Sanofi CEO Hudson singles out his digital ambitions in big executive shakeup

When Sanofi CEO Paul Hudson laid out his aggressive plan for remaking the French pharma giant last December, he vowed to simplify the company’s management structure. Yesterday, he took a big step toward making good on that promise.

Sanofi bid farewell to four top executives, a spokeswoman confirmed in an email to FiercePharma. They include Ameet Nathwani, who was appointed chief medical officer in 2016, and then took on the additional role of chief digital officer last year. One of Nathwani’s major initiatives was a partnership with Google centered around developing new technologies like digital therapeutics, and helping Sanofi integrate AI into its operations.

The shakeup came just a few days after Hudson said during Sanofi’s fourth-quarter earnings call that he intended to shrink the executive committee from 14 to 10 people. His hope is “to allocate more of our central expertise into our business units and increase the accountability,” he said.

But boosting Sanofi’s digital capabilities is clearly on Hudson’s mind as he renovates the executive suite. Hudson said during the earnings call that rather than having a hybrid chief medical and digital officer the company would “single out” the digital piece.

“We have done that because I think we are a little bit behind in our agenda on the digital understanding and language capability internally,” he said. “So in the short to medium term, that role will have a bias towards helping us improve our user experience and data science management internally.”

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Hudson has always been a champion of using technology to bolster drug discovery and development. At Novartis, he was key in helping put in place an AI program for salespeople. Ever since he took over Sanofi last fall, he hasn’t been shy about saying he wants every employee to master the art of making decisions that are backed by data and analytics.

And Hudson doesn’t think pharma companies necessarily need to partner with tech giants to get it done. It's "great to develop digital externally, but what about being a digital company?" he said during an event at Sanofi’s headquarters last October.

In fact, in December, Sanofi pulled back from its relationship with Google’s sister company Verily. The two companies had set up a diabetes partnership, Onduo, in 2016, with each pitching in $500 million. Now, as Hudson is paring down diabetes R&D, Sanofi will restructure the joint venture. It will continue to back it financially but will no longer be involved in operations.

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Also headed for the exits at Sanofi are Dieter Weinand, who heads up primary care; Dominique Carouge, head of business transformation; and Kathleen Tregoning, external affairs chief.

No doubt Hudson sees the changes as key to another big goal: refocusing the company on high-growth areas, including immunology, cancer and rare diseases. His priorities there include Dupixent, the Regeneron-partnered drug to treat asthma, eczema and nasal polyps. Hudson said during the fourth-quarter report that he expects sales of the product will grow from €2.07 billion last year to €10 billion.

But investors are also counting on Hudson to improve Sanofi’s approach to innovation. Last year, 78% of the company’s sales came from products that are over 10 years old, analysts at Vantage pointed out in a report released last month. If Hudson’s makeover doesn’t work, they said, Sanofi will be almost as reliant on old drugs five years from now.

Investors “must hope that the sweeping strategy review announced by [Hudson] signals the turning of this big pharma tanker,” Vantage said.