By Ludwig Burger
(Reuters) -Switzerland’s Roche said first-quarter sales dropped 7% on falling demand for its COVID-19 therapies and tests, less steep than analysts had expected thanks to strong revenue growth from a new eye drug.
Group revenue fell to 15.3 billion Swiss francs ($17.2 billion), the company reported on Wednesday, beating a market view of 14.8 billion francs on a strong launch of anti-blindness treatment Vabysmo and better-than-expected sales of COVID antibody treatment Ronapreve.
The company, which does not report earnings for its first quarter, reiterated that pandemic-related sales – mainly lab testing, 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 head of diagnostics and in the top job since March, said Vabysmo sales 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’s Vabysmo is a challenger to Eylea, a rival product for a common age-related degeneration of the macula in the back of the eye, made by an alliance between Bayer and Regeneron.
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 shares dropped 1.8% at 1135 GMT, following initial gains, on concern that the strong performance of COVID treatment Ronapreve is not sustainable.
“You have some of the important pharma growth products beating expectations,” said Terence McManus, portfolio manager at Bellevue Asset Management in Kuesnacht, Switzerland.
“But a mixed element is Ronapreve. That contributed to the beat but you expect that to decline significantly over time because COVID is going away.”
Roche said that sales and core earnings per share were still expected to decrease at a “low single-digit” percentage in 2023.
(Reporting by Ludwig Burger; Editing by Kirsti Knolle, Friederike Heine and Sharon Singleton)
