Regeneron, IGM Biosciences Shares Up Big on Sanofi Deals

Stock of big French drugmaker fails to gain on announcements

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Mar 31, 2022
Summary
  • Regeneron advances 4%, IGM 67% in past week.
  • Sanofi boosts revenue expectations for Dupixent to $14 billion at peak.
  • Drug slated to be submitted for 11 new indications by 2025.
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A week filled with promising announcements failed to jump-start Sanofi SA's (

SNY, Financial) shares, but it did for the two companies it’s working with.

First, the French pharmaceutical giant boosted its peak sales projection for the drug Dupixient, which is used to treat eczema in both adults and children. Investors flocked to Sanofi’s partner on the drug, Regeneron Pharmaceuticals Inc. (

REGN, Financial), whose stock has risen about 4% since last Friday’s close to around $705 and has climbed more than 12% year to date.

Dupixent has been a boon for the two companies. Last year, the drug contributed about $4.2 billion to Sanofi’s sales and about $1.8 billion to Regeneron’s. Fierce Pharma reported it was thought that its annual revenue would top out at about $11 billion, but Sanofi now thinks $14 billion is a more realistic figure given late-stage clinical data that would likely expand the use of the medication.

The drug has already added new Food and Drug Administration approvals for use in asthma and chronic rhinosinusitis with nasal polyps. Going forward, Sanofi expects 11 new submissions for the drug "across indications and age groups" by 2025.

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Caption: Investors have to be pleased with the gain in share price enjoyed by both IGM and Regeneron after deals with Sanofi this week.

"This truly unique medicine is only at the beginning of its journey to helping potentially millions of patients," Sanofi's head of global specialty care, Bill Sibold, said in a statement this week.

Dupixent is part of the vision for the company that was laid out when CEO Paul Hudson joined in 2019. His “play to win” strategy involved abandoning areas where the company was having problems and putting its chips on the best opportunities.

IGM Biosciences Inc. (

IGMS, Financial) shareholders have to be pleased with the 67% gain the stock made this week after the company announced it had signed a development pact with Sanofi, under which the Mountain View, California-based biotech will get $150 million to apply its antibody technology platform against cancer and immunology diseases. If milestones are met, IGM stands to pocket another $6 billion.

For each cancer program, IGM will pay the related costs through approval of the first biologics license application for the FDA or the European Medicines Agency. Once the drugs are approved, Sanofi will become responsible for developing and commercializing the treatments.

IGM will also lead research and development for the immunology/inflammation target programs, with Sanofi handling future developments and associated expenses.

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I am/ we are currently short the stocks mentioned. Click for the complete disclosure
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