Ladies and gentlemen, good afternoon. Welcome to the Sanofi Q2 2016 Results Conference Call and Live Webcast. I am Salina, the Chorus Call operator. The conference must not be recorded for publication or broadcast. I would now like to turn the call over to Mr. George Grofik, Vice President, Head of Investor Relations at Sanofi. Please go ahead, sir.

Good morning and good afternoon to everyone on the call. Thank you for joining us to review Sanofi's second quarter 2016 results. As usual, you can find the slides of the call on the Investors page of our website at sanofi.com. Moving to slide 2, I'd like to remind you that information presented in this call contains forward-looking statements that involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially. I refer you to our Form 20-F document on file with the SEC and also our document de référence for a description of these risk factors. With that, please advance to slide 3, and let me introduce our speakers on the call today. With me are Olivier Brandicourt, Chief Executive Officer; Jérôme Contamine, Executive Vice President and Chief Financial Officer; as well as Elias Zerhouni, President, Global R&D. Also joining us today for the Q&A session the heads of our five global business units: Olivier Charmeil, Executive Vice President, General Medicines and Emerging Markets; Peter Guenter, Executive Vice President, Diabetes & Cardiovascular; Carsten Hellmann, Executive Vice President, Merial; David Loew, Executive Vice President, Sanofi Pasteur; and David Meeker, Executive Vice President, Sanofi Genzyme. First, Olivier will discuss the key highlights of the second quarter of 2016, then Elias will provide a summary of the progress we have made in the R&D in the quarter. After that Jérôme will review Sanofi's financial results before we open the call to Q&A. Before we start, I'd like to remind you of some important accounting items that affect the second quarter. First, as a result of the announcement of exclusive negotiations with Boehringer Ingelheim on the potential asset swap, certain changes in the way we report and present our results are required. Under current IFRS accounting standards, we need to report Animal Health separately as a discontinued operation. However, to help with your year-over-year comparisons, we will use the term aggregate, which simply means that our Animal Health business is included in our financial result lines as before. Second, given there has been no indication of improvement in the economic situation in Venezuela, Sanofi decided earlier this year to change the FX rate used for the Venezuelan bolivar. Sanofi now uses the DICOM exchange rate, which was around VEF628 per US$1. This new exchange rate replaces the official CENCOEX rate of VEF6.3 per US$1, which was used in the second quarter of last year. With that, I'd like to turn the call over to Olivier.

Thank you, George. Good morning, good afternoon to everyone, and welcome to our second quarter 2016 earnings conference call. So, starting with slide number five, as we expected, this was a somewhat challenging quarter, which was marked by the headwinds from Venezuela and the Plavix loss of exclusivity in Japan. Company aggregate sales, which include Animal Health, were down slightly to €8.9 billion in the quarter. Currencies, mainly in emerging markets, had a negative impact of €382 million or roughly 4% of sales. However, excluding Venezuela, sales would have been up almost 2% at CER. Business EPS in the quarter declined by 2.1% at constant exchange rates to €1.31, which Jérôme will explain in more detail later. Importantly, however, this is also the last quarter we will be seeing the negative impact from the Venezuela currency situation, and the Plavix LOE impact will be diminished in the second half of this year. As we will explain in second slide, the gross margin evolved very nicely despite the negative headwind of average net prices for diabetes and the Plavix LOE in Japan. This is largely the results of our initial efforts to streamline our Industrial Affairs organization as well as to focus on higher margin products, which allowed us to invest in R&D and our new launches. Now, on slide six, looking at our sales performance in more detail, I'm pleased that the new organization of our five global business units is now fully in place and is starting to deliver on the targeted operational improvements. Couple of highlights in the quarter included the continued strong growth of Sanofi Genzyme, up 20%, and also Sanofi Pasteur up 6.3%, although this is a seasonally low quarter for sales for this GBU usually. I will comment on the performance of each of our…

Thank you, Olivier, and welcome to all of you on the call. I'd like to turn to slide 16 and really share with you probably one of the most significant Phase III results we've had this quarter. And that is the CHRONOS study, which is the 52-week data for dupilumab in moderate to severe atopic dermatitis. As you can see, the EASI-75 results are consistent at 16 weeks and maintain at 52 weeks on top of corticosteroid therapy with significant clearing or near clearing of skin lesions in about 35% to 40% of patients, as you can see. And this really gives us again comfort that the PH2 (17:32) mechanism that we have been really addressing with dupilumab is a powerful mechanism independent of steroid actions that we will see again hopefully in asthma. And as announced here, we are going to start the Phase III study in nasal polyposis in the first quarter of 2017 to expand the reach of dupilumab in different disease areas. Now turning to slide 17, I'd like to just give you a brief update on the news flow that you are going to experience over the next quarters. I think when you look over the next 12 months, it will be a pretty rich news flow. There will be additional regulatory approvals for Dengvaxia throughout the world. In diabetes, Adlyxin, as you heard, was approved in the U.S. this week; and in May, LixiLan also received a positive vote from the FDA Advisory Committee and would anticipate approval in late August. For sarilumab, the FDA accepted for review our BLA in rheumatoid arthritis and the PDUFA date is set for October 30 of this year. And in Europe, sarilumab was filed earlier this month. Lastly, I'd like to highlight again that we continue to…

