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Sanofi (SNY - Free Report) reported fourth-quarter 2021 adjusted earnings of 78 cents per American depositary share, which beat the Zacks Consensus Estimate of 76 cents per share. Earnings rose 13.1% on a reported basis and 9.8% on a constant currency rate (“CER”) basis.
Net sales in the reported quarter increased 6.5% on a reported basis and 4.1% on a CER basis to $11.39 billion (€9.99 billion), as higher sales of Sanofi’s blockbuster eczema medicine, Dupixent was partially offset by weak vaccine sales. The Consumer business continued its growth momentum in the quarter. Sales, however, missed the Zacks Consensus Estimate of $11.78 billion.
Sales rose 1.8% at CER in the United States and 2.3% in the Rest of the World (includes China, Japan, Brazil and Russia). In Europe, sales increased 9.8%.
All growth rates mentioned below are on a year-on-year basis and at CER.
Segmental Performance
Pharmaceuticals sales rose 7.4% in the quarter to €6.92 billion, driven by the continued strong performance of Dupixent.
Sanofi Specialty Care GBU sales increased 21.3% to €3.49 billion, mainly driven by Dupixent.
In the immunology and neurology franchise, Dupixent generated sales of €1.55 billion in the quarter, up 53.1% year over year. Sales of the drug in the United States rose 45.8%, driven by continued growth in atopic dermatitis and rapid uptake in asthma and chronic rhinosinusitis with nasal polyposis indications. Sales rose 60.9% in Europe and 103.2% in Rest of the world as the company expanded in newer markets and younger age groups.
Aubagio sales declined 1.9% to €478 million, hurt by lower sales in the U.S. market due to competitive launches. Kevzara recorded sales of €91 million in the quarter, up 48.3%, driven by higher demand for IL-6 receptor blockers and a temporary shortage of tocilizumab. Sanofi markets Dupixent and Kevzara in partnership with Regeneron (REGN - Free Report) . While sales are recorded by Sanofi, Regeneron records its share of profits/losses in connection with global sales of Dupixent and Kevzara.
Sales of rare disease drugs rose 9.5% to €818 million. Myozyme sales rose 5.5 % to €254 million. Fabrazyme sales were €223 million, up 9%. Cerezyme sales rose 13.1% to €181 million.
Oncology sales increased 10.3% to €241 million, driven by launches of Sarclisa and Libtayo, which offset the decline in sales of Jevtana. Libtayo sales were €35 million while Sarclisa sales were €54 million. Sanofi has a collaboration agreement with Regeneron for Libtayo. Regeneron records net product sales of Libtayo in the United States, and Sanofi records net product sales of the drug outside the country. Jevtana’s sales declined 16.8% to €110 million due to the entry of generic competition in Europe.
The rare blood disorders franchise recorded sales of €292 million, down 10.4% year over year Sales of Eloctate declined 12.2% to €141 million in the quarter. The new drug, Cablivi recorded sales of €38 million compared with €42 million in the previous quarter.
Sales in General Medicines GBU declined 3.8% to €3.43 billion, as the growth of core drugs (like, Multaq, Lovenox and Plavix) was more than offset by lower sales of non-core drugs.
The Diabetes franchise declined 1.5% to €1.09 billion due to lower sales in Europe and Rest of the World, which offset growth in the United States. Sales of diabetes drugs in the United States rose 10.4%. In Europe, sales declined 4% while in Rest of the World, sales declined 8.8%.
Lantus sales decreased 2.9% to €583 million in the quarter. Toujeo generated sales of €230 million in the reported quarter, up 1.8% year over year.
Sales of Cardiovascular and Established Rx Products came in at €2.12 billion, down 4.5% as higher sales of core assets were offset by lower sales of Lovenox and generics and divestment of non-core products.
Vaccines GBU sales declined 6.5% to €1.96 billion in the quarter mainly due to lower sales of influenza vaccines. Vaccine sales were strong in Europe.
While sales of flu vaccines decreased 12.4%, sales of Polio/Pertussis/Hib vaccines rose 7.7% in the quarter. Meningitis vaccine sales declined 31.2%. Sales of travel and other endemic vaccines rose 17.1% in the quarter. Adult Booster vaccines sales declined 1.6% in the quarter.
Consumer Healthcare (CHC) stand-alone unit generated sales of €1.11 billion, up 5.6%, driven by the strong performance of Cough and Cold, Digestive Wellness and Pain Care categories, which benefited from COVID-19 vaccinations.
