Note: This story has been updated with comments from the company's conference call to discuss the financial results.
NEW YORK – Roche on Wednesday announced that for the first nine months of 2024 its diagnostics division revenues were essentially flat at CHF 10.73 billion ($12.36 billion) compared to CHF 10.68 billion a year ago but rose 5 percent at constant exchange rates (CER).
Roche's total nine-month revenues rose 2 percent to CHF 44.98 billion ($51.81 billion) from CHF 44.05 billion during the same period in 2023. At CER, total revenues for the period rose 6 percent. Its pharmaceuticals division revenues rose 3 percent to CHF 34.26 billion from CHF 33.37 billion for the first nine months of 2023.
Within the diagnostics division, for the first nine months of the year Roche's core lab business revenues were up 4 percent to CHF 6.05 billion versus CHF 5.84 billion a year ago. Its molecular diagnostics business revenues were essentially flat at CHF 1.90 billion, while its pathology lab revenues were up 11 percent to CHF 1.16 billion from CHF 1.05 billion a year ago. Near patient care revenues were down 15 percent to CHF 1.62 billion from CHF 1.90 billion.
On a conference call to discuss the firm’s financial results, Roche Diagnostics CEO Matt Sause said the increase in sales was mainly driven by strong base business growth of 8 percent that was partially offset by a decline in COVID-19 testing sales.
Core lab sales were driven by immunodiagnostics and clinical chemistry products, while the molecular diagnostics business was impacted by a 62 percent decline in COVID-19-related sales. However, blood screening sales rose 15 percent and virology sales rose 12 percent.
Pathology lab sales were driven by growth in the advanced staining and companion diagnostics businesses. The decline in Roche’s near patient care business was due to a 51 percent drop in COVID-19 lateral flow testing, as well as a decline in blood glucose monitoring. Sause said that the blood glucose decline was due to the market shifting toward continuous glucose monitoring. Roche received CE marking in July for its continuous glucose monitor and is staggering its launch across countries in Europe, he added.
Sause also noted that the firm's acquisition of point-of-care testing firm LumiraDx closed in July, and the business is being fully integrated into the near patient care portfolio. Roche does not expect an immediate material contribution to sales from the acquisition but expects "a significant contribution to diagnostics divisional sales in the coming years," Sause said.
In addition, Roche CEO Thomas Schinecker said that in Q4 2023 there was a CHF 300 million government order of COVID-19 rapid antigen tests that will impact the Q4 2024 revenue comparisons, but after that quarter the COVID-19 effect "will not play a significant role going forward." He added that in 2025 the company will not provide guidance on any COVID-19-related sales because it’s "completely irrelevant; it's just going to be part of our normal business like all the other tests that we have."
Geographically, the diagnostics business saw sales growth in all regions with 6 percent growth in North America, a 5 percent increase in Europe, the Middle East, and Africa, 18 percent growth in Latin America, and a 2 percent increase in Asia Pacific. Sause said that the firm saw an anticipated slowdown in sales in China due to the broader macroeconomic environment, which it expects to continue into 2025. China is "still a critical market," and Roche continues to be the market leader, he added.
For the third quarter of 2024, Roche Diagnostics reported that its revenues rose 6 percent year over year at CER to CHF 3.52 billion from CHF 3.41 billion.
Roche confirmed its previous guidance for a mid-single-digit percent sales increase at CER for full-year 2024.
The company said core earnings per share are expected to rise in the high-single-digit percent range at constant exchange rates.