Zacks_Analysts' Blog : Roche's RoActemra Approved in EU - Analyst Blog

Roche Holdings Ltd. (RHHBY) has been having an eventful run in recent times, and the latest news of the European Commission approving RoActemra (tocilizumab) adds to the string of recent developments.   

RoActemra has been approved for use as a treatment for active Systemic Juvenile Idiopathic Arthritis (sJIA) in patients who are two years and older and have responded inadequately to previous therapy with NSAIDs (nonsteroidal anti-inflammatory drugs) and systemic corticosteroids.

Outside Europe, where RoActemra is marketed as Actemra, the drug is already available as a treatment for active sJIA in patients two years and older.

Further, Actemra is currently marketed worldwide for the treatment of rheumatoid arthritis in adults who have either responded to, or who were intolerant to, previous therapy with one or more disease-modifying anti-rheumatic drugs or tumour necrosis factor (TNF) inhibitors.

Roche’s Actemra primarily faces competition from UCB’s (UCBJF) Cimzia and Abbott Labs’ (ABT) Humira.

Earlier this month, the company also reported positive data from a mid-stage trial (MILLY) of pipeline candidate lebrikizumab, being studied as a potential treatment for asthma in adults.

The study showed that the candidate met the primary endpoint of a statistical significant increase in FEV1 (Forced Expiratory Volume 1, a measure of lung function) in adults with asthma whose symptoms were inadequately controlled with inhaled corticosteriods (ICS). The study also demonstrated that patients who were dosed lebrikizumab experienced a lower rate of severe asthma attacks.

Last month, Roche reported its financial results for the first half of fiscal 2011. The company’s earnings came in at $1.85 per share for the first half, compared with $1.61 reported in the year-ago period. Earnings were helped by reduced research and development and financial expenses and a lower tax rate.

Half-yearly revenues declined 12% (in Swiss francs) from the year-ago period. However, revenues increased slightly from the previous year to $23,955 million, primarily due to favorable exchange rate movements.

Following the results for the first half of 2011, Roche increased its guidance for 2011 and expects total revenue and revenue from the Pharmaceuticals Division to grow in the low single-digit rates. The growth rate does not account for revenues from Tamiflu but includes the impact of US health care reform and European pricing pressure.

We currently have a Zacks #3 Rank (short-term Hold rating) on Roche.