##### Table of Contents





UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



FORM 20-F



(Mark One)



| ̈ | REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------------

OR

|x | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ------------------------------------------------------------------------------------

For the fiscal year ended December 31, 2010

OR

| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------

OR

| ̈ | SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | -------------------------------------------------------------------------------------------

Date of event requiring this shell company report . . . . . . . . . . . . . . . . . . .

For the transition period from              to

Commission File Number: 001-31368



Sanofi-Aventis

(Exact name of registrant as specified in its charter)

N/A

(Translation of registrants name into English)

France

(Jurisdiction of incorporation or organization)

174, avenue de France, 75013 Paris, France

(Address of principal executive
offices)



Karen Linehan, Senior Vice President Legal Affairs and General Counsel

174, avenue de France, 75013 Paris, France. Fax: 011 + 33 1 53 77 43 03. Tel: 011 + 33 1 53 77 40 00

(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)



Securities
registered or to be registered pursuant to Section 12(b) of the Act:

|                                                                                                     |  |                                                    
|---------------------------------------------------------------------------------------------------- |  | ---------------------------------------------------
|Title of each class:                                                                                 |  | Name of each exchange
on which registered:         
|American Depositary Shares, each representing one half of one ordinary share, par value 2 per
share |  | New York Stock Exchange                            
|                                                                                                     | 
|Ordinary shares, par value 2 per share                                                              |  | New York Stock Exchange (for listing purposes only)

Securities registered pursuant to
Section 12(g) of the Act:

American Depositary Shares, each representing one quarter of a
Participating Share Series A, par value 70.89 per share (removed from listing and registration on the New York Stock Exchange effective July 31, 1995).

The number of outstanding shares of each of the issuers classes of capital or

common stock as of December 31, 2010 was:

Ordinary
shares:    1,310,997,785

Indicate by check mark if the registrant is a well-known seasoned issuer, as
defined in Rule 405

of the Securities Act.

YES   x        NO   ̈.

If this report is an annual or transition report, indicate by check mark if the registrant is not

required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

YES   ̈        NO  x.

Indicate by check mark whether the registrant (1) has
filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.

Yes  x        No   ̈

Indicate by check mark whether the registrant has submitted
electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter
period that the registrant was required to submit and post such files).

Yes  x         No   ̈

Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of accelerated filer and large accelerated filer in Rule 12b-2 of the Exchange Act. (Check one):

|                           |  |                      |  |                         
|-------------------------- |  | -------------------- |  | ------------------------
|Large accelerated filer  x |  | Accelerated filer   ̈ |  | Non-accelerated filer   ̈

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included
in this filing:

U.S.
GAAP   ̈        International Financial Reporting Standards as issued by the International Accounting Standards Board  x        Other   ̈

If Other has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.

Item 17   ̈        Item 18 
  ̈

If this is an annual report, indicate by check mark whether the
registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

YES   ̈        NO  x.







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PRESENTATION OF FINANCIAL AND OTHER INFORMATION



The consolidated financial statements contained in this
annual report on Form 20-F have been prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB) and with IFRS as adopted by the European Union, as of
December 31, 2010.







Unless the context requires otherwise, the terms
sanofi-aventis, the Company, the Group, we, our or us refer to sanofi-aventis and its consolidated subsidiaries.



All references herein to United States or U.S. are to the United States of America,
references to dollars or $ are to the currency of the United States, references to France are to the Republic of France, and references to euro and  are to the currency of the
European Union member states (including France) participating in the European Monetary Union.



Brand names appearing in this annual report are trademarks of sanofi-aventis and/or its affiliates, with the exception of:



| |  | trademarks used or that may be or have been used under license by sanofi-aventis and /or its affiliates, such as Acrel® and Actonel® trademarks of Warner Chilcott ;
BiTE® a trademark of Micromet Inc., Copaxone® a trademark of Teva Pharmaceuticals Industries ; Cortizone-10® a trademark of Johnson & Johnson (except in the United-States where it is a trademark of the Group) ; epiCard a trademark of Intelliject ;
Gardasil® a trademark of Merck&Co. ; Mutagrip® a trademark of Institut Pasteur ;
Optinate® a trademark of Warner Chilcott on certain geographical areas and of Shionogi Pharma Inc. in the United
States ; Pancréate a trademark of CureDM ; and
RotaTeq® a trademark of Merck&Co. ;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | trademarks sold by sanofi-aventis and/or its affiliates to a third party, such as DDAVP® a trademark of Ferring (except in the United States where it is a trademark of the Group) ; Liberty®, LibertyLink® and StarLink® trademarks of Bayer ; and Maalox® a trademark of Novartis in the United States, Canada and Puerto Rico; and,
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | other third party trademarks such as ACT® a trademark of Johnson & Johnson on certain geographical areas (except the United States where it is a trademark of the Group) ; Aspirine® and Cipro® trademarks of Bayer ;
Humaneered a trademark of KaloBios Pharmaceuticals ;
IC31® a trademark of Intercell ; LentiVector® and RetinoStat® trademarks of
Oxford BioMedica ; Libertas a trademark of APOTEX in the United States and of International Contraceptive
& SRH Marketing Limited in the United Kingdom ; MIMIC® a trademark of ROHM AND HAAS COMPANY ; Rotarix® a trademark of GSK ; Unisom® a trademark of Johnson & Johnson on certain geographical areas (except the United States where it is a trademark of the Group) ; and Cerezyme®, Fabrazyme® and Lemtrada trademarks of
Genzyme Corporation.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------







The data relative to market shares and ranking information for pharmaceutical products presented in particular in Item 4.
Information on the Company  B. Business Overview  Markets  Marketing and distribution are based on sales data from IMS Health MIDAS (IMS), retail and hospital, for calendar year 2010, in constant euros (unless otherwise
indicated).



While we believe that the IMS sales
data we present below are generally useful comparative indicators for our industry, they may not precisely match the sales figures published by the companies that sell the products (including our company and other pharmaceutical companies). In
particular, the rules used by IMS to attribute the sales of a product covered by an alliance or license agreement do not always exactly match the rules of the agreement.



In order to allow a reconciliation with our basis of
consolidation as defined in Item 5. Operating and Financial Review and Prospects  Presentation of Net Sales, IMS data shown in the present document have been adjusted and include:



| | (i) | sales as published by IMS excluding sanofi-aventis sales generated by the vaccines business, equating to the scope of our pharmaceutical operations;
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------



| | (ii) | adjustments to data for Germany, the Netherlands, Denmark, Norway and Sweden, to reflect the significant impact of parallel imports;
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------



| | (iii) | IMS sales of products sold under alliance or license agreements which we recognize in our consolidated net sales but which are not attributed to us in the reports
published by IMS;
| | ----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| | (iv) | adjustments related to the exclusion of IMS sales for products which we do not recognize in our consolidated net sales but which are attributed to us by IMS; and
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (v) | sales of Brazilian panel at constant wholesalers perimeter.
| | --- | ------------------------------------------------------------



Data relative to market shares and ranking information presented herein for
our vaccines business are based on internal estimates unless stated otherwise.







Product indications described in this annual report are composite summaries of the major indications approved in the products
principal markets. Not all indications are necessarily available in each of the markets in which the products are approved. The summaries presented herein for the purpose of financial reporting do not substitute for careful consideration of the full
labeling approved in each market.







CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS



This annual report contains forward-looking statements. We
may also make written or oral forward-looking statements in our periodic reports to the Securities and Exchange Commission on Form 6-K, in our annual report to shareholders, in our offering circulars and prospectuses, in press releases and other
written materials and in oral statements made by our officers, directors or employees to third parties. Examples of such forward-looking statements include:



| |  |  | projections of operating revenues, net income, business net income, earnings per share, business earnings per share, capital expenditures, cost
savings, restructuring costs, positive or negative synergies, dividends, capital structure or other financial items or ratios;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | statements of our plans, objectives or goals, including those relating to products, clinical trials, regulatory approvals and competition; and
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | statements about our future economic performance or that of France, the United States or any other countries in which we operate.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------



This information is based on
data, assumptions and estimates considered as reasonable by the Company and undue reliance should not be placed on such statements.



Words such as believe, anticipate, plan, expect, intend, target,
estimate, project, predict, forecast, guideline, should and similar expressions are intended to identify forward-looking statements but are not the exclusive means of
identifying such statements.



Forward-looking
statements involve inherent, known and unknown, risks and uncertainties associated with the regulatory, economic, financial and competitive environment, and other factors that could cause future results and objectives to differ materially from those
expressed or implied in the forward-looking statements. We caution you that a number of important factors could cause actual results to differ materially from those contained in any forward-looking statements. Such factors, some of which are
discussed under Item 3. Key Information  D. Risk Factors below, include but are not limited to:



| |  |  | approval of generic versions of our products in one or more of their major markets;
| | - |  | -----------------------------------------------------------------------------------



| |  |  | product liability claims;
| | - |  | -------------------------



| |  |  | our ability to renew our product portfolio;
| | - |  | -------------------------------------------



| |  |  | the increasingly challenging regulatory environment for the pharmaceutical industry;
| | - |  | ------------------------------------------------------------------------------------



| |  |  | uncertainties over the pricing and reimbursement of pharmaceutical products;
| | - |  | ----------------------------------------------------------------------------



| |  |  | fluctuations in currency exchange rates; and
| | - |  | --------------------------------------------



| |  |  | slowdown of global economic growth.
| | - |  | -----------------------------------



We caution you that the foregoing list of factors is not exclusive and that other risks and uncertainties may cause actual results to
differ materially from those in forward-looking statements. Additional risks, not currently known or considered immaterial by the Company, may have the same unfavorable effect and investors may lose all or part of their investment.



Forward-looking statements speak only as of the date they are
made. Other than required by law, we do not undertake any obligation to update them in light of new information or future developments.



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TABLE OF CONTENTS



|          |  |                                                                        |  |    
|--------- |  | ---------------------------------------------------------------------- |  | ---
|Part I    |  |                                                                        |  |    
|Item 1.   |  | Identity of Directors, Senior Management and Advisers                  |  | 1  
|Item 2.   |  | Offer Statistics and Expected Timetable                                |  | 1  
|Item 3.   |  | Key Information                                                        |  | 1  
|          |  | A. Selected Financial Data                                             |  | 1  
|          |  | B. Capitalization and Indebtedness                                     |  | 3  
|          |  | C. Reasons for Offer and Use of Proceeds                               |  | 3  
|          |  | D. Risk Factors                                                        |  | 4  
|Item 4.   |  | Information on the Company                                             |  | 14 
|          |  | A. History and Development of the Company                              |  | 15 
|          |  | B. Business Overview                                                   |  | 16 
|          |  | C. Organizational Structure                                            |  | 66 
|          |  | D. Property, Plant and Equipment                                       |  | 66 
|Item 4A.  |  | Unresolved Staff Comments                                              |  | 69 
|Item 5.   |  | Operating and Financial Review and Prospects                           |  | 70 
|Item 6.   |  | Directors, Senior Management and Employees                             |  | 118
|          |  | A. Directors and Senior Management                                     |  | 118
|          |  | B. Compensation                                                        |  | 130
|          |  | C. Board Practices                                                     |  | 141
|          |  | D. Employees                                                           |  | 145
|          |  | E. Share Ownership                                                     |  | 148
|Item 7.   |  | Major Shareholders and Related Party Transactions                      |  | 152
|          |  | A. Major Shareholders                                                  |  | 152
|          |  | B. Related Party Transactions                                          |  | 154
|          |  | C. Interests of Experts and Counsel                                    |  | 154
|Item 8.   |  | Financial Information                                                  |  | 155
|          |  | A. Consolidated Financial Statements and Other Financial Information   |  | 155
|          |  | B. Significant Changes                                                 |  | 156
|Item 9.   |  | The Offer and Listing                                                  |  | 157
|          |  | A. Offer and Listing Details                                           |  | 157
|          |  | B. Plan of Distribution                                                |  | 158
|          |  | C. Markets                                                             |  | 158
|          |  | D. Selling Shareholders                                                |  | 159
|          |  | E. Dilution                                                            |  | 159
|          |  | F. Expenses of the Issue                                               |  | 159
|Item 10.  |  | Additional Information                                                 |  | 160
|          |  | A. Share Capital                                                       |  | 160
|          |  | B. Memorandum and Articles of Association                              |  | 160
|          |  | C. Material Contracts                                                  |  | 176
|          |  | D. Exchange Controls                                                   |  | 179
|          |  | E. Taxation                                                            |  | 179
|          |  | F. Dividends and Paying Agents                                         |  | 185
|          |  | G. Statement by Experts                                                |  | 185
|          |  | H. Documents on Display                                                |  | 185
|          |  | I. Subsidiary Information                                              |  | 185
|Item 11.  |  | Quantitative and Qualitative Disclosures about Market Risk             |  | 186
|Item 12.  |  | Description of Securities other than Equity Securities                 |  | 191
|Part II   |  |                                                                        |  |    
|Item 13.  |  | Defaults, Dividend Arrearages and Delinquencies                        |  | 198
|Item 14.  |  | Material Modifications to the Rights of Security Holders               |  | 198
|Item 15.  |  | Controls and Procedures                                                |  | 198
|Item 16.  |  | [Reserved]                                                             |  | 198
|Item 16A. |  | Audit Committee Financial Expert                                       |  | 198
|Item 16B. |  | Code of Ethics                                                         |  | 199
|Item 16C. |  | Principal Accountants Fees and Services                               |  | 199
|Item 16D. |  | Exemptions from the Listing Standards for Audit Committees             |  | 199
|Item 16E. |  | Purchases of Equity Securities by the Issuer and Affiliated Purchasers |  | 199
|Item 16F. |  | Change in Registrants Certifying Accountant                           |  | 199
|Item 16G. |  | Corporate Governance                                                   |  | 199
|Part III  |  |                                                                        |  |    
|Item 17.  |  | Financial Statements                                                   |  | 201
|Item 18.  |  | Financial Statements                                                   |  | 201
|Item 19.  |  | Exhibits                                                               |  | 201



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##### Table of Contents

PART I



Item 1. Identity of Directors, Senior
Management and Advisers



N/A



Item 2. Offer Statistics and Expected
Timetable



N/A



Item 3. Key Information



A. Selected Financial Data



SUMMARY OF SELECTED FINANCIAL DATA



The tables below set forth selected
consolidated financial data for sanofi-aventis. These financial data are derived from the sanofi-aventis consolidated financial statements. The sanofi-aventis consolidated financial statements for the years ended December 31, 2010, 2009 and
2008 are included in Item 18 of this annual report.



The consolidated financial statements of sanofi-aventis for the years ended December 31, 2010, 2009 and 2008 have been prepared in compliance with IFRS issued by the International Accounting
Standards Board (IASB) and with IFRS adopted by the European Union as of December 31, 2010. The term IFRS refers collectively to international accounting and financial reporting standards (IAS and IFRS) and to interpretations of the
interpretations committees (SIC and IFRIC) mandatorily applicable as of December 31, 2010.



Sanofi-aventis reports its financial results in euros.



1



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SELECTED CONDENSED FINANCIAL INFORMATION



|                                                                                                               |  |                                           |        |     |      |  |        |      |  |  |        |  |  |      |        |  |  |  |        | 
|-------------------------------------------------------------------------------------------------------------- |  | ----------------------------------------- | ------ | --- | ---- |  | ------ | ---- |  |  | ------ |  |  | ---- | ------ |  |  |  | ------ | 
|                                                                                                               |  | As of and for the year ended December 31, |       
|( million, except per share data)                                                                             |  | 2010                                      |        |     | 2009 |  |        | 2008 |  |  | 2007   |  |  | 2006 |       
|IFRS Income statement data                                                                                     |  |                                           |        |     |      |  |        |      |  |  |        |  |  |      |        |  |  |  |        | 
|Net sales                                                                                                      |  |                                           | 30,384 |     |      |  | 29,306 |      |  |  | 27,568 |  |  |      | 28,052 |  |  |  | 28,373 | 
|Gross profit                                                                                                   |  |                                           | 23,318 |     |      |  | 22,869 |      |  |  | 21,480 |  |  |      | 21,636 |  |  |  | 21,902 | 
|Operating income                                                                                               |  |                                           | 5,961  |     |      |  | 6,366  |      |  |  | 4,394  |  |  |      | 5,911  |  |  |  | 4,828  | 
|Net income excluding the held-for-exchange Merial business attributable to equity holders of sanofi-aventis(a) |  |                                           | 5,081  |     |      |  | 5,090  |      |  |  | 3,731  |  |  |      | 5,112  |  |  |  | 3,918  | 
|Net income attributable to equity holders of sanofi-aventis                                                    |  |                                           | 5,467  |     |      |  | 5,265  |      |  |  | 3,851  |  |  |      | 5,263  |  |  |  | 4,006  | 
|Basic earnings per share () (b):                                                                              |  |                                           |        |     |      |  |        |      |  |  |        |  |  |      |        |  |  |  |        | 
|Net income excluding the held-for-exchange Merial business attributable to equity holders of sanofi-aventis(a) |  |                                           | 3.89   |     |      |  | 3.90   |      |  |  | 2.85   |  |  |      | 3.80   |  |  |  | 2.91   | 
|Net income attributable to equity holders of sanofi-aventis                                                    |  |                                           | 4.19   |     |      |  | 4.03   |      |  |  | 2.94   |  |  |      | 3.91   |  |  |  | 2.97   | 
|Diluted earnings per share () (c):                                                                            |  |                                           |        |     |      |  |        |      |  |  |        |  |  |      |        |  |  |  |        | 
|Net income excluding the held-for-exchange Merial business attributable to equity holders of sanofi-aventis(a) |  |                                           | 3.88   |     |      |  | 3.90   |      |  |  | 2.85   |  |  |      | 3.78   |  |  |  | 2.88   | 
|Net income attributable to equity holders of sanofi-aventis                                                    |  |                                           | 4.18   |     |      |  | 4.03   |      |  |  | 2.94   |  |  |      | 3.89   |  |  |  | 2.95   | 
|IFRS Balance sheet data                                                                                        |  |                                           |        |     |      |  |        |      |  |  |        |  |  |      |        |  |  |  |        | 
|Goodwill and other intangible assets                                                                           |  |                                           | 44,411 |     |      |  | 43,480 |      |  |  | 43,423 |  |  |      | 46,381 |  |  |  | 52,210 | 
|Total assets                                                                                                   |  |                                           | 85,264 |     |      |  | 80,251 | (g)  |  |  | 71,987 |  |  |      | 71,914 |  |  |  | 77,763 | 
|Outstanding share capital                                                                                      |  |                                           | 2,610  |     |      |  | 2,618  |      |  |  | 2,611  |  |  |      | 2,657  |  |  |  | 2,701  | 
|Equity attributable to equity holders of sanofi-aventis                                                        |  |                                           | 53,097 |     |      |  | 48,322 | (g)  |  |  | 44,866 |  |  |      | 44,542 |  |  |  | 45,600 | 
|Long-term debt                                                                                                 |  |                                           | 6,695  |     |      |  | 5,961  |      |  |  | 4,173  |  |  |      | 3,734  |  |  |  | 4,499  | 
|Cash dividend paid per share ()(d)                                                                            |  |                                           | 2.50   | (e) |      |  | 2.40   |      |  |  | 2.20   |  |  |      | 2.07   |  |  |  | 1.75   | 
|Cash dividend paid per share ($)(d)(f)                                                                         |  |                                           | 3.34   | (e) |      |  | 3.46   |      |  |  | 3.06   |  |  |      | 3.02   |  |  |  | 2.31   | 





|(a) | Refer to definition in Notes D.1. and D.8.1. to our consolidated financial
statements included at Item 18 of this annual report.
|--- | --------------------------------------------------------------------------------------------------------------------------------

|(b) | Based on the weighted average number of shares outstanding in each period used to
compute basic earnings per share, i.e., 1,305.3 million shares in 2010, 1,305.9 million shares in 2009, 1,309.3 million shares in 2008, 1,346.9 million shares in 2007, and 1,346.8 million shares in 2006.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(c) | Based on the weighted average number of shares outstanding in each period plus
stock options and restricted shares with a potentially dilutive effect; i.e., 1,308.2 million shares in 2010, 1,307.4 million shares in 2009, 1,310.9 million shares in 2008, 1,353.9 million shares in 2007, and
1,358.8 million shares in 2006.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(d) | Each American Depositary Share, or ADS, represents one half of one share.
|--- | -------------------------------------------------------------------------

|(e) | Dividends for 2010 will be proposed for approval at the annual general meeting
scheduled for May 6, 2011.
|--- | ---------------------------------------------------------------------------------------------------------

|(f) | Based on the relevant year-end exchange rate.
|--- | ---------------------------------------------

|(g) | In accordance with IFRS 3 (Business Combinations), sanofi-aventis adjusted the
values of certain identifiable assets and liabilities of Merial during the purchase price allocation period (see Note D.1. to our consolidated financial statements included at Item 18 of this annual report).
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



2



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##### Table of Contents

SELECTED EXCHANGE RATE INFORMATION



The following table sets forth, for the periods and dates
indicated, certain information concerning the exchange rates for the euro from 2006 through February 2011 expressed in U.S. dollar per euro. The information concerning the U.S. dollar exchange rate is based on the noon buying rate in New York City
for cable transfers in foreign currencies as certified for customs purposes by the Federal Reserve Bank of New York (the Noon Buying Rate). We provide the exchange rates below solely for your convenience. We do not represent that euros
were, could have been, or could be, converted into U.S. dollars at these rates or at any other rate. For information regarding the effect of currency fluctuations on our results of operations, see Item 5. Operating and Financial Review
and Prospects and Item 11. Quantitative and Qualitative Disclosures about Market Risk.



|              |  |                        |      |  |                 |  |      |      |  |  |      |  |  |  |      | 
|------------- |  | ---------------------- | ---- |  | --------------- |  | ---- | ---- |  |  | ---- |  |  |  | ---- | 
|              |  | Period-end Rate        |      |  | AverageRate
(1) |  |      | High |  |  | Low  | 
|              |  | (U.S. dollar per euro) |     
|2006          |  |                        | 1.32 |  |                 |  | 1.27 |      |  |  | 1.33 |  |  |  | 1.19 | 
|2007          |  |                        | 1.46 |  |                 |  | 1.38 |      |  |  | 1.49 |  |  |  | 1.29 | 
|2008          |  |                        | 1.39 |  |                 |  | 1.47 |      |  |  | 1.60 |  |  |  | 1.24 | 
|2009          |  |                        | 1.43 |  |                 |  | 1.40 |      |  |  | 1.51 |  |  |  | 1.25 | 
|2010          |  |                        | 1.33 |  |                 |  | 1.32 |      |  |  | 1.45 |  |  |  | 1.20 | 
|Last 6 months |  |                        |      |  |                 |  |      |      |  |  |      |  |  |  |      | 
|2010          |  |                        |      |  |                 |  |      |      |  |  |      |  |  |  |      | 
|August        |  |                        | 1.27 |  |                 |  | 1.29 |      |  |  | 1.33 |  |  |  | 1.27 | 
|September     |  |                        | 1.36 |  |                 |  | 1.31 |      |  |  | 1.36 |  |  |  | 1.27 | 
|October       |  |                        | 1.39 |  |                 |  | 1.39 |      |  |  | 1.41 |  |  |  | 1.37 | 
|November      |  |                        | 1.30 |  |                 |  | 1.37 |      |  |  | 1.42 |  |  |  | 1.30 | 
|December      |  |                        | 1.33 |  |                 |  | 1.32 |      |  |  | 1.34 |  |  |  | 1.31 | 
|2011          |  |                        |      |  |                 |  |      |      |  |  |      |  |  |  |      | 
|January       |  |                        | 1.37 |  |                 |  | 1.34 |      |  |  | 1.37 |  |  |  | 1.29 | 
|February(2)   |  |                        | 1.38 |  |                 |  | 1.36 |      |  |  | 1.38 |  |  |  | 1.35 | 





|(1) | The average of the Noon Buying Rates on the last business day of each month
during the relevant period for the full year average, and on each business day of the month for the monthly average. The latest available Noon Buying Rate being February 18, 2011, we have used European Central Bank Rates for the period from February
21, 2011 to February 25, 2011.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | In each case, measured through February 25, 2011.
|--- | -------------------------------------------------



On February 25,
2011 the European Central Bank Rate was 1.3762 per euro.



