) recently announced that it has entered into a collaboration
agreement with Ascletis to develop and commercialize Roche's
candidate danoprevir in China for treating patients suffering
from hepatitis-c virus (HCV).
The candidate is currently in a phase II study.
As per the collaboration agreement, Ascletis will fund and be
responsible for the development, regulatory affairs and
manufacturing of danoprevir in greater China, including Taiwan,
Hong Kong and Macau in return for payments from Roche as and when
commercial milestones are achieved.
The potential market for HCV is estimated at 10 million in
China with a majority of patients infected with genotype 1b.
Danoprevir is a protease inhibitor that is highly active against
Hence, Roche aims to develop a therapy and an effective new
treatment option for Chinese patients with HCV.
We note that Roche already has Pegasys in its kitty, which is
indicated for hepatitis B and hepatitis C. Sales of Pegasys were
down 15% year over year in the first quarter of 2013 as sales
fell in the US and Europe due to the launch of the
Pegasys plus ribavirin received approval in Europe in Mar 2013
for the treatment of chronic hepatitis C in children aged five
Additionally, other candidates being developed for HCV by
Roche are RG7128 (mericitabine) and RG7790 (setrobuvir). We note
that companies like
Merck & Co.
) have a presence in the HCV market with drugs like PegIntron and
Incivek (telaprevir) respectively.
Meanwhile, Roche continues to expect sales in 2013 to be flat
year over year as stated during the first quarter results on Apr
11, 2013. Sales are expected to be strong in emerging markets in
2013. Roche expects core earnings per share to grow at a higher
rate than sales in 2013. Roche expects to further increase its
dividend in 2013 as well.
Roche currently has a Zacks Rank #4 (Sell). As of now,
) looks well placed with a Zacks Rank #1 (Strong Buy).
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