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Fri, Jul 24, 2009 - Page 10 News List

Roche says half-year profit down 29 percent

AP , GENEVA, SWITZERLAND

Pharmaceuticals maker Roche Holding AG yesterday posted a 29 percent drop in net income for the first six months because of costs related to the takeover of ­California-based Genentech, but results were boosted by sales of Tamiflu in the face of the swine flu pandemic.

Sales of anticancer drugs also fed the profit of 4.1 billion Swiss francs (US$3.84 billion), which compared with SF5.7 billion in the year-earlier period, Roche said. Excluding exceptional items, net income attributable to Roche shareholders was up 11 percent at SF5.2 billion (US$4.9 billion).

Group sales were up SF2 billion to SF24 billion, an increase of 9 percent in Swiss francs.

“I am especially pleased about the excellent progress we’ve made in integrating Roche and Genentech,” CEO Severin Schwan said. “Work at Genentech’s research and early development center in South San Francisco has continued seamlessly with the existing management team.”

Schwan said the company would be realizing synergies from the merger sooner than originally anticipated because of the consolidation of the manufacturing network and streamlining administrative functions.

The company said total one-time integration costs would be approximately SF3 billion.

The acquisition strengthens Roche’s ability to deliver on innovation in its core pharmaceuticals and diagnostics businesses, Schwan said.

Roche completed its US$46.8 billion takeover of Genentech in March.

It said yesterday it would have largely finished the integration by the end of the year.

The company said sales of Tamiflu accounted for 4 percentage points of sales growth in the pharmaceuticals division.

Total Tamiflu production capacity, including other manufacturers, will be expanded to 400 million packs annually by the start of next year, Roche said. The antiviral drug has been bought by governments building up stockpiles as one of the most effective ways to counter the flu pandemic pending the delivery of a swine flu vaccine.

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