B. Capitalization and Indebtedness



N/A



C. Reasons for Offer and Use of Proceeds



N/A



3



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D. Risk Factors



Important factors that could cause actual financial,
business, research or operating results to differ materially from expectations are disclosed in this annual report, including without limitation the following risk factors and the factors described under Cautionary Statement Regarding
Forward-Looking Statements. In addition to the risks listed below, we may be subject to other material risks that as of the date of this report are not currently known to us or that we deem immaterial at this time.



Risks Relating to Legal Matters



Generic versions of some of our products may be approved for sale in one
or more of their major markets.



Competitors
may file marketing authorization requests for generic versions of our products. Approval and market entry of a generic product would reduce the price that we receive for these products and/or the volume of the product that we would be able to sell,
and could materially adversely affect our business, results of operations and financial condition. The market for our products could also be affected if a competitors innovative drug in the same market were to become available as a generic.
Additionally, a number of our products acquired through business combinations have substantial balance sheet carrying values, as disclosed at Note D.4. to our consolidated financial statements included in this annual report at Item 18, which could
be substantially impaired by the introduction of a generic competitor, with adverse effects on our financial condition and the value of our assets.



Through patent and other proprietary rights, we hold exclusivity rights for a number of our research-based products. However, the patent
protection that we are able to obtain varies from product to product and country to country and may not be sufficient to maintain product exclusivity. We are involved in litigation worldwide to enforce certain of these patent rights against generics
and proposed generics (see Note D.22.b) to our consolidated financial statements included in this annual report at Item 18 for additional information). Moreover, patent rights are limited in time and do not always provide effective
protection for our products: competitors may successfully avoid patents through design innovation, we may not hold sufficient evidence of infringement to bring suit, or our infringement claim may not result in a decision that our rights are valid,
enforceable or infringed. Moreover, a number of countries are increasingly easing the introduction of generic drugs or biosimilar products through accelerated approval procedures.



Even in cases where we do ultimately prevail in our
infringement claim, legal remedies available for harm caused to us by infringing products may be inadequate to make us whole. A competitor may launch at risk before the initiation or completion of the court proceedings, and the court may
decline to grant us a preliminary injunction to halt further at risk sales and remove the infringing product from the market. Additionally, while we would be entitled to obtain damages in such a case, the amount that we may ultimately be
awarded and able to collect may be insufficient to compensate all harm caused to us.



Finally, our successful assertion of a given patent against one competing product is not necessarily predictive of our future success or failure in asserting the same patent against a second competing
product because of such factors as possible differences in the formulations of the competing products, intervening developments in law or jurisprudence, or inconsistent judgments. Moreover, patents differ from country to country and a successful
result in one country may not predict success in another country because of local variations in the patents and differences in national law or legal systems.



Many Group products are already subject to aggressive generic competition, and additional products of the Group could become subject to
generic competition in the future.



Product liability claims
could adversely affect our business, results of operations and financial condition.



Product liability is a significant business risk for any pharmaceutical company, and the Groups ongoing diversification may increase our product liability exposure (see The diversification of
the Groups business exposes us to additional risks below). Substantial damage awards have been made  notably in the United States and other common law jurisdictions  against pharmaceutical companies based upon claims for
injuries allegedly caused by the use of their products. Sometimes side effects of pharmaceutical drugs cannot be adequately anticipated based on preapproval clinical studies involving only several hundred to several thousand



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patients. Routine review and analysis of the continually growing body of post-marketing safety surveillance and clinical trials provide additional information  for example, potential
evidence of rare, population-specific or long-term adverse reactions or of drug interactions that were not observed in preapproval clinical studies  and may cause product labeling to evolve, including restrictions of therapeutic indications,
new contraindications, warnings or precautions, and occasionally even the suspension or withdrawal of a product marketing authorization. Several pharmaceutical companies have withdrawn products from the market because of actual or suspected adverse
reactions to their products, and currently face significant product liability claims. We are currently defending a number of product liability claims (see Note D.22.a) to the consolidated financial statements included at Item 18 of this annual
report) and there can be no assurance that the Group will be successful in defending against each of these claims or will not face additional claims in the future.



Although we continue to insure a portion of our product
liability with third-party carriers, product liability coverage is increasingly difficult and costly to obtain, particularly in the United States, and in the future it is possible that self-insurance may become the sole commercially reasonable means
available for managing the product liability financial risk of our pharmaceutical and vaccines businesses (see Item 4. Information on the Company  B. Business Overview  Insurance and Risk Coverage.) Due to insurance
conditions, even when the Group has insurance coverage, recoveries from insurers may not be totally successful. Moreover the insolvency of a carrier could negatively affect our ability to achieve the practical recovery of the coverage for which we
have already paid a premium.



Product liability
claims, regardless of their merits or the ultimate success of the Groups defense, are costly, divert management attention, may harm our reputation and can impact the demand for our products. Substantial product liability claims, if successful,
could adversely affect our business, results of operations and financial condition.



Claims and investigations relating to competition law, marketing practices and pricing could adversely affect our business, results of operations and financial condition.



The marketing of our products is heavily regulated, and
alleged failures to comply fully with applicable regulations could subject us to substantial fines, penalties and injunctive or administrative remedies, potentially leading to the imposition of additional regulatory controls or exclusion from
government reimbursement programs. Sanofi-aventis and certain of its subsidiaries are under investigation by various government entities and are defending a number of lawsuits relating to antitrust and/or pricing and marketing practices, including,
for example in the United States, class action lawsuits and whistle blower litigation. See Note D.22.c) to our consolidated financial statements included at Item 18 of this annual report.



Because many of these cases allege substantial unquantified damages, may be subject to treble damages and
frequently seek significant punitive damages and penalties, it is possible that any final determination of liability or settlement of these claims or investigations could have a material adverse effect on our business, results of operations or
financial condition.



There are other legal matters in which
adverse outcomes could have a material adverse effect on our business, results of operations and financial condition.



The Group faces significant litigation and government investigations or audits, including allegations of securities law violations, claims
related to employment matters, patent and intellectual property disputes, consumer law claims and tax audits.



Unfavorable outcomes in these matters, or in similar matters to be faced in the future, could preclude the commercialization of products,
negatively affect the profitability of existing products and subject us to substantial fines, penalties and injunctive or administrative remedies, potentially leading to the imposition of additional regulatory controls or exclusion from government
reimbursement programs. Any such result could materially and adversely affect our results of operations, financial condition, or business. See Item 8. Financial Information  A. Consolidated Financial Statements and Other Financial
Information  Information on Legal or Arbitration Proceedings and Note D.22. to our consolidated financial statements included at Item 18 of this annual report.



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Changes in the laws or regulations that apply to us could affect the Groups business, results of
operations and financial condition.



Governmental authorities are increasingly looking to facilitate generic and biosimilar competition to existing products through new
regulatory proposals intended to, or resulting in, changes to the scope of patent or data exclusivity rights and use of accelerated regulatory pathways for generic and biosimilar drug approvals.



This new competitive environment and potential regulatory
changes may further limit the exclusivity enjoyed by innovative products on the market and directly impact pricing and reimbursement levels, which may adversely affect our business and future results. See Item 4. Information on the Company
 B. Business Overview  Competition and Item 4. Information on the Company  B. Business Overview  Regulation.



In addition, changes in tax laws or in their application with respect to matters such as tax rates, transfer pricing, dividends,
controlled companies or a restriction in certain forms of tax relief, could affect our effective tax rate and our future results.



For information regarding risks related to changes in environmental rules and regulations, see  Environmental Risks of
our Industrial Activities  Environmental liabilities and compliance costs may have a significant adverse effect on our results of operations below.



Risks Relating to Our Business



We may fail to adequately renew our product portfolio whether through our
own research and development or through acquisitions and strategic alliances.



To be successful in the highly competitive pharmaceutical industry, we must commit substantial resources each year to research and development in order to develop new products to take the place of
products facing expiration of patent and regulatory data exclusivity or competition from new products that are perceived as being superior. In 2010, we spent 4,401 million on research and development, amounting to approximately 14.5% of
our net sales.



The research and development
process typically takes from 10 to 15 years from discovery to commercial product launch. This process is conducted in various stages in order to test, along with other features, the effectiveness and safety of a product. There can be no assurance
that any of these compounds will be proven safe or effective. See Item 4. Information on the Company  B. Business Overview  Pharmaceutical Research & Development and Item 4. Information on the Company
 B. Business Overview  Vaccines Research and Development. Accordingly, there is a substantial risk at each stage of development that we will not achieve our goals of safety and/or effectiveness and that we will have to abandon a
product in which we have invested substantial amounts, including in late stage development (Phase III). Moreover, decisions concerning the studies to be carried out can have a significant impact on the marketing strategy for a given product.
Multiple in-depth studies can demonstrate that a product has additional benefits, facilitating the products marketing, but such studies are expensive and time consuming and may delay the products submission to health authorities for
approval. Our ongoing investments in new product launches and research and development for future products could therefore result in increased costs without a proportionate increase in revenues which may negatively affect our operating results. Each
regulatory authority may also impose its own requirements in order to grant a license to market the product, including requiring local clinical studies, and may delay or refuse to grant approval, even though a product has already been approved in
another country. Finally, obtaining regulatory marketing approval is not a guarantee that the product will achieve commercial success. Following each product marketing approval, the medical need served by the product and the corresponding
reimbursement rate are evaluated by other governmental agencies which may in some cases require additional studies, including comparative studies, which may both effectively delay marketing of the new product and add to its development costs.



As a complement to our portfolio of products, we
pursue a strategy of acquisitions, in-licensing and partnerships in order to develop new growth opportunities. The implementation of this strategy depends on our ability to identify business development opportunities at a reasonable cost and under
acceptable conditions of financing. Moreover, entering into these in-licensing or partnership agreements generally requires the payment of significant milestones well before the relevant products are placed on the market without any
assurance that such investments will ultimately become profitable in the long term. Because of the active competition among pharmaceutical groups for such business development opportunities, there can be no assurance of our success in completing
these transactions when such opportunities are identified.



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A substantial share of the revenue and income of sanofi-aventis depends on the performance of certain
flagship products.



We
generate a substantial share of our revenues from the sale of certain key products (see Item 5. Operating and Financial Review and Prospects  Results of Operations  year ended December 31, 2010 compared with year ended December 31,
2009  Net Sales by Product  Pharmaceuticals), which represented 43.8% of the Groups consolidated revenues in 2010. Among these products is Lantus®, which was the Groups leading product with revenues of 3,510 million in 2010, representing 11.6% of the Groups consolidated revenues for the
year. Lantus® is a flagship product of the Diabetes division, one of the Groups growth platforms. A
reduction in sales or in the growth of sales of one or more of our flagship products (in particular sales of
Lantus®) could affect our business, results of operations and financial condition.



We may lose market share to competing low-cost remedies or generic brands
if they are perceived to be superior products.



We are faced with intense competition from generic products and brand-name drugs. Doctors or patients may choose these products over ours
if they perceive them to be safer, more reliable, more effective, easier to administer or less expensive, which could cause our revenues to decline and affect our results of operations.



The diversification of the Groups business exposes us to additional risks.



We have undertaken to transform our Group by implementing a
strategy that includes pursuing external growth opportunities to meet the challenges that we have identified for the future. The inability to quickly or efficiently integrate newly acquired activities or businesses, or integration costs that are
higher than anticipated, could delay our growth objectives and prevent us from achieving expected synergies. Moreover, we may miscalculate the risks associated with these entities at the time they are acquired or not have the means to evaluate them
properly. It may take a considerable amount of time and be difficult to implement a risk analysis after the acquisition is completed due to lack of historical data. As a result, risk management and the coverage of such risks, particularly through
insurance policies, may prove to be insufficient or ill-adapted.



In addition to pursuing our objective to become a global and diversified leader within the health industry, we are exposed to a number of new risks inherent in sectors in which, in the past, we have been
either less active or entirely inactive. As an example:



| |  |  | we have increased exposure to the animal health business. The contribution of our animal health business to the Groups income may be adversely
affected by a number of risks including some which are specific to this business: i.e., the outbreak of an epidemic or pandemic that could kill large numbers of animals, and the effect of reduced veterinary expenditures during an economic
crisis.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the margins of consumer health and generic products are generally lower than those of the traditional branded prescription pharmaceutical business.
Moreover, the periodic review of the effectiveness, safety and use of certain over-the-counter drug products by health authorities or lawmakers may result in modifications to the regulations that apply to certain components of such products, which
may require them be withdrawn from the market and/or that their formulation be modified.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | specialty products (such as those developed by Genzyme) that treat rare, life-threatening diseases that are used by a small number of patients are
often expensive to develop compared to the market opportunity, but third-party payers trying to limit health-care expenses may become less willing to support their per-unit cost.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Moreover, the nature, scope and level of losses that may be
sustained or caused by these new businesses may differ from the types of product liability claims that we have handled in the past (See  Product liability claims could adversely affect our business, results of operations and financial
condition above), and thus our current risk management and insurance coverage may not be adapted to such losses. These risks could affect our business, results of operations or financial condition.



Successful completion of the Genzyme acquisition could temporarily lessen
our strategic flexibility.



While the
proposed acquisition of Genzyme would provide the Group with attractive new opportunities, the diversification into new business lines and the management of substantial additional research, manufacturing and commercial operations may occupy
significant organizational attention. Moreover, to acquire Genzyme, the



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Group will be required to incur a substantial amount of debt. As a result, we would be required to make significant payments to lenders. Our post-acquisition level of indebtedness could also
cause our credit rating to be downgraded, increase our financing costs, limit our capacity to secure additional financing and limit our ability to engage in additional transactions.



The globalization of the Groups business exposes us to increased risks.



The significant expansion of our activities in emerging
markets may further expose us to more volatile economic conditions, political instability, competition from companies that are already well established in these markets, the inability to adequately respond to the unique characteristics of these
markets, particularly with respect to their regulatory frameworks, difficulties in recruiting qualified personnel, potential exchange controls, weaker intellectual property protection, higher crime levels (particularly with respect to counterfeit
products (see  Counterfeit versions of our products could harm our business below)), corruption and fraud. Any difficulties in adapting to these markets and/or a significant decline in the anticipated growth rate in these regions
could impair our ability to take advantage of these growth opportunities and could affect our business, results of operations or financial condition.



The regulatory environment is increasingly challenging for the pharmaceutical industry.



The industry in which we operate faces a changing regulatory environment and heightened public scrutiny
worldwide, which simultaneously require greater assurances than ever as to the safety and efficacy of medications and health products on the one hand, and effectively provide reduced incentives for innovative pharmaceutical research on the other
hand.



Health authorities, in particular the U.S.
Food and Drug Administration (FDA) and the European Medicines Agency (EMA) have imposed increasingly burdensome requirements on pharmaceutical companies, particularly in terms of the volume of data needed to demonstrate a products efficacy and
safety. Marketed products are also subject to continual review even after regulatory approval. Later discovery of previously undetected problems may result in marketing restrictions or the suspension or withdrawal of the product, as well as an
increased risk of litigation for both pharmaceutical and animal health products. These post-regulatory approval routine reviews and data analyses can lead to the issuance of recommendations by government agencies, health professional and patient
organizations or other specialized organizations regarding the use of products, which may result in a reduction in sales, such as, for example, a recommendation to limit the patient scope of a drugs indication. In addition, such reviews may
result in the discovery of significant problems with respect to a competing product that is similar to one sold by the Group, which may in turn cast suspicion on the entire class to which these products belong and ultimately diminish the sales of
the relevant product of the Group. When such issues arise, the contemplative nature of evidence-based health care and restrictions on what pharmaceutical manufacturers may say about their products are not always well suited to rapidly defending the
Group or the publics legitimate interests in the face of the political and market pressures generated by social media and rapid news cycles, and this may result in unnecessary commercial harm, overly restrictive regulatory actions and erratic
share price performance.



In addition, to the
extent that new regulations raise the costs of obtaining and maintaining product authorization, or limit the economic value of a new product to its inventor, the growth prospects of our industry and of our Company are diminished.



We face uncertainties over the pricing and reimbursement of pharmaceutical
products.



The commercial success of our
products depends in part on the conditions under which our products are reimbursed. Pressure on pricing and reimbursement is strong due to:



| |  |  | price controls imposed by governments in many countries;
| | - |  | --------------------------------------------------------



| |  |  | removal of a number of drugs from government reimbursement schemes;
| | - |  | -------------------------------------------------------------------



| |  |  | increased difficulty in obtaining and maintaining satisfactory drug reimbursement rates; and
| | - |  | --------------------------------------------------------------------------------------------



| |  |  | the tendency of governments and private health care providers to favor generic pharmaceuticals.
| | - |  | -----------------------------------------------------------------------------------------------



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In addition to the pricing pressures they exert, state and private third-party payers and
purchasers of pharmaceutical products may reduce volumes of sales by restricting access to formularies or otherwise discouraging physician prescriptions of our products. In the United States, the new health care reform law increased the
governments role with respect to price, reimbursement and the coverage levels for healthcare-related expenses for the large government health care sector. Implementation of the new law could affect our revenues and/or margins (for further
details concerning this law and a description of certain regulatory pricing systems that affect our Group see Item 4. Information on the Company  B. Business Overview  Pricing & Reimbursement).



Our operating results may also be affected by parallel
imports, particularly within the European Union, whereby distributors engage in arbitrage based on national price differences to buy product on low cost markets for resale on higher cost markets.



A slowdown of global economic growth could have
negative consequences for our business(1).



Over the past several years, growth of the global
pharmaceutical market has become increasingly tied to global economic growth. In this context, a substantial and lasting slowdown of the global economy or major national economies could negatively affect growth in the global pharmaceutical market
and, as a result, adversely affect our business. This effect may be expected to be particularly strong in markets having significant co-pays or lacking a developed third-party payer system, as individual patients may delay or decrease out-of-pocket
healthcare expenditures. Such a slowdown could also reduce the sources of funding for national social security systems, leading to heightened pressure on drug prices, increased substitution of generic drugs, and the exclusion of certain products
from formularies.



Additionally, to the extent the
slowing economic environment may lead to financial difficulties or even the default or failure of major players including wholesalers or public sector buyers financed by insolvent States, the Group could experience disruptions in the distribution of
its products as well as the adverse effects described below at   We are subject to the risk of non-payment by our customers.



We rely on third parties for the marketing of some of our products.



We market some of our products in
collaboration with other pharmaceutical companies. For example, we currently have major collaborative arrangements with Bristol-Myers Squibb (BMS) for the marketing of Plavix® and Aprovel® in the United
States and several other countries, with Warner Chilcott for the osteoporosis treatment Actonel®, with Teva for
Copaxone®, and with Merck & Co., Inc. for the distribution of vaccines in Europe. See Item 4.
Information on the Company  B. Business Overview Pharmaceutical Products  Main pharmaceutical products for more information on our major alliances. When we market our products through collaboration arrangements, we are
subject to the risk that certain decisions, such as the establishment of budgets and promotion strategies, are subject to the control of our collaboration partners, and that deadlocks may adversely affect the activities conducted through the
collaboration arrangements. For example, our alliances with BMS are subject to the operational management of BMS in some countries, including the United States. Any conflicts that we may have with our partners may affect the marketing of certain of
our products. Such difficulties may cause a decline in our revenues and affect our results of operations.



The manufacture of our products is technically complex, and supply interruptions, product recalls or inventory losses caused by unforeseen events may reduce sales, delay the launch of new products and
adversely affect our operating results and financial condition.



Many of our products are manufactured using technically complex processes requiring specialized facilities, highly specific raw materials and other production constraints. Our vaccine products in
particular are subject to the risk of manufacturing stoppages or the risk of loss of inventory because of the difficulties inherent to the sterile processing of biological materials and the potential unavailability of adequate amounts of raw
materials meeting our standards. Additionally, specific conditions must be respected both by the Group and our customers for the storage and distribution of many of our products, e.g., cold storage for certain vaccines and insulin-based



|(1) | Information in this section is complementary to Note B.8.8. to our consolidated financial statements included at Item 18 of this annual report, with respect to
information required by IFRS 7, and is covered by our independent registered public accounting firms report on the consolidated financial statements.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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products. The complexity of these processes, as well as strict internal and government standards for the manufacture of our products, subject us to risks. The occurrence or suspected occurrence
of out-of-specification production or storage can lead to lost inventories, and in some cases product recalls, with consequential reputational damage and the risk of product liability (See  Risks Relating to Legal Matters  Product
liability claims could adversely affect our business, results of operations and financial condition above). The investigation and remediation of any identified problems can cause production delays, substantial expense, lost sales and the delay
of new product launches and can adversely affect our operating results and financial condition.



We rely on third parties for the manufacture and supply of a substantial portion of our raw materials, active ingredients and medical devices.



Third parties supply us with a
substantial portion of our raw materials, active ingredients and medical devices, which exposes us to the risk of a supply interruption in the event that these suppliers experience financial difficulties or are unable to manufacture a sufficient
supply of our products meeting Group quality standards. It also increases the risk of quality issues, even with the most scrupulously selected suppliers. For example, in 2008 we recalled a limited number of batches of Lovenox® and wrote down significant unused inventory following the discovery of quality issues at a Chinese supplier of raw
materials. If disruptions or quality concerns were to arise in the third-party supply of raw materials, active ingredients or medical devices, this could adversely affect our ability to sell our products in the quantities demanded by the market and
could damage our reputation and relationships with our customers. See also  The manufacture of our products is technically complex, and supply interruptions, product recalls or inventory losses caused by unforeseen events may reduce
sales, delay the launch of new products and adversely affect our operating results and financial condition above. Even though we aim to have backup sources of supply whenever possible, including by manufacturing backup supplies of our
principal active ingredients at a second or third facility when practicable, we cannot be certain they will be sufficient if our principal sources become unavailable. Switching sources and manufacturing facilities may require significant time.



Some raw materials essential
to the manufacture of our products are not widely available from sources we consider reliable; for example, we have approved only a limited number of suppliers of heparins for use in the manufacture of Lovenox®. Heparin purchase prices can also fluctuate. See Item 4. Information on the Company  B. Business
Overview  Production and Raw Materials for a description of these outsourcing arrangements. Any of these factors could adversely affect our business, operating results or financial condition.



Counterfeit versions of our products could harm our business.



