Roche posts solid results ahead of looming patent cliff

Roche's pharma sales rose a healthy 7% in the third quarter, although the first signs of weakness for blockbuster immunology product Xolair are a warning of tougher times ahead.

Roche's drugs business brought in CHF 11.47 billion (nearly $14 billion) in the three months, slightly ahead of analyst expectations, and the company has maintained its full-year sales guidance of a mid-single-digit increase at constant exchange rates.

A good performance by Roche's top growth products, including top-selling multiple sclerosis therapy Ocrevus (ocrelizumab), Hemlibra (emicizumab) for haemophilia A, and eye drug Vabysmo (faricimab) – was the main driver of the result.

Xolair (omalizumab) for food allergies and chronic hives also grew in the quarter, rising 8% to CHF 848 million, but that represents a significant slowdown on recent quarters, below analyst predictions, and comes after the first low-cost biosimilars of omalizumab reached the US market.

Roche is riding a wave of patent expiries for some of its biggest sellers at the moment. Breast cancer therapy Perjeta (pertuzumab) shrank 9% to CHF 651 million in the third quarter as biosimilars rolled out in some markets, and the company is also facing looming competition to Kadcyla (trastuzumab emtansine), another breast cancer drug, as well as Ocrevus starting in 2028.

Facing the loss of billions of Swiss francs to competition in the coming few years, Roche has been working to build up its pipeline and signed a strategic-level, $15 billion alliance with China's Hansoh earlier this week – the latest in at least a dozen licensing deals and acquisitions made this year.

Roche's chief executive, Thomas Schinecker, said the group was making "meaningful progress" in its pipeline-building efforts, saying: "We advanced another five potential new medicines into the final stage of development this year and now aim to bring up to 20 new medicines to patients by 2030."

He also said that almost all of Roche's new pipeline additions had come from US and Chinese companies, with Europe lagging way behind. Earlier this week, Roche said it would put investment programmes in Germany on hold, blaming new pharma regulations and pricing reforms that had "destroyed" the industry's trust in the government.

Near-term potential comes from fenebrutinib, currently under priority review at the FDA as an oral therapy for relapsing and primary progressive MS, as well as new breast cancer hopeful giredestrant, which is due for a verdict from the US regulator before the end of the year.

Roche also pointed to an upcoming readout for PI3K inhibitor Itovebi (inavolisib) in PIK3CA-mutated, HR-positive/HER2-negative advanced breast cancer, after prior treatment with CDK4/6 inhibitors, that could extend its label.

Other highlighted projects in the update included: sefaxersen for immunoglobulin A nephropathy (IgAN); cancer therapies tambotatug pelitecan (tam-peli) and divarasib; obesity and diabetes candidates enicepatide, tifeglipron, and petrelintide; and ophthalmology therapies RG6209 and vamikibart.