Welcome to the Sanofi 2012 Second Quarter Results Conference Call. I now hand over to Mr. Sébastien Martel and to Mr. Christoph Viehbacher. Sir, please go ahead. Sébastien Martel: Thank you. Hi, everyone, and welcome to our second quarter conference call. As always I must advise you that the information presented today in the call contains forward-looking statements that involve known and unknown risks and uncertainties that may cause actual results to differ materially. So I'd like to please ask you to refer to our Form 20-F on file with the SEC and also our Document de Référence for a description of these risk factors. So with me today on the call are Chris Viehbacher, our CEO; Hanspeter Spek, our President of Global Operations; Olivier Charmeil, Senior VP for Vaccines; and Jerome Contamine, our CFO. Without any further ado, let me turn the call over to Chris.

Well, good afternoon, good morning, everybody. This is a milestone quarter for Sanofi, not so much because of the results but clearly, on the 17th of May, the world's largest product, Plavix, lost its exclusivity in the marketplace, and that's clearly our biggest product. Of course, it's no surprise. It's something that we have been planning for, for well over 3 years. But in some ways and even though Eloxatin is going to lose exclusivity in a few weeks' time, this really, for us, starts a post-patent cliff period. So up to now, we've been preparing for the cliff, and now, we're coming through the cliff. So if you look at the numbers on Page 5, you can see that sales were EUR 8.8 million, which on a constant exchange rate basis were up 0.4%, so essentially flat with the quarter last year. If I could just make 2 remarks. First is I personally believe that the best way to look at the underlying performance of a business is at a constant exchange rate. So I normally don't make any comments on exchange rate movements, but I will say we've clearly seen a very significant movement in this quarter as Jerome will show you a little later on, and only time will tell as to whether or not this is the normal volatility of exchange rates or whether we're seeing a structural and more long-term change in the value of the euro versus the dollar. But it certainly had a bigger than normal impact between our reported earnings and the constant exchange rates. That having been said, we obviously are going to continue to discuss everything at constant exchange rates. Sales were flat, but in actual fact, of course, we had divested the Dermik dermatology business, and we gave back…

Yes. Thank you, Chris. Good morning. Good afternoon. Chris has said that we had a solid quarter. And if you look to my first chart, which is Page 13, you see confirmation. We have achieved approximately EUR 1.9 billion sales. This compares with EUR 8.5 billion for the first quarter 2012. Perhaps more importantly, what Chris mentioned, that this quarter really has become a kind of turning point for the whole company. And our portfolio trends you see when you compare the growth platforms, with losses due to generification and due to the departure of Copaxone and Dermik, you see then that for the first time, the growth platforms more than equalize the losses of genericized products and transfers. We have achieved EUR 386 million in this quarter coming from growth platforms, whilst in the last quarter, first quarter 2012, they have achieved exactly EUR 100 million less, EUR 287 million. And yes, finally, they also have been helped by the ForEx impact. This has been quite significant, with nearly EUR 0.5 billion this quarter compared to EUR 187 million for the last. So overall, a 6.2% growth including all of those effects. Turning the page to look to the Emerging Markets. Yes, we had, again, record sales in this quarter with EUR 2.8 billion, equalizing across of nearly 10%, record sales in the sense that this was, again, EUR 200 million more of sales than in the first quarter. Consequently, the share of Emerging Markets in our total sales has risen to 31.8%. And to give you a reference, this is approximately 5 points more than for the second and third best positioned companies in those markets which, to my knowledge, are Roche and GSK. On the other side, our exposure to the difficult market of Europe has been…

