Sanofi

Hello everyone, this is Thomas Guslaten from the Tenofi IR team. Welcome to the first quarter 2026 conference call for investors and analysts. As usual, you will find the slides on tenofi.com. Please turn to slide number three. Here we have the usual forward-looking statements. We would like to remind you that information presented in this call contains forward-looking statements, which are subject to substantial risk and uncertainties that may cause actual results to differ materially. We encourage you to read the disclaimer in our slide presentation. In addition, we refer you to our new Form 20F on file with the U.S. SEC since February and our French Universal Registration Document for description of these risk factors. As usual, we'll be making comments on our performance using constant exchange rates and other non-IFRS measures. Numbers used are in millions of euros and for the first quarter, unless stated otherwise. Please turn to slide number four. First, we have a short presentation, then we'll take your questions. We aim at keeping it all to one hour, including the questions. We are mindful that other companies are also reporting today. For the Q&A, we have Manuela and Thomas to cover our global businesses, as well as Roy, our General Counsel, and Brendan, Head of Manufacturing and Supply. You can participate in this Q&A in two ways. Either raise your hand and Zoom, or submit your question using the Q&A feature. With that, I now hand you over to Olivier, our Interim CEO.

Hello, everyone, and thank you for joining our conference call. As Thomas mentioned, I'm the Interim CEO before our new CEO, Belen Garrigo, joined Sanofi in May after next week's Annual General Meeting. Before we get started, I also want to thank Paul Hudson for his work as CEO from 2019 to 2026 and his work with the management team here at Sanofi. Now, on results, I'm pleased to report that we delivered a strong start in 2026, with double-digit sales growth and earnings growth, reflecting strong performance across our company. Pharma launches performed well, driven by Ekavit, Altuvio, and Sarkliza. This exemplifies our ability on the commercial side. Modest vaccine growth was led by our expanded PPH portfolio, which now includes the hepatitis B vaccine, Epislav B, following the Dynavax acquisition that closed in February. Other medicines were impacted by the ongoing divestment of legacy medicines and modest contraction in older medicines in the rest of the world. DuPixent continued its strong performance with continued underlying volume growth across indications and market, while dollar growth was boosted from a lower base of comparison in the US in 2025. Overall, the first quarter demonstrated solid progress across our key growth drivers and sets up well for the remainder of the year with guidance and change. Turning now to slide six, our launches continued to drive strong momentum and represented 14% of total sales. The performance was led by Altuvio with 325 million euros in sales, up 42% followed by Befortis with 284 million euros reflecting continued global expansion. Sarclisa grew by 30%. to 167 million euros, driven by higher demand in all geographies, reflecting increased use in the frontline setting. We saw medicines and vaccines from our recent acquisition contribute meaningfully to growth. Ekavit delivered 170 million euros and Epislav B contributed 46 million euros since the completion of the Dynavax acquisition. Recently launched, well-read Tiflia and Micorzo continued to make progress as we expand access for patients. Overall, our launch portfolio grew by 44% versus last year, or approximately 22% excluding acquisitions. The performance of our launches reflects our continued focus on commercial delivery across the business. Turning now to slide 7, DuPixent continued to deliver exceptional sales growth, with first quarter sales approaching 4.2 billion euros. Strong year-over-year growth was driven by continued market penetration across existing and new indications, as well as a lower basis of comparison in the US last year. As shared previously, we anticipate volume-driven growth to continue with some normalization in the second half of the year as new launches annualize and comparison are getting tougher. Dupixent remains the number one prescribed biologic medicine, a crop top specialist in the US, reflecting the confidence of physicians in Dupixent's efficacy and safety profile. This performance underscores our ability to successfully launch and scale across multiple indication and geographies. With the US approval in February in allergic fungal rhinosinusitis, UPIXENT is now approved in nine indications and reach more than 1.4 million patients. Moving now to slide eight, where we outline the multiple options we have in place to sustain value creation for the DuPixent franchise. Let me walk you through each of the three pillars. First, defend. We have a robust patent portfolio of issued patents and pending application with expiration dates running from 2031 to 2045. We have a vigorous defense plan with the expectation to protect DuPixent innovations beyond the US compound patent expiration in March, 2031. Second, extend. We have the potential to extend HupicSense dosing interval to every four weeks to improve patient convenience. We will pursue this through two approaches, a higher dose approach in asthma where development is currently ongoing and a co-formulation approach for which clinical studies are expected to start in the second half of 2026. And third, innovate. we can potentially pursue new molecules to leverage our existing alliance infrastructure to bring new medicines to patients. Together, these three pillars represent multiple complementary options for continued value creation to sustain the long-term durability of the Ludwigsen franchise. Turning now to slide nine. Rare diseases are named rare as they affect relatively few people. fewer than 5 in 10,000 people, according to the EU. And in the US, rare disease affects fewer than 200,000 people. But collectively, rare disease impacts hundreds of millions of individuals worldwide. Many people face years of misdiagnosis and limited treatment options. Sanofi has built a deep, differentiated expertise across rare diseases, spanning from lysosomal storage disease, rare blood disorders, and more recently, systemic mastocytosis disorders. With this, we now have a very sustainable and competitive business. In Q1, this business reached nearly 1.8 billion euros and grew by 20% led by Ekavit and Altuvio. Our growth is fueled by innovation and by new launches, which contribute to almost half of sales. Sanofi's mission in this space is clear, to bring transformative therapies to patients faster and to remain a long-term partner to the rare disease communities we serve. On slide 10, vaccine sales reached 1.3 billion euros in the first quarter, reflecting solid underlying fundamentals. Following the consolidation of Dynavax in February, PPH and booster now include Ebislav B, which grew by 18% on a market pro forma basis. Now, I want to share some recent headlines. A new study published in the Lancet Infectious Diseases showed for the first time the benefit of Befortis in the second season. On top of an 86% reduction in RSV, LRTI, hospitalization in the first season. It demonstrated a 55% reduction in hospitalization for infants immunized in the first season. This underscores Befortis differentiated clinical profile, and long-term value for patients. Additionally, Nuvaxovid, our non-mRNA COVID-19 vaccines, continues to differentiate on tolerability as supported by the data presented at ESC-MID, a key advantage that could help drive higher COVID immunization rates. In the first quarter, our vaccine business demonstrated resilience and depth. We continue to deliver on our commercial priorities, strengthen our pipeline through disciplined business development, and build real world evidence that supports the long-term value. This gives us confidence in the trajectory ahead. Before moving to the financials, I'm pleased to highlight Sanofi's 25 years partnership with the WHO to eliminate sleeping sickness, a neglected disease affecting vulnerable population in Africa. Since 2001, we have achieved three major milestones. In 2009, together with partner, we introduced the first effective and safe combined therapy to treat late-stage sleeping sickness. Then we co-developed with DMDI the first oral treatment, which was approved in 2018. These efforts helped reduce new cases by 98% between 2001 and 2024. In February, Acoziborol, also co-developed with DNDI, received a positive CHMP opinion. Acoziborol is the first single-dose treatment and requires no hospitalization or lumbar puncture. Due to its simplicity, it can be easily administered in a remote village, supporting the WHO goals to eliminate the disease by 2030. Through the Sanofi Foundation, we donate these medicines free of charge to patients. Thank you. And I will now hand over to Francois, our CFO, for more details on the financials.

