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Beyond Green:
Operationalizing Sustainability in a
Changing Environment
Veronica Croucher
Director, Group Sustainability Projects
Peter Lalli
Senior Director, Business Planning and Sustainability
Sanofi-aventis
2008 sales: Euro 27,568 million
No. 4 Worldwide
No. 1 in Europe
Present in double-digit growth in emerging markets
Present in more than 100 countries
Almost 100,000 employees
2
Sanofi-aventis is transforming itself
The ambition of sanofi-aventis is to become a diversified
global leader in healthcare. The Group strategy is based on
three key themes to reach these objectives and deliver
sustainable growth
Increasing innovation in Research and Development
Adapting our structures to meet the challenges of the future
Exploring external growth opportunities
3
Sanofi-aventis in the U.S.
Pharma Ops Sales
Total - $17 Billion
(incl. Plavix/Avapro/Actonel)
Consolidated - $10.2 Billion
Pharma Ops Locations
Corporate Headquarters
5 Regional Hub Offices
4
Sanofi-aventis U.S. Industry Rank
5
Market Dynamics
Status / Dynamics
Passes the $300B mark (July 2008 MAT $303B)
Growth continues to decline
4.0%
4.0% 3.0%
2.7%
3.5%
2.5%
3.0%
2.3% 2.0%
2.5%
2.0%
2.0% 1.5%
1.2%
1.5%
1.0%
1.0%
0.5%
0.5% 0.1%
0.0% 0.0%
2007 2008 MAT Feb 2009 2007 2008 MAT Feb 2009*
Market Dollar Growth YTD Market RX Growth YTD
6
* Will be further impacted by IMS restatements
Generic Impact
Accounts for 65% of Total Rx Volume
% Total prescriptions dispensed
100% 6% 6% 7% 8% 8% 9% 10%
14% 14% 14%
90% 8% 9% 9% 9% 10% 10%
10%
80% 10% 11% 11% 38% 38% 40%
43% 46%
50% 54%
70% 60%
64% 65%
60% 11% 11%
11%
11%
50% 11%
10%
86% 85% 84% 83% 83% 9%
40% 81% 80%
76% 75% 74%
9%
9%
30% 9%
51% 51% 49%
46% 44%
20% 40% 37%
31%
27% 26%
10%
0%
00
01
02
03
04
05
06
07
08
00
01
02
03
04
05
06
07
08
9
9
00
00
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
2
2
b
b
Fe
Fe
T
T
A
A
M
M
Source: IMS NSP ending Feb 2009
Source: IMS NPA ending Feb 2009
Brands Branded generic s Unbranded generic s
7
The Environment…
A changing regulatory environment in the US
Patent laws are evolving while current patents are challenged
The current marketing approaches have reached saturation or
diminishing return points in many markets
Increasing emphasis on demonstrated health outcomes (Gov’t & Payors)
Emergence of the healthcare consumer which is far different than
the healthcare patient
The government now is the largest payor
for pharmaceuticals
8
Changing Roles in the Marketplace
Old Model
Employees
PCPs
Specialists Patients/
Consumers
Promo
Decision Makers Mix Influencers
Recommending parties
Public payors
(eg, Medicare, State)
Pharmacy/
Third-party payors Hospital specialty pharmacy
Patient advocacy
associations Professional physician
Wholesalers/ Assisted-living/ associations
Employers
distribution channels senior centers/LTC
KOLs Public health and policy
New Model
9
Our Stakeholders
Medically Rating Agencies
Investor Underserved
Groups Industry
Peers
Employees NGOs Government
Agencies
Patients/Caregivers Scientific
Community
Healthcare
Professionals Suppliers and
Contractors
Managed Care Communities
Organizations Media
Shareholders
10
Transforming to meet the challenge…
New Business Model requires a mindset shift on how we define our value
proposition and how we approach our business
Expanding the definition of value – from product to solution
Improving patient health outcomes
Patients, Physicians, Payors
Quality of interaction with customers
When and in format the customer wants
More evidence based
Resource deployment and structure
Simplify organizational structure by reducing layers and increasing spans of control
Flexible deployment of resources
Leverage full U.S. presence
Being the employer, neighbor and investment of choice
Development opportunities for tomorrow…while meeting the needs of today
Community activities and support in the areas where we operate
Growing through innovation…
11
Embracing sustainability practices used to be
Embracing sustainability practices is now
“the right thing to to do”
“the necessary thing do”
12
Sustainability at sanofi-aventis
What does it mean to us?
•Sanofi-aventis acts in an ethical and responsible manner to be a true healthcare partner,
today and tomorrow.
•Our approach places the patient at the center of our business conduct in conjunction
with our social and corporate responsibilities as well as our environmental commitment.
•This vision of sustainability is an integral part of our global strategy, designed to
respond to patients needs and expectations by ensuring a balance between access to
healthcare, innovation, respect for intellectual property rights and sustainability of
healthcare systems.
•It only makes sense when it is fully integrated in the Group’s strategy and culture, in the
prospect of the long-term performance improvement.