Thank you, Hanspeter. Hi, everyone. Good morning. Good afternoon. So as Chris just mentioned, our Vaccine business benefited during Q2 from the seasonal flu campaign in the Emerging Market. Our Q2 sales now reach EUR 783 million, up 3%. Our growth has been very much driven by our strong performance in the Emerging Market as well as mixed performance in mature market. Getting back to Emerging Markets, we saw a very strong of 22.9% at constant exchange rates. This is very much driven by another record flu season, and we achieved more than 54 million doses during H1 in the Southern Hemisphere after a very strong year last year. While we are on flu and we are getting ready for the flu season in the U.S., we are the first to get the licensure. We had the first treatment 10 days ago. And we have solid -- we observed solid pre-booking, especially for our differentiated forms, both flu high dose -- Fluzone high dose and Fluzone intradermal. Getting back to H1, mixed performance in the mature markets to date, very strong Adacel sales showing a growth of more than 30%. And we are very happy about our performance of Menactra. We have defined the competition. We continue to maintain a high market share. We, today, own more than 80% of the market. As Chris mentioned, we face, and you're aware, a temporary order limitation for Pentacel in the U.S. We think the beginning of the year, we are facing some manufacturing delays. We will get back to full supply, meaning that today I am continuing to ship, but we will get back to full supply during Q1 2013. In the upcoming months, we will face some shortfall on Pentacel, but that will be partially offset by the fact that we will ship more and more single entities. Looking ahead, nice opportunities are taking shape with the IPV. That will be added to the Japan immunization schedule on September 1. It's a significant opportunity for us in Japan. Another opportunity is also taking shape. It's the Hexaxim launch. We got the positive opinion of EMEA during the month of June, and it will open the opportunity of Hexaxim, so our [indiscernible] combination for the international market. Before handing over to Jerome and to the financials, on the profitability side, a nice growth of 19.6% of our business operating income on a reported basis. We also had very encouraging results on dengue, which were announced yesterday. Jerome, I hand over to you now.

Okay. Thank you, Olivier. So I'm now turning to the P&L. So to start with the P&L, I mean, the -- of course, the Q2 P&L reflects the impact of the loss of exclusivity of Plavix and Avapro, which we see are visible on 2 lines, which are the other revenues, the royalties, declining from EUR 422 million to EUR 247 million. And also, on the share of profit coming from associates, which is the other line, which is hit by the Plavix loss of exclusivity, going down from EUR 278 million to EUR 222 million. But at the same time, we have also had to taken -- to take an increase of the reserve under the litigation in connection with ramipril in Canada, which in fact is a judgment which has been taken by the court, and the amount will go to the generic producers coming back to the fore. We have appealed for this judgment, but we have however taken the reserves, which explains the variation on the other operating income. But there are also a lot of positive elements in this P&L, as I will discuss later on, both in terms of growth of sales, in terms of evolution of R&D, declining by 1.2% on a constant exchange rate basis and even more on SG&A, which have declined by 4.3% on a constant exchange rate basis between Q2 2011 and Q2 2012. You'll see as well that including all this effect and including this reserve [indiscernible], we have BOI, business operating margin, 31.3%, which is very much in line with what we gave as a guidance of the overall 2012 BOI. Chris mentioned already the positive impact or the favorable impact of exchange rates, but you could argue that this is something which is always volatile. But…

[Operator Instructions] The first question is from Mr. Richard Vosser from JPMorgan. Richard Vosser - JP Morgan Chase & Co, Research Division: It's Richard Vosser from JPMorgan. The question is around the progression of margin through 2012 and '13, 2 elements into that. Just wondering what the effect of incremental investments are in terms of building the multiple sclerosis franchise. Clearly, you've mentioned that September, you could have Aubagio on the market in the U.S. and Lemtrada maybe on the market by the end of the year. Two, so just wondering about the effect of the incremental investment on the 2012 and '13 margin. And also, could you update us on the plans for the restructuring that you've outlined, the EUR 2 billion savings, where we are with those and how that might affect the progression of the margin as well?

Well, on your first question on the effect on the investments, in particular behind our MS franchise, but I think you could add as well what we'll have to -- will invest behind Lyxumia. It's a bit risky, but we are going to invest more. We are rolling out our plans. I mean, I think it's a bit early to say what will be the exact net impact, because on the other hand, we are continuing to cut down here and there on our more mature areas. So it will be a balance which we have to be -- taken into account. So I just, first, confirm that the margin for 2012 will be between 31% and 32%. I can confirm as well that medium term, we will increase this margin. But then, as you said, I mean the timing of this improvement will somewhat depend upon the investments we'll do, and exactly the scope of this improvement will depend somewhat upon the investments we do quarter-by-quarter on these new franchises. So I mean that's where we'll -- I mean we'll go more into detail when we get into the 2013 guidance. On the restructuring, I mentioned already that the share which was supposed to come from the Genzyme integration is really on its way. The reference base was 2010 base cost. We aim to save $700 million. I must say that as early as beginning of 2013, we'll have achieved 100% of these savings. For the rest of the EUR 2 billion, well, I think that we should be, by the end of the year, around 1/3 of the total. So all in all, we'll have achieved, beginning of 2013, the full synergies on Genzyme. And on top of that, we'll have achieved around 1/3 of our overall EUR 2 billion cost saving plan.

