Roche Holding Ltd · SIX:RO
Roche — H1 2024 Earnings Presentation
61 slides from Roche's earnings presentation, Jul 24, 2024
Slide 1: Roche
Slide 2: Forward-looking statements
This presentation contains certain forward-looking statements. These forward-looking statements may be identified by words such as ‘believes’, ‘expects’, ‘anticipates’, ‘projects’, ‘intends’, ‘should’, ‘seeks’, ‘estimates’, ‘future’ or similar expressions or by discussion of, among other things, str
Slide 3: Roche HY 2024 results
Roche HY 2024 results Basel, 25 July 2024
Slide 4: Group
Group Thomas Schinecker Chief Executive Officer
Slide 5: Performance Outlook
Performance Outlook
Slide 6: HY 2024: Strong business performance in both divisions
HY 2024: Strong business performance in both divisions Sales growth acceleration in the second quarter and double digit core operating profit growth in H1 Group sales +5% at CER driven by strong base business of +8% • Strong Pharma (+8% at CER) and Diagnostics (+9% at CER) base business growth • COV
Slide 7: HY 2024: Group growth at +5% with base business growing +8%
HY 2024: Group growth at +5% with base business growing +8% Both divisions with continued strong momentum HY 2024 HY 2023 Change in % Excl. CHFbn CHFbn CHF CER C191 Pharmaceuticals Division 22.6 22.5 1 5 8 Diagnostics Division 7.2 7.3 -1 5 9 Roche Group 29.8 29.8 0 5 8 1Base business=Pharma excludin
Slide 8: HY 2024: Acceleration of growth momentum in second quarter
HY 2024: Acceleration of growth momentum in second quarter No significant COVID-19 impact going forward Group base business sales growth Group sales growth excluding COVID related sales1 %CER %CER +15% +15% +10% +9% +9% +10% +9% +8% +7% +5% +5% +3% +3% +2% +2% +1% +1% 0% 0% COVID-19 Pandemic -3% COV
Slide 9: HY 2024: High single digit growth in both divisions in Q2
HY 2024: High single digit growth in both divisions in Q2 Second quarter without significant COVID-19 impact Pharma* Diagnostics* Quarterly sales evolution 2022-2024 Quarterly sales evolution 2022-2024 % CER % CER 30% 30% +24% 20% 20% +12% +9% +10% +8% +9% 10% +6% +9% +7% +7% +7% +9% 10% +7% +8% +8%
Slide 10: Key growth drivers of the Roche portfolio in 2024
Key growth drivers of the Roche portfolio in 2024 Establishing new leadership positions while further diversifying our portfolio +5% HY 2024 sales Diagnostics: +9% base business growth (+9%) (YoY CER growth) +2% Adj. ALK+ NSCLC included in NCCN guideline as Significant launches in Q2 and upcoming ca
Slide 11: CE mark approvals for two key Diagnostics products
CE mark approvals for two key Diagnostics products Diagnostics to deliver mid to high single digit growth in coming years cobas ISE neo and Continuous glucose Next generation Mass spectrometry cobas c703 monitoring (CGM) sequencing (NGS) • Up to 100% higher throughput • 14 day real-time glucose sens
Slide 12: Progress on key strategic initiatives
Progress on key strategic initiatives Updated Group and Pharma strategies to be presented at Pharma Day on September 30th 2023 2024 Milestones achieved Q2 Q3 Q4 Q1 Q2 Q3 Q4 • Revised Ten-Year Ambitions and Group Strategy Group Presentation @ • New performance and reward practices rolled out Pharma D
Slide 13: R&D Excellence update
R&D Excellence update Implementation ongoing to strengthen and accelerate our pipeline Transform portfolio management 1 Set ambitious R&D objectives 2 Strengthen portfolio 3 & governance Q4 ’23 Q1 Q4 ‘23 Set clear and ambitious targets for all Introduced ‘the Bar’ Established end-to-end R&D producti
Slide 14: Performance Outlook
Performance Outlook
Slide 15: Young portfolio to drive growth in the near- to mid-term
