- Sanofi on Monday admitted its hopes for a hemophilia drug acquired in last year's $11 billion buy of Bioverativ were too optimistic, taking a roughly $2 billion impairment charge on Eloctate due to slowing sales in the U.S. and revised revenue projections.
- The write down acknowledges the substantial pressure Roche's rival Hemlibra has exerted on the market for hemophilia medicines, particularly older and less convenient therapies like Eloctate. For Sanofi, Hemlibra's success has cast some doubt on its push into hemophilia via Bioverativ.
- Yet any disappointment from the Eloctate announcement was balanced by a quarter in which Sanofi's Dupixent appeared the market-leading drug the French pharma has long touted it to be. Sales from April through June totaled 490 million euros, or about $545 million, up 51% from first quarter numbers and beating Wall Street estimates by about $100 million.
Sanofi envisioned its foray into hemophilia going differently than it has to date.
When the drugmaker bought Bioverativ last year, executives knew Hemlibra (emicizumab) would present a competitive challenge, but thought any effect would be largely limited to a smaller subset of patients with more severe hemophilia A.
"We really believed that the trajectory in the U.S. for the non-inhibitor market would be slower," said Sanofi CEO Oliver Brandicourt, referring to hemophilia patients without treatment-limiting antibodies, on a second quarter earnings call Monday.
Several safety questions on Hemlibra's broader use also factored into Sanofi's confidence that its $11.6 billion bet on legacy hemophilia treatments was well placed, Brandicourt said.
Hemlibra, though, quickly made large inroads into both the inhibitor and non-inhibitor markets, and that pressure slowed Eloctate sales by 16% in the U.S.
Brandicourt argued Bioverativ remains the foundation of Sanofi's rare blood disease business and that it would deliver "substantial value."
In hemophilia, whether that comes to pass will largely depend on an more potent, experimental molecule called BIVV001 that Sanofi hopes to file for approval in 2023. A Phase 3 trial of the drug is set to begin this year.
A separate deal with Alnylam for its RNA interference therapeutic targeting anti-thrombin in hemophilia A and B represents another opportunity.
While hemophilia sales remain modest, those of Sanofi's Dupixent (dupilumab) took a major step up during the second quarter, driven mainly by higher demand.
Sales for the anti-inflammatory therapy are now annualizing at $2 billion, which would make it a top two or three best-selling product for Sanofi. New-to-brand prescription growth was boosted by launches in asthma and in adolescent atopic dermatitis.
Dupixent's strength helped grow Sanofi Genzyme revenues by 21% year over year, and contributed to a near 6% jump in company sales after accounting for the divestment of its generics business in the U.S.
Sanofi will need Dupixent to spell it through an R&D restructuring that's seen it trim 13 development and 32 research projects through the first half of this year. Among them is Zynquista (sotagliflozin), a diabetes drug rejected by the FDA in March. Last week, Sanofi said it would end a $1.7 billion collaboration with the drug's developer, Lexicon, after seeing the results for three Phase 3 studies.