Sanofi has posted financials for the third quarter this morning which show that net profit slipped 3.0% to 2.40 billion euros, while sales edged up 5.0% to 8.75 billion euros.
Pharmaceuticals were up 10.0% to 6.94 billion euros, a reasonable result given the scale of generic competition to key products. The antithrombotic Lovenox (enoxaparin) saw sales fall 12.7% to 494 million euros, while the bloodthinner Plavix (clopidogrel), partnered with Bristol-Myers Squibb, brought in 517 million euros to Sanofi’s coffers, up 3.8%, despite generics hitting European sales by 21%.
Patent expiries meant that the cancer drug Taxotere (docetaxel) slumped 64.8% to 186 million euros, while the Ambien (zolpidem) sleep franchise sank 43.6% to 121 million euros.
On the bright side, the Paris-headquartered firm's diabetes division contributed 1.16 billion euros (+12.4%), and Lantus (insulin glargine) made up 968 million euros of that, a rise of 14.6%. The new anti-arrhythmic Multaq (dronedarone) brought in 66 million euros, up 52.2%, while sales of Jevtana (cabazitaxel) for prostate cancer came in at 45 million euros, an increase of 14.6%.
Regarding its older products, the antihypertensive Avapro/Avalide/Karvea (irbesartan) also partnered with B-MS, fell 15.2% to 434 million euros, hit by the arrival of generic versions of Merck & Co's rival drug Cozaar (losartan). However, sales of the colorectal cancer drug Eloxatin (oxaliplatin) were up 179.2% to 310 million euros. The latter rise was due to Sanofi winning a patent battle in September with India's Sun Pharmaceuticals that will keep generic versions of Eloxatin off the US market until August 2012.
Sales at Sanofi’s vaccines division climbed 16.7% to 1.34 billion euros, while the consumer healthcare business brought in 665 million euros (+20.3%). Revenues from the generics unit rose 9.2% to 410 million euros.
Solid growth at Genzyme
As for the financials at recently-acquired Genzyme Corp which show that revenues grew 6.9% to $768 million. Cerezyme (imiglucerase) for Gaucher disease was up 7.0% to $141 million and Fabrazyme (agalsidase beta) for Fabry disease increased 24.9% to $32 million. Supplies of the two therapies are still suffering the effects of the temporary closure of the firm's Allston Landing, Boston facility in June 2009.
Sales of Lumizyme/Myozyme (alglucosidase alfa) for Pompe disease grew 27.2% to $101 million, while the sevelamer-based kidney disease treatments Renagel and Renvela brought in 135 million euros, up 6.7%.
Chief executive Chris Viehbacher (pictured) said that “the return to growth in sales and earnings in the third quarter reflects an important milestone as the company progressively puts the patent cliff behind it". He added that the integration of Genzyme is progressing well and the firm's growth platforms "more than compensated for generic erosion".
Mr Viehbacher said that "we continue to make strong progress in R&D with the submission of five new products and also in the tight control of our costs".
Jobs to go in USA, followed by Europe
Staying with cost-cutting, Sanofi has announced a major restructuring in North America, where it employs around 18,000 people. The move is being driven by the integration of Genzyme, generic competition and the effects of healthcare reform across the Atlantic.
The firm is consolidating North American drug-discovery and early-development operations in Boston, the home of Genzyme and creating a new drug development centre at its North American headquarters in Bridgewater, New Jersey.
As a result, Sanofi will close an existing R&D site in Bridgewater in the fourth quarter of next year. No figures in terms of job losses has been specified but it will be trimming its sales forces in the areas of cardiovascular and oncology.
Plans to restructure in Europe are underway and Sanofi says it has begun a consultation process in Germany, Hungary, Italy, the UK and the Netherlands.