Sanofi Sa · EURONEXT:SAN
Sanofi Sa — Q1 2020 Earnings Presentation
46 slides from Sanofi Sa's earnings presentation, Apr 24, 2020
Slide 1: Q1 2020 Results
Q1 2020 Results Play to Win April 24, 2020
Slide 2: Forward looking statements
Forward looking statements This presentation contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements are statements that are not historical facts. These statements include projections and estimates and their under
Slide 3: Agenda
Agenda Business update Paul Hudson Chief Executive Officer Dupixent® update Bill Sibold EVP, Specialty Care – Sanofi Genzyme Financial update Jean-Baptiste de Chatillon EVP, Chief Financial Officer Conclusion Paul Hudson Chief Executive Officer Q&A session 3
Slide 4: Business update
Business update Paul Hudson Chief Executive Officer
Slide 5: Sanofi acts on COVID-19
Sanofi acts on COVID-19 100% of manufacturing Business continuity Keeping employees sites operational secured safe • Maintaining production and • Continuous access to medicines • 20,000 employees working supply to avoid shortages essential to patients’ needs every day in all industrial sites • Diver
Slide 6: Sanofi takes on responsibility to fight COVID-19
Sanofi takes on responsibility to fight COVID-19 by investigating therapies for patients now and… Anti-inflammatory Anti-viral OTC Diagnostic hydroxychloroquine Smartphone-based (Plaquenil®) self-testing solution • Global trials ongoing • Studies initiated and • Rapid diagnostic test to detect suppo
Slide 7: Developing two complementary vaccine approaches
…developing two complementary vaccine approaches with unparalleled pandemic capacity 1 2 Baculovirus mRNA Platform recombinant + vaccine vaccine approach approach Protein Adjuvant mRNA Lipid Antigen nanoparticle • Licensed recombinant platform(1) • Innovative approach(2) • Existing large scale capac
Slide 8: Q1 driven by Dupixent and COVID-19 impact
Q1 driven by Dupixent® and COVID-19 impact Sales and EPS growth Dupixent® sales strong Efficiencies realized Opex evolution Company Sales +6.6% €776m +0.7%(1) Q1 2020 €8,973m Q1 2019 €8,391m +130% €329m Business EPS +15.6% -2.9% Q1 2020 €1.63 Q1 2019 €1.41 Q1 2019 Q1 2020 Q1 2019 Q1 2020 All growth
Slide 9: New GBU structure – delivered in Q1
New GBU structure – delivered in Q1 Q1 2020 sales of €9.0bn up 6.6% at CER Specialty Care General Medicines Vaccines Consumer Healthcare €2.7bn €4.1bn €0.9bn €1.3bn +31.3% -3.8% +3.7% +4.2% Dupixent® Diabetes Polio / Pertussis / Hib Allergy, Cough & Cold MS / Neurology / Other I&I Cardiovascular and
Slide 10: Specialty Care – up 31% with growth across franchises
Specialty Care – up 31% with growth across franchises Q1 2020 sales growth by franchise • Dupixent® strong demand globally • Quarterly sales continued to double 3 years after launch Dupixent® +130% • Sarclisa® U.S. launch ahead of COVID-19 crisis Oncology +29% • Aubagio® (+21%) due to demand & inven
Slide 11: Dupixent update
Dupixent® update Bill Sibold EVP, Specialty Care – Sanofi Genzyme
Slide 12: Dupixent – key growth driver in Q1
Dupixent® – key growth driver in Q1 Global Dupixent® quarterly sales (€m) • Strong Q1 performance in AD, asthma and CRSwNP • U.S. sequential TRx +19% versus sales growth of +12%(1) 776 reflects higher co-pay assistance 679 Ex-U.S. 163 (+156%) • Ex-U.S. contributed 21% of sales 570 134 496 115 • Mile
Slide 13: Dupixent – pediatric data supports best-in-class profile
