Sanofi SA (EPA: SAN) have seen their shares jump on Tuesday morning, after the firm said that it would be narrowing its drug focus.
Sanofi shares jumped 4.56% to €85. 10/12/19 11:50BST.
Sanofi hit news headlines yesterday, as the firm announced the purchase of biotechnology firm Synthorx Inc (NASDAQ: THOR) in a deal valued at $2.5 billion.
Additionally, At the end of October, Sanofi reported strong sales growth €9.5 billion, up 1.1%. Its notable highlights included; a 19.5% jump in sales from Sanofi Genzyme, driven by the ‘strong’ uptake of its Dupixent product; emerging markets sales growth of 9.7% and CHC sales growth of 0.4%.
Today, the firm has seen its shares spike as the firm said it would focus on vaccines and treatments to grow sales in a business restructuring program.
Rivals, such as FTSE100 listed GlaxoSmithKline have also pledged to cut costs, and have also seen a period of strong trading.
GSK have seen their expectations rise and also have won marketing authorization for drugs in China.
Additionally, Novartis (NYSE: NVS) made a pledge to the market and shareholders to cut their costs in an attempt to boost margins and zoom in on specific drugs. However, for Novartis this has led to job cuts and many operational scale backs.
Sanofi have been a leader in the diabetes market with its prescription medication Lantus, Sanofi has struggled in recent years to keep up the pace in this field with new treatments, and revenues faltered as patents expired.
“We are encouraged that Sanofi is prioritizing Dupixent,” analysts at Credit Suisse said in a note.
Sanofi also announced a target to reach a core operating margin of 30% by 2022, up from 25.8% last year, and ahead of some analysts’ targets, including those at Jefferies, according to Reuters.
The group said that it would leave its consumer health business as a standalone unit which freedom to work individually, on top of three main divisions.