Sanofi delivered close to double-digit Q4 2020 business EPS(1) growth at CER

Sanofi
·48-min read

Q4 2020 sales growth(2) of 4.2% and business EPS growth of 9.8% at CER

  • Specialty Care sales grew 18.3%, driven by strong Dupixent® performance (+54.2% to €982 million).

  • Vaccines up 14.6%, driven by record demand for differentiated influenza vaccines and continued growth of PPH.

  • General Medicines declined 7.5%, reflecting lower U.S. Diabetes sales, COVID environment and portfolio streamlining.

  • CHC down 3.0% due to decreased sales of Cough & Cold related portfolio in Europe partially offset by Digestive Health brands.

  • Leveraged business EPS as the result of prioritization within R&D and continued execution on smart spending initiatives.

  • Sales down 2.4% and business EPS flat on a reported basis, as a result of the overall adverse impact from foreign currency rates.

Full-year 2020 performance

  • Sales increased 3.3% to €36,041 million, driven by Dupixent® (€3,534 million, up 73,9%) and Vaccines.

  • Business EPS of €5.86, up 3.9% on a reported basis and 9.2% at CER ahead of the guidance of 7% to 8%.

  • In 2020, cost savings of €1,680 million were realized of which approximately 60% were reinvested .

  • IFRS EPS of €9.82 (up 338.4%), reflecting capital gain from sales of Regeneron.

  • Entering the sustainable finance landscape with two revolving credit facilities linked to selected sustainability KPIs.

  • Board meeting held on February 4, proposes annual dividend of €3.20.

2021 financial outlook

  • Sanofi expects 2021 business EPS(1) to grow high single digit(3) at CER, barring unforeseen major adverse events. Applying average January 2021 exchange rates, the currency impact on 2021 business EPS is estimated to be between -4.5% to -5.5%.

Sanofi Chief Executive Officer, Paul Hudson, commented:

While last year was an extraordinarily challenging year for all, I am incredibly proud of the measurable progress we made within the backdrop of a global pandemic. Our teams across the world have relentlessly delivered on our strategy with a sharpened focus on operating and financial efficiencies. We bolstered our R&D pipeline with the completion of the Synthorx and Principia acquisitions, met several regulatory milestones to bring our important medicines to patients, and have seen several proofs of concept which reassure us about the priorities we chose. We continue to work in parallel on our two COVID-19 vaccine candidates, with clinical trials starting in the coming weeks. At the same time we want to make a more immediate contribution to help saving lives, which is why we have decided to provide manufacturing support to BioNTech and Pfizer. The continuous uptake and potential of Dupixent® for patients, our contribution to population health with Vaccines, reinforced with the resiliency of our General Medicines and Consumer Healthcare portfolios are all solid foundations to build upon in 2021, helping us achieve our ambition of bringing breakthrough medicines and vaccines to people around the world.

Q4 2020

Change

Change
at CER

2020

Change

Change
at CER

IFRS net sales reported

€9,382m

(2.4%)

+4.2%

€36,041m

(0.2%)

+3.3%

IFRS net income reported

€1,081m

N/A

€12,314m

+338.8%(5)

IFRS EPS reported

€0.86

N/A

€9.82

+338.4%

Free cash flow(4)

€1,530m

(27.5%)

€6,982m

+16.1%

Business operating income

€2,052m

+0.3%

+9.9%

€9,762m

+4.4%

+9.7%

Business net income(1)

€1,527m

(0.5%)

+9.4%

€7,347m

+4.2%

+9.6%

Business EPS(1)

€1.22

0.0%

+9.8%

€5.86

+3.9%

+9.2%

(1) In order to facilitate an understanding of operational performance, Sanofi comments on the business net income statement. Business net income is a non-GAAP financial measure (definition in Appendix 9). The consolidated income statement for Q4 2020 is provided in Appendix 3 and a reconciliation of reported IFRS net income to business net income is set forth in Appendix 4; (2) Changes in net sales are expressed at constant exchange rates (CER) unless otherwise indicated (definition in Appendix 9); (3) 2020 restated business EPS was €5.86; (4) Free cash flow is a non-GAAP financial measure (definition in Appendix 9); (5) includes capital gain from sales of Regeneron shares.

2020 fourth-quarter and full-year Sanofi sales

----------------------------
Unless otherwise indicated, all percentage changes in sales in this press release are stated at CER1

----------------------------

In the fourth quarter of 2020, Sanofi sales were €9,382 million, down 2.4% on a reported basis. Exchange rate movements had a negative effect of 6.6 percentage points, mainly driven by the decrease of the U.S. dollar, Brazilian real, Turkish lira, Russian ruble, Mexican and Argentine pesos. At CER, Sanofi sales increased 4.2%.

Full-year 2020, Sanofi sales reached €36,041 million, down 0.2% on a reported basis. Exchange rate movements had a negative effect of 3.5 percentage points. At CER, Sanofi sales were up 3.3%.

Global Business Units

2020 fourth-quarter and full-year business operating income

Fourth-quarter business operating income (BOI) increased 0.3% to €2,052 million. At CER, BOI increased 9.9%. The ratio of BOI to net sales increased 0.6 percentage points to 21.9% versus the prior year. Full-year 2020, BOI increased 4.4% to €9,762 million. At CER, BOI increased 9.7%. The ratio of business operating income to net sales increased 1.2 percentage points to 27.1%.

1 See Appendix 9 for definitions of financial indicators.

Pharmaceuticals
Fourth-quarter 2020 Pharmaceutical sales increased 2.4% to €6,293 million, with double-digit growth of the Specialty Care portfolio mainly driven by the strong performance of Dupixent® which largely offset lower sales in General Medicines partially due to pricing pressures on the Diabetes franchise in the U.S. In 2020, Pharmaceuticals sales increased 3.1% to €25,674 million driven by the strong performance of Specialty Care.

Specialty Care

Dupixent

Net sales (€ million)

Q4 2020

Change
at CER

2020

Change
at CER

Total Dupixent®

982

+54.2

%

3,534

+73.9

%

In the fourth quarter, Dupixent® (collaboration with Regeneron) sales were strong despite the COVID-19 environment and increased 54.2% to €982 million. In the U.S., Dupixent® sales of €773 million (up 52.7%) were driven by continued strong demand in atopic dermatitis (AD) in adult and adolescent patients, rapid adoption in children aged 6 to 11 years (approved in May 2020), continued uptake in asthma and chronic rhinosinusitis with nasal polyposis (CRSwNP). Dupixent® total prescriptions (TRx) increased 65% (year-over-year) and new-to-brand prescriptions (NBRx) grew 18% despite fewer in-person physician visits which remain below the pre-COVID level. In Europe, fourth-quarter Dupixent® sales grew 76.9% to €115 million reflecting continued growth in AD in key countries and additional launches in asthma in European markets. In Japan, sales were €58 million (up 30.4%), where strong demand was moderated by the government price decrease implemented in April 2020. Dupixent® was approved in China for the treatment of adults with moderate-to-severe AD in June and will be listed on the NRDL (National Reimbursement Drug List) as of March 2021. In 2020, Dupixent® sales reached €3,534 million, up 73.9% reflecting increased penetration into eligible AD and asthma populations as well as expansion in additional geographies and new indications in younger populations. At the end of 2020, Dupixent® was launched in 47 countries with approximately 230 000 patients on therapy.

Multiple Sclerosis/Neurology/Other Inflammation & Immunology

Net sales (€ million)

Q4 2020

Change
at CER

2020

Change
at CER

Aubagio®

472

+3.7

%

2,045

+10.6

%

Lemtrada®

21

-60.3

%

113

-58.7

%

Kevzara®

60

+16.7

%

236

+30.3

%

Total Multiple Sclerosis/ Neurology/Other I&I

553

-1.3

%

2,394

+3.9

%

In the fourth-quarter and full-year Multiple Sclerosis/Neurology/Other I&I sales were down 1.3% (to €553 million) impacted by the Lemtrada® sales decline. In 2020, the franchise’s sales were up 3.9% driven by Aubagio® and Kevzara® sales growth.

Aubagio® sales increased 3.7% in the fourth quarter to €472 million, driven by Europe (up 16.0%), mainly benefiting from demand growth and an earlier price increase in Germany. In the U.S., Aubagio® sales were stable reflecting lower new patient starts related to increased competition. Full-year 2020 Aubagio® sales increased 10.6% mainly driven by demand and price increases in the U.S and Germany.

Fourth-quarter and full-year Lemtrada® sales decreased 60.3% (to €21 million) and 58.7%, respectively, primarily due to the COVID-19 pandemic, which has led to a decrease in infused immune reconstitution therapies such as Lemtrada®.

Fourth-quarter and full-year Kevzara® (collaboration with Regeneron) sales were up 16.7% (to €60 million) and 30.3%, respectively, reflecting growth in Europe and Rest of the World.

Rare Disease

Net sales (€ million)

Q4 2020

Change
at CER

2020

Change
at CER

Myozyme® / Lumizyme®

235

+3.8

%

948

+6.0

%

Fabrazyme®

200

-0.9

%

817

+3.2

%

Cerezyme®

160

+0.6

%

690

+4.5

%

Aldurazyme®

57

+13.0

%

234

+8.5

%

Cerdelga®

59

+12.7

%

234

+16.0

%

Others Rare Disease

23

+4.3%

88

+4.7%

Total Rare Disease

734

+3.0

%

3,011

+5.7

%

In the fourth quarter, Rare Disease sales increased 3.0% to €734 million, primarily driven by demand partially offset by sales phasing. In 2020, Rare Disease sales increased 5.7% driven by Rest of the World.