Young portfolio to drive growth in the near- to mid-term 2024 NME update: US approval for PiaSky in PNH achieved; inavolisib in HR+ breast cancer with PDUFA 27 Nov CHFm % of Pharma Sales2 14.0 55% 12.0 50% 10.0 41% 8.0 33% 6.0 1 4.0 2.0 0.0 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 HY 2021 H
Slide 16: Key growth drivers beyond 2025
Key growth drivers beyond 2025 Many opportunities with significant market potential in both divisions Pharmaceuticals Diagnostics NME Indication Newsflow Timing Product Description Launch tiragolumab NSCLC Final Ph III data H2 2024 Total solution for clinical mass i601 mass spec 2024 spectrometry an
Slide 17: Key growth drivers beyond 2025
Key growth drivers beyond 2025 Many opportunities with significant market potential in both divisions Pharmaceuticals Diagnostics NME Indication Newsflow Timing Product Description Launch tiragolumab NSCLC Final Ph III data H2 2024 Total solution for clinical mass i601 mass spec 2024 spectrometry an
Slide 18: Positive 2024 outlook
Positive 2024 outlook Sales drivers1 Continued strong base business growth in both divisions Group sales growth1 Mid single digit sales growth COVID-19 sales expected to decline by roughly CHF 1.1bn LOE2 impact of roughly CHF 1.4bn expected Base business=Pharma excluding Ronapreve and Diagnostics ex
Slide 19: 2024 guidance raised
2024 guidance raised Core EPS guidance raised from “broadly in line with sales” to “high single digit Core EPS growth” Group sales growth1 Mid single digit sales growth High single digit Core EPS growth Core EPS growth1 excl. impact from resolution of tax disputes in 2023 Dividend outlook Further in
Slide 20: Finance
Finance Alan Hippe Chief Financial Officer
Slide 21: Upcoming Roche IR events 2024
Upcoming Roche IR events 2024 Additional events driven by readouts CVM/EASD Pharma Day Neurology/CTAD Digitalization Day Sep 13 Sep 30 Oct/Nov Nov/Dec • Key data presented at EASD: • Group & Pharma strategy • Key data presented at CTAD: • Roche digital efforts in Pharma • CT-388 (Ph I cohort 11 & 12
Slide 22: Results, Cash & balance sheet, Currency guidance & outlook
Results Cash & balance sheet Currency guidance & outlook
Slide 23: HY 2024: Group performance
HY 2024: Group performance Sales increase of +5% and Core EPS increase of +9% HY 2024 HY 2023 Change in % CHFm CHFm CHF CER Sales 29,848 29,779 0 5 Core operating profit 11,293 10,911 4 11 as % of sales 37.8 36.6 Core net income 8,651 8,587 1 8 as % of sales 29.0 28.8 Core EPS (CHF) 10.23 10.10 1 9
Slide 24: HY 2024: Base business overcompensating for COVID-19 and LOE
HY 2024: Base business overcompensating for COVID-19 and LOE COVID-19 and LOE impact in line with guidance; currency impact of -5%p in HY CHFm +5% at CER +574 +2,301 -518 -600 -1,446 -242 29,779 29,848 HY 2023 Dia Dia Pharma Ronapreve LOE Fx HY 2024 base COVID-19 (excl. Ronapreve & sales business sa
Slide 25: HY 2024: Group core operating performance
HY 2024: Group core operating performance Core operating profit higher by +11% driven by higher sales and effective cost management HY 2024 HY 2024 vs. HY 2023 CHFm abs. CER CER growth Sales 29,848 +1,515 5% Other revenue 908 +94 11% Cost of sales -7,300 -168 2% R&D -6,268 -21 0% SG&A -6,376 -96 2%
Slide 26: HY 2024: Core operating profit and margin
HY 2024: Core operating profit and margin 49.6% 50.4% % of sales +0.9%p¹ 36.6% 37.8% +1.9%p¹ +11%¹ +7%¹ 22.0% CHFm 20.4% 11,293 11,157 11,409 +3.3%p¹ 10,911 +22%¹ 1,480 1,583 HY 2023 HY 2024 Roche Group Pharma Division Diagnostics Division Note: Group Core operating profit includes -1.7bn from Corpo
Slide 27: HY 2024: Core net financial result
