Sanofi SA Q4 2024 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Luisa Hector - Berenberg - Analyst : Hi there. Thanks for taking my question. On the buyback, perhaps you could just comment on the rationale for the size, the EUR5 billion and how soon you might start the buyback? And then any color on plans for the rest of your proceeds? So essentially, just latest thoughts on M&A targets by development stage, therapy area, size, et cetera. Perhaps then I could move to vaccines. I would like to ask some questions, maybe on the pneumococcal vaccine. So the Phase 3 entry, very exciting. Perhaps a bit more color on what you're looking to show in Phase 3 and how you see the competitive landscape because there are others coming forward with vaccines perhaps with higher valency, 24, 31. So how you see a 21 valent vaccine fitting in? Thank you.

Question: Graham Parry - Bank of America - Analyst : Thanks for taking my questions. So firstly, on Dupixent and just the gross to net adjustment in the Q4. Can you just clarify that was just a one-off adjustment catch up for channel mix rebate levels through the whole year of 2025? And just the extent to which that drove the EUR150 million miss, is that just the majority of that compared to, say, invoicing days? And then just any comments you've got on how that could progress into 2025? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 30, 2025 / 2:00PM, SASY.PA - Q4 2024 Sanofi SA Earnings Call And then secondly, on Beyfortus, just given clesrovimab potential for approval this year, possible inclusion in the season, do you are you what are you assuming in your guidance for the year on Beyfortus? Is it expected to grow? And then finally on tolebrutinib, if you could just update us on the indication that you're expecting for tolebrutinib in non-relapsing SPMS. Is it classically defined non relapsing SPMS you're discussing? Or is there any potential here to get a broader label for progression independent of relapse activity? Thank you.

Question: Seamus Fernandez - Guggenheim Securities - Analyst : Hello, thanks very much. I'll just go simple and try to abide by the one question request. So actually, the question is for Paul and Houman, sort of simultaneously, if you each wouldn't mind offering up the catalyst that you're most excited about in 2025 in particular. I think most investors anticipate the results of itepekimab most eagerly but love to just kind of hear your thoughts on maybe your top 3. And if perhaps they might differ slightly, it would be fun to hear that as well. Thanks so much.

Question: Peter Welford - Jefferies - Analyst : Hi. Thanks for taking my questions. I hope you hear me. So I'll ask these two. Firstly, just on Beyfortus, can you just comment there on two things both in terms of you said growth for 2025. Can we expect US growth within your assumption for 2025? And what's regarding the is the actual doses that you shipped at the moment in the US, or indeed other markets, have they been used? Or are there still doses at the moment that are outstanding that are presumably likely to be used during the first part of the year as the season continues? And then secondly, I just wonder if you can comment on the potential for Luncekimig there. I think our catalyst has been pushed into 2026. Is that does that reflect any changes to the data you're awaiting or any change to the Phase 2? Or is that purely just a timing from the point of view of recruiting and getting sufficient data on board for the decision in ASPR Phase 3? Thank you.

Question: Jo Walton - UBS - Analyst : Thank you. Can you hear me?

Question: Jo Walton - UBS - Analyst : Excellent. Mike, I have two questions, please. Firstly, can I push you a little bit more on vaccines? Perhaps you can give us some idea of what you think the penetration today in relevant infants is in the US and what that would be compared to some other, you know, sort of early pediatric vaccines, just to give us a sense of what the upside for the market there is? And also within vaccines, can you tell us, a bit more about the proportion of your sales that go to, let's say, adolescents, with mandates, because I think people are fearful that whilst everyone is going to be allowed the choice to have a vaccine going forwards, perhaps some of the mandates that really pushed people to vaccination may weaken, anything to do with individual choice, and you do tend to see lower vaccination rates. So, I'd like you to discuss that a little bit in more detail, if you could. And could you also just please tell us a little bit more about healthcare reform in the US, your assumption of how much more you're going to have to pay for the Part D for those patients who are in catastrophic cover? And REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 30, 2025 / 2:00PM, SASY.PA - Q4 2024 Sanofi SA Earnings Call whether you see any offsets in terms of increased volume from lower patient co pays, more adherence, for example, for things like Dupixent in the elderly.

Question: Richard Vosser - J.P. Morgan - Analyst : Hi, thanks for taking my questions. Two, please. One on amlitelimab Just as we think about the asthma data that's coming up and the 12-week dosing, could you just talk through your level of confidence that you'll see no detrimental reduction in efficacy there through the data? And then secondly, question on itepekimab. Obviously, Dupixent in COPD has a broader label. The launch is going exceptionally well from the script trends. But what implications does that have for the residual opportunity for itepekimab in COPD? Thanks very much.

