Sanofi ($SNY) CEO Olivier Brandicourt and his executive team had good words to say about business in China and emerging markets for therapies in the chronic disease category, helping the company's pharma operations jump a whopping 16% in currency-adjusted gains in the Middle Kingdom as it expanded further into second-tier cities.
Peter Guenter, executive vice president for global commercial operations, said emerging markets did well across regions, but particularly so in China with third-quarter growth on pharma, which was double the 8% gain seen in the first quarter.
"And actually, again, it is very, very consistent. We have very good performances with our cardiovascular, and so basically Plavix and Aprovel. Diabetes portfolio, Lovenox is growing well; Depakine is growing well. And even our oncology business unit is doing well with Eloxatin and Taxotere, also partly benefiting from label extensions on Eloxatin last year," Guenter said in response to an analyst question on the gain.
"I think the reasons, of course, are notable of that outperformance of the market, by the way, which is actually pretty strong. I think we have an ideal portfolio for China and we're basically treating chronic diseases. We are less subject to markets like, for example, antibiotics that go down faster than markets like diabetes."
In China, when combined with vaccine sales, Sanofi reached €593 million in sales. Overall in emerging markets Sanofi saw a currency adjusted gain of 11% in the third quarter.
In the coming quarters however, Guenter cautioned that reform winds blowing could change the scene, particularly a government plan to reduce the reliance of patients on big city hospitals and to get them into clinics first.
"Now, in terms of outlook, it is a bit difficult really to understand exactly how this is going to play out today in China. Besides, of course, the economic outlook, you know that a couple of reforms have been taken in that market this year, and then actually it is not so easy to predict. But of course, obviously, price pressure in China that has already started in the past, which is actually not very new, is of course predicted to continue."
However, Japan sales of Plavix were hard hit, down 24% as generic competition ate market share, with overall sales in the country down 11% to €458 million in pharma and down 39% for vaccines.
Brandicourt also updated on dengue, noticeably more upbeat than Olivier Charmeil, executive vice president for vaccines.
"As I mentioned last quarter, we continue to expect the first license to market our dengue vaccine before year end," Brandicourt said. "This is a breakthrough innovation designed to help reduce the worldwide burden of dengue. Launch preparations are fully on track, and with the expected first wave of launches in endemic countries planned for 2016, we are aiming to maximize the impact of this new vaccine on public health through broad vaccination programs."Sanofi's Olivier Charmeil
Charmeil however said don't start counting the euros too quickly.
"With regard to dengue, as we had indicated in the previous quarterly calls, we are expecting to get the first license by the end of this year," he said in response to an analyst query. "It could be one, two countries. Difficult to say whether we are going to have sales this quarter for dengue. It will depend on exactly when we get the first license. What you should keep in mind, should we get sales, it's going to be very, very minimal, but we are expecting to get license for dengue this quarter."