“What it really all came down to, last quarter they reported disappointing guidance for their diabetes franchise, and probably even more importantly what affected the stock was that the CEO was fired due to conflicts with the board of directors of the company. So there was a big cloud of uncertainty over the company that’s a real short-term concern,” Quenneville said.
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Quenneville, however, believes that overall Sanofi is a company with a wide moat and very attractive business.
“It’s well diversified; it has a strong vaccine business and longer-term the diabetes franchise, which is the big driver for the company and does have challenges, is still an attractive place to be. So overall we think that given its valuation, which is quite cheap compared to most of its Big Pharma peers, this is a good opportunity to get into a wide moat company at a really attractive discount to its fair value,” Quenneville said.