Sanofi to continue with cost-cutting as new drugs show promise
Sanofi is to push on with cost-cutting after reaching a target of 1.5 billion euros a year ahead of expectations, amid mounting sales for new drugs.
Reuters reported that the French pharma could return to growth in the second half of this year after years of pain caused by declining revenue from its diabetes business.
The firm has also made acquisitions that could further boost revenues, after successes with new drugs from a partnership with Regeneron.
Sanofi CEO Olivier Brandicourt told a Bank of America Merrill Lynch conference in London on Friday: “It’s only the beginning, and we will continue to be very efficient.”
The company last week unveiled a reorganisation of its business, as well as swapping top executives with Germany’s Bayer.
Stefan Oelrich is leaving his role as Sanofi’s head of diabetes to become head of Bayer’s pharma division.
Meanwhile Dieter Weinand has joined to become head of Sanofi’s primary care global business unit, combining the diabetes and cardiovascular units with established products, currently part of the general medicines and emerging markets unit.
Sanofi is creating a second new global business unit called China and Emerging Markets, focusing on business and growth opportunities in China.
Referring to the reorganisation Brandicourt said: “In the developed world we are moving from five business units to four, and that’s going to be very helpful in addition to generating synergies and savings.”
While sales of its blockbuster insulin Lantus have fallen away, Sanofi’s new eczema drug is selling well, and could be further boosted by a potential new indication in asthma.
The FDA is reviewing Dupixent in this other indication and is set to make a decision by the end of the year.
Rheumatoid arthritis drug Kevzara, which like Dupixent was developed with partner Regeneron, has also got off to a strong start, Brandicourt said.
“We are very satisfied with the way Dupixent has been launched and continues to exceed expectations. Kevzara is also actually competing very effectively and gaining market share and if you combine the two at our last quarter we are not far from annualizing now at blockbuster levels,” said Brandicourt.
Sales of Dupixent were around 176 million euros in the second quarter, while Kevzara produced revenues of 20 million euros.
Sanofi has also bought US haemophilia specialist Bioverativ for $11.6 billion, and Belgium’s Ablynx and its experimental rare blood disorder drug for 3.9 billion euros this year.
The integration is “going well,” Brandicourt said, who added there is another 6-7 billion euros available for smaller acquisitions to strengthen the company’s position.
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