Discover how a leading French pharmaceutical company transitioned from localized credit insurance initiatives to a centralized global credit risk management program to drive international growth.
About Servier
Servier, France’s second-largest pharmaceutical group and the 34th largest globally, is an independent international organization founded in 1954. Specializing in cardiovascular diseases, oncology, diabetes, immune disorders, and neuropsychiatry, Servier produces both proprietary medications and generics, including Biogaran, a market leader in France.
The company’s 21,400 employees deliver innovative healthcare solutions to patients across 150 countries. In 2022, Servier achieved €4.9 billion in revenue, marking a 10% increase from the previous year, with an EBITDA of 18%, highlighting its profitability and robust value-creation model.
“Limited visibility of global client risk on our business portfolio”
Servier, a Coface client since 2016, is a key player in the pharmaceutical industry, generating over half its revenue outside the European Union. With its headquarters in France, Servier operates in 150 countries through subsidiaries and third-party importers. Its prescription drug business has grown organically, while the generics division expanded internationally through acquisitions. Examples include the purchase of EGIS in Hungary, which enabled Servier to penetrate markets like Poland, Russia, and Romania, as well as acquisitions in Nigeria and Brazil, two strategic markets.
Despite its international footprint, Servier initially lacked centralized credit insurance expertise. Its approach relied on disparate policies across a few countries.
Our trade credit insurance practice was derived from local initiatives, which were managed asymmetrically by the relevant entities, each with its own provisions, contractual terms and conditions, local challenges and respective needs. We shared basic good practices in credit management, but Servier Central’s visibility remained limited, as was the control of global client risk on our business portfolio.
explains Cédric DONDAIN, International Treasurer and head of credit management at Servier.
Recognizing the need for a cohesive strategy, Servier collaborated with its broker, AON, in 2016 to initiate a global tender. The goal was to optimize credit risk management and extend the solution across the organization globally.
A global programme for breaking into new markets
After consultations with top credit insurance providers (Allianz Trade, Atradius, and Coface), Servier selected Coface for its multinational solutions, specifically Coface Global Solutions (CGS). Coface’s team designed a global program tailored to Servier’s needs, focusing on balancing risk distribution and centralizing contract management.
This global solution, tailored to our needs, had the advantage of covering the risks in the different geographical locations of a global company like ours. The quality of Coface's business information about our pharmaceutical distributor clients made the difference too.
notes Cédric DONDAIN.
The program also includes dedicated support from Coface, such as a Lead Risk Underwriter and a Program Manager, along with a centralized reporting tool via the CGS Dashboard. This platform offers a complete overview of risks, evaluations, and credit ratings across participating countries.
“It was a big challenge. We started from scratch, but we managed to build a coherent programme that is robust and productive enough to support Servier's strategic challenges to conquer new international markets”, underlines Borislav TODOROV, Head of CGS Account Management at Coface France.
With a strong foundation in cardiovascular and metabolic diseases, Servier is also focusing on oncology, particularly treatments for blood cancers like leukemia. Oncology now represents 18% of the company’s revenue, driven by acquisitions such as Shire’s oncology portfolio in 2018 and AGIOS’ in 2021. These strategic moves have facilitated Servier’s entry into the U.S. market.
“The time value and quality of our collaboration have had a positive impact on the productivity gains of our programme”
Since launching the credit insurance program in 2016, five new subsidiaries have joined, reflecting the program’s effectiveness.
"Every one of these countries has seen their turnover go up and their coverage rate improve! It’s all the more vital for Servier since subsidiaries are not obliged to sign up. This means we have to convince them that the programme is useful and effective not just for them but also in the collective interest and for pooling risk, which is important for the insurer. What’s more, one of our subsidiaries – which was a bit hesitant to start with – suffered a claim but without it being a total write-off. So it was clear to them just how advantageous it was to have credit insurance!! " adds Cédric DONDAIN.
Servier’s trust in Coface is evidenced by the program’s renewal every two years without retendering. The program now includes 28 policies across 26 countries, covering €1.5 billion in insurable revenue—a tenfold increase since its inception.
“The time value and quality of our collaboration have a positive impact on our programme’s high performance levels. We benefit from access to local risk underwriters, and we can also escalate up to Coface France. The good reciprocal knowledge between our two Groups, combined with the risk underwriters’ expertise and experience, enables us to adjust our coverage needs quickly – and, in tandem, the insurer's exposure – in economic environments that might well deteriorate rapidly”, concludes Cédric DONDAIN.
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*EBIDTA: balance between operating income and expenses to obtain these results. It is estimated by adding profit from operating activities (otherwise known as EBIT) to depreciations and amortisations.
