What else can Roche do to prep for competition? Deals, of course. The company is said to be eyeing a deal for Alexion Pharmaceuticals ($ALXN), the U.S.-based rare-disease specialist that reaps billions from small patient populations. Its Soliris treatment for two rare diseases brought in $1.13 billion last year. Though Roche CEO Severin Schwan wouldn't comment on a potential Alexion deal, he did say the company is eyeing bolt-on buyouts.

"As far as our overall innovation strategy is concerned there is no change," Schwan said (as quoted by Reuters). "It has always been our strategy to have internal and external innovation. ... [W]e will continue to focus on bolt-on acquisitions."

- see the Roche earnings release
- get more from Bloomberg
- check out the Reuters news
- here's more on diagnostics sales from FierceMedicalDevices

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