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Q3 2012 Results
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Q3 2012 RESULTS
October 25th, 2012
2
Forward Looking Statements
This presentation contains forward-looking statements as defined in the Private Securities Litigation Reform Act of1995, as amended. Forward-looking statements are statements that are not historical facts. These statements includeprojections and estimates and their underlying assumptions, statements regarding plans, objectives, intentions andexpectations with respect to future financial results, events, operations, services, product development and potential,and statements regarding future performance. Forward-looking statements are generally identified by the words"expects", "anticipates", "believes", "intends", "estimates", "plans" and similar expressions. Although Sanofi'smanagement believes that the expectations reflected in such forward-looking statements are reasonable, investors arecautioned that forward-looking information and statements are subject to various risks and uncertainties, many of whichare difficult to predict and generally beyond the control of Sanofi, that could cause actual results and developments todiffer materially from those expressed in, or implied or projected by, the forward-looking information and statements.These risks and uncertainties include among other things, the uncertainties inherent in research and development,future clinical data and analysis, including post marketing, decisions by regulatory authorities, such as the FDA or theEMA, regarding whether and when to approve any drug, device or biological application that may be filed for any suchproduct candidates as well as their decisions regarding labeling and other matters that could affect the availability orcommercial potential of such product candidates, the absence of guarantee that the product candidates if approved willbe commercially successful, the future approval and commercial success of therapeutic alternatives, the Group's abilityto benefit from external growth opportunities, trends in exchange rates and prevailing interest rates, the impact of costcontainment policies and subsequent changes thereto, the average number of shares outstanding as well as thosediscussed or identified in the public filings with the SEC and the AMF made by Sanofi, including those listed under"Risk Factors" and "Cautionary Statement Regarding Forward-Looking Statements" in Sanofi's annual report on Form20-F for the year ended December 31, 2011. Other than as required by applicable law, Sanofi does not undertake anyobligation to update or revise any forward-looking information or statements.
3
Agenda
3
Key Highlights
● Christopher A. Viehbacher, Chief Executive Officer
Business Performance● Hanspeter Spek, President, Global Operations
● Olivier Charmeil, Senior Vice President, Vaccines
Financial Performance
● Jérôme Contamine, Executive Vice President, Chief Financial Officer
Q&A
KEY HIGHLIGHTS
Christopher A. Viehbacher
Chief Executive Officer
4
Quarterly Sales (€m)
Q3 2011 Q3 2012
€9,040m
(1) Eloxatin® and Aprovel® lost their exclusivity in the U.S. and EU, respectively, in August 2012 (2) On a reported basis, Q3 2012 sales were up +3.3% and YTD 2012 sales were up +6.2%. 5
-3.1%at CER(2)
YTD Sales (€m)
YTD 2011 YTD 2012
€26,421m
+1.2%at CER(2)
€24,881m€8,753m
Generic Competition to Legacy Blockbusters(1)
Impacted Sales Evolution in Q3 2012
YTD 2011 YTD 2012
YTD Business EPS (€)
€5.01
(1) On a reported basis, Q3 2012 Business EPS was down -6.1% and YTD 2012 Business EPS was down -1.6%.6
-8.4%at CER(1)
Q3 2011 Q3 2012
Quarterly Business EPS (€)
€1.68
-14.5%at CER(1)
€5.09€1.79
Q3 2012 Business EPS Decline Reflectsthe Loss of Exclusivity of Plavix® and Avapro® in the U.S.
Growth Platforms Sales(€m and % of Total Sales)
Q2 Q1 Q2 Q3
€6,412m
€5,381m
Growth Platforms Represent Over 70% of Sales
(1) Key genericized products include Lovenox® U.S., Plavix® Western EU, Taxotere® Western EU & U.S., Eloxatin® U.S., Ambien® family U.S., Allegra® U.S., Aprovel® Western EU, Xyzal® U.S., Xatral® U.S., Nasacort® U.S. and BMS Alliance (active ingredients of Plavix® and Avapro® sold to BMS) 7
Q2 Q1 Q2 Q3
4.4%of Total Sales
€813m€399m
Key Genericized Products Sales(1)
(€m and % of Total Sales)
€752m
€5,753m
70.9%of Total Sales
€3,339m
€2,207m
20122009 20122009
Growth Platforms Grew by +6.4% in Q3 2012
8(1) New Genzyme perimeter includes Rare Diseases and Multiple Sclerosis franchises(2) Includes new product launches which do not belong to the Growth Platforms listed above: Multaq®, Jevtana®, Mozobil® and Zaltrap®
+17.5%
+0.7%
+5.9%
+3.8%
+22.5%
Innovative Products(2) €154m +7.6%
+6.8%
Vaccines €1,481m
Diabetes Solutions €1,486m
Consumer Health Care €733m
Animal Health €519m
Emerging Markets €2,821m
New Genzyme(1) €470m
Growth at CER
9
Genzyme Delivered Strong Performance in Q3 2012
Quarterly Sales (€m)● Q3 2012 rare diseases sales
reached €470m, up +22.5% at CER
● Strong rebound of Fabrazyme®
benefiting from:
● Supply from new Framingham plant
● Shire’s withdrawal of Replagal® BLA in the U.S. earlier this year
● Cerezyme® and Myozyme® growing at high-single digit rate at CER
&
87
116
141
101
32
163
Q32012
Q32011
Q32012
Q32011
Q32012
Q32011
(1) BLA: Biologics License Application
Eliglustat(1) - A Novel Oral Therapy in Gaucher Disease
● Potent, novel substrate inhibitor
● Oral therapy ● Eliminating challenges of infusions
● Positive results from ENGAGE, first Phase III study (vs. placebo)● Primary endpoint and all secondary
endpoints met ● Well tolerated with no serious
adverse events reported
● ENCORE Phase III results (vs. Cerezyme®) expected in early 2013
10(1) Eliglustat tartrate is an investigational drug(2) Secondary endpoints included improvements in hemoglobin levels and platelet levels, as well as liver volumes
+2%
-28%
Placebo
Eliglustat
Change in Spleen Volume(% change at 9 months)
30%Absolute Difference
11
(1) ZALTRAP® is indicated in combination with FOLFIRI for patients with metastatic colorectal cancer (mCRC) that is resistant to or has progressed following an oxaliplatin-containing regimen
(2) Van Cutsem, et al. JCO Oct 1, 2012:3499-3506; published online on September 4, 2012; 10.1200/JCO.2012.42.8201. (3) AUBAGIO® 14mg reduced progression of disability vs. placebo in TEMSO by-29,7% (p=0,0279) and in TOWER by 31,5% (p=0,0442).