Question: Florent Cespedes - Bernstein - Analyst : Good afternoon. Florent Cespedes from Bernstein. Two questions, please, on the pipeline. First on R&D budget. With a long list of Phase 2 products, so how will you manage the R&D budget going forwards? Good problem to have, but any color would be great. And my second question is for Thomas. We see more and more vaccines projects on the pipeline and on the new slot tables. I like the Phase 3 and the RSV for toddlers. Could you maybe elaborate a bit even though for 2026, but how you see these projects nicely, good addition to your existing RSV franchise? Thank you.

Question: David Risinger - Leerink Partners - Analyst : Yes. Thanks very much, and congrats on all the strong business momentum. So my two questions are, first, what amount of nuvaxovid sales are factored into 2025 sales guidance? And second, should we expect top line press releases on Phase 2 trial results? Or will we need to wait for you to provide updates on them in conjunction with quarterly results calls? Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 30, 2025 / 2:00PM, SASY.PA - Q4 2024 Sanofi SA Earnings Call

Question: Peter Verdult - BNP Paribas Exane - Analyst : Hello, sir. How are you? Okay, it's Peter Verdult here from BNP Paribas Exane. Two questions. Houman, just on TL1A, really interesting asset in light of your data in UC and particularly at Crohn's and also given the market seems to describe all the value of this class to competing assets. So recent KOL checks point to biomarker led strategies being keenly sought. So I'm just seeking confirmation from you and your partner, Teva, that a biomarker will be deployed in your Phase III program, timings on the Phase 3 start and whether you're considering going beyond IBD in your clinical development program? And then a very quick one for Francois on Dupixent, just simply on profitability dynamics in light of the COPD launch accelerating volumes and the manufacturing changes that you're putting through? The simple question, Francois, I'm not asking for numbers, but just will 2025 be a significant sort of gross margin driver as it relates to Dupixent? Or do we need to be a little bit more conservative and wait until 2026? Thank you.

Question: Steve Scala - TD Cowen - Analyst : Thank you so much. Also on TL1A, has the best-in-class profile held up when the data is cut by biologic naive and biologic experienced patients? So that's the first question. And secondly, are you highly confident FDA will not ask for additional data such as the PPMS data for approval of tolebrutinib. And is the every week monitoring for three months likely to be what's in the label? Thank you.

Question: Emmanuel Papadakis - Deutsche Bank - Analyst : Thanks for taking the question. Yeah, Emmanuel Papadakis, Deutsche Bank. So maybe a question for Francois on the outlook for the operating margin. Just talk a little bit about potential for margin leverage. I know it's presumably we should see revenue growth beyond well beyond 2025. We obviously have some financial considerations to take into account, the Regeneron co development lines, royalty lines perhaps. Just your thoughts on whether steady modest margin improvement in the midterm is a reasonable assumption? And then maybe a question for Herman on one of the handful of Phase 2 -- interesting Phase 2 data points are due this year. But balinatunfib, the oral TNF. The Phase 1 data last year showed moderate efficacy. You've emphasized the potential as a combination opportunity with biologics. In that setting, we do this right to say it relatively soon. What are you hoping to see in that? And is the plan to take it forward now as a biologics combination Phase 3? Thank you.

Question: Eric Le Berrigaud - Stifel Financial Corp - Analyst : Yes. Good afternoon. Thank you. Two questions. First on SARCLISA. Any chance to get a better understanding of what your ambition is with the drug? It's a two-player market where the other guy is having 95% market share. So if you are successful in closing the gap could be an exceptional opportunity for you. But it was first about data and now you have the data. It was then about formulation, you will soon have formulation. So probably the remaining question is the willingness to invest and support on the commercial side, a relaunch or a stronger launch based on those data. So where are you? What's the market intelligence is telling you? Is it too late? Is it becoming too much your market or you're not having too much time given patent Blackstone Royalties, anything to help us understand whether it can be a blockbuster for sure, but a multi-blockbuster, maybe. And the second question, a very short one, given the current dynamics with ALTUVIIIO, is that one your next blockbuster and no later than this year? Thank you.

Question: Ricardo Benevides Freitas - Santander Bank - Analyst : Hello, everyone. Thank you for taking my question. Wanted to ask you regarding your outlook on tariffs. The Trump administration has openly stated that it has been considering placing tariffs on both APIs and pharmaceuticals. Right now, we know that the tariff outlook is still a bit uncertain. But could you give us some light on how your top line or operating income could be affected if either 2.5% universal tariffs are implemented or more aggressive 25% tariffs to China are applied? And in more qualitative terms, how could you protect yourself against these measures? Post potentially increased production activity in the US? Try to ration for any potential medicine shortages? Thank you.