Sanofi can't shake its diabetes business blues—and investors aren't happy
- Sanofi had a conference call on Thursday in which the company reported flat diabetes business revenue currently and projected flat sales through 2018. This was particularly bad news, because diabetes-related business accounts for 21% of Sanofi's revenues.
- On the same call, the company predicted that they would introduce 18 new products by 2020 with the potential to generate $37 billion in revenues over the first five years of sales.
- Sanofi is counting on transitioning Lantus (insulin glargine) patients to the newer Toujeo, which is being promoted (ahead of approval) as an "improved" basal insulin with three times the concentration of insulin.
Lantus is currently a $7.6 billion drug. But as it goes off patent, revenues will inevitably decline. Right now, Sanofi's strategy is involves counting on Lantus patients to transition over to Toujeo. That's a risky gambit considering the fact that generic diabetes options are rapidly being approved.
Another problem is the debacle with ousted CEO Chris Viebacher. Although the company touted its pipeline during the conference call, flat revenues in its core business and lack of permanent leadership do not bode well for Sanofi's immediate future. But it's possible that one of the execs being considered for the next top spot at the company can right the ship.