Fourth-quarter Cerezyme® sales increased 0.6% to €160 million, driven by strong growth in Rest of the World. Fourth-quarter Cerdelga® sales increased 12.7% to €59 million driven by patient accruals in Europe. Sales of the Gaucher franchise (Cerezyme® + Cerdelga®) increased 3.4% (to €219 million) in the fourth quarter and 7.1% in 2020.

Fourth-quarter Myozyme®/Lumizyme® sales increased 3.8% to €235 million supported by new patient accruals in the U.S. In Rest of the World, sales decrease reflected COVID-19 impact on demand. Full-year 2020 Myozyme®/Lumizyme® sales increased 6.0% driven by new patient accruals in the U.S. and Rest of the World.

Fourth-quarter Fabrazyme® sales decreased 0.9% to €200 million reflecting lower sales in the Rest of the World, due to unfavorable order phasing. Fabrazyme® was launched in China in May and is the first treatment for Fabry disease approved in China. Full-year 2020 Fabrazyme® sales were up 3.2%, reflecting new patient accruals in Europe partially offset by COVID-19 impact and lower sales in Japan due to government price decrease in April 2020.

Oncology

Net sales (€ million)

Q4 2020

Change
at CER

2020

Change
at CER

Jevtana®

131

+7.0

%

536

+12.2

%

Fasturtec®

38

+2.6

%

152

+12.3

%

Libtayo®

19

+66.7

%

67

Sarclisa®

25

43

Total Oncology

213

+24.6

%

798

+27.1

%

Fourth-quarter Oncology sales increased 24.6% to €213 million, driven by Sarclisa® and Libtayo® launches and growth from established franchises. In 2020, Oncology sales were up 27.1% supported by growth in all three regions.

Fourth-quarter and full-year Jevtana® sales increased 7.0% to €131 million and 12.2%, respectively and benefited from increased demand in metastatic castration-resistant prostate cancer following publication of the results of the CARD study in this disease setting at ESMO (European Society for Medical Oncology) and in the NEJM (New England Journal of Medicine) in September 2019. In the U.S., the Jevtana® composition of matter patent will expire in September 2021. From May to July 2020, Sanofi filed patent infringement suits against all generic filers on Jevtana® under Hatch-Waxman in the U.S. District Court for the District of Delaware asserting two method of use patents (US 10,583,110 and US 10, 716,777), both of which lasts until October 2030. Sanofi has reached settlement agreements with some of the defendants and the suit against the remaining defendants are ongoing. In Europe, generic competition is expected from end of March 2021.

Libtayo® (collaboration with Regeneron) approved for the treatment of patients with metastatic cutaneous squamous cell carcinoma (CSCC) or locally advanced CSCC who are not candidates for curative surgery or curative radiation had ex-U.S. sales of €19 million in the fourth quarter and €67 million in 2020. Sales were driven by new country launches. To date, Libtayo® has been launched in 18 countries outside the U.S. Libtayo® sales in the U.S. are reported by Regeneron.

Sarclisa® was approved in March in the U.S. for the treatment of adults with relapsed refractory multiple myeloma (RRMM) who have received at least two prior therapies including lenalidomide and a proteasome inhibitor and in June by the European Commission in certain adults with RRMM. Fourth-quarter Sarclisa® sales were €25 million of which €12 million was generated in the U.S. Sarclisa® is now launched in 12 countries (including the U.S., Japan, UK, Netherlands, Canada, Sweden, Switzerland and France).

Rare Blood Disorder

Net sales (€ million)

Q4 2020

Change
at CER

2020

Change
at CER

Eloctate®

156

-6.8

%

638

-5.7

%

Alprolix®

131

+27.8

%

466

+15.0

%

Cablivi®

30

+93.8

%

113

+105.4

%

Total Rare Blood Disorder

317

+11.0

%

1,217

+7.1

%

In the fourth quarter and full-year Rare Blood Disorder franchise sales were up 11.0% (€317 million) and up 7.1%, respectively, driven by Alprolix® and Cablivi® performance which more than offset Eloctate® sales decline in the U.S. Excluding industrial sales of Alprolix® and Eloctate® to Sobi, fourth quarter and full-year Rare Blood Disorder sales grew 2.6% and 2.2%, respectively. Industrial sales to Sobi were higher than usual in the fourth quarter and full-year 2020 due to a change in the supply agreement (in 2020, sales to Sobi represented 17% and 11% of Alprolix® and Eloctate® sales, respectively). Alprolix® and Eloctate® industrial sales to Sobi are expected to be significantly lower in 2021.

Eloctate® sales were €156 million in the fourth quarter, down 6.8% due to lower U.S. sales (-10.6%) as a result of ongoing competitive pressure. Full-year Eloctate® sales decreased 5.7% driven by competitive pressure in the U.S partially offset by the Rest of the World (up 15.6%) which includes industrial sales to Sobi. Excluding industrial sales to Sobi, Eloctate® fourth quarter and full-year sales decreased 8.9% and 9.8%, respectively.

Fourth-quarter and full-year Alprolix® sales were up 27.8% (€131 million) and up 15.0%, mainly driven by patient switches from short-acting factors, prophylaxis conversion and increased industrial sales to Sobi. Full-year Alprolix® sales were up 15.0%. Excluding industrial sales to Sobi, Alprolix® fourth quarter and full-year sales each increased 6.3% and 7.4%, respectively.

Cablivi® for the treatment of adults with acquired thrombotic thrombocytopenic purpura (aTTP) generated sales of €30 million in the fourth quarter of which €18 million from the U.S. In Europe, where the product is commercially available in several countries and has a temporary license to be sold in France, sales were €12 million. Full-year 2020 Cablivi® sales were €113 million of which €72 million from the U.S. In July, the International Society on Thrombosis and Haemostasis (ISTH) published the first evidence based global guidelines on the diagnosis and treatment of thrombotic thrombocytopenic purpura (TTP) in the Journal of Thrombosis and Haemostasis. The ISTH guidelines suggest treatment with Cablivi® in combination with plasma exchange and immunosuppressive therapy for first episode or relapse in all adult aTTP patients. In addition, real world evidence from three published manuscripts from over 230 patients with confirmed aTTP in France, the United Kingdom and Germany continues to demonstrate the benefits of using Cablivi® in combination with plasma exchange and immunosuppresive therapy. This growing body of data confirms HERCULES Phase 3 results and continues to support frontline use of Cablivi® for aTTP treament.

General Medicines

Diabetes

Net sales (€ million)

Q4 2020

Change
at CER

2020

Change
at CER

Lantus®

587

(13.6

%)

2,661

(8.5

%)

Toujeo®

221

0.0

%

933

8.4

%

Total glargine

808

(10.3

%)

3,594

(4.7

%)

Apidra®

80

(1.1

%)

332

1.7

%

Admelog®

46

(10.7

%)

188

(23.2

%)

Soliqua®

46

25.6

%

161

+36.1

%

Other diabetes

107

(8.2

%)

434

(11.2

%)

Total Diabetes

1,087

(8.4

%)

4,709

(4.8

%)

In the fourth quarter, global Diabetes sales decreased 8.4% to €1,087 million, due to a continued decline in the average U.S. glargine price (Lantus® and Toujeo®), as well as some impact from the COVID-19 environment, mainly in the Rest of the World. Full-year 2020 franchise sales were down 4.8% mainly due to lower Lantus® and Admelog® sales in the U.S.and lower Amaryl® sales in China partly offset by Toujeo® and Suliqua® growth.

Lantus® sales were €587 million in the fourth quarter, down 13.6%. mainly due to a continued decline in average U.S. price, patients switching to Toujeo® and biosimilar glargine competition. In Rest of the World, sales decreased 4.1%, reflecting some COVID-19 impact on the out-of-pocket market as well as an unfavorable phasing effect. Full-year 2020 Lantus® sales decreased 8.5%, mainly due to lower sales in the U.S. and to a lesser extent in Europe, despite double-digit growth in China.

Fourth-quarter Toujeo® sales were stable at €221 million, as growth in Rest of the World and Europe offset lower sales in the U.S. In the U.S., fourth-quarter Toujeo® sales decreased 18.2% due to a continued decline in the average price which more than offset volume growth. Toujeo® was launched in China in the fourth quarter. In 2020, Toujeo® sales increased 8.4%, driven by strong performance in Rest of the World and Europe.

Fourth-quarter and full-year Amaryl® sales decreased 7.6% (€68 million) and 15.9%, respectively, due to lower sales in China reflecting the second wave of the VBP program which includes glimepiride (compound name of Amaryl®). As previously disclosed, Sanofi opted not to participate in the bidding for Amaryl®.

Fourth-quarter Soliqua®/Suliqua® sales increased 25.6% to €46 million driven by launches in Rest of the World. Full-year 2020 Soliqua® sales increased 36.1% supported by strong growth in all three regions.

Cardiovascular and Established Rx Products

Net sales (€ million)

Q4 2020

Change
at CER

2020

Change
at CER

Lovenox®

356

+13.7

%

1,351

+4.5

%

Plavix®

202

-1.4

%

916

-30.1

%

Aprovel®/Avapro®

115

-9.2

%

554

-15.9

%

Thymoglobulin®

80

-4.5

%

316

-8.2

%

Multaq®

79

-14.1

%

312

-8.4

%

Praluent®

65

-8.0

%

261

+2.3

%

Renvela®/Renagel®

44

-46.4

%

238

-23.2

%

Synvisc® /Synvisc-One®

40

-45.7

%

192

-35.6

%

Mozobil®

59

+14.5

%

214

+10.6

%

Eloxatin®

52

+26.2

%

198

-0.5

%

Taxotere®

41

-2.3

%

160

-6.3

%

Generics

219

-4.8

%

932

-2.9

%

Other

1,055

-10.6

%

4,367

-6.3

%

Total Cardiovascular and Established Rx Products

2,407

-7.1

%

10,011

-8.8

%

In the fourth quarter, Cardiovascular and Established Rx Products sales decreased 7.1% to €2,407 million, partially due to the COVID environment and divestments as well as lower Renagel®/Renvela® sales.

