By Noemie Bisserbe
PARIS-- Sanofi SA on Thursday reported a 68% jump in
second-quarter net profit, buoyed by its biotech business and lower
costs, providing new chief executive Olivier Brandicourt with
momentum in his first few months in the job.
The Paris-based pharmaceutical company said net profit rose to
EUR1.3 billion ($1.43 billion) for the three months through June
from EUR777 million a year earlier.
Business net income, the company's term for adjusted income
excluding the impact of acquisitions and divestments, increased 20%
to EUR1.84 billion, beating analysts' expectations of EUR1.70
billion. Sanofi's total sales rose 16% to EUR9.38 billion.
Sanofi's second-quarter earnings show how the French company has
been able to overcome the expiry of patents on some of its
best-selling drugs by expanding into new areas of business, such as
biotech, animal health and diabetes.
In the second quarter, Genzyme, the company's biotech unit,
posted a 27% rise in revenue to EUR907 million, boosted by strong
sales of Aubagio, a multiple sclerosis drug. Vaccine and animal
drug sales also rose 9% and 14%, respectively in the second
quarter.
But increasing competition in Sanofi's all-important diabetes
market, especially in the U.S., could hamper growth. Diabetes drug
sales, which account for more than 20% of the company's revenue,
fell 4% to EUR1.99 billion, hurt by lower sales of its insulin
Lantus, which lost patent protection in the U.S. in May.
To maintain a firm grip on key markets and boost revenue, Mr.
Brandicourt, who took over as CEO in April, after the abrupt
dismissal of Christopher Viehbacher, will need to successfully
launch a steady stream of new drugs.
Earlier this month, Sanofi won approval from U.S. authorities
for a new cholesterol drug called Praluent, developed jointly with
Regeneron Pharmaceuticals.
The drug, the first of a powerful new class of
cholesterol-lowering medicines, is "poised to become a significant
growth driver for Sanofi," said Mr. Brandicourt in a conference
call with reporters.
The French drug maker already launched at the end of March a new
insulin called Toujeo, which is off to "an encouraging start,"
added Mr. Brandicourt. Toujeo recorded sales of EUR13 million in
the second quarter.
Given the right opportunity, Sanofi may also consider bolt-on
acquisitions to boost growth, said Mr. Brandicourt.
The French drug maker said it still expected business
earnings-per-share to remain stable or grow slightly in 2015,
compared with 2014, at constant exchange rates.
Write to Noemie Bisserbe at noemie.bisserbe@wsj.com
Access Investor Kit for Sanofi
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=FR0000120578
Access Investor Kit for Sanofi
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US80105N1054
Subscribe to WSJ: http://online.wsj.com?mod=djnwires