Sanofi (SAN) Earnings Call Transcript & Summary

[Interpreted] Good afternoon, ladies and gentlemen. I hereby declare open the Annual General Meeting of our company. In this context of health crisis that we have right now and with a view to protecting our shareholders, our employees and our suppliers, exceptionally, this AGM will take place in camera that is in the physical absence of our shareholders as provided by Article 4 of Ordinance 2020-321 of 25 March, 2020. I would like to thank all the shareholders who cast their vote remotely ahead of the AGM, and I should like to thank all those, now, following this live on the Internet. Indeed, the webcast will remain available after the transmission. Next to me, I have Paul Hudson, our CEO; Jean-Baptiste de Chatillon, the CFO; and Philippe Peyre, Secretary General. Patrick Kron, who chairs the Compensations Committee, is also with us, and he will introduce the highlights of the compensation policy. We now need to appoint the officers of the assembly. I would like to appoint Philippe Peyre as Secretary of the AGM and under Article 8 of the decree of 10 April 2020, I asked Philippe Peyre, Secretary General of the company; and Jean-Baptiste de Chatillon, who's the CFO, to act as vote takers, which they accepted to do. We also have our auditors following this live on video conference; and Mr. [ Rafael Pero, ] who is a Judiciary Officer is also attending. Philippe, you have the floor.

[Interpreted] Good afternoon, ladies and gentlemen, because it is impossible for shareholders to be physically present because of the sanitary precautions implemented by the authorities in fighting COVID-19, shareholders were asked to cast the vote remotely ahead of the AGM, either by post, using the form or on the Internet. The shareholders that gave proxies were taken into account. And based on the attendance list, shareholders present or represented, represent more than 1/5 of the shares with voting rights. Altogether, they had 817,428,567 shares or 67.37% of shares with voting rights. As the quorum is final, the AGM is in a position to vote legally. We have, on the desk, the articles of the company, a copy of the convening letter sent to nominated shareholders. We have copies and acknowledgments of registered letters sent to the auditors. We have a copy of the gazettes of date -- on date 13 March, 2020, with the meeting notice. We have a copy of the [Foreign Language gazette and the BALO dated 8 April 2020 with the convening notice. We have the reports of the auditors, the attendance list, the proxies of shareholders that are represented and the list of documents that were made available to shareholders at the headquarters in the legal time frame and sent to those who requested it, and we have the agenda on Page 6. Detailed explanations on the resolutions are in the Report of the Board, which is available on the website and indeed on Page 7 of the convening brochure. No draft resolution or new item of the agenda was presented by shareholders, and you finally may have received either by BNP Paribas or your financial intermediary all documents required by law.