Fourth-quarter Lovenox® sales increased 13.7% to €356 million, driven by Rest of the World (up 17.6% to €159 million), and Europe (up 9.7% to €189 million) reflecting recent guidelines recommending the use of low molecular weight heparins in hospitalized COVID-19 patients which more than offset biosimilar competition in several European countries. Full-year 2020 Lovenox® sales were up 4.5% driven by Rest of the World sales growth which more than offset biosimilar competition in Europe.

Plavix® sales were down 1.4% in the fourth quarter to €202 million. In China, fourth-quarter Plavix® sales were €64 million, up 18.2%. Full-year 2020 Plavix® sales decreased 30.1%, mainly reflecting lower sales in China (down 52.5% to €341 million) due to net price adjustments following the implementation of the VBP program partially offset by strong volume gains.

Fourth-quarter Aprovel®/Avapro® sales were down 9.2% to €115 million, primarily reflecting lower sales in Europe. In China, fourth-quarter Aprovel®/Avapro® sales were €37 million, down 7.5%. Full-year 2020 Aprovel®/Avapro® sales decreased 15.9%, mainly reflecting lower sales in China (down 33.4% to €190 million) due to net price adjustments following the implementation of the VBP program partially offset by strong volume gains.

Full-year 2020 volume growth of Plavix® and CoAprovel® increased by 78% in China, achieving the more than 60% target.

Fourth-quarter Praluent® sales decreased 8.0% to €65 million, due to lower sales in the U.S. which more than offset performance in Europe (up 44.0% to €35 million). Praluent® was launched in China in April. Effective April 1, 2020, Sanofi has sole responsibility for Praluent® outside the U.S. while Regeneron has sole responsibility for Praluent® in the U.S. Both companies have entered into agreements to support manufacturing needs in the near term and Sanofi booked sales of Praluent® in 2020 in the U.S. In the first quarter of 2021, Sanofi will book limited Praluent® sales in the U.S. Full-year 2020 Praluent® sales grew 2.3% driven by Europe. Excluding the United States and Japan, Praluent® sales grew 13.3% in 2020.

Pharmaceuticals business operating income

In the fourth quarter, business operating income (BOI) of Pharmaceuticals increased 3.7% to €1,695 million. At CER, BOI increased 12.1%. The ratio of BOI to net sales increased by 1.9 percentage points to 26.9% reflecting lower operating expenses, specially R&D due to prioritization and resources reallocation. Full-year 2020, BOI of Pharmaceuticals increased 8.0% (12.0% at CER) to €8,833 million. The ratio of BOI to net sales increased 2.6 percentage points to 34.4%.

Vaccines

Net sales (€ million)

Q4 2020

Change
at CER

2020

Change
at CER

Influenza vaccines
(incl. Vaxigrip®, Fluzone HD®, Fluzone® & Flublok®)

1,228

+24.6

%

2,472

+37.9

%

Polio/Pertussis/Hib vaccines
(incl. Hexaxim® / Hexyon®, Pentacel®, Pentaxim® and Imovax®)

494

+20.3

%

2,106

+12.6

%

Meningitis/Pneumo vaccines
(incl. Menactra®)

125

+7.3

%

559

(15.0

%)

Adult Booster vaccines (incl. Adacel ®)

123

(11.6

%)

467

(14.9

%)

Travel and other endemic vaccines

76

(35.8

%)

301

(43.2

%)

Other vaccines

14

(46.9

%)

68

(35.5

%)

Total Vaccines

2,060

+14.6

%

5,973

+8.8

%

Fourth-quarter Vaccines sales increased 14.6% to €2,060 million reflecting the strong influenza vaccines performance in Europe and in the U.S. and higher PPH and meningitis sales partly offset by lower sales of travel vaccines and adult booster due to the COVID-19 pandemic. Full-year 2020 Vaccines sales grew 8.8% driven by influenza vaccines as well as expansion of pediatric combinations which more than compensate the negative COVID-19 impact on the other vaccine franchises.

Influenza vaccines sales increased by 24.6% in the fourth quarter to €1,228 million, reflecting strong demand in the northern hemisphere. In Europe, sales grew 118.3% to €305 million driven by increased vaccination coverage and the launch of the differentiated portfolio (Efluelda®, a quadrivalent Influenza Vaccine-High Dose and Supemtek®, a recombinant influenza vaccine). In the U.S. sales increased 10.2% to €729 million benefiting from the increased demand. Full-year 2020, influenza vaccines sales increased 37.9% to €2,472 million with more than 250 million doses shipped.Fourth-quarter Vaccines sales increased 14.6% to €2,060 million reflecting the strong influenza vaccines performance in Europe and in the U.S. and higher PPH and meningitis sales partly offset by lower sales of travel vaccines and adult booster due to the COVID-19 pandemic. Full-year 2020 Vaccines sales grew 8.8% driven by influenza vaccines as well as expansion of pediatric combinations which more than compensate the negative COVID-19 impact on the other vaccine franchises.

In the fourth quarter, Polio/Pertussis/Hib (PPH) vaccines sales increased 20.3% to €494 million driven by Rest of the world (PPH sales were up 30.6%) which benefited from expansion of Hexaxim® and favorable phasing of polio vaccine. Full-year 2020, PPH vaccines sales were up 12.6%.

Fourth-quarter Menactra® sales were up 7.3% to €125 million, driven mainly by catch up after low immunization in summer due to COVID-19. Full-year 2020 Menactra® sales decreased 15.0% to €559 million reflecting the COVID-19 impact.

Adult Booster vaccines sales decreased 11.6% in the fourth quarter to €123 million, primarily reflecting the COVID-19 impact on Adacel® in the U.S. and Repevax® in Europe. Full-year 2020 Adult Booster vaccines sales decreased 14.9% due to the COVID-19 environment.

Fourth-quarter and full-year 2020 Travel and other endemic vaccines sales decreased 35.8% and 43.2% respectively, due to extensive travel restrictions globally.

Vaccines business operating income

In the fourth quarter, business operating income (BOI) of Vaccines increased 16.2% to €825 million. At CER, BOI increased 25.1%. The ratio of BOI to net sales increased 2.8 percentage points to 40.0% versus the prior year. Full-year 2020, BOI of Vaccines increased 4.4% (up 11.2% at CER) to €2,276 million. The ratio of BOI to net sales was stable at 38.1%.

Consumer Healthcare

Net sales (€ million)

Q4 2020

Change
at CER

2020

Change
at CER

Allergy Cough & Cold

220

-16.7

%

1,096

-5.3

%

of which Allegra®

80

-3.3

%

413

+0.5%

of which Mucosolvan®

15

-35.7

%

86

-9.1

%

of which Xyzal®

14

+25.0%

70

+39.2

%

Pain

299

-2.1

%

1,225

+2.3

%

of which Doliprane®

86

-9.5

%

325

+0.3

%

of which Buscopan®

43

%

177

+8.6

%

Digestive

221

+8.5

%

858

-8.6

%

of which Dulcolax®

60

+21.2

%

235

+10.5

%

of which Enterogermina®

42

-8.0

%

180

-8.6

%

of which Essentiale®

57

+30.6

%

198

+10.5

%

of which Zantac®

ns

(7)

-109.0

%

Nutritionals

144

+1.9

%

611

+4.7

%

Other

145

-1.9

%

604

+0.5

%

of which Gold Bond®

48

-20.3

%

201

-4.2

%

Total Consumer Healthcare

1,029

-3.0

%

4,394

-1.9

%

In the fourth quarter, Consumer Healthcare (CHC) sales decreased 3.0% to €1,029 million primarily reflecting a weak cough and cold season due to social distancing measures and wearing of masks. Sales were also impacted by divestments of non-core products and product suspensions due to changing regulatory requirements. Full-year 2020 CHC sales decreased 1.9% as a result of the voluntary recall of Zantac® in October 2019, as well as divestments of non-core products and product suspensions. Excluding the Zantac® recall, full-year 2020 CHC sales were stable.

In Europe, fourth-quarter CHC and full-year 2020 CHC sales decreased 9.7% (to €318 million) and 4.3%, respectively, mainly reflecting lower demand for cough and cold products due to social distancing measures and wearing of masks, divestments of non-core products and product suspensions due to changing regulatory requirements.

In the U.S ., fourth-quarter CHC sales increased 2.4% to €238 million, reflecting growth in the Allergy (Allegra® and Xyzal®) and Digestives categories. Full-year 2020 U.S. sales decreased 1.6%, reflecting the impact of the Zantac® recall which offset the growth in the Allergy and Nutritionals categories. Excluding the impact of the Zantac® recall, full-year 2020 US sales would have increased by 5.7%.

In the Rest of the World, fourth-quarter CHC sales decreased 1.1% to €473 million, while full-year 2020 sales slightly decreased (0.4%), mostly driven by the performance of the Allergy, Cough & Cold category.

CHC business operating income

In the fourth quarter, business operating income (BOI) of CHC decreased 10.2% to €307 million. At CER, BOI increased 1.8%. The ratio of BOI to net sales increased 0.1 percentage point to 29.8% versus the prior year. Full-year 2020, BOI of CHC decreased 14.4% (down 8.1% at CER) to €1,419 million. The ratio of BOI to net sales decreased 3.0 percentage points to 32.3%.

