According to reports, boosted by growing demand for its blockbuster skin and asthma drug Dupixent, Sanofi has raised its full-year sales and profit guidance for the second consecutive quarter.
The French pharmaceutical company said on Friday that at constant exchange rates, it expects sales growth in the low double-digit percentage range for the year, up from its previous forecast of 10%, and earnings per share excluding certain items to grow in the mid double-digit percentage range.
Data showed that Sanofi's third-quarter net sales reached 14.444 billion euros, up 16.2% year-on-year, or 14.3% at constant exchange rates. Among this, Dupixent sales hit 5.7 billion euros (approximately $6.4 billion), surging 34.8% year-on-year, marking the second time in history that quarterly sales surpassed 5 billion euros and beating analysts' expectations of 5.2 billion euros, which drove profit above forecasts. Earnings per share excluding certain items came in at 3.55 euros, well above analysts' expectations of 2.80 euros.
Dupixent's strong performance offset the impact of declining vaccine sales. The vaccine business underperformed due to pressure in the U.S. market for its flu vaccine and respiratory syncytial virus (RSV) drug Beyfortus. Additionally, Sanofi's spending on drug sales and promotion-related expenses was lower than expected.
Heavy Reliance on a Single Drug, 'Post-Dupixent Era' in Focus
However, Dupixent's sales performance also highlights Sanofi's deep reliance on the drug. The medication will begin losing patent protection in the early 2030s, and Sanofi has yet to find a credible alternative revenue source.
Dupixent was co-developed by Sanofi and Regeneron Pharmaceuticals. New Chief Executive Officer Belén Garijo said in a statement: "The entire organization is focused on managing Sanofi's trajectory in the 'post-Dupixent era' over the next decade. Our top priority is to protect profitability through Dupixent's patent expiration."
Garijo has halted development of several drugs she deemed to have poor prospects and plans to build the research and development pipeline in a more rigorous manner. She also replaced R&D head Houman Ashrafian with former Roche executive Paulo Fontoura.
Investors Await Major Acquisition, New Drugs Begin Contributing Incremental Growth
Investors are waiting for a major acquisition, likely targeting a late-stage development asset that can be brought to market in time to offset some of the Dupixent sales loss. Earlier this year, Sanofi and Regeneron said they would expand their collaboration, with the deal potentially earning the U.S. drugmaker up to $8 billion.
Chief Financial Officer François-Xavier Roger said that recently launched products now account for a higher proportion of sales contributions than ever before. Altuviiio, a new drug for hemophilia A, and Rezurock, a treatment for chronic graft-versus-host disease, both exceeded sales expectations last quarter.
Roger also said Sanofi is looking for larger deals than in the past, with the main risk in the targets being commercialization. "The amounts of money involved are larger than what we have sought in the past," he said during a press conference call.
Roger stated that Sanofi expects to update its strategic priorities before the end of the year. Concerns about growth prospects have weighed on Sanofi's stock price, which has fallen about 8% year-to-date. This follows disappointing results from multiple clinical trials, including an experimental drug for atopic dermatitis called amlitelimab and a treatment for a rare autoimmune disease.
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