Cost Discussion
Selling, general and administrative expenses increased 3.9% at CER in the quarter, reflecting increased investments in Specialty Care, which offset the benefit from cost savings. Research and development expenses increased 2.8% at CER as higher investments behind priority assets were partially offset by efficiencies.
2022 Guidance
Sanofi expects adjusted earnings to grow in a low double-digit range at CER in 2022. It anticipates a positive currency impact in the range of 2%-3% on earnings.
Our Take
Sanofi’s quarterly results were mixed as it beat estimates for earnings while missing the same for sales. Dupixent continued its outstanding performance in the quarter. The drug has, in a very short time, become the key top-line driver for Sanofi. With outside U.S. revenues accelerating and multiple approvals for new indications expected in the near future, Dupixent’s sales are expected to be higher. However, lower sales of vaccines hurt top-line growth in the quarter. The French drug giant’s earnings growth expectations for 2022 are quite encouraging.
Sanofi’s stock has risen 11.7% in the past year compared with the industry’s rally of 22.9%.
Image Source: Zacks Investment Research
In 2021, Sanofi strengthened its R&D capabilities with a series of value-creating M&A transactions, the most important being the acquisition of Translate Bio in September 2021. The Translate Bio deal accelerated Sanofi’s efforts to develop transformative vaccines and therapies using mRNA technology.
Some better-ranked large drug stocks are Pfizer (PFE - Free Report) and Eli Lilly (LLY - Free Report) . While Pfizer has a Zacks Rank of 1, Lilly has a Zacks Rank #2 (Buy).
Pfizer’s stock has risen 58.4% in the past year. Estimates for Pfizer’s 2022 earnings have gone up from $4.59 to $6.41 over the past 60 days.
Pfizer’s earnings performance has been mixed, with the company exceeding earnings expectations in three of the last four quarters while missing in one. PFE has a four-quarter earnings surprise of 10.85%, on average.
Lilly’s stock has risen 23.2% in the past year. Estimates for Lilly’s 2022 earnings have gone up from $8.16 to $8.52 over the past 60 days.
Lilly’s earnings performance has been rather weak with the company exceeding earnings expectations in just one of the last four quarters. Lilly has a four-quarter earnings surprise of 0.54%, on average.
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Sanofi (SNY) Q4 Earnings Beat, Vaccines Hurt Sales Growth
Sanofi (SNY - Free Report) reported fourth-quarter 2021 adjusted earnings of 78 cents per American depositary share, which beat the Zacks Consensus Estimate of 76 cents per share. Earnings rose 13.1% on a reported basis and 9.8% on a constant currency rate (“CER”) basis.
Net sales in the reported quarter increased 6.5% on a reported basis and 4.1% on a CER basis to $11.39 billion (€9.99 billion), as higher sales of Sanofi’s blockbuster eczema medicine, Dupixent was partially offset by weak vaccine sales. The Consumer business continued its growth momentum in the quarter. Sales, however, missed the Zacks Consensus Estimate of $11.78 billion.
Sales rose 1.8% at CER in the United States and 2.3% in the Rest of the World (includes China, Japan, Brazil and Russia). In Europe, sales increased 9.8%.
All growth rates mentioned below are on a year-on-year basis and at CER.
Segmental Performance
Pharmaceuticals sales rose 7.4% in the quarter to €6.92 billion, driven by the continued strong performance of Dupixent.
Sanofi Specialty Care GBU sales increased 21.3% to €3.49 billion, mainly driven by Dupixent.
In the immunology and neurology franchise, Dupixent generated sales of €1.55 billion in the quarter, up 53.1% year over year. Sales of the drug in the United States rose 45.8%, driven by continued growth in atopic dermatitis and rapid uptake in asthma and chronic rhinosinusitis with nasal polyposis indications. Sales rose 60.9% in Europe and 103.2% in Rest of the world as the company expanded in newer markets and younger age groups.
Aubagio sales declined 1.9% to €478 million, hurt by lower sales in the U.S. market due to competitive launches. Kevzara recorded sales of €91 million in the quarter, up 48.3%, driven by higher demand for IL-6 receptor blockers and a temporary shortage of tocilizumab. Sanofi markets Dupixent and Kevzara in partnership with Regeneron (REGN - Free Report) . While sales are recorded by Sanofi, Regeneron records its share of profits/losses in connection with global sales of Dupixent and Kevzara.
Sales of rare disease drugs rose 9.5% to €818 million. Myozyme sales rose 5.5 % to €254 million. Fabrazyme sales were €223 million, up 9%. Cerezyme sales rose 13.1% to €181 million.
