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Forward Looking Statements
This presentation contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements are statements that are not historical facts. These statements include projections and estimates and their underlying assumptions, statements regarding plans, objectives, intentions and expectations with respect to future financial results, events, operations, services, product development and potential, and statements regarding future performance. Forward-looking statements are generally identified by the words “expects”, “anticipates”, “believes”, “intends”, “estimates”, “plans” and similar expressions. Although Sanofi’s management believes that the expectations reflected in such forward-looking statements are reasonable, investors are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of Sanofi, that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements.These risks and uncertainties include among other things, the uncertainties inherent in research and development, future clinical data and analysis, including post marketing, decisions by regulatory authorities, such as the FDA or the EMA, regarding whether and when to approve any drug, device or biological application that may be filed for any such product candidates as well as their decisions regarding labelling and other matters that could affect the availability or commercial potential of such products candidates, the absence of guarantee that the products candidates if approved will be commercially successful, the future approval and commercial success of therapeutic alternatives, the Group’s ability to benefit from external growth opportunities as well as those discussed or identified in the public filings with the SEC and the AMF made by Sanofi, including those listed under “Risk Factors” and “Cautionary Statement Regarding Forward-Looking Statements” in Sanofi’s annual report on Form 20-F for the year ended December 31, 2010. Other than as required by applicable law, Sanofi does not undertake any obligation to update or revise any forward-looking information or statements.
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Agenda
2008-2011 Transformation
● Christopher A. Viehbacher, Chief Executive Officer
2008-2011 Financial Discipline
● Jérôme Contamine, Executive Vice President, Chief Financial Officer
2012-2015 Key Drivers of Growth Platforms
● Emerging Markets Hanspeter Spek President, Global Operations
● Diabetes Pierre Chancel Senior Vice President, Diabetes
● Vaccines Olivier Charmeil Senior Vice President, Vaccines
Break
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Agenda (cont’d)
2012-2015 Key Drivers of Growth Platforms (cont’d)
● Genzyme David Meeker, MD Chief Operating Officer, Genzyme
● Merial Jose Barella Chief Executive Officer, Merial
● Consumer Health Care Hanspeter Spek President, Global Operations
2012-2015 Financial Indicators & Capital Allocation
● Jérôme Contamine, Executive Vice President, Chief Financial Officer
2012-2015 Growth Outlook
● Christopher A. Viehbacher, Chief Executive Officer
Wrap up and Q&A
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2008-2011 TRANSFORMATION
Christopher A. Viehbacher
Chief Executive Officer
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Objectives for Today
Highlights of key achievements to date
Evolution of our growth platforms
Capital allocation and commitment to shareholder return
Growth perspectives beyond the patent cliff
1
2
3
4
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Agenda
Industry transformation
Strategy we are executing
The new Sanofi
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2008-2011
The Pharmaceutical Industry Has Demonstrated Resilience
● Geographic expansion
● Diversification outside large branded Rx drugs
● Increased Business Development
● More focus on operating efficiency
● New approaches to R&D
Industry Responses
● Significant patent cliff looming
● Fewer new blockbusters
● Cost containment (e.g. U.S. healthcare reforms and EU price cuts)
● Increased regulatory hurdles
● Reimbursement challenges
Pressures on Industry
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2008-2011
The Sector Offers Attractive FCF and Dividend Yields
(1) Actelion, Elan Corp, William Demant Hol, Shire, Straumann Hldg, Fresenius SE, Fresenius Med Care, Coloplast, Synthes Inc, Biomerieux, Essilor Intl, Smith & Nephew, Novo Nordisk AS, Merck KGAA, Getinge AB, Nobel Biocare AG, H.Lundbeck A/S, UCB, Ipsen, Celesio AG, Novartis AG, Sanofi, Roche Hldgs AG, GlaxoSmithKline, AstraZeneca Source: Broker data
European Healthcare Sector(1) Yields (%)
0
2
4
6
8
10
Jan-
88
Jan-
89
Jan-
90
Jan-
91
Jan-
92
Jan-
93
Jan-
94
Jan-
95
Jan-
96
Jan-
97
Jan-
98
Jan-
99
Jan-
00
Jan-
01
Jan-
02
Jan-
03
Jan-
04
Jan-
05
Jan-
06
Jan-
07
Jan-
08
Jan-
09
Jan-
10
Jan-
11
Free Cash Flow YieldDividend Yield
9.4%
4.2%
9
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2008-2011 Pharma Sector Offered One of Highest TSR in Last 3 Years
-1.0%
-20.0%
11.0%10.3%
5.0%
-10.2%-10.7%-11.8%
-18.2%
-22.9%
Total Shareholder Return (including distributions reinvested in equity; three years to Aug 2011)
Total Shareholder Return (including distributions reinvested in equity; three years to Aug 2011)
Source: FactSet as of August 26, 2011(1) MSCI indices(2) Includes AstraZeneca, Bristol-Myers Squibb, Sanofi, Merck & Co, GlaxoSmithKline, Bayer, Novartis, Pfizer, Johnson & Johnson, Abbott Laboratories, Roche Holding and Eli Lilly & Co. on an equal-weight basis
Pharma(2)Banks(1) CapitalGoods(1)
ConsumerDurables
& Apparel(1)Energy(1) Media(1)Telco
Services(1)Utilities(1) CAC 40 S&P 500
Equity indices
Confident in resilience of the pharma sector in a volatile economic environment
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Agenda
Industry transformation
Strategy we are executing
The new Sanofi
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2008-2011
Repositioning Sanofi for Sustainable Growth
2005-2008 2009-2011 2012 onwards
Focusing on Rx Blockbusters Transforming
GeneratingSustainable Growth
• Investing in growth platforms• Increasing diversification• Managing patent cliff
• Growing recurring sales• Improving risk profile
• Blockbuster drugs• Patents challenged• R&D setbacks
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2008-2011
Three Point Strategy We Are Executing
Sustainable earnings growth
beyond 2012
Adapt structure for futurechallenges and opportunities3
Pursue external growth opportunities2
Increase innovation in R&D1
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Improving R&D: A Clear Progress1
● Stress-test R&D portfolio
● Keep tight control of total R&D spend
● Reduce infrastructure costs
● Rigorous decision making process
● Open innovation In progress
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Increasing Innovation in R&D
12 fewer R&D pharma sites (from 26 to 14) and 22% headcount reduction in 2011e vs. 2008
Restructuring the organization
Focusing on high-value projects2 new products filed mid-2011
Opening up to external innovationMultiple networks of excellence
A new R&Dapproach
New head of R&D: Dr. Elias Zerhouni
New governance policy
1
1515
4 new drug filings expected before end Q1 201219 potential new launches before end 2015
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Pursuing External Growth Opportunities
● Acquired 23 companies including Genzyme
● Completed 61 in-licensing agreements
● Entered 2 joint ventures
● Invested a total of ~€23bn in external growth
2
Since January 2009:
Added 20%to 2011e
consolidated sales growing to ~30%
in 2015
Demonstrated integration capabilities
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3
~ x1.5
2011e2008
€3.1bn
DiabetesSolutions
~ x1.5
2011e2008
€6.5bn
EmergingMarkets(2)
~ x1.2
2011e2008
€2.9bn
HumanVaccines
~ x2.4
2011e2008
€1.2bn
ConsumerHealth Care
~ x2.3
2011e2008
Animal Health(3)
2011e2008
InnovativeProducts
€0.9bn
Adapting Sanofi around Growth Platforms(1)
(1) Expected sales are based on 1€=1.40$(2) Excluding Genzyme(3) 50% of Merial sales in 2008
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Transforming our Organization with a Renewed Management Team with Significant Global Experience
3
Karen LinehanSenior VP, Legal Affairs & General Counsel
Christopher A. ViehbacherChief Executive Officer
Jérôme ContamineExecutive VPChief Financial Officer
Elias ZerhouniPresidentGlobal R&D
Olivier CharmeilSenior VPVaccines
Hanspeter SpekPresidentGlobal Operations
Roberto PucciSenior VPHuman Resources
Philippe LuscanSenior VPIndustrial Affairs
David-Alexandre GrosChief Strategy Officer
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1919
Agenda
Industry transformation
Strategy we are executing
The new Sanofi
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2008-2011
The New Sanofi We Have Been Building
Past Today
Geographic balance U.S. / Western Europe Global
Exposure to patent cliff High Declining
R&D Dependence Above average Below average
Organization Functionalsilos
Business oriented divisions
Culture Top down andinward looking
Collaborativeand open
Risk profile High Balanced
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2008-2011
An Unprecedented Shift in Business Mix and Focus
Top 15 61%
…to Key Growth Platforms & Genzyme
Sales Split in 2011e
GrowthPlatforms & Genzyme
~ 66%Vaccines10%
Basebusiness
29%
FromTop 15 Products…
Sales Split in 2008€27.6bn
Genzyme
Other25%
Key Genericized
9%
Key genericized products: Lovenox® U.S., Plavix® Western EU, Taxotere® Western EU & U.S., Eloxatin® U.S., Ambien CR® U.S., Allegra® U.S., Aprovel®Western EU, Xyzal® U.S., Xatral® U.S., Nasacort® U.S. - Generic makers of oxaliplatin (Teva, Fresenius Kabi (formerly Dabur), Sandoz, Mayne/Hospira, MN/Par, Actavis and Sun) required to cease selling in the U.S. since June 30, 2010 but litigation continues. 21
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2008-2011
Successfully Managing the Top Line Transition
% ofTotal 27% 25% 17% ~9% % of
Total 43% 47% 57% ~66%
… while Ramping upKey Growth Platforms & Genzyme
Getting the Patent Cliffbehind us…
(1) Lovenox® U.S., Plavix® Western EU, Taxotere® Western EU & U.S., Eloxatin® U.S., Ambien CR® U.S., Allegra® U.S., Aprovel® Western EU, Xyzal®U.S., Xatral® U.S., Nasacort® U.S. - Generic makers of oxaliplatin (Teva, Fresenius Kabi (formerly Dabur), Sandoz, Mayne/Hospira, MN/Par, Actavis and Sun) required to cease selling in the U.S. since June 30, 2010 but litigation continues.(2) 2010 include sales of Merial. In 2008 and 2009, Merial Joint Venture sales were not consolidated by Sanofi
Sales of key genericized products(1) Sales of growth platforms(2) & Genzyme
2008
€11.8bn
2011e
>€22bn
2010
€18.4bn
2009
€13.8bn
+ >€10bn
2011e
~€3.0bn
2010
€5.4bn
2009
€7.5bn
2008
€7.6bn
- €4.6bn
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2008-2011
Offsetting the Impact of the Patent Cliff on Sales
2011e2010
€30.4bn
2009
€29.3bn
2008
€27.6bn
Sales
CAGR~+6%
at CER(1)
(1) 2008 exchange rates23
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2008-2011
Mitigating the Impact of the Patent Cliff on EPS
Business EPS
2011e2010
€7.06
2009
€6.64
2008
€5.59
CAGRfrom
+3% to +4%at CER(2)
Positive impact from growth platforms, cost savings and acquisitions
(1) 2010 exchange rates(2) 2008 exchange rates
-2% to -5% at CER(1)
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IN SUMMARY
Entering into the Next Phase
● Sanofi has undergone an impressive transformation over 2008-2011
● Sanofi’s patent cliff will be over in 2012, leading to one of the lowest patent exposures, post cliff
● R&D rigor has allowed us to create an emerging pipeline of higher quality assets Development has been rationalized and is now state-of-the-art
● Focus shifts now to execution:● Growth of platforms ● New approach to research● Continued discipline on costs
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2008-2011 FINANCIAL DISCIPLINE
Jérôme Contamine
Executive Vice President, Chief Financial Officer
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Agenda
Progress on cost savings
Realigning the organisation
Disciplined M&A
Profitability in growth platforms
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2008-2011
€2bn Cost Savings - Progressing Faster than Anticipated
Plan Plan PlanActual Actual Revised
€2bn
● Original plan was €2bn(1) by 2013
● Will achieve target 2 years ahead of schedule
€1.3bn
€0.5bn
2009 2010 2011e
(1) At CER, before inflation and tax on a constant structure basis compared to 2008
Cost Savings(1)
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2008-2011
Tight Cost Control while Investing in Growth Platforms
SG&AExpenses
R&DExpenses
CoGSExpenses
Investing inGrowth Platforms
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2008-2011
CoGS Ratio Peaking at around 31% in 2011/2012
(1) Lovenox® U.S., Plavix® Western EU, Taxotere® Western EU & U.S., Eloxatin® U.S., Ambien CR® U.S., Allegra® U.S., Aprovel® Western EU, Xyzal® U.S., Xatral® U.S., Nasacort® U.S. - Generic makers of oxaliplatin (Teva, Fresenius Kabi (formerly Dabur), Sandoz, Mayne/Hospira, MN/Par, Actavis and Sun) required to cease selling in the U.S. since June 30, 2010 but litigation continues.