Company sales by geographic region

Sanofi sales (€ million)

Q4 2020

Change
at CER

2020

Change
at CER

United States

3,611

+5.3

%

13,465

+8.2

%

Europe

2,534

+6.0

%

9,151

+1.5

%

Rest of the World

3,237

+1.7

%

13,425

+0.2

%

of which China

492

+9.9

%

2,454

-7.7

%

of which Japan

419

-4.8

%

1,735

-9.5

%

of which Brazil

207

+10.0%

836

+5.6

%

of which Russia

137

+4.8%

641

+6.7

%

Total Sanofi sales

9,382

+4.2

%

36,041

+3.3

%

Fourth-quarter sales in the U.S. increased 5.3% to €3,611 million driven by the strong sales performance of Dupixent® as well as Vaccines. Full-year 2020 U.S. sales increased 8.2% mainly driven by Dupixent® which more than offset lower Diabetes sales.

In Europe sales were up 6.0% in the fourth-quarter to €2,534 million. Dupixent®, influenza vaccines, Aubagio® and oncology sales growth more than offset lower sales of General Medicines and CHC. Full-year 2020 sales in Europe were up 1.5% reflecting strong sales performance of Dupixent® and influenza vaccines which more than offset lower General Medicines and CHC sales.

In the Rest of the World, sales increased 1.7% to €3,237 million in the fourth quarter driven mainly by the performance of Vaccines, Dupixent®, Lovenox® and Rare Blood Disorders franchise which more than offset lower Established Rx Products sales. Sales in China increased 9.9% to €492 million, driven by CHC and established Rx Products. In Japan, fourth-quarter sales decreased 4.8% to €419 million due to lower sales of Established Rx Products as well as CHC. In the Rest of the World, full-year 2020 sales increased 0.2%, reflecting the impact of the VBP program in China during the first nine months of the year .

R&D update at the end of the fourth quarter 2020

Regulatory update

  • The European Commission (EC) extended the marketing authorization for Dupixent® in the European Union (EU) to include children 6 to 11 years of age with severe atopic dermatitis who are candidates for systemic therapy. Dupixent is the only systemic medicine approved in the EU to treat these patients.

  • The U.S. Food and Drug Administration (FDA) issued a Complete Response Letter (CRL) regarding the BLA for sutimlimab, an investigational monoclonal antibody for the treatment of hemolysis in adults with cold agglutinin disease. The CRL refers to certain deficiencies identified by the agency during a pre-license inspection of a third-party facility responsible for manufacturing. There were no clinical or safety deficiencies noted in the CRL with respect to the application. Satisfactory resolution of the observations by the third-party manufacturer is required before the BLA can be approved and Sanofi remains in close contact with the FDA and the third-party manufacturer to reach a resolution in a timely manner.

  • The EC approved MenQuadfi® for active immunization of individuals from the age of 12 months and older against invasive meningococcal disease caused by Neisseria meningitidis serogroups A, C, W and Y, based upon results from a robust and comprehensive international clinical program, including seven pivotal Phase 2 and 3 randomized, active-controlled, multi-center studies.

  • The EC granted a marketing authorization for Supemtek®, a quadrivalent (four-strain) recombinant influenza vaccine, for the prevention of influenza in adults aged 18 years and older. This is the first and only recombinant influenza vaccine now approved in the European Union. The authorization is based on clinical data demonstrating safety, immunogenicity and efficacy of Supemtek in two Phase 3 randomized controlled trials involving more than 10,000 patients in total. Outside of the EU, Supemtek is also approved in the U.S. under the tradename Flublok Quadrivalent®.

  • The FDA accepted for priority review the supplemental Biologics License Application (sBLA) for PD-1 inhibitor Libtayo® in monotherapy, to treat patients with first line locally advanced or metastatic non-small cell lung cancer (NSCLC) with ≥50% PD-L1 expression and in patients with second line and advanced Basal Cell Carcinoma BCC. The target action date for the FDA decision is February 28, 2021 (for NSCLC) and March 3, 2021 (for BCC).

  • The National Institute for Health and Care Excellence (NICE) issued a Final Appraisal Determination (FAD) recommending Sarclisa® for in combination with existing treatment (pomalidomide and dexamethasone) for adults with relapsed/refractory multiple myeloma who have received three prior lines of treatment and at least two prior therapies including lenalidomide and a proteasome inhibitor and have demonstrated disease progression on the last treatment.

  • The FDA accepted for priority review the Biologics License Application (BLA) for avalglucosidase alfa for long-term enzyme replacement therapy for the treatment of patients with Pompe disease (acid α-glucosidase deficiency). The target action date for the FDA decision is May 18, 2021.

  • Aubagio® was granted priority review with a PDUFA date of May 2, 2021 for treating pediatric Relapsing Multiple Sclerosis.

  • Fitusiran, a potentially transformative siRNA therapy for people with hemophilia A or B, with or without inhibitors was granted Fast Track Designation by the U.S. FDA for all indications.

  • The FDA granted Fast Track Designation (FTD) to the oral investigational Bruton’s tyrosine kinase (BTK) inhibitor, rilzabrutinib, which has the potential to be the first BTK inhibitor for the treatment of immune thrombocytopenia (ITP). Rilzabrutinib received orphan drug designation from the FDA for the treatment of ITP in October 2018.

  • The European Medicines Agency’s Committee for Medicinal Products for Human Use (CHMP) has adopted a positive opinion for an additional indication for Plavix® (clopidogrel) in adult patients with high-risk transient ischemic attack (TIA) or minor ischemic stroke (IS). This new indication includes Plavix used alongside aspirin within 24 hours of an event and continued for 21 days, followed by long-term single anti-platelet therapy. The additional indication is based on the results of two double-blind, randomized, placebo-controlled investigator-initiated Phase 3 trials.

  • FDA has designated SAR442257, (CD38/CD28xCD3 tri-specific) as a Fast Track development program for the investigation in patients with multiple myeloma who have received at least 3 prior lines of therapy, and are refractory to a proteasome inhibitor, an immunomodulatory agent and an anti-CD38 monoclonal antibody.

Portfolio update

Phase 3:

  • A Phase 3 trial investigating amcenestrant with palbociclib as first line therapy for patients with ER(+) HER2(-) advanced breast cancer enrolled its first patients.

  • Three Phase 3 trials for Dupixent® started: Chronic Inducible Cold Urticaria (LIBERTY-CINDU CurIADS), Chronic Sinusitis without Nasal Polyps (CRSsNP) and Allergic Fungal Rhinosinusitis (AFRS).

  • Tolebrutinib, a brain penetrant BTK inhibitor, enrolled patients into the Phase 3 study for Primary Progressive and Secondary Progressive Multiple Sclerosis.

  • A Phase 3 study for itepekimab in Chronic Obstructive Pulmonary Disease (AERIFY-1) started.

  • Patients have now been re-started on fitusiran in the Phase 3 adolescent and adult clinical studies following a voluntary pause in Q4 2020. An amended protocol was adopted in December and will be presented later today at the European Association of Haemophilia and Allied Disorders (EAHAD) congress. These revisions are aimed at further strengthening the benefit-risk profile of fitusiran for patients.

  • The Phase 3 trial for rilzabrutinib in adults and adolescents with persistent or chronic Immune Thrompocytopenia (LUNA3) started.

Phase 2

  • Romilkimab, anti-IL4/IL13 bispecific mAb will not be pursued in systemic scleroderma.

  • Itepekimab, anti-IL-33, will not be pursued in asthma.

  • Isatuximab in combination with cemiplimab for lymphoma was discontinued.

  • The venglustat Phase 2 trial in Parkinson’s disease with GBA mutations did not meet the primary endpoint (end-January) and the indication was halted. Safety profile continues to be favorable and the development moves forward as planned in other Rare Disease indications.

Phase 1

  • Sanofi and GSK reported interim results of a Phase 1/2 clinical trial to evaluate the safety, reactogenicity (tolerability) and immunogenicity (immune response) of a COVID-19 vaccine candidate. These results demonstrated an insufficient response in older adults and need to refine the concentration of antigen in order to provide high-level immune response across all age groups. The companies plan a Phase 2b study with an improved antigen formulation which with support from BARDA is expected to start this month.

  • SAR444245 (THOR707), a non-alpha IL-2, added a cohort in combination with pembrolizumab in solid tumors.

  • SAR443820, a RIPK1 inhibitor, being developed for Amyotrophic Lateral Sclerosis (ALS) transitioned to the clinic and started a Phase 1 safety and tolerability study.

  • SAR442501, (FGFR3 antibody) being developed for Achondroplasia, transitioned to the clinic and started a Phase 1 safety and tolerability study.

An update of the R&D pipeline at as of December 31, 2020, is available on our website:

https://www.sanofi.com/en/science-and-innovation/research-and-development

Sustainable performance update

Sanofi became the first large biopharmaceutical company to integrate environmental and social features in two sustainability-linked credit facilities. The interest rate is linked to two sustainability key performance indicators (KPIs) and achieving the set sustainability targets leads to a lower interest rate.

The two facilities include a new €4 billion revolving credit facility expiring December 2025, with two extension options of one year each, and an amendment of the €4 billion revolving credit facility expiring in December 2021 with the addition of two extension options of one year each.

The cost of the facilities is linked to the achievement of annual targets for two sustainable KPIs, contribution to Polio eradication and carbon footprint reduction. The innovative character of the transaction lies on Sanofi’s commitment to invest yearly a fixed contribution to both Sanofi’s Espoir Foundation and Sanofi Planet Mobilization program to fund social and environmentally responsible projects and maximize its impact on the two objectives. In case Sanofi achieves its yearly sustainability performance targets, Sanofi’s lending banks will support this contribution through a discount on the margin.

