Sanofi Delivers 2018 Business EPS Growth of 5.1 Percent at CER

Fourth-quarter sales growth driven by Specialty Care and Vaccines

  • Net sales were €8,997 million, an increase of 3.5 percent on a reported basis, 3.9 percent at CER and 2.6 percent at CER/CS.
  • Sanofi Genzyme sales were up 37.4 percent (16.1 percent at CER/CS), led by Immunology and Rare Blood Disorder franchises.
  • Vaccines sales increased 9.7 percent, driven by successful influenza differentiation strategy and Menactra.
  • CHC sales increased 1.9 percent, supported by Emerging Markets.
  • DCV GBU sales were down 11.3 percent; Global Diabetes franchise sales declined 10.5 percent in line with 2015-2018 guidance.
  • Emerging Markets sales were up 6.0 percent, reflecting strong performance in Asia.

Full-Year 2018 sales growth from new products and Emerging markets more than offset impact of U.S. LoEs

  • Net sales in 2018 were €34,463 million, down 1.7 percent on a reported basis and grew 2.5 percent at CER (up 0.6 percent at CER/CS).
  • Sanofi Genzyme grew 30.8 percent (+14.2 percent at CER/CS) to €7,226 million.
  • Vaccines sales increased 2.4 percent to €5,118 million while CHC sales were up 3.0 percent to €4660 million.
  • DCV GBU sales declined 13.8 percent to €4,511 million.
  • Emerging Markets sales were up 7.5 percent, supported by strong performance in China (up 12.7 percent).

Sanofi delivers 2018 business EPS at the high end of its guidance range

  • Q4 2018 business EPS up 4.7 percent at CER to €1.10.
  • Full-Year 2018 business EPS of €5.47 up 5.1 percent at CER and IFRS EPS of €3.45 (down 48.5 percent).
  • Board proposes dividend of €3.07, the 25th consecutive increase in dividend.

Key achievements in sustaining innovation in R&D

  • Isatuximab met primary endpoint of ICARIA phase 3 study in Relapsed/Refractory Multiple Myeloma.
  • BIVV001 demonstrated sustained high factor levels at once-weekly dosing with data presented at ASH.
  • FDA Priority Review granted for Dupixent in adolescents with moderate-to-severe atopic dermatitis.
  • R&D strategy evolves towards prioritization of Specialty Care and Vaccines, leveraging technology platforms and data science.

2019 financial outlook

Sanofi expects 2019 business EPS to grow between 3 percent and 5 percent at CER, barring unforeseen major adverse events. Applying average January 2019 exchange rates, the positive currency impact on 2019 business EPS is estimated to be between 1 percent to 2 percent.

Sanofi Chief Executive Officer, Olivier Brandicourt, commented: “In the fourth quarter, we continued the momentum of the previous quarter and we delivered 5 percent full-year business EPS growth, at the high end of our guidance. In 2018, we executed on important launches including Dupixent, Libtayo and Cablivi, as the headwinds from our U.S. LoEs began to moderate. Additionally, the acquisitions of Bioverativ and Ablynx provided the foundation to build a leading Rare Blood Disorder franchise and to enhance our biologic discovery capabilities. As we enter 2019, our focus remains on delivering our business priorities and transforming Sanofi to address the evolving business dynamics facing our industry.”

R&D update

Consult Appendix 6 for full overview of Sanofi’s R&D pipeline

R&D strategy

Sanofi is today providing an update on the evolution of its R&D strategy. Consistent with its ambition to be an industry innovation leader, Sanofi has increased its R&D focus on Specialty Care therapy areas (Oncology, Immunology, Rare Disease and Rare Blood Disorder) while maintaining its commitment to Vaccines. Since 2017, the number of R&D programs in these areas has increased significantly, and they now represent over 90 percent of Sanofi’s clinical portfolio. This change reflects advances in the Company’s R&D capabilities and understanding of human biology.

