Despite pertinent pandemic pressures and tough comps (due to panic buying), Sanofi reported decent growth in Q1 21 – driven by robust growth in the Dupixent and vaccine business. Moreover, profitability improved further due to the cost initiatives measures in place. While pandemic-induced uncertainties are here to stay, the group should find support from new launches and label and geographic expansion of key drugs. Additionally, success in the COVID-19 vaccine development space could prove anoth
Companies: Sanofi (SAN:EPA)Sanofi (SAN:PAR)
Despite the COVID-19-related disruption, the CEO’s bet on Dupixent and Vaccines paid off in Q4. The boss has now taken a shot to revitalise the slow-growing Consumer-healthcare and General-medicine businesses, along with additional cost-saving of €500m by FY22 – these measures should help Sanofi achieve its FY25 profitability target. The bolt-on strategy will continue to strengthen the pipeline, along with a key focus on six multi-blockbuster drugs. A breakthrough in the COVID-19 vaccine space c
In line with its strategy of expanding its focus on the immuno-oncology space and strengthening its internal R&D pipeline, Sanofi has spent €5.2bn on the acquisition of two small biotech firms ytd. Given that the French pharma giant still has gun powder of €30-50bn, a big ticket acquisition is highly likely, with Alexion being a good strategic fit in our view. Bolt-on deals might also be on the cards and PTC Therapeutics, Inovio and Editas could be Sanofi’s hit list.
Q2 sales came under pressure due to de-stocking and lockdown-related disruptions across the segments, though the momentum was partly offset by a strong show in Dupixent. Combined with effective cost management, the operating margin expanded during the quarter. While a recovery to pre-COVID levels would take time, the rising risk of the second wave of Coronavirus and seasonal flu should ensure high demand for the high-margin Influenza vaccines in H2. Top this up with the COVID-19-related opportun
Sanofi’s MS partner Principia Biopharma (EV of $2.4bn) has been in the headlines as a potential takeover target. Given the French pharma’s swelling war chest and the strategic vision of the CEO, such rumours could have legs. In an attempt to increase its focus on innovative drugs, Sanofi has also started the divestment (through IPO) procedure of the world’s second-largest API company (valued at $2bn).
Sanofi is developing a COVID-19 vaccine based on the traditional/proven recombinant-platform technology. It has the capability to manufacture 1bn doses by the end of 2021. Also, the French firm has joined hands with Translate Bio to develop a candidate using a new, though unproven, mRNA-technology – if successful, 400m doses would be ready by the end of 2021. As governments across the globe try to achieve herd immunity for their citizens, pre-booking for COVID-19 vaccines have already started.
Q1 outperformance was fuelled by the stockpiling of drugs, particularly for chronic and generic medicines. While these pantry-loading benefits, mainly in the consumer healthcare segment, should fade away in Q2, robust demand for speciality care drugs, especially Dupixent, would ensure that FY20 financial targets are met. COVID-19-related opportunities – Sanofi is working on vaccines, diagnostics as well as short-term relief drugs – makes the French firm even more attractive and thus we reiterate
Despite being weighed down by the recall of Zantac, FY19 ended on a decent note on the back of strong traction for Dupixent and Vaccines. The outlook for FY20 is also encouraging as the new CEO places his bet on Dupixent and the growing oncology pipeline during the transition phase. Results of the phase II multiple sclerosis study bodes well for the mid-term. Nonetheless, the Bioverativ deal seems to have back-fired as Roche’s Hemlibra continues to gain strength.
Sanofi’s new CEO has identified dupixent and vaccines as the mid-term growth drivers, as the company moves away from slow-growing diabetes and cardiovascular therapeutic areas. Consumer Healthcare and other non-core assets should soon be up for sale and the proceeds could be diverted towards fast-growing therapeutic areas (it acquired an immune-oncology drug recently). With respect to profitability, the recently introduced €2bn cost savings programme holds the key. With a strategy now in place,
Q3 was in line and the robust performance in Speciality Care, particularly Dupixent, and Emerging Markets was offset by a dismal show in Vaccines and Consumer Healthcare. While Dupixent and China should continue to be the key growth drivers in the mid-term, we anticipate a recovery in Vaccines and Consumer Healthcare in the coming quarters. However, Oncology is still a question mark. We eagerly wait the new CEO’s first capital markets day in December 2019.