Thank you, Jérôme. So to conclude, on slide 25, well, you can see that the financial results in the second quarter reflected the anticipated headwinds. The company continues to implement its 2020 strategic roadmap. We have continued to reshape our portfolio with the signing of the CHC asset swap agreement with Boehringer Ingelheim. And as I noted before, our performance with launches was a bit more mixed. Toujeo reached €141 million in sales in a competitive market and now captures about 6.1% of the basal insulin market in the U.S. On Praluent, the gradual uptake of the brand is underway globally and we have increased our U.S. market share. And on Dengvaxia, unfortunately the uptake has been impacted by a limited number of public immunization programs confirmed to date in endemic countries. Also we have advanced our innovative pipeline forward for future growth. So, overall, I am pleased with the operational performance in the second quarter and in particularly the benefits that we are beginning to see from our simplified and more efficient organization around the five global business units. So now, I'm happy to answer the question. We are happy to answer the questions that you may have.

We will now open to call to your questions. As a reminder, we would like to ask you to limit your questions to two each.

The first question is from Mr. Tim Race from Deutsche Bank. Please go ahead.

Thank you taking my questions. Yes, it's Tim Race here from Deutsche Bank. So my two questions are, first of all, if we start off on the Lantus, the diabetes franchise generally. I know you can't talk about the US, but could you talk about biosimilars in the rest of the world, particularly in Europe? What you're seeing so far in terms of the impact? I know that there has been very divergent performance what we have seen in Germany or Slovenia, et cetera and it would be interesting to know how you're coping with biosimilars, how they're taking share, where they're taking share and why they're taking share? And also, what the competitive dynamics you're seeing with Tresiba are in those markets as well as at the same time? And then the next question just on Dengvaxia. Could you confirm that you're not changing your peak guidance for Dengvaxia and your peak expectations and do you expect 2017 to be slower than perhaps people or consensus currently forecasts? Thank you.

Very good. Thank you very much, Tim. So, David is Europe, and the impact of the biosimilars, Peter.

Yes, so, thanks, Tim, for the questions. So as you have learned from the numbers actually, our European diabetes franchise is doing extremely well, despite launch of biosimilars, despite competition with Tresiba and also of course, some price decreases we had to accept on Lantus actually, we still have a value growth of 1.2%. And in volume growth our franchise of glargine is actually is growing by 9% for a basal market that is growing 6%. So to give you the big picture, it's actually a very decent performance, I would say, in Europe. Now, to answer precisely your question, if you look at the EU5, the impact of Basaglar is actually pretty limited. The share conglomerated for those five countries, EU5, is actually only 1.3%. There is a bit of an outlier, which is Italy. For the rest, those countries are actually pretty limited. It is true that some central and eastern European countries have reached higher shares. And Slovakia there is an outlier with 13.8% market share for Basaglar. To give you some of the numbers, you have – sorry 17% for Slovakia, Czech Republic 4.6%, Poland 5.4%. And actually the driver of that is primarily copay differences between Lantus and the biosimilar at the patient level. We have of course also taken in some cases the decision to revisit our pricing strategy to make sure that in terms of patient copay we are at level playing field. So all in all, we are of course monitoring this very closely, but I would say relatively little impact so far.

All right. Tim, on your second question, as you know, we do not give peak sales forecasts for individual drugs. And as you know, we have guided that the group of the six key new products could generate peak sales of €12 billion to €14 billion by 2025, and clearly Dengvaxia is among the six. Beyond that, we are not providing more details. Now, as I said on Dengvaxia, sales can fluctuate significantly depending – because we are depending on emerging countries' government orders. So it can fluctuate according to local political and economic situations, local budget restriction and of course that lead to a size of vaccination program which will be implemented across those countries. So, for 2016, as I said, we have only a limited number of public immunization. We started with the Philippines, as you remember, in Q1, and we had about €20 million orders there for campaign of vaccination of 1 million schoolchildren, which went very well. And we've got a second order for 500,000 people from Paraná State in Brazil. We hope to continue to get other states. As you know, you have larger states also in Brazil. But it's difficult to predict exactly how this will unfold during the rest of the year. So our position at this point, Dengvaxia is probably unlikely to meet Sanofi's or our prior sales expectation for 2016.

