Sanofi SA · EURONEXT:SAN
Sanofi SA — Q3 2009 Earnings Presentation
51 slides from Sanofi SA's earnings presentation, Oct 30, 2009
Slide 1: Q3 2009 Results
Q3 2009 Results October 30, 2009 1
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 financial and product development project
Slide 3: Agenda
Agenda Q3 2009 Highlights Christopher A. Viehbacher, Chief Executive Officer Q3 2009 Business Performance Hanspeter Spek, Executive VP, Pharmaceutical Operations Q3 2009 Financial Performance Jérôme Contamine, Executive VP, Chief Financial Officer Q&A Session 3
Slide 4: Q3 2009 Highlights
Q3 2009 Highlights Christopher A. Viehbacher Chief Executive Officer 4
Slide 5: Solid Performance of our Key Growth Platforms in Q3 2009
Solid Performance of our Key Growth Platforms in Q3 2009 Key Growth Drivers Generic Competition Emerging markets: €1,888 m, +20.9% Eloxatin® in the U.S. Diabetes products: €947m, +18.9% €122m, -53.0% Vaccines: €1,046m, +4.8% and record Q4 expected Plavix® in EU €388m, -6.0% OTC: €356m, +26.3% New pr
Slide 6: Delivering Good Operational Performance in Q3 2009
Delivering Good Operational Performance in Q3 2009 Solid sales performance driven Reported sales (€m) by outperformance of our key 8 000 7 500 growth drivers 7 000 7,400 6 500 6,853 +6.0% at constant exchange 6 000 rates (CER) 5 500 5 000 +8.0% on a reported basis 4 500 4 000 Reduction of R&D and SG
Slide 7: Continuing to Roll-out our Three-Pronged Strategy
Continuing to Roll-out our Three-Pronged Strategy Adapt Increase Pursue our company innovation external growth to future in R&D opportunities challenges to ensure sustainable, profitable growth and improved risk profile 7
Slide 8: Increasing Innovation in our R&D Portfolio in Q3 2009 through New Partnerships and Acquisitions
Increasing Innovation in our R&D Portfolio in Q3 2009 through New Partnerships and Acquisitions Ophthalmology Oncology Diabetes Acquisition(1) of an Licensing agreement(1) Licensing agreement(1) integrated R&D of MM-121: a first-in- of PN2034: a novel oral company focused on class, fully human first
Slide 9: Fast-Tracking BSI-201 - The First PARP Inhibitor in Phase III for Triple Negative Breast Cancer
Fast-Tracking BSI-201 - The First PARP(1) Inhibitor in Phase III for Triple Negative Breast Cancer mTNBC(2) identified as lead indication Very promising interim ~ 20% of all breast cancers Phase II data presented at Poor prognosis and no specific treatment guidelines Efficacy outcomes (BSI-201+GC vs
Slide 10: Robust Phase II Results Lead to Decision to Move otamixaban into Phase III
Robust Phase II Results Lead to Decision to Move otamixaban into Phase III Approximately 1.8m NSTE-ACS(1) patients Key Product Characteristics Mode of action: synthetic direct A single anticoagulant therapy factor Xa inhibitor Current complex standard of care Mode of administration: i.v. bolus + bas
Slide 11: Moving R&D Projects Forward in Q3 2009
Moving R&D Projects Forward in Q3 2009 Main achievements in R&D pipeline Positive CHMP opinion on Multaq® in EU New Influenza A(H1N1) 2009 monovalent vaccine licensed in the U.S. Regulatory ClikSTAR® reusable insulin pen approved in EU and Canada Approvals Sculptra® aesthetic approved in the U.S. Ne
Slide 12: Building the Future Leader in Animal Health
