Roche 2007 Profit Rises 25% on Sales of Cancer Drugs

Roche 2007 Profit Rises 25% on Sales of Cancer Drugs

Jan. 30 (Bloomberg) -- Roche Holding AG, the world's biggest maker of cancer medicines, reported full-year profit rose 25 percent after doctors prescribed more of its Avastin and Herceptin tumor-fighting drugs.

Net income for 2007 increased to 11.4 billion Swiss francs ($10.4 billion), or 11.85 francs per share, from 9.17 billion francs, or 9.86 francs, a year earlier, the Basel, Switzerland- based company said today in an e-mailed statement.

Avastin for colon cancer and the Herceptin breast tumor treatment are helping Roche grow faster than rivals such as Novartis AG who face competition from generic medicines. Roche is testing treatments developed with Genentech Inc. against more tumor types and for use earlier in the disease to expand sales. The company's also strengthening ties between its diagnostics and pharmaceutical units to boost sales of existing medicines.

``Roche looks like the best pharma play to me in Europe, if not in the global big pharma space,'' said Nick Draeger, who manages assets including Roche shares at Adamant Biomedical Investments in Basel. ``The company has a solid profile in terms of any patent expiry issues and it is still the leading company in oncology with Genentech.''

Avastin, Herceptin and Rituxan, a blood cancer treatment and Roche's best-selling medicine, were all developed by Genentech, the world's second-biggest biotechnology company. Roche holds a majority stake in the South San Francisco, California-based company, which reported on Jan. 14 a 6.4 percent rise in fourth- quarter net income.

Tamiflu

Roche shares fell 2.8 francs, or 1.5 percent, to 189.4 francs yesterday in Zurich trading. Investors are willing to pay 20.5 times Roche's earnings per share, compared with 12.6 times EPS for London-based Glaxo and 17.9 times for Novartis.

Roche shares fell the most in 13 months in October after third-quarter revenue missed analyst estimates. The company said at the time that revenue from Tamiflu, one of only two medicines that may help prevent an avian flu pandemic, had peaked because countries have purchased enough supply for an outbreak. Sales of the Herceptin breast tumor drug increased at the slowest rate in at least five quarters.

Basel, Switzerland-based Novartis said Jan. 17 full-year sales rose 8 percent to $39.8 billion, compared with a 15 percent rise in 2006. Sales of five products fell by almost half to $1.7 billion last year from 2006 after the medicines either faced generic competition or were pulled from the market.

Roche said in October it expected core earnings per share to grow faster than sales in 2007. Revenue from pharmaceuticals and for the company as a whole was forecast to grow more than 10 percent.

BLOOMBERG