Roche Reports 10% Q1 Sales Growth Amid Expected Full-Year Slowdown Due to Declining COVID-19 Demand and Biosimilar Competition

Compiled by Fan Dongdong

On April 25, Roche announced that the company's sales in the first quarter increased by 10%. However, due to the gradually slowing growth rate of its COVID-19 product revenue and facing increasingly fierce competition from biosimilars, Roche CEO Severin Schwan recently predicted that the company’s sales in 2022 may be on par with its performance in 2021.

Earnings Report Shows Roche's Q1 2022 Revenue Reached 16.4 Billion Swiss Francs ($17.2 Billion), a 10% Increase Year-over-Year at Constant Exchange Rates. However, it is Important to Note that its COVID-19 Products Contributed Significantly to Q1 Growth, and Future Demand for These Products is Unlikely to Remain at Current Levels. As a Result, Roche Predicts a Rapid Decline in Sales of its COVID-19 Business (Including Diagnostic Tests and Therapeutics) Starting from Q2 2022, and Anticipates Slower Overall Performance Growth for the Rest of the Year. In Response, Roche Forecasts Losses Related to COVID-19 Drugs and Diagnostics Between $200 Million and $5 Billion for 2022.

Moreover, the company's sales in pharmaceuticals increased by 6%, including Ocrevus for multiple sclerosis (with sales exceeding $1.5 billion), Hemlibra for hemophilia (with revenue nearing $900 million), Phesgo for breast cancer, Evrysdi for spinal muscular atrophy, and Ronapreve-19, a COVID-19 drug primarily sold in Japan. Additionally, due to increasing competition from biosimilars, related revenue losses are expected to reach $2.6 billion, with specific mention of the anticancer drugs Avastin, Rituxan, and Herceptin. Roche stated that the total sales of these three drugs have already dropped by nearly $595 million, and they will face even more intense biosimilar competition in the Chinese mainland market in the future. In response, Roche anticipates that biosimilars will result in a performance loss exceeding 2.5 billion Swiss francs in 2022.

Despite Roche's oncology pipeline being a strong performance driver for the company, two clinical trials failed in the first quarter. In the Phase III SKYSCRAPER-02 study, the investigational anti-TIGIT immunotherapy tiragolumab, in combination with Tecentriq and chemotherapy, failed to meet the primary endpoint of progression-free survival in patients with extensive-stage small cell lung cancer (ES-SCLC). Roche also announced that the Phase II acelERA trial evaluating its oral selective estrogen receptor degrader (SERD) giredestrant did not meet the primary endpoint of progression-free survival in patients with advanced breast cancer.

However, Roche highlighted several new drugs expected to gain approval in Europe, as well as new indications for existing drugs, which could become potential new drivers of sales performance. In the first quarter of this year, the European CHMP recommended the approval of mosunetuzumab for the treatment of follicular lymphoma and expanded the indication approval for Tecentriq in treating early non-small cell lung cancer. Additionally, mosunetuzumab is expected to become the first CD20xCD3 T-cell engaging bispecific antibody available for treating follicular lymphoma. Just a few weeks ago, the CHMP also recommended the approval of Polivy for untreated diffuse large B-cell lymphoma.

Overall, Roche expects full-year sales in 2022 to remain stable or grow by no more than 5% at constant exchange rates. Schwan stated that a surge in COVID-19 cases this winter could potentially boost the company’s sales, but this scenario may not occur.

Reference Source:

1、Roche Predicts 2022 Revenue Decline Due to COVID-19, Biosimilar Competition

2、Roche drinks in COVID test sale gains but preps for the well to run dry

3、Roche posted a big Q1 sales gain. So why is the company expecting a slowdown later this year?