Engagement update with Sanofi
As part of our broader work on conflict minerals, we recently engaged with pharmaceutical company Sanofi. Ffion Spencer updates on progress, along with two additional sector-specific issues that were also raised: the use of animal-derived ingredients and plastic reduction.
We met with the French pharmaceutical company to discuss its potential exposure to conflict minerals in more detail, alongside wider E.S.T. (environmental, social, transparency and governance) considerations including plastic use and animal derived ingredients.
Conflict Minerals
Sanofi had been flagged by our research provider, Ethical Screening, as potentially using tin, tantalum, tungsten and gold (collectively known as ‘3TG minerals’) within its operations. The objective of the call was to understand whether and how these minerals feature in Sanofi’s supply chain and to assess the company’s approach to identifying and managing any associated risks.
Sanofi confirmed that it does not use conflict minerals in its products and noted that although gold had previously been used in one product, this has since been fully phased out and replaced.
Sanofi confirmed that it does not use conflict minerals in its products and noted that although gold had previously been used in one product, this has since been fully phased out and replaced.
The company provided an overview of its supply chain assessment, which included an internal review of its product portfolio and supply chain that initially identified around 450 suppliers potentially in scope. 350 suppliers were assessed by a third party vendor, who engaged directly with suppliers to confirm the absence of 3TG minerals by using the Conflict Minerals Reporting Template.
The company continues to monitor potential exposure through its supplier management processes, with conflict minerals requirements now embedded in its supplier code of conduct. Clarifying whether the company uses these minerals is a useful exercise for us as investors as it enables us to evaluate exposure to regulatory, operational and reputational risks associated with conflict mineral sourcing.
Use of Plastics
Sanofi explained that it does not consider itself a material contributor to plastic waste, given the nature of its products and the controlled environments in which they are typically used. Despite this, the company is working to reduce plastics wherever feasible, with the main exception being the primary packaging that comes into direct contact with the pharmaceutical product and is therefore subject to strict regulatory and safety requirements.
We are encouraged that Sanofi has made good progress in several areas. In its vaccines business, plastic secondary packaging has now largely been replaced with fully recyclable, plastic-free cardboard cartons.
We are encouraged that Sanofi has made good progress in several areas. In its vaccines business, plastic secondary packaging has now largely been replaced with fully recyclable, plastic-free cardboard cartons. The company is targeting the elimination of plastics across vaccine packaging by 2027, aside from syringes where no viable alternatives currently exist.
For injectable products, plastics remain necessary within devices, but Sanofi is collaborating with industry partners on recovery and take back schemes, such as programmes for used insulin pens. These initiatives demonstrate a proactive approach to managing downstream waste impacts, which is increasingly relevant as extended producer responsibility frameworks evolve.
Sanofi shared that PVC blisters for tablets and pills remain difficult to replace due to their stability and shelf life performance, but noted that overall waste volumes from these formats are relatively small. The company has also achieved secondary benefits from its packaging reduction efforts, including smaller and more compact boxes that contribute to lower carbon emissions. These operational efficiencies subsequently support the broader decarbonisation goals we often push for.
Looking ahead, Sanofi sees opportunities to extend its plastic reduction initiatives to other injectable products and to expand take back schemes where feasible. The company is also transitioning from paper leaflets to QR codes in some markets where regulatory acceptance allows.
Sanofi Impact has already implemented QR code based information successfully in global health programmes, enabling patients to access materials in their preferred language. We view these developments positively, as they signal a willingness to adopt digital solutions that can reduce waste, while also improving patient experience.
Animal- Derived Ingredients
Lastly, we discussed the use of animal derived ingredients in Sanofi’s products, a topic raised by clients. The company explained that some animal derived inputs remain necessary within its portfolio, largely due to regulatory requirements and the absence of viable synthetic alternatives.
Sanofi noted that it has previously engaged with stakeholders on related issues, including halal compliance in markets such as Indonesia, where certification is increasingly important and where expectations around products being inclusive of dietary needs continue to grow. The company shared that while it has been able to replace some products, pig derived ingredients remain the greatest challenge, as no practical substitutes currently exist.
In vaccines, Sanofi shared that it has received similar queries in the past relating to allergies. We learned that many flu vaccines are still grown using eggs, which can pose issues for individuals with egg allergies. The company has developed an egg free alternative, although it is more costly to produce, and is exploring synthetic approaches that could replicate the required proteins without relying on animal inputs.
While certain jurisdictions have begun loosening requirements around animal testing, much of this progress has occurred in the cosmetics sector rather than pharmaceuticals, where safety and efficacy standards remain more stringent.
Similar to other discussions we have had in the past with pharmaceutical companies, Sanofi was transparent with the fact that regulatory constraints remain a significant barrier to change. Some markets, including Japan, have strict requirements that limit the ability to switch away from animal derived inputs, even when alternatives exist.
While certain jurisdictions have begun loosening requirements around animal testing, much of this progress has occurred in the cosmetics sector rather than pharmaceuticals, where safety and efficacy standards remain more stringent. As a result, progress in this area will depend heavily on regulatory alignment, which will ultimately determine the pace at which companies can transition to non animal substitutes.
Outcome
Our engagement provided reassurance that Sanofi does not use conflict minerals in its products and has a structured approach to conflict minerals due diligence. We also gained comfort that the company is making tangible progress on reducing plastics in its packaging and is actively exploring alternatives to animal derived ingredients where feasible.
Written by Ffion Spencer
This article was originally published as part of our Q4 2025 Investment Management Report (IMR).
Information is accurate as at 13.01.2026. Opinions constitute the fund manager’s judgement as of this date and are subject to change without warning. The officers, employees and agents of CIP may have positions in any securities mentioned herein. This material may not be distributed, published or reproduced in whole or in part. With investment, capital is at risk.