The next question is from Mr. Michael Leuchten from Barclays.

It's another one for Jerome along the same line. At the strategic update day, Jerome, you did offer a quite detailed guidance on line items in the P&L, and I think your aim was to really address the potential impact from Plavix and Avapro. Now looking more how the year has shaped up so far, I'm not quite sure those line item guidances still hold. Could you address that please? And then also, structurally, you're keeping your 31% to 32% guidance for the margin even though you seem to get a bit more benefit from the other lines. So how does that tie in with the guidance as well, please?

Well, I think I tried to address -- remember which guidance I gave, and I think that, a, we said that the -- once again, the operating -- the net operating margin should increase from the 31% to 32% level onwards, and I think I can confirm that, as I said, answering to the previous question and what really still remains to be adjusting the pace of that depending upon the launch of new products and the investments behind these new products. The second thing, which probably you've noticed if you just cumulate the figures I gave you is that clearly, we are -- we'll be able to achieve, at least in 2012, around 40% of the overall EUR 2 billion platform. In other term, it will be much more than the average 25% of the 4-year plan. So we are clearly front-loading these -- the savings -- I mean, the Q2 results after the Q1 results confirmed our ability to reduce cost. Third, I think that I said as well that we should be able, when the gross margin will decline around 70% as a result of those change of mix but also the loss of other revenues coming from, in particular, Plavix, which will be somewhat of a floor. So the 70%, I think we should maintain and then increase. So the growth margin will be increased, keeping in mind that, of course, the Plavix impact will be still visible in the first quarter and beginning of second quarter of 2013 on a like-for-like basis. So we need all of us to be aware that we are just starting for 4 quarters, and we have just had 6 weeks, so there remain 46 weeks to get through before we don't see -- we don't speak anymore about the…

The next question is from Mr. Tim Anderson from Sanford Bernstein. Tim Anderson - Sanford C. Bernstein & Co., LLC., Research Division: A couple of questions. Lantus has been doing very well recently. It obviously faces new competition at some point from Novo. I'm hoping you might be able to -- might be willing to take a best guess at what the recent delay was, what that could be related to. I know you've disputed some of their data in their claims in the past, and I'm wondering if you think SPA may share some of those same concerns. Second question, on the FDA warning letters related to your 2 vaccine plants, can you frame out what the impact would be from a worst-case scenario, whereby let's say you have to shut down the plants? So I'm wondering how much product is theoretically at risk. And sometimes, once the FDA has a company on its radar, then it starts to find more problems. Can you say whether FDA has been through your other vaccine plants recently and signed off on them?

Hanspeter, I'll take the...

First, I'll take the Lantus question. I think that the evidence -- and the evidence is so nice that I cannot avoid to talk about it. I think it's evidence that there is a delay. It's evidence that this will help Lantus, and I think it's evidence that the fact that there is now a public hearing will make everything public which is supposed to be public. So evidently, we are -- yes, we are content with this situation in each and every respect. The Lantus evidence is all I could speculate about. And if you go back to our previous conferences, we have managed -- we have, at various times, said that we believe that parts of the results are flawed. We have stressed that we believe that parts of the results are clinically not very evident, and I evidently don't know why the SPA is setting up such a hearing on it. In fact, we have referred to -- there is the open label study design. There is a question of when Lantus has been dosed and is -- we consider as not being legalities. There is some question on the confidence and the robustness of the hypo reporting. We have raised question marks on the clinical relevance of the improvement of hypos overall, and finally, we have raised question marks on the importance of the titration of the dose. So all of this may lead to more complicated labeling discussions, but once again, all of this is speculation. The good thing is that everything will be public in relatively short time, and then we will see and we will take note of it.

Olivier, you want to take the warning letter question?

Yes. So 1 or 2 elements of the FDA warning letter we received addressed some aspects of our quality system, management aspect, to be a little bit more precise, the control of the environment and documentation procedure as well as recall management procedure. The 2 -- the warning letter that raised the issue of Toronto and of Marcy [ph] are totally unrelated. These were routine inspection that -- in the Vaccines as well in Biologics, a routine inspection come almost every 2 years. So the 2 inspections that took place were routine inspections, and we will continue that inspection in the next of couple of months. And we are waiting in the next couple of weeks an inspection of Swistora [ph], which is a routine inspection. With regard to impact of supply, the notification we received from FDA is going to be -- to have an impact on one of our product, which is the BCG [indiscernible]. We have decided, voluntarily and proactively before we got the warning letter, to discontinue the production, because we thought that it was the best way in order to be back on the market as soon as possible, which means that we will have a [indiscernible] situation for 12 -- a little bit more than 12 months. We will get back to full to supplier at the end of 2013, the impact in terms of sales, and the sales of [indiscernible] BCG were in 2011 in the range of EUR 40 million.

