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Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
Q3 2012 Results
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Q3 2012 Results

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Q3 2012 Results

Q3 2012 Results

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  • 1. 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 of 1995, as amended. Forward-looking statements are statements that are not historical facts. These statements include projections and estimates and their underlying assumptions, statements regarding plans, objectives, intentions and expectations 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 Sanofis management believes that the expectations reflected in such forward-looking statements are reasonable, investors are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of Sanofi, that could cause actual results and developments to differ 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 the EMA, regarding whether and when to approve any drug, device or biological application that may be filed for any such product candidates as well as their decisions regarding labeling and other matters that could affect the availability or commercial potential of such product candidates, the absence of guarantee that the product candidates if approved will be commercially successful, the future approval and commercial success of therapeutic alternatives, the Groups ability to benefit from external growth opportunities, trends in exchange rates and prevailing interest rates, the impact of cost containment policies and subsequent changes thereto, the average number of shares outstanding as well as those discussed 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 Sanofis annual report on Form 20-F for the year ended December 31, 2011. Other than as required by applicable law, Sanofi does not undertake any obligation to update or revise any forward-looking information or statements. 2
  • 3. Agenda 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 3
  • 4. KEY HIGHLIGHTSChristopher A. ViehbacherChief Executive Officer 4
  • 5. Generic Competition to Legacy Blockbusters (1)Impacted Sales Evolution in Q3 2012 Quarterly Sales (€m) YTD Sales (€m) €26,421m €24,881m €9,040m €8,753m -3.1% +1.2% at CER(2) at CER(2) Q3 2011 Q3 2012 YTD 2011 YTD 2012 (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
  • 6. Q3 2012 Business EPS Decline Reflectsthe Loss of Exclusivity of Plavix® and Avapro® in the U.S. Quarterly Business EPS (€) YTD Business EPS (€) €5.09 €5.01 €1.79 €1.68 -14.5% -8.4% at CER(1) at CER(1) Q3 2011 Q3 2012 YTD 2011 YTD 2012 (1) On a reported basis, Q3 2012 Business EPS was down -6.1% and YTD 2012 Business EPS was down -1.6%. 6
  • 7. Growth Platforms Represent Over 70% of Sales (1) Key Genericized Products Sales Growth Platforms Sales (€m and % of Total Sales) (€m and % of Total Sales) €6,412m €5,753m €5,381m €3,339m 70.9% of Total €2,207m 4.4% Sales of Total Sales €813m €752m €399m Q2 Q1 Q2 Q3 Q2 Q1 Q2 Q3 2009 2012 2009 2012 (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
  • 8. Growth Platforms Grew by +6.4% in Q3 2012 Growth at CER Emerging Markets €2,821m +6.8% Diabetes Solutions €1,486m +17.5% Vaccines €1,481m +0.7% Consumer Health Care €733m +5.9% Animal Health €519m +3.8% New Genzyme(1) €470m +22.5% Innovative Products(2) €154m +7.6% (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® 8
  • 9. Genzyme Delivered Strong Performance in Q3 2012 Quarterly Sales (€m) ● Q3 2012 rare diseases sales 163 reached €470m, up +22.5% at CER 141 ● Strong rebound of Fabrazyme® 116 101 benefiting from: 87 ● Supply from new Framingham plant ● Shire’s withdrawal of Replagal® BLA 32 in the U.S. earlier this year ● Cerezyme® and Myozyme® growing Q3 Q3 Q3 Q3 Q3 Q3 at high-single digit rate at CER 2011 2012 2011 2012 2011 2012 & (1) BLA: Biologics License Application 9