Building the Future Leader in Animal Health Strategic transaction acquiring Merck’s 50% stake in Merial for $4bn completed in Q3 2009 100% Option to combine Merial with ISP(1) to create a global Animal Health leader (subject to the completion of the Merck / Schering- Plough merger) Option to combine
Slide 13: FY 2009 Guidance Updated
FY 2009 Guidance Updated Given the solid performance Adjusted EPS excluding delivered in the first 9 months selected items (€) of 2009 and the expected contribution 6,25 of A(H1N1) sales in Q4 2009, 6,00 Around sanofi-aventis now expects growth +11% of adjusted EPS excluding 5,75 selected items(1) o
Slide 14: Key Milestones Delivered in Q3 2009 & Next Events
Key Milestones Delivered in Q3 2009 & Next Events Solid Q3 2009 financial performance : Positive CHMP opinion on Multaq® and U.S. launch : Completion of acquisitions of Merial (100%) and Shantha Biotechnics : Further bolt-on acquisitions (e.g. Fovea) : New external R&D partnerships (e.g. Merrimack,
Slide 15: Q3 2009 Business Performance
Q3 2009 Business Performance Hanspeter Spek Executive VP, Pharmaceutical Operations 15
Slide 16: Multiple Growth Platforms Show Sales Growth in Q3 2009
Multiple Growth Platforms Show Sales Growth in Q3 2009 Total sales of €7,400m, +6.0%(1) Pharma sales of €6,354 m, +6.2%(1) despite generic competition Expansion of OTC and Generics growth platforms Worldwide presence(2) €1,686m, +6.3% Vaccines sales growth of +4.8%(1) taking into account change in p
Slide 17: Delivering Growth in Europe and the U.S. and Growing Leadership in Emerging Markets
Delivering Growth in Europe and the U.S. and Growing Leadership in Emerging Markets Solid performance in Europe in Q3 Q3 2009 Sales Split by Regions(1) 2009: €3,050m, +6.8%(1) Asia even with additional launches of Japan €418m Latin America €400m other clopidogrel salts Others +4.2% +8.2% (3) €494m €
Slide 18: Lantus Becomes #1 Brand of sanofi-aventis
Becomes #1 Brand of sanofi-aventis(1) Q3 2009 sales: €778m, +21.7%(2) U.S. Basal Insulins weekly MS(3) 80% Lantus® ClikSTAR® launched in EU and Canada 60% Value Share (%) 40% L2T3 study presented at EASD 2009 Detemir 20% Once-daily Lantus® requires a NPH significantly lower dose than insulin 0% 9 9
Slide 19: Maintaining a Strong Commitment to Oncology
Maintaining a Strong Commitment to Oncology Q3 2009 sales: Recent business development activities €526m, +1.4% to expand our oncology portfolio Stock fluctuation vs. Q3 2008 temporarily impacting growth Acquisition of BSI-201, a potential first-in- class PARP inhibitor now in Phase III in Positive C
Slide 20: Multaq Launch On-Track in the U.S.
- Launch On-Track in the U.S. ® U.S. Launches NRx(1) shares Q3 2009 sales: €13.0m 17,5% Actos® Product available since Jul 28, 2009 Promotional campaign fully launched 15,0% Diovan® on Sep 21, 2009 Weekly NRx share 12,5% 23,000 cumulative Rx(1) and around 5,500 prescribers(2) after 12 weeks 10,0% Ma
Slide 21: Multaq Preparing Global Roll-out in 2010
® - Preparing Global Roll-out in 2010 Positive CHMP opinion in the EU Planned launch schedule* received on September 25, 2009 Expected EC approval in early Q4 09 Q1 10 Q2 10 Q3 10 December 2009 Launches planned throughout 2010 Launched in Canada on Sep 28, 2009 Â ATHENA outcome study results reflect
