2014 - Exane BNP Paribas Healthcare Conference

Exane BNP Paribas Healthcare Conference Fabrice Baschiera, General Manager, Sanofi Greater China

Paris – March 25th, 2014

2

Forward Looking Statements

This presentation 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 labeling and other matters that could affect the availability or

commercial potential of such product candidates, the absence of guarantee that the product candidates if approved will

be commercially successful, the future approval and commercial success of therapeutic alternatives, the Group's ability

to benefit from external growth opportunities, trends in exchange rates and prevailing interest rates, the impact of cost

containment policies and subsequent changes thereto, the average number of shares outstanding as well as those

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, 2013. Other than as required by applicable law, Sanofi does not undertake any

obligation to update or revise any forward-looking information or statements.

Agenda

3

Emerging Markets – Strong Contribution from China

A Leading Presence in the Chinese Healthcare Market

Strategic Pillars for continued Growth in China

Providing Solutions to the Diabetes Pandemic in China

Conclusion

Sanofi 2013 Review

2013 Year in Review

From Sep to Dec 2013, the underlying growth profile of the new

Sanofi emerged

Throughout 2013, we left the patent cliff further behind us and

took decisive action to resolve temporary operational challenges

Growth platforms now account for 73% of sales(1)

compared to 43% in 2008

Sanofi has currently 9 high-potential late-stage projects(2)

45% of sales(3) come from biologics and 80%

of development pipeline projects(4) are biologics

1

2

3

4

4

(1) Growth Platforms include Emerging Markets, Diabetes Solutions, Vaccines, Consumer Healthcare, Animal Health, Genzyme & Other Innovative

Products. In Q4 2013, sales from Growth Platforms accounted for 72.9% of Group sales

(2) U300, 6-in-1 vaccine PR5I (U.S.), alirocumab, Dengue vaccine, lixisenatide (U.S.), sarilumab, LixiLan, dupilumab, C. Diff vaccine

(3) Sales from biologics include insulins (Lantus®, Apidra®, Insuman®), Genzyme rare disease products, Lovenox®, vaccines from Sanofi Pasteur,

vaccines from Merial, selected oncology products (Thymoglobulin®, Mozobil®, Zaltrap®), Lemtrada™ and half of SPMSD sales (non-consolidated)

(4) 39 NMEs and vaccines out of a total of 49

5

Genzyme(3)

Vaccines

Growth Platforms Grew by +10.0% in Q4 2013

Reaching 72.9% of Sales(1)

5

(1) FY 2013 sales of Growth Platforms reached €23,905m, up +6.6% at CER and accounted for 72.5% of sales

(2) Sales in Emerging Markets excluding other Growth Platforms were €1,525m for Q4 2013 and €5,785m for FY 2013

(3) Genzyme perimeter includes Rare Diseases and Multiple Sclerosis franchises

(4) Products launched since 2009 which are not included in the Growth Platforms listed above: Multaq®, Jevtana®, Auvi-Q™, Mozobil® and Zaltrap®

Other Innovative Products(4) €186m

€959m

Diabetes Solutions €1,735m

€722m

Animal Health

€595m

Emerging Markets(2) €2,917m

€705m

€3,716m

€6,568m

€3,004m

€2,142m

€10,957m

Q4 2013

Sales & Growth at CER

FY 2013

Sales & Growth at CER

€444m

Consumer Healthcare

€1,985m

+19.0%

+0.1%

+6.1%

+31.4%

-6.3%

+15.7%

+10.4%

+18.7%

-0.1%

+5.2%

+25.9%

-5.3%

+18.8%

+4.4%

+7.1% ex Brazil generics

9 Late-Stage Projects Potentially Filed over Next 4 Years

9 Potential Filings in 2014-2018

● U300 in Diabetes

● 6-in-1 vaccine PR5I (U.S.)

● Alirocumab in Hypercholesterolemia

● Dengue vaccine

● Lixisenatide in Diabetes (U.S.)