2011e
~33%
2010
33.3%
28.8%
2009
33.5%
26.8%
2008
33.8%
26.6%
CoGS Ratio
Reported CoGS ratio
CoGS ratio excluding
key genericized products(1)
~31%
● Degradation of reported CoGS ratio as anticipated from 2008 to 2011● Loss of exclusivity of former
blockbusters● Higher cost of raw heparin:
negative impact >1% in 2011e vs. 2008
● Productivity improvement resulting in decrease of CoGS ratio excluding key genericized products(1)
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2008-2011
Reduced R&D Infrastructure Costs and Headcount
54%
(1) Excluding Genzyme
~ -12%
2011e
~€830m
2008
€939m
Pharma R&D Infrastructure Costs(1) Pharma R&D Headcount(1)
~ -22%
2011e2008
~13,000
~10,000
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2008-2011
A Deep Dive on Structural Changes in R&D Pharma Spend
Pharma R&D Spend(1)
R&D costs evolution(projects,
infrastructure, support)
-15%between2008 and
2011e
R&D costs split between
internal & external
(excluding infrastructure)
50/50in 2011e
R&D costs split between Research &
Development(excluding
infrastructure)
33/66in 2011e
Research costs split between
internal & external
(excludinginfrastructure)
70/30in 2011e
Development costs split between
internal & external
(excluding infrastructure)
40/60in 2011e
Our focus remains on improving the ratio of fixed vs. variable costs
32(1) Excluding Genzyme, Phase IV studies, local studies and medical support
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2011e2010
€165m
2009
€334m
2008
€392m
2008-2011Refocusing Investment from Infrastructure to Licences/Acquisitions
54%
2011e2010
€300m
2009
€577m
2008
€72m
PharmaVaccines
(1) Including BiPar, Fovea, TargeGen, but excluding Genzyme
Pharma R&D CapitalExpenditures
R&D Investments(1) inLicences and Acquisitions
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2008-2011
Keeping SG&A Expenses under Tight Control
2011e
24.9%
2009 2010
25.0%
2008
26.0%
SG&A/Sales Ratio● 2008-2010: >1 ppt reduction in
SG&A ratio● Significant restructuring of sales
forces in the U.S. and Europe
● Resource reallocation towards growth platforms
● Acquisitions of businesses with higher relative sales and marketing expenses
● 2011: Slight increase in SG&A ratio due to integration of Genzyme
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2008-2011Successfully Navigating through the Patent Cliffdespite a Tougher Environment
● U.S. healthcare reform● ~$220m reduction in sales
in 2010
● ~$90m impact from excise fee in 2011
● ~$100m impact from “donut hole”
● EU price containment measures● Cumulated impact of
~€470m on sales in 2011 versus 2009
Pressure on Rx Pharma in Mature Markets
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Agenda
Progress on cost savings
Realigning the organisation
Disciplined M&A
Profitability in growth platforms
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2008-2011Adapting Industrial Site Network with Larger Footprint in Emerging Markets
Mature Markets Emerging Markets
6 6 7
37 35 31
2009 2011 OngoingPlan
Vaccines
Pharma
3 4 6
35 3636
2009 2011 OngoingPlan
Vaccines
Pharma
Number of Industrial Sites (including 2008-2011 acquisitions except Genzyme and Merial)
43 4138
38 40 42
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2008-2011
Reshaping of Commercial Operations in the U.S. and EU
● U.S. restructuring announced in 2010
● Sales force reduced by ~3,800 people over 2008/2011e
● EU organisation redesigned● Sales force reduction by ~2,700
people over 2008/2011e ● Implementation of 8 Multi-Country
Organisations
● Investment in mature brands significantly decreased
● Targeted resource allocation towards growth platforms&
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2008-2011
Alignment of Resources to Match High Growth Opportunities
U.S. Western Europe Emerging Markets
‐46%
2011e
~4,500
2010
5,822
2008
8,313 ‐34%
2011e
~5,300
2010
6,167
2008
7,971
20,246
2008
+22%
2011e
~20,800
2010
17,080
Sales Force Evolution since 2008(1)
(1) Excluding Merial and Genzyme39
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Agenda
Progress on cost savings
Realigning the organisation
Disciplined M&A
Profitability in growth platforms
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2008-2011
Discipline in M&A
Business opportunities with attractive sustainable
growth profile
Rationale for business synergies with existing
Growth Platforms
Rigorous financial evaluation criteria
● Return on capital has to exceed WACC after tax between Year 3 and Year 5 following the acquisition
Geographic complementarities
Portfolio complementarities
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2008-2011
Strong and Rapid Value Creation from Key Acquisitions
ROCE expected to exceed WACC after taxYear 1-2 Year 3-4
Strong value creation in Brazil and beyond
Successful launch of Allegra® OTC
Large expertise in Branded Generics in Eastern Europe
Strong position in Animal Health
Unique expertise in Rare Diseases
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Agenda
Progress on cost savings
Realigning the organisation
Disciplined M&A
Profitability in growth platforms
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2008-2011
Solid Profitability of our Different Activities
2011e Business Operating Margin
Pharmaceuticals excluding Plavix®/Avapro® in the U.S.
Diabetes(1)
Consumer Health Care(1)
Generics(1)
Genzyme(2)
Vaccines
Animal Health
Total Group excluding Plavix®/Avapro® in the U.S.
(1) Figures estimated assuming allocation of indirect costs proportional to sales (distribution, G&A, medical marketing) and R&D costs (R&D infrastructure) (2) Historical Genzyme perimeter
~29%
~35%
~25%
~18%
~27%
~29%
~31%
~29%
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2008-2011
Sustainable Profitability in Emerging Markets
● Sustain solid and stable operating margin excluding central, administrative and R&D costs:
● Around 40%(1)
● Unique ability to manufacture locally
● Lower selling costs
● Limited G&A expenses
● Regional pricing
(1) Estimate for Business Operating Margin excluding central administrative and R&D costs in 2011
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IN SUMMARY
An Impressive Transformation is Underway
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Cost savings ahead of target
Control over key financial ratios
A disciplined approach to M&A
Growth platforms all solidly profitable and growing
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EMERGING MARKETS
Hanspeter Spek
President, Global Operations
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Emerging Markets opportunity
Sanofi’s leadership
Agenda
Growth drivers in BRIC countries and beyond
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Macro Factors Point to Strong Growth in Emerging Markets
(1) IMF; CIA The World Factbook(2) IMF; internal analysis(3) IMF; WHO 2008(4) IMS Pharmerging Markets CAGR 2010-2015(5) WHO, World Population Prospects: The 2010 revision; CIA The World Factbook(6) Brookings Institution; Goldman Sachs
Emerging Markets
Population(1) 6bn
Estimated GDP growth 2010-2015(2) 5-9%
Healthcare expenditure as % of GDP(3) 5-6%
Estimated Pharmaceutical Market growth CAGR 2010-2015(4) 13-16%
Annual birth cohorts(5) 120m
Large middle class by 2030(6) ~2bn
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Growth Contribution from Emerging Markets to be >70%
50
2010
World Pharmaceutical Market(1)
2015e
Contributionto Growth
(1) IMS Market Prognosis, 2011-2015
Emerging MarketsMature Markets
Opportunities and Challenges
● Growing and aging populations
● Shift from acute to chronic diseases
● Need for greater access to medicines
● Cost burden on governments and healthcare reforms
● Largely out-of-pocket markets
● Increased investment from all market players
Sales Split
74%
26%
26%
74%
64%
36%
€656bn
€837bn
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Emerging Markets opportunity
Sanofi’s leadership
Agenda
Growth drivers in BRIC countries and beyond
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Emerging Markets Growth Historically at Double-digit Rates from a Large Base
● Leading position built on historical strengths
● Around €10bn of sales in Emerging Markets expected in 2011e
● ~30% of Group sales in Emerging Markets in 2011e vs. 24% in 2008
● Most active company in M&A in last 3 years in Emerging Markets resulting in accelerated sales growth(2)
52
Sanofi’s Performance in Emerging Markets(1)
(1) The world less the U.S. and Canada, Western Europe, Japan, Australia and New Zealand(2) Internal estimates
2008 2009 2010
~€10bn
2011e
+9%
+15%
200720062005
€5.0bn
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Sanofi is the #1 Healthcare Company in Emerging Markets
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A commercial presence in a large number of Emerging
Markets
Sanofi’s Scorecard in Emerging Markets(1)
Number onecompany in Emerging
Markets by market share
A top position in most of the fast growing economies
One of the biggest sales
forces in Emerging Markets
Largest proportion of
sales generated in Emerging
Marketsamong peers
A widenetwork of
industrial sites across
Emerging Markets
#1with
5.5% marketshare
#1in BRIC
and non-BRIC
>30%of global
sales
~21,000sales
representatives
42industrial
sites
~100countries with
commercialpresence
(1) IMS MIDAS MAT Q1 2011 (with constant Brazil retail panel scope) 53
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Growing Exposure to Emerging Markets with a Broad and Diversified Offering
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(1) Without Genzyme(2) Merial sales not consolidated in 2008(3) Pharmaceuticals excluding Diabetes, CHC and Generics
Emerging Market Sales and % Represented by Emerging Markets per Segment(1)
Diabetes
2011e2008
€528m
Vaccines
2011e2008
€814m
20%
Generics
2011e2008
€33m65%
Other Pharmaceuticals(3)
2011e2008
€4,614m
28%
34%
Animal Health(2)
2011e2008
€355m24%
Consumer Health Care
2011e2008
€551m 48%
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% of Global Product Sales in 2011e
~€730m
~€540m
~€310m
~€370m
~€200m
~€250m
~€220m
Sales 2011e inEmerging Markets
Significant Contribution from Legacy Brands in Emerging Markets despite Generic Competition
Top Brands inEmerging Markets
~€160m
55
26%
29%
33%
53%
59%
48%
35%
15%
+8.3%
+12.7%
-23.5%
+11.4%
+0.1%
+7.2%
+12.6%
Sales GrowthH1 2011 (at CER)
+12.9%
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Building a Tailored Portfolio in Emerging Markets through Multiple Acquisitions and Partnerships
Genericsand
ConsumerHealth Care
● A total of 17 deals since 2008
● Addressing income disparities
● Tapping into out-of-pocket markets
● Adding local brands
● Invested a total of around €3.7bnin acquisitions
Adjusting our Offerings to Local Needs in Fast Growing Market Segments
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Emerging Markets opportunity
Sanofi’s leadership
Agenda
Growth drivers in BRIC countries and beyond
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Consolidating Sanofi’s #1 Position in Brazil
● Tailored approach with leading presence in each market segment
● Launch generics of high-demandoff-patent Rx drugs
● Leverage broad CHC portfolio through extended distribution channels
● Strengthen Diabetes leadershipin private and public market
● Leverage strong presence at pharmacy
Opportunity Focus
● Expected to be 6th largest market by 2015(1)
● Largely out-of-pocket
● Rising middle class with increased purchasing power
● Growth driven by generics and volume
● Sanofi ranks #1 in Brazil(2)
● Sales of ~€1.2bn in 2011e
● #1 in Generics(3) and #2 in CHC(4)
● Sales force covering >25,000 points of sales (>80% of total demand)
● Strong local manufacturing capabilities (> 90% of products manufactured locally)
(1) IMS Market Prognosis, 2011-2015 market ranking in constant US$(2) IMS PMB MAT June 2011 (restated base), 1€ = 2.30(3) Estimated from IMS MIDAS MAT Q1 2011 (4) Nicholas Hall, DB6 2011 (2010 sales) 58
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Sanofi Covers Fastest Growing Market Segmentsin Russia
● Maximize the advantage of local insulin manufacturing capacity● Lead conversion to modern basal
insulin analogs● Low rates of diagnosis and
insulinization provide opportunity ● Regional market segmentation
● Drive leadership in CHC through higher investment in marketing mix
● Offer high quality generics at affordable prices
● Expected to be 10th largest market by 2015(1)
● Hybrid market with out-of-pocket and reimbursed funding
● Strong historic market growth
● OTC and Generics are large and fastgrowing segments(2)
● Increased government attention to healthcare market (e.g. Pharma 2020)
● Sanofi ranks #2 in Russia(3)
● Sales of ~€750m in 2011e
● #3 in OTC(4) market (Essentiale®, No-Spa®)
