Roche prepares for business after boom from COVID-related products

By Louis Goss

Swiss pharmaceutical giant Roche on Wednesday said falling sales of COVID-19 tests and medicines will stop having a "material impact" on its business after the first quarter of 2024 following the end of a boom during the pandemic.

The Basel-headquartered company posted a 6% drop in sales, to 14.4 billion Swiss francs ($15.8 billion), as an increase in the value of the Swiss franc offset a slight increase in first-quarter group-wide sales, that continued to be dragged down by lower sales of COVID-19 products.

Roche Chief Executive Thomas Schinecker, however, said that "the COVID-19-related impact on sales is largely behind us" as he forecast a return to growth this year driven by growing demand for a raft of newly launched medicines.

Shares in Roche (CH:ROG) fell 3% on Wednesday, having lost 19% of their value over the previous 12 months following a series of underwhelming results caused by a slowdown in sales of COVID-19 products.

In the first quarter, sales from Roche's pharma and diagnostics segments increased by just 2% each, at constant exchange rates, to 10.9 billion Swiss francs and 35 billion Swiss Francs respectively.

Those sales were, however, pulled down significantly by slower sales of diagnostics tests for COVID-19 and of its medicines Actemra and Ronapreve, which it gained a license to manufacture and sell outside of the U.S. after the drug was first developed by Regeneron.

Sales of Roche's COVID-19 tests fell significantly, from 300 million Swiss francs in the first quarter of 2023 to 100 million Swiss francs in the first quarter of 2024.

Roche's pharma division would have otherwise seen its sales grow by 7%, at constant exchange rates, while the company's diagnostics division would have seen its revenue increase by 8% if lower sales of COVID-19 products had been excluded.

The Swiss company, meanwhile, confirmed its outlook for 2024, signaling it will achieve "mid single digit" sales growth throughout the year, as it said lower COVID-19-related sales would stop hitting its revenue.

-Louis Goss

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04-24-24 0651ET

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