6

● Sarilumab in Rheumatoid Arthritis

● LixiLan in Diabetes

● Dupilumab in Atopic Dermatitis

and Asthma

● C. Diff vaccine

Agenda

7





Conclusion

Sanofi 2013 Review

Q4 2013 Geographic Sales Mix

(1) World excluding U.S., Canada, Western Europe (France, Germany, UK, Italy, Spain, Greece, Cyprus, Malta, Belgium, Luxembourg, Portugal,

Holland, Austria, Switzerland, Sweden, Ireland, Finland, Norway, Iceland, Denmark), Japan, Australia, and New Zealand

Double Digit Sales Growth in Emerging Markets

in Q4 2013

34.5%

31.4%

23.0%

11.1%

8

(1)

+12.3% +5.2% +15.4% +10.1% Growth

at CER

+1.2%

-5.6%

+11.3%

+10.4%

Sanofi China – A Strong and Growing Contributor to Our

Leadership Position in Emerging Markets

9

(1) IMS CHPA MAT December 2013

(2) Mainland China; CAGR 2008-2013

Sanofi Sales in China(2)

€347m

2012 2011 2010 2009 2008

+33%

2013

Ranked #4 in China(1)

Sanofi China represented 13% of Emerging Markets and 4.5% of Group sales in 2013

€1,471m PFIZER

ASTRAZENECA

SHANDONG QILU FTY

BAYER

JS. YANGZIJIANG FTY

ROCHE

KE LUN

NOVARTIS

JS.L.Y.G. HENGRUI

1

2

3

4

5

6

7

8

9

10

10

Progressively Developing Our Growth Platforms in China

Breakdown of Sanofi Sales in China(1) by Business(2)

Total Sales €1,471m

72%

2007 2013

Total Sales €273m

(1) Mainland China

(2) Illustrative 10

Pharmaceuticals

Genzyme

Consumer Healthcare

Diabetes

Vaccines

Animal Health/Merial

Agenda

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Conclusion

Sanofi 2013 Review

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(1) Health care expenditure reflects the total expenditure on medical and health care services, which includes government expenditure,

social expenditure and individual out-of-pocket expenditure.

(2) China National Bureau of Statistics, Ministry of Finance; projections: BCG, McKinsey, internal analysis

(3) WHO : ‘Total expenditure on health as % of Gross National Product’ (GDP); 2011: U.S. = 17.9%; France = 11.6%; Brazil = 8.9%

(4) IMS Market Prognosis, September 2013, at ex-manufacturer price levels, not including rebates and discounts; IMS CHPA 2013 M12

Fundamental Drivers for Continued Strong Growth in

the Chinese Healthcare Market

Healthcare Expenditure(1) Expected to Grow

Strongly, but to Remain Low as % of GDP(2)

HC expenditure as % of GDP(3)

2015e

2012 2009 2005

RMB bn

4,100

2020e

8.9%

11.6%

17.9%

5.4%

● Ageing Population

● Strong patient flow growth

● Growing Middle Class

● Higher disposable income

● Rapid Urbanization

● Change in life-style

● Higher incidence of chronic diseases

● Rise in disease burden

● Favorable healthcare reform policies

● Expanded insurance coverage and

improved infrastructure

China has become the 2nd largest Pharmaceutical Market,+13.8% in 2013(4)

A Dynamic Environment with Sustained Pricing Pressure

Multiple Rounds of Price Cuts by

NDRC(3)

May 2007 260 drugs (excl. TCM(4)) 19%

162 anti-infective and cardiovascular drugs

21%

Nov 2010

Mar 2011

19% 176 drugs

128 drugs including hormone treatments, endocrine system and neurological disorder drugs

14% Sep 2011

Target

Average %

of price cut

(1) RDL – Reimbursement Drug List

(2) EDL – Essential Drug List

(3) China National Bureau of Statistics, Ministry of Finance, NDRC – National Development and Reform Commission, internal analysis

(4) TCM - Traditional Chinese Medicines

(5) ‘Good Manufacturing Practices’; Notice on Implementation the 2010 Revised GMP, CFDA, 25 February 2011

May 2012

13

Time

53 digestive system and gastrointestinal drugs

17%

Oct 2012 95 hematology, oncology and immunology drugs

17%

Jan 2013 400 respiratory, antipyretic, analgesics and other specialty drugs

15%

● Regular RDL(1) price cuts

● Erosion of price premium for non-

patented originator drugs

● Broader EDL(2) system and usage

● High EDL usage in lower tier CHC

(Consumer Healthcare Centers)

