Sanofi hails China performance, downplays Lantus biosimilar threat in Japan

Sanofi CEO speech

Sanofi’s ($SNY) overall first quarter results were overshadowed by its attempt to buy a U.S. biotech--but the drugmaker was keen to talk about how well it is performing in some of Asia’s biggest markets.

The French Big Pharma--which saw its $9.3 billion takeover attempt of Medivation ($MDVN) blocked on Friday by the Californian cancer drug biotech--was not keen to talk about its bid, but was more open to discuss its success in China, while downplaying the impact of Lantus copycats in Japan.

On its Friday, April 29 Q1 earnings call, Peter Guenter, EVP of general medicine and emerging markets at Sanofi, said the company was “having a very good performance again in the first quarter” in China. This came as a result, he said, “of the right portfolio, the right structure, and a very well performing team in the counties.”

Whether this success is sustainable, Guenter went on to explain: “Now, what the future will bring is probably that not every quarter will look like that--and it's true that we are going through those provincial tenders, that there will be further hospital second bids. So, it's a little bit difficult to predict now.

“The only thing I can say is that, if you look a little bit further down the road, that [health and drug data consultants] IMS projects a growth--a CAGR between now and the end of the decade of 7%--that is more or less in line with the last couple of quarters.

“So, if we stick with that forecast, it would mean that we would probably be in some kind of steady-state for what the market concerns for China.”

But in Japan, Sanofi is now coming under a major sales threat from Biocon’s launch of a biosimilar copycat of its big-selling insulin Lantus.

Pascale Witz, Sanofi’s EVP of diabetes and cardiovascular, said that the biosimilar would itself have to compete alongside its new insulin glargine Lantus XR, which was launched last September in Japan.

This drug is the company’s longer-acting insulin form of Lantus (also known as Toujeo in the U.S.), which it hopes will be more attractive to doctors and patients as it requires fewer injections, and cannot yet be the subject of biosimilar competition.

The Japanese insulin glargine market is estimated to be worth around $144 million--the second largest market outside of North America and Europe. Japan has reported that there were 7.2 million cases of diabetes in the country last year, and this is set to rise.

Witz, however, said that the Japanese market “is the smallest of our three mature markets which we have. So, at this stage, Lantus XR is gradually penetrating the market.”

Sanofi’s total group sales for Q1 reached €8.54 billion ($9.73 billion)--nudging up just 0.7% on the year-ago period at constant exchange rates. This was less than analysts’ consensus estimates of €8.66 billion, with its whole pharmaceuticals unit down 1.4%.

- check out Sanofi’s results