2020 fourth-quarter and full-year financial results2

Business Net Income2

In the fourth quarter of 2020, Sanofi generated net sales of €9,382 million, a decrease of 2.4% and an increase of 4.2% at CER. In 2020, Sanofi sales were €36,041 million, a decrease of 0.2% and an increase of 3.3% at CER.

Fourth-quarter other revenues decreased 13.4% (down 7.1% at CER) to €354 million, reflecting lower VaxServe sales of non-Sanofi products (€308 million, down 7.5% at CER). In 2020, other revenues decreased 11.8% (down 9.5% at CER) to €1,328 million, including lower VaxServe sales of non-Sanofi products (€1,136 million, down 8.4% at CER).

Fourth-quarter Gross Profit decreased 4.0% to €6,298 million (up 2.5% at CER). The gross margin ratio decreased 1.2 percentage points to 67.1% (67.1% at CER) versus the prior year. This decrease reflected the erosion of the Pharmaceuticals gross margin ratio (from 72.5% to 70.7%). The margin accretion from Specialty Care was more than offset by the lower gross margin ratio from General Medicines, reflecting increased net price adjustments for U.S. Diabetes, and evolution of product mix. Vaccines gross margin ratio improved 0.2 percentage point to 60.5%. CHC gross margin ratio decreased from 65.8% to 64.6%. In 2020, the gross margin ratio decreased 0.9 percentage point to 70.1% (69.9% at CER) versus 2019, reflecting the lower gross margin ratio in Pharmaceuticals.

Research and Development (R&D) expenses decreased 10.1% to €1,516 million in the fourth quarter. At CER, R&D expenses decreased 6.8% reflecting reallocation of resources towards priority assets which did not fully offset significant diabetes development costs in the fourth quarter of 2019. The ratio of R&D to sales decreased 1.3 percentage points to 16.2% compared to the prior year. Full-year 2020 R&D expenses decreased 8.1% to €5,529 million (down 6.8% at CER) reflecting reprioritization of resources not fully offsetting the decline in diabetes development expenses. In 2020, the ratio of R&D to sales decreased 1.4 percentage points to 15.3% compared to 2019.

Fourth-quarter selling general and administrative expenses (SG&A) decreased 5.0% to €2,601 million. At CER, SG&A expenses were up 0.3%, reflecting increased investments in Specialty Care and Vaccines which offset smart spending and operational excellence initiatives. In the fourth quarter, the ratio of SG&A to sales decreased 0.8 percentage point to 27.7% compared to the prior year. Full-year 2020 SG&A expenses decreased 5.0% to €9,390 million (down 2.4% at CER). In 2020, the ratio of SG&A to sales was 1.3 percentage points lower at 26.1% compared to 2019.

Fourth-quarter operating expenses were €4,117 million, a decrease of 6.9% and 2.4% at CER. Full-year 2020 operating expenses were €14,919 million, a decrease of 6.2% and 4.0% at CER.

Fourth-quarter other current operating income net of expenses was -€125 million versus -€70 million in the prior year. This line included an expense of €289 million (versus a €241 million expense in the fourth quarter of 2019) corresponding to the share of profit to Regeneron of the monoclonal antibodies Alliance, reimbursement of development costs by Regeneron and the reimbursement of commercialization-related expenses incurred by Regeneron. In 2020, other current operating income net of expenses was -€562 million versus -€382 million in 2019 and included a gain of €157 million related to a revaluation of retained Regeneron shares in the second quarter. The full-year 2020 expense associated with the monoclonal antibodies Alliance with Regeneron was €1,001 million, which compared with an expense of €681 million in 2019 (see appendix 7 for further details).

The share of profit from associates was €4 million in the fourth quarter versus a loss of €13 million in the prior year. Following the sale of its Regeneron stake at the end of May 2020, Sanofi restated its previously reported non-GAAP indicator (Business Net Income) and excluded the effect of equity method of accounting for Regeneron investment in 2019, Q1 2020 and Q2 2020. In 2020, the share of profits from associates was €16 million (versus €9 million in 2019).

Fourth-quarter business operating income2 (BOI) increased 0.3% to €2,052 million. At CER, BOI increased 9.9% reflecting the operational leverage driven by smart spending and operational excellence initiatives as well as R&D prioritization. The ratio of BOI to net sales increased 0.6 percentage points to 21.9% versus the prior year. In 2020, BOI was €9,762 million, up 4.4% (up 9.7% at CER) and included €1,680 million of saving initiatives (including around €230 million of savings related to COVID-19). In 2020, operational excellence and deprioritized businesses generated savings of €564 million and €500 million, respectively while smart spending initiatives realized €616 million. In 2020, the ratio of BOI to net sales increased 1.2 percentage points to 27.1% (27.5% at CER), driven by Pharmaceuticals.

Net financial expenses were €94 million in the fourth quarter versus €73 million in the same period of 2019. Full-year 2020 net financial expenses were €337 million versus €303 million in 2019.

Fourth-quarter and full-year 2020 effective tax rate was stable at 22.0% versus the prior period. Sanofi expects its effective tax rate to be around 21% in 2021, everything being equal in the U.S.

Fourth-quarter business net income2 decreased 0.5% to €1,527 million and increased 9.4% at CER. The ratio of business net income to net sales increased 0.3 percentage points to 16.3% (16.8% at CER) versus the fourth quarter of 2019. In 2020, business net income2 increased 4.2% to €7,347 million and increased 9.6% at CER. The ratio of business net income to net sales increased 0.9 percentage point to 20.4% (20.7% at CER) versus 2019.

In the fourth quarter of 2020, business earnings per share2 (EPS) was stable at €1.22 on a reported basis and increased 9.8% at CER. The average number of shares outstanding was 1,255.1 million versus 1,253.1 million in fourth quarter 2019. Full-year 2020, business earnings per share2 was €5.86, up 3.9% on a reported basis and up 9.2% at CER. The average number of shares outstanding was 1,253.6 million in 2020 versus 1,249.9 million in 2019.

2 See Appendix 3 for 2020 fourth-quarter consolidated income statement; see Appendix 9 for definitions of financial indicators, and Appendix 4 for reconciliation of IFRS net income reported to business net income.

Reconciliation of IFRS net income reported to business net income (see Appendix 4)

In 2020, the IFRS net income was €12,314 million. The main items excluded from the business net income were:

  • An amortization charge of €1,681 million related to fair value remeasurement on intangible assets of acquired companies (primarily Genzyme: €549 million, Bioverativ: €331 million, Boehringer Ingelheim CHC business: €202 million, Ablynx: €168 million, Aventis: €104 million) and to acquired intangible assets (licenses/products: €89 million). These items have no cash impact on the Company.

  • An impairment of intangible assets of €330 million related to several projects including Diabetes.

  • Restructuring costs and similar items of €1,064 million is mainly related to streamlining initiatives in Europe.

  • A pre-tax gain of €136 million mainly arising from the divestment of Seprafilm to Baxter.

  • A gain of €7,225 million related to the sale of the majority of Sanofi’s Regeneron shares completed on May 29.

  • A €264 million tax effect arising from the items listed above, mainly comprising €541 million of deferred taxes generated by amortization and impairments of intangible assets and €293 million associated with restructuring costs and similar items and -€477 million of tax related to the sale of Regeneron shares (see Appendix 4).

  • €313 million corresponding to the share of income related to equity accounting from Regeneron until May 29, 2020. Sanofi non-GAAP indicator (Business net income) does not include the share of income related to equity accounting since it ceased to be an associate on May 29, 2020.

Capital Allocation

In 2020, free cash flow3 increased by 16.1% to €6,982 million, after net changes in working capital (-€35 million), capital expenditures (-€1,329 million) and other asset acquisitions4 (-€562 million), proceeds from disposals4 (€930 million), and payments related to restructuring and similar items (-€910 million). Over the period, acquisitions5 were -€5,786 million (-€3,029 million related to Principia and -€2,245 million related to Synthorx) and proceeds from disposals5 net of tax were €10,370 million (sale of Regeneron shares). As a consequence, net debt decreased from €15,107 million at December 31, 2019, to €8,789 million at December 31, 2020 (amount net of €13,915 million cash and cash equivalents).

-----------
Financial statements are not audited. The audit procedures by the Statutory Auditors are underway.

-----------
Forward-Looking Statements

This press release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements are statements that are not historical facts. These statements include projections and estimates and their underlying assumptions, statements regarding plans, objectives, intentions and expectations with respect to future financial results, events, operations, services, product development and potential, and statements regarding future performance. Forward-looking statements are generally identified by the words “expects”, “anticipates”, “believes”, “intends”, “estimates”, “plans” and similar expressions. Although Sanofi’s management believes that the expectations reflected in such forward-looking statements are reasonable, investors are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of Sanofi, that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. These risks and uncertainties include among other things, the uncertainties inherent in research and development, future clinical data and analysis, including post marketing, decisions by regulatory authorities, such as the FDA or the EMA, regarding whether and when to approve any drug, device or biological application that may be filed for any such product candidates as well as their decisions regarding labelling and other matters that could affect the availability or commercial potential of such product candidates, the fact that product candidates if approved may not be commercially successful, the future approval and commercial success of therapeutic alternatives, Sanofi’s ability to benefit from external growth opportunities, to complete related transactions and/or obtain regulatory clearances, risks associated with intellectual property and any related pending or future litigation and the ultimate outcome of such litigation, trends in exchange rates and prevailing interest rates, volatile economic and market conditions, cost containment initiatives and subsequent changes thereto, and the impact that COVID-19 will have on us, our customers, suppliers, vendors, and other business partners, and the financial condition of any one of them, as well as on our employees and on the global economy as a whole. Any material effect of COVID-19 on any of the foregoing could also adversely impact us. This situation is changing rapidly and additional impacts may arise of which we are not currently aware and may exacerbate other previously identified risks. The risks and uncertainties also include the uncertainties discussed or identified in the public filings with the SEC and the AMF made by Sanofi, including those listed under “Risk Factors” and “Cautionary Statement Regarding Forward-Looking Statements” in Sanofi’s annual report on Form 20-F for the year ended December 31, 2019. Other than as required by applicable law, Sanofi does not undertake any obligation to update or revise any forward-looking information or statements.

