SAR-441000

Headline results for the second quarter: Biopharma sales (specialty care, general medicines and vaccines): €8.7 billion ($9.6 billion), in-line with estimates and down 1% Overall revenue: €9.97 billion ($10.9 billion) versus forecasts of €10 billion and down 1.5% Profit: €1.4 billion ($1.6 billion), versus €1.2 billion in Q2 2022Note: All changes are versus the prior-year period unless otherwise statedWhat the company said:In reference to Sanofi’s performance as measured using constant exchange rates, CEO Paul Hudson remarked “we have delivered yet another quarter of growth, with specialty care and vaccines as the main drivers.” “As we move into the second half (of 2023), we are particularly enthusiastic about the strong flow of positive R&D data readouts and regulatory achievements of this second quarter, highlighting the significant growth potential of our innovative pipeline assets. We are executing on our new launches and we are encouraged by the early launch indicators of Altuviiio and Tzield, while navigating the anticipated impact from generic competition on AubagioOther results: Specialty care unit: €4.4 billion, up 8% Dupixent: €2.6 billion, in-line with estimates and up 30.5% Aubagio: €216 million, down 58.9%, impacted by generic competition in the US Fabrazyme: €250 million, up 5% Alprolix: €135 million, up 4.7% Eloctate: €130 million, down 15% Sarclisa: €94 million, up 46.9% Alltuviiio:  €18 million General medicines unit: €3.1 billion, down 12.8% Lantus: €353 million, down 41.2% Toujeo: €291 million, up 9% Plavix: €240 million, down 2.8% Vaccines division: €1.2 billion, up 3.8% Consumer healthcare: €1.2 billion, down 5% Sales in China: €785 million, up 6.3% on a constant exchange rate (CER) basisLooking ahead:Sanofi said it now expects earnings per share for the full year to grow at a mid-single digit percentage, excluding the effect of currency swings and barring any unforeseen major adverse events. The company had previously guided to a low-single digit rise and this upgrade includes approximately €400 million in expected one-off COVID-19 vaccine revenues in the second half of 2023. Management estimates that the negative current impact on 2023 earnings will be between 6.5% and 7.5%, versus prior guidance of 5.5% to 6.5%.What analysts said:     Commenting on Sanofi's Q2 performance, Morgan Stanley analysts said "results were in line on sales and above on business operating income and business EPS helped by one-off COVID-19 revenues and a capital gain. Thus we see both the 2Q23 beat and the guidance raise as lower quality, with the underlying EPS guidance (ex-COVID) implying FY23 EPS 2-3% below consensus expectations."Analysts at Jefferies said second quarter results are broadly in line with expectations but said Sanofi’s current valuation does not reflect potentially robust revenue growth over the next decade. In note to investors, they highlight potentially impressive launches for Beyfortus and Altuviiio and cite momentum for Sanofi’s immunology pipeline. Whilst overhang relating to US Zantac litigation persists, this has been largely cleared, they add.Pipeline update:Phase III readouts for tolebrutinib in relapsing multiple sclerosis are now expected to occur in mid-2024, with data in secondary progressive patients anticipated earlier next year.The PROTECT placebo-controlled study investigating Tzield in patients with newly diagnosed stage 3 Type 1 diabetes met its primary endpoint (change from baseline in C-peptide level relative to placebo at week 78) but only demonstrated a positive numerical trend for the secondary endpoints of insulin use and time in target glucose range (TIR) while not achieving statistical significance.Phase III studies of frexalimab in multiple sclerosis and amlitelimab in atopic dermatitis will be initiated in the first half of 2024.Sanofi and BioNTech have jointly decided to terminate the development of the mRNA coding for cytokines SAR441000 as intratumoral therapy, based on interim analysis results.($1 = €0.910448)

Sanofi, which first dipped its toes into messenger RNA research through a partnership when the technology was still unproven, is now diving in completely by creating a division that will focus exclusively on developing new mRNA vaccines. The Paris-based pharmaceutical giant announced Tuesday the formation of its mRNA Center of Excellence, which will be supported by about €400 million ($477 million) annually. This center will have about 400 employees based in Cambridge, Massachusetts and Lyon, France. Sanofi is already one of the largest vaccines companies in the world. Its vaccines business segment generated more than €5.9 billion in sales last year (about $7 billion). But those products are based on traditional vaccine technologies, which require a lengthy process for producing the antigens that prompt the immune response. In mRNA vaccines, that antigen, a protein, is produced by a person’s own cells. The vaccine delivers the genetic instructions that tell cells what protein to make. The new Sanofi mRNA vaccines division follows the successful development of mRNA-based Covid-19 vaccines from Moderna and BioNTech. But these vaccines still present challenges, including ultra-cold storage requirements as well as patient tolerability of the headaches, chills, and other effects experienced in the day or two following vaccination. Sanofi believes it can improve on those aspects of mRNA vaccines, and in doing so, make the technology applicable to more diseases. The company has set a goal of advancing at least six mRNA vaccine candidates to clinical testing by 2025. “During the Covid-19 pandemic, mRNA technologies demonstrated potential to deliver new vaccines faster than ever before,” Jean-Francois Toussaint, global head of research and development for Sanofi Pasteur, said in a prepared statement. “However, key areas of innovation such as thermostability and tolerability improvements will be critical to unlock the applications of mRNA in routine vaccination against a broader set of infectious diseases and across all ages. The Sanofi mRNA vaccines Center of Excellence aims to lead the field in this next chapter of vaccine innovation.” Sanofi’s initial foray into mRNA vaccines was three years ago, when it began its collaboration with Cambridge, Massachusetts-based Translate Bio. That alliance covered the development vaccines for five infectious diseases based on Translate Bio’s mRNA platform. The deal included an option to expand to more pathogens. In March 2020, the partners announced they would build on that partnership by working together to develop an mRNA vaccine for Covid-19. A little more than a year ago, the partnership formally expanded to include the Covid-19 vaccine candidate as well as other targets, such as influenza. Sanofi paid Translate Bio $425 million up front—$300 million in cash, $125 million in an equity investment. Under the agreement, it could be responsible for up to $1.9 billion more in milestone payments. That total includes $450 in milestones covered under the original 2018 deal. The partnered Covid-19 vaccine candidate is currently in Phase 1/2 testing. Last week, Sanofi and Translate Bio began a Phase 1 study testing an mRNA vaccine for influenza. The study, which is enrolling up to 280 healthy adults, is expected to post preliminary data by the end of this year. Sanofi has also spread its mRNA bets to include other applications of the mRNA technology. The company is collaborating with BioNTech on SAR441000, an mRNA therapeutic candidate intended to stimulate an immune response to tumors. That program is in Phase 1 testing. In April, the pharmaceutical giant paid an undisclosed sum to acquire Tidal Therapeutics, a preclinical-stage biotech company that is developing a way to use mRNA to engineer immune cells inside the patient as a way of producing new cell therapies for cancer.