Rising Swiss rivalry as Roche and Novartis target same diseases

John Miller
FILE PHOTO: Logo of Swiss drugmaker Roche is seen in Basel

By John Miller

ZURICH (Reuters) - Swiss drugmakers Roche and Novartis released data on Wednesday on treatments aimed at winning sales from each other in eye disease and multiple sclerosis, in a sign of rising rivalry.

Facing each other across the Rhine in Basel, the drugmakers have clashed and cooperated over the years, but their latest products point to more direct competition.

Roche <ROG.S> Chief Executive Severin Schwan is looking beyond cancer drugs to fresh treatment areas, while Novartis <NOVN.S> CEO Vas Narashiman bulks up in the same territory.

Roche said its port delivery system (PDS), which requires twice-yearly refills of a customised version of eye drug Lucentis, was as good as monthly injections against blindness-causing macular degeneration, a market Novartis also targets with its new medicine Beovu.

Meanwhile, Novartis said ofatumumab, its injectible leukaemia drug also known as Arzerra, showed promising results in relapsing multiple sclerosis, a clear shot at Roche's $4 billion-per-year (3.25 billion pounds) blockbuster Ocrevus.

Even as the two drugmakers go head to head, Novartis still owns a 33% voting stake in Roche worth some $18 billion, a remnant of a two-decade-old failed merger bid. This holding means Novartis gets dividend payouts from its rival.

Roche is offering a new option for patients wary of frequent, direct-in-the-eye injections with its PDS, a refillable, surgically inserted reservoir.

That mirrors a selling point for Beovu, which Novartis launched last year.

"We estimate $4 billion peak sales for the port," Zuercher Kantonalbank analyst Michael Nawrath said, calling the Roche device's potential "underestimated".

With its immune system-targeting ofatumumab, Novartis drugs division head Marie-France Tschudin says its once-monthly, at-home injections may appeal to MS patients now wary of exposure to the coronavirus during clinic trips, which are required twice-yearly for Roche's Ocrevus infusions.

Novartis sees ofatumumab's U.S. approval in June. Roche hopes its PDS gets approval "as soon as possible".

(Reporting by John Miller; Editing by Michael Shields and Alexander Smith)