AUBAGIO® 7mg is also available in the U.S. AUBAGIO® 7 mg has not shown a statistically significant reduction in progression of disability vs. placebo.
● A novel VEGF trap for 2L m-CRC(1)
● Significant improvement in OS demonstrated in the VELOUR study(2)
● Launch on-track with sales of €7m since late August 2012
Two New Drug Approvals Granted by FDA in Q3 2012
● Only oral MS drug to significantly reduce progression of disability in two Phase III trials(3)
● Convenience of OD oral administration to avoid the burden of regular injections
● Launched in October 2012
Several Regulatory Milestones Expected in Next 6 Months
hoFH: Homozygous Familial HypercholesterolemiaheFH: Heterozygous Familial Hypercholesterolemia 12
Lyxumia® , Kynamro™ and Lemtrada™ are registered trade names submitted to health authorities for investigational agentsZaltrap® is developed in collaboration with Regeneron, Kynamro™ with Isis Pharmaceuticals and Lyxumia® is in-licensed from Zealand PharmaGenzyme is developing Lemtrada™ in MS in collaboration with Bayer HealthCare
PDUFA: Prescription Drug User Fee Act CHMP: Committee for Medicinal Products for Human Use
Expected Milestones
CHMP Opinion: Q4 2012
Products
® MetastaticColorectal Cancer
FDA Re-Submission on track(2)
CHMP Opinion: Q2 2013Relapsing Forms ofMultiple Sclerosis
CHMP Opinion: Q4 2012PDUFA Date: Jan 29, 2013(1)
TM hoFH/severe heFH in EU and hoFH in the U.S
Targeted Indications
CHMP Opinion: Q1 2013Relapsing Forms ofMultiple Sclerosis
®
CHMP Opinion: Q4 2012FDA Submission: Dec 2012
®
Type 2 Diabetes
(1) On October 18th 2012, an FDA AdCom recommended Kynamro™ for hoFH.(2) Sanofi will make an announcement when the FDA makes a decision concerning the acceptance of the file.
DTP-HepB-Polio-Hib EU Licensure: Q2 2013New 6-in-1
Paediatric Vaccine
13
Outlook for 2012 Adjusted to Reflect YTD Performance
Tailwinds Headwinds
● Solid sales performance of our Growth Platforms, in particular Diabetes & Genzyme
● Continued discipline on costs
● Good operating margin level(1)
● Small tax rate improvement
● Generic competition against legacy blockbusters(2)
● EU austerity measures
● Global macroeconomic environment
● Copaxone® agreement terminated in early Q1 2012
2012 Business EPS to be around 12% lower than 2011 Business EPS at CER(3)
barring major unforeseen adverse events
(1) Includes a one-time payment of $80m by BMS to Sanofi for resolution of disputes related to the Avalide® supply disruption in the U.S. in 2011.(2) Mainly Plavix®, Lovenox®, Eloxatin® and Avapro® in the U.S., Plavix® and Aprovel® in Western EU, Taxotere® in the U.S. & Western EU(3) Growth is at CER (Constant Exchange Rates) from a FY 2011 Business EPS of €6.65
BUSINESS PERFORMANCE
14
Hanspeter Spek
President, Global Operations
Olivier Charmeil
Senior Vice President, Vaccines
Growth Platforms and FX More Than Compensate for Generic Competition and Copaxone®/Dermik
15
Q3 2012 sales (€m)
(1) Sales impact from end of Copaxone® agreement and Dermik disposal: -€150m
+3.3%
+ €561m- €448m
- €190m
®(1)
+ €364m
Q3 2011 Q3 2012
Sanofi Pasteur - Solid Underlying Performance in Q3 2012 Impacted by Supply Constraints
16
1,145
16
MatureMarkets
EmergingMarkets
336
1,4811,343
● Q3 2012 sales of €1,481m, up +0.7% at CER● Strong PPH vaccines sales of €320m,
up +16.0% at CER ● Strong Pentaxim® uptake in China and Mexico ● Successful launch of Imovax® Polio in Japan
in Sep 2012 with sales of €65m● Submission of a new hexavalent paediatric
vaccine in EU completed in Aug 2012
● U.S. sales of €908m, down -6.9% at CER● Supply of Flu vaccines extending into Q4 2012
unlike last year● Temporary supply limitations for Pentacel®
and TheraCys®/ImmunoCyst®
Quarterly Sales (€m)
(1) Closing of the transaction subject to certain conditions precedent and expected to occur in Q1 2013(2) World excluding USA, Canada, Western Europe (France, Germany, UK, Italy, Spain, Greece, Cyprus, Malta, Belgium, Luxembourg, Portugal,