Operator, next question.

The next question is from Florent Cespedes from Société Générale. Please go ahead. Florent Cespedes - Société Générale SA (France): Good afternoon, gentlemen. Thank you very much for taking my questions. Two quick ones. First, on energy markets. Could you share with us where you still see challenges ahead and where you see some upside in the short term. And could you elaborate a bit on the situation in China, the performance in China, which seems to be a little weaker this quarter but is it due to some (32:32) in vaccines? And my second question is on consumer. What could re-energize this franchise because you flagged that Doliprane did better in France following a DTC campaign. So do we have to understand that you have to invest more or is just the recovery of the emerging markets that will help? Thank you.

Okay. Very good. So first question on upside in emerging market short-term that's for Olivier, Olivier?

Yeah. So thank you, Florent, for your question. So we have been performing very consistently in the last quarter in the emerging markets. We continue to show a steady growth. We have been growing 6.7% for the total quarter in the emerging markets. Our growth are in very steady across the geographies, growing in Latin America 5.7%, growing in Eurasia 4%, growing in Asia a little bit less. We continue to see significant momentum in China, where on the pharmaceutical side of our business, we grow 11.7% and we continue to outgrow the market and to outgrow our peer. Our portfolio, which is mainly as I think chronic disease well fit the need of China. We outgrow the market in the therapeutic categories where we are. And we bear the fruit of the investment that we have been doing in the last three or four years with our country market strategy. Overall now the performance in China was 2.6% for the quarter, but 11.7%, as I just mentioned, for the pharmaceutical market. We have been impacted on the vaccines side of the business and I will let David Loew comment a little bit further on the vaccines.

On vaccines and what happens there, David.

So in the emerging markets, overall, we have seen a strong performance growing 9.8%. This was driven mainly by the pediatric vaccine. However, as you have heard before from Olivier Brandicourt, Dengvaxia a little bit slower than what we have expected. In China, we had the Zhengdong case where there were illegal sales activity and break code chain. Therefore, the Chinese authorities have intervened and asked the manufacturers not to pass any more through different levels of distributors. There is now regulations that the manufacturers need to deliver directly to 2,200 points of central participant control in China. We're setting up this logistical chain and we anticipate that this unprecedented impact is going to last probably four to six months. After that, we see China coming back to normal again.

And on CHC, Florent, yes, we have mixed results and you've seen details here. On one hand here developed market, and we have mentioned Doliprane in France which responded well to DTC. So performance has been, you know, dragged down by what happened in emerging countries and more specifically in fact in Russia even more than Brazil. And of course, the big impact of Venezuela, which we shouldn't see much more during the second half of this year. But frankly, we are looking forward to put that BU together, so you're talking short-term. I would say, starting in 2017, assuming that we can close the deal by the end of this year. We are very excited by putting those two portfolios together and putting the two teams together. We are working on plans already and improving this overall performance. In term of margins, as you know, Sanofi margins are on our side around 30%, which is higher than what we think is on the other side. And we will bring all that together to the Sanofi standard. So we still very optimistic and enthusiastic about what this new BU will deliver over time. Florent Cespedes - Société Générale SA (France): Thank you very much.

Thank you, Florent.

The next question is from Mr. Tim Anderson from Bernstein. Please go ahead.

Hi. This is Wei Chan (37:37) in for Tim Anderson. We have two questions for you. The first one is on immuno-oncology. So Sanofi, very similar to other companies, is a bit of a latecomer in terms of IO. So the first question really is, does Sanofi intend to sort of build an IO portfolio internally or are you considering acquisitions as the best way to grow there? The second question is in regards to M&A. At the analysts' meeting in November, there was a suggestion that Sanofi could make acquisitions around $20 billion or north of $20 billion, something along the lines of the size of Genzyme. So question is, is that still the plan? And then a related question to that is, in regards to larger M&A, is Sanofi willing to rule out a mega-merger at this point? Thank you.

Okay. Thank you for your questions on immuno-oncology. Just a reference to what we did last year. You remember we expanded our collaboration, which was a very important move, with our partners at Regeneron. That was only one aspect, and I'm going to ask Elias to tell you also how much more than that we did in order to ramp up our position in immuno-oncology. So, Elias, can you?