And I'll just maybe add. Last year, we had something like 150 external regulatory inspections of our plants worldwide. So there's somebody inspecting a plant of Sanofi on any particular given day, including about 1 to 2 FDA inspections per month. We've clearly taken it, like the warning letter, seriously. But at the same time, I think it is also true that we have seen increased vigilance in biological manufacturing, and that's just something that everybody has to keep up. We had a -- the only previous warning letter we had was -- in recent times, was in Frankfurt, and we see that being successfully resolved. So we will commit to, obviously, making sure that this doesn't develop into anything more. But I think the -- I think there's a trend if you look at the number of warning letters that the FDA has issued over the last few years. The FDA has doubled the number of inspectors, and this is a policy of really becoming tough on quality, and we actually agree with that. It's extremely important that, that cog be at the top. But again, if you look at the number of plants, the number of inspections, I think Sanofi has a very strong reputation in quality, and we intend to address this warning letter with all due process and speed.

The next question is from Mr. Philippe Lanone from Natixis.

Two questions, if I may, one on emerging markets. Very strong this quarter, plus 10%, but with Vaccine up a lot and Pharma up 8%. So I wondered whether your comments on double digit over the year can be applied to Pharma, excluding Vaccine. And if so, going forward, we can also bet on double digit keeping in mind that some of the competitors have given up on that target, whether we can apply that on Sanofi. And also, on Merial, very strong performance in the quarter, plus 9%, well above what we had in mind when you bought the company of something like 3% to 4% per year. So I wonder whether there was an impact from new products, in France especially. And [indiscernible] business, what kind of sustainable growth rate we can factor in for this business?

I'll start with Merial. There is an insignificant impact of new product. There's a little of an impact. You may remember we had an acquisition in the U.S., in Wisconsin during the second quarter. And so sales have been consolidated for the first time, but once again, it is insignificant. It is much more seasonal what we see in the second quarter. You should not expect that the business, overall, will end up as 7% or even 8% for the total year. I think if you estimate a close of 4% to 5%, and you are probably closer to reality, and you are definitely close to what we expect in terms of patch in France. This year I believe that midterm, Merial has better growth perspective, because it's grown very actively on new compounds, new products, also combination products, also oral product to replace Frontline, and not only to replace it but to really settle on top of it incremental sales. And those products will become available as of the end of 2013 and '14, and then you should see an accelerated growth into magnitude of let's say 7% or 8% without any further external growth coming from acquisition. Now on the Emerging Market front, the Pharma piece, I don't want to put the bar too high for Olivier, who will answer for you for Vaccines. But no, honestly, I think I cannot commit that internally, we will grow with 2 digits, because evidently, the base is permanently growing. And we should start then to look, in 2013, more to absolute growth than to relative growth, because if you go back to last 3 or 4 years, we have expanded base by billions of sales. And evidently, for just mathematical reasons, we cannot maintain a 10% growth for the years to come. And on Vaccines, Olivier?

So we always say that we have an accelerating growth in the next couple of years and with a slower growth at the first -- in the first phase of the period and the second phase of the period. So growth will be accelerating due first after the full impact of the launch of Hexaxim in the international market. That was a significant portion of our growth. Due also to the impact of our flu differentiation strategy. We are starting with our flu differentiation strategy, and this was evident in the U.S., a significant portion of our gross. And the last element and towards the end of the period will be the impact of dengue, and that will be evident in the Emerging Market, a significant portion of our growth.