HY 2024: Core net financial result Decrease mainly due to increased interest expenses CHFm • Net financial result decreased by -306m / +54% at CER • Interest expenses1 increased by -225m / +58% at CER -582 -838 +45 -25 -209 -67 HY 2023 Equity Net interest Interest Other HY 2024 securities income exp
Slide 28: HY 2024: Core tax rate
HY 2024: Core tax rate Tax rate up due to Pillar Two top-up tax in 2024, partially offset by favourable profit mix +0.4%p 16.9% 17.3% 1.8% Impact of Pillar Two top-up tax Effective tax rate excl. impact from Pillar Two top-up tax 16.9% -1.4%p 15.5% Effective tax rate Effective tax rate HY 2023 HY 20
Slide 29: HY 2024: Core EPS development
HY 2024: Core EPS development Increase in operations partially offset by lower gains on product disposals and higher interest expense +8.9% - 2.3%p - 2.3%p 10.78 + 13.9%p - 0.4%p 9.90 HY 2023 Operations1 Product disposals Financial Tax rate change HY 2024 Income/Expense All values at CER=Constant Ex
Slide 30: HY 2024: Non-core and IFRS income
HY 2024: Non-core and IFRS income Non-core operating expenses higher vs. PY mainly due to higher impairments of intangible assets HY 2023 HY 2024 Var. Change in % CHFm CHFm at CER CHF CER Core operating profit 10,911 11,293 +1,113 +4 +11 Global restructuring plans -678 -762 -104 Amortisation of inta
Slide 31: Results, Cash & balance sheet, Currency guidance & outlook
Results Cash & balance sheet Currency guidance & outlook
Slide 32: HY 2024: Group operating free cash flow
HY 2024: Group operating free cash flow OFCF +9%; higher cash operating profit, partly offset by NWC movement and higher IA investments CHFm -316 +171 +1,210 -487 -71 -137 -315 7,682 8,368 8,053 OFCF up by +9%/+686m at CER HY OP, net of cash NTWC Other NWC Investments Investments HY Foreign HY start
Slide 33: HY 2024: Group net debt development
HY 2024: Group net debt development Net debt higher by CHF 6.9bn vs. YE 2023 CHFbn Free Cash Flow CHF +5.6 [PY: +6.1] [PY: -15.6] [PY: +8.0] [PY: -1.9] [PY: -8.4] [PY: -17.9] Taxes -2.0 Dividends paid -7.9 -18.7 Treasury -0.5 M&A & All. trans. -2.5 Curr. Transl. & Oth. -1.6 -2.5 Trans. own eq. inst.
Slide 34: Balance sheet 30 June 2024
Balance sheet 30 June 2024 Equity ratio at 34% (31 Dec 2023: 37%, 30 June 2023: 36%) % change in CER % change in CER vs 31 Dec 2023 vs 31 Dec 2023 CHFbn 95.8 +3% 95.8 +3% Cash and 90.5 90.5 8.8 -13% marketable 10.5 9% 26.6 securities 12% +4% +5% Current 24.8 24.8 28% Other 23.0 liabilities 27% 26% c
Slide 35: Results, Cash & balance sheet, Currency guidance & outlook
Results Cash & balance sheet Currency guidance & outlook
Slide 36: Expected 2024 currency impact
Expected 2024 currency impact USD / CHF Assumed avg. YTD 2024 Assuming the 28 June 2024 exchange rates remain stable -6% -3% -1% -1% until end of 2024, 0.93 0.91 2024 impact1 is expected to be (%p): 0.90 0.90 0.87 Q1 Q2 Q3 Q4 0.89 0.89 0.89 Sales -8 -2 0 0 0.86 0.88 0.89 0.91 0.91 0.89 0.90 0.90 0.9
Slide 37: 2024 guidance raised
2024 guidance raised Core EPS guidance raised from “broadly in line with sales” to “high single digit Core EPS growth” Group sales growth1 Mid single digit sales growth High single digit Core EPS growth Core EPS growth1 excl. impact from resolution of tax disputes in 2023 Dividend outlook Further in
Slide 38: Pharmaceuticals Division
Pharmaceuticals Division Teresa Graham CEO Roche Pharmaceuticals
Slide 39: HY 2024: Pharmaceuticals sales
HY 2024: Pharmaceuticals sales All regions ex-Japan delivering strong growth, Japan impacted by Ronapreve sales in Q1 2023 HY 2024 HY 2023 Change in % CER w/o CHFm CHFm CHF CER Ronapreve Pharmaceuticals Division 22,637 22,511 1 5 8 United States 11,882 11,573 3 5 5 Europe 4,425 4,105 8 10 10 Japan 1
