Sanofi outlines roadmap for the next five years

French drugmaker does not expect any meaningful bottom line growth until 2018

Olivier Brandicourt: Our portfolio will be refocused on areas where we can win, including diabetes, cardiovascular therapies and vaccines

Sanofi does not expect 'any meaningful bottom line growth' for the next two years, as it described a new 'strategic roadmap' over the next five years.

The French drugmaker said it would refocus its portfolio and simplify the organisation in an effort to grow the EPS of its business faster than sales starting in 2018.

Sanofi said it expects to deliver a sales compound annual growth rate (CAGR) of between +3% and +4%4 over 2015–2020, with a target of mid-single digit growth in the second half of this period.

Chief Executive Olivier Brandcourt said Sanofi's portfolio would be 'refocused on areas where we can win', including diabetes, cardiovascular therapies and vaccines.

'Along with a more streamlined and accountable organisation, we are taking clear measures to ensure success as we launch a strong set of new medicines across several therapeutic areas,' he said.

'By building on the successes of these products, we are confident that Sanofi will be well-positioned for sustained, long-term growth.'

The firm is also seeking 'external opportunities' to enhance its growth profile.

Sanofi's portfolio will be refocused on areas where we can win

Sanofi said its long term strategy rests on four pillars: reshainge the portfolio, delivering outstanding launches, sustaining innovation in R&D and simplifying the organisation.

The company plans to 'sustain its leadership in diabetes and cardiovascular, vaccines, rare diseases and emerging markets'. In diabetes, the firm plans to develop its insulin franchise, which includes Lantus, Toujeo and LixiLan, strengthen its pipeline through external opportunities (e.g. in-licensing agreements with Lexicon and Hanmi) and lead the market shift to managing diabetes outcomes. The collaboration with Google Life Sciences is a good example of the latter, the firm said.

In the cardiovascular space, Sanofi is 'excited about the prospects for Praluent' and 'eagerly awaits the results of the ODYSSEY cardiovascular outcomes trial in 2016-2017', which should help to capture the drug’s full potential.

In vaccines, the objective is to grow faster than the market through its Dengvaxia, flu, paediatric and boosters vaccines.

In emerging markets, Sanofi said it intends to retain its number one position through greater focus on priority countries, where 'resource allocation' will be focused, and 'the industrial footprint will be adapted and dedicated innovations will be specifically developed'.

Sanofi said it plans to build positions in multiple sclerosis, oncology, immunology and consumer healthcare. In oncology, the company intends to maximise clinical assets such as isatuximab in multiple myeloma, and restore a competitive pipeline through its strategic collaboration with Regeneron in immuno-oncology.

In immunology, sarilumab in rheumatoid arthritis and dupilumab in atopic dermatitis and asthma will be the two pillars of a new franchise, while in consumer healthcare, Sanofi plans to build scale through new categories of products and bolt-on acquisitions.

Sanofi said it would explore options for its Merial animal health unit and European generics businesses where 'geographic synergies are limited and market complexity is increasing'.

All options will be considered for these businesses including retention in the Group, the firm said.

Sanofi will sustain its leadership in diabetes and cardiovascular, vaccines, rare diseases and emerging markets

Sanofi said growth would be driven by scheduled product launches for the next five years, with up to 18 new products expected to arrive on the market by 2020. Among these, Sanofi projects that six (Toujeo, Praluent, Dengvaxia, sarilumab, LixiLan and dupilumab) could generate sales of €12–14bn by 2025.

Sanofi also announced plans to strengthen its R&D pipeline and evolve its R&D model based on project teams and alignment with global business units (GBUs). The organisation will also foster its existing R&D collaborations and increase its capacity for external innovation.

As announced in July, Sanofi is in the process of simplifying its global organisation. The move to five GBUs will start to be implemented from January 2016 following consultations with the workforce.

In addition, Sanofi plans to reshape its plant network to match business evolution with increased emphasis on the growing biologics portfolio.

Simplification of the organisation worldwide and a more focused portfolio should allow cost savings of €1.5bn by 2018, the firm said, which will be largely reinvested to support growth initiatives.

By 2020, Sanofi plans to increase its total annual R&D investment to €6bn.