I think the issue you're raising is one that you've analyzed, line of business in Emerging Markets, and I think you have to get away from a Western Europe, American view of the marketplace. Emerging Markets are not segmented like they are in U.S. The consumer business, the branded generic business, the branded business, Vaccines are all -- for instance, if you take Asia, all under single management. And quite honestly, if you look at channels of distribution, the way the products are sold, I don't think you can kind of start saying, "Well, what about your Pharma business? What about your consumer business." If we look at it as a marketplace, you got to look at a China, you look at an India, you don't look at Pharma within it, because it's an artificial thing to look at Pharma versus any other segment. The other thing is, of course, on a quarterly basis, you got different countries. You're going to have a Turkey in here somewhere, and you may have a higher percentage of Pharma in one market than you do in another. We have indicated through to 2015 that we expect to see double-digit growth of Emerging Markets, but that isn't necessarily Pharma. That's across the whole piece. So we don't really see any change to that. We grew 10% in 2011. We grew over 10% in 2012. We've got a broad mix of business. Remember, nobody's really got the extensive local manufacturing. Nobody's gone up really the same without this product portfolio. I mean, the biggest selling product in Brazil is Dorflex. We don't sell Dorflex anywhere else, but it sells great in Brazil. And that's why we are in consumer and branded generics and all of the other businesses. When you're in Brazil, for example, we…

The next question is from Mr. Graham Parry from Bank of America Merrill Lynch.

First was on the lack of guidance upgrade following a 5% beat versus consensus in the second quarter and 10% in first quarter, of course tracking below consensus expectations. And that was only offset this quarter by a one-off in the other expenses line, which turns into a gain in Q3. So I was just wondering what is it that's holding back the company from increasing guidance. What is it that you think that we're being too optimistic of having in the second half of the year? And second question is just on pricing in Europe. Could you give the explicit impact for your business in the Pharma business, the pricing in Europe into the second quarter? And then thirdly, on Aubagio, you've disclosed the PDUFA date for the 12th of August now, which I think means the FDA would have had to have notified you of a panel by now if there is going to be one. So could you confirm whether there is a panel coming and if there isn't, how we should read that?

All right. You're a little hard to understand there, Graham, but I think we got it. [Indiscernible] first question is on guidance. Look, the business is performing well, and we're very happy with the way the business is performing. Equally, we're in a very challenging macroeconomic environment. Most experts will tell you that big chunks of the world are going to be in recession by October. So our view is it's no time to be raising guidance until you see what the -- we don't live on an island here. We all live in a big macroeconomic environment. Even though the pharmaceutical industry is largely sheltered from that, I think we want to see how that develops. We also have Eloxatin coming through in August, and I think it makes sense to see how that plays out. But in general, we're very happy with the performance of the growth platforms and where the business is going. You see we've got clearly control of our costs and making good progress on the pipeline. On Aubagio, I'll take that, and then let you go on the European one. We've had an extension on the review of the FDA. That's why we've got a new PDUFA date of September 12. So that's pretty much in line with the expectation that we've given all along, which was Q3. There is, at this point in time, no confirmation of an advisory committee. I don't think I would interpret one way or another whether there is going to be one or not. I'm not sure that -- the FDA is not required to have one, but it's not exceptional that there be one if they decide to have one. So everything we've seen is that Aubagio is doing pretty well. On European prices, Hanspeter?

Well, on European prices, what we are aware of is that the Italian government is preparing interventions which most likely, definitely, probably, they'll hit into the second half of 2012. It's a little bit early to assess the magnitude, but it will be something on an annual basis, which may touch us between EUR 50 million and EUR 100 million of sales. Our sales in Italy were well above EUR 1 billion, so it is significant for Italy. For the overall European business, it is not so significant. Of course, there are question marks which we cannot answer to. One of the important question mark concerns the French market as the French market, so far, is very much in line with this -- what has been given out as a guidance from the previous government, but of course, this could be subject to change. We have to see what happens at what we call here in France la rentrée, when everybody comes back from holidays in September, October, if there will be additional projects. Beyond, we don't see anything significant until the end of the year. We have to see how Europe will be doing overall in 2013.

But, in general, Europe is clearly the most challenging region in the world today. We have the highest level of government reimbursement. That's why we've been very happy to see the percentage of our sales drop to 24%. Longer term, we see that dropping further, in fact, as a percentage of our overall sales. It's why businesses like Animal Health and Consumer Health are very important, because these are not subject to government price controls. On average, we've estimated the price impact to be of the order of EUR 300 million. It's not significantly different than past years. It's been said it's kind of part of doing business and what we've always expected. So it's unfortunate, because I think the pharmaceutical industry is sometimes picked upon too much. When governments are looking for austerity programs, drugs don't represent a big percentage of cost, and at the same time, they all want more investments in research and manufacturing. So it's just -- you can read the newspapers. You see what a difficult situation Europe is in, but I think we've taken that into account in our budgets and our guidance.