Slide 40: HY 2024: Pharmaceuticals core operating profit
HY 2024: Pharmaceuticals core operating profit Core operating profit higher by +7% driven by cost management and higher sales HY 2024 HY 2024 vs. HY 2023 CHFm abs. CER CER growth Sales 22,637 +1,184 5% Other revenue 886 +111 14% Cost of sales -4,031 -213 5% R&D -5,335 -9 0% SG&A -3,197 -31 1% OOI&E
Slide 41: HY 2024: Young portfolio delivering strong growth
HY 2024: Young portfolio delivering strong growth Vabysmo and Phesgo excellent growth momentum continues; Polivy on-track for blockbuster status Vabysmo 93% Phesgo 60% Ocrevus 8% Polivy 54% Evrysdi 25% Hemlibra 7% Xolair 10% Columvi >500% Gazyva 15% Alecensa 7% Xofluza 183% Actemra / RoActemra 3% En
Slide 42: Inavolisib in 1L PIK3CA-mut HR+ breast cancer received FDA BTD
Oncology solid tumors / Hematology Inavolisib in 1L PIK3CA-mut HR+ breast cancer received FDA BTD Tecentriq SC with strong EU launch, reaching 32% conversion rate in UK Others Q2 update Avastin CHFm 331 / -7% • Phesgo: Strong uptake and conversion at 41% (51 countries)* CHFm 654 / -16% Perjeta • Per
Slide 43: Polivy US patient share in 1L DLBCL reaching 26%
Oncology solid tumors / Hematology Polivy US patient share in 1L DLBCL (IPI 0-5) reaching 26% Hemlibra US/EU-5 patient share climbing to 41% Columvi Lunsumio CHFm 37 / +34% Q2 update CHFm 67 / >500% Gazyva PiaSky • Hemlibra: Continued penetration across all approved patient CHFm 2 / N/A segments wit
Slide 44: Columvi + GemOx reduces risk of death by 41% in 2L DLBCL
Oncology solid tumors / Hematology Columvi + GemOx reduces risk of death by 41% in 2L DLBCL1 Ph III ( STARGLO): Columvi is the first CD20xCD3 bispecific to demonstrate an OS benefit in DLBCL Ph III (STARGLO) in 2L DLBCL*: Results Median OS Efficacy results R-GemOx Columvi + GemOx (n=91) (n=183) Medi
Slide 45: EU filing of Elevidys in DMD completed
Neurology EU filing of Elevidys in DMD completed Ocrevus market leader in US/EU5 with 26% global patient share and >350k patients treated Elevidys CHFm 29 / N/A Others Q2 update CHFm 217 / +25% Enspryng • Ocrevus: #1 new to brand in US; higher retention rate than other CHFm 143 / +32% MS medicines;
Slide 46: Xolair in food allergy already with >15k patients on treatment
Immunology Xolair in food allergy already with >15k patients on treatment Gazyva Ph III (REGENCY) in lupus nephritis to readout in Q3 2024 Q2 update Others CHFm 472 / -13% • Xolair: Strong food allergy launch with >15k patients on treatment only four months post-launch MabThera/ • Additional growth
Slide 47: Vabysmo US market share growth in nAMD, DME and RVO continues
Ophthalmology Vabysmo US market share growth in nAMD, DME and RVO continues Vabysmo pre-filled syringe approved in the US Luxturna CHFm 10 / +26% Susvimo Q2 update Lucentis CHFm 1 / -26% • Vabysmo: Continued market share gains across early launch CHFm 87 / -70% countries and ongoing global expansion
Slide 48: Susvimo: US commercial nAMD relaunch commencing, ex-US 2025+
Ophthalmology Susvimo: US commercial nAMD relaunch commencing, ex-US 2025+ Continuous delivery for predictable and immediate 6-month durability preferred by 93 % patients vs IVT1 nAMD: Visual acuity gains Ongoing development for the Port Delivery Platform equivalent to monthly injections Ph III (ARC
Slide 49: CT-388 and CT-996 demonstrating strong weight loss effect
Cardiovascular & Metabolism CT-388 and CT-996 demonstrating strong weight loss effect Ph I CT-388 topline results indicate best-in-class potential; Additional data to be shared at EASD GLP-1/GIP RA (CT-388) Ph I topline results for CT-388 in obesity2 Percent change in body weight by week* Adenylyl c
