When a pharmaceutical company's CFO tells you straight up that a blockbuster drug is "too big to be mitigated," you know you're dealing with either refreshing honesty or a serious problem. For Sanofi SA (SNY), it's probably both.

The French drugmaker reported fourth-quarter sales of $13.159 billion (11.30 billion euros) on Thursday, falling short of the $13.41 billion consensus estimate. But here's the thing: sales still jumped 7% year over year, or 13.3% in constant currency. That's the kind of growth that would make most companies celebrate, except there's this looming patent expiration situation.

Dupixent Dominance

The star of the show remains Dupixent, Sanofi's eczema and asthma treatment that continues to print money. Fourth-quarter sales for the drug rocketed 32.2% to 4.2 billion euros, marking the second time it's crossed the four billion euro threshold in a single quarter. Strong volume growth across all approved indications drove the performance.

CEO Paul Hudson sounded pretty pleased in the earnings release: "In the fourth quarter, sales growth accelerated to 13.3%, delivering another strong performance. Growth was supported by new medicines and Dupixent, reaching a new quarterly high. Business EPS was up by 26.7% with the benefit of cost discipline and growth leverage."

U.S. sales particularly shined, climbing 22.6% to 5.80 billion euros. Beyond Dupixent, the company's pharma launches gained serious momentum, surging 49.4% to 1.1 billion euros thanks to Ayvakit and ALTUVIIIO. Speaking of which, ALTUVIIIO crossed the $1 billion blockbuster threshold in 2025, giving Sanofi another heavy hitter in its lineup.

The Uncomfortable Truth

Now for the reality check. "We believe that we will not be able to mitigate the impact of the (loss of exclusivity) of Dupixent as far as sales are concerned. It's too big to be mitigated," CFO François-Xavier Roger told Reuters. That's the kind of statement that makes investors sit up straight.

Roger did offer some reassurance, noting that Sanofi aims to offset the earnings per share impact by leveraging existing products, advancing its pipeline through 2031, and pursuing external acquisitions. The company's already made moves on that front, including its recent adult vaccine play.

Mixed Vaccine Picture

While Dupixent soared, the vaccine business showed some cracks. Overall vaccine sales dipped 2.5% to 2 billion euros. Beyfortus sales fell 14.9% to 686 million euros, and Polio/Pertussis/Hib vaccines dropped 9.5% to 551 million euros, partly because fewer babies are being born in countries like China. On the bright side, influenza and COVID-19 vaccine sales jumped 31.5% to 575 million euros, performing better than expected.

Roger told Reuters the vaccine business faces headwinds this year, expecting slightly negative sales partly due to policy shifts under the Trump administration. Not exactly the growth trajectory you want to hear about.

Looking Forward

Despite the Dupixent challenge ahead, Sanofi's reported fourth-quarter business operating income of 2.34 billion euros, up 12.7% year over year. Adjusted EPS came in at 1.53 euros (89 cents per ADS), beating the 84 cent consensus and jumping 26.7% in constant currency.

For 2026, the company expects sales to grow by a high single-digit percentage at constant exchange rates. Business EPS should grow slightly faster than sales before factoring in the planned 1 billion euro share buyback program. Hudson struck an optimistic tone, saying he anticipates profitable growth to continue for at least five years.

The bottom line? Sanofi's riding high on Dupixent's momentum right now, but management's already warning investors not to expect a magic replacement when the patent cliff arrives. At least they're being honest about it.

SNY Price Action: Sanofi shares were up 0.63% at $46.06 during premarket trading on Thursday.