  • 10. Eliglustat - A Novel Oral Therapy in Gaucher Disease (1) ● Potent, novel substrate inhibitor Change in Spleen Volume (% change at 9 months) ● Oral therapy ● Eliminating challenges of infusions +2% Eliglustat ● Positive results from ENGAGE, Placebo first Phase III study (vs. placebo) ● Primary endpoint and all secondary endpoints met ● Well tolerated with no serious 30% adverse events reported Absolute  ● ENCORE Phase III results (vs. Difference Cerezyme®) expected in early 2013 -28% (1) Eliglustat tartrate is an investigational drug (2) Secondary endpoints included improvements in hemoglobin levels and platelet levels, as well as liver volumes 10
  • 11. Two New Drug Approvals Granted by FDA in Q3 2012 ● Only oral MS drug to significantly ● A novel VEGF trap for 2L m-CRC(1) reduce progression of disability in ● Significant improvement in OS two Phase III trials(3) demonstrated in the VELOUR study(2) ● Convenience of OD oral administration ● Launch on-track with sales of €7m to avoid the burden of regular injections since late August 2012 ● Launched in October 2012 (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. 11
  • 12. Several Regulatory Milestones Expected in Next 6 Months Products Targeted Indications Expected Milestones ® Metastatic CHMP Opinion: Q4 2012 Colorectal Cancer ® CHMP Opinion: Q4 2012 Type 2 Diabetes FDA Submission: Dec 2012 TM hoFH/severe heFH in EU CHMP Opinion: Q4 2012 and hoFH in the U.S PDUFA Date: Jan 29, 2013(1) ® Relapsing Forms of CHMP Opinion: Q1 2013 Multiple Sclerosis Relapsing Forms of FDA Re-Submission on track(2) Multiple Sclerosis CHMP Opinion: Q2 2013 New 6-in-1 DTP-HepB-Polio-Hib EU Licensure: Q2 2013 Paediatric Vaccine (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. Lyxumia® , Kynamro™ and Lemtrada™ are registered trade names submitted to health authorities for investigational agents Zaltrap® is developed in collaboration with Regeneron, Kynamro™ with Isis Pharmaceuticals and Lyxumia® is in-licensed from Zealand Pharma Genzyme is developing Lemtrada™ in MS in collaboration with Bayer HealthCare hoFH: Homozygous Familial Hypercholesterolemia PDUFA: Prescription Drug User Fee Act 12 heFH: Heterozygous Familial Hypercholesterolemia CHMP: Committee for Medicinal Products for Human Use
  • 13. Outlook for 2012 Adjusted to Reflect YTD Performance Tailwinds Headwinds ● Solid sales performance ● Generic competition of our Growth Platforms, against legacy blockbusters(2) in particular Diabetes & Genzyme ● EU austerity measures ● Continued discipline on costs ● Global macroeconomic ● Good operating margin level(1) environment ● Small tax rate improvement ● Copaxone® agreement terminated in early Q1 20122012 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 13
  • 14. BUSINESS PERFORMANCEHanspeter SpekPresident, Global OperationsOlivier CharmeilSenior Vice President, Vaccines 14
  • 15. Growth Platforms and FX More Than Compensatefor Generic Competition and Copaxone®/Dermik Q3 2012 sales (€m) +3.3% + €561m - €448m + €364m - €190m ® (1) (1) Sales impact from end of Copaxone® agreement and Dermik disposal: -€150m 15
  • 16. Sanofi Pasteur - Solid Underlying Performance in Q3 2012Impacted by Supply Constraints ● Q3 2012 sales of €1,481m, up +0.7% at CER Quarterly Sales (€m) ● Strong PPH vaccines sales of €320m, 1,481 up +16.0% at CER 1,343 Emerging Markets ● Strong Pentaxim® uptake in China and Mexico 336 ● Successful launch of Imovax® Polio in Japan in Sep 2012 with sales of €65m ● Submission of a new hexavalent paediatric Mature vaccine in EU completed in Aug 2012 Markets 1,145 ● 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® Q3 2011 Q3 2012 16