● New Provincial tender models

● Increased frequency and emphasis

on price

● Emergence of strong local players

● Enhanced quality of non-EDL

un-/differentiated generics

● All Chinese manufacturers to comply

with recent ‘GMP 2010’ guidelines(5)

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Sanofi China - Well Poised to Seize the Opportunities in

the Chinese Healthcare Market

14

Shanghai

Tianjin

Shenyang

Wuhan Chengdu

Urumqi

Ji’nan

Beijing

Hangzhou

Guangzhou

Nanjing

Nanchang

Tangshan

Shenzhen

Regional offices Production Sites R&D center Regional R&D

● >8,500 Employees

● >5,000 Sales force

● 11 Regional Offices

● Regional R&D Platform

● 7 Manufacturing Sites

● Local Production for

Pharmaceuticals, Vaccines,

CHC and Animal Health

● Highest Standards for

Quality, Sustainability and

Supply Chain

A Fully Integrated

Presence

A Large Portfolio of Flagship Brands and Powerful

Commercial Operations

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Oncology BU

Cardiovascular BU 1. Cancer

2. Heart disease

3. Cerebro-vascular

diseases

4. Respiratory

System

5. Injury/Poisoning

6. Metabolic/

Endocrine

diseases

7. Digestive

system

8. CNS

9. Genitourinary

system

10. Infectious

diseases

Top 10 Causes of

Death in China(1)

(1) China’s Health Statistics Yearbook 2012, Ministry of Health (Urban population)

Consumer Healthcare BU

Diabetes Solutions BU

Primary Care BU

A dedicated regional BU which covers the county market in China

Addressing the Medical Needs in China with 5 Business Units

Driving Leadership and Innovation at Sanofi China R&D

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Four Dimensions of Innovation at Sanofi China R&D

to Address Unmet Medical Needs

● Over 30 local R&D

Collaborations and

Partnerships

● Focus on Liver

Disease, Asian

Cancers and

Diabetes

● More than 15

ongoing clinical

development

programs to bring

global innovation &

minimize drug-lag

● Eloxatin® in HCC

● Lyxumia® (1)

under

regulatory review

● China R&D

Translational

Medicine Platform

for Regional and

Global R&D

● Genotyping Study

for prevention and

treatment of

Diabetes in

Chinese patients

Research Clinical

Development

External

Innovation

Medicine

Leadership

● Enrich pipeline with

in-licensing

opportunities

(2)

● R&D investment to

leverage and

capture TCM

opportunity

(1) Lyxumia® is the proprietary name approved by the EMA for lixisenatide. The proprietary name for lixisenatide in the U.S. is under consideration

(2) Takeda and Sanofi signed a co-promotion agreement to expand reach of diabetes treatment Nesina® (alogliptin) in China

Agenda

17





Conclusion

Sanofi 2013 Review

Total Pharma Market by Institution(1) (in € bn)

(1) BCG, internal analysis (1 EUR = 8.6212 CNY); China’s Health Statistics Yearbook 2012; National Health and Family Planning Commission

(2) THC = Township Healthcare Center

(3) CHC = Community Healthcare Center

(4) National Health and Family Planning Commission of PRC (NHFPC), 2014

Capturing the Growth in China’s County Hospital Market

by Reaching out to the Next Billion Customers

18

2011 2015e 2020e

+13%

18%

20%

23% County

hospitals

City

hospitals

CHC(3)

THC(2)

Retail

48%

50%

50% 20%

19%

17%

80

141

237

● The County market is the focus of

public healthcare investments(4)

● ‘County hospitals’ expected to be

the fastest growing market

segment(1)

● 16% growth (2011-2020 CAGR)

● ‘City hospitals’ forecasted to

represent half of the total market

● Declining share of basic

healthcare system (CHC, THC)

and retail market projected

Chongzhou County Hospital(2)

● County – Chongzhou

● Population – ~670,000

● County hospital – Built in 2008

● Number of beds – 694

● Outpatient visits in 2013 – 581,782

Modern Healthcare Infrastructure is Driving the Growth in

China’s Huge County Market

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(1) Defined as county-level cities or counties; 32 provinces, autonomous regions and municipalities, excluding Hong Kong, Macao, and Taiwan