3 non-GAAP financial measure (definition in Appendix 9).
4 Not exceeding €500 million per transaction (inclusive of all payments related to the transaction).
5 Amount of the transaction above €500 million per transaction (inclusive of all payments related to the transaction).

Appendices

List of appendices

Appendix 1:

2020 fourth-quarter and full-year 2020 net sales by GBU, franchise, geographic region and product

Appendix 2:

2020 fourth-quarter and full-year 2020 business net income statement

Appendix 3:

2020 fourth-quarter and full-year 2020 consolidated income statement

Appendix 4:

Reconciliation of IFRS net income reported to business net income

Appendix 5:

Change in net debt

Appendix 6:

Simplified consolidated balance sheet

Appendix 7:

Other current operating income net of expenses – Regeneron Alliances

Appendix 8:

Currency sensitivity

Appendix 9:

Definitions of non-GAAP financial indicators


Investor Relations: (+) 33 1 53 77 45 45 - E-mail: IR@sanofi.com - Media Relations: (+) 33 1 53 77 46 46 - E-mail: MR@sanofi.com
Website: www.sanofi.com

Appendix 1: 2020 fourth-quarter net sales by GBU, franchise, geographic region and product

Q4 2020 (€ million)

Total Sales

% CER

% reported

United States

% CER

Europe

% CER

Rest of the world

% CER

Dupixent

982

54.2

%

44.6

%

773

52.7

%

115

76.9

%

94

44.9

%

Aubagio

472

3.7

%

-2.1

%

318

0.0

%

122

16.0

%

32

3.0

%

Lemtrada

21

-60.3

%

-63.8

%

11

-61.8

%

5

-62.5

%

5

-50.0

%

Kevzara

60

16.7

%

11.1

%

31

-2.9

%

20

42.9

%

9

66.7

%

MS/Neurology/Other I&I

553

-1.3

%

-6.9

%

360

-5.4

%

147

9.6

%

46

2.1

%

Cerezyme

160

0.6

%

-9.6

%

44

-4.0

%

62

-6.0

%

54

11.7

%

Cerdelga

59

12.7

%

7.3

%

31

6.5

%

24

20.0

%

4

25.0

%

Myozyme

235

3.8

%

-1.3

%

90

11.4

%

98

2.1

%

47

-5.7

%

Fabrazyme

200

-0.9

%

-7.0

%

98

0.0

%

51

8.3

%

51

-9.8

%

Aldurazyme

57

13.0

%

5.6

%

13

7.7

%

21

0.0

%

23

30.0

%

Rare Disease

734

3.0

%

-3.7

%

276

3.8

%

256

2.4

%

202

2.7

%

Jevtana

131

7.0

%

2.3

%

60

3.3

%

47

17.1

%

24

0.0

%

Fasturtec

38

2.6

%

-2.6

%

23

-3.8

%

11

10.0

%

4

33.3

%

Libtayo

19

66.7

%

58.3

%

0

18

50.0

%

1

0.0

%

Sarclisa

25

12

7

6

Oncology

213

24.6

%

19.0

%

95

14.9

%

83

33.3

%

35

34.5

%

Alprolix

131

27.8

%

21.3

%

79

10.4

%

0

52

71.0

%

Eloctate

156

-6.8

%

-11.9

%

103

-10.6

%

0

53

1.9

%

Cablivi

30

93.8

%

87.5

%

18

100.0

%

12

71.4

%

0

Rare Blood Disorder

317

11.0

%

5.3

%

200

2.4

%

12

71.4

%

105

27.4

%

Specialty Care

2,799

18.3

%

11.3

%

1,704

19.1

%

613

18.1

%

482

15.8

%

Lantus

587

-13.6

%

-19.5

%

202

-23.8

%

130

-12.7

%

255

-4.1

%

Toujeo

221

0.0

%

-5.6

%

58

-18.2

%

96

7.8

%

67

10.4

%

Apidra

80

-1.1

%

-9.1

%

9

0.0

%

32

-2.9

%

39

0.0

%

Soliqua/iGlarLixi

46

25.6

%

17.9

%

29

10.7

%

7

40.0

%

10

83.3

%

Diabetes

1,087

-8.4

%

-14.3

%

339

-19.6

%

303

-2.8

%

445

-1.6

%

Plavix

202

-1.4

%

-4.7

%

3

33

-5.7

%

166

-2.3

%

Lovenox

356

13.7

%

6.3

%

8

28.6

%

189

9.7

%

159

17.6

%

Renagel / Renvela

44

-46.4

%

-47.6

%

3

-88.6

%

11

-21.4

%

30

-14.3

%

Aprovel

115

-9.2

%

-12.2

%

3

-50.0

%

24

-22.6

%

88

-2.1

%

Synvisc / Synvysc one

40

-45.7

%

-50.6

%

25

-53.4

%

6

0.0

%

9

-35.3

%

Mozobil

59

14.5

%

7.3

%

33

6.1

%

15

15.4

%

11

44.4

%

Thymoglobulin

80

-4.5

%

-10.1

%

51

1.9

%

7

-30.0

%

22

-8.0

%

Taxotere

41

-2.3

%

-4.7

%

0

0.0

%

-100.0

%

41

0.0

%

Eloxatine

52

26.2

%

23.8

%

0

-100.0

%

1

0.0

%

51

18.2

%

Praluent

65

-8.0

%

-13.3

%

24

-30.8

%

35

44.0

%

6

-45.5

%

Multaq

79

-14.1

%

-20.2

%

69

-14.0

%

6

-45.5

%

4

150.0

%

Generics

219

-4.8

%

-19.2

%

44

29.7

%

22

-45.2

%

153

-2.6

%

Others

1,055

-10.6

%

-15.4

%

59

-28.2

%

522

-6.7

%

474

-11.7

%

Cardiovascular & Established Rx Products

2,407

-7.1

%

-12.9

%

322

-21.0

%

871

-5.1

%

1,214

-4.1

%

General Medicines

3,494

-7.5

%

-13.3

%

661

-20.3

%

1,174

-4.5

%

1,659

-3.4

%

Pharmaceuticals

6,293

2.4

%

-3.9

%

2,365

4.6

%

1,787

2.2

%

2,141

0.3

%

Polio / Pertussis / Hib

494

20.3

%

11.5

%

112

10.0

%

80

2.5

%

302

30.6

%

Adult Booster Vaccines

123

-11.6

%

-16.3

%

59

-14.9

%

37

-5.1

%

27

-11.8

%

Meningitis / Pneumonia

125

7.3

%

0.8

%

81

50.9

%

0

-100.0

%

44

-28.8

%

Influenza Vaccines

1,228

24.6

%

18.2

%

729

10.2

%

305

118.3

%

194

8.3

%

Travel and Other Endemic Vaccines

76

-35.8

%

-38.2

%

13

-50.0

%

5

-83.3

%

58

-7.7

%

Vaccines

2,060

14.6

%

8.0

%

1,008

7.7

%

429

48.3

%

623

9.8

%

Allergy, Cough and Cold

220

-16.7

%

-22.0

%

66

12.5

%

59

-32.2

%

95

-20.6

%

Pain

299

-2.1

%

-11.0

%

40

-8.5

%

139

-4.1

%

120

2.1

%

Digestive

221

8.5

%

-0.9

%

24

23.8

%

76

0.0

%

121

11.4

%

Nutritional

144

1.9

%

-6.5

%

9

11.1

%

32

0.0

%

103

1.8

%

Consumer Healthcare

1,029

-3.0

%

-10.8

%

238

2.4

%

318

-9.7

%

473

-1.1

%

Company

9,382

4.2

%

-2.4

%

3,611

5.3

%

2,534

6.0

%

3,237

1.7

%

Full-year 2020 net sales by GBU, franchise, geographic region and product

Full Year 2020 (€ million)