The drug supply has been increasingly
challenged by the vulnerability of distribution channels to illegal counterfeiting and the presence of counterfeit products in a growing number of markets and over the Internet. Counterfeit products are frequently unsafe or ineffective, and can be
potentially life-threatening. To distributors and users, counterfeit products may be visually indistinguishable from the authentic version. Reports of adverse reactions to counterfeit drugs or increased levels of counterfeiting could materially
affect patient confidence in the authentic product, and could harm the business of companies such as sanofi-aventis. Additionally, it is possible that adverse events caused by unsafe counterfeit products will mistakenly be attributed to the
authentic product. If a Group product were the subject of counterfeits, the Group could incur substantial reputational and financial harm. See Item 4. Information on the Company  B. Business Overview  Competition.



Use of biologically derived ingredients may face resistance from patients
or the purchasers of these products, which could adversely affect sales and cause us to incur substantial costs.



In line with industry practice, we manufacture our vaccines and many of our prescription pharmaceutical products with ingredients derived
from animal or plant tissue. We subject our products incorporating these ingredients to extensive tests and believe them to be safe. There have been instances in the past where the use of biologically derived ingredients by the Group or its
competitors has been alleged to be an actual or theoretical source of harm, including infection or allergic reaction, or instances where production facilities have been subject to prolonged periods of closure because of possible contamination. Such
allegations have on occasion led to damage claims and increased resistance on the part of patients to such ingredients. A substantial claim of harm caused by a product incorporating biologically derived ingredients or a contamination event could
lead us to



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incur potentially substantial costs as a result of, among other things, litigation of claims, product recalls, adoption of additional safety measures, manufacturing delays, investment in patient
education, and development of synthetic substitutes for ingredients of biological origin. Such claims could also generate patient resistance, with a corresponding adverse effect on sales and results of operations.



We are subject to the risk of non-payment by our
customers.(1)



We run the risk of non-payment by our customers, which
consist principally of wholesalers, distributors, pharmacies, hospitals, clinics and government agencies. This risk is accentuated by the current worldwide financial crisis. The United States, which is our largest market in terms of sales, poses
particular client credit risk issues, because of the concentrated distribution system in which approximately 73% of our consolidated U.S. pharmaceutical sales are accounted for by just three wholesalers. In addition, the Groups three main
customers represent 20.6% of our total revenues. We are also exposed to large wholesalers in other markets, particularly in Europe. An inability of one or more of these wholesalers to honor their debts to us could adversely affect our financial
condition (see Note D.34. to our consolidated financial statements included at Item 18 of this annual report).



Our pension liabilities are affected by factors such as the performance of plan assets, interest rates, actuarial data and experience and changes in laws and regulations.



Our future funding obligations for our main defined-benefit
pension plans depend on changes in the future performance of assets held in trust for these plans, the interest rates used to determine funding levels (or company liabilities), actuarial data and experience, inflation trends, the level of benefits
provided for by the plans, as well as changes in laws and regulations. Adverse changes in those factors could increase our unfunded obligations under such plans, which would require more funds to be contributed and hence negatively affect our cash
flow and results (see Note D.19.1 to our consolidated financial statements included at Item 18 of this annual report).



We are increasingly dependent on our technological infrastructure and computer networks.



Our business depends on the use of computerized data, which means that certain key divisions such as research
and development, production and sales are to a large extent dependent on our information technology network. Our inability to implement adequate security and memory storage systems for saved data could lead to their deterioration or loss in the
event of a system malfunction, or allow data to be stolen or corrupted in the event of a security breach, which could have a material adverse effect on our business, operating results and financial condition.



Environmental Risks of Our Industrial Activities



Risks from the handling of hazardous materials could adversely affect our
results of operations.



Manufacturing
activities, such as the chemical manufacturing of the active ingredients in our products and the related storage and transportation of raw materials, products and wastes, expose us to various risks, including:



| |  |  | fires and/or explosions;
| | - |  | ------------------------



| |  |  | storage tank leaks and ruptures; and
| | - |  | ------------------------------------



| |  |  | discharges or releases of toxic or hazardous substances.
| | - |  | --------------------------------------------------------



These operating risks can cause personal injury, property
damage and environmental contamination, and may result in:



| |  |  | the shutdown of affected facilities; and
| | - |  | ----------------------------------------



| |  |  | the imposition of civil or criminal penalties.
| | - |  | ----------------------------------------------



The occurrence of any of these events may significantly
reduce the productivity and profitability of a particular manufacturing facility and adversely affect our operating results.



|(1) | Information in this section is complementary to Note B.8.8. to our consolidated financial statements included at Item 18 of this annual report, with respect to
information required by IFRS 7, and is covered by our independent registered public accounting firms report on the consolidated financial statements and by Notes D.10. and D.34. to our consolidated financial statements included at Item 18
of this annual report.
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Although we maintain property, business interruption and casualty insurance that we believe
is in accordance with customary industry practices, we cannot assure you that this insurance will be adequate to cover fully all potential hazards incidental to our business.



Environmental liabilities and compliance costs may have a significant
adverse effect on our results of operations.



The environmental laws of various jurisdictions impose actual and potential obligations on our Group to remediate contaminated sites.
These obligations may relate to sites:



| |  |  | that we currently own or operate;
| | - |  | ---------------------------------



| |  |  | that we formerly owned or operated; or
| | - |  | --------------------------------------



| |  |  | where waste from our operations was disposed.
| | - |  | ---------------------------------------------



These environmental remediation obligations could
significantly reduce our operating results. Sanofi-aventis accrues provisions for remediation when our management believes the need is probable and that it is reasonably possible to estimate the cost. See Item 4. Information on the
Company  B. Business Overview  Health, Safety and Environment (HSE) for additional information regarding our environmental policies. In particular, our provisions for these obligations may be insufficient if the
assumptions underlying these provisions prove incorrect or if we are held responsible for additional, currently undiscovered contamination. These judgments and estimates may later prove inaccurate, and any shortfalls could have a material adverse
effect on our results of operations and financial condition.



Furthermore, we are or may become involved in claims, lawsuits and administrative proceedings relating to environmental matters. Some current and former sanofi-aventis subsidiaries have been named as
potentially responsible parties or the equivalent under the U.S. Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended (also known as Superfund), and similar statutes in France, Germany,
Italy, Brazil and elsewhere. As a matter of statutory or contractual obligation, we and/or our subsidiaries may retain responsibility for environmental liabilities at some of the sites of our predecessor companies, or our subsidiaries that we
demerged, divested or may divest. We have disputes outstanding, for example, with Rhodia, over costs related to environmental liabilities regarding certain sites no longer owned by the Group. An adverse outcome in such disputes might have a
significant adverse effect on our operating results. See Note D.22.e) to the consolidated financial statements included at Item 18 of this annual report.



Environmental regulations are evolving (i.e., in
Europe, REACH, SEVESO, IPPC, the Waste Framework Directive, the Emission Trading Scheme Directive, the Water Framework Directive and the Directive on Taxation of Energy Products and Electricity and several other regulations aiming at preventing
global warming). Stricter environmental, safety and health laws and enforcement policies could result in substantial costs and liabilities to our Group and could subject our handling, manufacture, use, reuse or disposal of substances or pollutants,
site restoration and compliance costs to more rigorous scrutiny than is currently the case. Consequently, compliance with these laws could result in significant capital expenditures as well as other costs and liabilities, thereby adversely affecting
our business, results of operations or financial condition. For more detailed information on environmental issues, see Item 4. Information on the Company  B. Business Overview  Health, Safety and Environment (HSE).



Risks
Related to Financial Markets(1)



Fluctuations in currency exchange rates could adversely affect our results of operations and financial condition.



Because we sell our products in numerous countries, our
results of operations and financial condition could be adversely affected by fluctuations in currency exchange rates. We are particularly sensitive to movements in exchange rates between the euro and the U.S. dollar, the British pound, the Japanese
yen, and to currencies in emerging countries. In 2010, approximately 30% of our net sales were realized in the United States. While we incur expenses in those currencies, the impact of currency exchange rates on these expenses does not fully offset



|(1) | Information in this section is complementary to Note B.8.8. to our consolidated financial statements included at Item 18 of this annual report,
with respect to information required by IFRS 7, and is covered by our independent registered public accounting firms report on the consolidated financial statements.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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the impact of currency exchange rates on our revenues. As a result, currency exchange rate movements can have a considerable impact on our earnings. When deemed appropriate and when technically
feasible, we enter into transactions to hedge our exposure to foreign exchange risks. These efforts, when undertaken, may fail to offset the effect of adverse currency exchange rate fluctuations on our results of operations or financial condition.
For more information concerning our exchange rate exposure, see Item 11. Quantitative and Qualitative Disclosures about Market Risk.



In the context of the worldwide financial crisis, our liquidity may be constrained.



As of December 31, 2010, the Groups net debt amounted to 1.6 billion, an amount which will
increase substantially upon acquisition of Genzyme. In addition to debt outstanding, the Group has contracted a number of credit lines and put into place commercial paper and medium term note programs with the aim of providing liquidity. See
Item 11. Quantitative and Qualitative Disclosures about Market Risk. In the event of a market-wide liquidity crisis, the Group might be faced with reduced access to sources of financing, including under programs currently in place, or
less favorable conditions.



Risks Relating to an Investment in
our Shares or ADSs



Foreign exchange fluctuations may
adversely affect the U.S. dollar value of our ADSs and dividends (if any).



Holders of ADSs face exchange rate risk. Our ADSs trade in U.S. dollars and our shares trade in euros. The value of the ADSs and our shares could fluctuate as the exchange rates between these currencies
fluctuate. If and when we do pay dividends, they would be denominated in euros. Fluctuations in the exchange rate between the euro and the U.S. dollar will affect the U.S. dollar amounts received by owners of ADSs upon conversion by the depositary
of cash dividends, if any. Moreover, these fluctuations may affect the U.S. dollar price of the ADSs on the New York Stock Exchange (NYSE), whether or not we pay dividends in addition to the amounts, if any, that a holder would receive upon our
liquidation or upon the sale of assets, merger, tender offer or similar transactions denominated in euros or any foreign currency other than U.S. dollars.



Persons holding ADSs rather than shares may have difficulty exercising certain rights as a shareholder.



Holders of ADSs may have more difficulty exercising their
rights as a shareholder than if they directly held shares. For example, if we offer new shares and they have the right to subscribe for a portion of them, the depositary is allowed, at its own discretion, to sell for their benefit that right to
subscribe for new shares instead of making it available to them. Also, to exercise their voting rights, as holders of ADSs, they must instruct the depositary how to vote their shares. Because of this extra procedural step involving the depositary,
the process for exercising voting rights will take longer for holders of ADSs than for holders of shares. ADSs for which the depositary does not receive timely voting instructions will not be voted at any meeting.



Our two largest shareholders own a significant percentage of the share
capital and voting rights of sanofi-aventis.



As of December 31, 2010, LOréal and Total, our two largest shareholders, held approximately 9.02% and 5.51% of our
issued share capital, respectively, accounting for approximately 15.61% and approximately 9.19%, respectively, of the voting rights (excluding treasury shares) of sanofi-aventis. See Item 7. Major Shareholders and Related Party Transactions
 A. Major Shareholders. Affiliates of each of these shareholders are currently serving on our Board of Directors. To the extent these shareholders continue to hold a large percentage of our share capital and voting rights,
LOréal and Total will remain in a position to exert heightened influence in the election of the directors and officers of sanofi-aventis and in other corporate actions that require shareholders approval.



Sales of our shares may cause the market price of our shares or ADSs to
decline.



Neither LOréal nor
Total is, to our knowledge, subject to any contractual restrictions on the sale of the shares each holds in our Company. Both of these shareholders have announced their intent to sell all or part of their stakes in our company, and have recently
liquidated a significant part of their respective holdings. Sales of large numbers of our shares, or a perception that such sales may occur, could adversely affect the market price for our shares and ADSs.



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Item 4. Information on the Company



Introduction



We are a global pharmaceutical group engaged in the
research, development, manufacture and marketing of healthcare products. In 2010, our net sales amounted to 30,384 million. We are the fifth largest pharmaceutical group in the world and the third largest pharmaceutical group in Europe
(source: IMS sales 2010). Sanofi-aventis is the parent of a consolidated group of companies. A list of the principal subsidiaries included in this consolidation is shown at Note F. to our consolidated financial statements included at Item 18 of
this annual report.



Our business includes two
main activities: Pharmaceuticals, and Human Vaccines through sanofi pasteur. The Group is also present in animal health products through Merial Limited (Merial).



In our Pharmaceuticals activity, which generated net sales of
26,576 million in 2010, our major product categories are:



| |  |  | Diabetes: our products include Lantus®, a long acting analog of human insulin which is the leading brand in the insulin market; Apidra®, a rapid-acting analog of human insulin;
Insuman®, a range of human insulin solutions and suspensions, and Amaryl®, an oral once-daily sulfonylurea.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Oncology: our leading products in the oncology market are Taxotere®, a taxane derivative representing a cornerstone therapy in several cancer types; Eloxatine®, a platinum agent, which is a key treatment for colorectal cancer; and Jevtana®, a new taxane derivative launched in the United States in 2010, indicated for patients with prostate cancer.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Other flagship products: our thrombosis medicines include two leading drugs in their categories: Plavix®, an anti-platelet agent indicated for a number of atherothrombotic conditions; and Lovenox®, a low molecular weight heparin indicated for prevention and treatment of deep vein thrombosis and for unstable
angina and myocardial infarction. Our cardiovascular medicines include Multaq®, a new anti-arrhythmic agent
launched in 2009 and indicated for patients with atrial fibrillation; and Aprovel®/ CoAprovel®, a major hypertension treatment.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The global pharmaceutical portfolio of sanofi-aventis also comprises a wide range of other products in Consumer
Health Care (CHC) and other prescription drugs including generics.



We are a world leader in the vaccines industry. Our net sales amounted to 3,808 million in 2010, with leading vaccines in five areas: pediatric combination vaccines, influenza vaccines, adult
and adolescent booster vaccines, meningitis vaccines, and travel and endemics vaccines.



Our animal health activity is carried out through Merial, one of the worlds leading animal healthcare companies,
dedicated to the research, development, manufacture and delivery of innovative pharmaceuticals and vaccines used by veterinarians, farmers and pet owners. Its net sales for 2010 (which are not included in the Groups 2010 net sales) amounted to
1,983 million. The companys top-selling products include Frontline®, a topical anti-parasitic flea
and tick brand for dogs and cats; Heartgard®, a parasiticide for control of heartworm in companion animals; and
Ivomec®, a parasiticide for the control of internal and external parasites in livestock.



In the description below, the following should be kept in
mind:



| |  |  | A drug can be referred to either by its international non-proprietary name (INN) or by its brand name, which is normally exclusive to the company that
markets it. In most cases, our brand names, which may vary from country to country, are protected by trademark registrations. In general, we have chosen in this annual report to refer to our products by the brand names we use in France, except for
Allegra® (sold in France as Telfast®), Tritace® (sold in France as
Triatec®), Amaryl® (sold in France as Amarel®),
Ambien® CR (an extended-release formulation of zolpidem tartrate, not sold in France), and Jevtana® (not currently sold in France).
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | For our pharmaceutical activity, except where otherwise stated, all market share percentages and rankings are based on full-year 2010 sales figures
from IMS Health MIDAS (retail and hospital).
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| |  |  | For our vaccines activity, market shares and rankings are based on our own estimates. These estimates have been made from public domain information
collated from various sources, including statistical data collected by industry associations and information published by competitors.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | We present our consolidated net sales for our leading products sold directly and through alliances. As regards the products sold through our alliance
with Bristol-Myers Squibb (BMS), we also present the aggregate worldwide sales of Plavix® and Aprovel®, whether consolidated by sanofi-aventis or by BMS. A definition of worldwide sales can be found in Item 5.
Operating and Financial Review and Prospects  Results of Operations.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



A. History and Development of the Company



Sanofi-aventis was incorporated under the laws of France in 1994 as a société anonyme, a form of limited liability
company, for a term of 99 years. We operate under the commercial name sanofi-aventis. Our registered office is located at 174, avenue de France, 75013 Paris, France, and our main telephone number is +33 1 53 77 40 00. Our
principal U.S. subsidiarys office is located at 55 Corporate Drive, Bridgewater, NJ 08807; telephone: +1 (908) 981-5000.



We are present in approximately 100 countries on five continents with about 100,000 employees at year end 2010, not including an
additional 5,600 employees of Merial. Our legacy companies, Sanofi-Synthélabo (formed by the 1999 merger of Sanofi and Synthélabo into the current holding company) and Aventis (formed by the combination of Rhône-Poulenc and
Hoechst also in 1999), bring to the Group more than a century of experience in the pharmaceutical industry.



Sanofi was founded in 1973 by Elf Aquitaine, a French oil company, when it took control of the Labaz group, a pharmaceutical company. Its
first significant venture into the U.S. market was the acquisition of the prescription pharmaceuticals business of Sterling Winthrop  an affiliate of Eastman Kodak  in 1994.



Synthélabo was founded in 1970 through the merger of two French pharmaceutical laboratories,
Laboratoires Dausse (founded in 1834) and Laboratoires Robert & Carrière (founded in 1899). In 1973, the French cosmetics group LOréal acquired the majority of its share capital.



Hoechst traces its origins to the second half of the 19th
century, to the time of the German industrial revolution and the emergence of the chemical industry. Traditionally active in pharmaceuticals, Hoechst strengthened its position in that industry by taking a controlling interest in Roussel-Uclaf in
1974 and the U.S. pharmaceutical company Marion Merrell in 1995.



Rhône-Poulenc was formed in 1928 from the merger of two French companies: a chemical company created by the Poulenc brothers and the Société Chimique des Usines du Rhône, which
was founded in 1895. The companys activities in the first half of the 20th century focused on producing chemicals, textiles and pharmaceuticals. Rhône-Poulenc began to focus its activities on life sciences in the 1990s, which led to the
successive purchases of Rorer, a U.S. pharmaceutical company acquired in two stages in 1990 and 1997, Pasteur Mérieux Connaught in the area of vaccines in 1994, and the U.K.-based pharmaceuticals company Fisons in 1995.



Sanofi-Synthélabo took control of Aventis in
August 2004 and changed its registered name to sanofi-aventis. On December 31, 2004, Aventis merged with and into sanofi-aventis, with sanofi-aventis as the surviving company.



In 1994, the Groups vaccines division together with the
vaccines division of Merck & Co., Inc. formed Sanofi Pasteur MSD, creating the only European firm entirely dedicated to vaccines.



Merial was founded in 1997 as a combination of the animal health activities of Rhône-Poulenc and Merck. Merial was a joint venture
in which we and Merck each held 50%. On September 17, 2009, we acquired Mercks entire interest in Merial and secured an option for combining Merial with Mercks Intervet/Schering Plough Animal Health business. On March 8,
2010, sanofi-aventis exercised its contractual right to combine the Intervet/Schering-Plough Animal Health business with Merial to form an animal health joint venture equally owned by Merck and sanofi-aventis. In addition to execution of final
agreements, formation of the new animal health joint venture remains subject to approval by the relevant competition authorities and other closing conditions.



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The parties currently envisage a closing for the transaction in the third quarter of 2011. In accordance with IFRS 5, sanofi-aventis recognises 100% of the Merial income on a separate line
of the income statement Net income from the held-for-exchange Merial business (Merial sales are not consolidated). For more information see Notes B.7., D.1. and D.8.1. to our consolidated financial statements included at Item 18 of
this annual report.



The Prague-based branded
generics group Zentiva was acquired by sanofi-aventis through a tender offer completed on March 11, 2009 followed by a squeeze out of all remaining minority shareholders.



On February 9, 2010, Sanofi-aventis successfully
completed its tender offer for all outstanding shares of common stock of Chattem, Inc., a leading U.S. consumer healthcare company. Immediately following the tender offer, sanofi-aventis held approximately 97% of Chattems outstanding shares,
and acquired the remaining shares in a short form merger on March 10, 2010.



On February 24, 2011, we acquired BMP Sunstone Corporation (a specialty pharmaceutical company with a proprietary portfolio of branded pharmaceutical and healthcare products in China) through a
merger between BMP Sunstone and a wholly-owned subsidiary of ours.



On October 4, 2010, we launched an unsolicited tender offer to acquire Genzyme Corp. of Massachusetts, a leading biotechnology group specialized in the treatment of rare diseases. On February 16, 2011,
the two companies announced an agreement on the terms of an improved offer to acquire Genzyme. The agreement is described at Item 10. Additional Information  C. Material Contracts and any acquisition remains subject to fulfillment
of a number of conditions including acceptance by holders of a majority of shares on a diluted basis.



B. Business Overview



Strategy



Sanofi-aventis is a diversified global healthcare leader with a number of core strengths: a strong and long-established presence in Emerging
Markets(1), a portfolio of diabetes drugs including the
biggest selling insulin in the world (Lantus®), a market-leading position in Vaccines and Animal Health, a broad
range of Consumer Health Care products and research that is increasingly focused on biological products, allied with a track record of adapting cost structures and a solid financial position.



Like most pharmaceutical companies, we are facing competition from generics for several of our major products,
in an environment subject to cost containment pressures from both third party payers and healthcare authorities and to tougher regulatory hurdles. We have decided to respond to these major challenges by developing our growth platforms.



Throughout 2010, we have implemented a wide-ranging
transformation program launched in 2009, designed to secure sources of sustainable growth. Our strategy focuses on three key themes:



| |  |  | Increasing innovation in Research & Development (R&D)
| | - |  | -----------------------------------------------------



We conducted a complete and objective review of our research portfolio in 2009, in order to reassess the
allocation of resources. This review led to a rationalization of our portfolio, targeting the most promising projects. In February 2011, 53% of our development portfolio consisted of biological products and vaccines. We also redefined our
decision-making processes so that new commercial potential and the scope for value creation are better integrated into our development choices. R&D is now based on an organizational structure that focuses on patient needs and encourages
entrepreneurship and autonomy. This network-based organization, open to external opportunities, will enable our R&D to be more creative and make the most of innovation, wherever it comes from.