13
The sanofi-aventis pillars
Translating the triple bottom line…
Planet 21
Environment
Social Economic Ethics 21
Patient 21 People 21
14
Sustainability at sanofi-aventis
Focus
•Access to healthcare (access to medicines and vaccines)
•Innovation and respect for intellectual property rights
Patient 21 •Outreach and support for patients, patient advocacy groups and the general
public
•Future of healthcare systems
•Ensuring the quality of our products (counterfeit drugs, parallel trade, etc.)
•Social dialogue
•Promoting equal opportunity and preventing discrimination
•Commitment to health and safety
People 21 •Career management and skill development
•Social protection
•Balancing work and personal life
•Local presence and a commitment to local communities
•Humanitarian and solidarity programs
•Codes of conduct
•Corporate governance
•Ethics in R&D (clinical trials, use of laboratory animals, stem
cell research, etc.)
Ethics 21 •Fighting corruption
•Human rights •Managing natural resources
•Relationships with suppliers and contractors •Respecting biodiversity
Planet 21
•Responsible marketing •Climate change
•Risk management •Environmental health
15
Sustainability Hot Topics
Innovation
Climate Change
Corruption and Bribery
Bioethics
Drug Counterfeiting
Promotional Practices Animal Welfare
16
Rating Agencies & Indices
Pacific Sustainability Index
17
Other Partnerships
•Sanofi-aventis is also a member of a number of other organizations
promoting sustainability:
CSR Europe is the leading European business network for corporate social
responsibility with ~70 multinational corporations and 25 national partner
organizations as members.
Sanofi-aventis a founding member of the EDH initiative (Entreprises pour
les Droits de l’Homme). The “Businesses for Human Rights” initiative
EDH
comprises eight members, all French-speaking international groups, and
was created following exchange with organizations such as Business
Leaders Initiative on Human Rights (BLIHR) and the French section of
Amnesty
International.
Business for Social Responsibility works with its global network of more
than 250 member companies to develop sustainable business strategies and
solutions through consulting, research, and cross-sector collaboration.
18
U.S. Sustainability Efforts
U.S. Sustainability
•US Sustainability Core Council in place
•Sustainability strategy in development
•Strategy will enhance/formalize existing practices
• Sustainability is the way we do business – NOT a new program
• Existing initiatives with little or no support can be brought under the
sustainability umbrella
20
U.S. Sustainability Core Council
Overall Leads
Pete Lalli Veronica Croucher
Business Planning and Sustainability Group Sustainability
Executive Core Council
VP VP
Business Information and Support Oncology BU
VP VP
Stakeholders Office (R&D) Human Resources
VP VP
Market Access and Business Development Policy and Govt. Relations (sanofi pasteur)
VP VP
U.S. Corporate Affairs CFO
VP AVP
General Counsel Site Services (sanofi pasteur)
21
sanofi-aventis Sustainability
U.S. Organization Focus Areas
Health Promotion: Patient 21 Patient 21
Social Engagement
People 21
Health Safety Environment
Planet 21
Purchasing & Supply Chain
Conducting Business Ethically Ethics 21
22
Health Promotion: Patient 21
Sub-Team
Function Scope
Marketing and Sales Planning R&D
US PAPs US Pharm Ops
Supply Chain US Pharm Ops
Specialized Customer Capabilities US Pharm Ops
US Government Affairs US Pharm Ops
R&D Sanofi pasteur US
R&D (Toronto) Sanofi pasteur CA
23
Patient 21
24
Social Engagement
Sub-Team
Function Scope
Community Affairs US Pharm Ops
US Philanthropy US Pharm Ops
Human Resources US Pharm Ops
Communications Sanofi-aventis CA
Communications Sanofi pasteur US
Human Resources US R&D
Human Resources Sanofi pasteur US
25
Social Engagement
26
Business Ethics
Sub-Team
Function Scope
US Legal US Pharm Ops
Compliance US
Quality and Compliance US Pharm Ops
Quality and Compliance US R&D
Investor Relations US
Legal Sanofi-aventis CA
Legal Sanofi pasteur US
27
Conducting Business Ethically
28
Health Safety and Environment
Current Sub-Team
Function Scope
HSE US R&D
HSE US Pharm Ops
HSE Sanofi pasteur
HSE Sanofi-aventis CA
29
Health Safety Environment Performance
30
NA Purchasing & Supply Chain Council
Sub-Team
Function Scope
Purchasing US Pharm Ops
Distribution/ Supply Chain US Pharm Ops
Clinical Purchasing US R&D
Scientific Purchasing US R&D
Purchasing Sanofi pasteur US
Purchasing Sanofi-aventis CA
Industrial Affairs US Pharm Ops
31
North American Purchasing Council
32
2008 Corporate Sustainability Report
33
sanofi-aventis Internet website
http://sustainability.sanofi-aventis.com
34
U.S. Sustainability Efforts in Action…
Sustainability Awareness Program
U.S. Mailbox:
US.Sustainability@sanofi-aventis.com
35
Sustaining a Healthy Future…
36
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