Roche Holding AG (ROG.VX) Wednesday said it received European Union approval to sell its rheumatoid arthritis drug RoActemra, underlining the Swiss drugmaker's strong position in a sector suffering from lack of innovation and the loss on patents of big money-earners.

Roche, based in Basel, said the biological drug, which takes a new approach to treat the disease, will be sold in combination with an older pill to patients who failed to respond to existing therapies.

RoActemra, known as Actemra in the U.S., is Roche's most important new drug launch this year.

In December, the company was dealt a big setback on Actemra, when the U.S. Food and Drug Administration asked for a new animal trial and other information, which will delay its launch by at least 18 months.

Many analysts see Actemra reaching peak annual sales of around $2 billion. A few see even higher results.

Actemra was developed by Japan's Chugai Pharmaceutical Co. (4519.TO), which is controlled by Roche, and Roche owns the rights to sell Actemra outside Japan.

There are already many treatments for rheumatoid arthritis, including Rituxan/MabThera, which is sold by Roche and its U.S. ally Genentech Inc. (DNA). But many of these drugs merely relieve pain - in some cases with severe long-term side effects, including osteoporosis and high blood pressure.

Actemra works by a different mechanism than older drugs. It is a humanized monoclonal antibody - an antibody produced by a single cell - and the first to inhibit the interleukin-6, or IL-6, receptor. IL-6 is considered an important mediator of the acute inflammatory response that underpins the rheumatoid arthritis disease process.

At 0830 GMT, Roche shares were up CHF1.50, or 0.9%, at CHF171.80, in a lower Swiss market and also outperforming the broader European healthcaer sector. Roche shares have dropped 16% over the past year, in line with the European drugs sector.

Roche, the world's seventh-largest pharmaceutical company by sales, focuses on prescription drugs. Its most successful franchise is cancer drugs, which made up nearly half of its total sales last year.

Novartis AG (NVS) holds 33% of Roche shares.

Company Web Site: http://www.roche.com

-By Anita Greil, Dow Jones Newswires; +41 43 443 8044 ; anita.greil@dowjones.com

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