Thank you, Olivier, and hello to everyone. Starting with slide 13, net sales grew by 13.6% to 10.5 billion euros in the first quarter. Our growth was supported by three main drivers, Dupixent, our recent launches, and recent acquisitions as well. On a like-for-like basis, group sales increased by 12%. At constant exchange rates, both gross profit and margins were up, supported by a favorable product mix and continued operational efficiencies. Operating expenses increased by 7%. This was driven by increased SG&A spent due to 2025 BD and M&A activity, including Blueprint and Dynavax, as well as some one-off items. As a percentage of sales, OPEX came down by 1.9 percentage points, showing the ongoing impact of our efficiency programs. BOI was up by 10.9% and BOI margin was slightly down due to higher profit sharing and the phasing of capital gains, which were approximately 230 million euros last year versus only 40 million euros this year. Our tax rate was in line with the rate of the first quarter of 2025, with a similar additional French corporate income tax contribution in both years. Finally, business EPS grew strongly at 14%, driven by operational leverage. Turning to our 2026 outlook on slide 14, we confirm our guidance of high single-digit sales growth at constant exchange rates, with business EPS expected to grow slightly faster than sales. Please note that we have a tougher comparison base in H2 with Dupixent's new indication launches and the consolidation of Evakit, which started in July 2025. We now expect approximately 400 million euros of capital gains from divestments in 2026. In March, we signed an agreement to divest Medley, our Brazilian generics business, under very favourable market conditions. This incoming disposal will be booked below BOI and is subject to antitrust approvals. We expect to close this transaction at the earliest around the end of 2026. Profit sharing will continue to grow faster than DUPIX themselves and financial expenses are expected to increase this year with higher debt level from BD and M&A activities last year and potentially further deals this year. Finally, I'm pleased to confirm that we will complete our 1 billion euro share buyback program in the coming days. I will now hand over to Oumane for an update on our pipeline.