● Zentiva: one of the fastest growing players in Generics(5)
Opportunity Focus
(1) IMS Market Prognosis, 2011-2015 market ranking in constant US$(2) Estimated from IMS MAT Q1 2011 : Market shares of Generics and OTC are 33%. Generics and
OTC are growing 13%(3) IMS MIDAS MAT Q1 2011(4) Nicholas Hall, OTC YearBook 2011, DB6 2011 (2010 sales)(5) IMS MIDAS MAT Q1 2011. Zentiva growth: +27%
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A Fast Expanding Industrial Hub in India
● Expand ‘Prayas’ project to improve quality of healthcare in rural India
● Quality medicines at affordable prices
● Enter CHC with Universal deal
● Provide high quality & affordable production resources to support expansion strategy in Emerging Markets
● Expected to be 8th largest market by 2015(1)
● Highly fragmented with >10,000 players
● Growing population and shifting disease profile
● Need for better accessibility and delivery of healthcare in rural areas
● Private healthcare accounts for nearly80% of total healthcare spend
● Sanofi is present in India for >55 years
● 2nd fastest growing multinational company(2)
● 4 industrial sites (~7bn tablets annually)
Opportunity Focus
(1) IMS Market Prognosis, 2011-2015 market ranking in constant US$(2) IMS MIDAS MAT Q1 2011
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Reaching out to the Next Billion Customers in China
● Diversify geographic concentration
● Fully leverage broad portfolio
● Invest in the county hospital market ● Strategic Business Unit implemented ● Sales force expansion by
~1,000 representatives
● Expand CHC business
● Shape market through public-private partnerships ● Support of “China Alliance
for Diabetes Excellence“
● Expected to be 3rd largest market by 2015(1)
● Healthcare reform to improve infrastructure and to address affordability issues
● Growing demand of ~900m people in China’s 2,000 counties(2)
● Sanofi ranks #3 company in China(3)
● Sales of ~€1bn in 2011e for Greater China
● Fastest growing multinational company(3)
● Sales force of 4,500 reps
● 6 industrial sites
(1) IMS Market Prognosis, 2011-2015 market ranking in constant US$(2) Includes county-level cities and counties(3) IMS MAT June 2011
Opportunity Focus
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# #
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Beyond BRIC, Well Poised to Capture Growth in Other Fast Growing Economies
~€10bn Total Emerging Markets Sales
in 2011e
#1 in Africa and Middle East
#2 in CEE #2 in LatAm#4 in Asia
10countries with sales between
€100m and €500min 2010
Non-BRIC65%
BRIC35%
BRIC: Brazil, Russia, India, China(1) IMS MIDAS MAT Q1 2011
~3bn
LargePopulation
Sanofi Leadership Position
outside BRIC(1)
Countries with Scale
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Key Success Factors to Sustain our Unmatched Leadership Position in Emerging Markets
Historical presence
● Leverage unique accumulated experience and diversified product portfolio
Market reach ● Expand sales forces to address rural areas
Manufacturing capacity ● Grow network of industrial sites to serve increasing volume
Quality of management ● Attract, train and retain local management talent
Tapping into local innovation ● Broaden R&D networks in Asia
Bolt-on acquisitions
● Continue to enlarge our portfolio by successfully identifying and integrating M&A targets
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DIABETES
Pierre Chancel
Senior Vice President, Diabetes
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Market opportunities
Delivering full value of current portfolio
Sustaining long term growth through R&D
Agenda
65
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Diabetes Remains One of the Largest Opportunitiesin the Healthcare Space
Adults with diabetes worldwide(1) 350m
% of patients not achieving glycemic control target values in the U.S. and EU(2) >50%
Patients remaining undiagnosed in BRIC countries(3) ~2/3
Expected size of global diabetes market in 2015(4) $43-48bn
Expected CAGR growth of global diabetes market between 2011 and 2015(4) 4-7%
66
(1) G. Danaei, Lancet 2011; 378: 31-40(2) Adelphi Disease Specific Program (DSP) III and VII (sample of over 10,000 diabetic patient records) (3) Internal estimates based on multiple sources(4) The Global Use of Medicines: Outlook through 2015, IMS Institute for Healthcare Informatics, May 2011
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The Diabetes Epidemic is Expanding in Emerging Markets
People with diabetes 2010 26m 24m 56m 9m
Rate of diagnosis 75% 75% 36% 58%
Expected diabetes population growth 2010-2015 +14% +9% +34% +14%
Insulinized patients 2010 5.6m 5.1m 4.6m 1.3m
Expected insulinized patients 2015 6.9m 6.4m 8.9m 1.7m
Key Epidemiology Facts
Source: IMS data and internal patient model67
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Market opportunities
Delivering full value of current portfolio
Sustaining long term growth through R&D
Agenda
68
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Lantus® #1 Insulin Brand Worldwide – A Growth Story
120m Lantus® SoloStar® pens sold in 2010
€3.5bn
€3.1bn
€2.5bn
€2.0bn
€1.7bn
€1.2bn
2005 2006 2007 2008 2009 2010 2011e
Lantus® Global Sales
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• From Lantus® brand to Lantus® -based solutions
• New ambition with Apidra® and Insuman®
• Lyxumia® to expand use of GLP-1s
Key Pillars to Fuel our Ambition
• Tackling unaddressed cardiovascular morbidities
with anti-PCSK9 mAb
• Expansion in Emerging Markets(1)
(1) The world less the U.S. and Canada, Western Europe, Japan, Australia and New Zealand70
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EU Insulin MarketU.S. Insulin Market
Ability to Grow Insulin Market Share in U.S. and EU
Value Share
Volume Share
Value Share
Volume Share
June 11June 08
37% 37%
SanofiNovo NordiskEli Lilly
June 11June 08
28%33%
June 11June 08
30%34%
June 11June 08
24%28%
IMS data – Monthly basis – June 2008 to June 201171
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Sanofi - Fast Growing Insulin Player in BRIC-M
- 10%
0%
10%
20%
30%
40%
50%
0% 10% 20% 30% 40% 50%
Growth yoy %
Market Share %
Lilly
Novo
Sanofi
Insulin Sales (constant €)
(1) IMS Monthly data base – MAT June ’11 vs MAT June ’10 (Data for Russia only reflect IMS retail channel) (2) IMS sales MAT June ’11
● Historical focus on value market
● Opportunity for volume expansion
● Strong leadership position in diabetes in Brazil and Mexico(2)
● Renewed efforts to expand basal treatment paradigm in China
● New manufacturing site for Lantus® SoloSTAR® in China
● Acquisition of Bioton Wostok insulin plant in Russia in 2010
BRIC-M Insulin Market(1)
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2012-2015: Set to Remain #1 Diabetes Brand
From Lantus® Brand to Lantus®-Based Solutions
● Now 40% of U.S. Lantus® new prescriptions with SoloSTAR®
● Majority of U.S. patients expected to use SoloSTAR® by 2015
&
● Encouraging launches in France & Germany
● Roll-out in key markets expected to be completed by end 2012
● Development ongoing to integrate advice for Lantus® dosing
Emerging Markets
● Further market access initiatives ongoing
● Disease management● Treatment paradigm● Tiered pricing● Type-1 diabetes
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Testing Early Insulinization with Lantus® for Better Long Term Outcomes
Potential benefits of early insulinization
on disease control Additional dataon Lantus®
safety profile
Trial Results Expected Mid-2012
Lantus® label improvement
if trial endpoints metEndpoints• CV morbidity/mortality
• All-cause mortality
• Risk of diabetic microvascular outcomes
• Rate of progression of IFG or IGT to Type 2 diabetes
At high CV risk • and IFG, IGT• or newly detected diabetes• or established diabetes
>12,500 Patients
Main Endpoints
CV – Cardiovascular IFG – Impaired fasting glucose IGT – Impaired glucose tolerance
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Continuous Commitment to Safety
Retrospective cohort studies
Scientific presentation in 2012
Communication to regulatory agenciesin Q4 2011 (Nordic) and Q1 2012 (U.S.)
Epidemiology Program Ongoing
Nordic databases U.S. databases International Study on Insulin and Cancer(France, UK and Canada)
Case-control study
Scientific presentation in 2013
Communication to regulatory agencies by Q1 2013
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● Indirect comparison of nocturnal event rates in the Lantus® arm from the Novo-3579 study vs. Sanofi studies shows a different pattern of cumulative curves
● In representative* Sanofi glargine trials nocturnal hypo rates are consistent despite different glycemic control achieved at end of trials(2,3)
● Factors other than end of trial HbA1c or FPG may contribute to an increase occurrence of nocturnal hypoglycemia for the Lantus® arm in Novo-3579 trial such as● Unusually aggressive titration target
(70-90 mgl/dL FPG) in Degludec trials● Lack of enforcement of same time of
injection for the study drug and the gold standard comparator (e.g. dinner time vs any time of the day(1))
1) As presented at Novo Nordisk Capital Markets Day on May 5th, 2011 2) Massi Benedetti et al, Horm Metab Res 2003; 23:189-1963) Standl et al, Diabetes Care 2005; 28 (2): 419-420 4) Calculated from each study using confirmed hypoglycemia of PG <3.1 mmol/L; data on file.
Glargine
Degludec
Nocturnal confirmed hypoglycemia over time (weeks)
Nocturnal confirmed hypoglycemia over time (weeks)
Glargine (4009)(4)
Glargine (3002)(4)
Glargine 3002 study(2),T2–BOT (n=570) End of trial HbA1c: 8.5%
Glargine 4009 study(3),T2-BOT (n=624)End of trial HbA1c: 7.2%
* 3002 study representing a non treat-to-target trial design* 4009 study representing a treat-to-target trial design
Is the Gold Standard Basal Insulin
Degludec NN-3579 study(1)
T2–BOT (n=1030)End trial HbA1c: ~7.0%
Noc
turn
al h
ypog
lyca
emia
(eve
nts/
subj
ect)
Noc
turn
al h
ypog
lyca
emia
(eve
nts/
subj
ect)
Indirect comparison of event rates using same hypo definition as respectively shown in Degludec NN-3579
and two Sanofi glargine studies (3002, 4009)
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Delivering the Full Value of Other Portfolio Assets
● New ambition with Apidra®
● New U.S. sales and marketing platform• Dedicated sales force since July 2011
● Expansion in Asia• Accelerate penetration in Japan• Partnered with IDF and Chinese Diabetes Society
to help building the first Type 1 diabetes registry• Launch expected in 2012 in China
Established Insulins
Optimized Devices
Innovative Blood Glucose Monitoring
● Untapped opportunities for Insuman®
● Regulatory submission anticipated in 2011 in South-East Asia
● Short-acting and pre-mixed forms currently in Phase III in China
● SoloStar® submission in Russia expected by end 2011
IDF: International Diabetes Federation77
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Market opportunities
Delivering full value of current portfolio
Sustaining long term growth through R&D
Agenda
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Six R&D Projects with a Goal of Submission in 2011-2015
Lyxumia® (lixisenatide)GLP-1 agonist
Type 2 diabetes
Lantus®
Insulin glargineReduction in CV morbidity & mortality
Insuman® (Asia)Human insulin vials and cartridges
Type 2 diabetes
SAR236553 Anti-PCSK-9 mAb
Hypercholesterolemia
Phase III
Products in Development / Major LCM Activities Status Update
Planned submissions for EU in Q4 2011, Japan mid-2012, U.S. in Q4 2012
Phase II Entered Phase II in Q1 2011 – Fully enrolled
(1) Also includes other Phase I projects which are not for submission before 2015 and therefore not mentioned here, i.e. SAR407899 and SAR101099Partners: Lixisenatide (AVE0010): Zealand Pharma, SAR236553 (REGN727): Regeneron
Phase I(1)
Phase I trials completed in Q3 2011
Initiation of Phase III expected early 2013
ORIGIN study results expected mid 2012
Phase III ongoing in ChinaSubmissions ongoing in SE-Asia
Lantus® + lixisenatide Insulin glargine + GLP-1 agonist
Single pen device / Type 2 diabetes
New formulationInsulin glargine
Type 1 + 2 diabetes
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Broad Phase III Program Including as Add-on to Basal Insulin
GetGoal‐MonoGetGoal‐Mono Japan
Drug naïve patients
Placebo controlled in OAD failure GetGoal‐M (metformin)
GetGoal‐F1 (metformin)
GetGoal‐M Asia (metformin)
GetGoal‐S (sulfonylurea)
GetGoal‐P (pioglitazone)
GetGoal‐X vs. exenatideActive‐controlled
GetGoal‐L (basal insulin)GetGoal‐L Asia (basal insulin)Placebo controlled on
top of basal insulin
CV Study ELIXA
Reported
Phase III Program
Lyxumia® is the intended trademark for lixisenatide. Lixisenatide is currently not approved or licensed anywhere in the world.
