Roche has good cause to call on Genentech to prevent it from losing its long-standing dominance in cancer. While the pharma is late to the party in immuno-oncology, its former biotech unit is behind at least three positive moves that could help it recover the lost ground.
The Genentech Inc. unit has established itself as Roche’s primary growth driver, serving as its primary U.S. commercial engine -- a market that is gaining in importance to the pharma’s balance sheet.
Over the past five years, U.S. revenues have contributed an increasing proportion of Roche’s top line (see Figure: “Genentech’s Sales Share”).
Figure: Genentech’s sales share
The Genentech Inc. unit of Roche (SIX:ROG; OTCQB:RHHBY) has contributed the lion’s share of products and total sales to the pharma. Among the pharma’s 20 top selling products, 13 originated at Genentech (yellow), while five came from Roche (green). Roche’s Chugai unit (orange) has contributed almost as much in sales as the Roche division. The Genentech unit also serves as Roche’s commercial hub in the U.S., which has accounted for an increasing proportion of Roche’s total sales over the last five years. In that time, sales in Europe and Japan have largely remained flat. Source: Roche earnings
Among Roche’s top 20 drugs by sales in 2018, 13 (65%) were spawned at Genentech prior to its