Holland, Austria, Switzerland, Sweden, Ireland, Finland, Norway, Iceland, Denmark), Japan, Australia and New Zealand
Another Solid Quarter in Emerging Markets in Q3 2012
● Q3 2012 Emerging Markets sales of €2,821m, up +6.8% at CER
● Further reduced exposure to Western EU where austerity measures continue
● Acquisition of Genfar(1) in Colombia to expand our presence in LatAm
31.2%
33.2%
22.6%
13.0%
17
(2)
+11.3% +9.4% +1.1% +2.8%Growthat CER
Double Digit Growth of our Diabetes Franchisefor a Seventh Consecutive Quarter
Quarterly Sales (€m)
18
● Q3 2012 Diabetes sales of €1,486m, up +17.5% at CER● Continued strong performance of Lantus®, up +20.7% at CER
USA: €800m +22.1%
Emerging Markets: €204m +31.5%
Western EU: €197m +6.6%
RoW: €78m +22.8%
Q12010
Q22010
Q32010
Q42010
Q12011
Q22011
Q32011
Q42011
Q12012
Q22012
Q32012
1,279
968900
2010 2011 2012
Growthat CER
Broadening our Diabetes Platformwith New Patient Focused Solutions
19
® ● Once-daily and pronounced PPG lowering effect
● Use on top of basal insulin
● ELIXA: CV outcome study ongoing
Lyxumia® is the intended trademark for lixisenatide. Lixisenatide is currently not approved or licensed anywhere in the world.Lixisenatide was in-licensed from Zealand Pharma A/S. PPG: postprandial glucose PK/PD – Pharmacokinetic/Pharmacodynamic TD1 and TD2: Type 1 and Type 2 diabetes(1) Except for the device intended for Japan (2 steps to maintenance dose with one pen)(2) EDITION I, II, III, IV, JPI, JPII - ClinicalTrials.gov Identifier: NCT 1499082, 01499095, 01676220 & 01683266, 01689129 & 01689142
● Unique flat PK/PD profile and lower injection volume
● EDITION program: six Phase III trials currently ongoing in T1D and T2D(2)
● First state-of-the art re-usable insulin pen, manufactured by a global company in India
● For use with Sanofi’s insulin portfolio in India and possibly other Emerging Markets
NEWINSULIN GLARGINE
FORMULATION
20
665
576
356
Q3 2009 Q3 2010 Q3 2011 Q3 2012
Now a Top 3 Player in Consumer Healthcare(1)
733
(1) Source: Nicholas Hall & Company - MAT June 2012
Quarterly Sales (€m)
● Solid Q3 2012 sales of €733m, up +5.9% at CER● Strong double digit growth in Emerging Markets, up +16.1% at CER driven
by local champions (Dorflex®, NoSpa®, Lactacyd®, Enterogermina®)
● New Joint-Venture in Japan with Hisamitsu to launch OTC allergy medications
Allegra® FX
Merial Shows Steady Performance in Q3 2012
21
Q12011
Q22011
Q32011
Q42011
Q12012
Q22012
Q32012
519
● Q3 2012 sales of €519m, up +3.8% at CER ● Continued strong growth in Emerging
Markets: €140m, up +21.1% at CER
● Good sales of Heartgard®
● Increased fipronil generic competitionin the U.S. partially compensated by launch of Frontline® TRITAK
● Best-in-class business operating margin further increased to 33.6% in 9M 2012 thanks to integration synergies
470
Quarterly Sales (€m)
(1) Business operating margin of 32.2% in 9M 2012
22
An Innovative Productwith a Breakthrough Design(1)
(1) Sanofi U.S. licensed the North American commercialization rights to the epinephrine auto-injector from Intelliject, Inc.,(2) Source: 2010 American Academy of Allergy, Asthma & Immunology (AAAAI) Practice Parameters (3) Source: Mylan Form 10-K for the period ending Dec 31, 2011 and Mylan Investor Day on Feb 21, 2012(4) IMS MAT sales through July 2012
● Nearly 6 million people in the U.S. may be at risk for anaphylaxis(2)
● One main U.S. competitor with >95% market share(3): EpiPen® from Mylan ● Estimated U.S. sales of $570m(4)
● Auvi-Q™ offers a unique compact size and shape● Audio and visual cues that guide users
through the injection process
● Retractable needle mechanism
● FDA approval in Aug and U.S. launch planned in Q1 2013
FINANCIAL PERFORMANCE
Jérôme Contamine
