Sanofi said it is starting the delayed phase 2 trial of the coronavirus vaccine it is developing with GlaxoSmithKline PLC this month, as it reported in-line sales for the fourth quarter and a hike in cost savings.
Paris-based Sanofi — the third-largest vaccines company in the world — used a pause in its program to develop an improved antigen formulation for the experimental vaccine, which uses GSK's adjuvant to boost immune response, after a phase 1 trial showed a poor response in older adults.
The French biopharma group also said Feb. 5 that it has increased its savings target by €500 million to €2.5 billion by 2022, which it intends to reinvest in the business.
Earlier in the day, Sanofi reported fourth-quarter pharma sales of €6.29 billion, compared to Jefferies' estimate at €6.36 billion and consensus at €6.42 billion. In the consumer health business — which Sanofi is turning into a stand-alone unit — sales came in at €1.03 billion, compared to Jefferies and consensus estimates of €1.09 billion.
Vaccine sales were 12% ahead, offsetting the pharma and consumer units, which were 2% shy and 6% shy, respectively, Jefferies analyst Peter Welford said. Dupixent, the eczema medicine that Pfizer CEO Paul Hudson has forecast could reach annual sales of more than €10 billion, fell short of expectations, coming in at €982 million versus consensus of €993 million and Jefferies' estimate of €989 million.
Hudson has pledged to exit Sanofi's traditional areas of research, including diabetes and cardiovascular, and has doubled down on immunology following the acquisition of Principia Biopharma Inc. in August 2020 and Kymab Ltd. in January. At today's virtual capital markets, analysts will be looking for more detail on Sanofi's pipeline, the spinoff of its active pharmaceutical ingredients production business and the group's financial targets.
For 2021, Hudson forecast high single-digit EPS growth at constant exchange rates, with a 4.5% to 5.5% forex headwind. UBS analyst Laura Sutcliffe, who rates the stock a "buy," said that although consensus is slightly above this, it is in line with expectations.
"Given uncertainties around the timing and extent of COVID-19, normalization for new patient starts, vaccines and consumer healthcare pharmacy traffic, we expect Sanofi to guide conservatively at the start of the year with room for potential guidance raises later on," Morgan Stanley analyst Mark Purcell, who rates the stock "overweight," wrote in a note ahead of the results.
Sanofi said phase 3 trials of its hemophilia medicine, fitusiran, have restarted after an amended protocol was introduced following a clinical hold reported Nov. 6, 2020. Elsewhere, the company has dropped three assets from its pipeline, including itepekimab, which was being trialed in asthma, while a phase 2 Parkinson's trial of Venglustat, an experimental treatment for rare conditions including Fabry disease and Gaucher disease, was halted.
A further three late-stage trials were launched to expand the use of Dupixent, which should support the multiblockbuster potential of Sanofi's key "'pipeline in a drug'" asset.