In support of this strategy, Sanofi recently carried out a rigorous pipeline prioritization review to accelerate investment behind its most promising programs and to discontinue those with a less attractive expected return profile. As a result, the Company is accelerating the development of 17 programs, including 8 in Oncology. Thirteen development projects and 25 research projects are being discontinued to enhance the company’s focus on delivering first and best in class medicines. Overall, Sanofi could potentially submit 9 new medicines and 25 additional indications to regulatory authorities over 2019 to 2022.

Through the development of its own expertise and the establishment of partnerships with industry pioneers, Sanofi has access to a broad range of therapeutic modalities that enable a more customized, science-driven approach to targeting disease. This includes development of next-generation biologics, such as multi-specific antibodies and Nanobodies, which provide new opportunities relative to traditional monoclonal antibodies in areas such as oncology and immunology, as well as gene therapies. The Company is also employing data science and machine learning across the R&D organization to generate higher quality data, accelerate development and regulatory submissions, and reduce costs.  Sanofi expects to maintain an annual R&D budget of approximately €6 billion through 2021.

Regulatory update

Regulatory updates since October 31, 2018 include the following:

  • In February, the European Medicine Agency’s Committee for Medicinal Products for Human Use (CHMP) has recommended approval of Praluent (collaboration with Regeneron) in European Union to reduce cardiovascular risk in people with established atherosclerotic cardiovascular disease.
  • In December, the FDA approved the hexavalent vaccine, Vaxelis, for use in children from 6 weeks through 4 years of age. Vaxelis was developed as part of a joint partnership between Sanofi and Merck in the U.S. and Canada. Commercial supply will not be available in the U.S. prior to 2020.
  • In December, Dupixent (collaboration with Regeneron) was submitted to the FDA for the treatment of adults with inadequately-controlled chronic rhinosinusitis with nasal polyps (CRSwNP).
  • In December, the European Commission granted marketing authorization for Dengvaxiato prevent dengue disease in individuals 9-45 years of age with a documented prior dengue infection and who are living in endemic areas.
  • In November, the CHMP recommended approval in European Union of fexinidazole the first all-oral treatment for sleeping sickness.
  • In November, the FDA accepted for Priority Review the supplemental Biologics License Application (sBLA) for Dupixentin adolescent patients 12 to 17 years of age with moderate-to-severe atopic dermatitis, whose disease is inadequately controlled with topical therapies or for whom topical treatment is medically inadvisable. The target action data for the FDA decision is March 11, 2019.
  • At the beginning of February 2019, the R&D pipeline contained 81 projects including 33 new molecular entities in clinical development. 35 projects are in phase 3 or have been submitted to the regulatory authorities for approval.

Portfolio update

Phase 3:

  • In February, Sanofi announced that Isatuximab phase 3 trial (ICARIA study) met primary endpoint of prolonging progression free survival in patients with relapsed/refractory multiple myeloma
  • In January, the New England Journal of Medicine (NEJM) published positive results of the Phase 3 trial of Cablivi (caplacizumab) in adults with acquired thrombotic thrombocytopenic purpura (aTTP).
  • In November, new analyses on mortality from the ODYSSEY OUTCOMES trial evaluating Praluentwere presented at the American Heart Association (AHA) Scientific Sessions. In November, the New England Journal of Medicine (NEJM) also published detailed results of this trial.
  • Shan 6, a pediatric hexavalent vaccine, entered phase 3.

