However, drug sales growth in the fourth quarter slowed and the strong contribution made by cancer treatments from US biotech division Genentech was offset by a weaker fourth quarter from Roche's own in-house products, notably Tamiflu.
Roche Chairman and CEO Franz Humer said the slowdown was a one-off.
"The fourth-quarter growth in pharmaceuticals is a reflection that (in 2003) there was a flu epidemic in December," he told reporters. "The slower growth in fourth-quarter pharmaceutical sales is not a trend to be taken forward."
Humer added he expected an increase in 2005 net income but said it was too early to give a detailed forecast.
Roche stock fell 2.5 percent to 124 Swiss francs by 0920 GMT as the full-year numbers missed expectations, with core net profit rising 41 percent to 4.34 billion Swiss francs - below a forecast of around 4.77 billion.
The figure refers to net profit from continuing business and after exceptional items.
"This stock is the most expensive in the European big-cap pharma area and it is not expected to disappoint, so these numbers are obviously going to hit the shares today," said Max Herrmann, pharmaceuticals analyst with ING Financial Markets in London.
The stock is on a downtrend this year after setting a 2004 high of more than 141 francs in April.
Roche said full-year group sales rose 12 percent - in local currencies - to 29.52 billion francs, while prescription drug sales were up 13 percent at 21.70 billion francs.
Analysts polled by Reuters had on average expected group sales of 30.18 billion francs and drug sales of 22.14 billion.
TOUGH COMPARISON: However, due to a tough comparison period in 2003, when both Tamiflu and hepatitis drug Pegasys sold well, sales growth in the core pharmaceutical division slowed to just 5 percent in the fourth quarter from 17 percent in the third.
Net profit figures were skewed by a one-off gain from a bond conversion and the proceeds from the sale of Roche's over-the-counter drugs business.
Overall group net income - which includes the OTC business and an exceptional pretax gain of some 908 million francs from the conversion of a bond - more than doubled to 6.6 billion.
The Basel-based firm reiterated it expected operating margins at its pharma division in 2005 to be broadly in line with 2004's level of 25.7 percent, despite rising launch and development costs and the effects of patent expiries on a key drug.