Slide 50: Pipeline update: Strengthening the Pharma pipeline
Pipeline update: Strengthening the Pharma pipeline Portfolio shaping ongoing: Focus on high-impact projects led to termination of 25% of total NMEs since Q2 23 NME changes in Q2 NME and LE (QoQ change, Q2 24 vs Q1 24) ±0 2 ±0 6 8 -1 Phase Indication RG6377 I IBD ±0 11 +1 9 cMET ADC* I Solid tumors -
Slide 51: 2024: Key newsflow
2024: Key newsflow* Compound Indication Milestone Alecensa Adjuvant ALK+ NSCLC US/EU approval inavolisib + palbociclib + fulvestrant 1L PIK3CA-mut HR+ BC US/EU filing Tecentriq Subcutaneous administration US/EU approval EU PiaSky (crovalimab) PNH US/EU approval US Elevidys DMD EU filing Ocrevus 6m S
Slide 52: Diagnostics Division
Diagnostics Division Matt Sause CEO Roche Diagnostics
Slide 53: HY 2024: Diagnostics Division sales
HY 2024: Diagnostics Division sales Strong base business growth more than offsetting decline in COVID-19 sales HY 2024 HY 2023 Change in % Excl. CHFm CHFm CHF CER C191 Diagnostics Division 7,211 7,268 -1 5 9 Core Lab 4,069 3,935 3 10 22 Molecular Lab 1,275 1,288 -1 3 33 Near Patient Care 1,097 1,358
Slide 54: HY 2024: Diagnostics highlights
HY 2024: Diagnostics highlights Strong base business growth more than offsetting decline in COVID-19 sales CHFbn YoY CER growth • Immunodiagnostics (+11%) Core Lab +10% • Clinical Chemistry (+8%) • Custom biotech (+5%) • COVID-19 (-67%) Molecular Lab1 +3% • Blood Screening (+13%) • Virology base bus
Slide 55: HY 2024: Diagnostics regional sales
HY 2024: Diagnostics regional sales Strong base business growth across all regions North America +5% EMEA ~30% of divisional sales +4% ~34% of divisional sales Asia Pacific Latin America +3% +16% ~29% of divisional sales ~7% of divisional sales Base business=excluding COVID-19-related products; Grow
Slide 56: 2024: Diagnostics core operating profit
2024: Diagnostics core operating profit Core operating profit higher by +22% HY 2024 HY 2024 vs. HY 2023 CHFm abs. CER CER growth Sales 7,211 +332 5% Other revenue 22 -17 -44% Cost of sales -3,269 +44 -1% R&D -933 -11 1% SG&A -1,485 -71 5% OOI&E 37 +25 205% Core operating profit 1,583 +302 22% Core
Slide 57: cobas ISE neo and cobas c703
Core Lab cobas® ISE neo and cobas® c703 CE market launch of high-volume clinical chemistry and ISE testing analytical units on cobas pro integrated solutions Increased throughput & more Increased flexibility, Numerous differentiating Simplified serviceability through reagent positions on cobas® pro1
Slide 58: cobas liat SARS-CoV-2, Flu A/B & RSV
Near Patient Care cobas® liat SARS-CoV-2, Flu A/B & RSV Four-in-one molecular POC test for SARS-CoV-2, Influenza A/B viruses and RSV receives FDA EUA1 • Detection and differentiation of four respiratory targets in one test: o SARS-CoV-2, RSV, Influenza A and B • Prompt diagnosis at the Point of Care
Slide 59: Accu-Chek SmartGuide CGM solution
Near Patient Care Accu-Chek SmartGuide CGM solution Authorized for launch in CE mark countries Accu-Chek SmartGuide CGM solution Improving diabetes management and care continuum • 14 days of reliable and accurate real-time glucose sensor data • One-step application with initial calibration • Predict
Slide 60: Diagnostics key launches 2024
Diagnostics key launches 2024 Area Product Description Markets Status i601 mass spectrometry Launch of an unique total solution for clinical mass spectrometry testing: fully automated, integrated and CE system IVD-compliant Core Lab cobas c703 Introducing high-throughput clinical chemistry testing t
Slide 61: Doing now what patients need next
Doing now what patients need next