  • 17. 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 13.0% 22.6% (2) 31.2% 33.2% Growth +11.3% +9.4% +1.1% +2.8% at CER (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 17
  • 18. Double Digit Growth of our Diabetes Franchisefor a Seventh Consecutive Quarter ● Q3 2012 Diabetes sales of €1,486m, up +17.5% at CER ● Continued strong performance of Lantus®, up +20.7% at CER Quarterly Sales (€m) 1,279 Growth at CER 900 968 USA: €800m +22.1% Emerging Markets: €204m +31.5% Western EU: €197m +6.6% RoW: €78m +22.8% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2010 2010 2010 2010 2011 2011 2011 2011 2012 2012 2012 2010 2011 2012 18
  • 19. Broadening our Diabetes Platformwith New Patient Focused Solutions ® ● Once-daily and pronounced PPG lowering effect ● Use on top of basal insulin ● ELIXA: CV outcome study ongoing NEW ● Unique flat PK/PD profile and lower injection volume INSULIN GLARGINE FORMULATION ● 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 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 19
  • 20. Now a Top 3 Player in Consumer Healthcare (1) ● 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 Quarterly Sales (€m) 733 665 576 356 Q3 2009 Q3 2010 Q3 2011 Q3 2012 Allegra® FX (1) Source: Nicholas Hall & Company - MAT June 2012 20
  • 21. Merial Shows Steady Performance in Q3 2012 ● Q3 2012 sales of €519m, up +3.8% Quarterly Sales (€m) at CER ● Continued strong growth in Emerging 519 Markets: €140m, up +21.1% at CER 470 ● Good sales of Heartgard® ● Increased fipronil generic competition in 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 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2011 2011 2012 2012 2012 (1) Business operating margin of 32.2% in 9M 2012 21
  • 22. An Innovative Product with a Breakthrough Design(1)● 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 (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 22
  • 23. FINANCIAL PERFORMANCEJérôme ContamineExecutive Vice President, Chief Financial Officer 23
  • 24. The Patent Cliff Explains the BOI Decline in Q3 2012€m Q3 2012 Q3 2011 % Change % Change (reported €) (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% - - CER: Constant Exchange Rates 24
  • 25. Loss of U.S. Exclusivity of Plavix® and Avapro® ImpactedOther Revenues & Income from Associates in Q3 2012 Loss of Exclusivity of Plavix® and Avapro® in the U.S.(1) Evolution of Evolution of "Other Revenues" “Income from Associates" €419m Impact on €276m Q3 2012 Business Net (2) €200m Income: (3) €469m €6m Q3 2011 Q3 2012 Q3 2011 Q3 2012 (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. 25
  • 26. Sales and Business Operating Income Lifted Againby Favorable Currency Tailwind in Q3 2012 Quarterly Currency Impact (in % points) Sales Business Operating Income 9M 2012 9M 2012 +5.0% or €1,234m +6.8% or €632m +8.0% +8.2% €235m €277m +6.4% +5.8% €561m €486m +4.0% €120m +2.4% €187m Q1 2012 Q2 2012 Q3 2012 Q1 2012 Q2 2012 Q3 2012 (1) Currency impact on sales in Q3 2012: USD / US dollar (+€354m); JPY / Japanese Yen (+€82m); CNY / Chinese Yuan (+€40m) 26
  • 27. CoS Ratio In-Line with Guidance of ~31.5% for FY 2012 ● Relatively stable Cost of Sales Cost of Sales (%) (CoS) in Q3 2012: €2,881m, up +0.4% at CER 30.4% 31.0% 31.5% 32.0% 30.7% 30.8% 31.9% ● 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 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2011 2011 2012 2012 2012 (1) Cost of Sales was up +0.4% at CER 27
  • 28. Good Control of R&D Expenses in Q3 2012 ● Q3 2012 R&D expenses of R&D/Sales Ratio (%) €1,149m, down -10.7% at CER reflecting: 14.1% 14.3% 13.9% 15.2% 13.8% 14.0% 12.7% ● 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%) Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2011 2011 2012 2012 2012 28
