Sandoz Earnings: Biosimilar Momentum Ends the Year on Strong Footing and Should Fuel 2025 Growth

No-moat Sandoz reported solid fourth-quarter earnings that came in largely in line with our expectations. Total sales of $2.7 billion were up 6.7%, or 9% in constant currency, year over year thanks to strong performance across North America (up 13%) and Europe (up 7%). In the US, the continued uptake of Hyrimoz (adalimumab) led the way for biosimilar growth, and Europe benefited from the recent launch of Tyruko (natalizumab) and Pyzchiva (ustekinumab). Volume contributed 10 percentage points for growth and price resulted in a 1 percentage point headwind as the industry begins to see price erosion returning to low- to mid-single-digit levels. Generics and biosimilars were up 4% and 25%, respectively, in constant currency. After updating our model and inching up our near-term assumptions, we raise our fair value estimate to CHF 41 per share from CHF 39.