Dupixent® – pediatric data supports best-in-class profile Approximately 3x as many children aged 6-11 years achieved skin clearance and reduction in itch with Dupixent® and TCS compared to TCS alone IGA score of 0 or 1 >3-point improvement in peak pruritus NRS % of patients(1) % of patients(1) ~3x ~
Slide 14: Dupixent – HCPs continue to initiate and maintain patients during COVID-19
Dupixent® – HCPs continue to initiate and maintain patients on therapy during COVID-19 Impact on prescribing for moderate-to-severe AD(1) Percent of HCPs initiating Percent of HCPs continuing patients on treatment patients on treatment • Type 2 pathway is not involved in viral defense 72% 85% • Sele
Slide 15: Dupixent – resilient U.S. TRx trend during COVID-19 crisis
Dupixent® – resilient U.S. TRx trend during COVID-19 crisis U.S. weekly TRx(1) stable • Patients are being maintained on Dupixent® 25,000 • At-home administration with no requirement for ongoing lab monitoring • ~80% of dermatologists are extremely comfortable continuing patients on Dupixent® via te
Slide 16: Business update
Business update Paul Hudson Chief Executive Officer
Slide 17: General Medicines – favorable phasing due to COVID-19
General Medicines – favorable phasing due to COVID-19 Q1 2020 General Medicines sales • General Medicines down -3.8% to €4,069m • Resilient performance of chronic therapies €4,239m €4,069m -3.8% • Diabetes sales €1.3bn, -1.2%; COVID tailwinds in Europe €1,282m Diabetes • Established Products ex-Chin
Slide 18: China – volume growth confirms VBP bidding strategy
China – volume growth confirms VBP bidding strategy China Plavix® & CoAprovel® strong volume uptake • China Q1 sales of €680m, down -14% (millions of boxes) • VBP product sales: Plavix® -54%, Aprovel® family -33% • Volume growth of >60%(1) on track with guidance for 2020 +69% • COVID-19 impact +23%
Slide 19: Vaccines – solid growth despite high base in Q1
Vaccines – solid growth despite high base in Q1 Q1 2020 Vaccines sales by franchise • Vaccines growth of +3.7% to €909m €909m • PPH -0.8% due to phasing in Japan in Q1 2019 • Offsetting dynamics of COVID-19 in Q1 +€32m +€25m • Flu up +100% driven by global demand; late U.S. season -€21m • Travel vac
Slide 20: CHC – consumer stocking offset anticipated headwinds
CHC – consumer stocking offset anticipated headwinds Q1 2020 CHC sales by category • CHC grew +4.2% to €1.3bn in Q1 • ‘Pantry loading’ drove incremental sales €158m • Pain and Allergy, Cough & Cold categories benefitted +0.6% Other mainly outside the U.S. from COVID-19 Allergy, €154m €398m Cough & •
Slide 21: Financial update
Financial update Jean-Baptiste de Chatillon EVP, Chief Financial Officer
Slide 22: BOI margin up 220bps in Q1, around half due to COVID-19
BOI margin up 220bps in Q1, around half due to COVID-19 €m Q1 2020 Q1 2019 % Change (CER) Net Sales 8,973 8,391 +6.6% Other revenues 343 322 +3.4% Gross Profit 6,469 6,098 +5.5% Gross margin % 72.1% 72.7% R&D (1,340) (1,385) -4.3% SG&A (2,342) (2,376) -2.1% Other current operating income & expenses
Slide 23: China VBP lowered GM; Opex reduction on track
China VBP lowered GM; Opex reduction on track Gross margin ratio(1) Operating expenses 72.7% 72.1%(2) €3,761m €3,682m -2.9% €1,385m €1,340m 71.7% -4.3% at CER R&D €2,376m €2,342m SG&A -2.1% at CER Q1 2019 Q1 2020 Q1 2019 Q1 2020 All growth at CER; GM: gross margin (1) Gross Margin is calculated as t
Slide 24: Favorable FCF phasing in Q1
Favorable FCF phasing in Q1 Free Cash Flow(1) evolution +108% €1.6bn Long-term FCF drivers ~€500m phasing benefit • Grow net sales • Lower tax payments • • Improve working capital €0.7bn €0.8bn Proceeds from divestitures • Prioritize investments • Expand margin Q1 2018 Q1 2019 Q1 2020 On track to im
