Swiss Drug Maker Roche Blames The Soaring Franc For Its 14% Drop In Sales

roche tamiflu

GENEVA (AP) — Swiss drug maker Roche Holding AG posted a 14 per cent drop Thursday in year-on-year sales for the first nine months of 2011, blaming Switzerland’s strong currency for weakening its results.

The Basel-based manufacturer of cancer-fighting drugs said sales for the three quarters — including those of its anti-influenza drug Tamiflu, which has been a big earner for the company in the past — fell to 24.4 billion Swiss francs compared with nearly $28.4 billion the same time last year.

But it noted that in terms of U.S. dollars its sales rose 4 per cent. Excluding Tamiflu, Roche said in a statement posted on its website, the drop was 13 per cent in francs — but an increase of 6 per cent measured in dollars.

The biggest producer of anti-cancer medications such as Herceptin and MabThera, known in the U.S. and Canada as Rituxan, saw sales of its best-selling drug Avastin drop after a U.S. Food and Drug Administration panel ruled breast cancer patients should no longer use it.

Roche CEO Severin Schwan called the company’s third-quarter performance “solid” and in line with its expectations for sales excluding Tamiflu to grow at low single-digit rates, based on constant exchange rates.

“We’re on track to achieve our targets for 2011,” he said

The company also has been pushing through a cost-savings program to raise its full-year earnings target in local currencies. Roche previously announced it would cut almost 5,000 jobs by the end of 2012.

The Swiss franc has hurt exporters this year by a run-up in its value that has made goods appear more expensive to foreign buyers.

But the Swiss central bank has moved to limit the franc’s strength to protect Swiss companies — and the nation’s relatively strong, stable economy — by setting a ceiling on the value of the currency against euros.

Roche shares closed Wednesday at 147.50 francs ($164.36) on the Zurich exchange.

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