®
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● Main efficacy A1c(1) endpoint met in all studies
● Pronounced effect on post-prandial glucose(2)
● Decrease in body weight as monotherapy or in combination with OAD or basal insulin(2)
● Promising safety profile vs. exenatide twice daily(3)
● 3-fold fewer symptomatic hypoglycemic events ● Better gastrointestinal tolerability
● Simplicity for enhanced compliance● 1 injection per day● 1 step to maintenance dose(4)
● 1 single pen device per dose
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: First Data Leading To Unique Profile®
®
Lyxumia® is the intended trademark for lixisenatide. Lixisenatide is currently not approved or licensed anywhere in the world.(1) A1c used for HbA1c – Glycated hemoglobin (2) GetGoal program (3) GetGoal-X (4) GetGoal-F1
~90% of patients stayed on maintenance dose
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Ideal Partner to Basal Insulin
● High willingness of physicians to use GLP-1s as add-on to basal insulin(1)
● More than 7m patients receiving Lantus® worldwide(2)
● GetGoal-L & -L Asia to support indication as add-on to basal insulin
● [Lyxumia® + Lantus®] combination moving forward● “Free combination” Phase III trial(3)
expected to complete by end 2011 ● Injection device in development to allow
Lantus® variable dose and Lyxumia®
fixed dose
GetGoal-L AsiaSubgroup analysis of Lantus® users(4)
A1c change from baseline (%)
Placebo 93
8.45
Lyxumia®
948.43
Patient, NBaseline A1c
Lyxumia® is the intended trademark for lixisenatide. Lixisenatide is currently not approved or licensed anywhere in the world.(1) >30% of GLP-1 users receive insulin in the UK. Source: ABCD (Association of British Clinical Diabetologists) Audits, B. Ryder at the Diabetes UK Annual Professional Conference (April 2011), and http://professional.diabetes.org/News_Display.aspx?TYP=9&ori=rss&CID=85182(2) IMS Full year data 2010, Adelphi DSP VII, internal estimates(3) Trial EFC10781 / “Free combination” means Lyxumia® (vs. Placebo) after Lantus® titration in patients insufficiently controlled with MET +/- TZD(4) >60% of patients previously on Lantus® in GetGoal-L Asia
LS Mean Difference vs. Placebo p<0.0001M
ean
Cha
nge
(%)
®
-0.89
+0.02
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Anti-PCSK9 mAb - A Significant Opportunity to Tackle Unaddressed Cardiovascular Morbidities
● New ESC/EAS guidelines recommend more stringent LDL-C target for very high risk patients including diabetic patients with target organ damage(2)
● Only 41% of very high risk patients reach the newly defined goals with current lipid lowering therapies(3)
● Phase II results expected in H1 2012
(1) Swergold G. J Am Coll Cardiol 2011;57:E2023 (2) ESC/EAS guidelines on dyslipidemia European Heart Journal (2011) 32, 1769–1818(3) Virani American Heart Journal 2011; 161:1140-6
LDL-C Mean % Change from Baseline(1)
Subcutaneaous Injection of SAR236553 or Placebo
- 70- 60- 50- 40- 30- 20- 10
0 10 20
0 10 20 30 40 50 60 70 80 90 100 110
LS Means Calculated LDL-C Percent Change (%)
Placebo B CA D
Study Days
- 60%
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From Lantus® brand to Lantus®-based solutions
New ambition with Apidra® and Insuman®
Expansion in Emerging Markets
Lyxumia® to expand use of GLP-1s
Diabetes: Focusing on Sustainable Growth
Tackling unaddressed cardiovascular morbiditieswith anti-PCSK9 mAb
(1) CAGR84
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VACCINES
Olivier Charmeil
Senior Vice President, Vaccines
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The vaccines market
Sanofi Pasteur leadership
Agenda
Growth drivers
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Vaccines Market – All the Key Attributes for a Growth Platform
Vaccines Market
Major unmet needs remain
● Large birth cohorts in Emerging Markets
● Many diseases with low immunization rates or no vaccines
● Expansion opportunity in adult segment
Barriers to market entry are high
● Complex biological processes
● Rigorous manufacturing and regulatory standards
● Expertise required in many technologies
● Reliability and commitment to public health key to market access
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Top 5 Companies Have Combined ~80% Market Share
Others19% Sanofi
Pasteur21%
Merck18%
GSK20%
Pfizer16%
Novartis5%
Sanofi Pasteur: a leading global player (1) Market share based on Sanofi Pasteur internal estimates (2) Excluding pandemic influenzaSanofi Pasteur MSD sales allocated 50/50 to Merck and Sanofi (minus supply sales from JV partners to SP MSD)
Global Market Sales(2):
~€17bn
2010 Market Share(1) excluding A/H1N1
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Global Vaccines Market Growth to Remain Healthy
Projected Worldwide Vaccines Market Sales
(1) 2012-2015 CAGR based on Sanofi Pasteur internal estimates
CAGR(1)
+6 to 7%
2015e2014e2013e2012e
€23bn
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Agenda
The vaccines market
Sanofi Pasteur leadership
Growth drivers
90
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Flu27%
Polio/ Pertussis/
Hib31%
Boosters12%
Meningitis/ Pneumo13%
Travel & Endemics
11%
Other6%
Sanofi Pasteur Great Fundamentals to Capture Future Growth
● Leading commercial presence● €3.8bn consolidated sales in
2010(1)
● >1bn doses produced per year
● Present in 150 countries
● Leadership position in pediatrics, flu, meningitis, travel & endemic
● Promising R&D pipeline● 13 projects in clinical
development, including Dengue
● Strong record of alliances
Broad Product Offering
Sales Split 2011e
(1) Including €452m of pandemic influenza revenues (A/H1N1)91
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World Class Industrial Operations
Sanofi Pasteur Industrial Sites
Shenzhen
Chachoengsao(1)
Ocoyoacac
Toronto
Pilar
Hyderabad
Swiftwater (PA)Canton (MA)Rockville (MD)
Marcy-l’EtoileVal de ReuilNeuville
€1bn investment in production capacity in last 5 years to meet global demand
(1) Joint Venture: GPO-MBP92
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Agenda
The vaccines market
Sanofi Pasteur leadership
Growth drivers
93
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Defend and Reinforce Position in Mature Markets(1)
Two Strategic Imperatives for 2012-2015
● Large population and birth cohorts
● Low immunization rates
● Economic growth driving demand and public funding
Aggressively Pursue Growth Opportunities in Emerging Markets(2)
● Value creating opportunities through product differentiation
● Still room for expansion of coverage
● Concentrated competition
2015e2014e2013e2012e 2015e2014e2013e2012e
(1) U.S, Canada, Western Europe, Australia, New Zealand, and Japan(2) World less North America, Western Europe, Japan and Australia/New Zealand(3) Estimated CAGR 2012-2015 for the vaccines market based on Sanofi Pasteur internal estimates
€14bn
€9bn
MarketCAGR +4%(3)
MarketCAGR +11%(3)
1 2
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Key Growth Drivers
Mature Markets– Flu vaccines U.S.– Enhanced performance of JV with Merck in EU– Expansion in Japan
Emerging Markets– Pediatric combos– BRICM – Dengue
Strong Pipeline
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MATURE MARKETS
Flu Vaccines Will Drive U.S. Sales Growth in 2012-2015
Fluzone® High-Dose
Fluzone®
Fluzone® ID
Fluzone® QIV ID
Fluzone® QIV IM
Time
Value
Segmentation expected to be completed by 2015
QIV: Quadrivalent IM: Intramuscular ID: Intradermal
Sustained leadership and value creation through differentiation
Marketed70m doses; 43% MS in 2010
Fluzone® Quadrivalent: • 4 strains for broader
protection • Intramuscular (QIV IM)• Intradermal (QIV ID)
U.S. recommendations for universal coverage expected to contribute
illustrative
U.S. flu sales expected to grow at double-digit CAGR 2012-2015
1
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MATURE MARKETS
Opportunities in Europe and Japan
● Strong presence with Sanofi Pasteur MSD joint-venture(1)
● €918m sales in 2010, 30% MS
● Strong leadership position in HPV, booster and flu vaccines
● New JV Head appointed
● Restructuring implemented to adapt to end of HPV vaccination catch-up period
● Opportunities with LCM initiatives in existing segments (HPV, boosters) and new launches
Europe Japan
● Market opening more widely to non local players
● Unprecedented government funding €2bn over 2010-2015 to support immunization, including Hib
● ActHIB®, first and only Hib vaccine introduced in Japan (Dec 2008)
● Opportunity to launch new vaccines (IPV stand alone, pediatric combos, Adacel®)
1
(1) 50/50 JV with Merck & Co in Europe: sales not consolidated by Sanofi Pasteur – JV accounted for using the equity methodHPV: Human papilloma virus IPV: Inactivated polio vaccine Hib: Haemophilus influenzae type b 97
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EMERGING MARKETS
Sanofi Pasteur Has a Well Established Presencein Emerging Markets
(1) Global Sanofi Pasteur 2010 sales: €3,808m, including €452m A/H1N1 vaccine(2) Market Share: Sanofi Pasteur internal estimates (3) 2010 sales excluding pandemic influenza. Including pandemic influenza, sales in Emerging Markets were €1,386m.
• Present in over 100 countries• Investing in local manufacturing• Regional approaches for R&D
EmergingMarkets
Sales(3): €1,025m
Latin America
€157m
€196m
Eastern Europe
& Turkey
€312m
Asia
€309m
Africa & Middle East
Sanofi Pasteur 2010 Sales(1) and Market Share (MS)(2) in Emerging Markets
MS20%
2
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EMERGING MARKETS
A Pediatric Combo PortfolioTailored to Unmet Needs in Emerging Markets
(1) Pediatric combination includes Diphtheria, Tetanus, Pertussis, inactivated Polio, plus Haemophilus b and/or Hepatitis B depending on vaccine(2) Corresponding to birth cohorts of about 124m in Emerging Markets. Primary series in 3 doses for each antigen.wcP: whole cell Pertussis acP: acellular Pertussis OPV: oral polio vaccine IPV: inactivated polio vaccine Hib: Haemophilus influenzae type b
100%(2)
0%
Immunization Rate %● Full range of combo vaccines to address
different market needs
● Inactivated Polio Virus / Acellular Pertussis combo vaccines:TetraximTM
Pentaxim®
Hexaxim® submitted to EMA for Scientific Opinion under Article 58
● Whole cell Pertussis combo vaccine:Shan5® (by Shantha)
● Investment in capacity for key combo(1)
antigens to meet global demand
● Up to 300md IPV, 200md acP and 180md Hib, etc.
