Roche Holding AG said that it still expects a small profit gain this year as demand for its best-selling medicines holds up and the drugmaker works on developing COVID-19 tests in one of the few industries cushioned from the pandemic.
Core earnings per share would grow by a percentage in the low to mid-single digit range this year, in line with sales, the Swiss company reiterated yesterday.
“Roche’s business has so far proved to be resilient in this difficult environment,” CEO Severin Schwan said.
The company said that it expects to further raise its dividend this year.
Roche’s preference for conservative forecasts might come in handy, allowing it to be one of the few companies to avoid trimming its outlook. Last year, it boosted its outlook three times in the course of the year.
While Roche’s diagnostics unit is a leader in developing COVID-19 tests, it is not clear that the pandemic would ultimately boost the division’s sales, as it also suffers from a disruption of routine testing for ailments such as cancer.
‘DISASTER’
Beyond the pandemic, Roche’s first-quarter results show that new medicines are growing faster than its old guard of blockbuster drugs are losing sales.
Some blood tests being marketed to tell people if they have ever had the new coronavirus are a “disaster,” Schwan said yesterday, as he prepares to launch the Swiss drugmaker’s own antibody test next month.
In developing its test, Roche scrutinized some existing products now on offer, but rejected them as unreliable in determining if somebody has actually ever had the disease, Schwan said.
“It’s a disaster. These tests are not worth anything, or have very little use,” Schwan told reporters on a conference call on the Basel-based company’s first-quarter results. “Some of these companies, I tell you, this is ethically very questionable to get out with this stuff.”
Roche shares are up about 5 percent so far this year, a rare bright spot in the broader stock market, while the Bloomberg European pharma index is little changed.
Additional reporting by Reuters
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