[Interpreted] Thank you, Philippe. Ladies and gentlemen, dear shareholders, for the first and hopefully, the last time, this AGM will take place in an extraordinary format that is on a virtual format without this valuable exchange we have with shareholders, without being able to take your questions and having already received your votes. Nonetheless, under this form, the AGM is an opportunity for us to tell you about the performance of last year, but also, and more importantly, current circumstances, the present situation and the situation of the present and future situation of Sanofi. A few words about 2019, even though a view of all the events that have taken place since the beginning of the year. This is the world before. Important events have happened that are defining moments for this company and just via confidence, a return to growth after several years of low growth or indeed negative growth because of pressure on diabetes prices in the United States. Sanofi was able to return to growth -- organic growth, especially because of the launch of new products, dynamic vaccine activity and its sustained presence around the world, especially in emerging countries. We also have a new CEO, having with the retirement of Olivier Brandicourt, Paul Hudson joined our group, a seasoned professional with great international experience in many territories. He clearly showed his leadership and has already left his mark on the company. One of the first achievements of Paul Hudson was to propose to the Board of Directors, which accepted it, a new strategy based on defining priorities for the future of the group. It's based on 3 sources of growth, DUPIXENT, vaccines and a portfolio of products and R&D in a number of therapeutic areas, oncology, rare diseases, urology, hemophilia and vaccines. Greater selectivity of R&D projects is indispensable. We have to keep only those that are likely to make a significant positive contribution to the health of patients. Such selectivity will improve research productivity, which accounts for 16% of our sales, more than EUR 6 billion. That strategy is based on a simplified organization. We have 3 main departments, Specialty Care, General Medicines and Vaccine and a CHC unit, which, in order to be more effective, should be more autonomous within the group The working of the company should also improve. A clear definition of priorities should make it possible to have clear-cut responsibilities and promote initiatives. Our digital strategy and ambition strategy should also reinforce our abilities, both in terms of growth and nimbleness and effectiveness, and we already have started a plan to keep costs under control. All this together should enable the group to pursue more sustained growth, generate growing profits and as well as investment capacity so as to finance not just R&D, but also opportunities for external growth, as was the case with the purchase of Synthorx in early in 2020. Early on, in Q1, we have -- we are bearing the fruit of this strategy. Paul and Jean-Baptiste will tell you more about this in a moment. A few words now about the present situation. Health crisis caused by the emergence of COVID-19 is exceptional, both in terms of magnitude and its brutality. Sanofi decided to step up to the plate very early on, both in terms of research, looking for new vaccines and clinical trials to test out therapeutic solutions. This was massively increased. The manufacturing of essential products was significantly increased as well. And large donations were made to unburden the French health care system and help medical workers. And finally, Sanofi, in the spirit of responsibility, decided to waive any kind of government assistance. And we should like to thank and congratulate, in your name, all employee -- all company employees who've shown remarkable commitment, working relentlessly to bring solutions to various challenges encountered in this exceptional situation, some of our medical staff and paramedical staff also join the frontline, thanks to this remarkable commitment under the leadership of Paul Hudson and the com ex. The company has -- was able to show around the world that it was a key link in the health care supply chain in France and around the world. This crisis should prompt all stakeholders to think about what should be done in the future to prevent future vulnerabilities. First of all, it is necessary to equip countries to face such crisis. This comes at a cost. But like all insurance premiums that we pay seem to be expensive when nothing happens, the cost of equipment should be borne, not just to, of course, dimension the systems to crisis levels. That would be absurd, but to be able to deploy adaptive resources. And that would come at a fraction of the cost caused by human and economic disaster caused by the pandemic. But science may be international. It shouldn't be confiscated by one country or another for indirect or direct purposes. The temptation may exist for various reasons, especially where behind science, the economic or political future of some units are at stake. And in this field, in this respect, it is indispensable that Europe should have its own R&D and manufacturing capacities. And in this context, the group decided before the COVID-19 crisis to earmark 6 plants and use them for the manufacturing of APIs, make it an independent company, even though we would keep a significant share in that unit. The future of health care systems should be considered globally. All resources, both public and private, should be mobilized. The network of care in cities and hospitals and clinics and teaching hospitals should form a fabric that should not be considered a silo to have an industrial vision. We have to have an overall industrial approach because we have to face the challenges of health care, while taking into account the needs of research, which is now stepping up remarkably at a time when the manufacturing of the products in therapeutic solutions are all the more necessary that there's a worldwide competition around this. It is also necessary to step up the implementation of digitalization to bring more effectiveness in terms of prevention, but also in cost control. Why not promote, whenever possible, to have such agreements as we had with GSK for one of the vaccines against COVID. So we have to break silos. We have to create fluid network. We have to look for solutions, cooperative solutions and mobilize creativity. This is indispensable for the future of all health care systems regardless of organizational principles. This is indispensable if