Sanofi sees end to "patent cliff" doldrums, as it misses forecasts

French drug major Sanofi (Euronext: SAN) posted second-quarter 2013 financial results this morning (August 1) showing that, while the figures were still in negative territory, the company expects to return to growth in the second half of this year. Nevertheless, Sanofi’s shares fell 5.1% to 76.06 euros at around 9 am in Paris.

Net sales for the quarter were down 9.8% (-6.3% at constant exchange rates) to just over 8 billion euros ($10.6 billion), principally impacted by sales lost due to generic competition (481 million euros). Business net income at 1.475 billion euros was 23.4% lower (-18.4% CER) – missing the 1.74 billion euros forecast by 12 analysts polled by Bloomberg 0 and business earnings per share of 1.11 euros were 24.0% (-18.5% CER) lower. Business EPS was impacted in particular by the Plavix (clopidogrel) and Avapro (irbesartan) losses of exclusivity in the USA (0.18 euros) and Brazil generics (0.17 euros).

Commenting on the group’s performance in the second quarter, Sanofi chief executive Christopher Viehbacher said: “The second quarter was a difficult quarter. As expected, this was the last quarter with a tough comparison to the prior year due to the residual impact of the patent cliff. Sales were also affected by our business in Brazil and commercial underperformance in certain business areas. However, sales growth of 7.7% of our growth platforms in the first half of 2013 continues to demonstrate the value of Sanofi’s integrated business model. In addition, we keep on making strong progress in delivering a growing portfolio of high potential R&D assets, as highlighted by the multiple clinical and regulatory milestones reached in the second quarter of 2013. We continue to expect to return to growth in the second half of 2013.”