Slide 25: Expected business dynamics in Q2 2020 due to COVID-19
Expected business dynamics in Q2 2020 due to COVID-19 Company sales Low single-digit decline Pharmaceuticals Reduction of in-channel inventory build Travel vaccines and immunizations negatively impacted while China Vaccines recovery and flu demand expected to continue Consumer Healthcare Consumer st
Slide 26: FY 2020 business EPS guidance affirmed
FY 2020 business EPS guidance affirmed Business EPS Around +5% at CER(1,2) FX impact Approximately -1% to -2%(3) on business EPS based on April 2020 average exchange rates (1) Compared to FY2019 and barring major unforeseen adverse events (2) Base for FY 2019 Business EPS growth is €5.97 reflecting
Slide 27: Conclusion
Conclusion Paul Hudson Chief Executive Officer
Slide 28: Sanofi expected to emerge strongly from pandemic crisis
Sanofi expected to emerge strongly from pandemic crisis Portfolio has unique strengths to deliver on patient needs Specialty Care General Medicines Vaccines Consumer Healthcare • Dupixent® not an • Chronic disease • EflueldaTM(1) HD QIV • Strong Allergy, immunosuppressant treatments initial approval
Slide 29: Brain penetrant BTKi ('168) targets best-in-class profile
Brain penetrant BTKi ('168) targets best-in-class profile Safety Similar to placebo Low treatment Oral once-daily, no monitoring burden Relapse rate In line with anti-CD20 reduction Slowing disability Only BTKi with demonstrated CNS penetration and in RMS engagement of potential markers of disabilit
Slide 30: Pipeline momentum continues into Q2 2020
Pipeline momentum continues into Q2 2020 BTKi (‘168)(2) Phase 2 results presented in Relapsing Multiple Sclerosis Recent news flow Dupixent®(3) Phase 3 results presented in Atopic Dermatitis for 6-11 year-old age group Sarclisa® U.S. FDA approval and positive CHMP opinion with Pd(4) for RRMM Dupixen
Slide 31: Q&A session
Q&A session Paul Hudson Jean-Baptiste de Chatillon Chief Executive Officer EVP, Chief Financial Officer Olivier Charmeil Karen Linehan EVP, General Medicines EVP, Legal Affairs and General Counsel David Loew Alan Main EVP, Vaccines – Sanofi Pasteur EVP, Consumer Healthcare John Reed Bill Sibold EVP,
Slide 32: Financial appendices
Financial appendices Q1 2020 Results April 24, 2020
Slide 33: Q1 sales benefitted from strengthening U.S. dollar
Q1 sales benefitted from strengthening U.S. dollar Currency impact Company sales(1) Business EPS +€26m +€0.00 +0.3% +0.0% Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 2019 2020 2019 2020 (1) Main currency impact on Company Sales in Q1 2020: US Dollar (+€89m), Argentine Peso (-€31m), Japanese Yen (+€19m), Brazilian
Slide 34: Net debt evolution in Q1 2020
Net debt evolution in Q1 2020(1) €397m €2,245m €1,558m €16,191m €15,107m (2) (3) (4) Net Debt (5)(6) Free Cash Flow Acquisitions & Licences Other Net Debt December 31, 2019 March 31, 2020(5) (1) Credit ratings reaffirmed: Moody’s A1/stable, S&P AA/negative, Scope AA/stable as of March 31, 2020 (2) F
Slide 35: 2020 currency sensitivity and Q1 2020 currency exposure
2020 currency sensitivity and Q1 2020 currency exposure 2020 Business EPS Currency Sensitivity Currency Variation Business EPS Sensitivity U.S. Dollar + 0.05 USD/EUR - EUR 0.13 Japanese Yen + 5 JPY/EUR - EUR 0.02 Chinese Yuan + 0.2 CNY/EUR - EUR 0.02 Brazilian Real + 0.4 BRL/EUR - EUR 0.01 Russian R