we are to provide care and cure in best possible conditions. And your company is doing its best bit in this respect. And as you can see, in spite of circumstances, we can be confident about the few future of the company. A few words about the governance of the company. We have, of course, the Board of Directors and up on the screen, you have all Directors. We will be making a few changes this year. We have 2 of our Directors leaving the Board. Suet-Fern Lee, who joined the group back in 2011 and Claudie Haigneré, who was a Director since 2008. And in order -- while having spent 12 years now on the Board, she has to step down. And we've appointed 2 new Directors, Rachel Duan, who spent most of her career in China, even though she was trained in the U.S. and for many years, she was running GS in China and now, she -- well, she runs the Chinese GE business. And then we have Lise Kingo, who spent 26 years with Novo Nordisk, one of our competitors, and who, for the past 5 years, was CEO of the Global Compact, which is the UN agency supporting sustainable growth and both Lise and Rachel will make their contributions, one, of course, with her knowledge of China and Lise with knowledge of the pharmaceutical industry. And of course, with a deep knowledge of RSE issues. So we have these new Directors. And then we propose to renew all appointed number of new Directors. Paul Hudson, of course, was co-opted by the Board on 30th of October last year; Laurent Attal, who has been Director since 2012; Carole Piwnica, who was -- has been Director since 2011. Diane Souza, who's been on the Board since 2016 as well as Thomas Südhof. So the idea here is to renew these 4 Directors. And the Directors, there are 16 of them on the Board. We have a -- well, very consistent group with a large majority of independent Directors, 11 out of 14. We have 2 Directors representing the staff, and they do not count for gender parity purposes. We do have 43% of women on the Board. We have an international balance. Well, between the French and international, 50% of our Directors are non-French. And the main purpose of the Board this year was to pursue the strategic survey of the company first under Olivier Brandicourt, but now, of course, with Paul Hudson, monitoring the makeup of the Board, depends, of course, on new requirements. And in particular, for the past few years, we have strengthened our scientific and pharmaceutical expertise, but also strengthened our skills in terms of digital technology and RSE. The Board was very active in 2019. As many as 13 board meetings, including 2 executive sessions, executive sessions take place in the absence of top management, and 2 strategic seminars. And most of the activity consisted in considering the overall strategy, looking at succession issues and compensation issues, but also specific strategies in a number of areas, including China and emerging markets, renegotiating our agreement with Regeneron, revisiting all the group's activities and then considering possible opportunities, both for external growth and disposals. And attendance was quite high throughout. Now as you know, around the Board of Directors, you have 5 specialized committees under French law. Committees are instruments where decision-making is as it were prepared, but decisions are made by the Board itself. The committees don't have, sort of, legal autonomy. The Audit Committee is chaired by Fabienne Lecorvaisier. It's made up of independent Directors. It reviews annual, quarterly and half year results. We go through the budgets and internal auditing. Regarding the Compensation Committee, this is chaired by Patrick Kron also has 4 independent members. And in 2019, it mostly focused on issues of compensation package for the CEO, the Chair of the Board and the com ex, but also revisited the employee shareholdership plan. The RSE that is a committee that was appointed last year, worked on, of course, the succession plan, not just for the CEO, by the way, also for the com ex. It considered the membership of the Board and its committees. It also so nominated candidates for board membership, monitoring issues on governance. But of course, mostly it is for it to assess the work of the Board itself. Finally, the Strategic Thinking Committee, the Strategic Committee is made up of 4 independent Board members, looking at operational issues, in particular, the partnership with Regeneron, but also possible disposals and/or acquisitions. And then an in-depth review prior to a meeting of the Board on the issues of priorities and resource allocation. And finally, the Scientific Committee, created 2 years ago, chaired by Thomas Südhof, 3 -- 4 members, including 3 independent Board members, and it reviews all the R&D projects of the group. And last year, it looked at diabetes and oncology. It also considered the strategy for gene therapy and also looked at a number of our partnerships in diabetes with Hanmi and Lexicon. There were 2 strategic seminars that examined in-depth of our digital strategy, but also our priorities in terms of R&D. Regarding the share performance of Sanofi, you have on this slide, the share price variations since last year. A year ago, we can see that overall, well, initially, the Sanofi share price was somewhat challenged, but now it has redressed considerably. It's well ahead of the CAC 40, which is down 21.4%. Of course, it's best to compare our performance with that of our counterparts in the pharmaceutical industry. We have halfway between the European and the American performance. But you can see on the slide that the performance of well, the share price over the same period was greater than average, and greater than the median, looking at all the benchmark. The sample of pharmaceutical companies that we monitor, and then that had not happened for a number of years. Regarding the dividend, we are proposing a dividend of EUR 3.15, so up 2.6% compared with last year. For a number of years, we've had a policy of moderate but sustained growth of the dividend in line, of course, with our financial performance. And we certainly hope to be able to pursue this policy in the future as we have in the past. Finally, international diversified shareholder ship shows that the weight of institutional investors is 77%, and it is evenly divided between various parts of the world with very little change compared with last year. So that's for governance. And I'll give the floor to Patrick Kron who chairs the compensation committee and will tell you about the work of that committee and the decisions adopted by the Board.

