Sanofi to Divest 16 Consumer Health Brands to Stada in Strategic Portfolio Simplification

Compiled and Translated | Fan Dongdong

Recently, Sanofi decided to divest a portfolio of consumer brands sold in Europe. On Monday, the two companies announced that Sanofi will sell assets for 16 consumer healthcare products to Germany's Stada Arzneimittel.

The transaction is expected to be completed in the third quarter of this year. Stada will acquire the registration, trademark, and commercial rights for the aforementioned products in 13 countries, encompassing key markets such as France, Germany, Italy, Poland, and Spain, which account for the highest sales. In a press release, Stada stated that the divested product portfolio comprises cold and flu medications, skincare products, and dietary supplement brands.

As part of this restructuring plan, Sanofi has been implementing cost cuts to prioritize the development of its immunology blockbuster, Dupixent. The company intends to streamline its consumer healthcare business and ultimately spin off the division into a standalone entity. Julie Van Ongevalle, head of Sanofi's Consumer Healthcare division, said in a statement on Monday, "Streamlining the CHC portfolio is a key component of our strategy to focus our resources and efforts on areas that deliver the greatest value."

In a statement, Stada announced that, following a similar transaction with GlaxoSmithKline last year, the acquisition of Sanofi brands—including Mitosyl ointment, Silomat cough medicine, and Frubiase nutritional supplements—will strengthen the German company’s regional sales network in Europe. Sanofi expects that the divestiture of these brand assets will not impact its workforce in the European market. Stada also stated in its press release that the transaction with Sanofi does not involve the transfer of personnel or manufacturing equipment.

The two companies did not disclose specific financial details, but Yahoo Finance cited a source with extensive deal experience as estimating the transaction price at between €120 million and €140 million (approximately $144 million to $168 million). In a statement, Chief Executive Officer Peter Goldschmidt said the transaction would consolidate Stada’s position as a specialist in generics and over-the-counter (OTC) medicines, cementing its status as a “top-five player in the European consumer healthcare market.” Volker Sydow, Head of Consumer Healthcare at the company, added that by investing in the Sanofi portfolio, including “digital channels” and “product innovation,” Stada aims to breathe new life into these brands “within their respective market segments.”

Compared with Stada's gradual expansion in the consumer healthcare sector, Sanofi is actively "slimming down," aiming to eventually spin off its consumer healthcare business as an independent company from the group. As part of CEO Paul Hudson's revised corporate vision, Sanofi announced this strategy in December 2019. The company plans to reduce annual expenses by €2.5 billion by 2022 and focus more on growth drivers in core businesses such as Dupixent and vaccines.

Regarding the progress of the reform, a Sanofi spokesperson stated that, as of now, Sanofi still expects to "complete this transformation by the end of 2022".

References:

1.Sanofi offloads 16 consumer health brands to Stada amid CEO Hudson's refocusing effort

2.Sanofi sells portfolio of regional consumer brands to Stada