Roche Plays Down Reliance On TIGIT And Alzheimer’s Drugs For Growth
Company Boasts 51 Late-Stage Candidates
Executive Summary
Pharma chief Bill Anderson was optimistic about growth prospects, and downplayed Roche’s reliance on two near-term readouts at an investor day in London.
Roche has presented its vision for its pharma division up until 2025, outlining a wave of new molecules and growth opportunities across its portfolio, and highlighting potential first-in-class launches across oncology, neuroscience and ophthalmology.
The company is arguing that it can achieve strong growth in the period, even while accepting much reduced analysts' consensus forecasts for two anticipated blockbusters, the Alzheimer’s candidate gantenerumab and TIGIT cancer hopeful tiragolumab, and even though their decisive trial readouts are not due until November 2022 and 2023, respectively.
The Swiss giant’s pharma leadership team was in London on 12 September to present to European analysts (after a three-year pandemic hiatus), and division head Bill Anderson detailed how the company would power through the next wave of biosimilar competition, and still keep growing.
Recent years have seen its trio of cancer blockbusters, Avastin (bevacuzimab), Herceptin (trastuzumab) and Rituxan/MabThera (rituximab) (collectively known as ‘AHR’), face biosimilar competition, losing CHF13bn ($13.7bn) in total revenues over last five years.
Bill Anderson
Even so, the company has grown by 9% over the same period, adding CHF15bn in new product revenues, led by the cancer drug Tecentriq (atezolizumab), MS therapy Ocrevus (ocrelizumab) and hemophilia drug Hemlibra (emicizumab), as well as a CHF4bn boost in 2021 from COVID-19 therapies, Actemra (tocilizumab) and Ronapreve (casirivimab/imdevimab).
Now the company faces further biosimilar competition to eye drug Lucentis (ranibizumab) and respiratory drug Xolair (omalizumab), plus a continued decline for AHR and the drying up of COVID-19 related revenues.
Anderson said the company was the sector’s biggest R&D spender, citing an R&D spend of around CHF60bn over a five-year period (2017-2021) compared with the equivalent of CHF51bn from its nearest competitor, Pfizer Inc.. This, he said, had helped give Roche the sector’s most valuable pipeline, which includes 51 candidates in Phase III or registration – a record for the company, and would fuel future growth.
“We're looking far out ahead, we absorbed the speed bumps along the way, and we keep marching,” he told the London meeting.
Re-Evaluating Prospects For Several Candidates
Nevertheless, the TIGIT drug's failure to achieve its co-primary endpoints in progression-free and overall survival in its SKYSCRAPER 1 study at an interim readout in May led analysts to re-evaluate its likely revenue prospects - Jefferies having previously forecast peak annual revenues of $2.5bn (Also see "Blow To Roche Growth Prospects As TIGIT Lung Cancer Trial Fails" - Scrip, 11 May, 2022.)
Bernstein's Wimal Kapadia judged that setback to have put the company's long-term growth targets in doubt, and lowered Bernstein's forecast for Roche's 2025-30 CAGR to just 1% (from the previous 1.2%). If one were to assume gantenerumab would also fail, this would largely wipe out Bernstein's forecast of combined peak annual sales for both drugs of CHF3bn. Moreover, the analyst also predicted that Roche's growth prospects for the period would drop close to nil if both drugs failed.
It was that kind of pessimistic outlook that Anderson wanted to counter with a more upbeat forecast. He argued that consensus estimates for its portfolio actually painted a promising growth story, even when the downgraded consensus forecasts were taken into account.
Looking ahead to its 2021-2025 period, Anderson reviewed analysts’ consensus forecast for its portfolio, with Tecentriq, Ocrevus and Hemlibra leading the way with 2022 revenue growth of between CHF2.7bn-CHF2.4bn each over the period.
Not far behind, are the newly launched next-generation ophthalmology drug Vabysmo (faricimab-svoa), forecast to hit CHF2.3bn in sales next year, with Evrysdi (risdiplam, CHF1.6bn forecast) and Polivy (polatuzumab, CHF1.1bn) also on strong growth trajectories.
Anderson acknowledged a ‘Pipeline 2’ of four late-stage candidates previously tipped for great things but where expectations have now dimmed. For gantenerumab, the consensus revenues for the period are CHF1.1bn – if it can prove its value in the fourth quarter of 2022 when the Phase III GRADUATE trials read out.
Meanwhile, consensus analyst peak sales forecasts for TIGIT drug tiragolumab have been downgraded to just CHF0.3bn. Alongside these are MS candidate fenebrutinib (now expected to hit just CHF0.4bn) and oral SERD drug girodestrant, now pegged at CHF0.2bn after a late-stage trial failure. (Also see "Roche's SERD Setback Means Menarini Retains An Edge" - Scrip, 25 Apr, 2022.)
Potential scenarios for gantenerumab’s readout in late 2022 and regulatory decisions in 2023 were among the most popular themes for analyst questions, but the company could not shed much light on how it would proceed ahead of the data.
Anderson was clear that the company was not counting on these riskier bets in Alzheimer’s and TIGIT paying off. “We're really excited about gantenerumab … but we are not dependent on it if gantenerumab goes away. Then the model goes from 18.6bn to 17.5bn. I think that's important to note, we're not a one-trick pony.”
While analysts have been pessimistic about Roche’s TIGIT prospects of late, Anderson was able to provide some encouraging updates on tiragolumab’s development program. The drug’s SKYSCRAPER 6 Phase III study in combination with Tecentriq and chemotherapy in first-line non-small cell lung cancer has just passed a futility analysis and will continue. Meanwhile, another Phase III, SKYSCRAPER 7, in first-line esophageal squamous cell carcinoma (with or without Tecentriq) will proceed to final results after an interim analysis.
Polivy Gets First-Line Status
Among the other near-term growth prospects highlighted was Polivy (polatuzumab vedotin), the company’s antibody-drug conjugate, now licensed for use in first-line diffuse large B-cell lymphoma (DLBCL).
Commercial head Theresa Graham said the drug’s efficacy demonstrated in Phase III studies was likely to change the standard of care in first-line therapy, and open up a patient pool three times larger than in refractory DLBCL. (Also see "Roche’s Polivy Set For Blockbuster Sales After Frontline Lymphoma Success" - Scrip, 9 Aug, 2021.)
Most importantly, she predicted that there would be no new competition for the drug in this setting for at least three and half years.
Anderson also highlighted other early-to-mid stage candidates in its pipeline which he said could also offer substantial upside to its forecasts. These include its bispecific antibody RO7247669, combining PD1 and LAG3 inhibition, and its KRAS molecule, GDC-6036 which the company believes has “best-in-class potential”. (Also see "Expectations Of Lumakras ESMO Late-Breaker Build As Roche Plays KRAS Catch-Up" - Scrip, 6 Sep, 2022.)
[Editor's Note: This article was updated on 12 September 2022 to note that the Phase III GRADUATE studies for gantenerumab will read out in 2022, not 2023.]