In line with this policy, we signed new alliance and
licensing agreements in 2010 designed to give us access to new technologies, or to broaden or strengthen our existing fields of research (including diabetes, oncology and



|(1) | We define Emerging Markets as the world excluding the United States, Canada, Western Europe (France, Germany, UK, Italy, Spain, Greece, Cyprus, Malta,
Belgium, Luxemburg, Portugal, the Netherlands, Austria, Switzerland, Ireland, Finland, Norway, Iceland, Sweden and Denmark), Japan, Australia and New Zealand.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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vaccines). In February 2011, 64% of our development portfolio consisted of projects originated by external R&D. Finally, we have made progress on our objective of offering more products that
add value for patients: the launches of the anti-arrhythmic drug Multaq® throughout the world, the anti-cancer
agent Jevtana® in the United States and the influenza vaccines Intanza® and Fluzone® High-Dose are some examples.



| |  |  | Adapting our structures to meet the challenges of the future
| | - |  | ------------------------------------------------------------



During 2009, we adapted our operating model, previously too focused on the best-selling prescription drugs in
our traditional markets, to reflect the diversity of our activities and our geographical reach. In particular, we tailored our strategy, structure and offering to each regions needs, so as to deliver the most appropriate solution to each
patient. 30% of our 2010 sales were in emerging markets, where approximately 39% of our employees are located, and where we have strengthened our Consumer Health Care operations. We also realigned our industrial capacity to reflect our expectation
of changes in volumes and our analysis of the opportunities for growth. Streamlining our structures and our operating model has also enabled us to further improve our operating ratios. In 2010, our cost control program allowed us to reduce the
weight of our research and development expenses and our selling and general expenses compared to our net sales.



| |  |  | Exploring external growth opportunities
| | - |  | ---------------------------------------



Business development is wholly integrated into our overall
strategy, and translates into disciplined acquisitions and alliances that create or strengthen platforms for long-term growth and create value for our shareholders. During 2010, we pursued this active and targeted policy, announcing 37 new
transactions, including nine acquisitions or creations of joint ventures and 28 R&D alliances. We successfully completed our acquisition of Chattem, one of the leading manufacturers and distributors of branded consumer health products,
toiletries and dietary supplements in the United States. We also strengthened our Consumer Health Care platform through the acquisition of Nepentes S.A. in Poland, as well as the creation of a joint venture with Minsheng Pharmaceutical Co., Ltd. and
the acquisition of BMP Sunstone Corporation in China. In the generics sector, we created a joint venture with the Japanese company Nichi-Iko Pharmaceutical Co., Ltd. We also acquired two R&D companies: the U.S. biopharmaceutical company TargeGen
Inc., which develops small molecule kinase inhibitors for the treatment of certain forms of leukemia, lymphoma and other hematological malignancies and blood disorders; and the U.S. biotechnology company VaxDesign, which develops in vitro models of
the human immune system used for the development of vaccines. In Animal Health, on March 8, 2010, we exercised our contractual right to combine the Intervet/Schering-Plough Animal Health business with Merial to form a new animal health joint
venture equally owned by the new Merck and sanofi-aventis, which when completed will create a global leader in Animal Health. On February 16, 2011, sanofi-aventis announced an agreement to acquire Genzyme Corp., a leading U.S.-based biotechnology
company specializing in the treatment of rare diseases. The agreement is described at Item 10. Additional Information  C. Material Contracts and any acquisition remains subject to fulfillment of a number of conditions including
acceptance of the transaction by holders of a majority of shares of Genzyme common stock on a diluted basis.



We expect our sound financial position should give us significant potential to create value via external growth opportunities, with the
aim of securing a return on investment in excess of our cost of capital.



Pharmaceutical Products



Main Pharmaceutical Products



Within our Pharmaceuticals business, we focus on the following categories: diabetes, oncology, and other flagship products in anti-thrombotics and cardiovascular fields.



The sections that follow provide additional information on
the indications and market position of these products in their principal markets. Our intellectual property rights over our pharmaceutical products are material to our operations and are described at  Patents, Intellectual Property and
Other Rights below. As disclosed in Note D.22.b) to our consolidated financial statements included at Item 18 of this annual report, we are involved in significant litigation concerning the patent protection of a number of these products.



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The following table sets forth the net sales of our best-selling pharmaceutical products for
the year ended December 31, 2010. These products are major contributors to public health.



|                                                                      |  |                          |       |  |                                   |                                                                                                       
|--------------------------------------------------------------------- |  | ------------------------ | ----- |  | --------------------------------- | ------------------------------------------------------------------------------------------------------
|Therapeutic Area / Product Name                                       |  | 2010Net Sales( million) |       |  | Drug Category / Main Areas of Use
|Diabetes                                                              |  |                          |       |  |                                   |                                                                                                       
|Lantus®
(insulin glargine)                                            |  |                          | 3,510 |  |                                   | Long-acting analog of human insulin                                                                   
|                                                                      |  |                          |       |  |                                   |  Type 1 and 2 diabetes mellitus                                                                      
|Apidra®
(insulin glulisine)                                           |  |                          | 177   |  |                                   | Rapid-acting analog of human insulin                                                                  
|                                                                      |  |                          |       |  |                                   |  Type 1 and 2 diabetes mellitus                                                                      
|Amaryl®
(glimepiride)                                                 |  |                          | 478   |  |                                   | Sulfonylurea                                                                                          
|                                                                      |  |                          |       |  |                                   |  Type 2 diabetes mellitus                                                                            
|Insuman®
(insulin)                                                    |  |                          | 133   |  |                                   | Human insulin (rapid and intermediate acting)                                                         
|                                                                      |  |                          |       |  |                                   |  Type 1 and 2 diabetes mellitus                                                                      
|Oncology                                                              |  |                          |       |  |                                   |                                                                                                       
|Taxotere®
(docetaxel)                                                 |  |                          | 2,122 |  |                                   | Cytotoxic agent                                                                                       
|                                                                      |  |                          |       |  |                                   |  Breast cancer
 Non small cell lung cancer
 Prostate cancer
 Gastric cancer
 Head and Neck cancer
|Eloxatine®
(oxaliplatin)                                              |  |                          | 427   |  |                                   | Cytotoxic agent                                                                                       
|                                                                      |  |                          |       |  |                                   |  Colorectal cancer                                                                                   
|Jevtana®
(cabazitaxel)                                                |  |                          | 82    |  |                                   | Cytotoxic agent                                                                                       
|                                                                      |  |                          |       |  |                                   |  Prostate cancer                                                                                     
|Other Flagship products                                               |  |                          |       |  |                                   |                                                                                                       
|Lovenox®
(enoxaparin sodium)                                          |  |                          | 2,806 |  |                                   | Low molecular weight heparin                                                                          
|                                                                      |  |                          |       |  |                                   |  Treatment and prevention of deep vein thrombosis
 Treatment of acute coronary syndromes            
|Plavix®
(clopidogrel bisulfate)                                       |  |                          | 2,083 |  |                                   | Platelet adenosine disphosphate receptor antagonist                                                   
|                                                                      |  |                          |       |  |                                   |  Atherothrombosis
 Acute coronary syndrome with and without ST segment elevation                    
|Aprovel®
(irbesartan) / CoAprovel® (irbesartan & hydrochlorothiazide) |  |                          | 1,327 |  |                                   | Angiotensin II receptor antagonist                                                                    
|                                                                      |  |                          |       |  |                                   |  Hypertension                                                                                        
|Multaq®
(dronedarone)                                                 |  |                          | 172   |  |                                   | Anti-arrhythmic drug                                                                                  
|                                                                      |  |                          |       |  |                                   |  Atrial Fibrillation                                                                                 
|Others                                                                |  |                          |       |  |                                   |                                                                                                       
|Stilnox®
/Ambien®/Myslee® (zolpidem tartrate)                         |  |                          | 819   |  |                                   | Hypnotic                                                                                              
|                                                                      |  |                          |       |  |                                   |  Sleep disorders                                                                                     
|of which Ambien® CR                                                   |  |                          | 378   |  |                                   |                                                                                                       
|Allegra®
(fexofenadine hydrochloride)                                 |  |                          | 607   |  |                                   | Anti-histamine                                                                                        
|                                                                      |  |                          |       |  |                                   |  Allergic rhinitis
 Urticaria                                                                       



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|                                    |  |                          |     |  |                                   |                                                        
|----------------------------------- |  | ------------------------ | --- |  | --------------------------------- | -------------------------------------------------------
|Therapeutic Area / Product Name     |  | 2010Net Sales( million) |     |  | Drug Category / Main Areas of Use
|Copaxone®
(glatiramer acetate)      |  |                          | 513 |  |                                   | Non-interferon immunomodulating agent                  
|                                    |  |                          |     |  |                                   |  Multiple sclerosis                                   
|Tritace®
(ramipril)                 |  |                          | 410 |  |                                   | Angiotensin Converting Enzyme Inhibitor                
|                                    |  |                          |     |  |                                   |  Hypertension
 Congestive heart failure
 Nephropathy
|Depakine®
(sodium valproate)        |  |                          | 372 |  |                                   | Anti-epileptic                                         
|                                    |  |                          |     |  |                                   |  Epilepsy                                             
|Xatral®
(alfuzosin hydrochloride)   |  |                          | 296 |  |                                   | Uroselective alpha1-blocker                            
|                                    |  |                          |     |  |                                   |  Benign prostatic hypertrophy                         
|Actonel®
(risedronate sodium)       |  |                          | 238 |  |                                   | Biphosphonate                                          
|                                    |  |                          |     |  |                                   |  Osteoporosis
 Pagets Disease                       
|Nasacort®
(triamcinolone acetonide) |  |                          | 189 |  |                                   | Local corticosteroid                                   
|                                    |  |                          |     |  |                                   |  Allergic rhinitis                                    



Diabetes



The prevalence of diabetes is expected
to increase significantly over the next 20 years, reflecting multiple socio-economic factors including sedentary lifestyles, excess weight and obesity, unhealthy diet and an aging population. Our principal diabetes products are Lantus®, a long-acting analog of human insulin; Apidra®, a rapid-acting analog of human insulin;
Insuman®, a human insulin; and Amaryl®, a sulfonylurea. In 2011 the company expects to market the BGStar® solution range of Blood Glucose Monitors for insulin patients.



Lantus®



Lantus® (insulin glargine) is a long-acting analog of human insulin, offering improved pharmacokinetic and pharmacodynamic profiles compared to other basal insulins. Lantus® is indicated for once-daily subcutaneous administration in the treatment of adult patients with type 2 diabetes
mellitus who require basal insulin for the control of hyperglycemia, and for adult and pediatric patients aged six years and above with type 1 diabetes mellitus.



Lantus® is a well established treatment with over 30 million patient-years exposure since 2000. The clinical trial
experience with Lantus® covers over 100,000 patients.



Lantus® can be administered subcutaneously using syringes or specific pens including the Lantus® SoloSTAR® disposable pen and
the ClikSTAR® reusable pen:



| |  |  | Lantus®
SoloSTAR® is a pre-filled disposable pen available in over 50 countries worldwide. It is the only disposable pen
that combines a low injection force, up to 80 units per injection, and ease-of-use; and
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | ClikSTAR® is a
reusable insulin pen first approved in 2009 in the European Union and Canada. It is now available in more than 35 countries worldwide and is being reviewed by the U.S. Food and Drug Administration (FDA).
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In September 2009, following four highly
publicized but methodologically limited registry analyses, some of which created concern over a potential link between the use of Lantus® and an increased risk of cancer, we announced an action plan to provide methodologically robust research that will contribute to the scientific resolution of the
debate over insulin safety, including insulin analogs and Lantus®. The research program encompasses both
preclinical and clinical programs involving human insulin and insulin analogues, including



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insulin glargine; it is designed to generate more information on whether there is any association between cancer and insulin use, and to assess whether there is any difference in risk between
different types of insulins. The plan is structured to yield short-term and longer-term results. Three epidemiological studies (two retrospective cohort studies and one case-control study) have been launched:



| |  |  | the Northern European Study will compare the risk of cancer in adults prescribed insulin glargine versus those prescribed human insulin, and other
types of insulin, and in all users of insulin combined. Study data are expected to be released in the second quarter of 2011;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the U.S. Study will compare the risk of breast, prostate and colon cancer (each considered separately) in glargine users versus human NPH insulin
users. Study completion is targeted for the second half of 2011; and
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the International Study of Insulin and Cancer, being carried out in the United Kingdom, France and Canada, will assess the association of breast cancer
with the use of insulins. The study results are expected by end 2012.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Routine analysis of the dataset for the ongoing large-scale ORIGIN randomized trial provided no cause for concern with respect to cancer incidence in the glargine group.



In January 2011, the FDA updated its
ongoing safety review of Lantus®. In addition to the analysis of the four registry analyses mentioned above, the
FDA also reviewed results from a five-year diabetic retinopathy clinical trial in patients with type 2 Diabetes. Based on these data, the FDA has not concluded at this time that Lantus® increases the risk of cancer. FDA review remains ongoing.



The ADA/ACS (American Diabetes Association / American Cancer Society) Consensus Report published on June 16, 2010 reasserted the
inconclusiveness of any link between insulin and cancer.



The American Diabetes Association (ADA) and European Association for the Study of Diabetes (EASD) have maintained their 2008 treatment recommendations for type 2 diabetes. These guidelines further
established basal insulins such as Lantus®, or a sulfonylurea such as Amaryl®, as two preferred second-line treatment options for people with diabetes who are unable to achieve glycemic control
targets with lifestyle intervention and metformin alone. These treatment recommendations reinforce the timely use of basal insulin as a core therapy for type 2 diabetes.



Lantus® is the world number-one selling insulin brand in terms of both sales and units (source: IMS, 2010 sales) and is
available in over 70 countries worldwide. The three leading countries for sales of Lantus® in 2010 were the
United States, France and Germany.



Apidra®



Apidra® (insulin glulisine) is a rapid-acting analog of human insulin. Apidra® is indicated for the treatment of adults with type 1 diabetes, or in type 2 diabetes for supplementary glycemic
control. Apidra® has a more rapid onset and shorter duration of action than fast-acting human insulin and can be
associated with long-acting insulins such as Lantus® for supplementary glycemic control at mealtime.



In addition, Apidra® is equally effective in adult diabetics ranging from lean to obese and offers patients greater flexibility of
administration, either before or just after mealtime.



Apidra® can be administered subcutaneously using syringes or
specific pens including the Apidra® SoloSTAR® disposable pen and the
ClikSTAR® reusable pen.



Apidra® was launched in Germany in 2004, in other European countries in 2005, in the United States in 2006, and in Canada and Japan in 2009. Apidra® is available in over 60 countries worldwide.



Insuman®



Insuman® (human insulin) is a range of insulin solutions and suspensions for injection and is indicated for diabetes patients where treatment with insulin is required. Human
insulin is produced by recombinant DNA technology in Escherichia coli.



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Insuman® is supplied in vials, cartridges, or pre-filled disposable pens (OptiSet® and SoloStar®) containing the
active substance human insulin. The Insuman® range is comprised of rapid-acting insulin solutions (Insuman® Rapid and Insuman® Infusat) that contain soluble insulin, an intermediate-acting insulin suspension (Insuman® Basal) that contains isophane insulin, and combinations of fast- and intermediate-acting insulins in various proportions (Insuman® Comb). Insuman® is mostly sold in Germany.



Amaryl®/Amarel®/Solosa®



Amaryl® (glimepiride) is a latest-generation, orally administered once-daily sulfonylurea (a glucose-lowering agent) indicated as an adjunct to diet and exercise to improve
glycemic control in patients with type 2 diabetes. Amaryl® reduces the bodys blood sugar level in two
ways: by helping the body to produce more insulin both at mealtime and between meals, and by decreasing insulin resistance.



The combination of metformin (which reduces hepatic glucose production and decreases insulin resistance) with a
sulfonylurea such as Amaryl® is a rational combination for counteracting the two defects seen in type 2
diabetes. It is one of the most prescribed combinations of diabetes drugs worldwide. Amaryl M®, a fixed-dose
combination of Amaryl® plus metformin in a single presentation, was launched in 2007.



Our leading market for Amaryl® is Japan, where it is the best-selling oral anti-diabetes product by volume (source: IMS 2010 sales). A number of
generics have received marketing authorization and have been launched in Europe and the United States. Generics recently became available in Japan (November 2010), but have not significantly impacted Amaryl® sales.



BGStar® / iBGStar



Sanofi-aventis and its partner AgaMatrix are co-developing innovative solutions in diabetes care with the aim of
simplifying the diabetes management experience for patients and healthcare providers. The blood glucose monitoring solutions will be exclusive to sanofi-aventis and are designed to be synergistic with our diabetes portfolio, with a positive effect
on sales of Lantus® and other products expected.



BGStar® and iBGStar are blood glucose meters that feature Dynamic Electrochemistry®, an innovative technology that extracts a spectrum of information from blood that is inaccessible to traditional electrochemical methods and compensates for many
interfering factors that can often distort blood glucose results.



These monitoring devices are an important step towards our vision of becoming the leader in global diabetes care by integrating innovative monitoring technology, therapeutic innovations, personalized
services and support solutions. The first blood glucose monitoring (BGM) devices, BGStar® and iBGStar, are
scheduled to become commercially available in 2011.



BGStar® has received regulatory approval for the U.S. market (FDA)
and for Europe. iBGStar has received regulatory approval for Europe, and was submitted in Q4 2010 in the United States.



The main compounds currently in Phase II or III clinical development in the Diabetes/Other Metabolic Disorders field are:



| |  |  | Lixisenatide (AVE0010 GLP-1: Glucagon-like peptide-1 agonist, type 2 diabetes mellitus; Phase III). (lixisenatide is in-licensed from Zealand
Pharma A/S). In Phase IIb, once-a-day dosing with lixisenatide was shown to be effective in lowering blood sugar and decreasing body weight with good tolerability. Enrollment to the nine studies of the GETGOAL Phase III program in adult patients
with type 2 diabetes mellitus was completed at the end of 2009. Positive results were obtained from the first Phase III trials with AVE0010, and were presented at EASD in Stockholm. An initial study investigating use of AVE0010 on top of basal
insulins confirmed improvement of HbA1C. A program evaluating the benefit of a combination of lixisenatide /
Lantus® is currently in Phase I.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The GPR119 receptor agonist SAR260093, currently in Phase II, has a dual mode of action affecting both insulin and GLP-1 release. It is in-licensed
from Metabolex.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | SAR236553, co-developed with Regeneron (REGN727) entered Phase II in January 2011. The target indication is LDL reduction in patients with
familial hypercholesterolemia not at goal with statins.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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Oncology



Sanofi-aventis is present in the
oncology field, primarily in chemotherapy, with three major products: Taxotere®, Eloxatine®, and Jevtana®, which was launched commercially in the United States in July 2010.



Taxotere®



Taxotere® (docetaxel), a taxoid class derivative, inhibits cancer cell division by essentially freezing the cells internal skeleton, which is comprised of
microtubules. Microtubules assemble and disassemble during a cell cycle. Taxotere® promotes their assembly and
blocks their disassembly, thereby preventing many cancer cells from dividing and resulting in death in some cancer cells.



Taxotere® is available in more than 100 countries as an injectable solution. It has gained approval for use in eleven indications in five different tumor types (breast,
prostate, gastric, lung, and head and neck). Taxotere® is indicated for early stage and metastatic breast
cancer, first-line and second-line metastatic Non-Small Cell Lung Cancer (NSCLC), androgen-independent (hormone-refractory) metastatic prostate cancer, advanced gastric adenocarcinoma (including adenocarcinoma of the gastroesophageal junction), and
the induction treatment of patients with locally advanced squamous cell carcinoma of the head and neck.



The GEICAM 9805 study, published in December 2010 in the New England Journal of Medicine, demonstrated that women with node negative
cancer benefited from the addition of Taxotere to anthracycline therapy, a commonly used regimen.



The single vial formulation (one vial IV route 20-80mg) was approved in the U.S. in August 2010 (approved in the
European Union in November 2009). A dossier for the pediatric indication for Taxotere® (designed to be
responsive to the FDAs prior written request for pediatric data) was approved by the FDA in May 2010.
Taxotere® was also approved by Chinas State Food And Drug Administration in May 2010 for the treatment of
patients with hormone-refractory metastatic prostate cancer.



The top four countries contributing to sales of Taxotere® in 2010
were the United States, France, Japan and Germany. Generics of docetaxel were launched at the end of 2010 in Europe. In the United States we anticipate that the FDA will grant final approval to one or more generics of docetaxel in 2011.



Eloxatine®



Eloxatine® (oxaliplatin) is a platinum-based cytotoxic agent. Eloxatine® combined with infusional (delivered through the bloodstream) administration of two other chemotherapy drugs, 5-fluorouracil/leucovorin (the FOLFOX regimen), is
approved by the FDA for adjuvant treatment of people with stage III colon cancer who have had their primary (original) tumors surgically removed. This approval was based on evidence of an improvement in disease-free survival after four years.



Following the end of the
Eloxatine® European regulatory data exclusivity in April 2006, a number of oxaliplatin generics have received
marketing authorization and have been launched throughout Europe. With regard to the U.S. market, a number of oxaliplatin generics received final marketing authorization from the FDA and were marketed until June 30, 2010, when their
manufacturers were ordered by the U.S. District Court for the District of New Jersey to cease selling their unauthorized
Eloxatine® generic in the United States. See Item 8. Financial Information  A.
Consolidated Financial Statements and other Financial Information.



Eloxatine® is in-licensed from Debiopharm and is marketed in more
than 70 countries worldwide.



Jevtana®



Jevtana® (cabazitaxel) is a new taxane derivative approved in combination with prednisone for the treatment of patients with hormone-refractory metastatic prostate cancer
previously treated with a docetaxel-containing treatment regimen. Jevtana® was the result of a 14-year research
and development program to address the significant unmet medical need after taxane-based treatment progression.



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The results of the TROPIC Phase III study were released for the first time at the 2010
Genitourinary Cancers Symposium in San Francisco in March 2010. The study was published in The Lancet on October 2, 2010. Updated study results as presented at the 2010 American Society of Clinical Oncology (ASCO) Annual Meeting in June 2010
demonstrated that cabazitaxel plus prednisone/prednisolone significantly improved overall survival versus the standard regimen of mitoxantrone plus prednisone/prednisolone in patients with metastatic hormone-refractory prostate cancer whose disease
progressed following treatment with docetaxel-based chemotherapy. A combination of cabazitaxel and prednisone/prednisolone significantly reduced the risk of death by 28% with an improvement in median overall survival of 15.1 months vs. 12.7 months
in the mitoxantrone combination arm.



In the United States, filing of the rolling New Drug Approval (NDA) was completed on March 31, 2010. The Jevtana® NDA was assigned priority review and was approved by the FDA on June 17, 2010 with its commercial launch a month later.



Jevtana® has been well accepted by patients, physicians, and public and private oncology healthcare payers in the United
States. Jevtana® therapy is now covered by CMS (Committee for Medicare and Medicaid Services), and by most of
the private insurance companies that pay for oncology care. In addition, the safety profile seen in clinical practice has been consistent with that seen in the pivotal TROPIC study. In January 2011, the EMAs Committee for Medicinal Products
for Human Use (CHMP) adopted a positive opinion recommending marketing authorization in the European Union for
Jevtana®.



Jevtana® was also approved in Brazil on October 26, 2010. Dossiers have been submitted in Canada, Australia, South Africa, Russia, Switzerland, Israel, Ukraine,
Argentina, Chile, Colombia, Uruguay, Paraguay, Venezuela, Mexico, Malaysia, Philippines, Thailand, Taiwan, Singapore, India and Morocco. Submissions are expected next in China, Peru and Costa Rica.



Two large phase III studies in hormone-refractory resistant
metastatic prostate cancer will begin recruiting patients in the first half of 2011. These include a study versus docetaxel in the first line setting and a study evaluating the optimal dose of cabazitaxel in the second line setting. In addition,
cabazitaxel is also being readied for study in small-cell lung cancer, gastric cancer, and pediatric settings.