Executive Vice President, Chief Financial Officer
23
The Patent Cliff Explains the BOI Decline in Q3 2012
€m Q3 2012 Q3 2011 % Change(reported €)
% Change(CER)
Net sales 9,040 8,753 +3.3% -3.1%
Other revenues 200 419 -52.3% -55.1%
Cost of sales (2,881) (2,755) +4.6% +0.4%
Gross profit 6,359 6,417 -0.9% -8.1%
R&D (1,149) (1,221) -5.9% -10.7%
SG&A (2,183) (2,114) +3.3% -2.7%
Other current operating income & expenses 67 40 - -
Share of Profit/Loss of associates 6 276 -97.8% -97.1%
Non controlling interests (39) (54) - -
Business operating income 3,061 3,344 -8.5% -16.7%
Business operating margin 33.9% 38.2% - -
24CER: Constant Exchange Rates
Q3 2012Q3 2011 Q3 2011
25
Loss of U.S. Exclusivity of Plavix® and Avapro® Impacted Other Revenues & Income from Associates in Q3 2012
Evolution of "Other Revenues"
Evolution of“Income from Associates"
(1) Avapro® on March 30, 2012 and Plavix® on May 17, 2012(2) Including a positive impact from a one-time payment of $80m by BMS. When excluding this payment, “Other Revenues” would have been €45m lower. (3) BNI impact calculated including a one-time payment of $80m by BMS.
Q3 2012
€419m
Loss of Exclusivity of Plavix® and Avapro® in the U.S.(1)
€276mImpact onQ3 2012
Business Net Income:
€469m(3)
€200m(2)
€6m
Q2 2012Q1 2012 Q3 2012 Q2 2012Q1 2012 Q3 2012
26
Sales and Business Operating Income Lifted Againby Favorable Currency Tailwind in Q3 2012
(1) Currency impact on sales in Q3 2012: USD / US dollar (+€354m); JPY / Japanese Yen (+€82m); CNY / Chinese Yuan (+€40m)
Quarterly Currency Impact (in % points)
+2.4%
+5.8%
+4.0%
+8.0%
€486m
€187m
€235m
€120m
+6.4%€561m
+8.2%
€277m
9M 2012+5.0% or €1,234m
Sales Business Operating Income
9M 2012+6.8% or €632m
CoS Ratio In-Line with Guidance of ~31.5% for FY 2012
Cost of Sales (%)
Q12011
Q22011
Q32011
Q42011
Q12012
Q22012
Q32012
● Relatively stable Cost of Sales (CoS) in Q3 2012: €2,881m, up +0.4% at CER
● CoS ratio slightly up in 9M 2012 vs. 9M 2011 (31.1% vs. 30.9%)reflecting:
● Product mix evolution partially compensated by productivity enhancement
● Favourable currency impact
32.0%31.5%31.0% 30.7%30.4% 30.8%
27
31.9%
(1) Cost of Sales was up +0.4% at CER
Q12011
Q22011
Q32011
Q42011
Q12012
Q22012
Q32012
13.9%
Good Control of R&D Expenses in Q3 2012
28
● Q3 2012 R&D expenses of €1,149m, down -10.7% at CERreflecting:● Good internal cost management
● Ongoing transforming initiatives
● Positive impact of a reimbursement related to a new 6-in-1 paediatric vaccine by the SPMSD JV
● R&D/Sales ratio down 0.6 points in 9M 2012 vs. 9M 2011 (13.5% vs. 14.1%)
28
R&D/Sales Ratio (%)
15.2%13.8%14.1% 14.3% 14.0%
12.7%
Q12011
Q22011
Q32011
Q42011
Q12012
Q22012
Q32012
Tight Control over G&A Expenses in Q3 2012
29
SG&A/Sales Ratio (%)● Q3 2012 SG&A expenses of €2,183m, down -2.7% at CER reflecting:
● Genzyme integration synergies
● Tight control of G&A expenses down -4.1% at CER
● SG&A/Sales ratio down 0.4 pointsin 9M 2012 vs. 9M 2011 (25.0% vs. 25.4%)
29
24.2% 26.1% 24.9%24.8%27.2%
25.8% 24.1%
Business EPS Down 14.0% at CER in Q3 2012
30
€m Q3 2012 Q3 2011 % Change(reported €)
% Change(CER)
Business operating income 3,061 3,344 -8.5% -16.7%
Net financial expenses (84) (121) - -
Income tax expense (756) (825) - -
Effective tax rate -25.1% -27.5% - -
Business net income 2,221 2,398 -7.4% -15.9%
Net margin 24.6% 27.4% - -
Business EPS 1.68 1.79 -6.1% -14.5%
Average number of shares outstanding (in million) 1,318.4 1,339.4 - -
CER: Constant Exchange Rates (1) Including a capital gain linked to the divestment of the stake in Yves Rocher
(1)
Net Debt Sep 30, 2012
Restructuring Costs & Others
+403
Dividend & Share
Repurchase
-4,312
Acquisitions & Licensing
-348
CapEx
- 991
Net Cash from Operating Activities
Net Debt Dec 31, 2011
Solid Free Cash Flow Generated in 9M 2012Despite the Loss of Exclusivity of Plavix® in the U.S.