Total Sales

% CER

% reported

United States

% CER

Europe

% CER

Rest of the world

% CER

Dupixent

3,534

73.9

%

70.4

%

2,808

72.1

%

386

89.2

%

340

73.1

%

Aubagio

2,045

10.6

%

8.8

%

1,448

9.0

%

473

14.7

%

124

15.8

%

Lemtrada

113

-58.7

%

-59.8

%

60

-59.6

%

30

-68.4

%

23

-28.6

%

Kevzara

236

30.3

%

27.6

%

123

8.7

%

75

70.5

%

38

57.7

%

MS/Neurology/Other I&I

2,394

3.9

%

2.1

%

1,631

2.5

%

578

4.9

%

185

13.1

%

Cerezyme

690

4.5

%

-2.5

%

177

-1.6

%

249

-3.5

%

264

16.6

%

Cerdelga

234

16.0

%

13.6

%

128

10.2

%

92

22.7

%

14

30.8

%

Myozyme

948

6.0

%

3.3

%

359

10.9

%

389

0.5

%

200

8.5

%

Fabrazyme

817

3.2

%

0.5

%

406

1.0

%

200

8.6

%

211

2.8

%

Aldurazyme

234

8.5

%

4.5

%

52

3.9

%

80

1.3

%

102

17.0

%

Rare Disease

3,011

5.7

%

1.9

%

1,122

4.7

%

1,010

2.7

%

879

10.4

%

Jevtana

536

12.2

10.7

%

246

17.9

%

187

10.6

%

103

2.9

%

Fasturtec

152

12.3

%

10.1

%

96

10.1

%

42

10.5

%

14

36.4

%

Libtayo

67

331.3

%

318.8

%

0

61

306.7

%

6

700.0

%

Sarclisa

43

26

9

8

Oncology

798

27.1

%

25.1

%

368

24.6

%

299

34.5

%

131

19.3

%

Alprolix

466

15.0

%

13.1

%

320

8.7

%

0

146

32.1

%

Eloctate

638

-5.7

%

-6.7

%

445

-12.6

%

0

193

15.6

%

Cablivi

113

105.4

%

101.8

%

72

117.6

%

41

86.4

%

0

Rare Blood Disorder

1,217

7.1

%

5.6

%

837

0.1

%

41

86.4

%

339

22.2

%

Specialty Care

10,954

22.4

%

19.5

%

6,766

24.8

%

2,314

16.7

%

1,874

21.0

%

Lantus

2,661

-8.5

%

-11.7

%

929

-17.7

%

537

-9.8

%

1,195

0.5

%

Toujeo

933

8.4

%

5.7

%

267

-5.9

%

374

9.6

%

292

23.1

%

Apidra

332

1.7

%

-3.5

%

32

-28.3

%

131

-1.5

%

169

12.8

%

Soliqua/iGlarLixi

161

36.1

%

32.0

%

100

17.2

%

24

38.9

%

37

129.4

%

Diabetes

4,709

-4.8

%

-7.9

%

1,501

-15.6

%

1,206

-2.4

%

2,002

3.2

%

Plavix

916

-30.1

%

-31.3

%

10

129

-9.2

%

777

-33.5

%

Lovenox

1,351

4.5

%

-0.6

%

30

-6.1

%

656

-9.3

%

665

22.0

%

Renagel / Renvela

238

-23.2

%

-24.2

%

64

-51.9

%

46

-16.4

%

128

4.0

%

Aprovel

554

-15.9

%

-17.8

%

22

-15.4

%

100

-11.5

%

432

-16.8

%

Synvisc / Synvysc one

192

-35.6

%

-37.9

%

131

-37.0

%

20

-23.1

%

41

-36.1

%

Mozobil

214

10.6

%

8.1

%

123

9.6

%

55

7.8

%

36

18.8

%

Thymoglobulin

316

-8.2

%

-10.7

%

191

-1.0

%

29

-21.6

%

96

-16.0

%

Taxotere

160

-6.3

%

-8.0

%

0

-100.0

%

2

-50.0

%

158

-5.8

%

Eloxatine

198

-0.5

%

-2.5

%

1

-116.7

%

2

0.0

%

195

-3.9

%

Praluent

261

2.3

%

1.2

%

106

-4.5

%

121

8.9

%

34

2.9

%

Multaq

312

-8.4

%

-10.1

%

274

-5.1

%

24

-41.5

%

14

27.3

%

Generics

932

-2.9

%

-13.2

%

161

8.6

%

100

-27.3

%

671

-0.8

%

Others

4,367

-6.3

%

-9.5

%

255

-15.3

%

2,015

-3.8

%

2,097

-7.4

%

Cardiovascular & Established Rx Products

10,011

-8.8

%

-12.4

%

1,368

-11.4

%

3,299

-6.7

%

5,344

-9.4

%

General Medicines

14,720

-7.6

%

-11.0

%

2,869

-13.6

%

4,505

-5.6

%

7,346

-6.3

%

Pharmaceuticals

25,674

3.1

%

-0.1

%

9,635

10.2

%

6,819

0.9

%

9,220

-1.8

%

Polio / Pertussis / Hib

2,106

12.6

%

8.2

%

412

11.3

%

331

6.3

%

1,363

14.6

%

Adult Booster Vaccines

467

-14.9

%

-17.1

%

247

-20.3

%

150

-10.7

%

70

-1.3

%

Meningitis / Pneumonia

559

-15.0

%

-18.0

%

392

-20.3

%

1

-50.0

%

166

1.2

%

Influenza Vaccines

2,472

37.9

%

30.7

%

1,575

29.9

%

441

93.9

%

456

30.6

%

Travel and Other Endemic Vaccines

301

-43.2

%

-44.2

%

73

-48.3

%

47

-64.4

%

181

-29.9

%

Vaccines

5,973

8.8

%

4.2

%

2,759

5.9

%

973

15.4

%

2,241

9.9

%

Allergy, Cough and Cold

1,096

-5.3

%

-7.8

%

361

13.0

%

305

-15.9

%

430

-9.4

%

Pain

1,225

2.3

%

-4.3

%

181

-0.5

%

539

0.0

%

505

5.4

%

Digestive

858

-8.6

%

-12.9

%

86

-43.9

%

319

-0.9

%

453

-2.6

%

Nutritional

611

4.7

%

-1.6

%

43

15.8

%

127

-0.8

%

441

5.3

%

Consumer Healthcare

4,394

-1.9

%

-6.4

%

1,071

-1.6

%

1,359

-4.3

%

1,964

-0.4

%

Company

36,041

3.3

%

-0.2

%

13,465

8.2

%

9,151

1.5

%

13,425

0.2

%

Appendix 2: Business net income statement

Fourth Quarter 2020

Pharmaceuticals

Consumer Healthcare

Vaccines

Others(2)

Total Group

€ million

Q4 2020

Q4 2019(1)

Change

Q4 2020

Q4 2019(1)

Change

Q4 2020

Q4 2019(1)

Change

Q4 2020

Q4 2019(1)

Change

Q4 2020

Q4 2019(1)

Change

Net sales

6,293

6,547

-3.9%

1,029

1,153

-10.8%

2,060

1,908

8.0%

—%

9,382

9,608

-2.4%

Other revenues

30

36

-16.7%

16

15

6.7%

308

358

-14.0%

—%

354

409

-13.4%

Cost of Sales

(1,872)

(1,839)

1.8%

(380)

(409)

-7.1%

(1,122)

(1,116)

0.5%

(64)

(93)

-31.2%

(3,438)

(3,457)

-0.5%

As % of net sales

(29.7)%

(28.1)%

(36.9)%

(35.5)%

(54.5)%

(58.5)%

(36.6)%

(36.0)%

Gross Profit

4,451

4,744

-6.2%

665

759

-12.4%

1,246

1,150

8.3%

(64)

(93)

-31.2%

6,298

6,560

-4.0%

As % of net sales

70.7%

72.5%

64.6%

65.8%

60.5%

60.3%

67.1%

68.3%

Research and development expenses

(1,169)

(1,352)

-13.5%

(42)

(45)

-6.7%

(187)

(192)

-2.6%

(118)

(97)

21.6%

(1,516)

(1,686)

-10.1%

As % of net sales

(18.6)%

(20.7)%

(4.1)%

(3.9)%

(9.1)%

(10.1)%

(16.2)%

(17.5)%

Selling and general expenses

(1,432)

(1,511)

-5.2%

(353)

(410)

-13.9%

(235)

(251)

-6.4%

(581)

(565)

2.8%

(2,601)

(2,737)

-5.0%

As % of net sales

(22.8)%

(23.1)%

(34.3)%

(35.6)%

(11.4)%

(13.2)%

(27.7)%

(28.5)%

Other current operating income/expenses

(149)

(241)

35

53

1

3

(12)

115

(125)

(70)

Share of profit/loss of associates* and joint ventures (3)

2

1

2

(14)

4

(13)

Net income attributable to non controlling interests

(8)

(7)

(1)

(8)

(8)

Business operating income

1,695

1,634

3.7%

307

342

-10.2%

825

710

16.2%

(775)

(640)

21.1%

2,052

2,046

0.3%

As % of net sales

26.9%

25.0%

29.8%

29.7%

40.0%

37.2%

21.9%

21.3%

Financial income and expenses

(94)

(73)

Income tax expenses

(431)

(439)

Tax rate**

22.0%

22.0%

Business net income

1,527

1,534

-0.5%

As % of net sales

16.3%

16.0%

Business earnings / share(in euros)***

1.22

1.22

—%

* Net of tax.

** Determined based on Business income before tax, associates, and non-controlling interests.

*** Based on an average number of shares outstanding of 1,255.1 million in the fourth quarter of 2020 and 1,253.1 million in the fourth quarter of 2019.

(1) In 2019, change of presentation according to the Company new management reporting basis for 2020 and including the Impact of lease standard IFRS 16, effective January 1, 2019, in order to be reported under IFRS 16 and its related interpretations for comparison purposes.

(2) Other includes the cost of global support functions (Finance, Human Resources, Information Solution & Technologies, Sanofi Business Services, etc.…).

(3) The line "Share of profits/loss of associates and joint-ventures " has been restated in 2019 to exclude any effect of equity method accounting for Regeneron investment as a consequence of the sale of the entire equity investment in Regeneron (with the exception of 400,000 shares retained by Sanofi) on May 29th 2020.

