# Roche flags 2023 earnings decline on slump in COVID products Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2023-02-02 Category: NEWS Category URL: https://financedigest.com/category/news Meta Title: Roche Warns of Earnings Decline in 2023 Meta Description: Roche expects a decrease in earnings in 2023 as COVID-related sales plummet, but the underlying business is still growing robustly. URL: https://financedigest.com/roche-flags-2023-earnings-decline-on-slump-in-covid-productshtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2023-02-02t070419z2lynxmpej1108ertroptp4roche-m-a-novartis-704x500-1-1736814514504-compressed.jpg) By Ludwig Burger BASEL (Reuters) – Roche warned of a decline in 2023 earnings, as revenue growth from new drugs, including its haemophilia treatment and multiple sclerosis drug, would not make up for a steep demand drop for COVID-19 treatments and diagnostic testing. Sales and core earnings per share were expected to decrease at a “low single-digit” percentage this year, the Swiss pharmaceuticals and diagnostics company said in a statement on Thursday. The demise of COVID related sales, mainly from lab testing and antibody treatment Ronapreve, would pose a 5 billion [Swiss franc](https://www.financedigest.com/swiss-franc-grapples-with-safe-haven-identity-crisis-after-credit-suisse.html "Swiss franc grapples with safe-haven identity crisis after Credit Suisse") ($5.5 billion) burden on this year’s revenues, but “the underlying business is growing very strongly in the high single digits,” said Chief Executive Severin Schwan. The pivot away from the coronavirus pandemic, which has dominated the agenda of most healthcare companies over the past three years, also weighed on rival diagnostics group Siemens Healthineers, which reported a 28% [drop in quarterly operating profit](https://www.financedigest.com/ford-posts-lower-profit-issues-downbeat-outlook-shares-drop.html "Ford posts lower profit, issues downbeat outlook; shares drop"). Shares were down 1.3% at their lowest [since March 2020 in early](https://www.financedigest.com/first-quarter-dash-for-cash-largest-since-early-2020-bofa.html "First quarter ‘dash for cash’ largest since early 2020 -BofA") trading. Last year, Roche group revenue [edged 1% higher](https://www.financedigest.com/londons-ftse-100-edges-higher-set-for-fourth-weekly-gain.html "London’s FTSE 100 edges higher, set for fourth weekly gain") to 63.3 billion Swiss francs, the company reported, beating market expectations of 63.2 billion francs, while core operating profit gained 1% to 22.2 billion Swiss francs, just shy of the average analyst estimate of 22.4 billion francs. Analysts have said that [market confidence in Roche’s drug development](https://www.financedigest.com/concrete-placing-booms-market-notable-developments-geographical-outlook.html "Concrete Placing Booms Market: Notable Developments & Geographical Outlook") abilities, previously among the highest in the industry, has taken a blow from trial setbacks last year in Alzheimer’s disease and a cancer immunotherapy hopeful. As a result, the stock has [fallen about 11% over the past three years](https://www.financedigest.com/twenty-years-cash-isas-uk-fallen-short-expectations-alternatives.html "Twenty years on, cash ISAs in the UK have fallen short of expectations: what are the alternatives?"), lagging its key global rivals. Roche has lagged rivals https://fingfx.thomsonreuters.com/gfx/mkt/myvmokkmmvr/roche.PNG REINVIGORATE PIPELINE The onus to reinvigorate the pipeline will be on chief executive officer-designate Thomas Schinecker, who was previously Roche’s head of diagnostics and due to be promoted to [group CEO](https://www.financedigest.com/shareholder-group-iss-backs-barclays-board-over-former-ceo-staley.html "Shareholder group ISS backs Barclays board over former CEO Staley") in March. In the wake of Schinecker’s appointment, the head of Roche’s pharmaceuticals division, Bill Anderson, decided in December to leave after 16 years with the Swiss drugmaker. Family-controlled Roche said on Thursday that Teresa Graham, currently [Head of Global](https://www.financedigest.com/new-york-catches-up-with-london-to-head-citys-global-centres-survey.html "New York catches up with London to head City’s global centres survey") Product Strategy for Roche Pharmaceuticals, would succeed Anderson. Speaking in a media call, [CEO Schwan said the company](https://www.financedigest.com/in-listening-mode-new-bayer-ceo-keeps-open-mind-on-company-split.html "In listening mode, new Bayer CEO keeps ‘open mind’ on company split") was analysing the failed trials thoroughly, but structural changes in research and development (R&D) were not called for, despite the planned changeover in management. I don’t [see any change](https://www.financedigest.com/the-sepsis-therapeutics-market-to-see-through-the-probable-sea-change-through-digitization.html "The Sepsis Therapeutics Market to see through the probable sea change through digitization") in the strategic direction. We believe that our strategy, which is very focused on [innovation both in pharma and diagnostics and is driving](https://www.financedigest.com/cyclic-innovation-to-drive-the-animal-parasiticide-market.html "Cyclic innovation to drive the Animal Parasiticide Market") more personalized healthcare solution, remains valid,” said Schwan, who will take the role of chairman of the board. Roche is not alone. Analysts were disappointed on Wednesday that GSK did not give more details on how one of the [world’s top](https://www.financedigest.com/top-10-fastest-bikes-in-the-world.html "Top 10 fastest bikes in the world") drugmakers plans to find its next set of blockbuster drugs. Roche’s bestseller multiple sclerosis drug Ocrevus [gained a currency-adjusted 17% in sales to just over 6 billion francs during the year](https://www.financedigest.com/hong-kong-home-prices-drop-15-6-in-2022-snap-13-years-of-gain.html "Hong Kong home prices drop 15.6% in 2022, snap 13 years of gain"), while its haemophilia treatment Hemlibra jumped 27% to 3.8 billion francs, both slightly above market expectations. The near-term commercial performance will depend on [newly launched](https://www.financedigest.com/newly-launched-quintessential-to-provide-prestige-living-management-platform-for-prs.html "Newly launched Quintessential to provide ‘prestige living’ management platform for PRS") drugs such as Evrysdi, an oral drug against muscle-wasting disease spinal muscular atrophy (SMA), and Vabysmo against a common cause of blindness in the elderly. Schwan pointed in particular to Vabysmo, with 591 [million francs in its market debut](https://www.financedigest.com/black-panther-sequel-ignites-box-office-with-330-million-global-debut.html "‘Black Panther’ sequel ignites box office with 0 million global debut") year. It was one of the best [launches ever](https://www.financedigest.com/coindesk-and-nycedc-team-up-to-launch-first-ever-blockchain-week-in-may-2018.html "CoinDesk and NYCEDC Team Up To Launch First Ever “Blockchain Week” in May 2018") in the history of Roche,” said Schwan. ($1 = 0.9079 Swiss francs) (Reporting by Ludwig Burger; Editing by Paul Carrel, Rashmi Aich and Josephine Mason) --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---