Slide 1: Q2 2020 Results
Q2 2020 Results Play to Win July 29, 2020
Slide 2: Forward looking statements
Forward looking statements This document 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 underlyin
Slide 3: Agenda
Agenda Business Update Paul Hudson Chief Executive Officer Financial results Jean-Baptiste de Chatillon EVP, Chief Financial Officer Conclusion Paul Hudson Chief Executive Officer Q&A session 3
Slide 4: Key highlights
Key highlights Paul Hudson Chief Executive Officer
Slide 5: 'Play to Win' transformation drives H1 EPS growth of 9.2%
‘Play to Win’ transformation drives H1 EPS growth of 9.2% Company sales Key drivers • Dupixent® impressive growth continued, +94% €17,019m €17,180m • Resilience of Specialty Care portfolio, +24% +1.6% • Cost savings of €990m(2) H1 2019 H1 2020 COVID-19 headwinds Business EPS • Q1 channel inventory b
Slide 6: 'Play to Win' execution in Q2
‘Play to Win’ execution in Q2 • New executive leadership team completed • Regeneron equity stake sale Transforming • Investing in new vaccine facilities Sanofi • Strong management of savings • 5 virtual R&D Day events • BTKi ‘168 Phase 3 program across MS spectrum initiated • Positive Dupixent® inte
Slide 7: Dupixent – on track to deliver on >€10bn ambition
Dupixent® – on track to deliver on >€10bn ambition Global Dupixent® quarterly sales (€m) • Dupixent® launched in 44 countries in adult AD • 54 additional launches in 2020 as planned 858 • Adult AD launched in China 776 Ex-U.S. 161 679 (+72%)(2) • First prescriptions on July 22nd 163 570 134 • Approv
Slide 8: Unique profile makes Dupixent a leader in Type 2 inflammatory disease
Unique profile makes Dupixent® a leader in Type 2 inflammatory disease U.S. weekly NBRx(1) • Adding new patients to Dupixent® treatment 2,500 • Rapidly adapted approach to prescriber e-detailing • In-office patient visits restarting, dermatologist visits at ~60% of pre-COVID levels(2) NYC confinemen
Slide 9: Dupixent – major growth opportunity in China
Dupixent® – major growth opportunity in China High unmet need in first approved type 2 indication, adult AD(1) • Dupixent® launched 25 days after NMPA approval(5) • First biologic approved for adult with moderate to severe ~2-5% of Prevalence atopic dermatitis adult urban population • Targeting larg
Slide 10: Specialty Care – double-digit growth driven by Dupixent
Specialty Care – double-digit growth driven by Dupixent® Specialty Care Q2 2020 sales growth (+17%) by franchise • Strength of franchises during COVID-19 • Dupixent® strong performance in AD, asthma and Dupixent® +70% CRSwNP • Oncology up due to Libtayo® and legacy brands Oncology +18% • Sarclisa® J
Slide 11: Vaccines – prepared for new record flu sales
Vaccines – prepared for new record flu sales Q2 2020 Vaccines sales by geography • Vaccines Q2 sales of €927m, down 6.8% €1,021m • Q2 sales drivers • Strong flu sales in Southern hemisphere up +40% -€134m €927m • PPH up 18% due to China Pentaxim® (+72%) +€77m -€37m • U.S. franchises impacted from CO
Slide 12: General Medicines – resilient performance of glargine
General Medicines – resilient performance of glargine Q2 2020 General Medicines sales evolution • General Medicines down 12.7% to €3,549m in Q2 €4,165m • China VBP volume growth of >60% remains on track -€204m • Plavix® (-58%) and Aprovel® (-44%) sales in line with -€142m expectations -€126m -€144m
Slide 13: CHC – H1 2020 sales up 1.6% ex-Zantac
CHC – H1 2020 sales up 1.6% ex-Zantac® Q2 2020 CHC sales by category • CHC down 8.0% to €1,024m in Q2 €157m • Strong U.S. spring allergy season (Xyzal® +69%) +1.3% Other Allergy, Cough & €242m • COVID-19 impacted demand Cold -3.2% €154m Nutritional • Reversal of Q1 ‘pantry loading’ as anticipated +4
Slide 14: Highlighting the potential of our priority assets
Highlighting the potential of our priority assets Asset Key progress in H1 2020 Planned initial submission(1) Dupixent®(2) AD U.S. 6-11 years & China adults approval; EoE pivotal results Launched Fitusiran & Fitusiran & BIVV001 Phase 3 enrollment ongoing 2021e/2022e BIVV001(3) SERD '859 2/3L mBC Pha
Slide 15: Recent deals aligned with Sanofi's new approach to R&D