So again, as I have said before to you and Tim, as you know, immuno-oncology results so far, you have a 15%, 20% response. It's clear that to get to more than that, you have to have combination therapy that address not only checkpoint inhibitors but also ways of activating the immune system. And so that's what we're pursuing. We believe that there is a huge space of possibilities for combinations, monoclonal combinations, bispecifics, even trispecifics, and we have significant plans both in terms of partnership with Regeneron to really launch as fast as we can the PD-1, for example, which is in pivotal trials, and other combinations. But remember also that we have internal assets because of our vaccine tradition and immunology where we have a BCG vaccine. We have also the TGF-beta program. We have other capabilities internally to accelerate the immune response, which will be complementary to that. And so when you ask the question, we have a three way strategy. One is partnering with Regeneron. The second is combining with our internal assets and Regeneron assets and then coming with a new generation, what I would call the third generation, that hopefully will put us not just as players in the field but hopefully as leaders between now and 2020. Jérôme Contamine - Sanofi: Thank you, Elias. Wei, on your question on M&A, just like the last question, large M&A today is not part of our agenda. And on mid-sized, our focus in fact since November or a little bit earlier has been to deliver on our 2020 roadmap and in delivering that we want to strengthen certain key therapeutic areas. You mentioned oncology is one of them. And we previously highlighted others. M&A is one tool we can use and we will use to strengthen those different GAs and we mentioned in the past, up to the size, mid-size up to the size of Genzyme at the time, which were around $20 billion. But it's bolt-on and/or up to mid-size. That's what I would answer.

All right. Thank you very much, Wei.

Next question, please.

The next question is from Jo Walton from Credit Suisse. Please go ahead. Johannah H. Walton - Credit Suisse Securities (Europe) Ltd.: Thank you. My two questions. Firstly on Praluent. Now that you have approval for Praluent in some markets outside of the U.S., I wonder if Peter could tell us a bit about how you look at the ramp rate for this drug ex-U.S.? Clearly, you don't always have the step edits and you have a completely different structure of financing ex-U.S. So I wonder if you could just tell us from your initial discussions with the authorities in the regions that you've now got Praluent approved. Secondly, could you also just give us a bit more of a flavor perhaps, Jérôme, of how you're faring in restructuring? That's something that Sanofi is somewhat belatedly coming to. I appreciate you'll presumably have another round of restructuring to do with the BI integration next year. But in the base business and what you're doing, perhaps you could give us some examples to help us understand exactly what this restructuring means in practice and what it might mean to your cost ratios? Many thanks.

Okay, Jo. Peter, are you ready for Praluent ex-U.S.?

Yeah, Sure. Hi, Jo. Thanks for the question. So actually if you look at the situation in Europe first, I would say we have quite some encouraging news flow in the last couple of weeks and months actually. If I take again the big five for Europe, UK, Praluent is now recommended by NICE and the final guidance was issued in June 2016. In Germany, as you know, IQWiG is always a difficult hurdle to get over to and just as Repatha, the IQWiG had actually a couple of months ago decided that the PCSK9 class in the absence of outcome data did not have any additional benefit. Yet the encouraging thing is that the GBA who ultimately decides on pricing and reimbursement in Germany is working on what they call a group of high-risk patients that could be treated in a so-called economic way with PCSK9. So we are waiting for more precisions from Germany and we expect in the coming weeks and months to get more precision on that. France, we have a negative opinion of the Commission de Transparence and so there we have to come back when we have the CVOT study. Spain, we had very good news. We are now in the national reimbursement list in Spain, but as you know, you then have to negotiate on the regional level. And finally, Italy we are looking forward to launching the product in the fourth quarter. I'm not going to bore you too much with smaller countries in Europe, but I can also tell you then and we will come confirm that to you in the next quarterly or next call that we have a steady flow of mid-sized countries in Europe where we crack the nut one after one in terms of reimbursement. Last but not least, we have the approval in Japan. We expect to have the Japan pricing in September. Again you know the dynamics in Japan, you have the two week prescription limit. So of course a gradual uptake has to be forecasted for Japan. But I would say, all in all a relatively good news flow.