Slide 22: Plavix Worldwide Presence Growing at +6.3% in Q3 2009
Worldwide Presence Growing at +6.3% in Q3 2009 Despite Challenging EU Situation Q3 ‘09 EU presence: €404m, -7.8%(1) Q3 ‘09 U.S. presence: €997m, +11.3%(1) On-going roll-out of Plavix® generics Patent protection until Nov 2011 Generics available in Belgium, study to apply for Denmark, Germany, Hollan
Slide 23: OTC and Generic Platforms - Dynamic Growth Areas
OTC and Generic Platforms - Dynamic Growth Areas OTC OTC Q3 2009 OTC sales Q3 2009 OTC sales: €356m, +26.3%(1) (+7.4% before acquisitions) 16% 8% Solid organic growth supported by acquisitions 5% 5% Build-up of a dedicated OTC organisation underway 4% NO- NO-SPA Acquisition of Oenobiol Others 4% 47%
Slide 24: Vaccines – Continued Growth in Q3 2009
Vaccines – Continued Growth in Q3 2009 Q3 2009 sales: €1,046m, +4.8%(1) Vaccines Reported Consolidated Sales (€m) 1 250 & driving pediatric sales growth 1 000 Q3 sales of €229m, +12.4% 750 ® - Strong quarter Q3 sales of €184m, +19.7% 500 Acquisition of completed 250 Award of 3-year SHAN5TM U.N. cont
Slide 25: The Undisputed Influenza Leader
- The Undisputed Influenza Leader On track to deliver a record year Influenza Global Estimates for 2009 Seasonal influenza, H5N1 and H1N1 (in million doses) Around $500m of H1N1 vaccines sales and 300 a large part of seasonal flu vaccines sales expected in Q4 2009 Over 180m doses of trivalent season
Slide 26: A Resilient Q3 2009 in Animal Health
- A Resilient Q3 2009 in Animal Health Stable Q3 2009 sales: $626m, -0.5%(1) Merial Q3 2009 Sales by Species Veterinary Growth in companion animal segment Public Health constrained by decline in household 4% Swine Companion consumption 4% 66% animals Production animal sales $217m slightly Avian 12%
Slide 27: Q3 2009 - Performance Maintained
Q3 2009 - Performance Maintained Overall sales growth of +6.0% in-line with previous quarter despite generics Strong contribution from Emerging Markets Launch of Multaq® on-track in the U.S. Sustained performance of Lantus® and vaccines Increased diversification of growth platforms starting to pay o
Slide 28: Q3 2009 Financial Performance
Q3 2009 Financial Performance Jérôme Contamine Executive VP, Chief Financial Officer 28
Slide 29: Solid Sales Growth in Q3 2009
Solid Sales Growth in Q3 2009 Reported net sales of €7,400m Q3 sales in €m (+8.0% in reported sales +2.0% +8.0% or +6.0% at CER) +2.8% 136 Change in Group structure 188 +3.2% Primarily reflecting the USD : +204 consolidation of Zentiva, 223 YEN : +74 Medley and Symbion GBP : -16 Others : -126 Positi
Slide 30: Reduction of SG&A and R&D to Sales Ratios in Q3 2009
Reduction of SG&A and R&D to Sales Ratios in Q3 2009(1) R&D to Sales ratio down to 15.0% Lower SG&A to Sales reflecting continuous cost control and in-line with seasonal trends Cost of Sales to Sales ratio impacted by: Mix effects Higher price for raw heparin (%) Q3 2009 Q3 2008 CoS/Sales Ratio 27.4
Slide 31: Delivering Good Operational Performance in Q3 2009
Delivering Good Operational Performance in Q3 2009(1,2) €m Q3 2009 Q3 2008 % Change (reported €) % Change (CER) Net sales 7,400 6,853 +8.0% +6.0% Other revenues 372 312 +19.2% +10.6% Cost of sales (2,028) (1,793) +13.1% +13.6% Gross profit 5,744 5,372 +6.9% +3.7% R&D (1,109) (1,089) +1.8% -0.6% SG&A