Recent deals aligned with Sanofi’s new approach to R&D Platforms CD38 knockout NK cells Expanded tools for E3 ligase-based protein Novel mRNA vaccines sourced from universal drug discovery degradation technology platform donors Pathways Complete IRAK4 knockdown Leveraging innate immune rather than s
Slide 16: 2021 – significant year for Sanofi's pipeline ahead
2021 – significant year for Sanofi’s pipeline ahead Pivotal results(1) Proof of concept readouts(1) • SERD ‘859 2L/3L monotherapy in mBC • Venglustat GBA PD • Fitusiran for Hemophilia A & B • SHP2(2) for solid tumors in combination • BIVV001 for Hemophilia A • Sarclisa® subcutaneous formulation • Du
Slide 17: Financial update
Financial update Jean-Baptiste de Chatillon EVP, Chief Financial Officer 17
Slide 18: BOI margin up in Q2 2020
BOI margin up in Q2 2020 €m Q2 2020 Q2 2019(1) % Change (CER) Net Sales 8,207 8,628 -3.4% Other revenues 231 352 -35.5% Gross Profit 5,778 6,213 -6.0% Gross margin % 70.4% 72.0% R&D (1,352) (1,587) -15.1% SG&A (2,265) (2,459) -7.1% Other current operating income & expenses (8) (91) - Share of profit
Slide 19: H1 2020 gross margin ratio of 71.3%
H1 2020 gross margin ratio of 71.3% Gross margin ratio(1) in Q2 72.0% 70.4%(2) • Specialty care growth 71.7% + • Industrial productivity • Geographic mix - • China VBP on Plavix® and Aprovel® Family Q2 2019 Q2 2020 All growth at CER; GM: gross margin; VBP: Volume Based Procurement (1) Gross Margin i
Slide 20: Double-digit Opex improvement mainly driven by R&D prioritization and efficiencies
Double-digit Opex improvement mainly driven by R&D prioritization and efficiencies Operating expense evolution • Lower y-o-y R&D expense reflects deprioritization of diabetes and cardiovascular initiated in 2019 €4,046m €3,617m -10.2% • Spend on ongoing pipeline programs continues to increase compar
Slide 21: BOI margin evolution in H1 2020
BOI margin evolution in H1 2020 27.3% +1.0ppts 26.2% 26.3% -0.9ppts +1.0ppts 25.3% H1 2019 reported Removal of H1 2019 restated Cost savings(1) H1 2020 before Revaluation H1 2020 reported associate share revaluation of remaining income REGN shares from REGN BOI margin target of 30% in 2022 ‘upgraded
Slide 22: Strategic choices expected to drive margin expansion
Strategic choices expected to drive margin expansion Focus on growth Lead with Targeting Lead with innovation innovation 30% BOI margin Accelerate by 2022 efficiency Ambition for BOI margin >32% by 2025 Reinvent how we work 22
Slide 23: €990M of savings already achieved in H1 2020
€990M(1) of savings already achieved in H1 2020(2) Accelerate efficiency €1bn 2022 target COVID related Efficiencies realized in H1 2020 €500M €500M €110M €320M €260M €300M H1 2020 Priorities Smart spending Operation excellence Reduction in training -52% Travel expenses(3) -23% Events expenses(3) -3
Slide 24: Streamlining of Established Products tail underway
Streamlining of Established Products tail underway Number of product families ~300 ~220 • Divestitures include Seprafilm® and a portfolio of EP tail products • Total of ~€680 million cash proceeds during H1 2020 Long tail • Objective to reduce to ~100 product families by 2025 2018 H1 2020 EP: Establ
Slide 25: Favorable FCF phasing in H1
Favorable FCF phasing in H1 Free Cash Flow(1) evolution +133% Free Cash Flow(1) growth drivers €3.6bn • Business performance • Smart spending initiatives One-off benefits €2.1bn • Asset disposals (€682m(2) in H1 20 vs. €199m in H1 19) €1.5bn • COVID-19 (favorable impact on receivables in H1 20) • Mi
Slide 26: Expected business dynamics in Q3 2020
Expected business dynamics in Q3 2020 New patient starts and elective procedures expected to recover, but Pharmaceuticals likely not yet to return to pre-COVID levels. Record flu season in Northern hemisphere, vaccinations(1) expected to Vaccines recover, but not yet at pre-COVID levels; travel vacc
Slide 27: FY 2020 business EPS guidance raised to 6-7%
FY 2020 business EPS guidance raised to 6-7% Business EPS +6-7% at CER(1,2) FX impact Approximately -3% to -4%(3) on business EPS based on July 2020 average exchange rates (1) Compared to FY 2019 and barring major unforeseen adverse events (2) Base for FY 2019 Business EPS growth is €5.64 reflecting
Slide 28: Key highlights
Key highlights Paul Hudson Chief Executive Officer
