Sanofi remains neutral: pipeline rebuild and post-Dupixent growth still need to be proven

Overview

This report is Goldman’s company research and 2Q26 earnings preview for Sanofi. The core conclusion is that although Sanofi has strong commercial execution, especially with Dupixent still as the main growth pillar, the company remains in transition after multiple R&D setbacks. The first earnings run under the new CEO is more likely to provide high-level strategic commentary than a full strategic re-rating. Goldman maintains a Neutral rating and cuts the 12-month target price from €89 to €84.

Core views

Goldman believes Sanofi’s short-to-mid-term investment case depends on three things: first, whether Dupixent can extend franchise value through patent defense, long-acting formulations, and lifecycle management; second, whether lunsekimig, frexalimab, duvakitug, efdoralprin alfa, and early immuno-oncology and gene therapy programs can rebuild market confidence in the R&D engine; and third, whether management can use disciplined, value-accretive BD/M&A to fill portfolio gaps. Current valuation is not sufficient to offset these execution and pipeline risks, so neutral is maintained.

Analysis framework

The report integrates the 2Q26 earnings preview, product sales forecasts, FX impact, company guidance, key pipeline readout timelines, Dupixent lifecycle management assumptions, probability-adjusted sales peak assumptions, and updated DCF valuation analysis. Goldman’s model updates include FX, management commentary, prescription trends, the €2.3bn bond issuance, a lower success probability for riliprubart, a higher success probability for tolebrutinib, assumptions for Dupixent biosimilar entry and pricing pressure starting in 2033, and a reduction in terminal growth rate from 0% to -2%.

Methodology notes

• Valuation methodsDCF

  cash flow discount valuation with terminal growth-rate adjustment

  The report says that biosimilar entry for Dupixent and pricing pressure from 2033 onward were incorporated into the model, and that due to R&D setbacks, terminal growth was reduced from 0% to -2%, with a combined approx. 4% negative impact on DCF valuation.

• earnings previewGSe vs consensus

  Goldman forecasts versus market consensus

  Goldman expects 2Q26 net sales to be about 1% below consensus, with business operating income and business EPS broadly in line with consensus, and expects FY26 CER sales to grow in the high single digits and business EPS to slightly outpace sales growth, with guidance reiterated.

• pipeline assessmentprobability of success

  success probability and peak-sales assumptions for R&D programs

  The report uses unadjusted peak sales and PoS assumptions for lunsekimig, frexalimab, itepekimab, duvakitug, and efdoralprin alfa, to assess their potential contribution to medium-term growth and investor sentiment.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Sanofi / SASY.PA

  Company and stock coverage

  Strengths

  Commercial execution remains strong, and products such as Dupixent and Altuviiio continue to contribute growth, with a balance sheet that provides some M&A capability.

  Weaknesses

  Repeated R&D setbacks have weakened market confidence, and the post-Dupixent growth path still needs validation.

  Comparison

  Goldman expects 2Q26 sales to be slightly below consensus, while business EPS is broadly in line with consensus.

  Risks

  Pipeline failures, intensified M&A competition, Dupixent biosimilar pressure, and valuation upgrades lacking fundamental support.

• Dupixent

  Core growth pillar and key lifecycle management focus

  Strengths

  It remains central to Sanofi’s investment story; 1Q26 sales were about 7% above consensus and contributed most of the Group’s revenue over expectation.

  Weaknesses

  The business is moving into a higher base phase, with expected biosimilar entry in 2033-34 and limited long-acting differentiation potentially limiting long-term value.

  Comparison

  Goldman’s 2Q26 Dupixent forecast is about 1% above consensus.

  Risks

  Failure to materially extend patent exclusivity, and long-acting formulations offering dosing convenience rather than efficacy or safety advantage.

• R&D pipeline

  Source of post-Dupixent growth and sentiment repair

  Strengths

  lunsekimig, frexalimab, duvakitug, efdoralprin alfa, and early-stage PD-1×IL-15 and gene therapy programs provide multi-layered optionality.

  Weaknesses

  Recent events around itepekimab, amtililimab, tolebrutinib, and rilipribart indicate high execution uncertainty.

  Comparison

  duvakitug is viewed as a potential key upside asset, but data is expected in 2H28 and beyond, and economics are shared with Teva.

  Risks

  Late-stage clinical readouts weaker than expected, stronger competitor data, and market share or peak sales below model assumptions.

• M&A/BD

  External innovation and growth-completion lever

  Strengths

  Management is reported to have up to €15bn deployable in 2026; bolt-on commercial-stage deals may quickly accrete earnings, while clinical-stage bolt-ons may offer higher long-term returns.

  Weaknesses

  Rising demand for quality assets across the industry could push asset prices higher, especially in immunology.

  Comparison

  The report views M&A/BD as one of the key upside levers.

  Risks

  Overpriced deals, integration failure, clinical asset failure, or value-dilutive capital allocation.

Key data

• RatingNeutralGoldman maintains a neutral rating on Sanofi.
• 12-month target price€84.00Target price cut from €89 to €84.
• Current price€75.81SASY.PA current price as shown in the report table.
• Implied upside10.8%Based on €84 target price and €75.81 current price.
• 2Q26 net sales forecast€10,678mnGoldman forecasts around 1.3% below consensus €10,823mn.
• 2Q26 Business EPS forecast€1.88Broadly in line with consensus €1.88.
• 2Q26 Dupixent sales forecast€4,452mnGoldman forecasts about 1% above consensus.
• M&A/BD runway available for deals€15bnThe report sees M&A/BD as an important upside driver.
• Market capitalisation€91.2bn / $104.4bnDisclosed in Key Data.
• Enterprise value€103.9bn / $119.3bnDisclosed in Key Data.

Impact & implications

For investors, Sanofi’s commercial base remains defensive, but valuation repricing in the near term requires clearer catalysts. 2Q26 results are not expected to deviate materially from consensus, so market focus should shift to the new CEO’s views on R&D priorities, capital allocation, Dupixent lifecycle management, and M&A/BD. If key pipeline readouts improve or M&A creates earnings accretion, sentiment may recover; if late-stage pipeline setbacks continue or the stock rises disconnected from fundamentals, risk-reward deteriorates.

Risks

• A stock repricing without clear earnings upside, pipeline de-risking, or commercial catalysts could reduce future upside and increase disappointment risk.
• Another late-stage pipeline failure or clinical data weaker than expected would further lower medium-term growth visibility.
• Dupixent faces biosimilar entry and pricing pressure around 2033-34; if lifecycle management is insufficient, long-term cash flow could come under pressure.
• Increased competition for M&A/BD assets could reduce transaction returns and raise capital allocation risk.
• FX is expected to affect 2Q26 sales and EPS by -1.7% and -2.2%, respectively.

What to watch

• Sanofi’s 2Q26 results released at 6:30am BST on 2026-07-30.
• The new CEO’s initial comments on strategy, R&D priorities, capital allocation, and M&A/BD.
• Dupixent 2026 growth trajectory, patent defense, Q4W long-acting formulation, and lifecycle management updates.
• Detailed Phase 2 data for lunsekimig to be released at the 2026 ERS meeting.
• Follow-on development path decisions for itepekimab in COPD.
• Frexalimab Phase 3 readouts in RMS and nrSPMS, expected in 2H27 and 1H28, respectively.
• Phase 3 data for duvakitug in UC and CD, expected in 2H28 and 2H29.
• United States filing and regulatory progress for efdoralprin alfa in 2H26.