(2) Sichuan Chongzhou Hospital website: http://www.cz-hospital.cn/

China’s ~2,000 Counties(1)

Population ~900 million

Opportunity

● Huge base

● Lower affordability

● Geographically broad

Coverage Very limited presence of

Multinational Companies

Example: Sichuan Province, Chongzhou County

Sichuan

Province

● Reaching out to >1,000 counties in multiple provinces

● Almost 1,000 dedicated sales representatives, covering several thousand hospitals

● Portfolio approach to secure sales force efficiency and profitability

● Strict selection criteria for targeted county hospitals

● Significant growth contribution and further expansion underway

Our Rapid Expansion into the County Hospital Market

follows a Highly Selective Approach

2013 2014

Sanofi Primary Care Business Unit

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Top 10 OTC Markets in 2013(1)

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● Highly attractive CHC market with

solid growth in recent years

● Sanofi is present in the 2 largest and

fastest growing CHC categories in

China(2)

● Cough&Cold and Vitamins

● Improved performance of our CHC

business in China throughout 2013

● Reorganization of our distribution

network

● Reduced inventory levels

● New management appointed

(1) Nicholas Hall & Company (2014); Growth 2013 vs 2012

(2) Nicholas Hall & Company DB6 (2013)

1. USA 28.8bn

2. 20.3bn

3. Japan 7.9bn

4. Russia 6.0bn

5. Germany 5.7bn

6. France 4.8bn

7. Brazil 3.6bn

8. Italy 3.6bn

9. UK 3.0bn

10. Canada 2.6bn

3.5%

6.8%

-0.3%

14.0%

3.7%

-3.7%

16.9%

3.8%

1.2%

2.5%

Rank by Country Sales in USD Growth

Strong Ambition to Realize Our Growth Potential in the

World’s 2nd largest Consumer Healthcare Market

Our Strategy for Sustainable Growth in the Chinese

Consumer Healthcare Market

Reinforce the Business Expand the Portfolio

Value Enhancing

External Opportunities

Two Umbrella Brands

in key CHC Categories

(Cough/Cold & Vitamins)

OTC Switch of Essentiale®

and

VMS Specialty Segments

Market screening and target

assets identification

1 2 3

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● Targeting domestic

players

● Presence in Sanofi CHC

core categories required

● Strong brand equity

● Liver Care

Category

with

Essentiale®

● Specialty

VMS Category

with “Silver”

variant

for Seniors

Agenda

23





Conclusion

Sanofi 2013 Review

The Diabetes Pandemic in China Creates Significant

Challenges for the Hospital Care System

113.9(3)

China Has the World’s Largest Population Living

with Diabetes(1) (population in million)

24

(1) International Diabetes Federation (IDF) Diabetes Atlas, Sixth Edition 2013; Top 10 countries/territories of people with diabetes (20-79 years)

(2) The Lancet, Vol 378, August 6, 2011

(3) Ning Guang, JAMA September 4, 2013, Vol 310, No. 9

● Control of chronic diseases,

such as diabetes, is a major

challenge in China(2)

● Low rate of diagnosis in diabetes(3)

● Low number of patients treated

● Only 25.8% or ~29.4m treated(3)

● Hurdles to providing chronic care at

the hospital level

● Crowded out-patient environment

● Short physician consultation

● No continuous follow-up treatment

with the same physician

65.1

24.4

11.9

10.9

8.7

8.5

7.6

7.5

7.2

Insulins:

CAGR 2009-2013, +21.5%

MAT Dec 2013, +18.6%

Sales Value of Diabetes Therapy Segments (in € m)(2)

2013

49%

2012

50%

50%

2011

52%

48%

2010

54%

46%

2009

55%

45%

2008

56%

44%

2007

59%

41%

50%

Insulin has Overtaken OADs(1) to Become the Largest

Diabetes Therapeutic Segment in China

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Oral Anti-Diabetics (OADs):

CAGR 2009-2013, +14.9%

MAT Dec 2013, +15.3%

Total Market

CAGR 2009-2013, +18.2%

MAT Dec 2013, +17.1%

(3)

China’s diabetes drug market expected to reach >€4bn in 2018(4)