Thank you, Peter. Jo, on what you call the restructuring or, and I guess you are referring to our €1.5 billion program cost saving which we mentioned in November. So on this one we are going to be on track. We are on track with the program. We don't provide of course a phasing. And we mentioned at the time, which is still the case, that we will be back-hand loaded with that. It still is the structure we have announced at the time, which is basically two-third of cost savings will come from simplification and what would be a more focused portfolio. And the one-third would also come from investment prioritization. And we mentioned during our remarks that our gross margin has already benefited from some of that restructuring. Now, specifically on the BI because it may be a good example I'm going to ask Jérôme to give you some insights. Jérôme Contamine - Sanofi: Thank you Olivier. So specifically on BI, as you may recall and you may know, what we are going to acquire from BI is assets, country by country, which means that we are putting a lot of effort as of today between the signing of the closing to prepare for a proper integration of these assets in each and every country and to right-size our organization, both at country and at global level. So in a way, there is a lot of offer we see being done beforehand. Part of the efforts to improve the margin will then take place as a result of revisiting our overall strategy, including our purchasing strategy vis-à-vis advertising and having the right marketing approach. And you may know and may recall that in the previous call related to the signing of this swap we said that we would like to bring the overall consumer health business of Sanofi plus BI to deliver where the Sanofi is today, which is above 30% EBIT margin. Is it going to take place in 2017, it will be progressive. I would say more 2018, 2019 to really get to this level. And clearly it will be an effort as compared to where Boehringer Ingelheim is today. When it comes to ratios, you remember that back in November we gave some guidance for 2018 and we said that on one hand we would benefit from this cost saving and refocus, as Olivier highlighted again. At the same time, we are reinvesting behind our launches, new products. And are we are also investing behind R&D and we gave the guidance that we will increase our global R&D spending progressively. And altogether in 2018 we said that at minimum our ratio should be similar to 2015, everything being equal, both in term of gross margin and OpEx. The good news is that, as we said, that already our gross margin is in the 70% area, so it shows that these efforts are paying off and we are continuing to do that.

Thank you, Jérôme. And just last, Jo, I wanted to add that we remain vigilant in identifying additional cost-cutting opportunities beyond the program we have announced in November. Okay, very good. Thank you. Next, please.

The next question is from Luisa Hector from Exane. Please go ahead.

Hello. If I could start with diabetes and probably more on the U.S. side, how much visibility do you have on your contracts for 2017? And how do you plan to position Adlyxin and LixiLan? And maybe you could also address some of the comments from the FDA Advisory Committee where the pen design and the color of LixiLan was discussed in great detail with some concern there, I think, from the panel.

Okay, thank you, Luisa. So you start and then the FDA penal with Elias.

Yes, all right. Luisa, on the contracting cycle for 2017, as you know, these contracts have not been finalized. Of course, we have responded to the bids and the contract documents are pending with quasi all major payers. As some more color of course as anticipated, and in line with our assumptions for our guidance, these discussions, we could describe them as relatively intense, but we should have more visibility by the third quarter earnings call. We anticipate of course a net price erosion, but this is baked into our 2015, 2018 guidance. I would also take the opportunity here to remind you that the guidance is a CAGR guidance, it's not a year-by-year guidance, so the minus 4% to minus 8% is not necessarily what you are going to see every year of that guidance. On Adlyxin, LixiLan, so, very happy with the registration of the license of Adlyxin. We are not going to go too much in detail for competitive reasons in terms of positioning of those respective products. But it's clear that lixisenatide is very synergistic with glargine, with Lantus, PPG effect and FPG effect. So we are looking forward to this launch and that both for in the first injectable space as in the intensification space, we have the pivotal trials: LixiLan-L next to LixiLan-O. And obviously we're looking forward to continue our discussion with the FDA on LixiLan and be able to launch the product in the next couple of weeks.

Thank you, Peter. Elias?

Yes. Thank you for the questions. So we are working actually with the agency to address the concerns that were expressed at the advisory committee, which related primarily to human factors. I think there are – we decided to have two pens because it does offer wider range and it serves more patients. It also allows us not to decrease the dose of insulin as much as what other products would offer. I think in terms of the color, I mean, we're hopeful and confident that this will not be an issue, as they've been tested in terms of human factor studies. And as I said, we'll see towards the end of August in terms of the PDUFA date what comes out. But we're working diligently. I can't comment on what the FDA will decide, but we're very hopeful in that regard.

Thank you, Elias. Next, please?

The next question is from Mr. Graham Parry from Merrill Lynch.

Okay. Thanks for taking my questions. So, firstly, on Praluent, could you give a bit more detail around the reduced step edits with U.S. payers that you referred to and the percentage of covered lives that that's affecting and, perhaps, what the average number of statins that patients now need to fail on those plans to get on therapy would be? And to what extent, OUTCOMES data at the year-end could help with contracting for 2017 or is that really going to be a bit too late and we'd have to wait for 2018? Secondly, on the basal insulin 2017 contract and follow-up from Luisa's question there, at what percentage or proportion of your commercial contracts that are already negotiated for next year or longer-term contracts from prior years versus the proportion that are up for grabs or for renegotiation this year? And then, thirdly, on Dengvaxia and just to go back to the question here on previous guidance – I know this predates you, Olivier, but Sanofi had previously said that this was a vaccine where they saw blockbuster status of over €1 billion in potential sales. I wonder to what extent do you still feel comfortable with that comment? And to what extent is the slowdown here a slowdown of ramp versus lower demand than originally anticipated? And I'll stop there. Thank you.

