Transforming Sanofi-Aventis
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Case Code: BSTR358 Case Length: 18 Pages Period: 2008-2009 Pub Date: 2010 Teaching Note: Not Available |
Price: Rs.300 Organization: Sanofi-Aventis Industry: Healthcare, Pharmaceuticals Countries: France; Global Themes: Growth strategy, Diversification, Transformation |
Abstract Case Intro 1 Case Intro 2 Excerpts
Excerpts
Enter Viehbacher
Viehbacher was half Canadian, half German, and in his late 40s. Before taking over as Sanofi-Aventis' CEO, he had been head of GSK's US operations, and had had more than 20 years' experience in the company. He had previously overseen the French market of Glaxo Wellcome and spoke French fluently...
Overhauling R&D
Viehbacher said that Sanofi-Aventis' R&D would be overhauled in a bid to make it productive and in sync with patient's needs and the demands of the rapidly changing pharmaceutical environment. The new approach to R&D was aimed at driving creativity and innovation by simplifying the R&D organization...
Emerging Markets
Viehbacher was quick to note that Sanofi-Aventis was the #1 pharmaceutical company in emerging markets, which accounted for around 25% of its revenue and 70% of its growth. , Sanofi-Aventis held the #1 position in Brazil, Mexico, Algeria, and Morocco; #2 in Russia; #3 in South Korea, Turkey, and South Africa; #4 in China; and #9 in India...
Diversification
According to Viehbacher, in order to serve the world's population, Sanofi-Aventis had to move away from the blockbuster model and strengthen its presence in other healthcare segments such as vaccines, consumer health, generics, and biologics...
Disciplined Acquisitions
Experts felt that patent expiries, unproductive R&D pipelines, fewer drugs approved each year and lower sales from new drugs, were forcing old-line pharmaceutical companies to opt for mega-mergers or bolt-on acquisitions. Mega-mergers were multi-billion dollar deals between two major pharmaceutical companies aimed at creating a company with more drugs and opportunities to cut costs...
Looking Ahead
For the first half of 2009, the company showed good performance. In particular, Sanofi-Aventis's Q2 revenue and net profit increased significantly over the previous year, and the company raised its 2009 earnings-per-share guidance by three percentage points to 10%...
Exhibits
Exhibit I: Consolidated Income Statement: First Half 2009 (€ million)
Exhibit II: Sanofi-Aventis Five-Year Stock Chart
Exhibit III: Sanofi-Aventis' Position in Various Segments: 2008
Exhibit IV: Top Ten Pharmaceutical Companies by Global Sales
Exhibit V: Sanofi-Aventis' Income Statement
Exhibit VI: Sanofi-Aventis' Balance sheet
Exhibit VII: Sanofi-Aventis' Financial Ratios
Exhibit VIII: Sanofi-Aventis' Top Products: 2008
Exhibit IX: Sanofi-Aventis' R&D Portfolio
Exhibit X: New Drug Development Timeline for the US
Exhibit XI: Global Pharmaceutical Sales by Region: 2008
Exhibit XII: Top Ten Pharmaceutical Companies after Mergers
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