Roche VRP aims to revive share price with research successes
Published: Tuesday, Mar 12th 2024, 14:10
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This is Severin Schwan's first Roche Annual General Meeting in his new position as Chairman of the Board of Directors. In his address, he immediately touched on one of the most troublesome topics at the moment: The weakening profit participation certificates.
With a drop of almost 16%, they were already the red lantern among the blue chips in 2023 and are now clearly lagging behind the market as a whole in the year to date. For Schwan, there are two reasons for the weak performance.
On the one hand, the end of the coronavirus pandemic also led to a very significant decline in Roche's Covid business. "As with other companies that launched Covid-19 products on the market, the share price initially benefited disproportionately and reached record highs by the beginning of 2022." Roche was then also disproportionately affected by the abrupt end of the pandemic.
Research setbacks are a burden
According to Schwan, the second negative factor is several setbacks in late-stage drug development. "The constant renewal of our portfolio is of crucial importance for Roche's long-term development." It is therefore important to convince the market again of Roche's continuous and therefore sustainable innovative strength with corresponding successes - also in comparison to competitors.
"I am convinced that these successes will come," he said. The pharmaceutical company has a broad product pipeline. And even if not all active ingredients are likely to be successful, it takes courage to take such calculated risks.
However, experience also shows that the success of innovation cannot always be precisely programmed in terms of time. "In our industry, changes need time to take full effect."
Another point raised by the Chairman of the Board of Directors at the Annual General Meeting was the topic of Switzerland as a location for innovation. Although Switzerland is still well positioned, he is concerned "when, for example, ETH Zurich's funding is reduced or it is still denied access to 'Horizon Europe', the world's largest funding program for research and development."
Approval for all applications
Meanwhile, the shareholders approved all of the Board of Directors' proposals. The 635 shareholders present represented 77.02% of the share capital. They approved the annual financial statements and the consolidated financial statements for 2023, the remuneration report and the sustainability report. They also approved the total amount of bonuses for the Group Executive Board and the Chairman of the Board of Directors as well as the future remuneration of the Group Executive Board and the Board of Directors.
The 37th dividend increase to CHF 9.60 was also approved by the shareholders.
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