2
Pertussis Hib
wcP
acP
IPV
OPV
Polio
99
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EMERGING MARKETS
2012-2015: Unique Footprint in Emerging Markets to Contribute to Expansion
● Expansion of flu immunization, in partnership with Butantan Institute
● IPV introduction in public market
● Expansion of new vaccines (Menactra®, Adacel®)
● Key country for Dengue vaccine
● Pentaxim®: first 5-in-1 launched in 2011
● Flu facility about to come on line
● Rabies vaccines VRVg expected launch in 2014
Brazil
IndiaChina
● Leading OPV supplier for polio eradication
● Shantha: Strategic asset for further expansion in India and Emerging Markets
● Shan5: Expected to bid for supply for 2nd part of 2013-2015 UNICEF tender
Mexico
● Unique flu industrial base (Ocoyoacac) and partnership (Birmex)
● AcXim range included in national immunization program
● High potential for future products: Hexaxim®, Dengue
2
100
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EMERGING MARKETS
Dengue – Increasing Geographic Spread and Burden
Global Dengue Activity (CDC)
● 2.5-3.5bn people in tropical and subtropical regions● Annual incidence of 230m cases, 2m severe, 25,000 deaths● High economic burden● Market estimated to be over €1bn
2
Dengue Risk Transmission Areas and Dengue Reports (From U.S. CDC-HealthMap, Year 2010): www.healthmap.org/dengueCDC: Centers for Disease Control
Country levelProvince or local levelArea of ongoing transmission
101
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EMERGING MARKETS
Developing a Safe and EffectiveTetravalent Vaccine against Dengue
Worldwide clinical development (n=43,000(1))
First submissions planned in 2013
Construction of manufacturing facility
● Satisfactory consistent safety profile and balanced immune response observed in early trials
● 1st efficacy Phase IIb results expected end 2012 (n=4,000)
● Expanded efficacy Phase III studies ongoing
● Working with various stakeholders to support creation of appropriate immunization policies and funding
● Priority access to highly endemic countries in SE-Asia and Latin America (2014 onwards)
● 100m doses facility planned to be on line by 2014 (Neuville, France)
● Large investment: €350m
2
(1) Phase IIb and Phase III final enrollment102
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PIPELINE
A Solid R&D Pipeline to Fuel our Growth beyond 2015
● Dengue vaccine (Ph III) global roll-out to continue beyond 2015
● Three projects targeting hospital-acquired infections (Ph I & II)● Clostridium difficile (Ph II), Pseudomonas aeruginosa and Streptococcus pneumonia (Ph I)
● Several pediatric vaccines tailored for specific markets● Hexaxim® (Registration), DTP-HepB-Polio-Hib (Ph III)
● New generation of existing vaccines● Flu (Ph III), Rabies (Ph II), Meninge (Ph II)
● Shantha R&D capabilities facilitate opportunities to meet health needs of the developing world ● Rotavirus (Ph I), HPV and Shan6 (Pre-clinical)
1
2
3
4
5
3
Higher probability of success in vaccines vs. pharmaceuticals
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Vaccines: Well Positioned with a Long Growth Runway
● Leverage industrial platform to meet demand and optimize market access
● Solid R&D pipeline, including first Dengue vaccine, addressing unmet needs worldwide
● Leading global market position with 2011e sales growth of 7-8%(1)
● Solid operating margin of around 29% in 2011e
● Delivering single digit growth rate in 2012-2013 and double digit in 2014-2015
● > 50% of growth in mature markets expected to be driven by flu vaccines
● Emerging Markets expected to represent 40-45% of sales in 2015
(1) At constant exchange rates, excluding 2010 pandemic influenza revenues (A/H1N1) 104
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GENZYME
David Meeker, MD
Chief Operating Officer, Genzyme
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106
Orphan diseases and Genzyme
Personalized genetic health opportunity
Agenda
Multiple sclerosis opportunity
The new Genzyme
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Orphan Drug Market
Orphan Drug Market is Attractive and Offers Growth Potential Due to Significant Unmet Needs
● Significant unmet needs create strong growth potential● Under-served patient population
● Drugs available for only ~200 out of >6,000 orphan diseases(1)
● 85% orphan diseases are life threatening and 50% are pediatric(2)
● Several attractive market characteristics ● Unique development challenges
● Regulatory exclusivity period
● >$10bn sales for orphan-only drugs growing at high single digit since 2000 ● Expected to reach $18bn in 2015(3)
107(1) BioWorld Today, 2011(2) Food and Drug Administration, "Office of Orphan Products Development," Budget 2010(3) EvaluatePharma; internal analysis
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A Pioneering Approach to Orphan Diseases
Challenges Genzyme Expertise
Limited disease awareness Physician education
Small number of experts Identification/training/engagement
Limited patient advocacy Enabling patient communities
Limited outcomes data Patient registries establish natural history and long-term follow up
Lasting commitment 20 years of innovation, next generation therapies
108
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● Global leader in rare genetic diseases● Transformative therapies treating
patients in >100 countries
● 77% of sales outside the U.S. in 2010
● Established, long-term partnerships● Rare genetic disease KOLs
● Patient groups
● Governments/health authorities
● Technical expertise across broad range of technology platforms● Protein-based, cell and gene therapies
● Therapeutic polymers and biomaterials
● Small molecules
109
A 30 Year History of Expansion
(1) Includes only Personalized Genetic Health historical sales of Genzyme
2002 2003 2004 2005 2006 2007 2008 2009 2010
ROW
U.S.
Genzyme PGH Historical Sales(1)
$645m
$2,227m
$1,571m
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110
Orphan diseases and Genzyme
Personalized genetic health opportunity
Agenda
Multiple sclerosis opportunity
The new Genzyme
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111
Unleashing the Full Potential of Genzyme within Sanofi
DevelopMS
franchise
Escalateexisting
R&D programs
Broaden biologics
experience
Leverage global
scope and manufacturing
expertise
CreateR&D hubin Boston
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(2)
112
The New Genzyme – A More Focused Scope
Gaucher disease
Fabry disease
Pompe disease
Gaucherdisease
PGH Personalized
GeneticHealth
MSMultiple
Sclerosis
MPS I(1)
MPS II(1)
Thyroid cancer
Familial Hyper-
cholestero-lemia
eliglustat KynamroTM
Marketed Products
Products in Development
Products in Development
(1) MPS: Mucopolysaccharidosis(2) LemtradaTM and AubagioTM are the registered names submitted to health authorities for investigational agents, respectively
alemtuzumab and teriflunomide.
(2)
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Oncology
Key Brands from Genzyme
Integration of Other Genzyme Divisions into Sanofi
Biosurgery / Renal
Key Brands from Genzyme
113
Leverage Sanofi global footprint
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114
Orphan diseases and Genzyme
Personalized genetic health opportunity
Agenda
Multiple sclerosis opportunity
The new Genzyme
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1983
2001
115
Cerezyme® is the Foundation of the Genzyme Model
Transformative Therapy
2010 Sales Split
Ensure Market AccessExtensive Global Reach
● Increase awareness
● Enable access to diagnostic testing
● Identify and train experts
● Support patient advocacy
● Partner with healthcare systems
27%
EU
41%
U.S.ROW
32%
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116
Untapped Cerezyme® Opportunity in Gaucher Disease
(1) Symptomatic prevalence and diagnosed patient estimates from 2010 PGH Market Models / Epidemiology Database.(2) Sims K, Pastores G, Weinreb N, Barranger J, Rosenbloom B, Packman S, et al. Improvement of bone disease by imiglucerase (Cerezyme®) therapy
in patients with skeletal manifestations of type 1 Gaucher disease: results of a 48-month longitudinal cohort study. Clin Genet 2008; 73:430-40.
● Focus is on supplying patients● Differentiated profile:
● 20 years of proven safety and efficacy
● Demonstrated bone benefits(2)
● Significant additional opportunity exists with undiagnosed patients
Total treatedDiagnosed
~7,000 ~6,400
CZ treated
~4,800
Large population of undiagnosed
patients(1) 9% of diagnosed
patients not treated
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117
Myozyme®/Lumizyme®: Only Approved Treatment for Pompe
117(1) Symptomatic Prevalence based on 2011 Pompe Epi Model in 92 countries (excluding China and India). (2) Identified and treated patient numbers from regional patient trackers and LSD WW Report as of December 2010
MZ/LZ treated
~1,500
Total treated
~1,500
Diagnosed
~2,000
Large population of undiagnosed
patients(1)
19% of diagnosed
patients not treated(2)
● Long-term potential commercial opportunity similar to Cerezyme®
● Documented clinical benefit across disease spectrum
● Focus is on:
● Driving disease awareness
● Partnering with physicians to increase early diagnosis
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Myozyme®: Our Most Successful Launch
(1) Reflects the first full fiscal year after launch 118
0
50
100
150
200
250
300
350
400
450
0 1 year 2 year 3 year 4 year
Fabrazyme®
Aldurazyme®
(1)
$m
Myozyme®/Lumizyme®
Ceredase®/Cerezyme®
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119
Fabrazyme® Potential Unleashed when Supply is Restored
(1) Symptomatic prevalence and diagnosed patient estimates from 2010 PGH Market Models / Epidemiology Database.
Total treated
~4,200
FZ treated
~6,000
Diagnosed
Large population of undiagnosed
patients(1)
30% of diagnosed
patients not treated
~1,600
● Efficacy demonstrated at 1mg/kg● Regain significant market share by:
● Restoring supply● Driving importance of dose in
clinical outcomes● Growing patient awareness
● First Framingham product release anticipated in Q1 2012
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Fabrazyme® – Treating the Family
Finding 1 new index patient leads, on average, to diagnosis of another 5 patients in that family
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Expanding Manufacturing Capacity is Key to Future Growth
Sites Today 2012e 2015e Capacity
12,000L
20,000L
Framingham, MAnew plant
8,000L
Allston, MA
Geel, Belgium
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Creation of the Genzyme
R&D Center
Leveraging Genzyme’s Innovative Capabilities
● Strong expertise in PGH and MS
● Unique biologics platform
● Commitment to open innovation
● Integrated innovation hub in the Boston area
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Eliglustat – A Potential Game Changer in Gaucher Disease
StatusThe Product
● Potent, novel substrate inhibitor
● Oral therapy convenience with a capsule● Eliminating challenges of
infusing patients
● Clinical profile expected to be similar to Cerezyme®
● Global Phase III program underway
● Phase III data anticipated in H1 2013
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Eliglustat Clinical Data Comparable to Cerezyme®
%Change
8.0
0.0
-2.0
-4.0
-6.0
-8.0
6.0
4.0
2.0
Changein g/dL
-90
-60
-30
0
30
60
90
Baseline 1 year 2 years18 months6 months
Platelets
Hemoglobin
Spleen
22%
-22%
81%
63%40%
-36% -47% -52%
0.9g/dL 1.6g/dL 1.8g/dL 2.1g/dL
Cerezyme® Range
Eliglustat Phase 2 Trial Results: Treatment Changes to 2 Years
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Eliglustat: Potential Transformative Therapy(1)
December 2006pre-treatment (18 years)
December 20093 years post treatment (21 years)(2)
(1) Investigational drug(2) Patient from Phase II clinical trial
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126
126
Familial Hypercholesterolemia: Maximizing Kynamro™Potential through Genzyme’s Orphan Disease Expertise
HeFH(4): 1 million patients
HoFH(2) Severe FH(3)
Understanding Rarity
~40,000 patients(1)
(1) Patients for HoFH and Severe FH in US and EU markets (2) Homozygous Familial Hypercholesterolemia(3) Severe Familial Hypercholesterolemia = treated LDL-C >200mg/dL with CAD, or >300mg/dL without CAD(4) Heterozygous Familial Hypercholesterolemia
On statins: 60 million patients
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(1) Data on file
Long-term Effects of Kynamro™ in Extension StudyInterim Data Analysis
Study Week
26n=130
52n=110
76n=58
104n=26
Mea
n %
Cha
nge
(95%
CI)
Change from Baseline in Lipids(1)
● Safety profile consistent with all four Phase III studies
● Liver fat stabilized or decreased in some patients with treatment beyond 12 months
● Sustained reduction in apo B production decreased LDL and Lp(a)
● Filed in EU for HoFH and severe HeFH in July 2011
Filing expected in the U.S. for HoFH in Q4 2011
-40
-35
-30
-25
-20
-15
-10
-5
0
LDL-C ApoB Lp(a)
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Strong PGH Growth Potential
2012e 2015e
2012e-2015edouble digit
CAGR
Projected Genzyme PGH Sales
● Drive Pompe disease awareness
● Regain Cerezyme® and Fabrazyme® market share
● Restore manufacturing supply
● File eliglustat, a 2nd generation Gaucher product
● File Kynamro™ to treat familial hypercholesterolemia
Key Growth Drivers
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Orphan diseases and Genzyme
Personalized genetic health opportunity
Agenda
Multiple sclerosis opportunity
The new Genzyme
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Global MS Market Expected to Continue to Grow
MS Market Sales(1)Key Facts about MS
● ~2.1m patients worldwide
● Prevalent in young women (~2:1 female/male ratio)
● Life expectancy 5-10 years lower than unaffected people
● A major impact on family, social and professional life
● Symptoms include fatigue, weakness, walking and balance difficulties, vision problems
Multiple SclerosisCAGR
~6%
(1) Evaluate Pharma
2010 2015e
U.S.
