Good News for Undervalued Sanofi
The wide-moat drugmaker's cardiovascular drug, Praluent, which it has developed with Regeneron, enjoyed favorable results in a study.
Sanofi (SNY) and Regeneron (REGN) announced positive outcome data for their partnered cardiovascular drug Praluent, supporting our above-consensus sales estimate for the drug and undervalued stock call for Sanofi and slightly undervalued stock call for Regeneron. We had expected the positive data, so we don’t expect any major changes to our fair value estimates for the companies. Further, the solid data reinforces both companies' moats by strengthening the value of a key drug in their portfolios.
In the large Odyssey study, Praluent statistically significantly reduced the risk of MACE (the primary endpoint based on a composite of heart attack, ischemic stroke, death from coronary heart disease, or unstable angina requiring hospitalization) by 15% (similar to the benefit seen from Amgen’s Repatha in a different outcomes study of slightly less sick patients) with a strong p-value of 0.0003. The study also showed that Praluent caused a reduction in all-cause death. In the patient population with LDL cholesterol above 100 mg/dL, the reduction in all-cause death was an impressive 29%. Importantly, no significant safety signals were seen across the study of almost 19,000 patients. At the American College of Cardiology meeting, where the data was presented, 62% of the doctors surveyed stated they would change their prescribing habits because of the data.
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Damien Conover does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.