(1) OAD – Oral Anti-Diabetic (2) IMS CHPA MAT 2007 – 2013; 1 EUR = 8.6212 CNY (www.ecb.europa.eu, March 19, 2014)

(3) GLP-1 market share 0.68% in 2013 (4) IMS and internal analysis

1,534

1,310

1,146

966

785

607

435

Analog:

CAGR 2009-2013, +37.4%

MAT Dec 2013, +27.8%

Human:

CAGR 2009-2013, +7.6%

MAT Dec 2013, +6.2%

Sales Value of Insulin Class (in € m)(1)

43%

57%

2011

50%

50%

2010

55%

45%

2009 2012 2013

62%

38% 62%

38%

2008

72%

28%

2007

81%

19%

Analogs Account for >60% of Total Insulin Sales in China

26 (1) IMS CHPA MAT 2007 – 2013; 1 EUR = 8.6212 CNY (www.ecb.europa.eu, March 19, 2014)

547

445

355

652

774

269

178

● Lantus® drives the paradigm shift in

the Chinese insulin market

● Shift from Premix to Basal

● Basal regimen included in Chinese

diabetes treatment guidelines

● Leading insulin in several big cities(2)

● Low average daily dosing per patient

● ‘Biosimilar’ to Lantus® competing in

the market since 2005

27

Paradigm Shift Drives Strong Sales of Lantus® in China

(1) IMS MAT 12/2009 – 12/2013; 1 EUR = 8.6212 CNY (www.ecb.europa.eu, March 19, 2014)

(2) IMS CHPA MAT 12/13; Cities where Lantus is the #1 insulin include Guangzhou, Hangzhou, Suxi, Nanjing, Chengdu, Xi’an, Shenzhen, Shijiazhuang, Changsha, Guiyang,

Wenzhou

2012

2011 2010

2009

Lantus Sales in China(1) (in € m)

29%

2013

45

64

84

106

125

Expanding our Lantus® Options in China

● SoloSTAR® disposable pen

● Convenience option

● Lantus® available in China only in

SoloStar® until 2013

● Lantus® SoloSTAR® pen assembly

at Sanofi’s facility in Beijing

● Inaugurated in May 2012

● ClikSTAR® re-usable pen for

Lantus® cartridges

● Durable solution

● Differentiated price

● Registration approval in Q4 2012

● Launched in March 2013

Easy-to-use, Accurate and Affordable

28

AllStar™, the next step to further improve access to innovative, affordable devices

Amaryl® is Driving the Growth of the entire Sulfonylurea

Class in China despite Generic Competition

Share in Glimepiride (value)(2)

Share in Glimepiride (volume)(2)

(1) OAD – Oral Anti-Diabetic; In December 2013, Amaryl® reached 7.0% of the market share of the total OAD market, growing at 23.3%

(2) IMS CHPA MAT December 2013

Generics

Amaryl®

Generics

Amaryl®

Generic

Glimepiride

Glurenorm

Diamicron

Glipizide XL

Market Share of sulfonylureas (value)(2)

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● Patient-centric, integrated diabetes

management programs

● CIDE – ‘China Initiative for Diabetes

Excellence’

● A major public-private

partnership

● Enhancing patients’ self-management

capabilities through ‘PEP’

● Basal Insulin Patient

Education Program

● Multiple programs addressing the

educational needs of doctors, nurses

and other healthcare professionals

● Providing hospitals with technology &

tools to improve treatment success

Providing Support for the Management of Diabetes in

China at the Point of Care

Broad range of innovative

therapeutic solutions

30

Private-public partnerships for

best practice diabetes care

Agenda

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Conclusion

Sanofi 2013 Review

A Compelling Strategy for Sustainable Growth in China

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1

2

3

4

Long term commitment to China with a fully-integrated presence

Medicine leadership through a broad portfolio of products and innovation

Expansion into Counties aligned with the focus of public healthcare investments

Reinforcing our platform in the growing Chinese CHC Market

Leadership in diabetes by maximizing the value of the entire portfolio

Investment into medical education and public-private partnerships

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2014 - Exane BNP Paribas Healthcare Conference

Health & Medicine

Transcript of 2014 - Exane BNP Paribas Healthcare Conference