Sanofi Sa · EURONEXT:SAN
Sanofi Sa — Q1 2012 Earnings Presentation
45 slides from Sanofi Sa's earnings presentation, Apr 27, 2012
Slide 1: Q1 2012 Results
Q1 2012 RESULTS April 27th, 2012
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 Key Highlights ● Christopher A. Viehbacher, Chief Executive Officer Business Performance ● Hanspeter Spek, President, Global Operations Financial Performance ● Jérôme Contamine, Executive Vice President, Chief Financial Officer Q&A 3
Slide 4: Key Highlights
KEY HIGHLIGHTS Christopher A. Viehbacher Chief Executive Officer 4
Slide 5: 2012 - A Good Start to the Year
2012 - A Good Start to the Year Total Sales (€m) Business EPS (€) €8,511m €1.85 €7,779m €1.66 +7.0% +7.2% at CER at CER Q1 2011 Q1 2012 Q1 2011 Q1 2012 5
Slide 6: 2012 - Entering Final Phase of the Patent Cliff
2012 - Entering Final Phase of the Patent Cliff(1) Key Genericized Products(1) - Quarterly Sales (€m) €2,207m €813m Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2008 2008 2009 2009 2009 2009 2010 2010 2010 2010 2011 2011 2011 2011 2012 2012 2012 2012 (1) The patent cliff is the effect of th
Slide 7: Most Significant Headwind from the Patent Cliff in 2012
The Most Significant Headwind from the Patent Cliff in 2012 Will Impact Earnings but Not Sales Loss of Exclusivity of Plavix® and Avapro® in the U.S.(1) Evolution of Group Evolution of Group "Other Revenues" “Income from Associates" €1,669m €1,102m Expected Impact on - 54% - 62% 2012 Business Net In
Slide 8: Growth Platforms Accounted for 63.2% of Sales in Q1 2012
Growth Platforms Accounted for 63.2% of Sales in Q1 2012 Growth at CER Emerging Markets €2,624m +9.9%(1) Diabetes Solutions €1,311m +14.4% Consumer Health Care €805m +11.4% Vaccines €617m -0.2% Animal Health €578m -5.4% New Genzyme(2) €400m +13.7%(3) Innovative Products(4) €139m +6.3%(3) Growth is a
Slide 9: Genzyme Rare Diseases On Track
Genzyme Rare Diseases On Track ● Q1 2012 Genzyme rare diseases Quarterly Sales(1) (€m) sales reached €400m, +13.7%(1,2) Q1 2012 €149m ● Framingham plant granted EMA and Q1 2011 FDA approvals in January 2012 €139m ● U.S. patients and most severely Q1 2012 €112m affected EU patients moved to full Fabr
Slide 10: Significant Pipeline Progress over Last 9 Months
Significant Pipeline Progress over Last 9 Months Five new molecular entities submitted in last 9 months: Kynamro™ (mipomersen) – hoFH and severe heFH in Jul 2011 in EU and hoFH in Mar 2012 in the U.S. Aubagio™ (teriflunomide) – RMS in Aug 2011 in the U.S. and Feb 2012 in EU Visamerin® / Mulsevo® (se
Slide 11: New Data on Exciting R&D Assets in Q1 2012
New Data on Exciting R&D Assets in Q1 2012 (1) Anti-PCSK9 Zaltrap ® aflibercept mAb ● First in class agent addressing unmet ● Significant efficacy in RMS(2) needs in hypercholesterolemia with convenient annual dosing, and favorable benefit/risk balance ● Very encouraging Phase II data in clinical st
Slide 12: Only Therapy Slowing Accumulation of Disability
Only Therapy(1) Slowing Accumulation of Disability Sustained for 6 months vs. Active Comparator For Illustrative Purposes Higher Hurdle (2) Active Comparators Typical Threshold for Approval Placebo Higher Hurdle 3 month EDSS 6 month (1) Investigational compound (2) Based on CARE-MS II 12
Slide 13: CARE-MS I - Strong Effect on Relapse
CARE-MS I - Strong Effect on Relapse Proportion of Relapse-Free Patients at Year 2 HR 0.45 Lemtrada™ 12 mg/day P<0.001 Rebif® 78% 59% Coles A ECTRIMS 2011; platform presentation 13