The oncology pipeline includes a broad spectrum of novel agents with a variety of mechanisms of action for treating cancer,
including cytotoxic agents, anti-mitotic agents, anti-angiogenic agents, anti-vascular agents, targeted therapies and monoclonal anti-bodies.



| |  |  | BSI-201(iniparib: United States Adopted Name: INN pending) (Novel agent with PARP inhibitory activity, metastatic triple negative breast cancer
(mTNBC) and advanced squamous non-small cell lung cancer; Phase III). Developed by BiPar Sciences, Inc. (BiPar), a leader in the emerging field of DNA (deoxyribonucleic acid) repair acquired by sanofi-aventis in 2009, BSI-201 is currently being
evaluated for its potential to enhance the effect of chemotherapyinduced DNA damage. In January 2011, we announced results from a phase III study that was being conducted with iniparib (BSI-201). Results showed that iniparib failed to meet
primary end points of overall survival and progression-free survival in patients with metastatic triple-negative breast cancer. However, results suggested improvement of overall survival and progression-free survival in the second- and third-line
settings, consistent with earlier Phase II results. The overall safety analysis indicated that the addition of BSI-201 did not significantly add to the toxicity profile of gemcitabine and carboplatin. We plan to discuss these data with the United
States and European healthcare authorities in the near future. In parallel, BSI-201 is being developed in advanced squamous non-small cell lung cancer (Phase III) and in multiple additional solid tumors, including ovarian cancer and other breast and
lung tumors, (Phase II).
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Aflibercept (the VEGF Trap, anti-angiogenic agent; solid tumors; Phase III). The VEGF (Vascular Endothelial Growth Factor) Trap is being
developed under an alliance with Regeneron Pharmaceuticals, Inc (Regeneron). Aflibercept is a novel anti-angiogenic agent that acts as a decoy receptor or trap for circulating VEGF. Three double-blind comparative Phase III studies of
aflibercept versus placebo in combination with chemotherapy are ongoing in the following indications: second line metastatic colorectal cancer (mCRC) in combination with irinotecan/5-FU/LV (FOLFIRI regimen), VELOUR trial; second line non squamous
non-small cell lung cancer in combination with docetaxel, VITAL
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| | study; first line androgen independent metastatic prostate cancer in combination with docetaxel/prednisone, VENICE study. Patient recruitment has been completed for all trials. Recruitment to a
fourth study in first line metastatic pancreas cancer was prematurely discontinued in September 2009 based on the recommendation of an Independent Data Monitoring Committee (IDMC). As part of a planned interim efficacy analysis, the IDMC determined
that the addition of aflibercept to gemcitabine would be unable to demonstrate a statistically significant improvement in the primary endpoint of overall survival compared to placebo plus gemcitabine as it was unlikely to demonstrate superiority
versus gemcitabine alone. Additional exploratory studies in earlier stage disease or other indications are being conducted either by sanofi-aventis and Regeneron or in collaboration with the U.S. National Cancer Institute.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Ombrabulin (AVE8062; combretastatin derivative, a new anti-vascular agent in-licensed from Ajinomoto; sarcoma; Phase III). Single agent and
combination studies with platinums and taxanes alone and in combination have been conducted with ombrabulin. A Phase III study in soft tissue sarcoma in combination with cisplatin was initiated in 2008 and is over 90% enrolled.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | SAR245408 (XL147) was in-licensed from and is being developed under an alliance with Exelixis, Inc. This phosphoinositide-3-kinase (PI3K)
inhibitor is under evaluation in a Phase II study of monotherapy for the treatment of advanced or recurrent endometrial cancer. Combinations with paclitaxel/carboplatin, erlotinib, letrozole and trastuzumab are also being evaluated. This oral agent
is being developed for the treatment of women with endometrial or breast cancer.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | SAR245409 (XL765) was also in-licensed from and is being developed under an alliance with Exelixis, Inc. This oral agent is an inhibitor of
phosphoinositide-3-kinase (PI3K) and also acts against the mammalian target of rapamycin (mTOR). A Phase I/II study in combination with letrozole for the treatment of metastatic hormone-receptor-positive breast cancer has been initiated.
Combinations with erlotinib and temozolomide are also being evaluated.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In December 2010, sanofi-aventis and Merck Serono (a division of Merck KGaA, Darmstadt, Germany) announced that they had
signed a worldwide research and development agreement to collaboratively investigate novel combinations of investigational agents that could block specific pathways in cancer cells. The novel combinations involve Merck Seronos MEK inhibitor
MSC1936369B (also known as AS703026), our PI3K/ mTOR inhibitor SAR245409 (also known as XL765), and our class I PI3K inhibitor SAR245408 (also known as XL147). Phase I dose escalation studies of these product candidates are
projected for 2011.



| |  |  | SAR256212(MM-121). Under an exclusive global collaboration and licensing agreement, Merrimack and sanofi-aventis are co-developing SAR256212, a
fully human monoclonal antibody targeting ErbB3. ErbB3 has been identified as a key node in tumor growth and survival. SAR256212 blocks Heregulin binding to ErbB3, and formation of pErbB3 and pAKT. Given SAR256212s broad applicability it has
the potential to be used in a wide selection of tumors and settings. SAR256212 is in phase II stage of development (a proof of concept study in ER/PR+ breast cancer patients after failure of aromatase inhibitors), while a number of combinations with
chemotherapy and targeted agents are being explored in the phase I program. A companion diagnostic tool is being developed in parallel with the clinical program.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In 2010, we conducted several additional collaborations with
other companies, universities and institutes to investigate novel oncology agents (see  Pharmaceutical Research & Development  Portfolio below).



Other Flagship Products



Lovenox®/Clexane®



Lovenox® (enoxaparin sodium) is the most widely studied and prescribed low molecular weight heparin (LMWH) in the world. Available in over 100 countries, it has been used to
treat over 350 million patients since its launch.



Lovenox® has the broadest range of indications amongst LMWHs. A
comprehensive clinical development plan has demonstrated the efficacy and safety of Lovenox in the prevention and treatment of venous thrombo-embolism (VTE) and in the management of the full spectrum of acute coronary syndromes (ACS).



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In VTE management, Lovenox® is continuing to grow as a treatment for the prevention of VTE, mainly in acutely ill patients not undergoing
surgery.



In 2008, new oral
anticoagulants were launched for the prevention of VTE in orthopedic surgery. These indications represent only around 15% of
Lovenox® usage in 2010. After two years, the impact on
Lovenox® usage has been limited. The next expected indication for these new oral anticoagulants is stroke
prevention in atrial fibrillation, replacing vitamin K antagonists (e.g. warfarin), with no direct impact expected on
Lovenox® since stroke prevention in atrial fibrillation is not a Lovenox® approved indication.



On July 23, 2010, the FDA approved a generic of enoxaparin and rated it as fully substitutable for Lovenox®. Sanofi-aventis has expressed concern over potential implications for patient safety, since the approved product has
not been subject to clinical comparison with Lovenox in order to demonstrate similar safety and efficacy. Clinical testing is considered by many experts and the EMA as the appropriate way to ensure sameness in the absence of clear demonstration of
the identical composition, which is generally not possible to demonstrate for complex medicines of biological origin. Consequently, sanofi-aventis requested a U.S. district court to provide relief against the FDA review process.



In 2010, Lovenox® was the leading anti-thrombotic in the United States, Germany, France, Italy, Spain, and the United Kingdom (source:
IMS 2010 sales).



Plavix® / Iscover®



Plavix® (clopidogrel bisulfate), a platelet adenosine diphosphate (ADP) receptor antagonist with a rapid onset of action that selectively inhibits platelet aggregation
induced by ADP, is indicated for long-term prevention of atherothrombotic events in patients with a history of recent myocardial infarction, recent ischemic stroke or established peripheral arterial disease. Plavix® 75mg is indicated for the secondary prevention of atherothrombosis regardless of the location of the arteries
initially affected (heart, brain, lower limbs). This indication is supported by the results of the landmark CAPRIE trial, including almost 20,000 patients. CAPRIE demonstrated the superior efficacy of Plavix® over acetylsalicylic acid (ASA, the active ingredient of Aspirin®), with a comparable safety profile.



Following the significant results of several clinical trials, involving a total of almost 62,000 patients, Plavix® 75mg is now also indicated for the treatment of acute coronary syndrome (ACS) with and without ST segment elevation
in combination with ASA.



Plavix® is also available in a 300 mg tablet that reinforces early use by simplifying its approved loading dose administration in patients with ACS.



In January 2011, on the basis of the
ACTIVE A study results (7,554 patients), the EMA granted marketing authorization for Plavix® in combination with
ASA for the prevention of atherothrombotic and thromboembolic events, including stroke, in patients with atrial fibrillation who have at least one risk factor for vascular events, are not suitable for treatment with Vitamin K antagonists (VKA), and
have a low bleeding risk. This indication has also been granted by Canadian Authorities. A dossier supporting this indication is under review by the FDA.



A Phase III mortality and shunt-related morbidity study in infants palliated with a systemic to pulmonary artery shunt
was completed in 2010. Even though results did not support an indication in such infants, the FDA granted sanofi-aventis an additional six month period of exclusivity to market Plavix® (clopidogrel bisulfate). Exclusivity for
Plavix® in the U.S. is now scheduled to expire on May 17, 2012.



To further characterize patient
responsiveness to Plavix® and provide the best guidance to healthcare professionals, a clinical program designed
in close collaboration with the FDA has been completed by sanofi-aventis and Bristol-Myers Squibb (BMS). Based on this program the label has been updated worldwide, including new results on the pharmacological interaction of omeprazole with Plavix® and recent pharmaco-genomics data which have shown genomic variability of the response to Plavix® treatment (diminished effectiveness in poor metabolizers). This has been highlighted in the U.S. label with a boxed
warning.



The extensive
clinical program for Plavix®, including all completed, ongoing and planned studies, is among the largest of its
kind, involving more than 130,000 patients overall. Plavix® indications are incorporated into



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major scientific guidelines in North America, Europe and Japan. Over 115 million patients in 115 countries are estimated to have been treated with Plavix® since its launch in 1998, providing significant evidence of real-life efficacy and safety experience with this
product.



In Europe, certain generic clopidogrel
products have been affected by the recall recommended in March 2010 by the European Medicines Agency (EMA). Sanofi-aventis clopidogrel products were not affected by the recall. We manufacture all of our clopidogrel-containing products for Europe in
full compliance with the relevant rules and regulations in force, including Good Manufacturing Practices (GMP).



CoPlavix® / DuoPlavin®, a fixed dose
combination of clopidogrel bisulfate and acetylsalicylic acid (ASA), is indicated for the prevention of atherothrombotic events in adult patients with acute coronary syndrome who are already taking both clopidogrel and ASA. The combination has
already been launched in several countries (including Australia, Germany, the Netherlands, Ireland, Spain, and Mexico).



The marketing of Plavix® / CoPlavix® / DuoPlavin® is organized through our alliance with BMS (see  Alliance with BMS below). Sales of Plavix® in Japan are consolidated by sanofi-aventis and are outside the scope of our alliance with BMS.



Plavix® is the leading anti-platelet in the U.S. and Chinese markets (source: IMS 2010 sales). In Europe, a number of
generics have received marketing authorization and have been launched, but Plavix® sales have proved resilient
in Germany and France, with market shares(1)by value of 44.8% in Germany and of 42.5% in France. Market share was 39.2% in Western Europe by value (IMS).



Aprovel®/Avapro® /Karvea®



Aprovel® (irbesartan) is an anti-hypertensive belonging to the class of angiotensin II receptor antagonists. These highly
effective and well tolerated antagonists act by blocking the effect of angiotensin II, the hormone responsible for blood vessel contraction, thereby enabling blood pressure to return to normal. In addition to Aprovel®/Avapro®/Karvea®, we also market
CoAprovel®/Avalide®/Karvezide®, a fixed dose
combination of irbesartan and hydrochlorothiazide (HCTZ), a diuretic that increases the excretion of water and sodium by the kidneys and provides an additional blood pressure lowering effect. These products achieve control of blood pressure in over
80% of patients, with a very good safety profile.



Aprovel® and CoAprovel® tablets are available in a wide range of dosages to fit the needs of patients with different levels of hypertension
severity.



Aprovel® is indicated as a first-line treatment for hypertension and for the treatment of nephropathy in hypertensive
patients with type 2 diabetes. CoAprovel® is indicated in patients whose blood pressure is not adequately
controlled with a monotherapy, but also as initial therapy in patients who are likely to need multiple drugs to achieve their blood pressure goals (in the United States only).



Aprovel® and CoAprovel® are marketed in more than 80 countries. The marketing of Aprovel® and CoAprovel® is organized
through an alliance with BMS (see  Alliance with BMS below). In Japan, the product is licensed/sub-licensed to Shionogi Co. Ltd and Dainippon Sumitomo Pharma Co. Ltd, respectively.



Alliance with BMS



Plavix® and Aprovel® are marketed through a series of alliances with BMS. The alliance agreements include marketing and financial arrangements that vary depending on the country in which
the products are marketed.



Three principal
marketing arrangements are used in the BMS alliance:



| |  |  | co-marketing: each company markets the products independently under its own brand names;
| | - |  | ----------------------------------------------------------------------------------------



| |  |  | exclusive marketing: one company has the exclusive right to market the products; and
| | - |  | ------------------------------------------------------------------------------------



| |  |  | co-promotion: the products are marketed through the alliance arrangements (either by contractual arrangements or by separate entities) under a
single brand name.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------



|(1) | Plavix® market = oral platelet aggregants inhibitors + oral aspirin£325mg + oral dipyridamole.
|--- | ----------------------------------------------------------------------------------------------



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Under the alliance arrangements, there are two territories, one under
our operational management and the other under the operational management of BMS. The territory under our operational management consists of Europe and most of Africa and Asia, while the territory under the operational management of BMS consists of
the rest of the world excluding Japan. In Japan, Aprovel® has been marketed jointly by Shionogi Pharmaceuticals
and Dainippon Sumitomo Pharma Co. Ltd since June 2008. The BMS alliance does not cover rights to Plavix® in
Japan; sales of Plavix® in Japan are consolidated by sanofi-aventis.



In the territory under our operational management, the
marketing arrangements are as follows:



| |  |  | we use the co-promotion system for most of the countries of Western Europe for Aprovel® and Plavix® and for certain
Asian countries for Plavix®;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | we use the co-marketing system in Germany, Spain and Greece for both Aprovel® and Plavix® and in Italy for
Aprovel®; and
| | - |  | ------------------------------------------------------------------------------------------------------------------------



| |  |  | we have the exclusive right to market Aprovel® and Plavix® in Eastern
Europe, Africa and the Middle East, and we have the exclusive right to market Aprovel® in Asia, Scandinavia and
Ireland.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In the territory under
BMS operational management, the marketing arrangements are as follows:



| |  |  | we use the co-promotion system in the United States and Canada, where the products are sold through the alliances under the operational management of
BMS;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | we use the co-marketing system in Brazil, Mexico, Argentina and Australia for Plavix® and Aprovel® and in Colombia
only for Plavix®; and
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------



| |  |  | we have the exclusive right to market the products in certain other countries of Latin America.
| | - |  | -----------------------------------------------------------------------------------------------



In countries where the products are marketed by BMS on a
co-marketing basis, or through alliances under the operational management of BMS, we often sell the active ingredients for the products to BMS or associated entities.



The financial impact of our principal alliances on our
financial position and income is significant, and is described under Item 5. Operating and Financial Review and Prospects  Financial Presentation of Alliances; see also Item 3. Key Information  D. Risk Factors 
Risks Relating to Our Business  We rely on third parties for the marketing of some of our products for more information relating to risks in connection with our alliance agreements.



Multaq®



Multaq® (dronedarone) uniquely provides comprehensive management of Atrial Fibrillation (AF) with a view to improving cardiovascular outcomes.



Multaq® is a multichannel blocker with both rhythm (prevention of atrial fibrillation recurrences) and rate (decrease of
ventricular rate) controlling properties and additional effects (anti-hypertensive, vasodilatory). It is the first and only anti-arrhythmic drug to have shown a significant reduction in cardiovascular hospitalization and death in patients with
Atrial Fibrillation/Atrial Flutter.



Multaq® has a convenient fixed dose regimen of twice daily 400 mg
tablets to be taken with morning and evening meals. Treatment with Multaq® does not require a loading dose and
it can be initiated in an outpatient setting.



Multaq® is approved in over 50 countries worldwide and has been
launched in 29 countries including the largest pharmaceutical markets: the United States, and in 2010 in the top 5 European markets (Germany, the United Kingdom, Italy, Spain and France).



In the United States, Multaq® is indicated to reduce the risk of cardiovascular hospitalization in patients with paroxysmal or persistent AF or AFL, with a recent episode of AF/AFL and associated
cardiovascular risk factors.



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In Europe, Multaq® is indicated in adult clinically stable patients with a history of or with current non-permanent AF to prevent recurrence of AF or to lower ventricular rate.



The landmark ATHENA trial is
the only double-blind anti-arrhythmic study in patients with AF to have assessed morbidity-mortality. The study enrolled a total of 4,628 patients. In this trial, the efficacy and safety of Multaq® was evaluated in patients with AF/AFL or a recent history of these conditions. Multaq® 400mg twice a day, in addition to standard therapy, was shown to significantly reduce the risk of first cardiovascular hospitalization or death by 24% (p<0.001)
when compared to placebo, meeting the studys primary endpoint. In a secondary analysis of the ATHENA trial,
Multaq® significantly reduced the total number of hospital days versus placebo.



A Permanent Atrial fibriLLAtion outcome Study (PALLAS)
using dronedarone on top of standard therapy was initiated in the third quarter of 2010 to assess the potential clinical benefit in patients with permanent atrial fibrillation to reduce major adverse cardiovascular events. The multinational,
randomized, double-blind Phase IIIb trial has two composite co-primary endpoints: 1. Major cardiovascular events (stroke, systemic arterial embolism, myocardial infarction or cardiovascular death). 2. Cardiovascular hospitalization or
death from any cause. There will be 10,800 patients enrolled in 43 countries at 700 sites. The trial is event-driven with a fixed Common Study End Date, meaning that the study duration will depend upon the occurrence of a statistically required
number of outcome events.



In
September 2010, the European Society of Cardiology (ESC) issued their new Atrial Fibrillation guidelines that gave a clear and prominent first line use position to Multaq®. These were followed by the Canadian Cardiovascular Societys Guidelines which also recommended Multaq® as a first line treatment option for non-permanent AF patients with preserved heart function.



In January 2011, sanofi-aventis issued a
Dear Health Care Professional Letter in the U.S. and in the European Union informing health care providers of several cases of hepatocellular liver injury and hepatic failure in patients receiving Multaq®, including two post-marketing reports of acute hepatic failure requiring transplantation. The FDA also issued a Drug
Safety Communication on hepatic events reported in patients treated with Multaq®. In February 2011, both the EU
Summary of Product Characteristics and U.S. Prescribing Information were updated to include liver function monitoring. In Europe, EMA is coordinating a review of all available data concerning the possible risks of liver injury associated with the
use of Multaq® and their impact on its benefit-risk ratio.



Other pharmaceutical products



Stilnox®/Ambien® /Myslee®



Stilnox® (zolpidem tartrate) is indicated in the short-term treatment of insomnia. Stilnox® rapidly induces sleep that is qualitatively close to natural sleep and devoid of certain side effects that are
characteristic of the benzodiazepine class as a whole. Its action lasts for a minimum of six hours, and it is generally well tolerated, allowing the patient to awaken with a reduced risk of impaired attention, decreased alertness or memory lapses
throughout the day.



We have
developed a controlled release formulation of zolpidem tartrate, marketed only in the United States under the brand name
Ambien® CR.



Stilnox® is marketed in over 100 countries. It was launched in Japan under the brand name Myslee® in December 2000. Myslee® has
been co-promoted jointly with Astellas since 2006.



The top three markets contributing to sales of Stilnox® in 2010
(either immediate or controlled release formulations) were the United States, Japan and Italy. Generic zolpidem tartrate has been available in Europe since 2004. In the United States, generics of the immediate release formulation of Ambien® have been available since 2007. Ambien® CR generics entered the U.S. market in October 2010.



Allegra®/Telfast®



Allegra® (fexofenadine hydrochloride) is a long-lasting (12- and 24-hour) non-sedating prescription anti-histamine for the
treatment of seasonal allergic rhinitis (hay fever) and for the treatment of uncomplicated hives. It offers patients significant relief from allergy symptoms without causing drowsiness.



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We also market
Allegra-D® 12 Hour and Allegra-D® 24 Hour, anti-histamine/decongestant combination products with an extended-release decongestant for effective non-drowsy relief of seasonal allergy symptoms,
including nasal congestion. Generics of most forms of Allegra®/Tefast® have been approved in our major markets, with the notable exception of Japan.



In January 2011, the FDA approved the
Allegra® family for over-the-counter (OTC) use in adults and children two years of age and older.



Allegra®/Telfast® is marketed in approximately 80 countries. The largest market for Allegra® is Japan.



Copaxone®



Copaxone® (glatiramer acetate) is a non-interferon immunomodulating agent indicated for reducing the frequency of relapses in patients with relapsing-remitting multiple
sclerosis. Copaxone® is available as a self-injectable pre-filled syringe storable at room temperature for up to
one month.



This
disease-modifying drug is characterized by an original and specific mode of action on multiple sclerosis. Clinical studies have shown that Copaxone® is more effective than placebo at two years, but also that it has a clinical efficacy over 15 years both in reducing relapses and progression of disability. A
significant effect on lesions has also been confirmed by nuclear magnetic resonance imaging.



In 2009, the U.K. Medicine and Healthcare Regulatory Agency (MHRA) approved an expanded label for Copaxone® to include the treatment of patients with clinically isolated syndrome suggestive of multiple sclerosis.



We market Copaxone® outside the United States and Canada through our alliance with Teva (see  Alliance with Teva
below).



Alliance with Teva



We in-license Copaxone® from Teva and market it through an agreement with Teva, which was originally entered into in 1995, and has been
amended several times, most recently in 2005.



Under the agreement with Teva, marketing and financial arrangements vary depending on the country in which the products are marketed.



Outside the United States and Canada, there are
two principal marketing arrangements:



| |  |  | Exclusive marketing: we have the exclusive right to market the product. This system is used in a number of European countries (Portugal, Italy,
Greece, Finland, Denmark, Sweden, Norway, Iceland, Ireland, Luxembourg, Poland, Lichtenstein, Switzerland), as well as in Australia and New Zealand.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Co-promotion: the product is marketed under a single brand name. We use the co-promotion system in Germany, the United Kingdom, France, the
Netherlands, Austria, Belgium, the Czech Republic and Spain.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In the United States and Canada, Copaxone® was sold and distributed
by sanofi-aventis but marketed by Teva until March 31, 2008. On March 31, 2008, Teva assumed the
Copaxone® business, including sales of the product, in the United States and Canada. As a result, we no longer
record product sales or share certain marketing expenses with respect to the United States and Canada and, until March 31, 2010, we received a royalty from Teva of 25% of sales in these markets.



Under the terms of our agreement, the
Copaxone® business in countries other than the U.S. and Canada is being transferred to Teva over a period
running from the third quarter of 2009 to the first quarter of 2012 at the latest, depending on the country. Following the transfer, sanofi-aventis will receive from Teva a royalty of 6% for a period of two years, on a country-by-country basis. In
September 2009, the Copaxone® business was transferred to Teva in Switzerland and Lichtenstein. In 2010, the
Copaxone® business was transferred to Teva in Poland (September 2010), in the Czech Republic (October 2010) and
in the United Kingdom (December 2010). See Item 3. Key Information  D. Risk Factors  Risks Relating to Our Business  We rely on third parties for the marketing of some of our products, for more information relating to
risks in connection with our alliance agreements.



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Tritace®/Triatec® /Delix®/Altace®



Tritace® (ramipril) is an angiotensin converting enzyme (ACE) inhibitor indicated for the treatment of hypertension, congestive heart failure following or in the absence of
acute myocardial infarction, and nephropathy. Tritace® is the only ACE inhibitor approved for the prevention of
stroke, myocardial infarction and death in high-risk patients and has the broadest spectrum of indications among ACE inhibitors for the treatment of cardiovascular diseases.



The combinations with diuretics (ramipril +
hydrochlorothiazide) and calcium channel blockers (ramipril + felodipine) are available in Europe.



Tritace® is marketed in over 70 countries, including the United States where it is marketed by King Pharmaceuticals. A number of generics have received marketing authorization
and have been launched worldwide.



