Sanofi announced this morning the acquisition of Ablynx:
• Ablynx is a Belgian antibody biotech company that has multiple compounds in the works:
o Compound targeting a rare blood disorder (aTTP) that has completed phase III testing and pending European & US regulatory approval for commercialization (fit with rare disease & Bioverativ)
o compound to treat RSV infections in phase II (fits with Sanofi’s vaccine portfolio)
o early stage antibody technology platform (adding to Sanofi’s R&D efforts)
• Close of the 3.9B euros ($4.8B) all cash acquisition of Ablynx expected fairly soon, in 2Q18
• The deal will be financed by bank credit and was approved by both boards
• Deal neutral to earnings in 2018 & 2019, then low-single-digits accretive thereafter
This is not changing our view of the stock, as any incremental future sales coming from those new drugs are offset by the cost of the deals near term. As a reminder, Sanofi was outbid by Pfizer on the Medivation deal, and by JNJ on Actelion. So far 2018 is starting to be a big M&A year for Sanofi