Thank you, Graham. All right. A word, Peter, on step edit.

Actually, I think, that was at least five questions in one. I'm not sure I captured everything, but I will try. So what we have seen in the second quarter is actually some further contracting with some very important Part D plans, so that is number one. And then more by the end of the quarter actually, we managed in two important Part D plans and one commercial plan to get rid of the Zetia step edit. Now this is an important point because, as you probably know, so if you look at the PCSK9 eligible population only very few patients today are treated with statins and Zetia. So actually the step edit on Zetia is severely hampering the population. To give you an idea, number of patients of the eligible population receiving today the endostatin and Zetia is only 4% to 5% of the population. And even in some step edits, you have to go to two statins and Zetia and that's only 1% of the population. So you can imagine that getting rid progressively of that Zetia step edit is an absolute key focus of our discussions. On CVOT outcomes, probably Elias can comment on the interim analysis. But in case that would be overwhelming positive and we would stop the study. I would imagine that in the commercial piece of course we would start to negotiate even if the official cycle is done. But I think that if there is a major medical news, we are totally capable and entitled to of course not wait for another 12 months until the patients get the benefit of such a major event. Then, commercial contracting for glargine in the U.S. actually, you know that some of those contracts are on a yearly basis, other contracts are on a multi-year basis. Even though to be totally transparent, even multi-year contracts are not written in stone, and we have seen situations whereby payers would come back to us in case of the new phenomena like, for example, launching of new product. So it goes either way and that's basically what I can say to that.

Thank you, Peter. Graham, on your Dengvaxia question. So again I won't give you a long-term guidance. What we have in the past 12 months mentioned for 2016 was a potential forecast or achievement or performance of 200 million. We think it's not going to be achieved in 2016 as I said earlier, because of what we qualify as a delay in getting this large immunization program in Latin America. So that's what I would say.

All right. Thank you very much. Next question, please?

The next question is from Mr. Philippe Lanone from Natixis. Please go ahead.

Good afternoon. Two quick question. First on the guidance, you had previously indicated that 2016 would be more of a back-end loaded year with first half more difficult and second half more favorable. You end up the first half was being up 1.5% in EPS, so mathematically it should be better than the guidance for the full year. So my question is whether you have some things that you see differently for the second half, maybe with the OTC being weaker or is there some other item that might change your views on the second half? And also in the mature products, some products are declining more rapidly, not only Plavix but also Avapro and Renagel. So could you update us on the general situation for these two products?

Sure. So I'll take the first one about the guidance. We have not changed our broadly stable business EPS guidance for the entire year. You are right, H1 first half EPS growth was up 1.5%. So what I can say is it's a good indication that financial performance we have achieved during the first half will give us confidence in our ability to deliver the overall guidance. However, more specifically to your question and why we're not changing. Praluent, again, has had a slower than expected launch, primarily due to significant U.S. payer restriction. We're not entirely sure whether or not that's going to improve significantly during the second half. We just talked about, right, the number we had mentioned for dengue, which I also mentioned that it would be difficult to achieve in term of number of public immunization programs. So that impacts the performance for 2016. So overall I can say that we prefer to adopt a conservative approach given this uncertainty around the launch and the trajectory of these two launches. So that – is there another question. And then of course a question on established products. Olivier, do you want to?

Thanks, Philippe. I take the answer to your two question. With regard to (1:00:28) Avapro, we had significant sales in Venezuela, so we are down 16% versus last year with Venezuela. If we exclude Venezuela, we are down only 1%. So there is no rupture here in terms of trend. With regard to Renagel, we are expecting a directive. You know that the FDA tends to issue new guidelines at the beginning of the year, which might delay the entry of generics. But we work under the assumption that they'll come in the first quarter. With regard to Europe, due to the generics being marketed in some countries, we are down 30% in Europe year-on-year on sevelamer.

Thank you very much.

Thank you. Thank you very much. Next, please?

The next question is from Peter Verdult from Citigroup. Please go ahead.

