Roche's diagnostics sales increase 5 percent in first half

July 26, 2012

Diagnostics sales at Roche Holding AG’s North American headquarters in Indianapolis rose 5 percent in the first half of the year, the Swiss drug and device firm reported Thursday.

Roche racked up nearly 1.3 billion Swiss francs, or nearly $1.4 billion, from North American sales of its diagnostic products. Excluding the impact of changing foreign exchange rates, that was 5 percent more than North American sales during the first six months of 2011.

Roche’s North American sales of professional diagnostics equipment, such as lab analyzers for hospitals and physician offices, leapt 9 percent, to about $511 million. Sales of its gene- and tissue-based tests rose 6 percent and 12 percent, respectively, to $213 million and $210 million.

Diabetes products, including blood-glucose monitors and insulin pumps, saw their sales fall by 1 percent, to about $296 million. Roche’s Indianapolis campus, which employs 2,900 people, includes manufacturing of test strips for blood-glucose meters sold around the world.

Roche did not disclose profit figures for its North American diagnostics unit. Overall, the company saw its first-half profit decline by 17 percent, versus the same period last year, due to one-time charges.

But strong sales of cancer drugs and cost-cutting contributed to a rise in core operating figures.

The world's biggest manufacturer of cancer drugs, which reports earnings only every six months, said it expects group sales to grow by a low- to mid-single digit rate provided exchange rates remain stable. It posted a drop in first-half profit to 4.26 billion Swiss francs ($4.3 billion), down from 5.15 billion francs ($5.2 billion) in the comparable January-to-June period of 2011.

Roche said its net income also fell 14 percent, mainly due to one-off costs of 858 million francs from the closure of its Nutley, N.J., site, where Valium was developed. The former U.S. headquarters is to be closed by the end of 2013 in a money-saving consolidation of research and development programs that the company said would result in annual savings of 370 million francs a year.

The Basel, Switzerland-based company reported $530 million in additional global restructuring costs that result in part from putting a halt in May to its testing of dalcetrapib, an experimental cholesterol medicine that the company had hoped would help replace blockbusters such as Lipitor.

In 2011, Roche said it had more than 80,000 employees worldwide, with more than a quarter of them in the United States.


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