|
 Chris Viehbacher declined to say whether the group would be
interested in Merck & Co's <MRK.N> non-prescription consumer
business or Novartis's <NOVN.VX> animal health operations.
"We can never comment on targets. Clearly, we have growth platforms
such as animal health and consumer health care — if we can
strengthen those while creating value for our shareholders we will
do that," he said.
Merck is considering divesting its healthcare business, best known
for Coppertone sunscreen, Dr. Scholl's foot care and Claritin
allergy medicine. Sanofi is now among several companies cited by
bankers as potential bidders including the likes of Reckitt
Benckiser <RB.L> and Bayer <BAYGn.DE>.
Pricing pressure from cash-strapped governments and tough
competition from generics has prompted many drugmakers to consider
divesting certain non-core business units.
Sanofi, meanwhile, is striving to shake off the impact of patent
losses on key drugs and betting on "growth platforms" — including
rare diseases, over-the-counter treatments and animal health — and
its big cash pile has prompted speculation by bankers it could
complement these through acquisitions.
Viehbacher noted that the company's net debt, at around 6 billion
euros, was well below its 10 billion target.
Sanofi's use of cash has faced market scrutiny since the prospect of
a massive buyback of its shares held by L'Oreal <OREP.PA> has faded.
Some analysts now expect Sanofi will proceed with a share buyback
anyway, to the tune of 2 billion euros this year, to boost earnings
per share and reward shareholders after a disappointing 2013.
"If we don't find acquisitions and the dividend doesn't absorb the
cash, we've always said we'll proceed with opportunistic share
buybacks," Viehbacher said. Sanofi already bought back more than 1.6
billion euros of shares in 2013.
"STRATEGIC" AFRICA
Speaking at Institut Pasteur on the sidelines of a conference on
neglected tropical diseases, Viehbacher said Africa was a "strategic
continent" for Sanofi, which is the international pharmaceutical
company with the highest sales there, at over 1 billion euros last
year.
This revenue should grow in the double digits in 2014 and post
"strong growth" in the next years, he said.
GSK said earlier this week it planned to invest up to $200 million
in African factories and research labs in the next five years.
[to top of second column] |
"It's good that other companies discover Africa," Viehbacher
quipped. "Sanofi is well ahead of all its rivals there," he added,
noting the company had in recent years opened plants in Algeria,
Morocco and South Africa to supply the region with affordable drugs
against malaria and HIV but was also active in mental health such as
epilepsy and depression.
The comments show how Big Pharma now sees Africa not only as an area
of philanthropic work but as a promising commercial market, as
chronic diseases such as diabetes and heart and lung disorders
become more common among the continent's rapidly growing urban
middle classes.
ROOM FOR FURTHER LANTUS PRICE RISES
In diabetes, Sanofi's top-selling drug still has headroom for price
increases in the United States, its biggest market, Viehbacher said,
noting the cost of this insulin — $6 a day — was cheaper than rivals
such as Novo Nordisk <NOVOb.CO> whose treatments go up to $18, and
Lantus should keep a competitive edge.
Lantus prices in the United States rose nearly 30 percent last year,
Deutsche Bank analysts wrote in a recent note. The drug accounts for
17 percent of Sanofi's total sales and roughly 30 percent of its
earnings before interest and tax (EBIT).
"The goal is to have a balanced growth between price and volumes,"
Viehbacher said.
Sanofi is fighting to protect this cash cow from copycat drugs in
the courts, suing rival U.S. company Eli Lilly <LLY.N> for alleged
patent infringements.
The move triggered an automatic 30-month stay of approval by the
U.S. Food and Drug Administration, keeping Lilly's biosimilar drug
off the U.S. market until mid-2016, or until the matter is solved in
court. Technically, the threat could be averted even beyond 2016,
depending on the timing of a court ruling, Viehbacher noted.
(Editing by David Evans)
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