31
(2)
(3)
In €m
-10,859-9,304
FCF+5,812
+6,803
(2)
(1) Free Cash Flow of €6,507m in 9M 2011(2) Including derivatives related to the financial debt: €456m at December 31, 2011, and €561m at September 30, 2012(3) Excluding Restructuring costs
9M 2012
● Free Cash Flow of €5,812m, down -10.7% in 9M 2012(1)
● Dividend of €3,487m paid in Q2 2012
● Share repurchases of €825m in 9M 2012
● Net debt decreased by €2,043m in Q3 2012
Business EPS Slightly Better than Anticipated in 9M 2012
As expected, 9M 2012 sales benefited from a solid performance of our Growth Platforms and from the consolidation of Genzyme for one additional quarter
Generic competition to our legacy blockbusters was as fierce as expected and EU austerity measures have somewhat intensified in 9M 2012
Continued discipline on costs as demonstrated in 9M 2012 and progressive increase in new product launch costs
Some specific items have positively impacted 9M 2012 business EPS
Performance in 9M 2012 allows us to adjust our FY 2012 guidance despite a challenging global environment
1
2
3
4
32
5
APPENDICES
R&D Pipeline
33
34
Late Stage Pipeline – Pharma & Vaccines
eliglustat tartrateGlucosylceramide synthetase inhibitor
Gaucher disease
otamixabanDirect Xa inhibitor
ACS
Quadracel®Diphtheria, tetanus, pertussis& polio vaccine; 4-6 y of age
Hexaxim™ / New hexavalent vaccineDTP-HepB-Polio-Hib vaccine
iniparib (BSI-201)Squamous NSCLC (1L)
lixisenatide GLP-1 agonist
Type 2 diabetes, U.S.
VaxiGrip® QIV IMQuadrivalent inactivated
influenza vaccine
Fluzone® QIV IMQuadrivalent inactivated
influenza vaccine
ombrabulinVascular disrupting agent
Soft tissue sarcoma (2L/3L)
Insulin glargineNew formulation
Type 1+2 diabetes
Aubagio® (teriflunomide)Relapsing forms of Multiple sclerosis
(RMS) – Monotherapy, EU
SAR302503 (TG101348)JAK-2 inhibitor
Myelofibrosis (1L)
mipomersenApolipoprotein B-100 antisense
Severe HeFH, U.S.
alemtuzumab Anti-CD52 mAb
Multiple sclerosis, EU
Jevtana® (cabazitaxel) Metastatic prostate cancer (1L)
SAR236553Anti-PCSK-9 mAb
Hypercholesterolemia
Allegra®
fexofenadineDry syrup, Japan
SYNVISC-ONE™Medical device Pain in hip OA
sarilumab (SAR153191)Anti-IL-6R mAb
Rheumatoid arthritis
mipomersenApolipoprotein B-100 antisenseHoFH and severe HeFH in EU;
HoFH in U.S.
MACI®Cell-based treatment
Articular cartilage defects
DengueMild-to-severe
dengue fever vaccine
lixisenatideGLP-1 agonist
Type 2 diabetes, EU / Japan
Aubagio® (teriflunomide)Multiple sclerosis Adjunct therapy
DTP-HepB-Polio-HibPediatric hexavalent vaccine
Zaltrap® (aflibercept)VEGF-Trap
2nd line mCRC, EU
RegistrationPhase III
N
N
N
N
N
N
34
N
N N
N
N New Molecular EntityCentral Nervous System
Genetic diseases
OncologyMetabolic Disorders
VaccinesInternal Medicine
Biosurgery
Thrombosis
AgingOphthalmology
N
Early Stage Pipeline – Pharma & Vaccines
iniparib (BSI-201)Platinum-resistant ovarian cancer (2L)
FOV1101FDC prednisolone/cyclosporine
Allergic conjunctivitis
SAR231893Anti-IL4 mAb
Asthma; Atopic dermatitis
SAR3419Maytansin-loaded anti-CD19 mAb
B-cell malignancies refractory/relapsed (NHL, ALL)
SAR292833 (GRC15300)TRPV3 antagonist
Neuropathic pain, osteoarthritic pain
ferroquineAntimalarial
Malaria
SAR256212 (MM121) anti-ErbB3 mAb
Breast cancer (2L, 3L)
SAR110894H3 antagonist
Alzheimer's disease
fresolimumabTGFβ antagonist
Fibrosis
SAR245408 (XL147)Oral PI3K inhibitor
Endometrial cancer (2L)
SAR113945IKK-β inhibitorOsteoarthritis
SAR97276Antimalarial
Malaria
SAR245409 (XL765)Oral dual inhibitor of PI3K & mTOR
Non-Hodgkin lymphoma
Meninge ACYW conj.2nd generation meningococcal
Conjugate infant vaccine
SAR279356 (F598)Anti-PNAG mAb
Serious infections
ombrabulinVascular disrupting agent
Ovarian cancer (2L)
ACAM-CdiffClostridium difficile
Toxoid vaccine
SAR339658VLA 2 antagonist
Inflammatory bowel disease
SAR302503 (TG101348)JAK-2 inhibitor
Polycythemia vera (2L)Incyte (ruxolitinib) resistant/intolerant MF
Rabies VRVgPurified vero rabies vaccine
SAR156597IL4/IL13 Bi-specific mAb