Phase 2:

  • A phase 2 study evaluating the combination of isatuximab (anti-CD38 mAb) and cemiplimab (collaboration with Regeneron) in lymphoma was intitiated.
  • A phase 2 study evaluating the combination of isatuximaband atezolizumab (PD-L1 inhibitor mAb) in solid tumors was initiated.
  • A phase 2 study evaluating SAR440340(an anti-IL33 mAb, collaboration with Regeneron) in atopic dermatitis was initiated.
  • Positive primary analysis of the Phase 2b trial demonstrated the safety and efficacy of SP0232/MEDI8897 (anti RSV mAb – Respiratory Syncytial Virus, collaboration with Medimmune).
  • Several projects in phase 2 were stopped:
  • GZ389988, a TRKA antagonist, in osteo arthritis;
  • ALX0171, an anti RSV nanobody (from Ablynx) for Respiratory Syncitial Virus;
  • SAR425899, a GLP-1 / GCGR agonist, in obesity in type 2 diabetes patients;
  • SAR407899, a rho kinase inhibitor, for microvascular angina;

Phase 1:

  • SAR408701, an anti-CEACAM5, achieved positive proof of concept in a subgroup of lung cancer patients. A broad development program is expected to start by the end of 2019.
  • BIVV001, a recombinant Factor VIII for Hemophilia A, achieved positive proof of concept with demonstration of sustained high factor levels at once-weekly dosing.
  • SAR441000,a cytokine mRNA (collaboration with BioNTech AG) entered phase 1 in the treatment of melanoma.
  • SAR443060/DNL747 (collaboration with Denali), an oral brain-penetrant small molecule (RIPK1 inhibitor), entered phase 1 clinical study in Amyotrophic Lateral Sclerosis (ALS) and Alzheimer’s disease.
  • BIVV003, a Zinc Finger Nuclease (ZFN) gene editing technology issued from Bioverativ entered phase 1 in the treatment of sickle cell disease.
  • SAR441344, an anti-CD40L mAb (license from ImmuNext), entered phase 1 in the treatment of multiple sclerosis.
  • A next generation Pneumococcal Conjugate Vaccine(PCV) entered phase 1.

Several projects in phase 1 were stopped:

  • SAR439794, a TLR4 agonist immunomodulatory evaluated in peanut allergy;
  • SAR247799, a S1P1 agonist evaluated in cardiovascular area;
  • SAR438335, a GLP-1/GIP agonist in Type 2 diabetes;
  • SAR228810, an anti protofibrillar AB mAb for Alzheimer disease;
  • UshStat, a myosin 7A gene therapy for Usher Syndrome 1B, will be discontinued contigent upon identification of out-licensing partner.

Collaborations

  • In January 2019, Sanofi and Regeneron announced a restructuring of their global Immuno-Oncology Discovery and Development Agreement for new IO cancer treatments. The 2015 agreement was scheduled to end in approximately mid-2020. This revision provides for ongoing collaborative development of two clinical-stage bispecific antibody programs (BCMAxCD3 and MUC16xCD3 bispecific). It also provides Sanofi with increased flexibility to advance its early-stage IO pipeline independently while Regeneron retains all rights to its other IO discovery and development programs.
  • In January 2019, BioNTech announced that it has extended its research collaboration with Sanofi initiated in late 2015 in the field of mRNA cancer immunotherapy.
  • In January 2019, MyoKardia,announced that it regained worldwide rights to all programs covered under its license and collaboration agreement with Sanofi. The collaboration has not been extended beyond the initial research term, which ended on December 31, 2018. As a result, MyoKardia now has regained global rights to all programs in its portfolio, including mavacamten (a Myosin inhibitor evaluated in obstructive and non-obstructive hypertrophic cardiomyopathy) and MYK-491 (a Myosin activator evaluated in dilated cardiomyopathy) and the license and collaboration will conclude in its entirety effective April 1, 2019.
  • In December Sanofi and Medicines for Malaria Ventures(MMV) agreed to transfer the operational responsibility for the development of Ferroquine/OZ439, to MMV in such a way that MMV would assume leadership while Sanofi remains the sponsor of the studies, fulfilling drug supply, regulatory and legal obligations. Ferroquine/OZ439 is a first in class combination for malaria previously developed in collaboration with MMV.
  • In November, Sanofi announced that it plans to collaborate with Denali Therapeutics Inc. on the development of multiple molecules with the potential to treat a range of neurological and systemic inflammatory diseases. – Medical Buyer Bureau

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