Depakine®



Depakine® (sodium valproate) is a broad-spectrum anti-epileptic that has been prescribed for more than 40 years. Numerous
clinical trials and long years of experience have shown that it is effective for all types of epileptic seizures and epileptic syndromes, and is generally well tolerated. Consequently, Depakine® remains a reference treatment for epilepsy worldwide.



Depakine® is also a mood stabilizer, registered in the treatment of manic episodes associated with bipolar disorder and, in numerous countries, in the prevention of mood
episodes. Depakine® is recommended as a first line treatment in these indications by international guidelines
such as the guidelines of the World Federation of Societies of Biological Psychiatry Guidelines 2009, the Canadian Network for Mood and Anxiety Treatments 2009, and the British Association for Psychopharmacology 2009.



We provide a wide range of formulations
of Depakine® enabling it to be adapted to most types of patients: syrup, oral solution, injection,
enteric-coated tablets, Chrono® (a sustained release formulation in tablets) and Chronosphere® (sustained release formulation of Depakine® packaged in stick packs, facilitating its use by children, the elderly and adults with difficulties swallowing).



Depakine® is marketed in over 100 countries, including the United States, where it is licensed to Abbott.



Xatral®/Uroxatral®



Xatral® (alfuzosin hydrochloride) belongs to the class of alpha1-blockers. Capable of acting selectively on the lower urinary tract, it was the first alpha1-blocker indicated
and marketed exclusively for the treatment of symptoms of benign prostatic hyperplasia (BPH). It is also the only alpha1-blocker indicated as an adjunctive therapy with catheterization for acute urinary retention, a painful and distressing
complication of BPH.



Xatral® OD (extended release formulation) is active from the first dose, provides rapid and lasting symptom relief, and
improves patient quality of life. Xatral® is the only alpha1-blocker showing no deleterious effect on
ejaculation, as shown by the final results of the international ALF-LIFE trial. The once-daily formulation of
Xatral® (branded Uroxatral® in the United States) has been registered in over 90 countries and is marketed worldwide, with the exception of Australia and Japan.



Generic alfuzosin became available in
most European countries in 2009. Pediatric exclusivity was granted for Uroxatral® in the United States,
prolonging the products claim to exclusivity until July 18, 2011.



Actonel®/Optinate® /Acrel®



Actonel® (risedronate sodium) belongs to the bisphosphonate class that helps prevent osteoporotic fractures.



Actonel® is the only osteoporosis treatment that reduces the risk of both vertebral and non-vertebral fractures in as little as six months. Actonel® also provides reduced risk of fracture at all key osteoporotic sites: vertebral, hip and non-vertebral sites,
studied as a composite endpoint (hip, wrist, humerus, clavicle, leg and pelvis).



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Actonel® is available in various dosage strengths and combination forms to better suit patient needs. Depending on dosage form, Actonel® is indicated for the treatment of post-menopausal osteoporosis, osteoporosis in men, or Pagets disease.



Actonel® is marketed in more than 75 countries through an alliance with Warner Chilcott (see Note C.2 to our consolidated
financial statements included at item 18 of this annual report).



The contribution of this alliance on our financial position and income is described under Item 5. Operating and Financial Review and Prospects  Financial Presentation of Alliances. See
Item 3. Key Information  D. Risk Factors  Risks Relating to Our Business  We rely on third parties for the marketing of some of our products for more information relating to risk in connection with our alliance
agreements.



Nasacort®



Nasacort®AQ Spray (NAQ) (triamcinolone acetonide) is an unscented, water-based metered-dose pump spray formulation unit containing a microcrystalline suspension of
triamcinolone acetonide in an aqueous medium. Previously indicated for the treatment of the nasal symptoms of seasonal and perennial allergic rhinitis in adults and children six years of age and older, Nasacort® AQ received an additional approval for the seasonal and annual treatment of pediatric patients between the ages of
two and five years from the FDA in September 2008. NAQ is an intranasal corticosteroid, which is recommended in treatment guidelines as first-line treatment for moderate to severe allergic rhinitis patients.



In settlement of patent litigation, Barr has been granted a
license to sell a generic triamcinolone acetonide in the United States as early as 2011.



Main compounds currently in Phase II or III clinical development:



In the Ophthalmology field



Sanofi-aventis acquired the French ophthalmology specialist Fovea in October 2009. Products in the pipeline include :



| |  |  | a Phase II eye-drop fixed dose combination of prednisolone and cyclosporine for allergic conjunctivitis (FOV1101);
| | - |  | ------------------------------------------------------------------------------------------------------------------



| |  |  | a phase II eye-drop formulation of a bradykinin B1 receptor antagonist for the treatment of diabetic macular edema (FOV2304); and
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------



| |  |  | a phase II intravitreal formulation of a protein inhibiting the kallikrein-kinin pathway for the treatment of retinal vein occlusion induced macular
edema (FOV2302).
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------



Oxford BioMedica has entered into a new collaboration with sanofi-aventis to develop novel gene-based medicines, utilizing LentiVector® gene delivery technology, for the treatment of ocular disease. The new agreement covers four LentiVector®-based product candidates for different ophthalmologic indications such as wet age-related macular degeneration, Stargardt disease, Usher syndrome, and corneal graft
rejection.



In the Thrombosis and Cardiovascular
field:



| |  |  | Otamixaban (direct factor Xa inhibitor, interventional cardiology; Phase III initiation). Otamixaban is an injectable, selective direct
inhibitor of coagulation factor Xa. It is a synthetic small molecule. Otamixaban exhibits a fast on- and off-set of action. A Phase III program to confirm the positive outcome from the SEPIA-ACS Phase II study was initiated in 2010 and is now
ongoing.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Semuloparin (indirect factor Xa/IIa inhibitor, prevention of VTE; Phase III) is a selectively engineered injectable ultra-low-molecular-weight
heparin with a novel anti-thrombotic profile combining a high anti-factor Xa activity and a residual anti-factor IIa activity. Development is primarily focused on primary prevention of venous thromboembolic events (VTE) in cancer patients undergoing
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| | chemotherapy, representing an attractive unmet medical need for VTE prevention. Data generated in prevention of VTE during surgery procedures have provided valuable information for appraising the
risk/benefit profile of semuloparin, which was shown to be a safe and effective anticoagulant. The semuloparin Phase III program in medical cancer patients has completed recruitment and continues as planned, with results expected to be presented in
2011.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Celivarone (anti-arrhythmic; Phase IIb). Based upon the results of a previous trial, a new Phase II study in patients fitted with an implantable
cardioverter/defibrillator is ongoing.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In the Central Nervous System field:



| |  |  | Teriflunomide (orally active dihydroorotate dehydrogenase inhibitor, multiple sclerosis; Phase III). An extensive Phase III monotherapy
development program in relapsing forms of multiple sclerosis is ongoing. Results of the first pivotal study, indicating that the product had an effect on disease activity in terms of relapse rate, disability progression and brain lesions with a
favorable safety profile, were presented at ECTRIMS (European Committee for Treatment and Research in Multiple Sclerosis) in October 2010. In addition, a Phase III adjunctive therapy study (TERACLES) has been launched to define the additional
efficacy and safety profile of teriflunomide, when added to background stable therapy with interferon (IFN-beta). This study follows on from the successful Phase II study which showed teriflunomide had an acceptable tolerability in adjunct to
IFN-beta and demonstrated significant improvements of the disease as measured by magnetic resonance imaging (MRI).
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | SSR125543 (a CRF1 receptor antagonist) is currently in phase II for major depressive disorders.
| | - |  | -----------------------------------------------------------------------------------------------



In the Internal Medicine field:



| |  |  | Ferroquine(4-aminoquinoline; malaria; Phase IIb). Ferroquine is a new 4-amino-quinoline being developed for the treatment of acute
uncomplicated malaria. Ferroquine is active against chloroquine sensitive and chloroquine resistant Plasmodium strains, and due to its long half-life has the potential to be part of single dose cure regimens and the unified global treatment of both
vivax and falciparum malaria. A Phase IIb study evaluating the optimal posology is currently ongoing.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Together with SAR97276(in Phase I see  Pharmaceutical Research & Development below), ferroquine is part of
our global commitment to fight neglected diseases which heavily impact populations of developing countries, as demonstrated by both our Access to Medicines group and the new Neglected Diseases Development Strategy and
Realization unit created within R&D. Our Access to Medicines group and Medicines for Malaria Venture (MMV) are conducting an extensive pharmacovigilance study (the first in this setting) to monitor the use and tolerability of
ASAQ (fixed-dose combination of artesunate and amodiaquine).



| |  |  | SAR153191, a monoclonal antibody against the Interleukin-6 Receptor (anti IL-6R mAb) derived from our alliance with Regeneron, has entered Phase
IIb in rheumatoid arthritis and ankylosing spondylitis.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Consumer Health Care (CHC)



Consumer Health Care is a core growth platform identified in our broader strategy for achieving sustainable growth. In 2010, we recorded CHC sales of 2,217 million; nearly half of our CHC sales were
in emerging markets, 28% in Europe, and 14% in the United States.



Organic growth in 2010 was supported by our CHC portfolio, which provides us with a strong presence in the analgesics, gastro-intestinal, and cough and cold areas.



| |  |  | Doliprane® is
a range of paracetamol formulas to fight pain and fever. Thanks to a wide offer both in terms of dosages (from 2.4% paracetamol suspension up to 1g formulas) and pharmaceutical forms (suspension, tablets, powder, suppositories), Doliprane® covers the needs of the patients from baby to elderly. Doliprane® is sold mainly in France. In August 2010, DolipraneLib® (500 mg paracetamol tablets) was launched in France in new easy-to-carry packaging.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Magne B6® is a
product containing magnesium and vitamin B6, which was granted its first marketing authorization in France in 1970. It has now been granted marketing authorizations in more than
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| | 40 countries around the world. MagneB6® has various
therapeutic indications from irritability, anxiety and sleep problems to womens health issues like premenstrual syndrome or menopause discomfort. MagneB6® is available in tablets and vials of oral solution.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Enterogermina®
is composed of two billion Bacillus clausii spores in a ready-to-drink oral suspension in vials of 5 ml and in capsules. Launched in liquid form in 1958 in Italy, the new two-billion dosage was launched in 2001; the capsule form was launched
in 2006. Enterogermina® is indicated in the prevention and the treatment of intestinal imbalance during acute or
chronic intestinal disorders (from babies to adults). Enterogermina® is sold mainly in Europe and has been
enjoying strong growth in Latin America.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Essentiale® is
a herbal preparation for liver therapy, made of highly purified essential phospholipids extracted from soybeans and containing a high percentage of phosphatidylcholine, a major constituent of cellular membrane. Essentiale® is used to treat symptoms such as lack of appetite, sensation of pressure in the right epigastrium,
toxico-nutritional liver damage and hepatitis. Essentiale® is sold mainly in Russia (37% growth) and some South
East Asian countries.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Maalox® is a
well established brand containing two antacids: aluminium hydroxide and magnesium hydroxide. Maalox® is
available in several pharmaceutical forms  tablets, suspension, and stick packs  to provide consumer choice.
Maalox® was launched first in France in 1972 and is now present in 55 countries; in Europe, Latin America,
Russia and in some Asian countries.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | NoSpa® is a
product containing drotaverine hydrochloride. NoSpa® is indicated in abdominal spastic pain such as intestinal
spasm, menstrual pain, or vesical spasm. NoSpa® is sold mainly in Russia and Eastern Europe.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Lactacyd® is a
range of liquid soaps for feminine hygiene. Lactacyd® is sold mainly in Brazil (28% growth) and Asia.
| | - |  | --------------------------------------------------------------------------------------------------------------------



| |  |  | Chattems products in the United States are mainly branded consumer healthcare products, toiletries and dietary supplements across niche market
segments. Chattems well known brands include Gold Bond®, Icy Hot®, ACT®, Cortizone-10®, Selsun Blue® and Unisom®.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In January 2011, the FDA approved the Allegra® family of allergy medication products for over-the-counter use in adults and children two years of age and older. The Allegra® family of OTC products will be available in drug, grocery, mass merchandiser and club stores nationwide. This switch
constitutes a key step in our CHC growth strategy in the U.S.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Following the recent acquisitions of Laboratoire Oenobiol, Kernpharm and Chattem, and the signature of a joint-venture agreement with Minsheng Pharmaceutical Co., Ltd, we conducted several additional
acquisitions and alliances in CHC in 2010:



| |  |  | The August 2010 acquisition of Nepentes S.A. was an important step in our diversification strategy in the fast-growing emerging European markets.
Nepentes is an opportunity for us to create a leading Consumer Health Care business in Poland, and will consolidate our leading position in Central and Eastern Europe. We intend Nepentes to accelerate its growth by extending its product lines and
developing outside Poland, with a diversified portfolio of dermocosmetics and medicines, including key brands like Iwostin and Emolium. The company has subsidiaries in Bulgaria and Romania.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | On October 28, 2010 we took another strategic step by entering into a definitive agreement with BMP Sunstone (a NASDAQ listed company), under
which sanofi-aventis acquired all outstanding shares of BMP Sunstone on February 24, 2011 for cash consideration of $10 per share, or a total of approximately $520.6 million on a fully diluted basis. BMP Sunstone markets the leading pediatric
cough and cold brand, Haowawa® (which means Goodbaby in Chinese), with a portfolio of both western
OTC drugs and traditional Chinese medicine (TCM) products. The acquisition will also bring sanofi-aventis a very well-established national distribution network providing unique access to the fast-growing prefecture level and rural level cities.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The joint venture with Minsheng Pharmaceutical Co., together with the acquisition of BMP Sunstone, will make sanofi-aventis a leading consumer health
care company in China, with a strong position in both Vitamins & Minerals Supplements and Cough & Cold, the two largest categories in this market source (Nicholas Hall, 2009). Sanofi-aventis will leverage its distribution strength
to launch its own OTC brands in the very near future.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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Generics



In 2010, sales of the generics business
grew by 41.5% to 1,534 million. This growth was boosted in Emerging Markets, especially Eastern Europe and Brazil, by the acquisitions of Zentiva, Kendrick and Medley, all completed in 2009. Another growth driver was the United States, where
we launched an authorized generic of Ambien® CR during the period, capturing more than 50% of total
prescriptions of Zolpidem CR generics (source IMS TRx end December). On a constant structure basis and at constant exchange rates, our generic business enjoyed solid organic growth of 18.5%. See Item 5. Operating and Financial Review and
Prospects  Results of Operations  Year Ended December 31, 2010 Compared with Year Ended December 31, 2009  Net Sales by Product  Pharmaceuticals.



In March 2009 we created our European Generics Platform, covering generics activities across Western and
Eastern Europe, Russia and Turkey. We have decided to rebrand all our European generics businesses under the Zentiva name. This means that the existing generics businesses of Winthrop and Helvepharm in Europe will operate under the Zentiva brand.
The rollout began in January 2011 in France, Germany, Italy, Switzerland, Portugal and the United Kingdom.



Following on from our 2009 acquisitions, we continued to expand our geographical reach in generics during 2010:



| |  |  | In May 2010, sanofi-aventis and Nichi-Iko Pharmaceutical Co., Ltd. (one of the fastest growing generics companies in Japan, and a market leader in that
country) announced an agreement to establish a new joint venture, sanofi-aventis Nichi-Iko K.K., to develop a generics business in Japan. The new joint venture will be held 51% by sanofi-aventis K.K. and 49% by Nichi-Iko Pharmaceutical Co., Ltd. and
will allow us to develop a strong presence in the fast-growing Japanese generics market.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Vaccine Products



Sanofi Pasteur is a fully integrated vaccines division offering the broadest range of vaccines in the industry
(source: internal estimates). In 2010, sanofi pasteur immunized over 500 million people against 20 serious diseases and generated net sales of 3,808 million. Sales were favorably impacted by strong growth in markets outside North America
and Europe, A(H1N1) pandemic influenza sales, continued growth of Pentaxim® sales and successful seasonal
influenza vaccine campaigns in both the Northern and Southern hemispheres. See Item 5. Operating and Financial Review and Prospects  Results of Operations  Year Ended December 31, 2010 Compared with Year Ended
December 31, 2009  Net Sales  Human Vaccines (Vaccines).



Sanofi Pasteur is a world leader in the vaccine industry in terms of sales. In the United States and Canada, sanofi pasteur is the market leader in the segments where we compete.



In Europe, sanofi pasteur vaccine
products are marketed by Sanofi Pasteur MSD, a joint venture created in 1994 and held equally by sanofi pasteur and Merck & Co. Inc., which serves 19 countries. In addition to sanofi pasteur products, Sanofi Pasteur MSD also distributes
such Merck & Co. vaccine products as Gardasil® in the joint ventures geographic scope. In 2010,
Sanofi Pasteur MSD net sales, which are accounted for using the equity method, amounted to 918 million.



Sanofi Pasteur has been expanding in Asia (China, India and Japan), Latin America (Mexico and Brazil), Africa, Middle-East and Eastern
Europe. Sanofi Pasteur is very active in publicly-funded international markets such as UNICEF and the Global Alliance for Vaccines and Immunization.



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The table below shows net sales of vaccines by product range:



|                                   |  |               |       | 
|---------------------------------- |  | ------------- | ----- | 
|( million)                        |  | 2010Net Sales |      
|Influenza Vaccines *               |  |               | 1,297 | 
|Polio/Pertussis/Hib Vaccines       |  |               | 984   | 
|Meningitis/Pneumonia Vaccines      |  |               | 527   | 
|Adult Booster Vaccines             |  |               | 449   | 
|Travel and Other Endemics Vaccines |  |               | 382   | 
|Other Vaccines                     |  |               | 169   | 
|Total Human Vaccines               |  |               | 3,808 | 



|* | Seasonal and pandemic influenza vaccines.
|- | -----------------------------------------



Pediatric Combination and Poliomyelitis (Polio) Vaccines



These vaccines vary in composition due to
diverse immunization schedules throughout the world.



Sanofi Pasteur is one of the key players in pediatric vaccines in both emerging and mature markets with a broad portfolio of standalone and combination vaccines protecting against up to five diseases in a
single injection.



Pentacel®, a vaccine protecting against five diseases (pertussis, diphtheria, tetanus, polio and Haemophilus influenzaetype b), was launched in the United States in 2008.



Pediacel®, another acellular pertussis-based pentavalent vaccine,
is the standard of care in the United Kingdom and the Netherlands for protecting against diphtheria, tetanus, pertussis, polio and Haemophilus influenzae type b disease. In November 2010, Pediacel® was approved in 29 countries across Europe.



Act-HIB®, for the prevention of Haemophilus influenzaetype b (Hib) infections, is also an important growth driver
within the pediatric product line. In 2008, Act-HIB® became the first Hib vaccine to be approved in Japan.



HexaximTM, a hexavalent pediatric vaccine (expected to provide protection
against diphtheria, tetanus, pertussis, polyomielitis (polio), Haemophilus influenzae type b infections and hepatitis B) is aimed specifically at the international region and is under development. The vaccine is currently in Phase III
clinical trials with regulatory submission anticipated in 2011.



Sanofi Pasteur is one of the worlds leading developers and manufacturers of polio vaccines, both oral (OPV) and enhanced injectable (eIPV) form. The worldwide polio eradication initiative led by the
World Health Organization (WHO) and UNICEF has positioned sanofi pasteur as a global preferred partner with both OPV and eIPV vaccines.



Sanofi Pasteur is also supporting the introduction of eIPV in the international region. With recent progress towards polio eradication,
Sanofi Pasteur expects the use of eIPV to gradually increase. As a result, sanofi pasteur is expanding its production capacity to meet the growing demand.



On July 25, 2010, the World Health Organization withdrew the prequalification of Shan5, a combination
vaccine protecting against five diseases (diphtheria, pertussis, tetanus, Haemophilus influenzae type b and hepatitis B) and ShantetraTM, a combination vaccine protecting against four diseases (diphtheria, pertussis, tetanus and hepatitis B) developed by
Shantha. This decision was driven by the abnormal visual appearance of the product. According to WHO/UNICEF, none of the information available to date suggests a safety problem with Shan5 or ShantetraTM. No adverse events following immunization with Shan5 or
Shantetra have been reported to the WHO. Sanofi Pasteur has designed an action plan geared to improving the robustness of the processes used by Shantha. A remediation plan was submitted to the WHO at the end of June 2010. Sanofi Pasteur is
dedicating its highest expertise to help Shantha regain the pre-qualification of Shan5 as early as possible.



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Influenza Vaccines



Sanofi Pasteur is a world leader in the production and marketing of influenza vaccines.
Sales of the influenza vaccines Fluzone® and Vaxigrip®/Mutagrip® have more than
tripled since 1995 and annual supply reached more than 200 million doses in 2010 to better meet increasing demand. Sanofi Pasteur expects the global demand for influenza vaccines to continue to grow within the next decade due to increased
disease awareness as a result of the A(H1N1) influenza pandemic, growth in emerging markets and wider government immunization recommendations.



In recent years, influenza vaccine demand has experienced strong growth in many countries, particularly in the U.S., South Korea, Brazil
and Mexico. Sanofi Pasteur expects this trend to continue over the coming years. Sanofi Pasteur will remain focused on maintaining its leadership in the influenza market and on meeting the increasing demand for both pandemic and seasonal vaccines
through the launch of innovative vaccines. In 2010, sanofi pasteur inaugurated its influenza vaccine facilities in Shenzhen (Guangdong Province, China) Ocoyoacac (Mexico) with the goal of producing influenza vaccines for those markets by 2012/2013.



In 2009, the European
Commission granted marketing authorization for sanofi pasteurs Intanza®/IDflu®, the first intradermal (ID) microinjection influenza vaccine. The advantages of this vaccine, particularly its
convenience and ease of administration, should help improve the coverage rate in Europe. This new vaccine for seasonal influenza is marketed as Intanza® or IDflu®. Intanza®/IDflu® vaccine is now approved in the European Union, Canada, Australia and other countries for the prevention of seasonal influenza in both adults (age 18 and over) and the
elderly (age 60 and over). In 2010, sanofi pasteur submitted Fluzone® ID for regulatory approval in the U. S.
Phase III data on the investigational Fluzone® Intradermal vaccine showed intradermal vaccine needed less
antigen and smaller injection volume than Fluzone®, administered by the intramuscular method, to induce a
comparable immune response. Sanofi Pasteur is seeking licensure of Fluzone® ID in the U.S. for adults from 18 to
64 years of age.



In December
2009, the FDA approved sanofi pasteurs supplemental Biologics License Application (sBLA) for licensing of
Fluzone® High-Dose influenza virus vaccine. The Fluzone® High-Dose vaccine was specifically designed to generate a more robust immune response in people 65 years of age or older. This age group, which typically shows a
weaker immune response, has proven to respond better to the Fluzone® High-Dose vaccine. This new vaccine
experienced a successful launch in the U.S. in 2010.



In September 2009, the FDA approved the companys supplemental Biologics License Application for its Influenza A(H1N1) 2009 Monovalent Vaccine, marking an important milestone in the pandemic
fight. The U.S. licensed vaccine is an inactivated influenza virus vaccine indicated for active immunization of adults and children aged six months and older against influenza caused by the A(H1N1) 2009 virus. Sanofi Pasteur provides the only
influenza vaccine licensed in the United States for populations as young as six months of age. In 2010, sanofi pasteur delivered 126 million doses of A(H1N1) vaccines worldwide.