Idiopathic pulmonary fibrosis
Jevtana® (cabazitaxel) Small cell lung cancer (2L)
Phase II
N
N
N
N
N
N
N
N
N
N N
N
N
3535
N New Molecular EntityCentral Nervous System
Genetic diseases
OncologyMetabolic Disorders
VaccinesInternal Medicine
Biosurgery
Thrombosis
AgingOphthalmology
N
N
36
Early Stage Pipeline – Pharma & Vaccines
SAR153192Anti-DLL4 mAb
Solid tumors
SAR405838 (MI-773)HDM2 / p53 antagonist
Solid tumors and hematological malignancies
SAR252067Anti-LIGHT mAb
Crohn’s disease & Ulcerative colitis
RotavirusLive Attenuated Tetravalent
Rotavirus oral vaccine
GZ402674Non-camptothecin topo1 inhibitor
Solid tumors
SAR260301PI3K β selective
PTEN – Deficient tumors
SAR100842LPA-1/LPA-3
Skin manifestation of scleroderma
Streptococcus pneumoniaMeningitis & pneumonia vaccine
SAR650984Anti-CD38 naked mAb
Hematological malignancies
SAR127963P75 receptor antagonist
Trauma brain injury
SAR113244Anti-CXCRS mAb
Systemic lupus erythematosus
Pseudomonas aeruginosaAntibody fragment product
Prevention of ventilator-associated pneumonia
SAR566658Maytansin-loaded anti-DS6 mAb
DS6 positive solid tumors
GZ404477(AAV-hAADC)Gene therapy
Parkinson's disease
SAR407899Rho kinase inhibitor
Diabetic nephropathy
Tuberculosis Recombinant subunit vaccine
SAR307746Anti-Ang2 mAb
Solid tumors
SAR391786Rehabilitation post orthopedic surgery
lixisenatide + Lantus®
GLP-1 agonist + insulin glargineFix-Flex / Type 2 diabetes
RetinoStat®
Gene therapy Wet age-related macular degeneration (AMD)
SAR125844C-Met kinase inhibitor
Solid tumors
SAR228810Anti-protofibrillar AB mAb
Alzheimer’s disease
SAR164653Cathepsin A inhibitor
CV-related complications & deaths in diabetic patients
StarGen®
Gene therapyStargardt disease
CombinationsSAR245409 / MSC1936369B
SAR245408/SAR256212 (MM121)Solid tumors
SAR399063DHA-GLP + vit DPre-sarcopenia
GZ402665(rhASM)
Niemann-Pick type B
GZ402663 (sFLT-01)Gene therapy
Age-related macular degeneration(AMD)
SAR393590 (Oral clofaribine)DNA synthesis inhibitor
Hematological malignancies
SAR404460DHA-GPL + Vit DPre-sarcopenia
GZ402671GCS InhibitorFabry Disease
UshStat®
Gene therapyUsher syndrome 1B
Jevtana® (cabazitaxel) Gastric cancer (2L)
SAR126119TAFIa inhibitor
Acute ischemic stroke
Phase IN
N
N
N
NN
N
N N
N
N
N N
36
NN
N
N
N
N
N New Molecular EntityCentral Nervous System
Genetic diseases
OncologyMetabolic Disorders
VaccinesInternal Medicine
Biosurgery
Thrombosis
AgingOphthalmology
N
NN
N
N
N
N
37
Phase I Phase II Phase III Registration TOTAL
Oncology 8 4 3 0 15
Metabolic Disorders 2 0 1 2 5
Thrombosis 1 0 1 0 2
Central Nervous System 2 0 0 2 4
Internal Medicine 3 7 1 0 11
Ophthalmology 4 1 0 0 5
Genetic Diseases 2 0 1 0 3
Aging 4 3 0 0 7
Vaccines 4 3 4 2 13
TOTAL 30 18 11 6
R&D Pipeline Summary TableNew Molecular Entities (NMEs) and Vaccines
48 17NMEs & Vaccines
65
37
52
38
Expected R&D Milestones – Pharmaceuticals
38
Product Event TimingZaltrap® (aflibercept) Expected CHMP decision in 2nd line mCRC in EU Q4 2012
Lyxumia® (lixisenatide) Expected CHMP decision in type 2 diabetes in EU Q4 2012
Kynamro™ (mipomersen) Expected CHMP decision in hoFH and severe heFH in EU Q4 2012
ombrabulin Phase III headline results in sarcoma Q4 2012
anti-PCSK9 mAb Expected start of CV morbi/mortality Phase III (ODYSSEY program) Nov 2012
Lyxumia® (lixisenatide) Expected FDA submission in type 2 diabetes in U.S. Dec 2012
AubagioTM (teriflunomide) Expected CHMP decision in RMS in EU Q1 2013
Kynamro™ (mipomersen) Expected FDA decision in hoFH in the U.S. Q1 2013
eliglustat tartrate Phase III headline results in Gaucher disease (ENCORE) Q1 2013
Lemtrada™ (alemtuzumab) Expected CHMP decision in RMS in EU Q2 2013
iniparib Phase III headline results in 1st line squamous NSCLC Q2 2013
otamixaban Phase III headline results in ACS Q2 2013
JAK2 inhibitor Phase III headline results in myelofibrosis Q2 2013
39
Expected R&D Milestones – Vaccines
39
Product Event TimingFluzone® QIV ID Expected start of Phase III study Q4 2012
