Hyderabad: French drug maker Sanofi SA, which has made 23 acquisitions in the last two-and-a-half years after Christopher Viehbacher took over as chief executive in January 2009, is taking a localized approach to ensure growth, especially in emerging markets including India.
“We don’t want to be a colonial pharma company, and all the companies that we acquired in the transition phase will maintain their identity in vision and pricing,” Viehbacher said in Hyderabad on Wednesday.
The chief executive’s India trip follows acquisitions that Sanofi made in the country, including Hyderabad-based vaccine maker Shantha Biotechnics Ltd and Universal Medicare Pvt. Ltd in Mumbai.
Specialized approach: Christopher Viehbacherr, chief executive officer (CEO) of Sanofi Group, says drug prices will be driven by the nature of each market.
“Sanofi has undergone an impressive transformation over the last two-and-a-half years and it had already put the bigger threat of patent expiry of some of its blockbuster drugs in the US and other key markets (in) the past,” he said.
Emerging markets and India in particular are going to play a critical role in growth, he said.
Sanofi is set to embark upon a period of consistent and sustainable growth “due to the strength of our growth platforms, the addition of the recently acquired US biotech company Genzyme as well as our continuous financial discipline,” he said. “Today we are setting for ourselves the objective of delivering sales growth of at least 5% per year on average over 2012-2015.”
Sanofi, which posted sales of $30 billion in 2010, acquired vaccine maker Shantha Biotech in 2009. The unit is setting up a new manufacturing facility on the outskirts of Hyderabad that will make several new vaccines for local and world markets.
“We invested about $300 million in Shantha after the acquisition,” said Viehbacher.
Since the end of 2008, Sanofi has focused on three pillars—increased innovation in research and development, external growth opportunities, adapting the structure for future challenges and opportunities.
“Over this period, the group has centred its activities around six growth platforms, including emerging markets, human vaccines, diabetes solutions, consumer health care, innovative products and animal health,” Viehbacher said.
In parallel, Sanofi has built a leaner pharma research organization. A review of its research and development portfolio led the group to refocus on high-value projects and to reallocate resources to external partnerships. Sanofi has also signed 61 in-licensing agreements, including two deals with India’s Glenmark Pharmaceuticals. Senior executives with international experience have also joined the management team.
Sanofi expects to extend its leadership in emerging markets, expected to account for 38-40% of sales in 2015 compared with 29% in 2010, implying double-digit sales growth in these regions over 2012-2015.
The purchase of Universal will give Sanofi a strong foothold in the consumer healthcare or over-the-counter market, the chief executive said.
“As far as pricing is concerned, we don’t have a uniform global strategy, but it will be largely driven by the nature of each local market and the group as such will try to complement the efforts of the local management,” said Viehbacher.