Slide 14: CARE-MS II - Reversing Disability in Some Patients
CARE-MS II - Reversing Disability in Some Patients Mean EDSS Change from Baseline Rebif® Lemtrada™ 12 mg/day 0.24 p=0.0064 p<0.0001 ‒0.17 p=0.0044 EDSS: Expanded Disability Status Score Cohen J AAN 2012; platform presentation 14
Slide 15: Key R&D Milestones for the Remainder of 2012
Key R&D Milestones for the Remainder of 2012 2012 Expected Regulatory Submissions Q2 Q3 Q4 ● Lemtrada™ (alemtuzumab) in RMS(1) in the U.S. and EU ● Lyxumia® (lixisenatide) in Type 2 diabetes in the U.S.(2) Expected Headline Data Releases ● Lantus® - ORIGIN study results ● Lantus® - Retrospecti
Slide 16: Business Performance
BUSINESS PERFORMANCE Hanspeter Spek President, Global Operations 16
Slide 17: Double Digit Growth in Key Emerging Markets in Q1 2012
Double Digit Growth in Key Emerging Markets in Q1 2012 ● Q1 2012 Emerging Markets(1) sales of €2,624m, up +9.9% at CER ● Strong sales in BRIC of €917m, +16.5% at CER Emerging Markets Q1 2012 Sales Split (Growth at CER) +16.0% +11.7% +2.1% +8.1% (1) World excluding North America (USA, Canada), Wester
Slide 18: Double Digit Growth in Diabetes Sustained for Five Consecutive Quarters
Impressive Double Digit Growth in Diabetes Sustained for Five Consecutive Quarters ● Q1 2012 Diabetes sales of €1,311m, Quarterly Sales (€m) +17.8% or +14.4% at CER €1,118m ● Strong performance of Lantus®, up +17.2% at CER ● SoloSTAR® accounted for 51.1% of quarterly sales in the U.S. ● Solid perfor
Slide 19: Q1 2012 - Good Quarter for Oncology
Q1 2012 - Good Quarter for Oncology ● Q1 2012 Oncology sales of €741m, Quarterly Sales (€m) +16.7% or +12.8% at CER €741m ● Sales of Jevtana® reached €54m, up +10.4% at CER ● Taxotere® sales of €150m despite loss 51.8% of exclusivity in the U.S. and EU ● Sales of €133m from ex-Genzyme oncology brand
Slide 20: Flagship Brands Continue to Grow outside the U.S.
Flagship Brands Continue to Grow in Key Geographies outside the U.S. in Q1 2012 Quarterly Sales (€m) Quarterly Sales (€m) €404m €359m +11.9% at CER €168m +11.9% at CER €191m +5.2% at CER Q1 2010 Q1 2011 Q1 2012 Q1 2010 Q1 2011 Q1 2012 Emerging Markets Japan Ex-US 20
Slide 21: Record Consumer Health Care Sales in Q1 2012
Record Consumer Health Care Sales in Q1 2012 ● Strong Q1 2012 sales of €805m, Quarterly Sales (€m) +13.1% or +11.4 % at CER ® €805m ● Good start of 2nd year for Allegra +1.8% Others €711m OTC in the U.S. with sales of €87m, +5.0% at CER Emerging +21.9% €491m Markets ● Strong performance in Emerging
Slide 22: Sanofi Pasteur Growth in Q1 2012
Sanofi Pasteur Growth in Q1 2012 Impacted by Timing of Seasonal Flu Campaign in Emerging Markets ● Q1 2012 sales of €617m, +2.5% or -0.2% at CER Quarterly Sales (€m) €371m ● Strong sales in mature markets +11.2% at CER ● Solid performance of Pentacel® and Menactra® in the U.S. €246m ● Emerging marke
Slide 23: Merial Sales In-Line with Expected Quarterly Phasing
Merial Sales In-Line with Expected Quarterly Phasing in Q1 2012 ● Solid Q1 2012 sales of €578m, but Quarterly Sales (€m) performance impacted by tough comparable (-2.7% or -5.4% at CER) ● Return to growth expected for the remainder of 2012 ● Companion Animals sales of €398m (-6.1% at CER) ● Strong F
Slide 24: Financial Performance
FINANCIAL PERFORMANCE Jérôme Contamine Executive Vice President, Chief Financial Officer 24