  • 29. Tight Control over G&A Expenses in Q3 2012 ● Q3 2012 SG&A expenses of SG&A/Sales Ratio (%) €2,183m, down -2.7% at CER reflecting: 27.2% 26.1% 24.8% 24.2% 24.9% 25.8% 24.1% ● Genzyme integration synergies ● Tight control of G&A expenses down -4.1% at CER ● SG&A/Sales ratio down 0.4 points in 9M 2012 vs. 9M 2011 (25.0% vs. 25.4%) Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2011 2011 2012 2012 2012 29
  • 30. Business EPS Down 14.0% at CER in Q3 2012€m Q3 2012 Q3 2011 % Change % Change (reported €) (CER)Business operating income 3,061 3,344 -8.5% -16.7%Net financial expenses (84) (1) (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 30
  • 31. Solid Free Cash Flow Generated in 9M 2012Despite the Loss of Exclusivity of Plavix® in the U.S. In €m 9M 2012 ● Free Cash Flow of €5,812m, down -10.7% in 9M 2012(1) - 991 ● Dividend of €3,487m paid in Q2 2012 -348 -9,304 -10,859 ● Share repurchases of €825m in 9M 2012 +6,803 -4,312 ● Net debt decreased FCF +5,812 by €2,043m in Q3 2012 +403 Net Debt(2) Net Cash from CapEx Acquisitions Dividend & Restructuring Net Debt(2) Dec 31, 2011 Operating & Licensing Share Costs & Sep 30, 2012 Activities (3) Repurchase Others (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 31
  • 32. Business EPS Slightly Better than Anticipated in 9M 2012 1 As expected, 9M 2012 sales benefited from a solid performance of our Growth Platforms and from the consolidation of Genzyme for one additional quarter 2 Generic competition to our legacy blockbusters was as fierce as expected and EU austerity measures have somewhat intensified in 9M 2012 3 Continued discipline on costs as demonstrated in 9M 2012 and progressive increase in new product launch costs 4 Some specific items have positively impacted 9M 2012 business EPS 5 Performance in 9M 2012 allows us to adjust our FY 2012 guidance despite a challenging global environment 32
  • 33. APPENDICESR&D Pipeline 33
  • 34. Late Stage Pipeline – Pharma & Vaccines Phase III Registration eliglustat tartrate N otamixaban N Quadracel® Hexaxim™ / New hexavalent vaccineGlucosylceramide synthetase inhibitor Direct Xa inhibitor Diphtheria, tetanus, pertussis DTP-HepB-Polio-Hib vaccine Gaucher disease ACS & polio vaccine; 4-6 y of age N lixisenatide VaxiGrip® QIV IM Fluzone® QIV IM iniparib (BSI-201) GLP-1 agonist Quadrivalent inactivated Quadrivalent inactivated Squamous NSCLC (1L) influenza vaccine Type 2 diabetes, U.S. influenza vaccine ombrabulin N Insulin glargine Aubagio® (teriflunomide) N Vascular disrupting agent New formulation Relapsing forms of Multiple sclerosis Soft tissue sarcoma (2L/3L) Type 1+2 diabetes (RMS) – Monotherapy, EU SAR302503 (TG101348) N mipomersen alemtuzumab N JAK-2 inhibitor Apolipoprotein B-100 antisense Anti-CD52 mAb Myelofibrosis (1L) Severe HeFH, U.S. Multiple sclerosis, EU SAR236553 N Allegra® Jevtana® (cabazitaxel) Anti-PCSK-9 mAb fexofenadine Metastatic prostate cancer (1L) Hypercholesterolemia Dry syrup, Japan N mipomersen N SYNVISC-ONE™ sarilumab (SAR153191) Apolipoprotein B-100 antisense Medical device Anti-IL-6R mAb HoFH and severe HeFH in EU; Pain in hip OA Rheumatoid arthritis HoFH in U.S. MACI® Dengue lixisenatide N Cell-based treatment Mild-to-severe GLP-1 agonist Articular cartilage defects dengue fever vaccine Type 2 diabetes, EU / Japan Aubagio® (teriflunomide) Zaltrap® (aflibercept) DTP-HepB-Polio-Hib Multiple sclerosis VEGF-Trap Pediatric hexavalent vaccine Adjunct therapy 2nd line mCRC, EU N New Molecular Entity Oncology Thrombosis Vaccines Metabolic Disorders Central Nervous System Internal Medicine Ophthalmology Genetic diseases Biosurgery Aging 34
