Sanofi retains full-year outlook despite drop in third-quarter profit

Headline results for the third quarter:

Prescription drug sales

€6.4 billion ($7.1 billion)

+3.6%

Overall revenue

€9.5 billion ($10.6 billion)

+1.1%

Profit

€1.8 billion ($2 billion)

-22.3%

Note: All changes are versus the prior-year period unless otherwise stated

What the company said:

"Since joining Sanofi only two months ago, I am increasingly excited about the strength of our businesses," remarked CEO Paul Hudson, who was named as Olivier Brandicourt's successor in June. "Building on this foundation, Sanofi delivered a resilient underlying performance in the third quarter with strong sales in specialty care, largely driven by the continued outstanding performance of Dupixent," Hudson added.

Other results:

  • Genzyme unit: €2.7 billion ($3 billion), up 22.9%, driven by continued "strong uptake" of Dupixent
    • Dupixent: €570 million ($636 million), up 153.3%, with US sales rising 130% on a constant currency basis to €455 million ($507 million) and revenue in Europe climbing 170% on the same basis to €54 million ($60 million)
    • Eloctate: €162 million ($181 million), down 16.1%, with US sales dropping 23.5% on a constant currency basis to €122 million ($136 million) as a result of ongoing competitive pressure
  • Diabetes unit: €1.3 billion ($1.5 billion), down 8.3%, due to the increased contribution to the coverage gap related to Medicare Part D and a continued decline in average US glargine net prices
    • Lantus: €751 million ($839 million), down 17.5%, hit by lower average net prices in the US and biosimilar competition in Europe
    • Toujeo: €218 million ($243 million), flat versus prior year
  • Aubagio: €494 million ($552 million), up 16%, driven by the performance in the US and Europe
  • Praluent: €61 million ($68 million), down 10.3%, mainly due to lower sales in the US, which were impacted by significantly higher rebates
  • Vaccines division: €1.9 billion ($2.1 billion), down 6.8%, reflecting anticipated weighting of US influenza vaccines supply towards the fourth quarter
  • Emerging markets: €2.8 billion ($3.1 billion), up 9.7% on a constant currency basis, due to "strong" performance in most regions

Looking ahead:

Sanofi continues to expect business earnings per share to grow approximately 5% on a constant currency basis, while the currency impact is estimated to be around 3%, revised from an earlier prediction of between 1% and 2%.

Meanwhile, chief financial officer Jean-Baptiste de Chatillon suggested that the company expects more invoices to translate into sales in the fourth quarter. "We started manufacturing flu products late in the season. It is really about balance between the third and the fourth quarter," he said.

Pipeline updates:

Sanofi disclosed that Phase II studies investigating the combination of cemiplimab and isatuximab in non-small-cell lung cancer and prostate cancer were discontinued during the quarter due to efficacy considerations. The company added that early-stage development of the trigonal GLP1R/GIPR/GCGR agonist SAR441255 for diabetes and obesity was also ended.

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