Roche Holding Ltd. (ADR) (OTCMKTS:RHHBY) may not grab your attention like Pfizer Inc. (NYSE:PFE), Merck & Co., Inc. (NYSE:MRK) or Swiss neighbor Novartis AG (NYSE:NVS), but it’s as big and as powerful as all these other Big Pharmas.
Healthcare has been getting kicked around in recent months, as we’ve transitioned to the Donald Trump presidency. First, investors were bullish that a Republican-dominated White House and Congress would mean less regulation and a friendlier, more pro-business environment.
Then, Trump tweeted that he thought drug prices were too high. Then, Congress had the hot potato of the Affordable Care Act (aka, Obamacare) to repeal and replace, which added even more uncertainty into the mix.
One thing that is certain is the big players will have a seat at the table regardless of what transpires. And that is a distinct advantage.
What Does This Mean for RHHBY Stock?
What may not be so apparent is that RHHBY is the biggest Big Pharma by market cap, aside from Johnson & Johnson (NYSE:JNJ) which is so diversified that it’s a bit more than just a Big Pharma.
Roche has many of the top selling drugs in the market today — Neupogen, Anaprox, Avastin to name a few — and has a very strong pipeline.
It is also becoming very competitive in the immuno-oncology space with its drugs Perjeta and now Alecensa. These drugs target non-small-cell lung cancer, which is becoming a very crowded space for this new class of drugs. That’s the case because this specific cancer is not responsive to most therapies and is usually inoperable. This allows drugmakers to see how their drugs work on humans that have no real recourse to other therapies. For patients, there has been little hope other than newer versions of chemotherapy and radiation.
The good news is, these next-generation drugs are getting better and better. Now they’re getting months more to live, without the debilitating effects of chemotherapy.
NVS was first to market with its drug Xalkori. It has now released a new version dubbed Zykadia. But RHHBY is now making a splash with Alecensa; it seems to be better tolerated and it was just awarded its second ‘breakthrough’ designation from the U.S. Food and Drug Administration.
Also, within the past week, Roche has announced that it is working with Germany-based BioNTech in venture worth $310 million to research and develop mRNA based individualized cancer vaccines.
The point is, RHHBY has not stopped its efforts to stay on the cutting edge, build a vital product pipeline and continue to provide great products. It’s also pretty shareholder friendly as well.
Currently, Roche is delivering a rock-solid 3.25% dividend, which helps smooth out the choppy waters that most healthcare stocks are now in.
Richard Band’s Profitable Investing advisory service helps retirement savers outperform the market without losing a minute of sleep along the way. His straightforward style and low-risk value approach has won seven Best Financial Advisory awards from the Newsletter and Electronic Publishers Foundation.