[Interpreted] Thank you, sir. Good afternoon, ladies and gentlemen. As Chairman just said, it is for me to comment on the activity of the compensation committee for the year 2019 and more specifically, the issue of compensation for corporate offices. Starting with compensation of our Directors. This is resolution #12. Subject to approval by the AGM proposes to adjust the Directors' fees as follows. We maintained the fixed compensation at EUR 30,000. We increased the variable share related to actual attendance to meetings by about 10%, with a view to remain competitive, especially vis-à-vis foreign Directors, whose number has increased. Variable compensation there has not been increased since 2010. Next slide is about the compensation package for the Chairman of the Board. So there is only a fixed amount, no variable part, no shares, no free shares or other forms of bonuses. The following slides, we call the policy of 2019 and 2020. For 2019, the compensation of the Chairman of the Board was EUR 700,000 plus access to a company car for 2020. We propose to increase this fixed compensation to EUR 800,000. We should remind here that, that amount had not changed since the appointment of Mr. Weinberg in 2010. On this slide, you see the compensation policy for the CEO. No changes there compared with previous years as approved in previous AGMs with the exception that the CEO will only receive performance shares. Whereas in the past for the CEO and the CEO alone, there was a combination of performance shares and stock options. So that means that now the CEO's package is exactly in line with that of other members of the management team. Looking now at the details of Paul Hudson's compensation package. Paul was appointed as a CEO on September 1, 2019. Fixed compensation has been set at EUR 1.3 million compared with EUR 1.2 million for his predecessor. Again, that amount had been set back in 2015 and not changed since that date. And there's a fairly logical adjustment. The amount here has been worked on, on a pro rata basis. And it works out to EUR 433,000 for a 4 month period. The variable part was, by convention, set at target, i.e., 150% of the fixed amount or EUR 650,000 for 2019. No performance shares were granted. However, the company accepted to compensate for what Paul Hudson was losing at his former employer when he joined Sanofi. Actually, the actual amount is 50% of that. And that is as phantom stocks. Phantom stocks are bonuses that are worked out based on the share price and are subject to, of course, a number of clauses, attendance, of course, presence continuous presence and a number of performance requirements based on net business income, cash flow, and TSR, total shareholder return for Sanofi shareholders compared with a benchmark. We have all the details on Slide 25 before -- on your screens. There are 50,000 phantom stocks. Half of them will be invested in March 2021 on the basis of the performance in 2020 and the other half in March 2022, based on the performance of the 2 years 2020 and 2021. Regarding Paul Hudson's compensation package for the year 2020, you have, of course, the fixed part, EUR 1.3 million, as we just said. Regarding the variable part, no change -- no structural change compared with previous policies. The variable part is anywhere between 0 and 250% of the fixed part. The target being 150%, that is if all targets are met being neither over short or no under short. And assessment of the performance is, as in the past. You have 40% based on objective targets, clearly quantified and 60% is based on specific objectives that you have there. And you have 1/4 of these specific objectives is related to environmental and social corporate responsibility. We have planned a 75,000 performance shares for 2020, related, of course, subject to net business income, cash flow and total shareholder return compared to a benchmark of comparable pharmaceutical companies. The following slide deals with the variable that is the bonus of Olivier Brandicourt for the period in 2019. He was still in the company from January to August. That was worked out to be 96.75% of target, i.e. a pro rata bonus of EUR 1.161 million, and that is the mathematical result of 96.75% of 150% of the fixed compensation over an 8-month basis. On the following side, you have the overall view of Olivier Brandicourt's compensation package, fixed part EUR 800,000. That's 2/3 of EUR 1.2 million. The variable part I just listed the amount and then 220,000 stock options with the exercise price at EUR 76.7 and the 50,000 performance shares that were already decided in the past. At the time when this mix of stock options and performance shares were granted, the actual timetable and the terms of conditions of Olivier Brandicourt's departure had not been finalized. Olivier Brandicourt decided to call his pension, to decide to retire, therefore, that means that he will be in a position to keep the plans that were already decided. But because of the conditions of the departure, there's no particular bonus or severance bonus, in particular, the 2-year of fixed variable compensation that were in the contract but not applicable when the CEO retires. And as of September 1, 2019, that is when he officially decided to retire, the additional retirement plan is also implemented as provided by the contract. So these are the elements of the compensation package that is subject to the vote of shareholders. You have the compensation package for the Directors, for the Chairman of the Board and for the CEOS, Olivier Brandicourt and Paul Hudson for 2019 and Paul Hudson for 2020. Thank you.

