Sanofi's blockbusters take a hit

Generic pressures, European pricing pressures and the impact of the US health reforms combined to dent Sanofi-Aventis’s growth in the second quarter, with pharmaceutical sales falling slightly.

But the company’s desire to acquire a small to medium sized company, with Genzyme rumoured to be its intended target, remains unabated.

Chief executive Christopher Viehbacher, said: “I’m pleased with the Group’s quarterly performance in an environment impacted by the US healthcare reform, price cuts in Europe and continued competition from generics. During this quarter, we also received US approval for [chemotherapy agent] Jevtana.

“Our objective to enhance innovation in R&D is on track, thanks to both internal transformations and numerous partnerships and acquisitions.”

Sanofi’s net pharma sales in the second quarter reached €7.0 billion, down 1.2% on constant exchange rates, though first half sales remained almost flat at -0.1 per cent.

Sales of anti-clotting agent Plavix continued to struggle under generic pressures in Europe, falling by over 27% to €538 million, and its chemotherapy agent Eloxatin also felt the pressure with sales down 76.2% to €94 million. 

Its insulin product Lantus remained the company’s best selling product, up a healthy 10.6% to 926 million for the quarter. Lovenox, its second biggest seller was up a more modest 5.5% to €866 million, but with a generic version just approved in the US earnings are set to suffer later in the year.

Genzyme merger

Meanwhile, the rumours of a $19 billion acquisition of troubled US biotech firm Genzyme gathered pace, with Viehbacher reiterating that one of Sanofi’s top three priorities was to “pursue external growth including a focus on mergers and acquisitions of small to medium-sized companies with market capitalisation of up to $20 billion”.

According to reports in The Financial Times, the board of Sanofi has authorised Viehbacher to go public with the company’s interest in Genzyme if necessary. Yesterday it quoted people familiar with the matter saying that Genzyme’s board is divided on the merits of entering into negotiations.

Genzyme develops orphan drugs for rare conditions including Fabry Disease and Gaucher’s Disease but has fallen from grace in the past year after a series of manufacturing problems dented confidence and sales of its core products.

In second quarter results released earlier this month, Genzyme’s sales took an 11% knock, but the company is confident it can restore near full manufacturing capacity in 2011.

Ben Adams