Thank you, Francois. The first quarter demonstrated continued momentum across our portfolio. Let me walk you through some of the key highlights. Jepixent received multiple label expansions in the EU for chronic spontaneous urticaria in children, in Japan for bullous pemphigoid, and in the US for allergic fungal rhinosinusitis, further advancing our commitment to reach more patients through new indications. We also obtained EU approval for Resiroc in third-line chronic graft-versus-host disease, marking an important milestone for patients with limited treatment options. And finally, we're pleased with the U.S. label expansion, the TZIL, to delay the onset of stage 3 type 1 diabetes in children as early as one year of age that were received just yesterday. We reported a positive phase 3 result for Venglistat, where the primary endpoint was achieved in type 3 Gaucher's disease, rare disease, while the phase 3 study in Fabry's disease did not meet its primary endpoint. We initiated new phase 3 study for frepsalimab and kidney transplantation, expanding the CD40 ligand mechanism of action in transplant biology. On the regulatory front, Weyrells received orphan designation in Japan for Weyha, an IgG4-related disease, along with breakthrough designation in the U.S. Vengolastat was also granted breakthrough therapy in the U.S. for type 3 Gaucher's disease. After a solid start to the year, now let's explore each of these areas in more detail. starting with dermatology, where we presented the amlitalimab data at the recent AAD medical meeting. Across all three pivotal studies, case one, case two, and SHORE, and across both primary endpoints, IgA and EZ, amlitalimab showed continuous improvement for both every four- and 12-week dosing schedules versus placebo through week 24 with no evidence of plateau. This was further supported by the Atlantis Phase II results through Week 52. In addition, itch reduction was similar across both dosing schedules, enabling the potential of very infrequent dosing. On safety, amlitalimab was well tolerated with low rates of conjunctivitis, pyrexian chills, and headache that were observed with other molecules. No cases of Kaposi's sarcoma were observed in these phase three studies. However, as reported, there was one observed in Atlantis, the phase two study, and one observed in the estuary phase three extension study. These cases are both cutaneous in nature, and both patients are recovering after discontinuation of treatment. In general, overall rates of malignancy were similar to placebo. We look forward to share more data from the estuary phase three extension study as we approach the regulatory submission anticipated at some point in H2-2026. In a topic dermatitis, we plan to prioritize efforts on amlitilumab and our first stat six inhibitor that recently entered phase one with our partner Rixludix. Now moving to our respiratory portfolio on slide 18, we are building a differentiated and innovative pipeline and have made further progress this quarter. We reported top-line results of linsecumig, our anti-IL-13 TSLP bispecific, when used on top of background inhaled therapies in two distinct key indications. In moderate to severe asthma, The Hercules Phase II study demonstrated statistically significant and clinically meaningful reduction in exacerbations, regardless of biomarker status, over 48 weeks. And similarly, a statistically significant and clinically relevant improvement in lung function that's measured by pre-bronchodilator FEV1, also at 48 weeks. The ongoing Olympus Phase II study will further expand the use in patients with high-risk asthma and suffering from high exacerbation rates despite symptom control. In inadequately controlled chronic rhinosanusitis with nasal polyps, the DUET phase 2 study of Lund-Secheming demonstrated statistically significant and clinically meaningful changes also in nasal polyp score, patient-reported nasal congestion and obstruction, and the Lund-Mackay CT score at week 24. Both studies showed acceptable safety profile. We are pleased with Lincecumig's results in asthma and chronic rhinosinusitis with nasal polyps and look forward to discussing phase three studies soon. The results are encouraging and we look forward to Lincecumig's ongoing Persephone and Theseus replicated phase two, three studies in the inadequately controlled COPD patients with an eosinophilic phenotype. Recall our December late stage pipeline review, we made the decision to prioritize medicines to specific indications where the mechanisms may work best. Amlatilumab, which we prioritize in asthma, to focus resources on the most promising opportunities. As for itopecumab, the Saran 1 and 2 phase 3 studies in chronic rhinocytosis with nasal polyps are ongoing, with readout anticipated next year. In COPD, we're in discussions with the regulatory authorities and with our partner Regeneron on a potential phase 3 study. There was no final decision made yet, and it will be subject to overall portfolio prioritization. Overall, our portfolio is advancing, and linsecumig is emerging as a potentially important medicine across multiple respiratory indications. Turning now to slide 19, with a relieved new CCD phase 2 study, following fortnightly 900 milligram induction, Duvaticook achieved ulcerative colitis tonicore emission placebo-adjusted rate of 27%, and Crohn's disease endoscopic response placebo-adjusted rate of 35%. During monthly maintenance and induction responder patients, Duvaticook demonstrated UC clinical mission rates of 58% and CD endoscopic response rates of 55%. The maintenance response suggests robust, sustained efficacy with a convenient monthly subcutaneous dosing. Consistent benefits were observed across clinical, endoscopic, and patient-reported endpoints, and the safety profile was well-tolerated and consistent with the induction study. These data support our ongoing phase three programs and potential life cycle management. Then on business development, we've added two molecules to potentially use in chronic versus host disease and other immune indication. Rovetacitinib, Jack Rock inhibitor from SinoBioPharm is already approved in China for first-line myelofibrosis, which fits with our focus on rare blood diseases with an ongoing phase 3 study and third-line graft-versus-host disease. Sanofi is responsible for the phase 2 development and second-line, extending our presence alongside Resiroc. From Kali Therapeutics, we licensed in the CD19, BCMA, CD3 T-cell engager, currently in phase one in immune-mediated disease, with Sanipute responsible for the phase two development. These additions reflect our focused approach to business development in areas of high unmet medical need within our strategic scope. Now pivoting to slide 20 with rare diseases, which remains a core pillar of our strategy, with historic presence across lysosomal storage diseases and a deep commitment to our patients. As previously mentioned, Vengostat met its primary endpoint in the LEAP-2 monophase 3 study in type 3 Gaucher's disease, representing a significant milestone for patients with this debilitating neurological form of the disease and can potentially augment established medicine, serozyme and sodalga. It was also designated U.S. breakthrough therapy, which was announced recently. In Fabry's disease, the PERIDOT phase 3 study did not meet its primary endpoint. The CARAT phase 3 study is ongoing as we have that evaluated path forward in Fabry's. Across acid, sphingomyelinase deficiency, or Niemann-Pick disease, type 1 mucopolysaccharide disease, and Pompe's disease, our established portfolio reflects our long-term commitment to the U.S., On slide 21 now, let me share an update on the key mid and late stage pipeline developments by using this slide from our December late stage pipeline review. Our immunology pipeline has progressed by having delivered most of amlitalimab's phase three program in AD and by LUN-secomix positive results in asthma and CRS with MP. In neurology, tolobrutinib is still under review with the EU for SPMS, for Atelabab in phase three for RMS and SPMS, and really Prubat in phase three for CIDP, the latter two with data next year. In rare diseases and oncology, Wayrills is advancing with its lifecycle management plans beyond ITP and the designations discussed earlier. Then we'll start for GD3 and Sarkalesa expanding with a subcutaneous formulation with recent positive EU recommendations. Our vaccines portfolio awaits future data across pneumococcal disease and other opportunities. Finally, on slide 22, let me cover the expected 26 and 27 key news flows. The remainder of this year, we expect the last phase three for amlitalimab in AD required for regulatory submission. We also anticipate multiple regulatory submissions based on data we already received last and this year as regulatory decisions for medicines and vaccines under review. Next year, we'll get the 2B data for provecimig in HS, followed by phase three studies of frexalamab in RMS, and reliprovant CIDP. My sincere thanks to all Sanofi R&D colleagues, and more broadly, Sanofi colleagues, who share my commitment to advance science in Sanofi, improve our pipeline from research to regulatory approval, and create new medicines for patients who need them. With this, I hand back to Olivier for Q&A.