The cancer burden is growing globally. Each year >18 million people are diagnosed, nearly 10 million die and the estimated economic cost exceeds $1 trillion. From early diagnosis to late-stage disease, cancer care often involves inappropriate or unnecessary interventions that drive costs but provide limited clinical benefit. Coupled with an increased understanding of cancer biology and rapid technological advances, this has been driving momentum for precision medicine, leading to patient and soc
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Sanofi announced a mixed performance in Q2. While the operating results for the quarter were impressive and it upgraded the business EPS guidance, the Bioverative acquisition has shown to be a deal pursued in haste. An impairment charge of €1.8bn, mainly related to haemophilia drug, Eloctate, is being recorded. The specialty side (rare diseases, multiple sclerosis, etc.) and vaccines came in strongly, while consumer health remained mediocre and primary care (including diabetes, other mature drug
Sanofi reported top-line and bottom-line numbers ahead of our expectations, although the top-line lagged the street’s expectations. The sales growth of 4.2% at CER to €8.4bn was characterised by solid sales in speciality pharma and vaccines, while consumer healthcare (CHC) came in flat and primary pharma deteriorated. Emerging markets delivered a robust performance, followed by the US, while Europe entered into the year with a whimper. Management maintained its FY19 business-EPS growth expectati
Sanofi’s top-line performance for Q4 was weaker than expected, but profitability made up for the under-performance, along with a slightly better-than-expected outlook for 2019. Sales grew by 3.9% at CER and at 2.6% at CER/CS to €9bn, with the pharma business growing by 3% (CER/CS), consumer healthcare by 2%, and vaccine by 9.7%. Geographically, Europe (-4.8%) was a major disappointment, primarily due to generic erosion of the mature established drugs and a weak consumer health business.
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‘New GSK’ has unveiled ambitious mid-term targets – sales and operating profit CAGR of >5% and >10%, respectively, during 2021-26. Unsurprisingly, dividends will be slashed in 2022, due to the spin-off of the cash-generative consumer healthcare business, though a progressive dividend policy thereafter is appeasing. Despite a well-defined road-map, a bigger overhang would be execution, especially in the backdrop of lacklustre performance in recent years. Remember, management’s every action is und
Companies: GlaxoSmithKline plc
Venture Life has announced it has entered into a Revolving Credit Facility (RCF) with Santander UK and Silicon Valley Bank. The funds, of up to £50m, provide leverage to the company's existing cash resources, and will support management's M&A ambitions, following the recent acquisition of BBI Healthcare for c£36m. We remain encouraged by Venture Life actively progressing its overall M&A strategy, which we expect to scale the company and provide operational leverage opportunities to maximise the
Companies: Venture Life Group Plc
RUA Life Sciences has announced a short delay to the filing of its 510(k) application to the FDA for its large bore vascular graft product. The delay is due to the unexplained presence of non-toxic cellulose found during the analysis of leachable extracts from tested graft samples. Significantly, results from the more important tests (eg in vivo animal tests) were all positive. RUA will undertake additional graft testing, resulting in the delay to filing, to ensure the submission is as strong as
Companies: RUA Life Sciences Plc
ANGLE has raised £20m (gross) to accelerate further clinical applications for Parsortix and exploit the first-mover advantage that the FDA clearance for Parsortix will create. The funds will be used to develop a pre-biopsy test for prostate cancer, expanding its assay development capabilities for its pharma services business and strengthening management in the US to capitalise on the enormous opportunity that the adoption of liquid biopsies in this market offers. It also funds the ongoing operat
Companies: ANGLE plc
VLG has agreed a new £30m RCF (with a further £20m available subject to certain conditions). This provides significant additional low-cost funding to continue its growth strategy, including accretive acquisitions. With an exciting pipeline of opportunities, and a strong track record of delivery (including realisation of synergies), this news should be well received. In the first full year of earnings and synergy from its most recent BBIH acquisition, the EV/EBITDA multiple is currently just 10x
