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Inside Sanofi’s Consumer Healthcare and Generics Strategy

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Feb. 21 2017, Updated 7:36 a.m. ET

Consumer healthcare

Sanofi’s (SNY) consumer healthcare franchise offers many products, including Allegra, Doliprane, and Nasacort. At constant exchange rates, the segment reported a 2.7% YoY (year-over-year) growth in revenues, reaching 834 million euros (about $885.3 million) in 4Q16.

The negative impact of Venezuela and the divestiture of small products impacted revenues negatively. Excluding that impact, the franchise’s revenues rose ~2.3%, mainly due to the performance in US markets, followed by Australia, Brazil, Mexico, and Argentina.

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Allegra

Allegra, an antihistamine drug, is used to treat indoor and outdoor allergies. It’s one of the few non-drowsy anti-allergic drugs. Allegra contributed ~10% of the franchise revenues at 86 million euros during 4Q16, which represents a growth of 12% at constant exchange rates as compared to 4Q15.

Allegra competes with Bayer’s Claritin, and Johnson & Johnson’s (JNJ) Zyrtec, and Benadryl.

Nasacort

Nasacort is a nasal spray used for relief in nasal allergies. Nasacort reported a 19% fall in its 4Q16 revenues at 17 million euros, mainly driven by decreased sales in US markets.

Nasacort competes with GlaxoSmithKline’s (GSK) Flonase, Novartis’s (NVS) Otrivin, and Bayer’s Afrin. Few other nasal sprays include Meda Pharmaceuticals’s Dymista and Astepro, and Boehringer Ingelheim’s Atrovent.

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Other products

Doliprane, an analgesic, reported a sequential growth of ~3.6% in its revenues to 86 million euros in 4Q16. Enterogermina, another drug from consumer healthcare products, reported a growth of ~2.9% in its 4Q16 revenues at 36 million euros. Other products include Essentiale, Maalox, and Lactacyd.

Generics franchise

The Generics franchise contributes less than other franchises to Sanofi (SNY) and reported a revenue growth of 0.2% in 4Q16, totaling 468 million euros.

These revenues were driven by overall sales in the US and a generic version of Plavix in Japan. Sanofi and Nichi-Iko Pharmaceuticals launched an authorized generic version of Plavix in 2015 in Japan.

Notably, to divest risk, investors can consider ETFs like the Oppenheimer ADR Revenue ETF (RTR), which has 0.01% of its total assets in Sanofi.

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