Thank you, Oman. We'll now open the call to your questions. As a reminder, we would ask you to limit your question to one or two each. You will be notified when your line is open to ask your question. At that time, please make sure that you unmute your microphone or option two, submit your question by clicking the Q&A icon at the bottom of the screen. Your question will be read by our panelists. Now, we will take the first question.

The first question is from James Gordon from Barclays. James?

Hello, James Gordon from Barclays. Thanks for taking the question. One question was on monthly depictions. I've seen clinical studies to start in H2. But can you clarify, what are you going to co-formulate to be with an AD? And what would the development pathway and timelines look like? When could this come to market? And would it be quicker for asthma versus AD? That's the first question, please. And then the second question would be for Luna's second milk. So the phase two headlights look very encouraging. So your T-slip, IL-13 and asthma. But are you confident you've demonstrated a materially stronger profile than existing T-slip monotherapies such as Tezpar that are already on the market? Would you develop this with a study against Tezpar or just against placebo? So is this a much better product or really just another T-slip?

Yeah, so maybe, Jameson, thank you for your question. And maybe we start by the first question on Dupixent AED Manuela.

Yeah, so... I would ask Oumman also to compliment here. So first of all, your question was on the LCM profile of the PIGSINT. And we are evaluating strategic options, a broad set of strategic options as Olivier reiterated in his remarks. One is on IP, the other part is on formulations. Oumman will talk a little bit about the formulations. but there are broader options for the PIXINT that we're looking at and that we're considering, including co-formulation, including higher doses with a Q4W dosing to basically provide more options for patients and also elevate and enhance the patient experience. Hooman, maybe over to you.

Yeah, Manuela, thank you for that. Very quickly, James, I think just to be super clear, with the high days we're going into asthma, the development plan for that will be relatively conventional and we'll give you more details of that alongside our partner, Regeneron, going forward. Importantly, with a formulation we anticipate going relatively broadly, the formulation's been well worked out and will be germane and pertinent to many relevant depiction indications. the clinical development for those are just being worked out.

On the second question related to luncecumib, phase two result, differentiated product, Oman?

Yeah, so again, stated rather simply, we're enthusiastic by the results, as I've just called out, in severe asthma and CRS with MP, both of which strongly type 2 disorders and we've been excited by the results we've seen, albeit recognizing that these are early studies, Phase 2B studies. Just to be very specific, as you asked, a specific asthma study, I make three points. Number one is we comfortably hit our primary endpoint both statistically and clinically. in all cameras as anticipated. Number two, speaking to differentiation as called out on FEV1 and PROs, we were specifically differentiated. Number three, further details of differentiation in the overall population And in the relevant subgroups will be presented at a medical meeting in a relatively near future. I just want to caveat that while we are excited about LUNSECAMIG in the trio of codependent diseases of asthma, COPD and CRS with MP, you know, we remain thoughtful about how we go forward with these diseases as this was a relatively early study. But it does provide a foundation for our role in respiratory diseases. Next question.

Next question is from Florent Cespedes from Odo. Florent.

Good afternoon, everyone. Thank you very much for taking my questions. Florent Cespedes from OdoBHF. Two quick ones. First, on dupixent, in Q1, the drug was less impacted by pricing pressure in the US. Maybe could you give us more color on why this happened and how do you see the next discussions with the payers? And my second question is to follow up on luncekimib. Just like to know if you will wait for the phase two results on the high risk asthma next year before taking a decision, a launch of phase three program, or if you could decide in the near future for the next step for luncekimib. Thank you.

So first question, Manuela, on price pressure on Q1.

Thank you, Florent. So first of all, we're very pleased with DuPixent's continued strong performance, the 31% of growth that we have shown in Q1, which is largely positive. driven by underlying demand, strong underlying demand across established indications, but also driven by strong uptake at recent launches. As you rightly pointed out, the Q1 performance partly reflects a low basis of comparison due to higher gross to net price adjustments in Q1 2025. But again, if you are correct for that, the sales growth is largely driven by volume demand. you know that GTN fluctuates from quarter to quarter due to many different factors. Q1 in the US usually is highest because of the annual insurance benefit resetting. But to your question on payer pressure, we have a robust GTN strategy in place, which we continuously evolve to ensure long-term profitable growth while maintaining a favourable favorable patient access for the PIXEN in general. One thing to note, though, we expect a strong demand growth to continue. But at the same time, we expect some moderation in the second half of the year as recent launches will annualize.

So going to the question on Leucicumib and the development strategy.

Yeah, very straightforwardly, two bullet points. Number one is we do not anticipate waiting for the Aerolimpus results before we move forward. Number two is progression to phase three will solely be subject to obviously internal portfolio decision-making, but currently a regulatory conversation.