Slide 25: Growth Platforms and Genzyme More than Offset Genericized Products
Growth Platforms and Genzyme More than Offset Impact of Key Genericized Products in Q1 2012 Q1 2012 sales (€m) +9.4% + €187m USD : +€110m JPY : +€51m (2) (2) CNY : +€22m + €733m Others : +€4m €8,511m - €235m €7,779m - €240m + €287m (3) Q1 2011 Key Others Growth Genzyme FX Impact Q1 2012 Genericized
Slide 26: BOI Double Digit Growth in Q1 2012
BOI Double Digit Growth in Q1 2012 Reflects Genzyme Consolidation and Cost Savings €m Q1 2012 Q1 2011 % Change % Change (reported €) (CER) Net sales 8,511 7,779 +9.4% +7.0% Other revenues 426 413 +3.1% -0.5% Cost of sales (2,613) (2,362) +10.6% +9.5% Gross profit 6,324 5,830 +8.5% +5.5% R&D (1,176)
Slide 27: Cost of Sales Ratio Improved in Q1 2012
Cost of Sales Ratio Improved in Q1 2012 ● Q1 2012 Cost of Sales of €2,613m Cost of Sales (%) ● Cost of Sales ratio improvement 30.4% 31.0% 31.5% 32.0% 30.7% reflecting: ● Positive impact from productivity improvements and reduced cost of crude heparin ● Negative impact from loss of sales from key ge
Slide 28: R&D to Sales Ratio Down in Q1 2012
R&D to Sales Ratio Down in Q1 2012 ● Q1 2012 R&D expenses of R&D/Sales Ratio (%) €1,176m 15.2% 14.1% 14.3% 13.9% ● R&D spend in line with quarterly 13.8% average of last 2 years ● Integration of Genzyme R&D ● Ongoing transforming initiatives ● R&D/Sales ratio down 0.7 point vs. Q1 2010 Q1 2011 Q2 20
Slide 29: SG&A to Sales Ratio Stable in Q1 2012
SG&A to Sales Ratio Stable in Q1 2012 ● Q1 2012 SG&A expenses of SG&A/Sales Ratio (%) €2,121m, up +7.4% at CER 27.2% ● SG&A expenses down 4.9% with 26.1% 24.8% 24.2% 24.9% Genzyme pro forma ● SG&A/Sales ratio stable vs. Q1 2011 reflecting: ● Tight control of SG&A expense ● Genzyme synergies Q1 2011
Slide 30: Business Net Income up 12.5% in Q1 2012
Business Net Income up 12.5% in Q1 2012 €m Q1 2012 Q1 2011 % Change % Change (reported €) (CER) Business operating income 3,417 3,027 +12.9% +8.9% Net financial expenses (119) (78) - - Income tax expense (856) (779) - - Effective tax rate -28.0% -28.5% - - Business net income 2,442 2,170 +12.5% +8.4
Slide 31: Strong Free Cash Flow Generated in Q1 2012
Strong Free Cash Flow Generated in Q1 2012 In €m ● Strong Free Cash Flow of €2,467m, up +23.0% in Q1 2012+ €2,016m ● €404m of opportunistic share -8,605 repurchases in Q1 2012(1) -10,859 -360 -104 ● Net debt reduced by €2,254m in Q1 2012 -404 +295 ● Gearing of 14.9% by end of FCF March 2012 2,467 Ne
Slide 32: Continued Strong Execution of Strategy in Q1 2012
Continued Strong Execution of Strategy in Q1 2012 1 Good performance from growth platforms 2 Positive contribution from Genzyme integration 3 Significant progress on late stage pipeline 4 Sustained cost control 5 Guidance for FY 2012 reaffirmed 32
Slide 33: Appendices: R&D Pipeline
APPENDICES R&D Pipeline SANOFI x
Slide 34: Late Stage Pipeline – Pharma & Vaccines
Late Stage Pipeline – Pharma & Vaccines Phase III Registration eliglustat tartrate N SYNVISC-ONE™ Quadracel® Hexaxim® Glucosylceramide synthetase inhibitor Medical device Diphtheria, tetanus, pertussis DTP-HepB-Polio-Hib vaccine Gaucher disease Pain in hip OA & polio vaccine; 4-6 y of age iniparib N
Slide 35: Early Stage Pipeline – Pharma & Vaccines (Phase II)