  • 35. Early Stage Pipeline – Pharma & Vaccines Phase II FOV1101 N SAR231893 N iniparib (BSI-201) FDC prednisolone/cyclosporine Anti-IL4 mAb Platinum-resistant ovarian cancer (2L) Allergic conjunctivitis Asthma; Atopic dermatitis SAR3419 N N N SAR292833 (GRC15300) ferroquine Maytansin-loaded anti-CD19 mAb TRPV3 antagonist Antimalarial B-cell malignancies refractory/relapsed Neuropathic pain, osteoarthritic pain Malaria (NHL, ALL) SAR256212 (MM121) N SAR110894 N fresolimumab N anti-ErbB3 mAb H3 antagonist TGFβ antagonist Breast cancer (2L, 3L) Alzheimers disease Fibrosis SAR245408 (XL147) N SAR113945 N SAR97276 N Oral PI3K inhibitor IKK-β inhibitor Antimalarial Endometrial cancer (2L) Osteoarthritis Malaria SAR245409 (XL765) N Meninge ACYW conj. SAR279356 (F598) N Oral dual inhibitor of PI3K & mTOR 2ndgeneration meningococcal Anti-PNAG mAb Non-Hodgkin lymphoma Conjugate infant vaccine Serious infections ombrabulin ACAM-Cdiff SAR339658 N Vascular disrupting agent Clostridium difficile VLA 2 antagonist Ovarian cancer (2L) Toxoid vaccine Inflammatory bowel disease SAR302503 (TG101348) SAR156597 N JAK-2 inhibitor Rabies VRVg IL4/IL13 Bi-specific mAb Polycythemia vera (2L) Purified vero rabies vaccine Incyte (ruxolitinib) resistant/intolerant MF Idiopathic pulmonary fibrosis Jevtana® (cabazitaxel) Small cell lung cancer (2L) N New Molecular Entity Oncology Thrombosis Vaccines Metabolic Disorders Central Nervous System Internal Medicine Ophthalmology Genetic diseases Biosurgery Aging 35
  • 36. Early Stage Pipeline – Pharma & Vaccines Phase I SAR153192 N SAR405838 (MI-773) N SAR252067 N Rotavirus Anti-DLL4 mAb HDM2 / p53 antagonist Anti-LIGHT mAb Live Attenuated Tetravalent Solid tumors Solid tumors and hematological malignancies Crohn’s disease & Ulcerative colitis Rotavirus oral vaccine GZ402674 N SAR260301 N SAR100842 N Streptococcus pneumonia Non-camptothecin topo1 inhibitor PI3K β selective LPA-1/LPA-3 Meningitis & pneumonia vaccine Solid tumors PTEN – Deficient tumors Skin manifestation of scleroderma N N N SAR650984 SAR127963 SAR113244 Pseudomonas aeruginosa Anti-CD38 naked mAb P75 receptor antagonist Anti-CXCRS mAb Antibody fragment product Hematological malignancies Trauma brain injury Systemic lupus erythematosus Prevention of ventilator-associated pneumonia N GZ404477 N N SAR566658 SAR407899 (AAV-hAADC) Tuberculosis Maytansin-loaded anti-DS6 mAb Rho kinase inhibitor Gene therapy Recombinant subunit vaccine DS6 positive solid tumors Diabetic nephropathy Parkinsons disease SAR307746 N N lixisenatide + Lantus® RetinoStat® N SAR391786 Anti-Ang2 mAb GLP-1 agonist + insulin glargine Gene therapy Rehabilitation post orthopedic surgery Solid tumors Fix-Flex / Type 2 diabetes Wet age-related macular degeneration (AMD) SAR125844 N N SAR164653 N N SAR228810 StarGen® Cathepsin A inhibitor C-Met kinase inhibitor Anti-protofibrillar AB mAb CV-related complications & deaths in Gene therapy Solid tumors Alzheimer’s disease Stargardt disease diabetic patients Combinations N GZ402665 N GZ402663 (sFLT-01) N SAR399063 SAR245409 / MSC1936369B Gene therapy SAR245408/SAR256212 (MM121) DHA-GLP + vit D (rhASM) Age-related macular degeneration Pre-sarcopenia Niemann-Pick type B Solid tumors (AMD) SAR393590 (Oral clofaribine) SAR404460 N GZ402671 N UshStat® N DNA synthesis inhibitor DHA-GPL + Vit D GCS Inhibitor Gene therapy Hematological malignancies Pre-sarcopenia Fabry Disease Usher syndrome 1B SAR126119 N Jevtana® (cabazitaxel) TAFIa inhibitor Gastric cancer (2L) Acute ischemic stroke N New Molecular Entity Oncology Thrombosis Vaccines Metabolic Disorders Central Nervous System Internal Medicine 36 Ophthalmology Genetic diseases Biosurgery Aging
  • 37. R&D Pipeline Summary TableNew Molecular Entities (NMEs) and Vaccines Phase I Phase II Phase III Registration TOTALOncology 8 4 3 0 15Metabolic Disorders 2 0 1 2 5Thrombosis 1 0 1 0 2Central Nervous System 2 0 0 2 4 52Internal Medicine 3 7 1 0 11Ophthalmology 4 1 0 0 5Genetic Diseases 2 0 1 0 3Aging 4 3 0 0 7Vaccines 4 3 4 2 13TOTAL 30 18 11 6 65 48 17 NMEs & Vaccines 37
  • 38. Expected R&D Milestones – Pharmaceuticals Product Event Timing Zaltrap® (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 38
