The failure comes as Roche’s dependence on generating new blockbusters grows given the gateways now open to competitors to develop cheaper copies of its effective cancer drugs Herceptin, Avastin and Rituxan, which together deliver around $20 billion worth of sales per year.
Yet despite the hitches, Rountree believes the company’s policy of allocating significant funding to R&D will see Roche through the bumpy waters.
“I think they’ve got a viable strategy. They’re continuing to innovate and they’re investing a lot in R&D…the biosimilar (an almost identical biologic copy of an original drug) is a threat to them and they’ve just got to work harder. You’re going to get trial setbacks but they’ve just got to keep ploughing ahead with that innovation,” he argued.
Anticipating that sales projections for the company are likely to be “a little bit down but not horrendously”, the partner at the pharmaceutical consultancy said the financial firepower of the Swiss giant would stand it in good stead going forward.
“Each one (trial failure) is going to damage the forecast but I think the bigger picture is that there’s an enormous machine going on to innovate and people I would argue don’t bet against Roche, they’ve got a lot of history,” he said, even as investment bank Goldman Sachs sliced the company’s price target by 10 swiss francs to 325 swiss francs.
“They’ve got the double power of R&D compared to a lot of other big pharmaceuticals.”