Yes. Next question is from Louisa Hector from Berenberg. Louisa?

Hi there. Thanks for taking my question. I wanted to follow up on the longer acting Dupixent, please. Could you comment on the actual technology? Is this with a partner? Are there additional payaways? And can we assume the financials with Regeneron remain the same? And perhaps just a question, could you stretch it even longer than every four weeks? And then second question, Olivier, great to have you on the call. So thank you. We've had you just for a few weeks as interim CEO, but obviously you have an impressive amount of experience at Sanofi and you've made a contribution to the significant transformation over the past five years. So the question for you is what advice might you give to Belen when she arrives in a week or so? Thank you.

On the first question related to the longer acting dupixent, I give it to Oumane. Yeah, I'll be short because we want to hear Olivier's response.

Louisa, thank you for your thoughtful question. Yes, the technology is pretty straightforward. It is with a partner, it is precedented, and we see it being used across the majority of dupixent indications.

Olivier. Thank you for your question, Louisa. First, I'm very happy to work again with Of course, Belen, with whom I have worked in the past and I know pretty well, I would be very cautious in the advice that I would give her. But the first one is to take some time to make the right diagnostic. I think the company has considerably changed in the last five to 10 years. The way the company has modernized is, of course, very impressive. I think in the last few years, we have gained a lot in terms of better prioritization, internalization of the company. We have also significantly increased our capabilities, notably in the US, in terms of marketing and commercial. Of course, it's going to be a period after the diagnostic where she needs to be decisive and knowing her. I know that she will make the right choices. She will examine, of course, and review the portfolio. I can tell you that in order that she gets prepared, who have prepared with my team a solid program so that she can, when she joins early May, be up and running from day one and clearly work on the topics that really matter for the future of Sanofi.

Next question is from Steve Canna from TDU Cohen.

Thank you so much. I am just curious why a year ago, Sanofi wouldn't speak to Dupixent LOE extension, but now includes slides in the deck. It seems that there are four possible reasons for this change. The first is that Sanofi now has more confidence, and I'm wondering why. Second, the outlook for the pipeline assets expected to form the next generation is unclear. Third, the LOE is nearer. Or fourth, a change in communication strategy may be related to the CEO change. In the absence of any other information, I think we have to assume it's the pipeline. I'm wondering if you would push back on that. Thank you.

So we can start maybe on the question that is related strictly to the LOE with our general counsel.

Thanks for the question. We've always been consistently saying that we have a very strong patterned portfolio. and that we tend to vigorously defend to a big extent, and that we expect it to go beyond the compound pattern of the ES, which is March 31. I think you see it on the slide for the first time because you see some other things there regarding the future of the Alliance, and it was just put in writing. We had the same question last quarter, and I answered it. Francois, on the slide, maybe?

Yes. No, Steve, I think that, anyway, there is a logic that we talk about it, because we get nearer to the LOE, and we see that there is a very strong appetite from the investor community to understand what's coming after the LOE of Dupixent. It's a major product for us, so I think we see that there is an interest, and we need to answer to the investor community. This has been done, by the way, perfectly aligned with our partner as well. Regeneron made some communication about it as well at JP Morgan. So there is a logic that we talk about it as well. So I don't think there is any defensive view on that matter.

Yeah, and the last point, Steve, and thank you for your question, is that it has nothing to do with the change of CEO Paul to the commitment in H1 to make an update on the Dupuy-Cent LOE. Okay.

Next question is from Sachin Jain from Bofa. Sachin?

Hi there. Thanks for my question. This is another one on the Dupuy extension slide, if I may. So I wonder if you could just provide a bit more detail On the right hand dp innovation column and where you are with other assets being discussed within the alliance of the aisle for receptor. And then level of progress isn't on discussions around whether each party would put other assets into the collaboration when we might hear on that. And I just wanted to go back to a prior question, there was a question on the Q4 week dp and whether you could extend beyond that one of you just address that. Just wondering whether Q4 week is enough of an extension relative to existing given the competitive landscape by the time you launch. Thank you.

So, Oumar, you take the two questions. Maybe you start by the Q4 week extension.

Yes, actually, thanks for the answer to the question. At the moment, we're very focused around the Q4 and we are confident that the Q4, you know, let's just take a step back. 1.4 million patients are dazed with DUP. It is the immunology molecule of the epoch. Moving to Q4 is an engineering innovation that will serve patients. So number one is, at the moment, we're focused on the Q4 and providing that in multiple indications, etc. And then we'll move forward on any further innovations. And you wouldn't expect us at this point to show our hand too much on those further innovations. And to question one, we work very closely along the Alliance, specifically with the teams in George and Len, on those various, I think you call them right-hand column indications, whether it's super duper or other molecules that we've talked about. And those molecules are being progressed together, certainly those during the Alliance. And we're excited about moving this forward. We'll tell you more about those over the next few years.

Next question is from Richard Vosser from GP Morgan. Richard.

Thanks very much. A couple of questions, please. Firstly, just on amlitalimab, I wondered if you could give us a bit of colour from feedback on physicians from AAD around the data you presented. And in particular, the carposi sarcoma events, any concerns you're hearing from physicians around use of amlitalumab because of those events? And then a second question also on the pipeline. You mentioned an outstanding... phase three decision on itopecumab. We've seen another IL-33 from a competitor have a couple of positive phase threes or maybe three phase three trials positive. Just what sort of impact does that have on your thinking around pursuing a further trial given the time required to do such a trial? Thanks very much.