As midsummer’s day looms (where has this year gone?), there is greater optimism, in general, than may have been anticipated a few months ago. A post-pandemic, ‘vaccine-driven’ recovery demonstrated by increased consumer spending as lockdown measures are lifted has been one of the catalysts. The FTSE 100 has been range-bound in the last month 6,900-7,100. We have seen a combination of broadly positive company results across a range of sectors, further examples of M&A activity and a sequence of ne
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Companies: Medica Group Plc (MGP:LON)PureTech Health PLC (PRTC:LON)
Calnex Solutions has announced record results for FY21 following customer orders up across all product types and within all regions, with FY21 revenue up 31% to £18.0m and adjusted PBT up 43% to £5.1m. Calnex has firmly established a trusted reputation worldwide, launching multiple first to market telecoms and network testing solutions. Calnex continues to accelerate its investment in R&D and expand its product roadmap, adding increased engineering, sales and customer support capacity in order t
Companies: Calnex Solutions Plc
There has been a safety halt to the lead human retinal progenitor cell (hRPC) project. The issue was an eye infection in one patient following a successful surgical implantation of the hRPC. The cause is under investigation. If, as we assume, the trial restarts in the next few months, data should be available by Q421, a delay of perhaps three months. This is not significant within the overall developmental pathway and good data are needed to secure any future partnership from mid-2022. The valua
Companies: ReNeuron Group plc
SUN’s AGM statement paints a picture of a business recovering well after the challenges posed by the pandemic. It has successfully won new accounts in the UK and US on the back of its strong environmental and health economic credentials. These look to be increasingly resonating and are laying the foundations for a powerful growth story as elective surgery volumes recover. This should be sustained into the medium term as healthcare systems around the world look to reduce waiting times, costs and
Companies: Surgical Innovations Group plc
The UK market showed a continued recovery in the first quarter albeit the indices are still well short of their all-time peaks, unlike many of their international peers. The FTSE 100 has risen by 1,186 points (21.4%) since the end of October and the FTSE 250 by 4,304 points (25.0%). The comparable performance since the start of the year is less spectacular- the FTSE 100 has risen by 253 points (3.9%) and the FTSE 250 has risen by 1,070 points (5.0%). The factors behind the sustained rally are fa
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In an encouraging sign of building US momentum, Yourgene has announced it has signed a multi-year licence and supply agreement with a major US precision medicine company to enable it to offer a new reproductive health screening service from its own laboratories. The agreement encompasses a non-exclusive licence to Yourgene’s proprietary bioinformatics Flex analysis software and a supply agreement for sample preparation reagents and instrumentation. Notably, this includes the Ranger sample enrich
Companies: Yourgene Health Plc
Belluscura is a medical device company focused on developing lightweight and portable oxygen enrichment technology. The group completed its IPO in June, raising £17.5m at a price of 45p. Following IPO, the group has appointed a VP of Operations and this morning has confirmed its first US distribution deal. On 15th June, the group announced the appointment of Keith Cook as Vice President of Operations, based in Plano, Texas. Keith was previously Director of Operations at Inogen, the market leader
Companies: Belluscura PLC
Calnex Solutions is a leading provider of test and measurement hardware and software solutions that enable performance validation and standards conformance of critical infrastructure associated with telecoms and high-speed data networks. 5G network evolution is a significant, long-term driver of growth for the business along with the continued expansion of hyperscale datacentre enterprises and their increasing participation in telecoms infrastructure markets. Calnex has established a trusted rep
Half-year results to December 2020 reflect a period in which genedrive has made notable strides, but also reflect frustrating delays in commercialising its products, largely due to factors outside of its control. genedrive generated revenues of £0.4m in the half-year (2019: £0.6m, -43%), with an adjusted net loss of £2.9m (2019: -£2.8m, -3%) with cash of £3.8m at the end of the period. genedrive remains hopeful for FDA emergency use authorisation (EUA) for Genedrive 96® SARS-CoV-2 and remains in
Companies: Genedrive Plc