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Sanofi will build Consumer Healthcare's scale
Τετάρτη 11 Νοέ 2015
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Sanofi plans to strengthen its Consumer Healthcare business with new product categories and bolt-on acquisitions, according to chief executive officer Olivier Brandicourt. 
Announcing a new five-year strategy for the French pharmaceutical company, Brandicourt said Sanofi was exploring strategic options, including divestment, for its Merial animal health business and European generics operation.

Brandicourt, who took over as chief executive officer of Sanofi in April 2015, said the company wanted to achieve "leadership" in consumer healthcare. He noted that Sanofi's Consumer Healthcare business was the number five OTC player globally in 2014 with a market share of 3.2%.

Worldwide sales at Consumer Healthcare were €2.68 billion (US$2.89 billion) in the first nine months of 2015, representing a rise of 3.3% at constant exchange rates compared to the same period a year earlier. As reported, sales were up by 6.5%.

Vincent Warnery, senior vice president of the global Consumer Healthcare division, said the business was growing faster than its competitors with a Compound Annual Growth Rate (CAGR) of 7.4% from 2010-2014. The 7.4% rise represents organic growth at constant exchange rates.

Brandicourt said Sanofi Consumer Healthcare aimed to "maximise the value of existing brands" by managing them with "speed, agility and consumer focus".

Furthermore, he said Consumer Healthcare intended to "shape new categories". He noted, for example, that the business was preparing the potential prescription-to-OTC switch of the erectile dysfunction drug Cialis (tadalafil).

Sanofi announced in May 2014 that it had acquired exclusive rights to OTC versions of Lilly's Cialis in the US, Europe, Canada and Australia. Terms of the licensing agreement were not disclosed.

He also pointed out that Consumer Healthcare intended to "build scale through bolt-on acquisitions". The business wants to reach critical scale in key countries and priority categories.

Reasons for staying in consumer healthcare

Brandicourt said there were three reasons why Sanofi wanted to stay in the consumer healthcare market.

"Firstly, consumer healthcare is a highly-fragmented market that is ripe for consolidation," commented Brandicourt. "Second, it offers consistent growth with different dynamics to the branded prescription market, and third, it is a good portfolio fit where we can capture real synergies."

Building a competitive position for Sanofi's Consumer Healthcare business is part of a new strategic roadmap for the overall company over the next five years. This long-term strategy rested on four pillars, said Brandicourt, adding that these were reshaping the portfolio, delivering outstanding launches, sustaining innovation in research and development, and simplifying the organisation.

Brandicourt said the pharmaceutical industry was "undergoing a transformation unlike anything we have previously seen". "Continued consolidation in the sector has created a more competitive environment over the past few years," he observed, "and science has never been more exciting."

Sanofi will remain diversified

He said Sanofi would "remain diversified, but with a portfolio refocused on areas where we can win, and innovation driven to improve the lives of millions of people". The diversified company would be present in Pharmaceuticals, Vaccines and Consumer Healthcare, he added, and would seek "external opportunities to enhance its growth profile".

Brandicourt explained that Sanofi aimed to "sustain its leadership" in diabetes/cardiovascular, vaccines, rare diseases and emerging markets. Furthermore, he added, the company would build competitive positions in multiple sclerosis, oncology, immunology and consumer healthcare.

Meanwhile, he said, Sanofi would explore strategic options for its Merial and European generics businesses.

In July 2015, Sanofi announced plans to restructure its operations into five global business units with effect from the beginning of 2016. The company said its Consumer Healthcare business would be part of a new General Medicines & Emerging Markets global business unit (click here to read the News story).

Commenting on the restructuring at the time, Brandicourt said it "simplifies and focuses Sanofi to optimise growth".

Sanofi expects to deliver a sales CAGR of between 3% and 4% over the period 2015-2020, and is targeting mid-single digit growth in the second half of this period.

Reshaping Sanofi would be the focus from 2015-2017, said Brandicourt, adding that there would be a shift to accelerating growth from 2018-2020.

Πηγή:  OTCToolbox

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