By Bhanvi Satija and Dominique Patton
LONDON, July 30 (Reuters) – Sanofi raised its full-year sales forecast on Thursday on strong demand for blockbuster drug Dupixent, but its shares fell 8% as investors focused on pipeline cuts and one-off gains.
Shares in Sanofi were on track for their worst performance since September 2025, when eczema drug amlitelimab failed in a key study, after the drugmaker’s first results under its new chief executive Belén Garijo, who took charge in May.
The French company’s efforts to secure growth beyond 2030 once Dupixent loses patent exclusivity are closely watched by investors after the discontinuation of amlitelimab led to a €952 million ($1.09 billion) impairment first-half charge.
“The strategic review of our late-stage pipeline is still ongoing,” said Garijo, adding she was no longer in a “diagnosis phase” and would maintain a fast decision-making pace.
Sanofi said it would also scrap the development of lung disease treatment itepekimab and psoriasis drug balinatunfib.
“The bigger Dupi gets, the bigger the hole is that Sanofi needs to fill when it loses patent protection,” UBS analysts wrote in a note following Thursday’s results.
Cosmetics giant L’Oreal, a major Sanofi shareholder, on Thursday ruled out selling its stake in the drugmaker, whose shares trade at a discount to European rivals such as AstraZeneca and Novartis.
“Sanofi is a financial asset … bringing in €365 million of dividend. I think it’s wise for the time being to keep it like this,” L’Oreal CFO Christophe Babule told analysts.
Garijo has overhauled her executive team in the quest for growth, expanding the role of finance chief François-Xavier Roger to also lead business development at Sanofi, which some analysts estimate has €20 billion in deal-making firepower.
Roger said that while Sanofi historically targeted acquisitions in the $2 billion to $5 billion range, it now holds “a little bit of a larger view”, although transaction size is not the primary criterion.
UBS praised Sanofi’s management for clearing out non-competitive assets.
Sanofi expects sales to grow by 10% at constant exchange rates in 2026, compared with its previous forecast of high-single digits. It continues to expect business operating income to grow slightly faster than sales.
Garijo has also appointed former Roche executive Paulo Fontoura to lead Sanofi’s R&D overhaul from September 1.
“The focus now has to be on reinvesting Sanofi’s strong cash flow into new pipeline drivers,” the UBS analysts said.
ONE-OFF GAINS
Second-quarter business operating income rose to €3.29 billion, above average analyst estimates of €2.96 billion. Quarterly revenue of €11.60 billion also beat the €10.85 billion estimate.
Sales of Dupixent, on which Sanofi partners with Regeneron, rose 38% to €5.15 billion. Sanofi expects annual sales of €25 billion in 2030 for Dupixent, just above analysts’ forecasts of €24.2 billion.
Vaccine sales, however, fell 4.7% to €1.1 billion, hurt by a birth-rate decline in China that hit pediatric demand and tough comparisons for flu shots.
Analysts at Berenberg estimated up to half of the quarterly beat was driven by one-time benefits, including a €200 million U.S. rebate adjustment for Dupixent.
R&D expenses for the quarter rose 18% to €2.23 billion, inclusive of wind-down costs.
($1 = 0.8735 euros)
(Reporting by Bhanvi Satija; Editing by Muralikumar Anantharaman, Clarence Fernandez, Tomasz Janowski and Alexander Smith)
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