Good afternoon. Thanks. Peter Verdult here from Citi. Could we just go back to two topics – oncology and diabetes? Maybe, kicking off with you, Elias, could you just put a little more meat on the bones on the earlier comments regarding your organic efforts in oncology? I just want to know latest on the CD38 program and now that you've got a PD-1 in Phase II, just a sense of what the nearest combination IO assets are in the Sanofi pipe and what the relevant timelines are. And then, Peter, on diabetes, correct me if I'm wrong, but over the years exclusivity has never been a feature of the U.S. basal insulin market. Given the changing dynamics, do investors need to start thinking about incumbents potentially seeking exclusivity going forward? And then just as an add-on to the last question, it seems to me that LixiLan you've got an interesting commercial opportunity. But I just want to understand how the commercial performance of Lyxumia outside of the U.S., why are we different this time given the lack of CV benefit that you have versus your peers? I just want to understand whether you're going to be putting all your eggs behind the LixiLan product versus the monotherapy. Thanks.

Thank you, Peter. Do you want to answer?

Okay. I'll start on the, Peter, on the exclusivity question. So this is of course very difficult to predict. We cannot rule out that a few payers will seek exclusive access for 2017. And by the way, this phenomenon is also assumed in our growth guidance. But if you look at the overall patient pool that is on Lantus, that is doing well on Lantus, is so big that it's not, I would say, intuitive to imagine that there will be massive contracting for exclusivity. And therefore, in case we would not be the exclusive glargine, that there would be literally hundred thousands of patients to be switched. This is probably hard to imagine. The question on LixiLan Lyxumia, again for competitive reasons, I would not like to go very deep here. I remind you that when we launched Lyxumia in Europe, unfortunately we didn't get it through reimbursement for the classical reasons in Germany and France in the diabetes market. But in those markets that we launched it with reimbursement, actually we gained easily between 10% and 20% market share. And in most cases Lyxumia wasn't prescribed on top of Lantus, which was for us kind of a proof-of-concept that from a messaging standpoint and from a clinical practice standpoint, LixiLan is actually responding to an unmet medical need. And that's why also of course we had the positive vote at the FDA advisory committee. So as you rightfully mention, we are pretty excited on this opportunity and looking forward to the launch.

Thank you, Peter, Oncology?

Okay, Peter, thanks for the question. So let me be a little more detailed. Obviously as you know, our CD38 is going into pivotal trials in the fourth quarter. We're really looking at that as a major opportunity because not only is CD38 itself a active drug, but we also have good evidence that combinations will work extremely well, especially CD38 PD1, which we are working on. We also have antibody drug conjugate programs in Phase II that are giving promising results that we will report on at a later date and continue. In terms of organic growth between combinations, as I told you, we do have internally to Sanofi the only GM-CSF in the world that can be combined very effectively. We are not only doing this within our own collaboration with Regeneron but with other partners outside of Regeneron and Sanofi. Clearly when you look at inorganic enhancements to the immunology oncology strategy that we have, you should note that we've signed an agreement with BioNTech, a German company in the mRNA field, because we have some ideas about exactly how you could combine that approach to maximize the immuno-oncology. But I'd like to turn it over to David who really, because of his specialty care focus, can probably comment even more on the strategic approaches that we have both in immuno-oncology and non immuno-oncology inorganic growth as you know. David?

Yeah. Thanks, Elias. So I think the oncology strategy is one we're revisiting. This is an area that's of high importance for Sanofi as we go forward. Then the pillars are working with what we have, prostate of course, just to highlight Jevtana which is a drug which continues to grow and prostate cancer is up 8.8%. And so we have a strong interest in deepening our involvement there. Second is building out around a CD38. And as Elias said, this is a molecule which certainly has tremendous potential. We would be second in class there as we complete our development program. But the importance of that molecule to the treatment of multiple myeloma certainly seems to be growing in significance and so we expect to play there and potentially in other hematologic indications. So we'll see how that goes with that part of the development. Immuno-oncology, again I think Elias highlighted again our efforts there. But these are three clear areas where we'll look to build out a very targeted approach in oncology. We're not looking to do the biggest, but we're looking to play meaningfully.

Thank you Elias. Thank you, David. Next question, please.

The next question is from Mr. Vincent Meunier from Morgan Stanley. Please go ahead. Vincent Meunier - Morgan Stanley & Co. International Plc: Hello. Thank you for taking my questions and sorry in advance if some of them have already been addressed, because I've been disconnected. On consumer in the U.S. in the context of a challenging environment in some EM markets, would you consider the U.S. as a top priority? And would you update us on Cialis OTC? Second question is, on Praluent can you update us on the legal dispute against Amgen? And lastly, on the generics in Europe, what is bolt-on the level of margins for that business and will a divestment be dilutive and if yes, by how much? Thank you.