ROW
$11.2bn
~$15.3bn
53%
57%
47% 43%
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: A Promising Investigational Agent for MS
CARE-MS I CARE-MS II
Patients 581 840
Study Duration 2 years 2 years
PatientPopulation
Treatmentnaïve
Treatment experienced
TreatmentArms
Alemtuzumabvs. IFNβ 1a
Alemtuzumabvs. IFNβ 1a
Co-primary
Outcomes
Relapse RateDisability
Progression
Relapse RateDisability
Progression
Data Timing Jul 2011 Q4 2011
● Strong efficacy(1)
● 55% reduction in relapse rate over 2 years compared to Rebif®
● Non statistically significant result on time to 6-month SAD(2)
(HR=0.70, p=0.22)
● Unique convenience● Annual dosing
● Manageable safety● Safety profile consistent with
Phase II clinical trial experience
(1) Results as reported from CARE MS I trial(2) SAD - Sustained Accumulation of Disability
Filing expected in the U.S. & EU in Q1 2012
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Aubagio®: An Exciting New Oral Treatment for MS
Filed in the U.S. in Q3 2011 and EU filing expected in Q1 2012
● Solid safety profile● No deaths, malignancies or
serious infections
● Drop out rate in Phase III similar to placebo
● Convenient● Once daily oral dosing
● Efficacy● 32% relapse rate reduction
● 30% reduction in disability progression
(1) Adjusted for Expanded Disability Status Scale score strata at baseline and takes duration of treatment into account. ARR - Annualized Relapse Rate, RRR - Relative risk reduction, HRR - Hazard ratio reduction
0 0,1 0,2 0,3 0,4 0,5 0,6
T. 14 mg
T. 7 mg
Placebo
TEMSO: Reduction in Adjusted(1) AAR
RRR: 31.2%p=0.0002
RRR: 31.5%p=0.0005
0 12 24 36 48 60 72 84 96 1080%
20%
10%
HRR: 23.7%p=0.0835
HRR: 29.8%p=0.0279
30%PlaceboT. 7 mgT. 14 mg
Week
TEMSO: Reduction in Disability Progression (%)
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Unmet need 3
Efficacy with manageable safety
Unmet need 2
Convenience & efficacy
Early MS/CIS(1) RRMS(2) and early active MS
RMS(3) severe/ highly active
Addressing the Full Spectrum of MSDrivers: Safety, Efficacy, and Support Services
Lemtrada™
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Quality of patient/physician support services
Aubagio®
Unmet need 1
Convenience& safety
Rebif®
Lemtrada™
Aubagio™
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(1) CIS: Clinically Isolated Syndrome, study presently ongoing (2) RRMS: Relapse Remitting Multiple Sclerosis(3) RMS: Relapsing Multiple Sclerosis
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2012-2015: Key Growth Drivers
● Maximize market opportunity for PGH business
● Increase manufacturing capabilities for Cerezyme® & Fabrazyme®
● Increase Pompe disease awareness/diagnosis
● Launch eliglustat and Kynamro™
● Further expand PGH business through internal and external opportunities
● Establish leading MS franchise
● Launch Aubagio™ and Lemtrada™
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ANIMAL HEALTH
Jose Barella
Chief Executive Officer, Merial
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Market opportunities in Animal Health
Merial - A leader in Animal Health
Strategic priorities for Merial
Agenda
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Animal Health Offers Attractive Business Dynamics
Animal HealthMarket
● Pets increasingly treated as a family member
● Protein consumption increasing given demographic trends and living standards
● Long product life cycles and limited generic competition
● Importance of brand equity
● Complex manufacturing (e.g. biologicals)
● Complex regulatory environment (e.g. food safety, multiple agencies)
● Higher probabilities of success and lower costs of development than human pharma
● Synergies with the human pharma business
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31%
69%
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A Diversified Market by Region and Species
2010 Market Split by Segment
A €15bn market in 2010
2010 Market Split by Geographic Area
69% 31%
59%
41%
41% Companion animals• Dogs, Cats• Horses• Other
59% Production animals• Cattle, Sheep• Pigs• Poultry• Veterinary Public Health
Developed Markets• United States • Western EU• Japan, Canada, Australia,
New Zealand
Emerging Markets• Latin America• Asia • Eastern Europe• Middle East, Africa
Source: Vetnosis ($20bn 2010 market converted to Euro at 1.3$/Euro); Sanofi regional format.
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Companion Animals
Strong Growth Drivers in Both Segments
● Increased consumption of protein food in Emerging Markets - “Feed the planet”
● Increased medicalization of animal population to improve animal yields
● Convenience for mass medicalization
● Focus on prevention
Production Animals
● Increasing human / pet emotional bond –“Pet as a family member”
● Pets is the largest individual AH segment
● Aging populations in western countries
● Growing GDP per capita in Emerging Markets
● Unmet medical needs (e.g. cancer, diabetes)
2015e2010 2015e2010
€6bn €9bn
MarketCAGR +5%
MarketCAGR +5%
A €20bn market expected in 2015Source: Vetnosis ($20bn 2010 market & $26bn 2015 market converted to Euro at 1.3$/Euro)
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140140
Emerging Markets Expected to Grow Twice As Fast as Developed Markets
Global Animal Health Sales
DevelopedMarkets
2015e
€20bn
64%
36%
2010
€15bn
69%
31%
CAGR ~4%
CAGR~8%
EmergingMarkets
Source: Vetnosis ($20bn 2010 market & $26bn 2015 market converted to Euro at 1.3$/Euro); Sanofi regional format.
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Market opportunities in Animal Health
Merial - A leader in Animal Health
Strategic priorities for Merial
Agenda
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Merial Has Strong Positions in Both Companion and Production Animals Segments
142
A Strong Foothold in Production Animals
The Leader in Companion Animals & Parasiticides
(2010 Proforma Sales) (2010 Proforma Sales)€1.3bn
€0.7bn
Source: Vetnosis
Medicated Feed Additive
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#1 Animal Health brand(1)
Parasiticide controlling fleas and ticks for pets
Top-tier Pets brandParasiticide controlling heartworms for pets
Internal and external parasiticide control for cows, sheep and pigs
Recombinant DNA vaccinesMerial is a leader in pets vaccines
Leading innovative recombinant vaccine for poultry
A Wide Range of Leading Premium Brands
(1) Vetnosis 2010 product ranking
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A Broad, Diversified Geographic Footprint
● Merial’s strength is led by the #1 position in the U.S., the largest Pets market(1)
● 23% of sales in Emerging Markets, approaching Western Europe in size (vs. 19% in 2007)● ~50% of Emerging Market revenues
are from Latin America ● Growth driven by Asia and
Latin America● Room for further expansion
8%
42% U.S.
27%
WesternEurope
23%Emerging
Markets
Other Countries
Merial: 2010 Sales Split by Region
(1) Vetnosis
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Market opportunities in Animal Health
Merial - A leader in Animal Health
Strategic priorities for Merial
Agenda
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Strategic Priorities for Merial
Pursueopportunities in
Emerging Markets
Ensure steadyprogression of a
balancedportfolio
Diversify portfolio:
opportunistic acquisitions
andalliances
Leverageindustrial assets
Reinforceposition in core
markets
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147147
Core Markets
Animal Health Products Have Long Life Cycles
● Absence of third party payers limits attractiveness for competitive entries
● Long product life cycles of pioneer brands(1)
● Average of 60% molecular share despite generic competition
● Average age of compounds exceeds 30 years
● Merial brand awareness will be key in its defense against generics
Frontline® EMEA(2) Sales
Limited impact of Frontline® generics in major markets
Branded generic entry
(1) Vetnosis study on the top 50 compounds of the AH industry based on 2008 sales. Average computed based on a universe of 35 compounds subject to generic competition.
(2) EMEA: Western Europe, Eastern Europe, Middle East, Africa
6/2008 6/20106/2009 6/2011
Last 12 Month Sales
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Core Markets
Reinforcing our Leadership in Pet Parasiticides
● Frontline®: largest product in the Animal Health market● 2010 sales of €762m
● Strong IP rights(1)
● U.S. compound patent expired in 2010
● Key patents: formulation, fipronil manufacturing process, and combination
● New products
● Certifect®: U.S. launched in Q3 2011; ROW launch planned in 2012
● Next generation Pet Parasiticides
Merial: Estimated Pet Flea & Tick Sales
2011 2013 20152012 2014
Frontline®
New pet parasiticide products
(1) The U.S. District Court for the Middle District of Georgia ruled that Velcera and Cipla are in contempt for sales of Pet ArmorPlusTM products (fipronil + methoprene) and enjoined (prohibited) such sales
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Emerging Markets
Maximizing the Emerging Markets Opportunity
Merial Strategy
(1) Merial internal estimates, VPH: Veterinary Public Health(2) Vetnosis
Animal Health in Emerging Markets
● Focus on Production Animals by leveraging strongholds:● Grow Avian leadership● Invest in Swine franchise ● Expand Ruminant position● Secure #1 VPH(1) position
(Foot and Mouth disease, etc.)
● Enhance position as Pets leader(2)
● Leverage Sanofi footprint
● Market needs still fairly basic● Cost sensitive, generic markets● Growth from Production Animals
linked to demand for protein● Pet market only in early stages
of development● High barriers to entry
● India: local production● China: government control
over specific disease treatments
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R&D Portfolio
Robust Development Pipeline
● 6 launches in 2011● Certifect® for flea, tick control● Zactran® for Bovine Respiratory Disease● Equine West Nile Virus vaccine● Supleneo®, a nutraceutical for joint health● Feline Rabies vaccines for EU● Blue Tongue Virus 1-8 vaccine
● 27 potential launches from 2011 to 2015● 13 for companion animals● 14 for production animals● 17 biological and 10 pharmaceutical
products
● Consistent R&D investment of ~7% of sales
Projected New Drug Launches(1)
6
7
3
8
3
2011
2012
2013
2014
2015
Higher probabilities of success and lower development costs than human pharma
(1) Projects evaluated with greater than 50% probability of success
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Direct Benefits of Sanofi’s Scale and Expertise
Cost Savings Research Emerging Markets
● Shared services: IS, Finance, Legal, Communications, etc.
● Procurement: Travel, raw materials, services, logistics (freight & distribution), real estate, etc.
● Common technology platforms: expression systems, formulations, delivery devices
● Molecule discovery for Pets: pain management, oncology, diabetes, etc.
● Sanofi’s strength and established presence enable Merial to move quickly
● Initiative to leverage Sanofi footprint in India and Russia in the near term
Operating margin projected to further increase
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Animal Health: A Sustainable Growth Platform
● Strong industry fundamentals
● Reinforce positions in Mature Markets, extend the pet parasiticide franchise, strengthen position in production animals
● Capture Emerging Markets growth supported by Avian, VPH and Sanofi’s footprint
● Deliver on key pipeline projects: new launches expected to account for >20% of 2015 sales
● Improve operating margin through manufacturing efficiencies and integration into the Sanofi organization
● Selected opportunistic business development transactions
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CONSUMER HEALTH CARE
Hanspeter Spek
President, Global Operations
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Market characteristics
Agenda
Growth drivers
Sanofi’s expansion in CHC
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OTC Market Offers Sustainable Growth without Volatility Caused by Patent Expiries
Market Drivers
● Large and highly fragmented market
● Growing propensity to self-medicate
● Importance of brands to convey quality and trust
● M&A still a major focus for growth
● Only a few worldwide brands
● Unregulated pricing
A €77bn Market in 2010(1)
€77bn€74bn€71bn€68bn
2007 2008 2009 2010
OTC market expected to grow to €100bn by 2015(1)
CAGR ~3.4%
(1) Nicholas Hall, OTC YearBook 2011, DB6 2011 (2010 sales)
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Market characteristics
Growth drivers
Sanofi’s expansion in CHC
Agenda
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Sanofi Has Become a Global Player inConsumer Health Care
● Expanded market position beyond European focus of Sanofi’s legacy CHC business
● Enlarged revenue basethrough 11 acquisitions
● Improved presence in the U.S. and China
● Obtained access to new retailand distribution channels in Asia
● Experienced managementrecruited to drive CHC business in regions
● Continued expansion in all key CHC markets through regional hubs
157
#3 in Central &
EasternEurope
Among top 10
in U.S.(2)
#1 in Latin
America
Scaling upin China and Asia
Key Actions
1
2
3
4
5
Results(1)
#1in Australia
6
#3 in Russia
(1) Nicholas Hall, OTC YearBook 2011, DB6 2011 (2010 sales)(2) Including Allegra® OTC sales in 2011, internal estimates
Target of high single digit growth over 2012-2015
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New Strategic Focus in Late 2008 Driving Performance
158
2008 2009 2010 2011e
€1.4bnBolt-on acquisitionsin key OTC markets
~2x
Doubling Global Revenue BaseExpected in Only 2 Years
Strategic Priorities2008-2011
Rx-to-OTC switch strategy e.g. Allegra®
Boost sales ofexisting brands
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Leveraging the Strong Platform of Legacy Brands
159
● Significant contribution from "local champions"
● Total sales of top 5 legacy brands expected to be >€750m in 2011e
● Iconic brands ● Strong brand recognition in local
markets
● Solid presence in key categories● Fever & Pain, Digestive Health
● Continue to drive brand strategy through improved marketing mixes in the countries locally
Doliprane® #1in France
Dorflex® #1in Brazil
NoSpa® #9in Russia
Enterogermina® #2in Italy
Essentiale® #2in Russia
TOTAL
1) IMS MIDAS MAT Q2 2011
"Local Champions"
2011e sales growth: ~+18%
OTC Ranking(1)
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Addedimportant brandequity to existingCHC business
Significant transactions in established and
emerging CHC markets in 2008-2011
Building a Strong CHC Base through Bolt-on Acquisitions and Organic Growth
160
CHC Sales Split in 2011e
Others
CHC revenue base increased through acquisitions by >€800m
Doliprane®
Essentiale®
Enterogermina®
Maalox®
No-Spa®
Magne B6®
Dorflex®
Lactacyd®
Top existing brandsAllegra®
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Agenda
Market characteristics
Growth drivers
Sanofi’s expansion in CHC
161
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Key Growth Drivers
Expanding in the U.S.
