Roche reported top-line results for the first quarter of 2010 which were in line with our expectations, and we're maintaining our CHF 219 fair value estimate. Total sales grew 6% as reported (9% at constant currencies) to reach CHF 12.2 billion, strengthened by sales of its cancer drug portfolio as well as sales in emerging markets. Reported sales of Avastin grew 12% overall (18% at constant currencies) to reach almost CHF 1.7 billion. This includes 24% growth in the international segment (outside of the US, Western Europe and Japan), and we think international growth should be bolstered by Avastin's recent approval in China. Roche reported CHF 517 million in sales of influenza drug Tamiflu, up 29% from CHF 401 million in the first quarter of 2009. While Tamiflu sales were still a boost to Roche's top-line performance in the most recent quarter, we expect comparisons to deteriorate in the remainder of the year as government stockpiling dwindles.
We continue to think that Roche will be able to generate top-line growth of roughly 2% in 2010, or 6% excluding Tamiflu--consistent with the firm's mid-single-digit forecast. Turning to the pipeline, we're eager to see Avastin data in ovarian cancer (to be released at the annual meeting of the American Society of Clinical Oncology in June), and we're encouraged by Roche's decision to file for approval of T-DM1--which is comprised of the antibody in Herceptin with a chemotherapy drug attached--in 2010. We're also bullish on the potential of three novel drugs which could enter Phase III of development in 2010 in the fields of diabetes, hepatitis C, and multiple sclerosis.