Back to top

Image: Bigstock

Sanofi (SNY) Q1 Earnings Top, Vaccines Recover, CHC Sales Rise

Read MoreHide Full Article

Sanofi (SNY - Free Report) reported first-quarter 2022 adjusted earnings of $1.09 per American depositary share, which beat the Zacks Consensus Estimate of 94 cents per share. Earnings rose 20.5% on a reported basis and 16.1% on a constant currency rate (“CER”) basis.

Net sales in the reported quarter increased 12.6% on a reported basis and 8.6% on a CER basis to $10.86 billion (€9.67 billion) on higher sales of Sanofi’s blockbuster eczema medicine, Dupixent. The Consumer business continued its growth momentum in the quarter. Sales beat the Zacks Consensus Estimate of $10.33 billion.

Sales rose 12.1% at CER in the United States and 7% in the Rest of the World (including China, Japan, Brazil and Russia). In Europe, sales increased 6.7%.

All growth rates mentioned below are on a year-on-year basis and at CER.

Shares of Sanofi have gained 8.4% in the year so far compared with the industry’s increase of 3.8%.

Zacks Investment Research
Image Source: Zacks Investment Research

Segmental Performance

Pharmaceuticals sales rose 7.5% in the quarter to €7.33 billion, driven by the continued strong performance of Dupixent.

Sanofi Specialty Care GBU sales increased 17.8% to €3.57 billion, mainly driven by Dupixent.

In the immunology and neurology franchise, Dupixent generated sales of €1.61 billion in the quarter, up 45.7% year over year. Sales of the drug in the United States rose 38.1%, driven by continued growth in atopic dermatitis and rapid uptake in asthma and chronic rhinosinusitis with nasal polyposis indications. Sales rose 53.3% in Europe and 88% in Rest of the world as the company expanded in newer markets and younger age groups.

Aubagio sales declined 6.6% to €491 million, hurt by lower sales in the U.S. market due to competitive launches and pricing pressure. Kevzara recorded sales of €95 million in the quarter, up 61.4%, 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 1.9% to €804 million. Myozyme sales declined 3% to €235 million. Fabrazyme sales were €22 million, up 2.4%. Cerezyme sales fell 6.7% to €165 million.

Oncology sales increased 6.8% to €244 million, driven by the launch of Sarclisa, which more than offset the decline in sales of Jevtana. Libtayo sales were up 53.8% at €41 million while Sarclisa sales gained 85.3% to €65 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 25.4% to €98 million due to the entry of generic competition in Europe last year.

The rare blood disorders franchise recorded sales of €293 million, up 1.8% year over year. Sales of Eloctate declined 3% to €138 million in the quarter. The new drug, Cablivi recorded sales of €46 million compared with €38 million in the previous quarter.

Sales in General Medicines GBU declined 0.7% to €3.76 billion, as the growth of core drugs (like Multaq, Toujeo, Praluent and Rezurock) was more than offset by lower sales of Lovenox.

Lantus sales decreased 1.5% to €671 million in the quarter. Toujeo generated sales of €274 million in the reported quarter, up 6.3% year over year.

Vaccines GBU sales gained 6.8% to €1.02 billion in the quarter, mainly due to strong demand for Polio/Pertussis/Hib vaccines and partial recovery in demand for travel vaccines.

While sales of flu vaccines decreased 18.2%, sales of Polio/Pertussis/Hib vaccines rose 10.3% in the quarter. Meningitis vaccine sales declined 16.4%. Sales of travel and other endemic vaccines rose 61% in the quarter. Adult Booster vaccine sales increased 4% in the quarter.

The Consumer Healthcare (CHC) stand-alone unit generated sales of €1.33 billion, up 17%, driven by the strong performance of the Cough and Cold, Digestive Wellness and Pain Care categories.

Cost Discussion

Selling, general and administrative expenses increased 4.3% at CER in the quarter, reflecting increased investments in Specialty Care, which offset the benefit from cost savings. Research and development expenses increased 14% at CER as higher investments behind priority assets along with costs related to the recent acquisitions to boost the pipeline.

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 4%-5% on earnings, at average of exchange rates in April.

Sanofi Price, Consensus and EPS Surprise

Sanofi Price, Consensus and EPS Surprise

Sanofi price-consensus-eps-surprise-chart | Sanofi Quote

Zacks Rank & Stocks to Consider

Sanofi currently carries a Zacks Rank #3 (Hold). A couple of better-ranked stocks in the biotech sector are Trevi Therapeutics (TRVI - Free Report) and Voyager Therapeutics (VYGR - Free Report) , both carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Trevi’s 2022 and 2023 loss has narrowed 19.4% and 14.1%, respectively, over the past 60 days. TRVI has surged 281% so far this year.

Earnings of Trevi surpassed estimates in two of the trailing four quarters and missed twice, the average beat being 5.09%.

Estimates for Voyager’s 2022 and 2023 loss have narrowed 38.6% and 29%, respectively, over the past 60 days. VYGR has rallied 168.6% so far this year.

Earnings of Voyager surpassed estimates in three of the trailing four quarters and missed once, the average beat being 41.00%.