Slide 36: Business Net Income Statement – Q1 2020
Business Net Income Statement – Q1 2020 First Quarter Pharmaceuticals Consumer Healthcare Vaccines Others (2) Total Group € million Q1 2020 Q1 2019 (1) Change Q1 2020 Q1 2019 (1) Change Q1 2020 Q1 2019 (1) Change Q1 2020 Q1 2019 (1) Change Q1 2020 Q1 2019 (1) Change Net sales 6,764 6,259 8.1% 1,300
Slide 37: Consolidated Income Statements
Consolidated Income Statements € million Q1 2020 Q1 2019 Net sales 8,973 8,391 Other revenues 343 322 Cost of sales (2,865) (2,618) Gross profit 6,451 6,095 Research and development expenses (1,340) (1,385) Selling and general expenses (2,342) (2,376) Other operating income 108 64 Other operating ex
Slide 38: Reconciliation of Consolidated Net Income to Business Net Income – Q1 2020
Reconciliation of Consolidated Net Income Attributable to Equity Holders of Sanofi to Business Net Income – Q1 2020 € million Q1 2020 Q1 2019 (1) Change Net income attributable to equity holders of Sanofi 1,683 1,137 48.0% Amortization of intangible assets (2) 457 557 Impairment of intangible assets
Slide 39: Change in Net Debt
Change in Net Debt € million Q1 2020 Q1 2019 (1) Business net income 2,042 1,762 Depreciation &amortization & impairment of property, plant and equipment and software 367 355 Other non cash items (124) 152 Operating cash flow before change in working capital 2,285 2,269 Changes in Working Capital (4
Slide 40: R&D appendices
R&D appendices Q1 2020 Results April 24, 2020
Slide 41: R&D Pipeline – New Molecular Entities
R&D Pipeline – New Molecular Entities(*) Phase 1 Phase 2 Phase 3 Registration (Total : 20) (Total : 6) (Total : 7) (Total : 2) SAR441344(**)(1) ST400(**)(5) SAR440340(**)(11) SAR442168(**)(13) avalglucosidase alfa Sarclisa® Anti-CD40L mAb Ex Vivo ZFN Gene-Edited Cell Anti-IL33 mAb BTK inhibitor Neo
Slide 42: Additional Indications
Additional Indications(*) Phase 1 (Total : 6) Phase 2 (Total : 17) Phase 3 (Total : 27) Registration (Total : 3) O cemiplimab(**)(1) + REGN4018(**)(2) dupilumab(**)(1) isatuximab + cemiplimab(**)(1) Dupixent®(**)(1) isatuximab Fluzone® QIV HD Ovarian Cancer Grass pollen allergy Relapsed Refractory M
Slide 43: Expected submission timeline
Expected submission timeline(1) SAR439859 BIVV001(**)(6) SAR442168(**)(8) SAR339375 NMEs mBC 2/3L Hemophilia A Multiple Sclerosis Alport Syndrome sutimlimab avalglucosidase alfa fitusiran olipudase alfa venglustat SAR408701 romilkimab nirsevimab(**)(10) Cold Agglutinin Disease Pompe Disease Hemophil
Slide 44: Pipeline movements since Q4 2019
Pipeline movements since Q4 2019 Additions / Moves Removals from Sanofi pipeline Registration isatuximab efpeglenatide(2) Anti-CD38 mAb Long-acting GLP-1 agonist Smoldering multiple myeloma Type 2 Diabetes Phase 3 venglustat Oral GCS inhibitor GM2 gangliosidosis isatuximab SAR440340(**)(1) patients
Slide 45: R&D pipeline summary – Total projects
R&D pipeline summary – Total projects(1) Phase 1 Phase 2 Phase 3 Registration TOTAL Immuno-inflammation 3 7 9 1 20 Oncology 12 9 9 1 31 Rare Diseases 0 3 4 0 7 Rare Blood Disorders 4 0 4 0 8 Multiple Sclerosis and Neurology 3 3 2 0 8 Diabetes 0 0 0 1 1 Cardiovascular Disease 0 0 1 0 1 Vaccines 4 1 5
Slide 46: Expected R&D milestones
Expected R&D milestones Products Expected milestones Timing Sarclisa® EU regulatory decision with Pd(1) for Relapsed-Refractory Multiple Myeloma Q2 2020 Dupixent®(2)(**) U.S. regulatory decision in Moderate-to-Severe Atopic Dermatitis for 6-11 year-old age group(3) Q2 2020 MenQuadfiTM U.S. regulator