Full-year 2020

Pharmaceuticals

Consumer Healthcare

Vaccines

Others(2)

Total Group

€ million

2020

2019(1)

Change

2020

2019(1)

Change

2020

2019(1)

Change

2020

2019(1)

Change

2020

2019(1)

Change

Net sales

25,674

25,700

-0.1%

4,394

4,695

-6.4%

5,973

5,731

4.2%

—%

36,041

36,126

-0.2%

Other revenues

128

173

-26.0%

59

57

3.5%

1,141

1,275

-10.5%

—%

1,328

1,505

-11.8%

Cost of Sales

(7,025)

(6,750)

4.1%

(1,506)

(1,599)

-5.8%

(3,328)

(3,372)

-1.3%

(245)

(252)

-2.8%

(12,104)

(11,973)

1.1%

As % of net sales

(27.4)%

(26.3)%

(34.3)%

(34.1)%

(55.7)%

(58.8)%

(33.6)%

(33.1)%

Gross Profit

18,777

19,123

-1.8%

2,947

3,153

-6.5%

3,786

3,634

4.2%

(245)

(252)

-2.8%

25,265

25,658

-1.5%

As % of net sales

73.1%

74.4%

67.1%

67.2%

63.4%

63.4%

70.1%

71.0%

Research and development expenses

(4,331)

(4,850)

-10.7%

(136)

(149)

-8.7%

(692)

(639)

8.3%

(370)

(380)

-2.6%

(5,529)

(6,018)

-8.1%

As % of net sales

(16.9)%

(18.9)%

(3.1)%

(3.2)%

(11.6)%

(11.1)%

(15.3)%

(16.7)%

Selling and general expenses

(5,097)

(5,442)

-6.3%

(1,450)

(1,529)

-5.2%

(822)

(823)

-0.1%

(2,021)

(2,089)

-3.3%

(9,390)

(9,883)

-5.0%

As % of net sales

(19.9)%

(21.2)%

(33.0)%

(32.6)%

(13.8)%

(14.4)%

(26.1)%

(27.4)%

Other current operating income/expenses

(488)

(625)

54

193

2

(130)

50

(562)

(382)

Share of profit/loss of associates* and joint ventures (3)

5

5

9

(5)

2

9

16

9

Net income attributable to non controlling interests

(33)

(29)

(5)

(6)

(38)

(35)

Business operating income

8,833

8,182

8.0%

1,419

1,657

-14.4%

2,276

2,181

4.4%

(2,766)

(2,671)

3.6%

9,762

9,349

4.4%

As % of net sales

34.4%

31.8%

32.3%

35.3%

38.1%

38.1%

27.1%

25.9%

Financial income and expenses

(337)

(303)

Income tax expenses

(2,078)

(1,996)

Tax rate**

22.0%

22.0%

Business net income

7,347

7,050

4.2%

As % of net sales

20.4%

19.5%

Business earnings / share(in euros)***

5.86

5.64

3.9%

* Net of tax.

** Determined based on Business income before tax, associates, and non-controlling interests.

*** Based on an average number of shares outstanding of 1,253,6 million in full year 2020 and 1,249.9 million in full year 2019.

(1) In 2019, change of presentation according to the Company new management reporting basis for 2020 and including the Impact of lease standard IFRS 16, effective January 1, 2019, in order to be reported under IFRS 16 and its related interpretations for comparison purposes.

(2) Other includes the cost of global support functions (Finance, Human Resources, Information Solution & Technologies, Sanofi Business Services, etc.…).

(3) The line "Share of profits/loss of associates and joint-ventures " has been restated in 2019 to exclude any effect of equity method accounting for Regeneron investment as a consequence of the sale of the entire equity investment in Regeneron (with the exception of 400,000 shares retained by Sanofi) on May 29th 2020.

Appendix 3: Consolidated income statements

€ million

Q4 2020

Q4 2019

2020

2019

Net sales

9,382

9,608

36,041

36,126

Other revenues

354

409

1,328

1,505

Cost of sales

(3,438)

(3,457)

(12,157)

(11,976)

Gross profit

6,298

6,560

25,212

25,655

Research and development expenses

(1,516)

(1,686)

(5,529)

(6,018)

Selling and general expenses

(2,601)

(2,737)

(9,390)

(9,883)

Other operating income

173

429

696

825

Other operating expenses

(298)

(499)

(1,415)

(1,207)

Amortization of intangible assets

(394)

(510)

(1,681)

(2,146)

Impairment of intangible assets (1)

(5)

(1,581)

(330)

(3,604)

Fair value remeasurement of contingent consideration

48

(4)

124

238

Restructuring costs and similar items

(196)

(158)

(1,064)

(1,062)

Other gains and losses, and litigation (2)

67

136

327

Gain on Regeneron investment as result of transaction completed on May 29th, 2020 (3)

7,382

Operating income

1,509

(119)

14,141

3,125

Financial expenses

(101)

(91)

(390)

(444)

Financial income

7

18

53

141

Income before tax and associates and joint ventures

1,415

(192)

13,804

2,822

Income tax expense

(329)

142

(1,813)

(139)

Share of profit/(loss) of associates and joint ventures

4

48

359

255

Net income excluding the exchanged/held-for-exchange Animal Health business

1,090

(2)

12,350

2,938

Net income/(loss) of the exchanged/held-for-exchange Animal Health business

(1)

(101)

Net income

1,090

(3)

12,350

2,837

Net income attributable to non-controlling interests

9

7

36

31

Net income attributable to equity holders of Sanofi

1,081

(10)

12,314

2,806

Average number of shares outstanding (million)

1,255.1

1,253.1

1,253.6

1,249.9

IFRS Earnings per share (in euros)

0.86

(0.01)

9.82

2.24

(1) In 2019, mainly related to Eloctate Impairment.

(2) In 2020, includes mainly the gain on the sale of operations related to the Seprafilm product to Baxter. In 2019, net gain of € 317 million related to litigation.

(3) This line includes the pre-tax income from the sale of Regeneron shares following the public offer for sale and Regeneron's repurchase on May 29, 2020. This amount includes the gain related to the remeasurement at fair value of the 400,000 retained shares that could be used to finance the R&D collaboration under the letter of agreement dated 2018.

Appendix 4: Reconciliation of Net income attributable to equity holders of Sanofi to Business net income

€ million

Q4 2020

Q4 2019 (1)

2020

2019 (1)

Net income attributable to equity holders of Sanofi

1,081

(10)

12,314

2,806

Amortization of intangible assets (2)

394

510

1,681

2,146

Impairment of intangible assets (3)

5

1,581

330

3,604

Fair value remeasurement of contingent consideration

(48)

4

(124)

(238)

Expenses arising from the impact of acquisitions on inventories

53

3

Restructuring costs and similar items

196

158

1,064

1,062

Other gains and losses, and litigation (4)

(67)

(136)

(327)

Gain on sale of Regeneron shares on May 29, 2020 (5)

(7,225)

Tax effect of the items listed above:

(101)

(581)

(264)

(1,857)

Amortization and impairment of intangible assets

(117)

(503)

(541)

(1,409)

Fair value remeasurement of contingent consideration

38

(10)

39

(6)

Expenses arising from the impact of acquisitions on inventories

(8)

Restructuring costs and similar items

(32)

(64)

(293)

(311)

Gain on sale of Regeneron shares on May 29, 2020

2

477

Other tax effects

8

(4)

62

(131)

Share of items listed above attributable to non-controlling interests

(1)

(3)

(4)

Restructuring costs of associates and joint ventures, and expenses arising from the impact of acquisitions on associates and joint ventures

71

(30)

165

Effect of discontinuation of use of equity method for Regeneron investment (6)

(132)

(313)

(411)

Animal Health Items

1

101

Business net income

1,527

1,534

7,347

7,050

IFRS earnings per share (7) (in euros)

0.86

(0.01)

9.82

2.24

(1) Business operating Income restated to exclude any effect of equity method accounting for Regeneron investment and to include the Impact of lease standard IFRS 16 for comparison purposes.

(2) Of which related to amortization expense generated by the remeasurement of intangible assets as part of business combinations: €370 million in the fourth quarter of 2020 and €488 million in the fourth quarter of 2019.

(3) In 2019, mainly related to Eloctate Impairment.

(4) In 2020, includes mainly the gain on the sale of operations related to the Seprafilm product to Baxter. In 2019, net gain of € 317 million related to litigation.

(5) This line includes the result of the sale of 13 million of Regeneron’s shares as part of the public offering and of the 9.8 million of its shares repurchased by Regeneron. The amount does not include the gain related to the remeasurement at fair value at this date of the 400,000 retained shares.

(6) Our non-GAAP indicator (Business Net Income) does not include the share of income related to equity accounting from Regeneron since it ceased to be an associate on May 29, 2020. As a result, this line reflects that exclusion up to this date.

(7) Q4: Based on an average number of shares outstanding of 1,255.1 million in the fourth quarter of 2020 and 1,253.1 million in the fourth quarter of 2019.
Full year : Based on an average number of shares outstanding of 1,253,6 million in full year 2020 and 1,249.9 million in full year 2019.

Appendix 5: Change in net debt

€ million

2020

2019

(1)

Business net income

7,347

7,050

Depreciation & amortization & impairment of property, plant and equipment and software

1,507

1,593

Other non-cash items

34

584

Operating cash flow before change in working capital

8,888

9,227

Changes in Working Capital

(35)

(580)

Acquisitions of property, plant and equipment and software

(1,329)

(1,405)

Free cash flow before restructuring, acquisitions and disposals

7,524

7,242

Acquisitions of intangibles assets, investments and other long-term financial assets (2)

(562)

(576)

Restructuring costs and similar items paid

(910)

(1,142)

Proceeds from disposals of property, plant and equipment, intangible assets and other non-current assets net of taxes (2)

930

490

Free cash flow

6,982

6,014

Acquisitions of investments in consolidated undertakings including
assumed debt (3)

(5,786)

Proceeds from disposals of assets net of taxes (3)

672

Proceeds from Sale of Regeneron Shares on May 29,2020 net of taxes

10,370

Net cash flow from the swap between BI- CHC and Sanofi Animal Health business

105