Sanofi-Aventis beat second-quarter earnings expectations as it beefed up sales and tightened its R&D spending, but the French drugmaker gave no hint in its results statement of any acquisition plans.

Sources told Reuters late on Wednesday that Sanofi plans to make a formal offer of up to $18.7 billion, or $70 per share, for U.S. biotech Genzyme as it seeks to replenish its drug pipeline and make up for the loss of patent protection on blockbuster drugs in the years through 2013.

Quarterly earnings beat the average outcome of a Reuters poll on all fronts as Sanofi tightened spending, and as sales were driven by its diabetes division, emerging markets and consumer health.

Business net income rose 7.6% to €2.478 billion versus the poll's average of €2.32 billion. Earnings per share climbed 8% to €1.90 versus the poll's €1.78.

Sales increased 4.6% to €7.783 billion even as competition grew from generic copies of bloodthinner Plavix and cancer drug Eloxatin, and as vaccine sales declined.

The U.S. health regulator's approval of a generic to bloodthinner Lovenox led Sanofi last week to cut its earnings per share forecast to between stable and 4% lower at constant exchange rates from 2-5% growth against 2009.

For 2013, Sanofi expects sales to be at least at 2008's level of 27.57 billion, and business net income to be similar to the 2008 level of €7.314 billion.

Those forecasts take into account the arrival of a Lovenox copy as well as government healthcare spending cuts, and exclude acquisitions above €1 billion, like consumer health company Chattem and a stake in Merial animal health that Sanofi did not already own.

Sanofi expected cost savings, including on R&D, to exceed €1 billion at constant exchange rates this year from the 2008 level and compared with a 2013 savings goal of €2 billion.

Mum On Mergers
In its earnings statement on Thursday, Sanofi did not comment on its acquisition strategy for which CEO Chris Viehbacher has set a limit of €15 billion, though never entirely dismissing a bigger deal.

Last year, Sanofi invested €6.6 billion on 33 new partnerships and acquisitions and has said it would do a similar number of deals this year to further branch out its business and address unmet medical needs.

A bigger move could be on the cards, however, as more than a fifth of Sanofi's 2008 drug sales - excluding a generic Lovenox - face patent expiries to 2013, and its drug portfolio can't offset that loss.

Sanofi's net debt rose to €6.17 billion in the first half from 4.14 billion at end-2009, while net cash from operating activities stood at €4.2 billion.