Sanofi

Company Update:
Sanofi faces yet another R&D setback. Now the firm did not see enough efficacy for its phase III drug Riliprubart targeting a rare neurological disease called CIDP (chronic inflammatory demyelinating polyneuropathy), and therefore its phase III trial would be halted. Had it cleared regulatory hurdles, Riliprubart could have been a multi-blockbuster product for Sanofi. This is why we expect a negative reaction in the share price today.

Sanofi has been struggling for years now to 1/ revive its R&D engine and 2/ find suitable successor(s) to its key immunology drug Dupixent (c.35% of sales). We doubt if the new CEO would have any quick fixes for this ailment of Sanofi. While we have a positive recommendation, the share price recovery prospects remain elusive, as does meaningful success in late-stage clinical trials.

Expert Opinion:
Sanofi is the cheapest stock in our pharma universe. Yet, it is difficult to find catalysts that could revive the equity story. There are better opportunities in my opinion. We stick to our long positions in Novo Nordisk (concerns about structural market-share loss in the weight-loss markets are excessive) and Roche (high-quality assets that are not properly valued).



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