And can I just follow up very quickly on Aubagio? What it was -- what was it that actually triggered the extension? Did you have to file additional data?

That's just the normal to and fro of questions, and in the responses, they just decided they want a little bit more time. I mean, you know this division, Graham. That -- it's not unusual or exceptional.

The next question is from Jo Walton from Crédit Suisse. Jo Walton - Crédit Suisse AG, Research Division: I've got 2 questions, please. I wonder if you could tell us a little bit more about why Lantus is doing so well in the U.S. Prescriptions only seem to be growing at 4% or 5%, and yet, your sales are growing at 19%. Is there any stocking in here? Or is the IMF data increasingly unreliable? And Lantus in Europe seems only to be growing at 1% or 2%. Do you think that that is a level which we're likely to continue to see? And the second question is about your dengue vaccine. I know that you're very excited about that as an opportunity. The main big studies don't seem to conclude until 2014 or beyond. How realistic is it to be able to file, particularly for broad pediatric use, until those are all concluded?

First, I take Lantus. First go to the difficulties, which is Europe. Yes, what you see is moderate and modest in terms of value growth. The volume growth in year-to-date in Europe by the end of April is 9%, which means the negative difference comes from price. And we had a number of price reductions, most significant one in Europe, in France, given the size of the product in France, where we have the lower supplies, for example, by 5%, but there's only one example here. [indiscernible] was struck by a pharma price decrease in Germany, which we had to execute in 2011 in order to get a broader reimbursement situation, similar situation in Switzerland in [indiscernible] product finally at all reimbursements in Italy. So the product has swelled, but we have made concessions in price. If those remain the only concessions in price, you will see a very nice increase close to 2 digits in 2013, but of course, this cannot be granted. Now the American situation is an -- overall, a very healthy situation. We can see that we grow in each and every aspect, but we also have so to say very honestly and clearly that this is also supported by price increases. We have a price increase in approximately 12% in the overall growth in the U.S. But if you go more into detail, you see a very nice growth. In total prescriptions, you'll see an even more promising growth in terms of new prescriptions and new patients, which indicates that we probably will see even further accelerations in the quarters to come. All other trends are equally positively. We have a continued very nice increase in SoloSTAR usage. So the product, overall, does well I believe, because the product, intrinsically, is extremely strong. And as you may remember, we have taken the decision repetitively in 2010 and in 2011 to increase our promotional forces behind it, and evidently, our process is paying off.

Dengue vaccine, Olivier.

So dengue is a [indiscernible]. People -- there is no treatments, no prevention available against dengue. It's a major public health issue in Latin America and in Asia Pacific. It's the first time that both efficacy is demonstrated, but what is also extremely important is that the profile of the product is excellent in terms of safety and in terms of [indiscernible] ability. So we have said that based on the results of these kinds of studies and we'll be discussing with the regulatory authorities that's [indiscernible] between the endemic countries. That's where we will [indiscernible] with the regulatory [indiscernible], and then we will see. So [indiscernible], the proof of efficacy gives us a lot of comfort. More importantly is the safety of [indiscernible]. As you know that one of the concern of the new dengue vaccine was safety, and here, safety is really good.

The next question is from Mark Clark from Deutsche Bank.

I just want to take you back to the investor seminar from September last year, where as -- you set out the individual components of that 5% sales growth forecast with double digits in Emerging Markets, Genzyme; high single digit in Diabetes, Consumer Health; and Animal Health, mid-single digits. And I just wondered has anything in the intervening 12 months or nearly 12 months made you revisit any of those assumptions. Or do you still remain confident in each and every one of those assumptions? Clearly, in the last year, we've seen a lot worse pricing in Europe and so on and so forth. The macro environment has worsened. But I wonder if you could speak to your confidence in those targets.

I don't think really that anything has changed. And I think, actually, the performance you've seen, actually, in the 3 quarters since then have pretty much confirmed those. So I look at the business and I see it trending in the same path as when we looked at it this time last year before we did the medium-term guidance.

The next question is from Mr. Peter Verdult from Morgan Stanley.

