Roche Q1 sales decline tempered by swift uptake of new eye drug

By Ludwig Burger

(Reuters) -Switzerland’s Roche said first-quarter sales dropped 7% on falling demand for its COVID-19 therapies and diagnostics kits, less steep than feared by analysts due to strong revenue growth from a new eye drug.

Quarterly group revenue fell to 15.3 billion Swiss francs ($17.2 billion), the company reported on Wednesday, beating market expectations of 14.8 billion francs.

The company, which does not report earnings for its first and third quarter, reiterated that pandemic-related sales – mainly lab testing, antibody treatment Ronapreve and repurposed arthritis drug Actemra – would drop by 5 billion francs this year.

But quarterly sales of Vabysmo, an injection against a common form of blindness in the elderly that won approval last year, came in at 432 million francs, making it the strongest growth driver in the pharmaceuticals division, Roche said.

CEO Thomas Schinecker, previously Roche’s head of diagnostics and promoted to the top job last month, said new drug sales were strong across the board but Vabysmo beat consensus by more than 100 million francs in the quarter.

“We are very happy with the very rapid and significant uptake in the different markets around the world,” he said on a media call.

Roche is challenging Bayer (OTC:) and its partner Regeneron (NASDAQ:)’s established rival product Eylea, which is used to treat a common age-related degeneration of the macular in the back of the eye.

Vabysmo can be given at longer intervals between injections than the standard Eylea regimen, but Bayer and Regeneron are working on a high-dose version of their shot to offer the same advantage.

Roche said late on Monday that a deeper analysis of clinical trials suggested that a harmful excess of retinal fluid, which is often monitored by an ophthalmologist to track treatment progress, dried faster in patients on Vabysmo than those on a standard Eylea treatment.

Sales and core earnings per share were still expected to decrease at a “low single-digit” percentage in 2023, the pharmaceuticals and diagnostics company added.