  • 39. Expected R&D Milestones – Vaccines Product Event Timing Fluzone® 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 39
  • 40. APPENDICESFINANCE 40
  • 41. Business Net Income Statement Third quarter 2012 Pharmaceuticals Vaccines Animal health Other Group Total Millions of euros Q3 2012 Q3 2011 % c ha nge Q3 2012 Q3 2011 % c ha nge Q3 2012 Q3 2011 % c ha nge Q3 2012 Q3 2011 Q3 2012 Q3 2011 % c ha nge 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 (1,016) (1,031) (1.5%) (97) (154) (37.0%) (36) (36) 0.0% (1,149) (1,221) (5.9%) expenses As % of net sales (14.4%) (14.9%) (6.5%) (11.5%) (6.9%) (7.7%) (12.7%) (13.9%) Selling and general (1,874) (1,827) 2.6% (153) (140) 9.3% (156) (147) 6.1% (2,183) (2,114) 3.3% expenses As % of net sales (26.6%) (26.3%) (10.3%) (10.4%) (30.1%) (31.2%) (24.1%) (24.2%) Other current operating 58 (1) (2) 2 7 (4) 4 43 67 40 income/expenses Share of profit/loss of 10 269 (4) 7 6 276 associates* Net income attributable to (39) (55) 1 (39) (54) non-controlling interests Business operating 2,230 2,607 (14.5%) 654 564 16.0% 173 130 33.1% 4 43 3,061 3,344 (8.5%) income As % of net sales 31.7% 37.6% 44.2% 42.0% 33.3% 27.7% 33.9% 38.2% Financial income and (84) (121) expenses 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%) *     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
  • 42. Business Net Income Statement Nine months 2012 Pharmaceuticals Vaccines Animal health Other Group Total Millions of euros 9M 2012 9M 2011 % c ha nge 9M 2012 9M 2011 % c ha nge 9M 2012 9M 2011 % c ha nge 9M 2012 9M 2011 9M 2012 9M 2011 % c ha nge 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 (3,067) (2,994) 2.4% (381) (418) (8.9%) (116) (106) 9.4% (3,564) (3,518) 1.3% expenses As % of net sales (14.0%) (14.5%) (13.2%) (15.8%) (6.9%) (6.8%) (13.5%) (14.1%) Selling and general (5,637) (5,441) 3.6% (441) (404) 9.2% (514) (469) 9.6% (1) (1) (6,593) (6,315) 4.4% expenses As % of net sales (25.8%) (26.3%) (15.3%) (15.2%) (30.7%) (30.1%) (25.0%) (25.4%) Other current operating 37 41 (3) 1 8 (11) 20 32 62 63 income/expenses Share of profit/loss of 435 828 (10) 5 13 425 846 associates* Net income attributable to (143) (191) 1 (143) (190) non-controlling interests Business operating 7,757 7,968 (2.6%) 919 801 14.7% 562 503 11.7% 19 44 9,257 9,316 (0.6%) income As % of net sales 35.5% 38.5% 31.9% 30.2% 33.6% 32.2% 35.0% 37.4% Financial income and (311) (299) expenses 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%) *     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
  • 43. Reconciliation of Business Net Income to ConsolidatedNet Income Attributable to Equity Holders of sanofi Millions of euros Q3 2012 Q3 2011 % change Business 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 work down 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 (7) (7) impact of acquisitions on associates and joint ventures 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% ) 43
  • 44. Reconciliation of Business Net Income to ConsolidatedNet Income Attributable to Equity Holders of sanofi Millions of euros 9M 2012 9M 2011 % change Business 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 work down 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 (22) (21) impact of acquisitions on associates and joint ventures 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% 44
  • 45. Consolidated Income Statements € million Q3 2012 Q3 2011 9M 2012 9M 2011 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
  • 46. Consolidated Income Statements € million Q3 2012 Q3 2011 9M 2012 9M 2011 Operating income 2,144 2,334 5,937 4,788 Financial expenses (135) (153) (407) (387) Financial income 51 32 96 88 Income 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

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