Vaxigrip® QIV IM Expected submission of regulatory file in EU Q1 2013
Fluzone® QIV IM Expected licensure in the U.S. Q2 2013
6-in-1 paediatric vaccine Expected licensure in EU Q2 2013
ACAM-Cdiff Expected start of Phase III study Q3 2013
APPENDICES
FINANCE
40
Business Net Income Statement
* Net of tax** Determined on the basis of Business income before tax, associates, and non‐controlling interests*** Based on an average number of shares outstanding of 1,318.4 million in the third quarter of 2012 and 1,339.4 million in the third quarter of 2011
Third quarter 2012
Net sales 7,040 6,940 1.4% 1,481 1,343 10.3% 519 470 10.4% 9,040 8,753 3.3%Other revenues 184 406 (54.7%) 7 8 (12.5%) 9 5 80.0% 200 419 (52.3%)Cost of sales (2,133) (2,094) 1.9% (578) (502) 15.1% (170) (159) 6.9% (2,881) (2,755) 4.6%As % of net sales (30.3%) (30.2%) (39.1%) (37.4%) (32.7%) (33.9%) (31.9%) (31.5%)Gross profit 5,091 5,252 (3.1%) 910 849 7.2% 358 316 13.3% 6,359 6,417 (0.9%)As % of net sales 72.3% 75.7% 61.4% 63.2% 69.0% 67.2% 70.3% 73.3%Research and development expenses
(1,016) (1,031) (1.5%) (97) (154) (37.0%) (36) (36) 0.0% (1,149) (1,221) (5.9%)
As % of net sales (14.4%) (14.9%) (6.5%) (11.5%) (6.9%) (7.7%) (12.7%) (13.9%)Selling and general expenses
(1,874) (1,827) 2.6% (153) (140) 9.3% (156) (147) 6.1% (2,183) (2,114) 3.3%
As % of net sales (26.6%) (26.3%) (10.3%) (10.4%) (30.1%) (31.2%) (24.1%) (24.2%)Other current operating income/expenses
58 (1) (2) 2 7 (4) 4 43 67 40
Share of profit/loss of associates*
10 269 (4) 7 6 276
Net income attributable to non-controlling interests
(39) (55) 1 (39) (54)
Business operating income 2,230 2,607 (14.5%) 654 564 16.0% 173 130 33.1% 4 43 3,061 3,344 (8.5%)
As % of net sales 31.7% 37.6% 44.2% 42.0% 33.3% 27.7% 33.9% 38.2%Financial income and expenses (84) (121)
Income tax expense (756) (825)
Tax rate** 25.1% 27.5%Business net income 2,221 2,398 (7.4%)As % of net sales 24.6% 27.4%Business earnings per share*** (in euros) 1.68 1.79 (6.1%)
Group Total
Millions of euros Q3 2012 Q3 2011 Q3 2011 % changeQ3 2012 Q3 2012 Q3 2011Q3 2011
Pharmaceuticals
% change
Vaccines Animal health
Q3 2012 Q3 2011
Other
% change Q3 2012% change
Business Net Income Statement
* Net of tax** Determined on the basis of Business income before tax, associates, and non‐controlling interests*** Based on an average number of shares outstanding of 1,319 million in the first nine months of 2012 and 1,318.9 million in the first nine months of 2011
Nine months 2012
Net sales 21,867 20,670 5.8% 2,881 2,651 8.7% 1,673 1,560 7.2% 26,421 24,881 6.2%Other revenues 829 1,222 (32.2%) 17 18 (5.6%) 27 14 92.9% 873 1,254 (30.4%)Cost of sales (6,564) (6,167) 6.4% (1,144) (1,052) 8.7% (516) (486) 6.2% (8,224) (7,705) 6.7%As % of net sales (30.0%) (29.8%) (39.7%) (39.7%) (30.8%) (31.2%) (31.1%) (30.9%)Gross profit 16,132 15,725 2.6% 1,754 1,617 8.5% 1,184 1,088 8.8% 19,070 18,430 3.5%As % of net sales 73.8% 76.1% 60.9% 61.0% 70.8% 69.7% 72.2% 74.1%Research and development expenses
(3,067) (2,994) 2.4% (381) (418) (8.9%) (116) (106) 9.4% (3,564) (3,518) 1.3%
As % of net sales (14.0%) (14.5%) (13.2%) (15.8%) (6.9%) (6.8%) (13.5%) (14.1%)Selling and general expenses
(5,637) (5,441) 3.6% (441) (404) 9.2% (514) (469) 9.6% (1) (1) (6,593) (6,315) 4.4%
As % of net sales (25.8%) (26.3%) (15.3%) (15.2%) (30.7%) (30.1%) (25.0%) (25.4%)Other current operating income/expenses
37 41 (3) 1 8 (11) 20 32 62 63
Share of profit/loss of associates*
435 828 (10) 5 13 425 846
Net income attributable to non-controlling interests
(143) (191) 1 (143) (190)
Business operating income
7,757 7,968 (2.6%) 919 801 14.7% 562 503 11.7% 19 44 9,257 9,316 (0.6%)
As % of net sales 35.5% 38.5% 31.9% 30.2% 33.6% 32.2% 35.0% 37.4%Financial income and expenses (311) (299)
Income tax expense (2,339) (2,299)
Tax rate** 27.0% 27.5%Business net income 6,607 6,718 (1.7%)As % of net sales 25.0% 27.0%Business earnings per share*** (in euros) 5.01 5.09 (1.6%)
