Roche Seen Kicking off Q1 Season With Sales Drop

Roche is poised to kick off the Big Pharma reporting season with a drop in sales due to weaker demand for top-selling Avastin and flu drug Tamiflu and governments' drive to cut drug prices.

U.S. regulators revoked Avastin's approval for use in treating breast cancer late last year after trials showed the drug failed to help patients live longer. European authorities have also limited use of the drug to treat this disease.

"What everyone would like to know is how badly Avastin is affected by the label withdrawal. This will be the key question," said Helvea analyst Karl-Heinz Koch.

Analysts polled by Reuters are on average forecasting a 10% slump in quarterly Avastin sales, while pharmaceutical sales at the group are seen sliding 9.2% to 8.836 billion Swiss francs ($9.86 billion) as Roche also grapples with the strong franc.

Roche only gives sales figures at the quarterly stage.

Investors will also focus during the reporting season on how Roche and its rivals are coping with a healthcare reform in the United States and a push from cash-strapped governments in Europe to slash the prices of drugs. Roche's top line is also likely to be hit by a 76% drop in sales of Tamiflu, a pill used to treat flu.

The absence of last year's windfall profits from drugs and vaccines to tackle the H1N1 swine flu pandemic will be a common theme for several European drugmakers during the earnings season.

Investors will next week eye full results from other large drugmakers, including Eli Lilly, Novartis, Johnson & Johnson and Abbott, for more insight into the health of the industry.