Reinforcing brand equity in Europe
Investing in the dynamic CHC market in China
1
2
3
Strengthening #1 position in Australia(1)4
Rx to OTC switches5
(1) Nicholas Hall, OTC YearBook 2011, DB6 2011 (2010 sales) 162
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EXPANDING IN THE U.S.
Strengthening U.S. Position
● Filled geographic hole in global presence● Immediate “leadership”
position in U.S.
● Large portfolio of OTC products● Allergy, skincare,
topical pain, toiletries
163
● Switch Allegra® from Rx to OTC in U.S.
● Development of Chattem portfolio in the U.S. and beyond
● Operating margin estimated among best-in-class OTC players
OTC Acquisition Value Creation
1
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H1 2010 H2 2010 H1 2011
EXPANDING IN THE U.S.
U.S. Sales Up Almost 100%
164
CHC U.S. Sales
$442m
$225m
1
$188m(1)
1) Chattem was acquired by Sanofi on February 9, 2010
®
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EXPANDING IN THE U.S.
Allegra® – A Very Successful Rx to OTC Switch
● Launched in March 2011
● Exceptional trade success and speed to market
● Premium merchandising and promotional support
● Successfully building brandawareness
● Allegra® #2 brand in the category(1)
165
0 2 4 6 8
10 12 14 16 18
7/8/10
2/10/1
0
4/9/10
10/30
/1011
/27/10
12/25
/101/2
2/11
2/19/1
13/1
9/11
4/16/1
15/1
4/11
6/11/1
17/9
/11
Claritin® Zyrtec®Allegra®
Nielsen Unit Share (%)(1)
4 weeks ending
1
(1) A.C. Nielsen Food, Drug and Mass excluding Walmart (represents 64% of all outlets) 4-week data through week ending 8/6/2011
8/6/11
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Harmonizing Marketing Mixes of Pan European Brands for Profitable Growth
Category Available in
DIGESTIVE HEALTH Maalox® 12
countries
HEALTH CAPITAL Magne B6® 8
countries
BEAUTY Oenobiol® 7 countries
ALLERGY Allegra® /Telfast®
8 countries
● Existing pan European brand equity and recognition
● Broader presence across key categories helped by acquisitions
● Improve advertising and promotional efficiency by harmonizing marketing mixes
● Seamless execution of multi-country launches
Pan European Brands
GROWING IN EUROPE2
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GROWING IN EUROPE
Opportunity to Build Pan European Umbrella Brand
6 different local brands
1 European Umbrella Brand
8 countriesDifferent package designs and
promotional campaigns
● Allergy category – Attractive growth area for CHC in Europe
● >€300m category(1)
● Highly fragmented
● Opportunity to consolidate Sanofi’s localized anti-allergy portfolio
● Diverse portfolio of multiple brands mainly in smaller countries
● Objective to develop a pan European umbrella brand to provide complete solution for Allergy needs
Harmonization of brand marketing mix
Advertising and promotional investmentCost of goods sold
Developing an Umbrella Brand in the Allergy Category
2
(1) IMS-OTCIMS (MAT Q1 2011)
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Scaling up to createtop position in China
and Asia
Acquired leadership in the two biggest
categories in China(3)
Leverage platform by access to expanding distribution channels
INVESTING IN CHINA
Accelerating CHC in China
M&A and Joint Venture
Three-pronged Strategy in Consumer Health Care in China
Organic Growthand OTC Switches
• Lactacyd® launched in May
• Essentiale®
CHC expected to generate >10% of total China sales by 2015
1 3Enlarge Portfolio
• Vitamins, Minerals, Supplements(1)
• Cough & Cold(2)
2
(1) 21 Super Vita: #2 VMS brand by volume in China (IMS Pharmatrend June 2011)(2) Good Baby: #3 Cold brand by value in China (IMS Pharmatrend June 2011)(3) Nicholas Hall, OTC YearBook 2011, DB6 2011 (2010 sales)
3
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GROWTH IN AUSTRALIA
Built #1 Position in Australia
169
4
Strong Brands
Vitamins & Mineral Supplements
Symbion Deal
Symbion deal in 2008 laid foundation for Sanofi’s leadership in OTC market(1)
Enhanced #1 position in VMS category through acquisition of leading Vitamin D brand(2)
1) Nicholas Hall, OTC YearBook 2011, DB6 2011 (2010 sales)2) Aztec information systems, National Market data, July 2011
CHC contributing to redesign of Australian affiliate profile
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Strategic Priorities for Future Growth in Consumer Health Care
170170
● Opportunity for global coordination of product development
● Further expansion of geographical reach in Emerging Markets
● Harmonizing marketing mixes to boost investments behind brands
● New launches of existing brands from other regions
● Cenovis®, Lactacyd®, Essentiale®
● Rx to OTC switch opportunities actively pursued
● Targeted M&A opportunities locally and globally
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2012-2015 FINANCIAL INDICATORS & CAPITAL ALLOCATION
Jérôme Contamine
Executive Vice President, Chief Financial Officer
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172
Agenda
Impact of U.S. Plavix® and Avapro®
Cost savings
Margin trends
Capital allocation
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2012-2015
One Last Significant Headwind Remaining
Evolution of Group "Other Revenues"
Evolution of Group "Associates"
(1) Avapro® on March 30, 2012 and Plavix® on May 17, 2012
2012e2011e2010 2010 2012e2011e
€1,036m€1,651m
Patent Expiry of Plavix® and Avapro® in the U.S.(1)
- 54% - 61% 2012e ~ €1.4bn
2013e ~ €700m
Impact on Business Net Income
Evolution
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174
Agenda
Impact of U.S. Plavix® and Avapro®
Cost savings
Margin trends
Capital allocation
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Significant Cost Synergies Expected from the Acquisition of Genzyme…
$700mSynergies Split
0% 10% 20% 30% 40% 50% 60%
IndustrialAffairs
R&D
Operations
SupportFunctions, ISand Other
● Level of cost synergies expected to reach $700m by 2013
● Around 30% of 2010 OpEx baseline
● Main drivers of cost synergies:
● Integration of Oncology in Sanofi
● R&D sharing platform and leveraging Boston as a hub for Sanofi in the U.S.
● Focus on purchasing and CapEx efficiency in Industrial Affairs
● Shared organisation for support functions per country/region
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New Initiatives Combined with Genzyme Expected to Generate Total Cost Savings of €2bn by 2015
Cost savingsof
€2bn(2)
● CoGS● Industrial network balancing ● Increased headcount producitivity: +7% pack p.a. /FTE ● Increase global capacity utilization by 10% (2010-2015)
● R&D(1)
● Flat to slightly declining expenses
● Commercial operations● Reinforce new operating model in mature markets
● Purchasing● Continue to improve purchasing cost
● Support functions● Leverage shared services and North American model
● Merial synergies● Genzyme synergies
(1) 2011 R&D expenses on a proforma basis should reach around €5bn(2) At CER, before inflation and tax on a constant structure basis 176
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177
Agenda
Impact of U.S. Plavix® and Avapro®
Cost savings
Margin trends
Capital allocation
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2012-2015
Business Operating Margin Set to Rebound from 2012
Business Operating Margin Evolution
ILLUSTRATIVE
Synergies from Genzyme and Merial
Leveraging growth platforms
2012~31%
New cost savings programs
2015
Sustained profitability improvement of growth platforms expected from 2012 to 2015
178
Impact of Plavix®
and Avapro®
in the U.S. (1)
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2012-2015
Main Metrics Set to Improve in a Post Patent Cliff Era
Sales
Gross margin
R&D expenses
Operating cash flow
GROWING
IMPROVING
FLAT to DECLINING
STRONG
SG&A ratio IMPROVING
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180
Agenda
Impact of U.S. Plavix® and Avapro®
Cost savings
Margin trends
Capital allocation
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181
2012-2015
Deploying Capital Effectively
Free cash flow use(1)
Balanced Capital Deployment
Externalgrowth
CapEx and working capital
management
Shareholder returns
Debt reimbursement
1 2 3 4
(1) After R&D investments
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182
2012-2015
Strong Control of Investment Policy
2008 2009 2010 2011e 2013e
€1,409m €1,414m€1,274m
Pharma& Others
Vaccines
Genzyme
Keeping Tight Control on CapEx
1
Targeting CapEx range of €1.5bn to €1.6bn as from 2013
● Strong improvement in working capital management in 2010 and H1 2011
● Further improvement expected by 2013● Optimizing purchase to pay
progress
● Reduce inventories to CoGS by at least 1 month (except Genzyme)
● Stabilize DSO despite change in business mix
Streamlining Working Capital
CapEx excluding product acquisitions
Merial
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183
Net Debt Evolution
2012-2015
Optimizing our Capital Structure2
2012e
~€10bn(1)
End Q2 2011
€13.2bn
2010
€1.6bn
● Reasonable leverage
● Strong commitment to retain solid credit ratings
● Current ratings:● Moody’s:
A2- stable outlook
● Standard & Poor’s: AA- stable outlook
(1) At 1.40 $/€
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184
2012-2015Near Term Bolt-on Acquisitions to Strengthen Growth Platforms
3
Business Development Priority Areas
● BD activities to continue to strengthen Growth Platforms
● Potential for bolt-on acquisitions in the near term of €1bn to €2bn
● Further R&D partnerships
● Consumer Health Care, Animal Health● Enlarge portfolio and
develop global presence
● Emerging Markets● Seize opportunities to
generate sales synergies
● R&D partnerships focused on early stage projects
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2012-2015
Sustaining Higher Shareholders Returns
● Progressive increase of payout target to 50% in 2014(1)
● Opportunistic use of share repurchasing to tackle dilution over time
20142011
€2.50
2010
€2.40
2009
€2.20
Evolution of Dividendby year of payment
4
Payout35%
Payout50%
(1) Dividend paid in 2014
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2012-2015 GROWTH OUTLOOK
Christopher A. Viehbacher
Chief Executive Officer
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2012-2015Targeting at Least 5% Compounded Annual Growth Ratefor Group Sales
(1) Incl. Jevtana®, Multaq®
(2) Historical Genzyme perimeter including LemtradaTM
(3) Incl. BGM, Lyxumia®
Growth Platforms & Genzyme: >80% of Group sales
Total Group Sales
2015e
New products(1)
Animal Health
Vaccines
Consumer Healthcare
Genzyme(2)
Diabetes(3)
Pharma Emerging
Other
2008
Growth Platforms
Other
KeyGenericized
Animal Health
Vaccines
Consumer Healthcare
Diabetes(3)
Pharma Emerging
Other
Key Gen.
2012e
CAGRat least 5%
2011e
Key Gen.
Other
Growth Platforms
€27.6bn
Genzyme(2)
Lovenox® U.S., Plavix® Western EU, Taxotere® Western EU & U.S., Eloxatin® U.S., Ambien CR® U.S., Allegra®
U.S., Aprovel® Western EU, Xyzal® U.S., Xatral® U.S., Nasacort® U.S. - Generic makers of oxaliplatin (Teva, Fresenius Kabi (formerly Dabur), Sandoz, Mayne/Hospira, MN/Par, Actavis and Sun) required to cease selling in the U.S. since June 30, 2010 but litigation continues. 187
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2012-2015
Dynamic Growth From Multiple Growth Platforms
Emerging Markets
Vaccines
AnimalHealth
Consumer Health Care
Diabetes Solutions
2012e-2015e CAGR Sales Growth >5%
New Genzyme(1)
Growth Rate Scale
Double digit High single digit Mid single digit
(1) Personalized Genetic Health and Multiple Sclerosis188
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Conservative assumptionsof R&D contribution
embedded in 2015 estimates
Low exposureto small molecule generic entries
in mature markets(1)
2012-2015
Offering a Lower Risk Profile
● Only 6% of post cliff sales come from small molecules facing generic exposure over 2012-2015
● Biological portfolio not expected to have significant competition from biosimilars by 2015
● 2015e sales projections do not include significant sales from new product launches over 2012-2015 (5 to 7%)
189(1) 6% of 2012 sales estimates
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Six NME Filings Expected in 9 Months
Kynamro™ (mipomersen)– hoFH and severe heFH in Jul 2011 in EU and hoFH in Q4 2011 in the U.S.