9M 2012 9M 2011 9M 2012% change % change9M 2012 9M 2012 9M 20119M 2011
Other
% change
Vaccines Animal health Group Total
Millions of euros 9M 2012 9M 2011 9M 2011
Pharmaceuticals
% change
4343
Reconciliation of Business Net Income to Consolidated Net Income Attributable to Equity Holders of sanofi
Millions of euros Q3 2012 Q3 2011 % changeBusiness net income 2,221 2,398 (7.4%)Amortization of intangible assets (816) (804)
Impairment of intangible assets 12 (7)
Fair value remeasurement of contingent consideration liabilities (86) 233
Expenses arising from the impact of acquisitions on inventories (3) (140)
Restructuring costs (57) (70)
Other gains and losses, and litigation
Tax effect of: 294 427
amortization of intangible assets 277 354 impairment of intangible assets (4) 2 fair value remeasurement of contingent consideration liabilities 3 5 expenses arising on the workdown of acquired inventories 1 42 restructuring costs 17 24 other gains and losses, and litigation
Share of items listed above attributable to non-controlling interests 1
Restructuring costs of associates and joint ventures, and expenses arising from the impact of acquisitions on associates and joint ventures (7) (7)
Net income attributable to equity holders of sanofi 1,559 2,030 (23.2%)Consolidated earnings per share (in euros) 1.18 1.52 (22.4%)
4444
Reconciliation of Business Net Income to Consolidated Net Income Attributable to Equity Holders of sanofi
Millions of euros 9M 2012 9M 2011 % changeBusiness net income 6,607 6,718 (1.7%)Amortization of intangible assets (2,491) (2,505)
Impairment of intangible assets (28) (76)
Fair value remeasurement of contingent consideration liabilities (192) 167
Expenses arising from the impact of acquisitions on inventories (20) (404)
Restructuring costs (307) (537)
Other gains and losses, and litigation (517)
Tax effect of: 1,008 1,429
amortization of intangible assets 892 913 impairment of intangible assets 10 22 fair value remeasurement of contingent consideration liabilities 6 10 expenses arising on the workdown of acquired inventories 6 120 restructuring costs 94 174 other gains and losses, and litigation 190
Share of items listed above attributable to non-controlling interests 2
Restructuring costs of associates and joint ventures, and expenses arising from the impact of acquisitions on associates and joint ventures (22) (21)
Net income attributable to equity holders of sanofi 4,557 4,254 7.1%Consolidated earnings per share (in euros) 3.45 3.23 6.8%
Consolidated Income Statements
€ million
Net sales 9,040 8,753 26,421 24,881
Other revenues 200 419 873 1,254
Cost of sales (2,884) (2,895) (8,244) (8,109)
Gross profit 6,356 6,277 19,050 18,026
Research and development expenses (1,149) (1,221) (3,564) (3,518)
Selling and general expenses (2,183) (2,114) (6,593) (6,315)
Other operating income 117 90 436 281
Other operating expenses (50) (50) (374) (218)
Amortization of intangible assets (816) (804) (2,491) (2,505)
Impairment of intangible assets 12 (7) (28) (76)
Fair value remeasurement of contingent consideration liabilities (86) 233 (192) 167
Restructuring costs (57) (70) (307) (537)
Other gains and losses, and litigation (517)
Operating income 2,144 2,334 5,937 4,788
Q3 2011Q3 2012 9M 20119M 2012
Consolidated Income Statements
€ million
Operating income 2,144 2,334 5,937 4,788
Financial expenses (135) (153) (407) (387)
Financial income 51 32 96 88Income before tax and associates and joint ventures 2,060 2,213 5,626 4,489
Income tax expense (462) (398) (1,331) (870)Share of profit / loss of associates and joint ventures (1) 269 403 825
Net income 1,597 2,084 4,698 4,444
Net income attributable to non-controlling interests 38 54 141 190
Net income attributable to equity holders of sanofi 1,559 2,030 4,557 4,254
Average number of shares outstanding (million) 1,318.4 1,339.4 1,319.0 1,318.9
Consolidated earnings per share (in euros) 1.18 1.52 3.45 3.23
Q3 2011Q3 2012 9M 20119M 2012