* Core EPS flat at 7.57 Sfr vs forecast of 7.50
* H1 sales 22.97 bln Sfr, compared to 22.98 bln in poll
* Confirms full-year guidance
* Shares rise 2.1 percent in early trade
(Adds details, analyst, shares)
By Caroline Copley
BASEL, July 24 Swiss drugmaker Roche
confirmed its full-year sales and profit targets on Thursday as
growing momentum for its new breast cancer medicines and
professional diagnostics products countered the effects of a
strong Swiss franc.
Unlike other pharmaceutical companies that have been ravaged
by patent losses, Roche has yet to face a challenge to its older
biotech drugs by makers of copycat treatments and has launched a
string of new, expensive cancer medicines.
The Basel-based firm hopes these so-called follow-on drugs
will help it defend sales in its breast and blood cancer
businesses once generic competition arrives.
Its strategy looked sound after first-half sales of Perjeta,
which targets the same protein found on some cancer cells as
Roche's older blockbuster Herceptin, surged 276 percent to 388
million Swiss francs ($429.68 million).
Another breast cancer drug Kadcyla notched up 227 million in
sales, compared to 83 million a year earlier.
Roche also won approval for Gazyva, a follow-on to its
top-seller MabThera in the United States last November. The drug
chalked up sales of 18 million in the first half.
A strong performance in its professional diagnostics
business, where sales rose 9 percent, also helped to offset flat
sales in its diabetes care unit.
First-half sales fell 1 percent to 22.97 billion Swiss
francs ($25.5 billion), generating "core" earnings per share of
7.57 francs. Excluding the impact of currencies, including a
weak U.S. dollar in particular, sales rose 5 percent.
Analysts in a Reuters poll had forecast sales to decline 1
percent to 22.98 billion francs and core earnings per share of
Roche confirmed guidance for low-to-mid single-digits sales
growth this year, while expecting core earnings per share (EPS)
to grow ahead of sales. It also plans to raise its dividend from
7.80 Swiss francs per share in 2013.
Berenberg analyst Alistair Campbell, who has a 'buy' rating
on the stock, described the results as "solid" and said Roche
was well on track to meet its full-year goals. Last week,
cross-town rival Novartis reported second-quarter
results that fell slightly shy of forecasts.
Shares in Roche, which have lagged those of Novartis so far
this year, rose 2.1 percent in early trading.
Chief Executive Severin Schwan acknowledged pressure on
healthcare authorities to rein in costs, but said Roche's
highly-targeted cancer medicines had been spared the brunt of
price pressure. He said prices for Roche had fallen 1 percent
worldwide, less than for the overall market.
Still, budget-conscious healthcare authorities have already
started to take measures to try and recoup some healthcare
Italy is seeking 1.2 billion euros ($1.6 billion) in damages
from Roche and Novartis for allegedly colluding to try and stop
cancer drug Avastin from being used to treat wet age-related
macular degeneration (AMD).
France has gone a step further and approved an amendment to
the social security budget to allow the use of Roche's Avastin
as a cheap alternative treatment for the eye disease.
Schwan said the two drugs had been developed for different
purposes and Roche believed that Lucentis remained the right
drug to treat the disease.
($1 = 0.9023 Swiss Francs)
(Editing by Sophie Walker)