By Bhanvi Satija and Ludwig Burger
FRANKFURT (Reuters) – Shares in Swiss drugmaker Roche fell on Thursday after sales of its new treatments for eye diseases and hemophilia disappointed the market, even as its nine-month revenue broadly met expectations.
Although Roche raised its full-year adjusted profit forecast and has stepped up efforts to enter the fast-growing obesity market, investors worry it is relying too much on its older blockbuster drugs.
“This is lower quality growth that we wouldn’t normally want to see,” said Christoph Wirtz, portfolio manager at Rothschild & Co Wealth Management. Older cancer drug Rituxan and anti-inflammatory Actemra made up for shortfalls in hemophilia shot Hemlibra and eye disease drug Vabysmo, whose overseas sales were hit by a weaker dollar.
“Drugs that have lost exclusivity still work very well,” Wirtz said.
‘SCRATCHING THE SURFACE’ OF THE OBESITY MEDICATION MARKET
Roche raised its adjusted profit growth forecast to single-to-double digits, helped by cost controls and efforts to mitigate the near-term impact of U.S. tariffs, and maintained its mid-single-digit sales growth forecast.
Roche shares were down 2.8% at 1158 GMT.
The drugmaker is banking on the success of its newest treatments, as well as heavy investments in experimental obesity drugs, and last month advanced a candidate into a late-stage trial.
Chief Executive Thomas Schinecker said at a news conference that the weight loss market, dominated by Novo Nordisk and Eli Lilly, had enormous room for growth.
“I don’t think we’re overestimating the market, we’re just scratching the surface,” Schinecker said.
Group revenue rose 2% in constant currency to 45.9 billion Swiss francs ($57.9 billion) in the first nine months of the year, just below analyst forecasts of 46.2 billion to 46.4 billion francs.
Sales of the pharmaceutical division in the third quarter amounted to 11.57 billion Swiss francs ($14.59 billion), compared to analysts’ expectations of 11.84 billion francs.
Third-quarter sales of Roche’s much-watched Vabysmo, to counter a common form of blindness in older people, totaled 996 million Swiss francs ($1.26 billion), missing analyst expectations for the second straight quarter.
ROCHE CEO: WE ARE IN A “NICE GOOD SITUATION” REGARDING TARIFFS
As pharmaceutical companies struggle to cope with US President Donald Trump’s tariffs, Schinecker said Roche was well placed to have invested in US manufacturing and ongoing technology transfer of certain products.