[Interpreted] Thank you, Patrick. And now we'll give the floor to Paul Hudson, who will introduce the group's new strategy Play to Win.

[Interpreted] Good afternoon, ladies and gentlemen. Thank you for taking part in this necessarily special virtual general meeting. Unfortunately, and I'd like to apologize for it, I do not speak sufficiently good French to make all my presentation in your language. However, I would like to start with a few introductory comments in French. We are going through an unprecedented global health crisis, and no one can claim that they can respond to the crisis on their own, including the Chief Executive Officer. In this very special moment, for society and for companies, I would like to tell all shareholders that you can be deeply proud of the women and men who make up Sanofi everywhere in the world. Here, I have a special thought for all the industrial affairs team that carried on going to their work each day and every weekend. I am humbly honored to be able to represent and the whole team on a daily basis, as Chief Executive Officer. Our role as a health care player has probably never been so important for society and health care systems. Sanofi is stepping up to the plate in these difficult times. I joined Sanofi with the belief that this company had great potential to do great things. The crisis that we're undergoing only confirms my analysis. Sanofi, a French, European and global company has all the ingredients, all the items to change the practice of medicine to the benefit of patients. It is with -- with this goal in mind that we've established the group strategy for the next 6 years. And I will now continue in English to present this strategy. So thank you. Thank you again. Maybe I could add to what I tried to express in French that there is tremendous pride across our great organization in the work that has been done to try and play an active leadership role in COVID-19. I have never seen an organization respond quite this way, and I've never experienced the pure sense of purpose that our organization has. It's been a privilege and humbling, as I mentioned, to be part of this. You would be amazed at how our people have pushed themselves to do what is right on every single day. And I'll share more about that a little bit later. So our strategy that we laid out last December falls into 2 parts. There is the here and now where we focus, we make decisions. We prioritize. We grow our winning assets and medicines, and we grow our margin. And over the period of time, we will improve our R&D productivity. We will launch transformative medicines that will change the practice of medicine, and we will become much more proficient at deploying agile resources to match opportunity. We laid out also at the Capital Markets Day. There were 4 key pillars for how to Play to Win in our organization, focus on growth, and I'll share more about that in a moment; lead with innovation, and we've had breaking news even as recently as last Thursday; accelerate our efficiencies and replace where we can and use and leverage tech to be more productive or to get more out of what we have; and then finally, reinvent how we work. We talked last December about how to accelerate our move to digital literacy and adoption. Well you can see just in the last few weeks, how quickly the world can transform. Individually, we can transform. And as an organization, I can tell you, we moved seamlessly to digital, and it bodes well for a strong future, leveraging all of the technical opportunities that we have in front of us. So to the growth drivers. First of all, DUPIXENT, we set out our ambition to be greater than EUR 10 billion. We reminded everybody that our growth in vaccines will be high single-digit through the period to 2025. And we talked about prioritizing and accelerating our pipeline, of which there are some real hidden gems I'll share with you in a moment. DUPIXENT, more specifically, we're happy to compete and we're happy to win. But we're never happier than when helping educate and get access to medicines that will make somebody's life better on a daily basis. DUPIXENT is one of those medicines. Less than 2% or 3% of the patients across the world, across the indications that would truly benefit from this medicine have currently got access to this medicine. We will tirelessly campaign to make sure those whose lives can be changed can take advantage of this. And when we do, our EUR 10 billion plus aspiration will be easily achieved. And we'll be happy for that to be the case because we'll reinvest in more innovation because that is what our purpose is. Moving on to Vaccines -- sorry, moving on to some of the more detail around DUPIXENT. It's not just one medicine and one indication. There are 3, of course, indications alone in dermatology, prurigo nodularis, pemphigoid and, of course, chronic spontaneous urticaria, all where patients are really struggling, all where they will benefit from these upcoming launches. In respiratory, we moved ahead with nasal polyps. We're already in asthma, and we'll look ahead to COPD. There are no biologic medicines in COPD. We hope to be able to change the lives of countless people. And beyond those indications, we'll push on to eosinophilic esophagitis, and we'll keep trying to break new ground, bringing new scientific evidence for those that need it most. As for Vaccines, well, they've never been more talked about than they are right now across the world and in all the media and all the governments. We know the importance. We laid out in Capital Markets Day last December, that we expected to grow in PPH and boosters. We expected to continue to grow in influenza. And we would see the launch of our RSV vaccine for young preterm and full term infants towards 2023, 2024. Now the makeup of this will change slightly, our ambition will not. Our makeup means that we may have more opportunity with influenza and vaccines, and we're already seeing governments talking to us about how to protect the elderly and the vulnerable from influenza alone as we go into the fall. We will, of course, play our part in COVID-19. And we're the only company, I think, with 2 vaccines in play, more of that a little bit later. So COVID-19 may play a part in our growth over the next few years. Onwards to our pipeline. And one of the privileges of coming in with fresh eyes and taking a look at some of our exciting assets in the pipeline was to be a little bit dispassionate about them and to have these fresh eyes to look at the opportunity. We have some incredible signs, these hidden gems that I've referred to in the past. We will transform the practice of hemophilia. The current innovative medicines are simply not delivering on their promise. We hope to deliver on breast cancer and to get the final balance between tolerability and efficacy for those women that need it most. We think we can do incredible things there. For venglustat in rare diseases, we've a proud history in lysosomal storage disorders. Gaucher, Pompe, Fabry. We will bring venglustat forward to hopefully supplement or even replace to make sure that patients can live as normal a life as possible. And for nirsevimab, I talked about in respiratory syncytial virus in young children, infants. And the BTK, more of that in a moment, but we're proud of what we've done, and we'll continue to do in multiple sclerosis. So we came out of the meeting last December, and since then, we've been looking at the news flow around some very exciting opportunities in our pipeline. I'll start with the BTK. Normally, we present the evidence for our BTK or for any medicine at a national or international congress. There may be several hundred people or more in the audience to watch that. Pivoting like we have to a digital world that we now live in, we presented a scientific symposium last Thursday, live, online. And we had over 1,000 physicians from all across the world join to look at this new groundbreaking data. The summary, of course, this medicine may not just be best-in-class for multiple sclerosis patients, it may be best in disease. It may be the future and the greatest hope many of those patients will have ever had access to. DUPIXENT will push on to be used in younger children and young adults, 6 to 11 years of age. This is often when these diseases are setting in, of course, but it is also where the safety profile, which is best-in-class, will be incredibly important for these parents, these young children and the children themselves, to make sure they're safely treated, but also with great efficacy. And then for Sarclisa, we were approved in the U.S. just before we went into confinement. And of course, that slows us down a little bit but the early pickup in discussion from physicians is they love what we're trying to do with our science. They love what we'll do with multiple myeloma, and we're trying to break new ground. Before I continue, maybe just a few moments to reflect on some of the voices from our pipeline and some of the voices from our R&D effort, just to share with you some of the enthusiasm and purpose-driven nature of what our people do. [Presentation]

