Sanofi ($SNY) had a good first quarter with higher revenues and profits, but executives acknowledge that with Plavix weeks away from coming off patent, the next 12 months will be tough.
The French company reported a net profit of €1.83 billion ($2.42 billion), up 45%, The Wall Street Journal reports, but said in the remainder of the fiscal year, it expects a 15% hit to earnings.
"We are really about T-minus three weeks from the patent expiry of Plavix in the US. Avapro went at the end of March, and of course we'll see generic activity restart actually in August of this year. But clearly the impact of Plavix is the biggest one," CEO Chris Viehbacher said in a call with analysts. The impact of "losing both Plavix and Avapro to generics is around €1.4 billion for the year. So, Q1 obviously is great because we still have Plavix. You know, the next fourth quarters are certainly going to be impacted by that."
Viehbacher was saying what many other chief executives have had to address in the last two weeks: that with many big-dollar drugs rolling out from behind patent protection, earnings are going to be harder to maintain.
Executives with Novartis ($NVS) and Bristol-Myers Squibb ($BMS) talked with shareholders about that last week.
Veihbacher was able to point to the $20.1 billion acquisition of Genzyme, the largest maker of medicines for rare genetic disorders, as a bright spot going forward. It's a "strong set of results this morning for Sanofi, clearly benefiting not only from the Genzyme acquisition but also from the extremely strong performance of our growth platforms, and as always we've been exercising extremely strong cost control," Viehbacher told reporters.