Switzerland's Roche Disappoints Market in 2004 Results

Swiss drug major Roche has reported full year results below market expectations, with group sales rising 12% to CHF29.52bn (US$24.85bn) in 2004. Nevertheless, core net profit rose 41% year-on-year to CHF4.34bn (US$3.65bn), against forecasts of CHF4.77bn (US$4.02bn). The increase was attributed to one-off gains from a bond issue and the sale of the company's OTC business to Germany's Bayer in the year.

Breaking the results down, sales were strong at US-based biotech Genentech, of which Roche owns a majority of the stock. Genentech's revenues from the anti-cancer drug MabThera grew 28% to CHF3.38bn (US$2.85bn). However, Roche's own products performed less well, with sales influenza drug Tamiflu lower than in 2004. The Swiss drugmaker continues to expect 2005 earnings to remain within 2004 levels, and clearly hopes that its new focus on tailored drugs and diagnostics will allow it to overcome future costs associated with R&D and the expiry of key patents.