It's really a great pleasure to share that video. As I wandered around our labs, which I have across the world, I've met these people and many like them who are committed to trying to change the practice of medicine. You'd be amazed and indeed proud of the work they're doing on any given day. Of course, we need to make sure our business can deliver on that innovation promise and keep investing in our pipeline. So we balance that delicate act of driving a business to reinvest in science and innovation and change lives. We've set ourselves some goals coming out of Capital Markets Day. We said we wanted to get our BOI to above 30% by 2022 and above 32% of by 2025. We chose those rather than sales and expense lines because we wanted the opportunity to decide where to invest, where to pullback, how to move so that we could follow opportunity. Even by 2025, we will only be at the peer average. So we're not pushing ourselves beyond. What we're saying is, can we be more efficient? Can we be more effective? Can we be responsible? Can we create more moments of magic from our laboratories? That is what we're going to do. To get there, we need to be very good at resource allocation and prioritization. It started with a strategy. Once it was clear, it became obvious that we could pull back in some areas and go faster in other areas. That in itself allows us to make some savings and accelerate our performance. As recently as the beginning of this year, we pulled together our top suppliers that account for the majority of our major spending as a company, and we asked them to go on a journey with us, improve our productivity or lower our cost but be a partner because we would not just go on like we were going on. Every dollar, cent and euro had to work harder for us in our organization to deliver on our purpose. And of course, as we leverage tech and digital and data, we see opportunities for operational excellence every single day, not least, how we're coping by reducing travel to almost zero at this difficult period. Some of those behaviors will need to stay with us as we go further forward. We restructured to 4 BUs. On the right, Consumer Health. We wanted it to stand alone, so it could be more agile, unencumbered by a big pharma company, could move faster and compete in its own market. And we have aspirations that by the end of this year, it'll be back on to the market growth rate, if not beyond. We have made sure that we've resourced our Vaccines business to deliver on that high single-digit growth. Our General Medicines business, which is by far the biggest and is more mature than the rest, has a single-minded obsession. We're trying to make sure we leverage digital and data to do it more efficiently, while continuing to deliver on our promise to patients. And in Specialty, of course, many launches between autoimmunity and oncology. And we're ready to prepare for the BTK and for MS. It's exciting times, and I think our new structure and realigning to our priorities will make our opportunities even greater. So as I come a little bit closer to the end of my presentation, I wanted to touch on COVID-19. Like I said earlier, we have put everything we have and more to trying to do something about this. We have 2 vaccines in play. We have one, an experimental platform with mRNA in a collaboration with Translate Bio. And we have another, a recombinant baculovirus platform that has already proven with our Flublok medicine, and we'll push on building on our SARS experience to try and find a vaccine for COVID-19. We're the only company with two. We're pushing ahead very fast, and we hope to get data readout and be ready to launch immediately by the middle of next year or just beyond the half year. That is our bold ambition. We also have 2 medicines in our group that were really for other diseases, one for malaria and one for rheumatoid arthritis, where early physician experimentation in China and beyond had shown some effect in treating patients with severe or critical COVID-19. We have worked with the WHO and worked with our own studies and our partners to try and look more deeply to find out will they help these patients. We're just a few days or weeks away from being absolutely categoric about the effect that these medicines bring. And we've said in the public, we're making them available for those that need them. The last point there would be that we've also partnered with a diagnostics firm to make sure that we can do home testing for COVID-19. It is our ambition by the end of this year to allow patients using a smartphone and a disposable attachment to be able to test at home, so if they feel symptoms, if they're unsure or they're just simply anxious, they'll be able to know for certain whether they have COVID-19 or not. As we push on, we've done a huge amount of work, not least internally and externally with medicines, but we stepped back and said, how can we go even beyond what we're doing, which, I think, is class-leading. We've stepped forward. We announced over 100 million doses, as I touched on, of Plaquenil, to be made available free of charge, if the evidence proves to be conclusive that it has an effect in COVID-19. We're making a significant contribution to the hospital systems in Paris and beyond because they need more rest spaces. They need more opportunities to take a break from the frontline. And we want to step forward and just do some very simple things that we think will add value to those right at the leading edge. Likewise, in the elderly homes, the care of the elderly, where there's sort of unsung heroes fighting COVID-19. This is also places where we'll contribute a large amount of investment to try and make those areas better for those people that are doing, in turn, their very best. Lastly, we've done all of this whilst protecting the important safety considerations for the people in our company. We've had something like 20,000 people working every day at our industrial sites, socially distanced, temperature checked, making sure that we do everything possible to make sure that they are safe and can contribute to making essential medicines. We continue to have over 100% of our sites worldwide open and are operating close to 100% in terms of output. So as I draw to a conclusion, I just think it's worth sharing one more project, a project that we initiated a little while back which reflected on a situation Europe had found itself in, where it was running out of essential medicines, medicines whose prices had dropped quite low, that had gone to tender, and were being sourced very cheaply through their active ingredients from China, India and other places. Now that's okay. But as those supplies dried up, in this case, because of lockdowns, et cetera, from China and India, you started to understand what it was like when it became difficult to get these critical medicines. We have started a program to say we're going to IPO a part of our manufacturing organization that makes API, not just for us but for other companies. And we were going to give it an opportunity to be one of the most successful businesses for sure in the whole API worldwide landscape. But even more important than that, that it would mean that medicines that were essential and needed at low cost, high-quality but with guaranteed supply in Europe, would be available in Europe all the time. We're focused on making sure that we innovate, that we challenge ourselves not only at the far end of science and experimentation, but the practical everyday of what needs to be done. With that, I think I will hand over to Jean-Baptiste. Jean-Baptiste?