All right. So we're going to start with Praluent litigation with Karen. Karen do you want to start, then we go to Gx Europe with you Jérôme and I'll answer the consumer U.S.

Well on the Praluent litigation in the U.S., there's really not much to report there. As you know, we had the jury decision in March, and since that time we've been working on post-trial briefings. They were completed at the end of the May, and we are in a position of just waiting for the judge to rule on the post-trial briefings and that can come any day. But we think likely since May it would be a matter of two to three months from May, so something in the next quarter.

Thank you, Karen. Jérôme Contamine - Sanofi: Thank you, Vincent, for your question on generics Europe. So as you remember, I mean we said back in November that we would put our strategy in generics Europe under review and take a position within one year. So you can say by the end of this year. In terms of profitability, I mean as compared to the competition our generics business is pretty profitable and is really doing well. A lot of efforts in terms of streamlining the organization both from a sales and marketing standpoint but also more importantly from an industrial standpoint. So it's an interesting business. Now it's clear that it's a medium size business in Europe, so you can think how you balance that versus other alternatives. So I will not speculate on what we will decide and your question on dilution, I mean there is scuttlebutt if we were to decide to go further anyway, I mean this will take time because I mean carving out this business takes always time as we've seen from going, carving out the whole CHC business. So in all cases I don't think that's something which is for to know but the first thing is do decide upon having what we want to do subjectly and I just reconfirmed that so far this business is really among the best performer I believe for generics in Europe, with a margin in the 20%, 25% range.

All right. Thank you, Jérôme. So consumer U.S. important, yes, of course tremendously important for our CHC business. We've done traditionally and through Chattem, our unit in the U.S., we've done very well. We grew on average above market from many quarters as you probably know. This quarter was slightly different because the allergy season was weak in the U.S. so we didn't achieve the same type of performance. But overall again, very important, doing well and planning to continue to do well there. When it comes to Cialis OTC switch, we are working to – to be honest, we are working with regulator to fine-tune the pathway. We continue to be optimistic about that switch and I would say more to come.

Thank you. Operator, take our last question.

Your last question comes from Seamus Fernandez from Leerink. Please go ahead.

Thanks very much for the questions. Just, on Praluent, is my first question. You know, most doctors we speak to think that a minimum benefit of 20% is necessary for the PCSK9s to really see a meaningful inflection in use. That's also consistent with your interim look and the timing of the interim look. Is there any reason why that 20% threshold might not be achieved at the interim but perhaps could be achieved at the final analysis? That's my first question. The second question really is related to the question of your willingness to go up in price in competitive acquisitions or potential acquisitions and how you assess value versus strategic acquisitions. I am just wondering in the context of some of the current dynamics and how some of the companies are trading within the oncology space, are you seeing opportunities for other potential acquisitions should value no longer be realized in the Medivation process? Thanks.

Okay. Praluent, Elias, the 20%.

Right. So your question relates to what's the likelihood of achieving that 0.8 hazard ratio, the 20%, that's what it means. And obviously, as you know, there is a relationship between having a 75% interim analysis with the number of events we have and the hazard ratio that you would like to – that is currently in the population. If the hazard ratio is greater than 20%, the likelihood of the interim analysis being positive is much higher, obviously. But we don't know that. The only indication we have is the long-term safety study with a hazard ratio of 0.5, gives us confidence that, in fact, there is an effect. On the other hand, you have to realize that the studies are event-driven and it would be hard to speculate, but there is no question that I think a 20% hazard ratio over the interim analysis gives us a higher likelihood of having an interim that's positive. But that is not going to be determined by me. It's going to be determined by the independent board and we would like to see the outcome measured on every single component of (1:15:08), and not just on any one component. So that we can be very, very sure that if we have overwhelming efficacy in the interim it will be very, very determinant efficacy for the medical field to truly make PCSK9 a major alternative for patients who cannot respond to maximally tolerated statins.

Okay. Thank you, Elias. And, Seamus, on your last question, then we have KPIs like every other company when it comes to M&A, so we are looking for return over the cost of capital over a period of 3 years or 4 years. Of course, the strategic value plays a role, no doubt, because that's a little bit included into your question. And as in the case, we are looking at currently where we want to rebuild oncology of course that has an important value. But as you know, historically, our company has been very, very disciplined financially when it comes to M&A and that will continue. So, that's what I would say. All right. With that, thank you very much, everyone, and do you want to conclude anything, George.

Thank you, everyone, for joining our second quarter call. We will conclude the call right now.

Okay, perfect. Thank you.

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