Sanofi supply-chain problems have again undermined the French drugmaker's earnings. Last year it was supplies of generic drugs in Brazil and then its inability to get enough vaccine to the U.S. This time around it is problems with being able to meet vaccine demand in a couple of emerging markets.
Just 6 months after problems at a Toronto plant for pertussis-containing vaccines battered Sanofi's ($SNY) earnings, the drugmaker reported that delays in getting its Pentaxim vaccine to China and Mexico had shaved 4.2% off of the expected revenue from its vaccine unit. It cut sales to €628 million ($870.1 million), putting a damper on its total profit and sales tallies. Revenues from its polio/pertussis/Hib vaccines, which include Pentaxim, Pentacel and Imovax, were down nearly 16% to €211 ($291.7 million).
In its third quarter of last year Sanofi took a 7.2% hit to its vaccines sales when it couldn't get sufficient supplies of its pertussis-containing vaccines to the U.S. market for the fall vaccine season. Work that had to be done at its Sanofi Pasteur vaccine plant in Toronto after the FDA savaged it in a warning letter in 2012 created the supply delay. The plant had a mold issue after flooding there in 2012. The company today was not specific as to whether the problems meeting demand in China and Mexico were tied to the Toronto plant but did say that declines in vaccine sales "reflected continued gradual Pentacel recovery" in the U.S.
In the second quarter last year, Sanofi missed analyst projections, in part because of what it termed the "Brazil generics issue." In that supply-chain related case, its Medley unit there presold too much product in an effort to try to beat a rise in Brazil's value-added tax, overwhelming demand and resulting in expired products being returned.
- here's Sanofi's earnings release (PDF)