pharmaceutical company Roche and Sanofi’s Recent earnings have been largely in line with expectations, with both companies touting the potential of their experimental drugs in the face of the looming “patent cliff” facing big drug companies.
Shares of both companies fell less than 1% Thursday after reporting their results before the bell.
Both companies are among drug companies whose revenues could decline significantly over the next few years unless they replenish their pipelines by developing their own drugs or acquiring drug candidates developed by other companies.
“On the pipeline side, we’re doing incredibly well with a number of Phase 3 reads that will help us grow in the future,” CEO Thomas Schinecker said Thursday on CNBC’s “Squawk Box Europe.”
“There are currently a number of medicines in late stage development, with up to 19 new medicines expected to be launched by the end of the decade.”
focused innovation
Sanofi achieved quarter-on-quarter improvement in both revenue and bottom line, and issued guidance for 2026 that was broadly in line with expectations.
Despite headwinds for its vaccine business from changes in U.S. vaccine policy, the company reported fourth-quarter sales growth of 13% in constant currencies and earnings per share of 1.53 euros ($1.20), both better than expected.
“New medicines and Dupixent supported growth, resulting in a new quarterly high,” CEO Paul Hudson said in a statement.
Like Roche, Sanofi expects sales to grow in the low single digits in 2026, with profit growth “slightly higher than sales.”
“We expect profitable growth to continue for at least five years,” the company said.
Despite the beat and the newly announced €1 billion share buyback, Sanofi investors’ focus remains on the company’s research and development.
Jefferies analyst Michael Leuchten said in a post-earnings note that due to the need to expand the pipeline, Sanofi’s earnings call Thursday afternoon will focus on long-term research and development spending and potential future M&A.
obesity entry
Apart from its experimental breast cancer drug giledestrant and multiple sclerosis drug fenebrutinib, Roche is betting big on a corner of the lucrative obesity market for years to come.
The company faces a significant loss of exclusivity for some of its best-selling drugs, but CEO Schinecker told CNBC that this is “absolutely manageable.”
The company on Tuesday reported positive results in a Phase 2 clinical trial for its weight loss drug candidate CT-388. The drug was shown to result in a 22.5% weight loss over 48 weeks, comparable to market rivals. novo nordisk Wegobee and Eli Lilly’s Zep bound. Through differentiation, the company hopes to be able to compete in an increasingly crowded market.
Last year, Roche partnered with Denmark’s Zealand Pharmaceuticals to jointly develop Zealand’s drug petrelintide, an amylin analogue, either alone or in combination with CT-388.
“We’re not investing in the first generation of these drugs, we’re investing in the next generation,” CEO Schinecker told CNBC on Thursday.
“With over 200 comorbidities in neurology, immunology and cancer, no other company has the portfolio that we have in terms of combinations, so we can differentiate by combining it with other treatments we have in-house,” he said, adding that there is room to differentiate not only in diagnostics but also in long-lasting molecules themselves.