In November 2009, Panenza® (non-adjuvanted A(H1N1) vaccine) was registered by the Agence Française de Sécurité Sanitaire des Produits de Santé (AFSSAPS). The
vaccine was made available to the French authorities, and vaccination began in France in November 2009. Panenza®
is also registered in Spain, Luxemburg, Germany, Brazil, Hong Kong, Slovakia, Thailand, Tunisia and Turkey. In February 2010, the EMA granted marketing authorization for Humenza®, an adjuvanted A(H1N1) monovalent influenza vaccine for the active immunization of persons aged over 6 months against influenza infections caused by the 2009 A(H1N1)
pandemic virus.



Fluzone® QIV candidate vaccine is a quadrivalent inactivated influenza vaccine containing two antigens of type A (H1N1 and
H3N2) and two antigens of type B (one each from Yamagata and Victoria lineage). Selecting the prevailing influenza strains for upcoming seasons is an incredibly difficult task. In the recent past, there have been a number of mismatches of the B
strain component in the trivalent vaccine compared with the circulating B lineage. Sanofi Pasteur expects that increasing the number of strains in the vaccine will give increased protection against the most prevalent strains. The targeted population
is the same as standard-dose Fluzone® TIV (trivalent vaccine): children 6 months through 17 years, and adults
and elderly 18 years and above. In October 2010, sanofi pasteur released positive results. The Phase II clinical trial showed the QIV was immunologically non-inferior to trivalent vaccines with just one of the B strains, and their safety profiles
did not materially differ. Our candidate vaccine entered phase III in October 2010.



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Adult and Adolescent Boosters



The incidence of pertussis (whooping
cough) is on the rise globally, affecting children, adolescents and adults (source: WHO publication WER 2005). Its resurgence, in particular in the State of California in the U.S. and other parts of the world in 2010, combined with increased
awareness of the dangers of vaccine-preventable diseases in general, has led to higher sales of this product group in recent years. Adacel®, the first trivalent adolescent and adult booster against diphtheria, tetanus and pertussis, was licensed and launched in the United States in 2005. Since 2004,
Adacel® has been the standard of care in Canada, where most provinces provide routine adolescent immunization.
This vaccine plays an important role in efforts to better control pertussis, by preventing the disease in adolescents and adults, and by breaking the cycle of transmission to infants too young to be immunized or only partially vaccinated. Adacel® is now registered in more than 50 countries.



Quadracel®, a quadrivalent booster vaccine (fifth dose) including diphtheria, tetanus, accelular pertussis and IPV is being
developed for the U.S. market. It will allow a child to complete the entire childhood series with the fewest doses possible. A Phase III clinical trial is scheduled to start during the first half of 2011.



Meningitis and pneumonia vaccines



Sanofi Pasteur is at the forefront of
the development of vaccines to prevent bacterial meningitis. In 2005, sanofi pasteur introduced Menactra®, the
first conjugate quadrivalent vaccine against meningococcal meningitis, arguably the deadliest form of meningitis in the world. In 2009, sales of Menactra® continued to grow in the United States following implementation of the recommendations of the Advisory Committee on Immunization Practices (ACIP) for routine
vaccination of pre-adolescents (11-12 years old), adolescents at high school entry (15 years old), and college freshmen living in dormitories. In October 2007, the FDA granted sanofi pasteur a license to expand the indication of Menactra® to children two years through 10 years of age. Menactra® is now indicated for people aged 2-55 years in the United States and in Canada. An Infant/Toddler (age 9/12 months) biological license application was submitted for
Menactra® for regulatory approval in the United States in 2010. This project is aimed at covering a lower age
group with a two-dose only schedule. Three pivotal clinical studies have been completed to support the 9-12 month indication. No safety concerns were identified and the vaccine was immunogenic for the four serotypes (A, C, Y, W-135). In 2010, sanofi
pasteur also launched Menactra® in the Middle East and Latin America.



Meningitis A, C, Y, W-135 conj. Second Generation  This
project targets a second generation meningococcal vaccine that uses an alternative conjugation technology. In 2009, an Investigational New Drug application was submitted to the FDA in order to conduct the Phase II clinical trial in the United
States. This trial started in December 2009, and enrollment was completed in 2010.



For over 30 years, sanofi pasteur has supplied vaccines for meningococcal meningitis serogroups A and C used to combat annual epidemics in Sub-Saharan countries (African meningitis belt).



Travel and Endemics Vaccines



Sanofi Pasteurs Travel/Endemics vaccines provide the
widest range of traveler vaccines in the industry, and include hepatitis A, typhoid, rabies, yellow fever, cholera, Japanese encephalitis, measles, mumps, rubella (MMR) and anti-venoms. These vaccines are used in endemics settings in the developing
world and are the basis for important partnerships with governments and organizations such as UNICEF. These vaccines are also used by the military and travelers to endemic areas. As the global leader in the majority of these vaccine markets, sanofi
pasteurs Travel/Endemics activity has demonstrated stable growth.



Japanese encephalitis is endemic in Southeast Asia. Replacement of the currently available vaccines with a single-dose product is expected to provide a strong competitive advantage and facilitate
expansion of vaccination programs. The Australian healthcare authorities granted approval of IMOJEV on August 16, 2010 for individuals aged 12 months and over. On October 29, 2010, the Thai Food and Drug Administration granted
licensure in the same age indication.



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The Vero serum-free improvement of our current Verorab® rabies vaccine (VRVg) would provide a worldwide, single rabies vaccine as a follow-up to our current rabies vaccine
offerings. Results from the 2009 Phase I clinical trial demonstrated non-inferiority of VRVg versus Verorab®. A
regulatory submission to AFSSAPS in France occurred in October 2010.



In December 2009, Shantha launched ShanCholTM, Indias first oral vaccine to protect against cholera in children and adults.



Animal Health: Merial



Our animal health activity is carried out through Merial, one of the worlds leading animal healthcare companies, dedicated to the
research, development, manufacture and delivery of innovative pharmaceuticals and vaccines used by veterinarians, farmers and pet owners (source: Vetnosis September 2010). Its net sales for 2010 amounted to 1,983 million (Merials sales
are not included in our consolidated net sales; for more information see Item 5  Results of Operations  Year Ended December 31, 2010 Compared with Year Ended December 31, 2009  Net Sales  Animal Health).



The animal health product
range comprises four major segments: parasiticides, anti-infectious drugs, other pharmaceutical products (such as anti-inflammatory agents, anti-ulcerous agents, etc.) and vaccines. Merials top-selling products include Frontline®, a topical anti-parasitic flea and tick brand for dogs and cats; Ivomec®, a parasiticide for the control of internal and external parasites in livestock; Heartgard®, a parasiticide for control of heartworm in companion animals; and Eprinex®, a parasiticide for use in cattle.



The compound patent protecting fipronil,
the active ingredient of Frontline®, expired in 2009 in Japan and in some European countries, including France,
Germany, Italy, and the United Kingdom, and in August 2010 in the United States. In those markets where the fipronil compound patent has expired, Frontline® products are generally still protected through formulation patents (directed to combinations) which expire at the latest in 2017 in Europe (August 2016 in the United
States). Frontline® is also protected by a method of use patent in the United States and the European Patent
area (Germany, France, Italy and the United Kingdom), expiring March 2018. As for human pharmaceutical products, patent protection for animal pharmaceutical products extends in most cases for 20 years from the filing date of the priority
application.



As regards regulatory exclusivity,
the position of veterinary medicinal products in Europe is similar to that of human pharmaceutical products: 8-year data exclusivity and 10-year market exclusivity. In the United States, there is 10-year data exclusivity for products approved by the
Environmental Protection Agency and an additional 5 years during which a generic applicant has to compensate the originator if it cites the originators data. For FDA approved veterinary medicinal products, a regulatory exclusivity period of 5
years is granted for a new chemical entity and 3 years for a previously-approved active ingredient. No data exclusivity exists at present for veterinary vaccines in the United States.



Merials major markets are the United States, France, Italy, the United Kingdom, Brazil, Australia, Japan,
Germany, Spain and Canada.



Merial operates
through a network of 16 production sites, with major sites located in France, the United States, Brazil and China. The major R&D sites are located in France and in the United States. Merial employs approximately 5,600 employees worldwide.



Pharmaceutical Research & Development



Since early 2009, we have been engaged in a wide-ranging
transformation program designed to overcome the challenges facing the pharmaceutical industry. Research and development (R&D) is the first priority of this program. Rapid developments in the scientific environment, which are bringing about a
veritable revolution in biopharmaceutical research, especially in biology, have generated profound and continuous change in the pharmaceutical environment. To anticipate the consequences of these changes and to maintain our innovative capacities, we
intend to have the most effective R&D organization in the pharmaceutical industry in place by 2013. The new R&D approach aims to foster greater creativity and innovation, while remaining fully focused on patient needs. Streamlined
organizational structures are designed to make R&D more flexible and entrepreneurial and hence better adapted to overcome future challenges.



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Organization



The resulting structure is focused on addressing patient
needs, and not on therapeutic indications per se.



The new R&D organization is composed of three different types of units:



| |  |  | Entrepreneurial Units: Divisions, Therapeutic Strategic Units (TSUs) and Distinct Project Units (DPUs), focused on patient needs and driving value in
collaboration with the external academic and biotech communities. Three global divisions have been created  Diabetes, Oncology and Ophthalmology  to further strengthen our position in these three areas. Five TSUs have been formed with a
focus on major pathophysiologies, pressing public health needs, or major geographic areas (Aging, Fibrosis & Wound Repair, Immuno-Inflammation, Infectious Diseases and Asia-Pacific). DPUs have been created to drive projects outside the
areas covered by the Divisions and TSUs. In addition, an exploratory unit will deliver early innovation, exploring and incubating new ideas, new technologies and new methodology.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Five scientific core platforms provide expert scientific support throughout the organization and operate as internal state-of-the-art service providers
to the Entrepreneurial Units.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Enabling and Support functions are being realigned to support the new structure and governance arrangements.
| | - |  | ------------------------------------------------------------------------------------------------------------



This new model will foster a strategy of openness with closer
cooperation between our researchers and external partners, and a more reactive and flexible organization that promotes the emergence of innovation and the grouping of researchers in stronger centers of expertise (oncology, diabetes, aging, etc.).
Implementation of this new structure is ongoing.



In line with this approach, a number of alliances and acquisitions were entered into during 2010 with companies including Ascenta,
Regulus, Metabolex and TargeGen. See Note D.1. and Note D.21.1. to our consolidated financial statements included at Item 18 of this annual report.



Portfolio



During 2010, R&D followed up the rigorous and comprehensive portfolio review initiated in 2009. Projects were assessed using seven key
criteria which allow management to rapidly understand how the portfolio performs in terms of innovation, unmet medical needs, risk and value. They can be summarized as follows:



| |  |  | science: level of innovation, level of safety, quality and reliability of the scientific data;
| | - |  | ----------------------------------------------------------------------------------------------



| |  |  | pharmacovigilance: assessment of the benefit/risk ratio for products (i.e., the clinical benefit versus the potential side effects).
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------



| |  |  | execution: likelihood of development and manufacturing success;
| | - |  | ---------------------------------------------------------------



| |  |  | market: existence of a market, positioning within this market, and our place in the market;
| | - |  | -------------------------------------------------------------------------------------------



| |  |  | reimbursement: likelihood of achieving the desired price and reimbursement based on the health authorities positioning and sanofi-aventis competencies;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | regulatory/legal: dealing with the environment around the project, patent status, regulatory guidelines; and
| | - |  | ------------------------------------------------------------------------------------------------------------



| |  |  | financial: predicted return on investment for the project.
| | - |  | ----------------------------------------------------------



A Portfolio Management & Reporting Group
provides permanent support to the new operating structures in management, reporting, and other processes. Complete R&D pipeline reviews will be conducted regularly.



At the end of 2010, the current clinical portfolio is the
result of decisions taken during these reviews, plus compounds entering the portfolio from the discovery phase or from third parties through acquisition, collaboration or alliances.



As described at Item 3. Key Information  D. Risk Factors  Risks Relating to Our Business
 We may fail to adequately renew our product portfolio whether through our own research and development or through acquisitions and strategic alliances. our product development efforts are subject to the risks and uncertainties inherent
in any new product development program.



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The clinical portfolio for new medical entities can be summarized as follows:



|                            |  |                                                                                        |  |                                      |  |                                                     
|--------------------------- |  | -------------------------------------------------------------------------------------- |  | ------------------------------------ |  | ----------------------------------------------------
|                            |  | Phase I                                                                                |  | Phase II                             |  | Phase III                                           
|Diabetes                    |  | SAR101099                                                                              |  | SAR260093 SAR236553                  |  | Lixisenatide                                        
|Oncology                    |  | SAR3419 SAR103168 SAR153192 SAR245409 (XL765) SAR302503 (TG101348)
SAR566658 SAR650984 |  | SAR245408 (XL147) SAR256212 (MM-121) |  | aflibercept ombrabulin (AVE8062) SAR240550 (BSI-201)
|Ophthalomlogy               |  | RetinoStat®                                                                            |  | FOV1101 FOV2302 FOV2304              |  |                                                     
|TSU Aging                   |  | SAR110894 SAR113945 SAR114137 SAR152954 SAR292833                                      |  |                                      |  |                                                     
|TSU Fibrosis & Wound Repair |  | SAR100842 SAR302532                                                                    |  |                                      |  |                                                     
|TSU Infectious Diseases     |  | SAR97276 SAR279356                                                                     |  | ferroquine                           |  |                                                     
|TSU Immuno-Inflammation     |  | SAR231893                                                                              |  | SAR153191                            |  |                                                     
|DPUs                        |  | SAR104772 SAR411298                                                                    |  | SSR125543 celivarone                 |  | semuloparin otamixaban teriflunomide                



Phase I studies are the first studies performed in humans, in healthy volunteers. Their main objective is to
assess the tolerability, the pharmacokinetic profile and where possible the pharmacodynamic profiles of the new drug.



Phase II studies are early controlled studies in a limited number of patients under closely monitored conditions to show efficacy and
short-term safety and to determine the dose and regimen for Phase III studies.



Phase III studies have the primary objective of demonstrating or confirming the therapeutic benefit and the safety of the new drug, in the intended indication and population. They are made to provide an
adequate basis for registration.



The Phase
II & III compounds are described in the section  Pharmaceutical Products  Main Pharmaceutical Products above. This section focuses on Phase I compounds entries, and lists projects that were terminated in 2010.



Diabetes/Other Metabolic Disorders portfolio



| |  |  | SAR101099, a Urotensin II Receptor Antagonist, entered Phase I. The product is being developed to reduce progression of diabetic nephropathy, a
severe complication of diabetes.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The novel regenerative compound SAR288223, also known as PancreateTM, is in the preclinical stage. This product is in-licensed from CureDM, and aims to stimulate growth of islet cells in
the pancreas, resulting in restoration of glucose control in the blood.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| |  |  | Lantus®
| | - |  | -------



The
Lantus® European marketing authorization was renewed in May 2010, and the Lantus® Pediatric Investigational Plan was adopted in September 2009.



| |  |  | The partnership with Wellstat for the development of a PKC epsilon inhibitor in the treatment of type 2 diabetes has been terminated.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------



Oncology portfolio



In June 2010, we announced that we had
signed an agreement to acquire TargeGen Inc., whose lead compound TG 101348 (SAR302503)is a potent inhibitor of Janus kinase 2 (JAK-2). It is an oral agent in Phase I/II and is being developed for the treatment of patients with
myeloproliferative diseases including myelofibrosis (MF) and Polycythemia Vera (PV).



Also in June 2010, we signed an exclusive global collaboration and licensing agreement with Ascenta Therapeutics for a number of compounds that could restore tumor cell apoptosis. These compounds inhibit
the p53-HDM2 (Human Double Minute 2) protein-protein interaction, leading potentially to reactivation of p53 tumor suppressor functions and thereby enhancing current cancer treatments.



In September 2010, sanofi-aventis and the Belfer Institute of Applied Cancer Science at the Dana-Farber
Cancer Institute (DFCI) announced that they had entered into a collaboration and license agreement to identify novel oncology targets for the development of new therapeutic agents directed at such targets and related biomarkers.



The following late phase projects were terminated:



| |  |  | The global development of alvocidibwas halted because the regulatory path proved longer than initially planned.
| | - |  | ---------------------------------------------------------------------------------------------------------------



| |  |  | The development oflarotaxel was terminated due to a lack of sufficient efficacy.
| | - |  | --------------------------------------------------------------------------------



Ophthalmology portfolio



A number of compounds for the treatment of eye disease were
added to the portfolio via the acquisition of Fovea and the collaboration agreement with Oxford BioMedica (see  Pharmaceutical Products  Main Pharmaceutical Products  Other Pharmaceutical Products above).



RetinoStat® (gene therapy) for the treatment of Age-related Macular Degeneration (AMD) entered Phase I in December.



TSU Aging portfolio



| |  |  | SAR110894 (H3 receptor antagonist for the treatment of Alzheimers dementia) completed its Phase I program and is expected to start Phase
II early 2011.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Three compounds progressed into clinical development (First In Man study)
| | - |  | -------------------------------------------------------------------------



| |  |  | SAR113945, an IKK-ß kinase inhibitor for the treatment of osteoarthritis (intra-articular administration);
| | - |  | ----------------------------------------------------------------------------------------------------------



| |  |  | SAR114137, a cathepsin S/K inhibitor for the treatment of osteoarthritis;
| | - |  | -------------------------------------------------------------------------



| |  |  | SAR152954, an H3 receptor antagonist.
| | - |  | -------------------------------------



| |  |  | GCR15300 (SAR292833), a first-in-class molecule for the treatment of chronic pain in-licensed from Glenmark, entered the portfolio in Phase I.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In December 2010, FDA put on hold all the clinical trials performed with anti-NGF drugs because of side effects occurring with products developed by
other companies. Consequently, the development of SAR164877 (REGN475), co-developed with Regeneron, is on clinical hold.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | A key collaboration agreement was signed with La Charite Hospital, Berlin, on stroke research.
| | - |  | ----------------------------------------------------------------------------------------------



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TSU Infectious Diseases portfolio



| |  |  | SAR279356 (first-in-class human monoclonal antibody for the prevention and treatment of S. aureus, S. epidermidis, E. coli, Y.
pestis and other serious infections)  The option to acquire a license from Alopexx for the development of SAR279356 was finalized in October 2010. The phase I study program has been completed successfully and Phase II is expected in the
first half of 2011.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | SAR97276is an antimalarial drug belonging to a new chemical class with an innovative mechanism of action, being developed for the treatment of
severe malaria. The optimal dosing schedule is currently being evaluated in children with uncomplicated malaria, prior to initiating the treatment of subjects with severe Plasmodium falciparum malaria.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Other Projects portfolio



| |  |  | The phase I program for SAR104772, an oral inhibitor of thrombin-activable fibrinolysis (TAFIa) for acute ischemic stroke, is ongoing.
Preclinical development of the corresponding intravenous formulation (SAR126119) has been initiated, and the Phase I program is expected to start in 2011.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The CHMP issued a positive opinion on Plavix® in addition to aspirin for patients with atrial fibrillation who are at increased risk of stroke and are not suitable for oral anticoagulant treatment. A dossier
is also under review in several other countries.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Pediatric development has been completed onclopidogrel. At a dose of 0.2 mg/kg  determined on the basis of similar pharmacodynamic
activity to clopidogrel 75 mg in adults  was not effective in neonates and infants with congenital heart disease palliated with a systemic to pulmonary artery shunt.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In Japanese patients receiving elective PCI, clopidogrel was shown to have a better safety profile than ticlopidine. A dossier for this
indication is in preparation for submission in Japan in 2011.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | A dossier was submitted for Uroxatral® based on the results of the pediatric development. While the results could not demonstrate the efficacy of alfusozin in patients with voiding disorders, all elements
of the pediatric written request were met, and exclusivity has been granted for Uroxatral® in the United
States thereby prolonging the product patent exclusivity until July 18, 2011.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Development of SSR411298  a fatty acid amide hydrolase (FAAH) inhibitor  in major depressive disorder in elderly patients was
discontinued, as the results of the Phase II dose finding study did not support progression to Phase III. Alternative development strategies are under evaluation based on analysis of the data.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Nerispirdine(K+ and Na+ Channel Blocker, symptomatic treatment for multiple sclerosis; Phase II) was terminated in symptomatic therapy for MS
because it failed to meet the endpoints of the Phase II dose ranging study, as reported in April 2010
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Other discovery/ development partnerships



| |  |  | A licensing agreement was signed in May with Glenmark Pharmaceuticals for the development and commercialization of new products in chronic pain
treatment. The first molecule included in this agreement entered the portfolio in Phase I (SAR292833 GRC15300) (see  TSU Aging portfolio above).
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | A global strategic alliance for the discovery, development and commercialization of microRNA therapeutics was signed with Regulus in June 2010. These
products are at the discovery stage.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Vaccines Research and Development



Our human vaccine research and development (R&D) remains focused on improving existing vaccines, as well as on the development of new
prophylactic vaccines.



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Portfolio



The sanofi pasteur R&D portfolio includes 15 vaccines
currently in advanced development as shown in the table below. The portfolio includes 6 vaccines for novel targets and 9 vaccines which are enhancements of existing vaccine products.



|                                                                                                                                                                                                                                                                               |  |                                                                                                                                                                                                                                                      |  |           |  |                                                                                                                                                                                           |  |                                                                                                                                                        
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------
|Phase I                                                                                                                                                                                                                                                                        |  | Phase IIa                                                                                                                                                                                                                                            |  | Phase IIb |  | Phase III                                                                                                                                                                                 |  | Submitted                                                                                                                                              
|Streptococcus pneumonia * Meningitis & pneumonia vaccine  Tuberculosis * Recombinant subunit vaccine
 Rotavirus (Shantha)
Live Attenuated Tetravalent Rotavirus oral vaccine 
Pseudomonas aeruginosa * Antibody
fragment product Prevention of ventilator-associated pneumonia |  | Rabies * mAb post exposure prophylaxis  Meningitis A,C,Y,W conj. 2ndgeneration
Meningococcal conjugate Infant vaccine 
Rabies VRVg Purified vero rabies
vaccine  DTP-HepB-Polio-Hib vaccine (1)  ACAM C. diff *
Clostridium difficile Toxoid vaccine |  |           |  | Hexaxim DTP-HepB-Polio-Hib vaccine(1)  Quadracel®
DTP(1)IPV vaccine 4-6 years U.S.  Dengue * Mild-to-severe dengue fever vaccine
 Fluzone® QIVQuadrivalent inactivated influenza vaccine |  | Menactra® Meningococcal conjugate vaccine for Infants/Toddlers at
9-12 months  Fluzone® ID
Seasonal influenza vaccine. intradermal micro-injection U.S.



|(1) | D=Diphtheria, T=Tetanus, Hib=Haemophilus influenzae b, HepB=Hepatitis B,
P=Pertussis.
|--- | -------------------------------------------------------------------------------------

|* | New targets
|- | -----------



Project highlights



This section focuses on Phase I compounds and novel targets.
Other vaccines in Phase II or III are described in the section  Vaccine Products above.



Influenza



To sustain our global leadership in the development of influenza vaccine, our R&D efforts are focused on innovative approaches for
assessing new formulations and alternative delivery systems (see  Vaccine Products).



Pediatric Combination & Adolescent/Adult Boosters



Several pediatric vaccines are under development. Tailored for specific markets, they are aimed at protecting
against five or all six of the following diseases: diphtheria, tetanus, pertussis, poliomyelitis (polio), Haemophilus influenzae type b infections and hepatitis B.



