After a full-day presentation on the late-stage and early-stage drugs inits R&D pipeline on February 3 (see pages 24-25), analysts had ample reasons to be bullish about Swiss pharmaceutical company Roche.
While the firm did say that this year and next would be transition years, when earnings will likely be burdened by the cost of developing new products, it noted that from 1998, revenue from several new drugs will push up earnings.
Commenting on the fact that Roche plans to cut the fully-loaded cost of developing pharmaceutical products by 40% from an industry average of around $500 million to $300 million, analyst Genghis Lloyd-Harris of Credit Suisse First Boston said: "these are very aggressive figures but given that Roche tends to be on the conservative side," he is comfortable. The company is planning to reduce its research spending as a percentage of pharmaceutical revenue to 18% by the year 2000 from around 21% last year.
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