[Interpreted] Thank you, Paul. Ladies and gentlemen, I will now present the results for FY 2019 of your company in 2019 business. In 2019, business EPS grew by 6.8% at constant ForEx. That's a higher level than the roughly 5% announced during the publication of the results for Q2 2019, and of course, a much higher level than our initial forecast announced in February 2019, since we were then expecting growth ranging between 3% and 5% at constant ForEx for business EPS for the year. Revenues, meanwhile, grew by 2.8% at constant ForEx and to EUR 36.1 billion. Like-for-like, that is mostly adjusted for the disposal of the generics business in Europe at the end of the third quarter 2018. Revenues growth in 2019 was 3.6%. Apart from the business EPS goal, we also reached the various financial goals that we set ourselves for 2019. Our gross margin rate slightly improved and is now in line with our goal set at the beginning of the year. The 0.8% drop at constant ForEx for our operating expenses exceeding -- exceeded our initial goal, which was growth lower than 1% to reflect the success of our expenditures streamlining initiatives whilst investing into our growth drivers and our key R&D projects. Our tax rates remained in line with forecasts. Last but not least, once again this year, we are proposing to grow our dividend, as was just announced by our Chairman. Our business is split into 3 segments: Pharmaceuticals, Consumer Health Care, and vaccines. In Pharmaceuticals, business growth was 2.2% at constant ForEx and 3.3% like-for-like, mostly driven by Specialty Care, reflecting the strong performance of DUPIXENT. Declining business in General Medicines is mostly due to high price pressure in our diabetes franchise in the U.S. as well as prescription products established in Europe. China and emerging markets recorded growth of 6.4%. The 0.8% decline of our consumer health care business reflects the impact of the voluntary recall of Zantac, product suspensions related to changing regulatory requirements in Europe and the disposal of nonstrategic brands. Last but not least, vaccine performance remained strong with 9.3% growth, supported not only by the full year effect of the return to market of Pentaxim in China, but also by the strong momentum for all of our franchises. Moving on now to the P&L. Our net business income grew by 7% at constant ForEx, by more than our revenues, which grew by 2.8%. Our EBIT at plus 7.1% constant ForEx reflects our commercial expense and overhead streamlining initiatives as well as streamlining of R&D expenses, our tax rate was slightly higher in 2019 at 22%. Let's now move on to the IFRS net consolidated income. IFRS net consolidated income reached EUR 2.806 billion in 2019, down 34.8%. This decline is related to a write-off of intangible fixed assets for EUR 3,604 million, broken down mostly into a depreciation of EUR 2,803 million related to Eloctate because of estimates, revisions for future sales and a write-off of EUR 352 million related to the voluntary recall of Zantac. The bridge between net income from business in 2019 of EUR 7,489 million. Net IFRS consolidated income of EUR 2,806 million is mostly related to the depreciation of intangibles generated by past acquisitions, mainly Genzyme, Bioverativ, Consumer Healthcare from Boehringer Ingelheim and Aventis; the write-off of intangible fixed assets that I've just told you about; restructuring costs related to necessary adjustments in Europe, in Japan and the U.S.; and, of course, to the tax impact of all these items. Our balance sheet at 31 December, 2019, was very strong. We have equity worth EUR 59.1 billion, a slight increase. Our net financial debt at the end of 2019 reached EUR 15.1 billion, down EUR 2.5 billion. Our free cash flow follows a new definition. It's cash flow after WCR variations, acquisitions of tangible fixed assets and other acquisitions, net of capital gains from disposals, not excluding EUR 500 million, and payments related to restructurations and similar. This free cash flow reached EUR 6 billion in 2019, a growth of 48.6%. If you exclude the positive one-offs for roughly EUR 500 million, growth of that, free cash flow was sustained at roughly 34%, reflecting growth in our business, the success of our expense streamlining initiatives, whilst we were investing in growth drivers and key R&D projects. We are on the right track to reach our goal to increase by 50% our free cash flow in 2022. The right-hand side figure shows the change in net debt, which at the end of 2019, was down by EUR 2.5 billion, reaching EUR 15.1 billion, reflecting the acquisitions of Bioverativ and Ablynx in 2018 for a value close to $13 billion. In March, in order to refinance our debt, we successfully had a 2-tranche bond issue for a total amount of EUR 1.5 billion. The first tranche, EUR 750 million, was issued at a fixed rate of 1% with a 5-year maturity. The second tranche, also for EUR 750 million, was issued at a fixed rate of 1.5% for 10 years. In April, we had a matching issuance of EUR 250 million for each tranche. The success of these issuances shows how confident bond markets are in the robustness of Sanofi. We're also investing in our industrial footprint. Thus, in 2019, our investments reached EUR 1.4 billion, with a significant share devoted to strengthening our biological products production out capacity. We published our Q1 2020 results last Friday. Revenues were EUR 8,973 million, up 6.9% on a reported basis, and 6.6% at constant Forex. Growth was sustained by the strong performance of DUPIXENT. We also benefited from inventory building in distribution networks and with some patients because of the COVID-19 pandemic. We reckon that the COVID-19 effects accounts for roughly half of the growth of our sales for the quarter. Our cost reduction -- cost optimization initiatives, our efficiency initiatives, reflected into a 2.9% decline of operating expenses for the quarter. Business EPS for Q1 grew by 15.6%. We also reckoned that about half of this growth was due to the COVID-19 effect. We expect that favorable effect from the pandemic of COVID-19 on revenues and business EPS in the first quarter will be largely offset in the second quarter. Our free cash flow grew strongly in the first quarter by 90%, benefiting from roughly EUR 500 million in positive one-offs. Excluding these EUR 500 million, growth in free cash flow in Q1 was roughly 29%. As I was saying, regarding for the total of the previous year with this first quarter 2020, we're on the right track to reach our 2022 goal to improve our free cash flow by 50% compared to the year 2018. We've kept our business EPS growth goal of 5% at constant ForEx in 2020, given the recently unfavorable change in the price of certain currencies, especially those from emerging countries. We expect that the impacts of currency on a business EPS in 2020 will range between minus 1% and minus 2%. As you can see, we are confident in the quality of our results and of the outlook for our business in the context that it is disrupted by the COVID-19 pandemic. Ladies and gentlemen, thank you very much for your kind attention.