Slide 32: Good Margins in Q3 2009
Good Margins in Q3 2009(1) Operating Margin (%) Net Income/Sales Ratio (%) 39.9 38.5 30.1 28.1 Q3 08 Q3 09 Q3 08 Q3 09 Good margins in Q3 2009 despite additional launch of alternative clopidogrel salts in some EU countries and launch of Eloxatin® generics in early August in the U.S. (1) Adjusted P&L
Slide 33: Delivering Solid EPS Growth in Q3 2009
Delivering Solid EPS Growth in Q3 2009(1,2) €m Q3 2009 Q3 2008 % Change (reported €) % Change (CER) Adj. operating income current 2,955 2,640 +11.9% +4.5% Net financial expenses (69) (60) - - Income tax expense (837) (765) - - Effective tax rate 29.0% 29.6% - - Share of profit/loss of associates 294
Slide 34: Strong Cash Flow Generation at End September 2009
Strong Cash Flow Generation at End September 2009 Net Cash from Net Debt Operating Acquisitions & Net Debt Jan 1, 2009 Activities CapEx Licensing Dividends Sep 30, 2009 6 000 - 1,038 4 000 2 000 + 6,834 - 6,186 €m 0 - 1,780 -2 000 - 5,042 Change in - 2,872 Net Debt -4 000 - 3,262 -6 000 34
Slide 35: Q3 2009 - Delivering Another Strong Quarter
Q3 2009 - Delivering Another Strong Quarter Solid Q3 2009 sales performance Continued cost management in Q3 2009 Q3 2009 EPS(1) growth ahead of sales growth FY 2009 EPS(1) guidance updated Strong cash flow generation in the first 9 months of 2009 (1) Adjusted EPS before excluding selected items 35
Slide 36: Q&A Session
Q&A Session Christopher A. Viehbacher, Chief Executive Officer Hanspeter Spek, Executive VP, Pharmaceutical Operations Jérôme Contamine, Executive VP, Chief Financial Officer 36
Slide 37: Appendices - R&D
‘sanofi aventis. Because health matters Appendices ® R&D 37
Slide 38: Anticipated R&D Newsflow until September 2010 - Pharmaceuticals
Anticipated R&D Newsflow until September 2010 Key Milestones - Pharmaceuticals Timing BSI-201 in mTNBC - Phase II data presentation Q4 2009 Expected EC decision on Multaq® for Atrial Fibrillation Q4 2009 Plavix® U.S. regulatory submission for Atrial Fibrillation Q4 2009 Expected EU regulatory decisi
Slide 39: Anticipated R&D Newsflow until September 2010 - Vaccines
Anticipated R&D Newsflow until September 2010 Key Milestones - Vaccines Timing EU regulatory submission of Humenza™ (adjuvanted Flu H1N1) Q4 2009 EU regulatory submission of Pediacel® Q4 2009 Expected EU regulatory decisions on Panenza™ (non-adjuvanted Flu H1N1) Q4 2009 Expected EU regulatory decisi
Slide 40: Late Stage Pipeline – Pharma & Vaccines
Late Stage Pipeline – Pharma & Vaccines Phase III Registration Lantus® BSI-201 N Menactra® Multaq® N insulin glargine PARP inhibitor Meningococcal disease dronedarone Reduction in CV Triple Negative Breast Cancer Infant / Toddler 9-12 months Atrial fibrillation, EU morbidity & mortality AVE0010 N af
Slide 41: Early Stage Pipeline – Pharma & Vaccines
Early Stage Pipeline – Pharma & Vaccines Phase I Phase II AVE0010 + Lantus® XL147 N PN2034 N ferroquine N GLP-1 agonist + insulin glargine Oral PI3K inhibitor Insulin sensitizer Antimalarial Type 2 diabetes Cancer Type 2 Diabetes Malaria AVE0897 N XL765 N celivarone N SAR97276 N Balanced PPAR α/γ ag
Slide 42: R&D Pipeline Summary Table
