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Sanofi Overcomes Diabetes Crunch, Surges After Boosting Forecast

  • Drugmaker to divest EU generics business within 12-24 months
  • Lantus successor won’t fully replace old best-seller’s sales

Sanofi raised its earnings forecast after soaring sales for flu vaccines and a multiple-sclerosis pill helped offset price pressures at the French drugmaker’s diabetes business in the U.S. The shares rose the most in more than seven years.

Earnings per share, excluding some items, will probably increase between 3 percent and 5 percent at constant exchange rates, the Paris-based company said in a statement on Friday. Sanofi had previously said earnings by that measure would be broadly stable. It’s starting a 3.5 billion-euro ($3.8 billion) share buyback program.

Sanofi is benefiting from a diverse portfolio compared with diabetes market competitor Novo Nordisk A/S, which slashed its forecast and saw its shares sink the most in more than 14 years. Chief Executive Officer Olivier Brandicourt is counting on new therapy areas to replace declining revenue from best-selling insulin Lantus, which lost patent protection last year. Sanofi on Friday confirmed a plan to divest its European generic-drug business, which garners about 800 million euros in annual sales...