SANOFI said it will repurchase five billion euros (S$7 billion) of stock and grow profits more quickly this year as the drugmaker pivots away from consumer health to focus on fast-growing drugs such as its respiratory syncytial virus (RSV) shot.
Earnings per share, excluding some items, are likely to increase by a low double-digit percentage at constant currencies in 2025, compared with 4.1 per cent growth last year, the French company said in a statement on Thursday (Jan 30).
The buyback comes after Sanofi agreed late last year to sell a controlling stake in its consumer health business, Opella, to US private equity firm Clayton Dubilier & Rice. The deal is expected to close as soon as next quarter. Sanofi also forecast mid to high single-digit percentage sales growth this year.
Sanofi shares rose as much as 1.9 per cent in Paris trading and have gained about 10 per cent this year, outperforming a 4.5 per cent increase in a Bloomberg index of European pharmaceutical companies.
Chief executive officer Paul Hudson is focused on boosting Sanofi’s drug development, hoping to produce more blockbusters like Beyfortus, which protects against RSV. Developed with AstraZeneca, the drug had sales of 841 million euros in the fourth quarter, higher than the 679 million euros expected by analysts.
Sanofi expects further growth for Beyfortus this year, though not at the same pace as just after its initial launch, chief financial officer Francois-Xavier Roger told reporters. The company is expected to soon face competition from Merck & Co, which is also developing a drug to protect babies against RSV.
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Sanofi’s asthma drug Dupixent reached 3.5 billion euros in sales last quarter, slightly below estimates. The company expects demand for the drug, which treats the lung condition known as chronic obstructive pulmonary disease, to accelerate this year .
Sanofi intends to work with the new US administration of Donald Trump and engage in a dialogue on how to get medicines and vaccines to patients, Roger said.
Trump’s choice of Robert F Kennedy Jr, a prominent vaccine sceptic and critic of Big Pharma, to run the Department of Health and Human Services has raised concern among drugmakers.
Sanofi has not been a frontrunner in the burgeoning field of obesity drugs and does not yet know if it will “play in that space”, Hudson said on a media call. Still, the drugmaker has several obesity assets in very early-stage development.
While current GLP-1 drugs lead to weight loss, patients also lose muscle alongside fat, said Hudson. When they stop taking the drugs, they often put weight back on, which will more likely be fat than muscle.
The next generation of obesity drugs could be about maintaining weight loss, said Hudson. BLOOMBERG