Oncology sales increased 10.3% to €241 million, driven by launches of Sarclisa and Libtayo, which offset the decline in sales of Jevtana. Libtayo sales were €35 million while Sarclisa sales were €54 million. Sanofi has a collaboration agreement with Regeneron for Libtayo. Regeneron records net product sales of Libtayo in the United States, and Sanofi records net product sales of the drug outside the country. Jevtana’s sales declined 16.8% to €110 million due to the entry of generic competition in Europe.
The rare blood disorders franchise recorded sales of €292 million, down 10.4% year over year Sales of Eloctate declined 12.2% to €141 million in the quarter. The new drug, Cablivi recorded sales of €38 million compared with €42 million in the previous quarter.
Sales in General Medicines GBU declined 3.8% to €3.43 billion, as the growth of core drugs (like, Multaq, Lovenox and Plavix) was more than offset by lower sales of non-core drugs.
The Diabetes franchise declined 1.5% to €1.09 billion due to lower sales in Europe and Rest of the World, which offset growth in the United States. Sales of diabetes drugs in the United States rose 10.4%. In Europe, sales declined 4% while in Rest of the World, sales declined 8.8%.
Lantus sales decreased 2.9% to €583 million in the quarter. Toujeo generated sales of €230 million in the reported quarter, up 1.8% year over year.
Sales of Cardiovascular and Established Rx Products came in at €2.12 billion, down 4.5% as higher sales of core assets were offset by lower sales of Lovenox and generics and divestment of non-core products.
Vaccines GBU sales declined 6.5% to €1.96 billion in the quarter mainly due to lower sales of influenza vaccines. Vaccine sales were strong in Europe.
While sales of flu vaccines decreased 12.4%, sales of Polio/Pertussis/Hib vaccines rose 7.7% in the quarter. Meningitis vaccine sales declined 31.2%. Sales of travel and other endemic vaccines rose 17.1% in the quarter. Adult Booster vaccines sales declined 1.6% in the quarter.
Consumer Healthcare (CHC) stand-alone unit generated sales of €1.11 billion, up 5.6%, driven by the strong performance of Cough and Cold, Digestive Wellness and Pain Care categories, which benefited from COVID-19 vaccinations.
Cost Discussion
Selling, general and administrative expenses increased 3.9% at CER in the quarter, reflecting increased investments in Specialty Care, which offset the benefit from cost savings. Research and development expenses increased 2.8% at CER as higher investments behind priority assets were partially offset by efficiencies.
2022 Guidance
Sanofi expects adjusted earnings to grow in a low double-digit range at CER in 2022. It anticipates a positive currency impact in the range of 2%-3% on earnings.
Our Take
Sanofi’s quarterly results were mixed as it beat estimates for earnings while missing the same for sales. Dupixent continued its outstanding performance in the quarter. The drug has, in a very short time, become the key top-line driver for Sanofi. With outside U.S. revenues accelerating and multiple approvals for new indications expected in the near future, Dupixent’s sales are expected to be higher. However, lower sales of vaccines hurt top-line growth in the quarter. The French drug giant’s earnings growth expectations for 2022 are quite encouraging.
Sanofi’s stock has risen 11.7% in the past year compared with the industry’s rally of 22.9%.
In 2021, Sanofi strengthened its R&D capabilities with a series of value-creating M&A transactions, the most important being the acquisition of Translate Bio in September 2021. The Translate Bio deal accelerated Sanofi’s efforts to develop transformative vaccines and therapies using mRNA technology.
Zacks Rank
Sanofi currently has a Zacks Rank #5 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Sanofi Price, Consensus and EPS Surprise
Sanofi price-consensus-eps-surprise-chart | Sanofi Quote
Stocks to Consider
Some better-ranked large drug stocks are Pfizer (PFE - Free Report) and Eli Lilly (LLY - Free Report) . While Pfizer has a Zacks Rank of 1, Lilly has a Zacks Rank #2 (Buy).
Pfizer’s stock has risen 58.4% in the past year. Estimates for Pfizer’s 2022 earnings have gone up from $4.59 to $6.41 over the past 60 days.
Pfizer’s earnings performance has been mixed, with the company exceeding earnings expectations in three of the last four quarters while missing in one. PFE has a four-quarter earnings surprise of 10.85%, on average.
Lilly’s stock has risen 23.2% in the past year. Estimates for Lilly’s 2022 earnings have gone up from $8.16 to $8.52 over the past 60 days.
Lilly’s earnings performance has been rather weak with the company exceeding earnings expectations in just one of the last four quarters. Lilly has a four-quarter earnings surprise of 0.54%, on average.