[Interpreted] Thank you, Jean-Baptiste. And I will now give the floor to the auditors who will give you a summary of their work on a video conference.

[Foreign Language]

[Interpreted] Mr. [ Ertrel ]. It is unfortunately not possible this year because of this health situation to have a debate for the shareholders. However, questions were raised ahead of this AGM. There was a dedicated e-mail address. We received as many as written questions and the answers were published on the website of the company. I will ask Philippe Peyre to introduce the resolutions as well as the results of the vote. We will not read out all 21 resolutions.

[Interpreted] As announced at the beginning of the year, the votes were already recorded prior to the AGM. So we will simply go through the results of the votes for each resolution. Resolution #1 was the approval of the individual company financial statements for the year ended December 31, 2019, and the resolution was approved. Resolution #2, was the approval of the consolidated financial statements for the year ended 31 December, 2019. Again, we had a approval on that resolution. Resolution #3 was on the appropriation of results for the year ended 31 December, 2019, and the setting of the dividend. And that resolution was accepted. Resolution #4 was on the approval of regulated party agreements and commitments falling within the scope of Article L. 225-38 and following of the French Commercial Code and that resolution was adopted. Resolution #1 (sic) [ #5 ] was on the ratification of the co-opting of Paul Hudson as a Director of the Board, and that was also adopted. Resolution #6 is to the reappointment of Laurent Attal as a member of the Board, and that resolution was adopted as well. Resolution #7 is on the reappointment of Carole Piwnica as a Director, and that resolution was adopted. Resolution #8 was to reappoint Diane Souza as a Director, and that was also adopted. Resolution #9 was to reappoint Thomas Südhof as a Director. This was also adopted. Resolution #10 was to reappoint Rachel Duan as a new Director, and that was carried as well. Resolution #11 was to appoint Lise Kingo as a Director, and that was carried as well. Resolution #12 was to determine the compensation amount for the Board of Directors, and that was also adopted. Number 13 was to approve the compensation policy for the Directors, and that was adopted as well. Resolution #14, to approve the compensation policy for the Chairman of the Board of Directors. It was adopted. Resolution 15 was to approve the compensation policy for the Chief Executive Officer, adopted. Resolution #16 was to approve the report on the compensation of corporate officers issued in accordance with Article L. 225-37-3 of the French Commercial Code, and this was adopted as well. Resolution #17 was to approve the various items in the compensation package paid or awarded in respect to the year ended 31 December, 2019, to Serge Weinberg, Chairman of the Board, and that was adopted. Resolution #18 was to endorse the items in the compensation package for the year ended 31 December, 2019, to Paul Hudson, Chief Executive Officer as of 31 -- as of September 1, 2019. That was adopted as well. Resolution 19 was on the adoption of the items in the compensation package for the year ended 31 December, 2019, to Olivier Brandicourt, CEO till 31 August, 2019. That was rejected.

[Interpreted] Philippe, if I may, at this point, if this resolution is rejected. This means that the Board of Directors, which will meet after this AGM, will draw the lessons of that negative vote, and the conclusions of the Board will be issued after the meeting. Thank you.

[Interpreted] Resolution #20 is to authorize the Board of Directors to carry out transactions in company's shares. That is adopted. And the final resolution, powers for formalities, and that, of course, is adopted as well.

[Interpreted] Right. Well, thank you, Philippe. Ladies and gentlemen, as all resolutions were voted and as the agenda is now exhausted, this brings this AGM to an end. And I certainly hope that next year, we will meet in the more congenial fashion. And so we look forward to seeing you on the 30th of April, 2021, for the next AGM, which, I hope will take place in its usual form. Thank you. [Portions of this transcript that are marked [Interpreted] were spoken by an interpreter present on the live call.]