French Healthcare Group Sanofi Priced First Sustainability-Linked Bond Indexed on Access to Medicines in Low-Middle-Income Countries

Published on: 01 April 2022
by KnowESG

Sanofi, a French multinational healthcare company, successfully priced its offering of a double tranche of 1.5 billion euro banknotes. The transaction entails the initial issue of a sustainability-linked bond for a nominal amount of EUR 650 million of notes to increase access to medicines in lower-middle-income countries through its global health nonprofit unit.

The banknotes comprise two tranches: first, €850 million fixed-rate notes, bearing an interest of 0.875 per cent annually that is due in April 2025. Second, €650 million fixed-rate notes, with 1.250 per cent annual interest due in April 2029. The coupon amount is connected to the sustainability target of providing at least 1.5 million patients with essential medicines for treating non-communicable diseases in more than 40 economically backward and developing countries between 2022 and 2026.

Jean-Baptiste de Chatillon, Chief Financial Officer of Sanofi, said: "A year after pioneering sustainable finance with our sustainability-linked revolving credit facilities, we further contribute to the development of the sustainable finance market through the successful pricing of our first sustainability-linked bond. We continue to make progress in our environmental, social and governance activities that are an essential part of our strategy and embedded into our business.”

Sanofi's social strategic aim includes building a healthier world by providing access to healthcare for people in developing and underdeveloped economies worldwide and zeroes in on the treatment of childhood cancer.

The company has committed to fighting against dangerous and infectious diseases, including sleeping sickness and poliomyelitis and accelerating its goals to reduce the environmental impact of its products and business operation.

Sanofi, using its dedicated Sustainability-Linked Bond Framework to become an issuer of sustainable finance instruments, will help enable future bond issues in a sustainability-linked format. The framework has been designed according to ICMA's Sustainability-Linked Bond Principles (2020). The money generated from the bond will be used for general corporate purposes.

Sandrine Bouttier-Stref, Global Head of Corporate Social Responsibility of Sanofi, said: “Linking the cost of financing to the achievement of concrete targets in terms of access to medicines confirms our determination to put social responsibility at the centre of our ambitions.”

Morgan Stanley, Natixis, Barclays, MUFG and RBC Capital Markets led the transaction.