Sanofi (SNY) is prepared to pursue larger acquisitions as it seeks to rebuild its pipeline of experimental drugs under new chief executive Belen Garijo, after the French drugmaker raised its 2026 growth targets for the second time this year.
Shares in the group rose almost 6 per cent to their highest level since April, making it one of the biggest gainers in Europe.
Garijo, who took the top job in May, faces the task of charting Sanofi’s growth beyond the early 2030s, when its blockbuster asthma drug Dupixent loses patent exclusivity. She has launched a strategic review and promised investors faster decision-making. She has also reshaped her executive committee, expanding the remit of chief financial officer Francois Roger to include business development and hiring former Roche (RHHBY) executive Paulo Fontoura to lead research and development.
Roger said Sanofi was increasingly interested in deals that would give it access to late-stage medicines or marketed products, and would consider acquisitions above its usual range of $2bn to $5bn. “These assets are more expensive,” he told journalists after third-quarter results. He said the group would stick to areas where it already operates, namely immunology, rare diseases and vaccines, but could also look at “white spaces or moonshots” targeting unmet medical needs.
“We are fully committed to executing on our plan and moving with the necessary sense of urgency,” Garijo told analysts, adding that Sanofi would provide more detail on its medium- to long-term priorities before the end of the year.
Analysts estimate Sanofi has about €20bn to spend on deals and expect it will need to deploy some of that before a raft of late-stage trial data due in 2027. Markus Manns, a portfolio manager at shareholder Union Investment, said management “has understood the urgency of the situation” and that he expected a transaction “sooner rather than later”. He added that he would be watching for Fontoura’s plans to rebuild the internal pipeline.
Sanofi has also expanded its partnership with Regeneron (REGN) in a deal worth up to $8bn, under which the companies will develop four new drugs together and settle prior litigation.
The group now expects sales to grow at a low-teens percentage rate this year and earnings per share to rise at a mid-teens rate, helped by strong Dupixent sales and cost control. It had previously forecast sales growth of 10 per cent at constant exchange rates, with earnings per share growing slightly faster. At least three analysts said the upgrade would lift consensus full-year earnings forecasts.
Roger said Sanofi was focused on “returns rather than restructuring” and was investing heavily in artificial intelligence for research and development, which it expects could shorten some development timelines. The company is also simplifying processes and governance to move faster.
Third-quarter business operating income reached €5.43bn, well ahead of market expectations of €4.32bn. Profit was boosted by a larger contribution from newer launches, including the hemophilia A treatment Altuviiio, and by better net pricing. Total sales rose 14.3 per cent at constant exchange rates to €14.44bn, against analyst estimates of €13.25bn. Dupixent sales reached €5.69bn, about 10 per cent above expectations.