R&D Pipeline Summary Table New Molecular Entities and Vaccines Development portfolio balanced across phases and therapeutic areas n tio I II III tr a A L ase ase ase gi s T Ph Ph Ph Re TO Metabolic Disorders 3 1 1 0 5 Cardiovascular 0 2 1 0 3 Central Nervous System 3 4 1 1 9 38 Oncology 6 0 6 0 12 T
Slide 43: Appendices - Finance
‘sanofi aventis. Because health matters Appendices @ Finance 43
Slide 44: Q3 2009 / 9M 2009: Adjusted Consolidated Income Statement (I)
Q3 2009 / 9M 2009: Adjusted Consolidated Income Statement excluding selected items* (I) As % of As % of % As % of As % of % Q3 2009 Q3 2008 € million 9M 2009 9M 2008 net sales net sales change net sales net sales change 7,400 100.0% 6,853 100.0% +8.0% NET SALES 21,945 100.0% 20,479 100.0% +7.2% 372
Slide 45: Q3 2009 / 9M 2009: Adjusted Consolidated Income Statement (II)
Q3 2009 / 9M 2009: Adjusted Consolidated Income Statement excluding selected items* (II) As % of As % of % As % of As % of % Q3 2009 Q3 2008 € million 9M 2009 9M 2008 net sales net sales change net sales net sales change OPERATING 2,955 39.9% 2,640 38.5% +11.9% 8,899 40.6% 7,564 36.9% +17.6% INCOME
Slide 46: Q3 2009 Reconciliation of Adjusted Income Statement to Consolidated
Q3 2009 Reconciliation of Adjusted Consolidated Income Statement excluding selected items to Consolidated Income Statement Q3 2009 Adjusted excl. € million selected items Selected Items Adjusted Adjustments Consolidated NET SALES 7,400 - 7,400 - 7,400 Other revenues 372 - 372 - 372 Cost of sales (2,
Slide 47: 9M 2009 Reconciliation of Adjusted Income Statement to Consolidated
9M 2009 Reconciliation of Adjusted Consolidated Income Statement excluding selected items to Consolidated Income Statement 9M 2009 Adjusted excl. € million selected items Selected Items Adjusted Adjustments Consolidated NET SALES 21,945 - 21,945 - 21,945 Other revenues 1,075 - 1,075 - 1,075 Cost of
Slide 48: Q3 2008 Reconciliation of Adjusted Income Statement to Consolidated
Q3 2008 Reconciliation of Adjusted Consolidated Income Statement excluding selected items to Consolidated Income Statement Q3 2008 Adjusted excl. € million selected items Selected Items Adjusted Adjustments Consolidated NET SALES 6,853 - 6,853 - 6,853 Other revenues 312 - 312 - 312 Cost of sales (1,
Slide 49: 9M 2008 Reconciliation of Adjusted Income Statement to Consolidated
9M 2008 Reconciliation of Adjusted Consolidated Income Statement excluding selected items to Consolidated Income Statement 9M 2008 Adjusted excl. € million selected items Selected Items Adjusted Adjustments Consolidated NET SALES 20,479 - 20,479 - 20,479 Other revenues 882 - 882 - 882 Cost of sales
Slide 50: Q3 2009 / 9M 2009: Vaccines Adjusted Income Statement (I)
Q3 2009 / 9M 2009: Vaccines Adjusted Consolidated Income Statement* (I) As % of As % of % As % of As % of % Q3 2009 Q3 2008 € million 9M 2009 9M 2008 net sales net sales change net sales net sales change 1,046 100.0% 947 100.0% +10.5% NET SALES 2,385 100.0% 2,152 100.0% +10.8% 8 0.8% 12 1.3% -33.3%
Slide 51: Q3 2009 / 9M 2009: Vaccines Adjusted Income Statement (II)
Q3 2009 / 9M 2009: Vaccines Adjusted Consolidated Income Statement* (II) As % of As % of % As % of As % of % Q3 2009 Q3 2008 € million 9M 2009 9M 2008 net sales net sales change net sales net sales change 391 37.4% 395 41.7% -1.0% OPERATING INCOME 749 31.4% 724 33.6% +3.5% Net financial (1) (0.1%) (