1
2 Aubagio™ (teriflunomide)– RMS in Aug 2011 in the U.S. and Q1 2012 in EU
3
Zaltrap™ (aflibercept)– 2L-mCRC in Sep 2011 in the U.S. and Q4 2011 in EU
4
Lyxumia® (lixisenatide)– Type 2 diabetes in Q4 2011 in EU
5
Lemtrada™ (alemtuzumab)– RMS in Q1 2012 in the U.S. and EU
6
hoFH: Homozygous Familial HypercholesterolemiaheFH: Heterozygous Familial HypercholesterolemiaVTE: Venous Thrombo Embolism
RMS: Relapsing Forms of Multiple SclerosismCRC: Metastatic Colorectal CancerNME: New Molecular Entity
Visamerin® / Mulsevo® (semuloparin)– VTE prevention in chemo-treated patients in Sep 2011 in the U.S. and EU
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Expected regulatory submission of Zaltrap® in 2nd line mCRC in EU
Expected regulatory submission of Lyxumia® in EU
Phase III top-line results of Lemtrada™ in multiple sclerosis (CARE-MS 2)
Phase III top-line results of Aubagio™ in multiple sclerosis (TENERE)
Solid R&D Newsflow Expected in Next 12 Months
Q3 2011
Q4 2011
Q4 2011
Q4 2011
Q4 2011
Q4 2011
Q4 2011
Q1 2012
Key Milestones Timing
Phase II results of Zaltrap® in 1st line mCRC (AFFIRM)
Lyxumia® in Type 2 diabetes - Further Phase III data presentation
Expected regulatory submission of Kynamro™ in U.S. for hoFH
Expected regulatory submission of Aubagio™ in EU
191
Q1 2012Expected regulatory submission of Lemtrada™ in MS in U.S. and EU
Q1 2012
Q2 2012
Start of Phase III for Fluzone® QIV ID
Scientific opinion for Hexaxim® issued by EMA
Q4 2011Start of Phase III for Vaxigrip® QIV IM
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PGH & MS
DiabetesOncologyOther Pharma
Ophthalmology
Vaccines
Note: Scope includes pharmaceuticals NMEs (excluding LCM) and vaccines. Only first launches in a given market are mentioned.
2012-2015
Nineteen Potential New Launches
69
13
19
Kynamro™(mipomersen)
Lemtrada™(alemtuzumab)Aubagio™(teriflunomide)
Lyxumia®
(lixisenatide)Zaltrap™(aflibercept)
Visamerin®
(semuloparin)
Hexaxim®
ombrabulin
Dengue vaccine
eliglustat
SAR302503(JAK-2 inhibitor)
otamixaban
DTP-HepB-Polio-Hib
FOV1101(prednisporin)
SAR236553anti-PCSK-9 mAb
iniparib
sarilumabanti IL6R mAb
2012 2013 2014 2015
Cumulative Number of ProjectsPharmaceuticals (excluding LCM) and Vaccines
Fluzone® QIV IM
Quadracel®
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Leveraging our P&L from 2012 to 2015
EPS 2015eEPS 2012e
Business EPS CAGRgreater than Sales CAGR
2012-2015
Targeting Business EPS Growth Superior to Sales Growth
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2012-2015
Sanofi - A Strong Scorecard for 2012-2015
2012-2015 Sales CAGR
Diversified sources of growth
Scale in businesses with significant barriers to entry
Low small molecule patent exposure in mature markets(1)
Large Emerging Markets presence(2)
Potential new product launches(3)
Operating margin evolution
2012-2015 Business EPS CAGR
Increased dividend payout ratio
(1) 2012 sales from chemical products exposed to patent expiry in the U.S., Japan and Western Europe over 2012/2015(2) Based on 2015 internal estimates(3) Over 2012-2015(4) Dividend paid in 2014
~6%
50% by 2014(4)
19
38-40%
Rebounding
> Sales CAGR
At least 5%
194
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IN SUMMARY
The New Sanofi Offers An Attractive Profile
5. Track record of successful execution
1. Consistent and sustainable growth outlook
2. Growth Platforms & Genzyme expected >80% of sales by 2015
3. Unparalleled position in Emerging Markets
4. Emerging R&D pipeline of higher quality assets
195
6. Lower risk profile
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IN SUMMARY
Sanofi: A Rare Intersection Between Growth, Quality and Value
GrowthQ
ualit
yValue
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APPENDICES
R&D Pipeline
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Late Stage Pipeline – Pharma & Vaccines
N New Molecular Entity
G GenzymeCentral Nervous System
Genetic diseases
OncologyMetabolic Disorders
Vaccines
Internal Medicine
RegistrationPhase III
Biosurgery
* ORIGIN: Evaluation of Lantus® in reducing cardiovascular morbidity & mortality
iniparib(BSI-201)
mTNBC; squamous LC
otamixabanDirect Xa inhibitor
ACS
Quadracel®Diphtheria, tetanus, pertussis& polio vaccine; 4-6 y of age
Hexaxim®
DTP-HepB-Polio-Hib vaccine
afliberceptVEGF-Trap
2nd line mCRC; 1st line mHRPC
semuloparin (AVE5026)Indirect Xa/IIa inhibitor
VTE prevention in cancer patients
Fluzone® QIV IMQuadrivalent inactivated influenza
vaccine
Plavix®
clopidogrel bisulfate Pediatric, EU; Stent, Japan
ombrabulin (AVE8062)Vascular disrupting agent
Sarcoma
Plavix®
clopidogrel bisulfate PAD, Japan
DengueMild-to-severe
dengue fever vaccine
mipomersenApolipoprotein B-100 antisense
hoFH and severe heFH (EU)
Clolar® / Evoltra®
Purine analogueAdult acute myeloid leukemia (AML)
Lantus®
insulin glargineORIGIN*; Pediatric, EU
DTP-HepB-Polio-HibPediatric hexavalent vaccine
teriflunomideRelapsing forms of multiple sclerosis
(RMS) – monotherapy (U.S.)
teriflunomideMultiple sclerosis
(monotherapy, adjunct therapy & CIS)
lixisenatide (AVE0010)GLP-1 agonist
Type 2 diabetes
Allegra®
fexofenadineDry syrup, Japan
alemtuzumab Anti-CD52 mAb
Multiple sclerosis
mipomersenApolipoprotein B-100 antisense
hoFH (U.S.)
sarilumab (SAR153191)Anti-IL-6R mAb
RA
MACI®Cell-based treatment
Articular cartilage defects
eliglustat tartrateGlucosylceramide synthetase inhibitor
Gaucher disease
prochymalMesenchymal stem cell
Graft-versus-host disease
N
G
G
G
N
N
N
N
N
N
N
G
NG
Thrombosis
NG
N
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Early Stage Pipeline – Pharma & Vaccines
N New Molecular Entity
G GenzymeCentral Nervous SystemCardiovascularGenetic diseases
OncologyMetabolic Disorders
Vaccines
Internal Medicine
Phase II
Ophthalmology
iniparib (BSI-201)
Ovarian cancer, non-squamous NSCLC, neoadjuvant breast cancer
FOV1101FDC prednisolone/ cyclosporine
Allergic conjunctivitis
SAR231893Anti-IL4 mAb
Asthma; Atopic dermatitis
afliberceptVEGF-Trap
1st line colorectal cancer
FOV2302Plasma kallikrein inhibitor
Retinal vein occlusion induced macular edema
ferroquineAntimalarial
Malaria
SAR256212 (MM-121)anti-ErbB3 mAbBreast cancer
FOV2304Bradykinin B1 antagonistDiabetic macular edema
fresolimumab (GC1008)TGFβ antagonist
Fibrosis
SAR245408 (XL147)Oral PI3K inhibitorEndometrial cancer
SAR164877Anti-NGF mAb
Pain(on clinical hold)
ACAM-CdiffClostridium difficile
Toxoid vaccine
SAR245409 (XL765)Oral dual inhibitor of PI3K & mTOR
Cancer
SAR110894H3 antagonist
Alzheimer's disease
RabiesmAb post exposure prophylaxis
ombrabulin (AVE8062)Vascular disrupting agent
Ovarian 2nd line, NSCLC 1st line
atalurenTranscription modulator
Cystic fibrosis
Rabies VRVgPurified vero rabies vaccine
SAR236553 (REGN727)Anti-PCSK-9 mAb
Hypercholesterolemia
Multaq®
Antiarrhythmic agentAtrial fibrillation, Japan
Meninge ACYW conj.2nd generation meningococcal
conjugate Infant vaccine
Recombinant human TSH Modified (rhTSH-M)
Goiter
N
N
N
N
N
N
N
N
N
N
N
G N
G N
NG
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Early Stage Pipeline – Pharma & Vaccines
Phase ISAR153192
Anti-DLL4 mAbCancer
Genz644282Topoisomerase-1 inhibitor
Solid tumors
Gene therapy (sFLT-01)Age related Macular Degeneration
(AMD)
SAR114137Cathepsin S/K inhibitor
OA pain & Peripheral neuropathic pain
SAR3419Maytansin-loaded anti-CD19 mAb
non-Hodgkin’s lymphoma
Mozobil® (plerixafor)CXCR4 AntagonistTumor Sensitization
Gene therapy (AAV-AADC)Parkinson's disease
SAR152954H3 antagonist
Sleep disorders
SAR256212 (MM-121) anti-ErbB3 mAb
Solid tumors, ovarian cancer
tasidotin(GC1008) Microtubule disrupter
Melanoma
SAR339658VLA 2 antagonist
Inflammatory Bowel disease
SAR411298FAAH inhibitorCancer pain
SAR103168Multikinase inhibitor
AML
Oral clofaribinePurine analogue
Myelodysplastic syndromes
SAR113945IKK-β inhibitorOsteoarthritis
RotavirusLive Attenuated Tetravalent
Rotavirus oral vaccine
SAR650984Anti-CD38 naked mAb
Hematological malignancies
SAR407899Rho kinase inhibitor
Diabetic nephropathy
SAR292833 (GRC15300)TRPV3 antagonist
Neuropathic pain, osteoarthritic pain
Streptococcus pneumoniaMeningitis & pneumonia vaccine
SAR302503 (TG101348)JAK-2 inhibitor
Myelofibrosis, refractory polycythemia
lixisenatide + Lantus®
GLP-1 agonist + insulin glargineSngle pen device / Type 2 diabetes
SAR100842LPA-1/LPA-3
Internal medicine
Pseudomonas aeruginosaAntibody fragment product
Prevention ofventilator-associated pneumonia
SAR566658Maytansin-loaded anti-DS6
Solid tumors
SAR101099Urotensin II receptor antagonist
Diabetic nephropathy
SAR279356 (F598)Anti-PNAG mAb
Serious infections
Tuberculosis Recombinant subunit vaccine
SAR307746 (REGN910)Anti-Ang2 mAb
Cancer
New formulationInsulin glargine
Type 1+2 diabetes
SAR97276Antimalarial
Malaria
RetinoStat®
Gene therapy Wet age-related macular degeneration
(AMD)
SAR125844Met kinase inhibitor
Solid tumors
Acid sphingomyelinaseNiemann-Pick type B
SAR156597IL4/IL13 Bi-specific mAb
Idiopathic Pulmonary Fibrosis
SAR104772/SAR126119TAFIa inhibitor
Acute ischemic stroke
N
N
N
N
N
N
N
N
N
G
G
N
N
G
G
N New Molecular Entity
G GenzymeCentral Nervous System
Genetic diseasesOncologyMetabolic Disorders
VaccinesInternal Medicine
Thrombosis
Ophthalmology
N
N
N
N
N
N
N
N
N
N
N
N
N N
G
G N
NG
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Phase I Phase II Phase III Registration TOTAL
Oncology 10 3 3 0 16
Metabolic Disorders 2 2 1 1 6
Thrombosis 1 0 2 0 3
Central Nervous System 3 2 0 1 6
Internal Medicine 7 3 2 0 12
Ophthalmology 1 3 0 0 4
Genetic Diseases 3 1 1 0 5
Vaccines 4 4 4 1 13
TOTAL 31 18 13 3
R&D Pipeline Summary TableNew Molecular Entities (NMEs) and Vaccines
49 16NMEs & Vaccines
52
65
201