Pete Verdult here from Morgan Stanley. Chris, we've heard some diverging views from other CEOs this week about the environment regarding business development. So firstly, I'd just be interested in your thoughts on BD and whether you think current valuations out there have become incrementally more or less attractive versus 12 months ago. And then just part b to the question is essentially use of cash. I mean, you've made it clear that dividend is your priority. We're fast approaching your net debt target. So in the absence of business development, I just want to know whether your stance on buybacks and share returns or buybacks has changed at all in the last 12 months.

Well, I mean I think -- I tell you, when I look at BD valuations, I'm glad we did Genzyme when we did. I think we would have had a lot more competition today and would potentially have had to [indiscernible] paying a higher price, not that I think we might have done that. There's no question that some companies have been through their bigger mergers and have become more active. I think a number of companies have had pipeline setbacks and are looking to replace things. And so if I look at Europe, U.S. at least in terms of BD, I think valuations are -- there may be some value to be found. In Emerging Markets, clearly, prices have gone up. So I think you have to go a little further. I mean, I think where we have been able to drive value is actually kind of trying to buy ahead of the curve. I suspect that you could never buy Medley today for what we paid for Medley in 2009 or even a Zentiva for that matter. So we're -- I'm not going to buy anything that I don't see having a value to the Sanofi shareholder. I get a lot of stuff presented to me by banks. It's immediately evident how I can make someone else's shareholders rich, but that's not what I'm paid to do. And I think we also -- I should point out you've got a number of members of the executive committee sitting around this table here. All of us have equity compensation programs, half of which is tied to return on investment criteria, so -- and I think we're probably the only major pharma company to do that. It's -- every conversation I have with investors is that one of the reasons…

The last question is from Mr. Vincent Meunier from Exane BNP.

A very simple one. The restructuring in France, can you please make an update on the situation with unions? And is there any risk you could not reach your target of cost cutting given the upcoming negotiations with the French government? You were talking about la rentrée and the fact that there will be also negotiations for drug prices. It could weigh in the balance during the negotiations also with unions.

I mean what we're doing in France is what we've already done in the rest of the world and I won't go through the whole model. I think you all understood where we want to go with our research model. This is really research, not development. We do want to align that with the key research ecosystems in the world and the creation of hubs. Genzyme has allowed us to take a much more transformative approach to research. The reality is, is that our research in France hasn't really come up with a new medicine in 20 years, and therefore, we have to take a much more productive approach to how we do this. It is a reorganization within France. It's not externalizing research to other countries. It is a top line model. And our -- and all the discussions we've had are that people really understand that. I mean there's no point having a national champion in research and development unless everybody sees that as being a very strong national champion. We clearly have to -- we are in France. We have to be seen to do this the way we do things in France here, and we are. Sanofi has a long tradition of social dialogue and treating our employees with care, and we continue to do that. But it's not really related to our cost reduction program per se. It's really about changing the R&D paradigm, which we've seen I think become successful in other countries. So we continue to -- we have not announced a formal plan. The idea was to have a period of dialogue and discussion, and that is going well so far. So we'll keep you updated as progress comes. Sébastien Martel: All right. We're now ready to just conclude. I'll ask Chris whether he wants to say any points to wrap up.

Yes. I mean I think Q2 is really just further evidence of management execution of what we have said we wanted to do. You've got a very stable business perimeter. I think the Genzyme integration has gone extremely well. We're now on a like-for-like basis as we look at quarters with Genzyme, so you have an opportunity to look at the growth platforms on an organic basis. And I think the growth platforms have all done I think very well. And I think we've been able to demonstrate some outperformance even in some areas versus our competitors. Certainly, I think the fundamental strength of Sanofi in Emerging Markets I think can be seen. We're not subject to a few countries. We are probably more geographically diversified than anybody else, and we do have strength in market, including more relevant product portfolios and production levels. I think you've also seen us be very disciplined on cost management. I think what I'm particularly proud of is that our commercial teams have been able to deliver sales performance while we have been actually executing a tight cost performance, because we are clearly also investing in things like prelaunch. I mean, the multiple sclerosis investment, for example, doesn't start next year. We have been investing already this year significant amounts in things like multiple sclerosis. There is significant new investment going on in the PCSK9 Phase III program. We are clearly funding a very ambitious Phase III program in the dengue vaccine. We have a very important Phase III program ongoing in U300. So it's not hard to actually cut cost. What's really difficult is to be able to fund the things that are for growth in the medium term and still meet the short-term objectives. And I think management teams here are showing…

Ladies and gentlemen, this now concludes our conference call. Thank you all very much for attending.