For whom I met, we start by the last question on itechimab before moving to amlitimab. And maybe Manuela, you take the question.

Perfect. On number one, listen, we are, as you say, there's an outstanding question about the IL-33 molecule. We are in the midst of a regulatory discussion and discussions with our partners and we'll come forward relatively soon, I guess, with a decision, which will be a portfolio decision. Importantly, we take into account all the data, both in the private and public domain, regarding molecules that target the same pathway. And let me, why don't I just pick up the amlitalimab one as well, Manuela, as long as you're happy for me just to do that while I've got the microphone. With respect to amlitalimab, we, out of an abundance of desire to demonstrate the manifest benefit-risk of this molecule, we presented the data at AAD super clearly. Let me be clear on three things. AAD still represents a biological... an area which is substantially biologic underpenetrated with significant heterogeneity and disease. And there are opportunities for novel mechanisms of action. Point number one, the efficacy has been laid out. I won't repeat it, but case one, case two, sure. And Atlantis have been and show that there is no plateau effect to 24 weeks. And with Atlantis, there's an improvement up to 52 weeks. And thirdly, we've now put as much safety data in blinded and unblinded data that we've got in the public domain up to four and a half thousand patients approximately. And we remain confident in the, benefit-risk ratio of this molecule. You asked the question, and I'll be very succinct about physician and other responses. We've seen no impact on enthusiasm of physicians and pairs, particularly physicians and patients for this drug, based on the data we presented at AAD.

Next question is from Sarita Kapila from Morgan Stanley. Sarita?

Hi, thanks for taking my question. So you talked about expending the DUP LOEB on March 31. Which patents are you most confident in for extension? So is it the method of treatment patents? So potentially extending exclusivity to 2034? And then the second question was on Rila Pru Bhatt. Could you help us understand what's driven the one or two delays to the readout? One of your competitors has alluded to recruitment issues given the trial design and a lack of a part A component. So I was wondering if you could give us some more color, please. Thank you.

OK, maybe we start by the question related to different patterns. Thanks a lot. Picking one pattern out of tens of patterns is not a good testament to the amount of innovation we've done for the PIXN over the years. We have multiple strong patterns going up to 2045. We believe we have a very strong pattern portfolio and intend to vigorously defend all of them.

So now moving to Rémi Prébart, my quote man.

Yeah, very quickly. Really had a great set of phase two results in both patients with standard of care responsive and non-responsive. We moved straight to phase three. I think we've learned as we initiated those phase threes, what works best and what doesn't work best, particularly at the screening stage of those studies. And I'm pleased to say the recruitment's picking up. So as you articulated, we needed to learn something from the screening of those patients. And now we're moving on. we are optimistic about the impact ReallyProveArt can have on patient outcomes based on the totality of the data in the public domain.

This question is from Seamus Fernandez from Guggenheim. Seamus?

Oh, great. Thanks for the question. So first on the patent side, just hoping to get a little bit more clarity on how we should be thinking about the timing of potential resolution of the result. You know, typically we see something like a major series of settlements two to three years before. Can you say that you're proactively working on that kind of an outcome? to happen sooner rather than later? Or should we anticipate a standard extended process in the courts, particularly in the US? And then the second question is really, can you just update us on, I believe you were studying Lincecumeg in atopic dermatitis, hoping to get a better understanding of where or when we're likely to see those data, and if the data there happens to be something that you remain encouraged by, or if you're likely to move on. Thanks.

Maybe we start by the second question. Simus, thank you for your question. The onlucicimib AD human.

Yeah, thanks for the question. We've been delighted by the Lincecum results. And as I said, the triad of the respiratory disorders, our focus is in respiratory disease at the moment. We will make a decision on atopic dermatitis at a later point, but our priority is respiratory disease.

Now moving to the question related to Dubik's patent. Thanks. I'm sure your experience in following how other drugs have evolved over time. Reminder that this is a biologic. You're asking me about settlements and we are sitting here with a patent of 50... last patents in the US, none of which have yet been challenged. So if and if we wanted to give clarity to our investors of the strength, and even if we have people lining up to discuss, there is nobody at the moment because nobody's challenged our patents. Typically, this happens closer for biologics, this happens closer to launch. We do intend to vigorously defend all these patterns to the extent we feel at some point that people understand the strength of our case and we want to give people clarity. We will do that, but we are quite a way before that because we have not been challenged at this stage.

Next question is from Graham Perry from Citi. Graham?

Great, thanks for taking my questions. So just going back to the Q4 weekly depiction, can you just confirm if it's a hyaluronidase co-formulation, who the partner is and what commercial payaways you might have on that? And what formulation studies have been completed to date and if there's any public data or if you intend to share any public data on that? And then if there is more IP extension, you think the co-formulated Q4 weekly might give you on the asset overall. And then secondly, on the IL-4 receptor alpha, what are the milestones for that in terms of data points and what would be the threshold for a decision for the collaboration to invest fully in that project going forward, given it's already covered by the collaboration? Thanks.

Okay, so the first question on the Q4 formulation.

Yes, I can confirm that it is higher on the days with a partner. We won't disclose any more than that at this stage. And on the second question, we don't disclose the milestones for internal decisions around the R4 receptor alpha.

On the... Next, on the Q4W patents, Roy, any feedback?

Protect every innovation. I think the objective here is patient convenience, and we'll see what that means.

Next question is from Peter Verdul from BNP Paribas Exxon. Peter?

