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454 Revenues Pick Up in Q3, But Roche's Overall Genomic Sales Decline 12 Percent Year to Date

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By Julia Karow

This story was originally published Oct. 17.

Revenues of Roche's 454 Life Sciences unit increased in the third quarter compared to the second, while sales for Roche Applied Science's genomic analysis business, which comprises both 454 and Roche NimbleGen, declined 12 percent in local currencies during the first nine months of 2011.

According to Thomas Schinecker, 454's president, the unit experienced "strong quarter over quarter growth" in the third quarter due to sales of the GS FLX+ and reagent kits for the GS Junior.

Instrument revenues for the GS FLX platform grew 25 percent year-over-year during the third quarter, and 70 percent over to the second quarter, Schinecker told In Sequence by e-mail. Demand for the GS FLX+ long-read chemistry upgrade, which 454 launched in June (IS 6/28/2011), has been "exceeding our initial expectations," and the company expects to have "a significant percentage" of its installed GS FLX base upgraded by the end of the year.

Reagent sales for the GS FLX continued to lag, however, as customers in the process of transitioning from the GS FLX Titanium to the extra-long read chemistry "are holding off on their experiments," Schinecker said. Customers are increasingly using 454 in combination with short-read technologies, he added.

Kit usage for the GS Junior, on the other hand, increased "significantly" in the third quarter, "as customers incorporate the instrument into routine use." The number of GS Junior instruments in clinical and translational research labs worldwide is growing, he said, and the firm expects "strong instrument placements" in the fourth quarter.

Sales for the Roche Applied Science group as a whole were not so rosy. Year-to-date sales for the group fell to CHF544 million from CHF646 million a year ago — a 15 percent decline in Swiss francs and a 2 percent decline in local currencies.

Roche did not provide specific revenue numbers for the genomic analysis business, which declined 12 percent year to date, but provided a graph indicating that nine-month sales for the group were less than CHF150 million ($167 million).

Genomic analysis sales also decreased by 12 percent for the first half of the year. At that time, 454 attributed its revenue decline to delays in reagent sales for the GS FLX as customers were awaiting the upgrade to the GS FLX+ (IS 7/26/2011).

For the third quarter alone, Roche Applied Science — one of five business areas of Roche's diagnostic division — recorded CHF167 million ($186 million) in sales, a 15 percent decrease over CHF197 million during same period last year, and a one percent increase in local currencies. The company did not provide quarterly figures for the genomic analysis group.

In a nine-month earnings presentation last week, Roche attributed the decline in Applied Science revenues to "flat global research funding" and "continued impact from deceased H1N1 testing" compared to the previous year.

Applied Science was the only business area of Roche's diagnostic division — which also includes professional diagnostics, diabetes care, molecular diagnostics, and tissue diagnostics — that had declining nine-month sales.

Total year-to-date revenues for the diagnostic group were more than 7 billion CHF, a 6 percent increase in local currencies over the comparable period of 2010.


Have topics you'd like to see covered in In Sequence? Contact the editor at jkarow [at] genomeweb [.] com.

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