Roche Ends Five Trials, Schinecker to Succeed Schwan as CEO (Updated)
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After 14 years at the top, Roche Chief Executive Officer Severin Schwan will step down from his role at the helm of the Swiss pharma giant next year. This was announced Thursday morning, along with the company's half-year financial results for 2022.
Out with the Old; In with the New
He will become the new chairman of the company's board of directors upon the retirement of current chair Christoph Franz.
As Schwan prepares to step aside from the day-to-day leadership of Roche, Thomas Schinecker is waiting in the wings to assume the company's top leadership spot. The change in leadership is set for March 2023. Schinecker is currently CEO of the company's diagnostics division, a role he has held since 2019. He has spent nearly two decades at Roche, holding multiple leadership positions, including global head of the diagnostics division's centralized and point-of-care solutions business.
Schwan, who has been Roche CEO since 2014 and with the company since 1993, called Schinecker "a highly qualified successor" who has been a key member of the company's leadership team and has built its diagnostics division into a global powerhouse.
"Thomas successfully set up our Diagnostics Division for the future. Under his leadership our Diagnostics organization also made considerable contributions in fighting the COVID-19 pandemic," Schwan said.
Under Schinecker's leadership, the company's diagnostics business grew significantly due to its COVID-19 test kits, including PCD-test kits that Roche gained from its acquisition of long-term partner, TIB Molbiol of Germany. Roche said the acquisition will enable the company to expand its diagnostic portfolio with capabilities to identify existing pathogens and those that may become a global threat in the future. Under his guidance, Roche also snapped up GenMark Diagnostics, one of the first companies to receive regulatory clearance for a COVID-19 test. Those deals bolstered Roche's COVID-19 tests, including the Elecsys IL-6 test, which measures levels of IL-6 (interleukin-6), as well as its Elecsys Anti-SARS-CoV-2 antibody test.
Schinecker said he was honored by the board's decision to name him as Schwan's successor.
"I am delighted to carry on working closely with Roche colleagues and the corporate executive committee. Like we've done for the last 125 years, I am excited about the future innovations we will bring to patients around the globe," Schinecker said in a statement.
Schwan has spent his entire career with Roche. Under his guidance, the company has become a powerhouse in oncology and specialty drug areas. He told The Financial Times that the company's long-term strategy is not expected to change with Schinecker at the helm. Part of that strategy included the acquisition of the one-third stake that rival pharma company Novartis held in Roche. Last year, Roche purchased that stake for $20.7 billion in order to gain full strategic flexibility.
"The strategy as it stands will continue. And of course, we want to evolve both our businesses, pharma and diagnostics," Schwan told the Times. "I don't see any structural or other changes on a strategic level with the appointment of Thomas Schinecker."
Schwan also said he was honored to be asked to take over as chairman and pledged to continue to devote all of his efforts to Roche's future.
As Schwan prepares to take on the role of chairman of the board of directors, he will replace the outgoing Franz, who decided against seeking re-election to the position. Franz has served as chairman since 2014 and has been on the board since 2011. During his time on the board, Franz said the company has "achieved many important milestones" but now was the right time for a leadership change.
"I am proud of the significant contributions Roche has made in fighting the pandemic during the last two and a half years. I am also pleased that we could secure long term stability in our shareholder structure with the repurchase of Roche shares from Novartis," Franz said in a statement. "With the strong pipelines of innovative products in both our Pharma and Diagnostic businesses, we are set for continued growth in the future."
Roche Ends 5 Trials, but Insists Outlook Looks Bright
Roche released its financial results from the first half of 2022 Thursday morning. Overall, its financial outlook remains bright, despite the effects of the waning COVID-19 pandemic and an increase in biosimilars.
The company said it expects sales of both COVID-19 medicines and diagnostics to decrease by approximately $2 billion to $5 billion. It also expects biosimilars to decrease sales by about $2.5 billion for the year.
Despite this, Schwan said on the conference call that the company has seen "good, solid growth" in overall sales. This is largely due to a 5% increase in sales, totaling $32.3 billion.
“We achieved good results in the first half of the year, thanks to the continued strong demand for our diagnostics base business and our new medicines to treat haemophilia, cancer and neurological disorders. Thanks to the ongoing renewal of our portfolio, we continue to grow despite biosimilars, whose impact declined further as expected," Schwan said.
During the call, Roche announced it has stopped five different clinical trials. These include the Akt kinase inhibitor ipatasertib (RG7440) in two separate trials, one studying its effects in prostate cancer and the other in solid tumors and castration-resistant prostate cancer (CRPC).
It also cut G6338 for metabolic disease, RG6173, an anti-tryptase for asthma, and giredestrant, which was in a Phase II trial for breast cancer.
In spite of these cuts, Schwan's positive outlook is largely due to the company's accomplishments so far this year. These include EU approvals of Polivy (first-line treatment for an aggressive form of blood cancer), Lunsumio (follicular lymphoma) and Tecentriq (early-stage lung cancer); an EU marketing authorization application submitted for glofitamab (blood cancer); US approval of Evrysdi (babies under two months of age with spinal muscular atrophy) and US priority review for Lunsumio, according to the report.
Roche also touted its launch of "innovative platforms and systems for tissue-based cancer diagnostics, of HPV self-sampling solution and monkeypox virus test kits," as markers of its success, and expects these platforms to continue to develop as the year unfolds.