Thanks. BNP. Two questions, please. One on the pipeline, one on capital allocation. Hooman, sorry to label the point, but can we go back to the It's a Peck of Mad question? What are the exact go-forward plans? Because it seems to be dragging somewhat. I think we all thought that ERA 5.5 would have begun quite a number of months ago. So can you just clarify when, in fact, ERA 5.5 might begin recruitment or does the developments across the pond or across the channel at Astra sort of change your thinking about the commercial potential here? And then on capital allocation, just for Olivier or Francois, is 10 to 15 billion euros the right characterization of Sanofi's firepower for BD, given you want to maintain a AA rating? And given your comments and you clearly signaling that you're doubling down on rare diseases, is this the area where we should expect future BD? Thank you.

Roman, first question, I need to take him out.

So I just want to make sure that I was clear on the last question on the alpha result to alpha point. I just want to be clear that while we don't disclose the exact stage gates and milestones within the nature of the alliance, it is within the alliance and we are moving forward with it. So we will tell you more about that as we go forward. Pete, to your question about it, to pick them out. There's no slight of hand on it to pick them out. We have to get regulatory approval before and a regulatory opinion before we move forward. We have to align with our partner, Regeneron. I'd like to reassure everybody that it's high on our dashboard. Manuela and I on this side of the alliance are partnered and we will come back to you as soon as we can. As I said earlier, we're taking the totality of data, not just AstraZeneca's data is one, but there's a number of our 33 data points that we need to take into account before we move forward with COPD.

François, you want to take the question on BDM&A?

So on capital allocation, I said last time when we discussed full disclosure that we could invest up to 15 billion euros this year on retainer double A rating. By the way, it depends on what we buy. Because if we buy a commercialized asset, it would go probably even maybe potentially up to 10 billion more. If we were only buying phase one, phase two assets, it would be probably significantly less than that because it would weigh on our BOI. So we are looking at opportunities anyway. Time flies. So as soon as we get one quarter, the amount increases to a certain extent as well because we generate additional cash flow. And we have a strong growth profile as well, given that we grew double digit. In terms of areas and therapeutic areas, exactly as we did last year, you could see that last year we invested in three of our four main therapeutic areas, namely immunology, rare disease, and vaccines. So we are targeting... as a priority, I would say the same three therapeutic areas, while we don't eliminate either the possibility to invest in white spaces as we did as well last year, for example.

Next question?

Yes, the next question is from David Reisinger from Lirings. David?

Yes, thanks very much. Can you hear me?

Yes.

Great. Thanks for taking my question. I just have one. So, Francois, can you discuss the quarterly EPS progression ahead, including the impact of the Dupixent Alliance R&D reimbursement step down? Thank you.

Are you talking about Q1 or for the full year?

Looking out to later in the year when the reimbursement is eliminated.

Okay, so you know that we are coming to the end of the R&D reimbursement from Regeneron. We will have a negative impact on BOI of probably a good 400 million this year. We expected initially to have another negative impact of 800 million next year, which will be a bit less because we are anticipating. This is partly linked to the fact that since DuPixent is growing faster than we expected, we are anticipating a bit faster the end of the reimbursement so probably net around 400 million negative impact poi this year and maybe 700 million next year negative again on the top of what we get this year it may accelerate a bit depending on what we do this year with duplications but that's what is likely to happen We expect the balance to be fully reimbursed around Q2 2026. But obviously, this is a reason why it will have an impact on up to Q2 2027. You may remember as well that we said that in spite of that, our BOI will increase both in margin and in absolute value both in 26 and 27. So we'll be able to absorb it through our growth profile and profitable growth as well. Next question?

Yes, next question is from Matthew Weston from UBS. Matthew?

We took forever to get the unmute signal. Two questions, please. Thank you for taking them. In your opening comments, you said we should be concerned over the Kaposi sarcoma cases because the rates of malignancy are in the control arm. Kieran observed exactly the same, but said that sarcoma being mechanistic was a reason to kill the program. Why is he right and Kieran wrong? And then secondly, blueprint. A key element to acquisition, as I recall, was as a founder for Sanofi's standalone immunology commercial efforts beyond D&D. Now that there's a lot of talk about re-emphasizing the original line, does that mean you're de-emphasizing investment in Sanofi's standalone immunology?

So the line was pretty bad.

So maybe on the first question, on Amelie,

Yeah, Matthew, thank you for your question. I'm not, I wouldn't speculate on the decision-making within Taiwa, Kira and Amgen. From our own perspective, all I can tell you is that the benefit-risk of amlitilumab is differentiated. We are... consistently with the opinion that we bring that to patients. Just to be very specific, our rates of fever, chills and pyrexia are extremely low and lower than any other molecule in the OX40 pathway. Number two is that we've in, as I said, about 4,500 patients in blind and unblinded studies demonstrated two cases of Kaposi's, both of which were cutaneous, both of which are improving. And then number three is across our other patients, side effects and other issues, they're balanced across placebo and treatment arm. So overall, we remain confident at present around the value of amlitalimab in patients with, the benefit-risking patients with atopic dermatitis. Olivier, over to you.

Yeah, so blueprint has several dimensions. There is an immunology dimension, but there is also rare disease dimension. And this is why we have positioned it in our rare disease franchise, because we think that it's the best home for Blueprint. Next question.

