The stocks to follow tomorrow on the Paris Stock Exchange – Thursday August 18, 2022 – 08/17/2022 at 5:37 p.m.

The stocks to follow tomorrow on the Paris Stock Exchange - Thursday August 18, 2022 - 08/17/2022 at 5:37 p.m.

(AOF) –

Sanofi

The Sanofi title fell 5.68% to 81.67 euros on the Paris Stock Exchange, the largest drop in the CAC 40 index after that of Alstom (- 6.66%). The pharmaceutical group has announced that it is ending the global clinical development program for amcenestrant, an oral treatment intended for the treatment of patients with advanced or metastatic breast cancer. In a note published a few weeks ago, Jefferies estimated that the amcenestrant could represent up to $2 billion in revenue per year for Sanofi after a launch in 2025.

AOF – LEARN MORE

Key points

– 5

th

global pharmaceutical group, created in 1994, first in Europe, and 1

er

worldwide in vaccines;

– Balanced sales of €37.8 billion from 4 divisions: general medicine for 34%, specialty medicine (immunology, neurology and oncology) for 35%, vaccines for 20% and consumer healthcare;

– Growing share of emerging countries (34% of sales) behind the United States (38%) and Europe (28%);

– Business model in 4 points: a simplified organization, a restructured portfolio containing more organic products, a transformed R&D and strong ambitions in terms of profitability and financial solidity; –

– Split capital (excluding L’Oréal: 9.48% of shares and 16.95% of voting rights), Serge Weinberg chairing the 16-member board of directors, Paul Hudson being CEO;

– Healthy balance sheet with net debt reduced to €8.8 billion and free cash flow of €8.1 billion.

Challenges

– 2020-2025 “Play to win” plan aimed at creating an agile group and the world’s No. /25: reduction of 1/3 of product families and productivity driven by R&D and digital in factories, operating margin of 32%;

– Innovation strategy: 5 areas of research: immunology & inflammation, oncology, neurology (particularly sclerosis), rare hematological diseases & rare diseases, vaccines / 91 projects in progress, including 29 in phase 3 and 5 awaiting approval by the authorities / developed in collaboration -Kymera for immunology, Translate Bio in RNA for vaccines- or through acquisitions -Kiadis, Biopharma, Kymab for oncology / supported by technological platforms: small molecules, antibodies, hemogenetic proteins, genomics ;

– Planet Mobilization environmental strategy aiming for carbon neutrality by 2030, 100% sustainable electricity consumption against 50% in 2021 and 100% of the sustainable car fleet against 22% / in 2027, elimination of plastic packaging for vaccines / in 2025, eco-design of all new products / launch of lines of credit indexed to sustainable development;

– Impact of the 5 “priority” drugs: Amcenestrant (breast cancer), Fitusiran (RNA for hemophilia), Efanesoctocog (hemophilia), Nirsevimab and Nisevimab (respiratory viruses) and Tolebrutinib (multiple sclerosis):

– After Origimm, specialized in research on skin conditions, Kadmon and Owkin, agreement to acquire Amunix in immuno-oncology, strengthening the R&D portfolio of biological agents.

Challenges

– Image tarnished by the delay of the vaccine against Covid 19;

– IPO of EUROAPI, a group created from the group’s activities in the production of active pharmaceutical ingredients or APIs in Europe, shareholders receiving 1 EUROAPI share for 23 shares and the capital being divided between Sanofi for 30% and BPIFrance for 12 %;

– 2022 objective of growth of at least 10% in earnings per share;

– 2021 dividend of €3.33.

An inevitable race for new blockbusters

The patent for Merck’s star product, the cancer drug Keytruda, which accounts for more than 35% of its sales, expires in 2028. Despite the loss, since 2019, of the patents for its three star products (Avastin, Herceptine, Rituxan) Roche was able to renew its portfolio by bringing new molecules to market. However, the discovery and launch of new drugs are increasingly expensive. AstraZeneca spends about $6 billion a year on R&D in a pharmaceutical industry where the life of a patent only lasts ten to fifteen years. This leads laboratories to withdraw from certain activities. Thus J&J, Pfizer, GSK and, no doubt, Novartis soon prefer to refocus on specialty drugs and abandon any ancillary activity.

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