Early Stage Pipeline – Pharma & Vaccines Phase II N N iniparib FOV1101 SAR231893 (BSI-201) FDC prednisolone/cyclosporine Anti-IL4 mAb Ovarian cancer (2L) Allergic conjunctivitis Asthma; Atopic dermatitis SAR3419 N N N safotibant (FOV2304) ferroquine Maytansin-loaded anti-CD19 mAb Bradykinin B1 antag
Slide 36: Early Stage Pipeline – Pharma & Vaccines (Phase I)
Early Stage Pipeline – Pharma & Vaccines Phase I SAR153192 N Jevtana® SAR402665 N Rotavirus Anti-DLL4 mAb Cabazitaxel, Microtubule inhibitor (rhASM) Live Attenuated Tetravalent Solid tumors Gastric cancer (2L) Niemann-Pick type B Rotavirus oral vaccine SAR402674 (Genz644282) N SAR127963 N SAR339658
Slide 37: R&D Pipeline Summary Table
R&D Pipeline Summary Table New Molecular Entities (NMEs) and Vaccines Phase I Phase II Phase III Registration TOTAL Oncology 6 4 3 2 15 Metabolic Disorders 2 1 0 2 5 Thrombosis 1 0 1 0 2 Central Nervous System 2 0 1 1 4 48 Internal Medicine 3 5 1 0 9 Ophthalmology 3 2 0 0 5 Genetic Diseases 1 0 1 0
Slide 38: Expected R&D Milestones – Pharmaceuticals
Expected R&D Milestones – Pharmaceuticals Product Event Timing LemtradaTM Regulatory submission in RMS in EU and U.S. Q2 2012 anti-PCSK-9 mAb Initiation of Phase III program in hypercholesterolemia Q2 2012 Lantus® ORIGIN Phase III results Q2 2012 AubagioTM TOWER headline Phase III results in RMS Mid
Slide 39: Expected R&D Milestones – Pharmaceuticals
Expected R&D Milestones – Pharmaceuticals Product Event Timing Lyxumia® Expected approval in type 2 diabetes in EU Q4 2012 Zaltrap® Expected approval in 2nd line mCRC in EU Q4 2012 Lyxumia® Regulatory submission in type 2 diabetes in U.S. Q4 2012 sarilumab Additional Phase III in rheumatoid arthriti
Slide 40: Expected R&D Milestones – Vaccines
Expected R&D Milestones – Vaccines Product Event Timing HexaximTM Scientific opinion issued by EMA Q2 2012 Shan5® Start Phase III clinical study Q2 2012 Fluzone® QIV IM File submission in U.S. Q3 2012 Rotavirus Start Phase I clinical study Q3 2012 HexaximTM File submission in EU Q3 2012 Dengue vacci
Slide 41: Appendices: Finance
APPENDICES FINANCE SANOFl xy
Slide 42: Business Net Income Statement
Business Net Income Statement First quarter 2012 Pharmaceuticals Vaccines Animal health Other Group Total Millions of euros Q1 2012 Q1 2011 % change Q1 2012 Q1 2011 % change Q1 2012 Q1 2011 % change Q1 2012 Q1 2011 Q1 2012 Q1 2011 % change Net sales 7,316 6,583 11.1% 617 602 2.5% 578 594 (2.7%) 8,51
Slide 43: Reconciliation of Business Net Income to Consolidated Net Income
Reconciliation of Business Net Income to Consolidated Net Income Attributable to Equity Holders of sanofi Millions of euros Q1 2012 Q1 2011 % change Business net income 2,442 2,170 12.5% Amortization of intangible assets (1) (833) (736) Impairment of intangible assets (1) (32) Fair value remeasureme
Slide 44: Consolidated Income Statements
Consolidated Income Statements € million Q1 2012 Q1 2011 Net sales 8,511 7,779 Other revenues 426 413 Cost of sales (2,627) (2,364) Gross profit 6,310 5,828 Research and development expenses (1,176) (1,100) Selling and general expenses (2,121) (1,933) Other operating income 206 118 Other operating e
Slide 45: Consolidated Income Statements
Consolidated Income Statements € million Q1 2012 Q1 2011 Operating income 2,206 1,358 Financial expenses (139) (101) Financial income 20 23 Income before tax and associates and joint ventures 2,087 1,280 Income tax expense (496) (269) Share of profit / loss of associates and joint ventures 289 285 N