So the next question is from Michael Lushton from Jefferies, who wrote the question. So on slide eight, you talk about innovation, new assets and new asset to leverage. the GV infrastructure, can you clarify all that links with BD and how you would work with both parties having an economic stakes? And then the second one is for Francois, is BD on pause until Belen arrives or is capital deployment in flight or on an ongoing strategy?

We want to start by the first question. I think we have been pretty active, including in the last few weeks on the BD side that you might want to compliment.

No, but I mean, obviously, we are looking forward to welcoming Belen in a few days, but business goes on in the meantime. So we have not stopped working. We have not stopped being active in the market, including in BD. So as Olivier said, we have been very active. And we have an acting CEO as well with Olivier. We have the board of directors and the entire management is totally mobilized to continue business while waiting for balance arrival in a couple of days.

Michael, on your question regarding any potential joint venture, I would say that, of course, everything is subject to discussion with Regeneron.

So the next question is from Simon Baker from Redburn. Simon?

Thank you very much for taking my questions. Two quick ones, if I may, please. Going back to Flan's question right at the beginning, we get a lot of debate now about the competitive landscape within immunology. I just wonder if you could... give us a little more detail on an indication by indication basis of how you're seeing that evolve. Overall, clearly, Depixent is outpacing our expectations, but any cull on that would be very helpful. And then a quick one for Francois. On net financial expense, you did guide for the full year being a little higher than last year because of higher debt. In Q1, it was a lot lower than we were expecting. So I just wonder if you could give us some pointers on the evolution and cadence of net financial expenses as the year goes on. Thanks so much.

Simon, thank you for the question. So, François, a little bit more color on the financial expenses.

On net financial expenses, you probably remember that last year, Q1 was before we received the proceeds from Opella. We had a relatively high level of net and gross debt, which is the reason why we had a level of finance cost that was relatively high. We gave a guidance at the beginning of the year on the fact that our finance costs would increase this year. And we mentioned immediately that would be subject to additional BD and M&A. We have not bought large assets in Q1, which is the reason why there was no impact in Q1. So it may be the NMNA for more significant amounts, if any, if any, I insist, may come a bit later in the years than maybe what we were anticipating when we were doing our budget. So you can probably factor the fact that there might be a little bit less than what we thought initially for the full year. That being said, I still expect an increase in terms of financing costs versus last year. That may be a bit more moderate than we saw due to some time delay in BDMA.

Manuela, on the broad question on immunology.

Yes, and I'll keep it short because we're almost at time. I think the question is a really good one. More competition in immunology. But at the same time, you also have to look at... how nascent some of these therapeutic areas still are. Let's just take atopic dermatitis as an example. We're barely above 18% advanced therapy penetration. And new entrants, new mechanisms of actions in all of these categories, more competitors, more players is actually helping to create more awareness and more adoption of advanced treatments. So that's what we're looking for. And there's definitely in all of those spaces, there's still significant unmet needs that we're trying to meet ourselves, but also with additional MOAs. So yes, more competition, but we're actually welcoming it.

Next question is from Rajesh Kumar from HSBC. Rajesh.

Hi, just a bit of clarification on capital deployment strategy. You indicated that If you were to buy a late stage asset, the firepower could be greater than 15 billion. Are you thinking of buying a late stage asset? That's the first question. Second question I have is, you know, obviously, Dupik, since you are going to work on life cycle management. You know, it's Becky Mab, we don't know what you're going to do. You're dependent on what the regulators are saying. You know, I'm literally Mab, you are a lot more confident than others. So if I take all of those, how are you thinking the R&D investments in these projects are factored in to your capital allocation framework? We truly appreciate what sort of risk weighting you put to these different, you know, scenario outcomes.

Rajab, thank you. And the first question on late-stage assets related to capital allocation.

Yes, Rajesh, I cannot comment on what we are looking at today because it's obviously confidential by nature. But I think we have a duty to look broadly at assets that make sense from a strategic point of view, from a scientific point of view, from a financial point of view. So we are looking at a certain number of assets, including late-stage assets. Although, we have said it over the last couple of quarters, our interest is more for early-stage assets. But we are not eliminating or discounting any opportunity either in late-stage assets. As I said, if we were buying late-stage assets or commercialized assets, as we did with Blueprint last year, Obviously, it adds some BOI, and as a consequence of that, it does give us a little bit more opportunity in terms of leverage. But so we, once again, we are looking at a fairly broad spectrum of assets, as we always do, and I think we have a duty to do that.

Rajak, maybe getting back to your second question, can you be a little bit more precise with your question?

On Dupixent lifecycle management? and allocation of resources.

Basically, you're going... Sorry. You're going to do some development expenditure there, right? For different formulations. And you're going to come up with a strategy to manage the life cycle. So you're going to spend money on R&D. Right. So how much of that was already factored into your earlier medium term R&D spending run rate and how much is incremental and new?

So, Oumman, how much is incremental, how much is already factored in our plan?

Yeah, much of it's factored in. And of course, it's part of the alliance relationship with Dupixent. And so that's pretty straightforward. Thanks, Rajesh, for the question.

Okay, so thank you, Rakesh, for this last question. So we had a very strong start to 2026 with double sales and EPS growth. Sales advanced by 13.6%, supported by pharma launches and recent acquisition. And business EPS was up by 14%. We obtained five regulatory approvals, all in immunology, achieved one positive phase three study readout for vanclustat in rare disease, and reported encouraging phase two data for nusiquimib in respiratory disease. And finally, we reiterated our guidance for 2026 and the commitment to deliver profitable growth. With this, I would like to thank you for the interest in Sanofi, and we will now close the call.