Slide 29: Integrating ESG into Sanofi's 'Play to Win' strategy
Integrating ESG into Sanofi’s ‘Play to Win’ strategy Focus Lead with Accelerate Reinvent how on growth innovation efficiency we work • Contribute to global • Beyond science and • Provide global • Give a chance to healthcare access medicine to help supply chains to everyone to be a and affordability
Slide 30: New executive team completed with appointments in Q2
New executive team completed with appointments in Q2 CEO Finance Paul Hudson Legal Jean-Baptiste de Chatillon Karen Linehan R&D Specialty Care John Reed Bill Sibold Industrial Affairs General Medicines Philippe Luscan Olivier Charmeil Digital Vaccines Arnaud Robert Consumer Healthcare Human Resource
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 John Reed Bill Sibold EVP, Global Head of R&D EVP, Specialty Care – Sanofi Genzyme Thomas Triomphe EVP,
Slide 32: Financial appendices
Financial appendices Q2 2020 Results July 29, 2020
Slide 33: Q2 sales and EPS impacted by weakening EM currencies
Q2 sales and EPS impacted by weakening EM currencies Currency impact Company sales(1) Business EPS -€130m -€0.02 -1.5% -1.6% Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2 2019 2020 2019 2020 (1) Main currency impact on Company Sales in Q2 2020: US Dollar (+€61m), Argentine Peso (-€37m), Japanese Yen (+€19m), Brazil
Slide 34: Net debt evolution in H1 2020
Net debt evolution in H1 2020(1) €3,568m €15,107m €471m €10,512m €3,937m €7,680m €2,245m Net Debt Free Cash Sale of Acquisitions Dividend Other(7) Net Debt December 31, Flow(4) Regeneron & Licences(6) June 30, 2019(2,3) Shares(5) 2020(2) (1) Credit ratings reaffirmed: Moody’s A1/stable, S&P AA/stabl
Slide 35: 2020 currency sensitivity and Q2 2020 currency exposure
2020 currency sensitivity and Q2 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: R&D appendices
R&D appendices Q2 2020 Results July 29, 2020
Slide 37: R&D Pipeline – New Molecular Entities
R&D Pipeline – New Molecular Entities(*) Phase 1 Phase 2 Phase 3 Registration (Total : 19) (Total : 6) (Total : 7) (Total : 1) SAR441344(**)(1) ST400(**)(5) SAR440340(**)(10) R SAR439859 SAR442168(**)(13) sutimlimab Anti-CD40L mAb Ex Vivo ZFN Gene-Edited Cell Anti-IL33 mAb SERD BTK inhibitor Anti Co
Slide 38: Additional Indications
Additional Indications(*) Phase 1 (Total : 6) Phase 2 (Total : 18) Phase 3 (Total : 22) Registration (Total : 4) O cemiplimab(**)(1) + REGN4018(**)(2) dupilumab(**)(1) isatuximab + cemiplimab(**)(1) Dupixent®(**)(1) cemiplimab(**)(1) MenQuadfiTM Ovarian Cancer Grass pollen allergy Lymphoma Asthma 6
Slide 39: Expected submission timeline
Expected submission timeline(1) Baculovirus(**)(4) recomb. vaccine COVID-19 SAR439859 mRNA vaccine(**)(5) BIVV001(**)(7) SAR442168(**)(9) SAR339375 NMEs mBC 2/3L COVID-19 Hemophilia A Multiple Sclerosis Alport Syndrome avalglucosidase alfa fitusiran olipudase alfa venglustat SAR408701 romilkimab nir
Slide 40: Pipeline movements since Q1 2020
Pipeline movements since Q1 2020 Additions / Moves Removals from Sanofi pipeline sutimlimab Shan 6 Anti Complement C1s mAb Registration Cold Agglutinin Disease Pediatric hexavalent vaccine Aubagio® Relapsing MS – Pediatric SAR442168(**)(1) BTK inhibitor Pediatric pentavalent sarilumab(**)(3) Multipl
Slide 41: 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 7 1 18 Oncology 14 9 9 0 32 Rare Diseases 0 4 4 0 8 Rare Blood Disorders 4 0 3 1 8 Multiple Sclerosis and Neurology 1 1 2 1 5 Diabetes 0 0 0 0 0 Cardiovascular Disease 0 0 1 0 1 Vaccines 3 3 3
Slide 42: Expected R&D milestones
Expected R&D milestones Products Expected milestones Timing SERD ‘859 Proof of concept study read-out in Breast Cancer (combination, adjuvant) H2 2020 sutimlimab U.S. regulatory decision in Cold Agglutinin Disease H2 2020 Flublok® EU regulatory decision for > 18-year old age group H2 2020 Dupixent®(
Slide 43: Accelerating global COVID-19 vaccine availability
Accelerating global COVID-19 vaccine availability Platform Expected timeline Availability 2020 2021 H2 H1 H2 September January June Phase 1/2 start Potential Earliest (>400 patients) emergency use approval(2) 1bn Baculovirus authorization 1 doses(3) recombinant December approach(1) Preliminary H2 20