Meningitis



Neisseria meningitidesbacteria
is a leading cause of meningitis in the United States, Europe and elsewhere, affecting infants and children as well as adolescents. The primary focus of several ongoing projects related to Menactra® is to decrease the age at which this vaccine can first be administered. (see  Vaccine Products above).



Pneumococcal Vaccine



Streptococcus pneumoniae bacteria is the leading
etiological agent causing severe infections such as pneumonia, septicemia, meningitis and otitis media, and is responsible for over three million deaths per year worldwide, of which one million are children. Anti-microbial resistance in
Streptococcus pneumoniae has complicated the treatment of pneumococcal disease and further emphasized the need for vaccination to prevent large-scale morbidity and mortality.



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Sanofi Pasteur is focused on the development of a multi-protein-based pneumococcal vaccine.
This approach should result in a vaccine with superior serotype coverage as compared to current polysaccharide or conjugate based vaccines. The first Phase I clinical trial of a bivalent formulation was initiated in February 2010 and completed
enrollment in 2010. A second Phase I clinical trial to evaluate a third antigen was initiated in June 2010.



Rabies Vaccine



Rabies mAb Post Exposure Prophylaxis This product consists of two rabies monoclonal antibodies (MABs) that will be used in
association with the rabies vaccine for post-exposure prophylaxis. It is being developed in collaboration with Crucell. A Phase II clinical trial to evaluate safety and immunogenicity will be initiated in 2011.



New Vaccine Targets



Dengue Dengue fever has increasing
epidemiological importance due to global socio-climatic changes. It is a major medical and economic burden in the endemic areas of Asia-Pacific, Latin America and Africa. It is also one of the leading causes of fever among travelers. Multiple
approaches have been tested to develop a vaccine covering the four viral serotypes of dengue fever in order to prevent this disease and its severe complications (hemorrhagic fever). Results of a Phase II clinical trial in adults in the United States
demonstrated proof of concept of the lead vaccine candidate based on ChimeriVax technology. Sanofi Pasteurs dengue vaccine research program includes ongoing clinical studies (adults and children) in several countries in endemic regions.
The first Phase III study was initiated in October 2010 in Australia. This final stage of clinical development aims at demonstrating that production of the vaccine on an industrial scale will meet the consistency criteria required for market
authorizations. The study in Australia is the first to use our dengue vaccine doses produced on an industrial scale. Further Phase III studies to evaluate efficacy will begin in 2011.



Tuberculosis Statens Serum Institute of Denmark (SSI) has granted sanofi
pasteur a license to its technology with regard to the use of certain fusion proteins in the development of a tuberculosis vaccine. The license from SSI includes access to the Intercell IC31® adjuvant. The candidate vaccine is made up of recombinant protein units. Results from the 2008 Phase I trial found that the H4/IC31 tuberculosis vaccine candidate was
safe when administered to healthy adults living in a region of high endemic tuberculosis. Rapid antigen-specific T cell responses were induced following a single dose of the investigational vaccine. A second Phase I trial was initiated in
Switzerland in December 2010.



HIV
The Phase III clinical trial in Thailand completed in 2009 provided the first concrete evidence since the discovery of the HIV virus in 1983 that a vaccine against HIV is potentially feasible. Additional work is required to develop and test a
vaccine suitable for approval and worldwide use. During 2010, the Thai study partnership (the U.S. Army, the National Institute of Allergy and Infectious Diseases of the National Institutes of Health (NIH), the Ministry of Public Health of Thailand,
and sanofi pasteur) continued to work together in monitoring patients infected with HIV in the Phase III trial, evaluating existing clinical samples using state-of-the-art immunological tools, and designing future studies. Sanofi Pasteur has also
initiated discussions with potential industrial partners to substantiate and extend the vector prime/protein subunit boost regimen used in the Phase III trial. Public-private partnerships will be evaluated as a source of funding for future clinical
trials and product development.



ACAM-Cdiff
 Clostridium difficile is a major public health concern in North America and Europe. In hospitals, it is the leading cause of infectious diarrhea in adults, particularly the elderly. The epidemiology of Clostridium difficile
associated disease (CDAD) has been increasing at an alarming rate since 2003, driven primarily by the emergence of a treatment-resistant, highly virulent strain CD027. There is currently no vaccine available and the only vaccine candidate currently
in development is ACAM-Cdiff. ACAM-Cdiff is a toxoid-based vaccine. Toxoids have been used as the basis of a number of highly successful licensed vaccines. This vaccine candidate has successfully completed Phase I clinical trials with more than 200
participants in which safety and immunogenicity were evaluated. Sanofi Pasteur received a positive response from the United States. FDAs Center for Biologics Evaluation & Research (CBER) on the Fast Track Development Program
submission in 2010. In November 2010, our Clostridium difficilevaccine started Phase II of clinical study in the U.S. This



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trial is focused on evaluating prevention of the first episode of Clostridium difficile infection (CDI) in at-risk individuals, which includes adults with imminent hospitalization or
current or impending residence in a long-term care or rehabilitation facility.



Pseudomonas aeruginosa In February 2010, sanofi pasteur entered into an agreement with KaloBios Pharmaceuticals, a U.S.-based, privately held biotech company, for the development of a
Humaneered antibody fragment to both treat and prevent Pseudomonas aeruginosa (Pa) infections. Most serious Pa infections occur in hospitalized and critically or chronically ill patients  primarily affecting the respiratory
system in susceptible individuals  and are a serious clinical problem due to their resistance to antibiotics. The two primary target indications for the antibody are prevention of Pa associated pneumonia in mechanically ventilated
patients in hospitals, and prevention of relapses and potential improvement of treatment outcomes in patients with an ongoing Pa infection. Under the terms of the agreement, sanofi pasteur acquired worldwide rights for all disease indications
related to Pa infections except cystic fibrosis and bronchiectasis, which sanofi pasteur has the option to obtain at a later date. KaloBios has already completed phase I clinical trials  one in healthy volunteers and one in cystic
fibrosis patients  and a small proof of concept phase II clinical trial in mechanically ventilated patients.



Rotavirus Rotavirus is the leading cause of severe, dehydrating diarrhea in children aged under five
globally. Estimates suggest that rotavirus causes over 25 million outpatient visits, over 2 million hospitalizations and over 500,000 deaths per year. The burden of severe rotavirus illness and deaths falls heavily upon children in the
poorer countries of the world, with more than 80% of rotavirus-related deaths estimated to occur in lower income countries of Asia, and in sub-Saharan Africa. Two vaccines (RotaTeq® and Rotarix®) are licensed
worldwide, but production of local vaccines is necessary to achieve wide coverage. Shantha has a non-exclusive license of rotavirus strains from NIH and is developing a live-attenuated human bovine (G1-G4) reassortant vaccine. The license excludes
Europe, Canada, United States, China and Brazil. The project is currently in phase I.



Patents, Intellectual Property and Other Rights



Patent Protection



We own a broad portfolio of patents, patent applications and patent licenses worldwide. These patents are of various types and may cover:



| |  |  | active ingredients;
| | - |  | -------------------



| |  |  | pharmaceutical formulations;
| | - |  | ----------------------------



| |  |  | product manufacturing processes;
| | - |  | --------------------------------



| |  |  | intermediate chemical compounds;
| | - |  | --------------------------------



| |  |  | therapeutic indications/methods of use;
| | - |  | ---------------------------------------



| |  |  | delivery systems; and
| | - |  | ---------------------



| |  |  | enabling technologies, such as assays.
| | - |  | --------------------------------------



Patent protection for individual products typically extends for 20 years from the patent filing date in countries where we seek patent
protection. A substantial part of the 20-year life span of a patent on a new chemical entity has generally already passed by the time the related product obtains marketing approval. As a result, the effective period of patent protection for an
approved products active ingredient is significantly shorter than 20 years. In some cases, the period of effective protection may be extended by procedures established to compensate significant regulatory delay in Europe (a Supplementary
Protection Certificate or SPC), the United States (a Patent Term Extension or PTE) and Japan (also a PTE).



The product may additionally benefit from the protection of patents obtained during development or after the products initial
marketing approval. The protection a patent affords the related product depends upon the type of patent and its scope of coverage, and may also vary from country to country. In Europe for instance, applications for new patents may be submitted to
the European Patent Office (EPO), an intergovernmental organization which centralizes filing and prosecution. As of December 2010, an EPO patent application may



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cover the 38 European Patent Convention member states, including all 27 member states of the European Union. The granted European Patent establishes corresponding national patents
with uniform patent claims among the member states. However, some older patents were not approved through this centralized process, resulting in patents having claim terms for the same invention that differ by country. Additionally, a number of
patents prosecuted through the EPO may pre-date the European Patent Convention accession of some current European Patent Convention member states, resulting in different treatment in those countries.



We monitor our competitors and vigorously seek to challenge
patent infringement when such challenges would negatively impact our business objectives. See Note D.22.b) to the consolidated financial statements included in Item 18 of this annual report.



The expiration or loss of an active ingredient patent may
result in significant competition from generic products and can result in a dramatic reduction in sales of the original branded product. See Item 3. Key Information  D. Risk Factors  Risks Relating to Legal Matters  Generic
versions of some of our products may be approved for sale in one or more of their major markets. In some cases, it is possible to continue to obtain commercial benefits from product manufacturing trade secrets or from other types of patents,
such as patents on processes, intermediates, structure, formulations, methods of treatment, indications or delivery systems. Certain categories of products, such as traditional vaccines and insulin, have been historically relatively less reliant on
patent protection and may in many cases have no patent coverage, although it is increasingly frequent for novel vaccines and insulins to be patent protected. See  Focus on Biologics below. Patent protection is an important
factor in our animal health business, but is of comparatively lesser importance to our Consumer Health Care and generics businesses, which rely principally on trademark protection.



Regulatory Exclusivity



In some markets, including the European Union and the United
States, many of our products may also benefit from multi-year regulatory exclusivity periods, during which a generic competitor may not rely upon our clinical trial and safety data in its drug application. Exclusivity is meant to encourage
investment in research and development by providing innovators the exclusive use for a limited time, of the innovation represented by a newly approved drug product. This exclusivity operates independently of patent protection and may protect the
product from generic competition even if there is no patent covering the product.



In the United States, the FDA will not grant final marketing approval to a generic competitor for a New Chemical Entity (NCE) until the expiration of the regulatory exclusivity period (generally five
years) that commences upon the first marketing authorization of the reference product. The FDA will accept the filing of an Abbreviated New Drug Application (ANDA) containing a patent challenge one year before the end of this regulatory exclusivity
period (see the descriptions of ANDAs in  Product Overview  Challenges to Patented Products below). In addition to the regulatory exclusivity granted to NCEs, significant line extensions of existing NCEs may qualify for an
additional three years of regulatory exclusivity. Also, under certain limited conditions, it is possible to extend unexpired U.S. regulatory and patent-related exclusivities by a pediatric extension. See  Pediatric Extension,
below.



In the European Union, regulatory
exclusivity is available in two forms: data exclusivity and marketing exclusivity. Generic drug applications will not be accepted for review until eight years after the first marketing authorization (data exclusivity). This eight-year period is
followed by a two-year period during which generics cannot be marketed (marketing exclusivity). The marketing exclusivity period can be extended to three years if, during the first eight-year period, the marketing authorization holder obtains an
authorization for one or more new therapeutic indications which are deemed to provide a significant clinical benefit over existing therapies. This is known as the 8+2+1 rule.



While these exclusivities are intended to be applicable throughout the European Union, in a decentralized
system, national authorities may act in ways that are inconsistent with EU regulatory exclusivity. For example, although European marketing exclusivity for clopidogrel expired in July 2008, in May 2008 the German Health authority BfArM had already
registered a competitors clopidogrel product based on a contested interpretation of the law. Furthermore, in 2006, the Polish and Bulgarian authorities registered generics of clopidogrel bisulfate based on these countries contested
position that EU marketing exclusivities need not be applied by individual countries where generics had been approved prior to their accession date.



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In Japan, the regulatory exclusivity period varies from four years (for medicinal products
with new indications, formulations, dosages, or compositions with related prescriptions) to six years (for new drugs containing a medicinal composition, or requiring a new route of administration) to eight years (for drugs containing a new chemical
entity) to ten years (for orphan drugs or new drugs requiring pharmaco-epidemiological study).



Emerging Markets



One of the main limitations on our operations in emerging market countries is the lack of effective intellectual property protection or enforcement for our products. The World Trade Organization (WTO)
Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIP) has required developing countries to amend their intellectual property laws to provide patent protection for pharmaceutical products since January 1, 2005 although it
provides a limited number of developing countries an extension to 2016. Additionally, these same countries frequently do not provide non-patent exclusivity for innovative products. While the situation has gradually improved, the lack of protection
for intellectual property rights or the lack of robust enforcement of intellectual property rights poses difficulties in certain countries. Additionally, in recent years a number of countries faced with health crises have waived or threatened to
waive intellectual property protection for specific products, for example through compulsory licensing. See Item 3. Key Information  D. Risk Factors  Risks Relating to Our Business  The globalization of the Groups
business exposes us to increased risks.



Pediatric Extension



In the United States and Europe, under certain conditions, it is possible to extend a products regulatory exclusivities for an
additional period of time by providing data regarding pediatric studies.



In the United States, the FDA may ask a company for pediatric studies if it has determined that information related to the use of the drugs in the pediatric population may produce health benefits. The FDA
has invited us by written request to provide additional pediatric data on several of our main products. Under the Hatch-Waxman Act, timely provision of data meeting the FDAs requirements (regardless of whether the data supports a pediatric
indication) may result in the FDA extending regulatory exclusivity and patent life by six months, to the extent these protections have not already expired (the so-called pediatric exclusivity). The main products having received past FDA
grants of pediatric exclusivity are Aprovel®, Lantus®, Allegra®, Ambien®/Ambien® CR, Plavix® and Taxotere®.



In Europe, a regulation on pediatric medicines came into force on January 26, 2007. This regulation was implemented in 2009, and
provides for pediatric research obligations with potential associated rewards including extension of patent protection (for patented medicinal products) and regulatory exclusivity for pediatric marketing authorization (for off-patent medicinal
products). For additional details, see  Regulation below.



Japanese regulations do not currently offer the possibility of similar extensions in exchange for pediatric study results.



Product Overview



We summarize below the intellectual property coverage in our
major markets of the marketed products described above at  Pharmaceutical Products  Main Pharmaceutical Products. Concerning animal health products, Merials intellectual property coverage is described above (see
 Animal Health: Merial). In the discussion of patents below, we focus on active ingredient patents (compound patents) and any later filed improvement patents listed in the FDAs list of Approved Drug Products with Therapeutic
Equivalence Evaluations (the Orange Book) or on their foreign equivalents, because these patents tend to be the most relevant in the event of an application by a competitor to produce a generic version of one of our products or the
equivalent of these patents in other countries (see  Challenges to Patented Products below). In some cases, products may also benefit from pending patent applications and from patents not eligible for Orange Book listing
(e.g., patents claiming industrial processes). In each case below, we specify whether the active ingredient is claimed by an unexpired patent. Where patent terms have been extended to compensate for regulatory delay, the extended dates are
presented below. U.S. patent expirations presented below reflect U.S. Patent and Trademark Office dates, and therefore do not reflect six-month pediatric extensions to the FDAs Orange Book dates for the



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products concerned (Aprovel®, Lantus®, Stilnox®/Ambien® CR, Allegra®, Plavix® and Taxotere®). A footnote
indicates those cases where the FDAs Orange Book reflects a pediatric exclusivity extended 6 months beyond the United States Patent and Trademarks Office (U.S. PTO) patent expiration date.



We do not provide later filed improvement patent information
relating to formulations already available as an unlicensed generic. References below to patent protection in Europe indicate the existence of relevant patents in most major markets in the European Union. Specific situations may vary country by
country, most notably with respect to older patents and to countries having only recently joined the European Union.



We additionally set out any regulatory exclusivity from which these products continue to benefit in the United States, European Union or
Japan. Regulatory exclusivities presented below incorporate any pediatric extensions obtained. While EU regulatory exclusivity is intended to be applied throughout the European Union, in some cases member states have taken positions prejudicial to
our exclusivity rights. See  Regulatory Exclusivity above.



|                           |  |                                                                                                  |  |                                                              
|-------------------------- |  | ------------------------------------------------------------------------------------------------ |  | -------------------------------------------------------------
|Lantus® (insulin
glargine)
|U.S.                       |  | E.U.                                                                                             |  | Japan                                                        
|Compound: August 20141     |  | Compound: November 2014 in most of the EU; no compound patent in force in much of Eastern Europe |  | Compound: November 2014 
Regulatory exclusivity: October 2011



|                                                                         |  |                                            |  |                                                                                          
|------------------------------------------------------------------------ |  | ------------------------------------------ |  | -----------------------------------------------------------------------------------------
|Apidra® (insulin
glulisine)                                             
|U.S.                                                                     |  | E.U.                                       |  | Japan                                                                                    
|Compound: June 2018                                                      |  | Compound: September 2019 in most of the EU |  | Compound: May 2022                                                                       
|Later filed improvement patents: formulation
March 2022 and January 2023 |  | Regulatory exclusivity: September 2014     |  | Later filed improvement patent: formulation July
2022  Regulatory exclusivity: April
2017



|                                             |  |                                                                                         |  |                                                                           
|-------------------------------------------- |  | --------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------
|Taxotere®
(docetaxel)                       
|U.S.                                         |  | E.U.                                                                                    |  | Japan                                                                     
|Compound: expired in May 20102               |  | Compound: expired in November 2010 in most of the EU                                    |  | Compound: June 2012                                                       
|No generic products presently on the
market. |  | Later filed improvement patents: additional patent coverage
(2012 to 2013)  Genericized |  | Later filed improvement patents: formulation running
through November 2013



|                                                                       |  |                   |  |      
|---------------------------------------------------------------------- |  | ----------------- |  | -----
|Eloxatine®
(oxaliplatin)3                                             
|U.S.                                                                   |  | E.U.              |  | Japan
|Compound: expired                                                      |  | Compound: expired |  | N/A  
|                                                                       |  |                  
|Later filed improvement patents: coverage ranging through August 20164 |  | Genericized       |  |      



|1 | pediatric exclusivity until February 2015.
|- | ------------------------------------------

|2 | pediatric exclusivity until November 2010.
|- | ------------------------------------------

|3 | We do not own most Eloxatine® patents but license them from Debiopharm for marketing.
|- | -------------------------------------------------------------------------------------

|4 | Was
genericized in 2010 until settlement of litigation. Is not currently genericized and may or may not retain exclusivity until August 9, 2012, depending on outcome of settlement dispute presently in court.
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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|                                                               |  |                                                                                                  |  |                                                                                                
|-------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------ |  | -----------------------------------------------------------------------------------------------
|Jevtana®
(cabazitaxel)                                        
|U.S.                                                           |  | E.U.                                                                                             |  | Japan                                                                                          
|Compound: March 2016 (up to 2021 if PTE is granted)            |  | Compound: March 2016 (patent term extension to be determined once product is approved in Europe) |  | Compound: March 2016 (patent term extension to be determined once product is approved in Japan)
|Later filed improvement patents: coverage ranging through 2025 |  |                                                                                                  |  |                                                                                                
|                                                               |  |                                                                                                 
|Regulatory exclusivity: June 2015                              |  |                                                                                                  |  |                                                                                                



|                                                  |  |                                                                                                                                                                                                                                                        |  |                                                                                
|------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | -------------------------------------------------------------------------------
|Lovenox®
(enoxaparin sodium)                     
|U.S.                                              |  | E.U.                                                                                                                                                                                                                                                   |  | Japan                                                                          
|Compound: no compound patent coverage Genericized |  | Compound: June 2011 in part of the EU; exceptions: no compound patent in force in France, Germany, Spain, Portugal, Finland, Norway, Greece and much of Eastern Europe                                                                                 |  | Compound: expired 
Regulatory exclusivity: 2016                                
|                                                 
|Plavix®
(clopidogrel bisulfate)                  
|U.S.                                              |  | E.U.                                                                                                                                                                                                                                                   |  | Japan                                                                          
|Compound: November 20111                          |  | Genericized (other clopidogrel salts)                                                                                                                                                                                                                  |  | Compound: 2013                                                                 
|                                                  |  |                                                                                                                                                                                                                                                        |  | Regulatory exclusivity: 2014                                                   
|                                                 
|Aprovel®
(irbesartan)                            
|U.S.                                              |  | E.U.                                                                                                                                                                                                                                                   |  | Japan                                                                          
|Compound: September 20112                         |  | Compound: August 2012 in most of the EU; exceptions: expires March 2011 in the Czech Republic, Hungary, Romania, Slovakia and 2013 in Lithuania and Latvia. No compound patent in
force in Spain, Portugal, Finland, Norway and much of Eastern Europe |  | Compound: 2016                                                                 
|                                                  |  |                                                                                                                                                                                                                                                       
|                                                  |  |                                                                                                                                                                                                                                                        |  |                                                                                
|                                                  |  | Later filed improvement patents: formulation coverage ranging through 2016  Generics on the market in some EU countries                                                                                                                                |  | Later filed improvement patent: formulation (2021) Regulatory exclusivity: 2016
|                                                 
|Tritace® (ramipril)                              
|U.S.                                              |  | E.U.                                                                                                                                                                                                                                                   |  | Japan                                                                          
|N/A                                               |  | Compound: expired                                                                                                                                                                                                                                      |  | Compound: expired                                                              
|                                                  |  |                                                                                                                                                                                                                                                       
|                                                  |  | Genericized                                                                                                                                                                                                                                            |  |                                                                                



|1 | pediatric exclusivity until May 2012.
|- | -------------------------------------

|2 | pediatric exclusivity until March 2012.
|- | ---------------------------------------



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|                                                                                                                                             |  |                                                                                                                              |  |                      
|-------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------------------------------------------------------------------------------------------- |  | ---------------------
|Multaq®
(dronedarone hydrochloride)                                                                                                         
|U.S.                                                                                                                                         |  | E.U.                                                                                                                         |  | Japan                
|Compound: July 2011 (2016 if
PTE petition is granted)  Later filed improvement patent:
formulation (2018)  Regulatory exclusivity: July
2014 |  | Compound: August 2011 
Later filed improvement patent: formulation (2018; 2023 if SPC granted)
 Regulatory exclusivity: 2019 |  | Compound: August 2011



|                                                                         |  |                                                                            |  |                                                                                                                     
|------------------------------------------------------------------------ |  | -------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------
|Stilnox® (zolpidem
tartrate)                                            
|U.S.                                                                     |  | E.U.                                                                       |  | Japan                                                                                                               
|Compound patent: expired                                                 |  | Compound patent: expired                                                   |  | Compound patent: expired                                                                                            
|                                                                         |  |                                                                           
|Later filed improvement patent; Ambien® CR
formulation (2019)            |  |                                                                            |  |                                                                                                                     
|                                                                         |  |                                                                           
|Genericized                                                              |  | Genericized                                                                |  | Regulatory exclusivity: expired. 
Later filed improvement patent: Ambien® CR formulation (2019); not commercialized.
|                                                                        
|Copaxone®
(glatiramer acetate)1                                         
|U.S.                                                                     |  | E.U.                                                                       |  | Japan                                                                                                               
|N/A                                                                      |  | Compound: 2015                                                             |  | N/A                                                                                                                 
|                                                                        
|Depakine® (sodium
valproate)                                            
|U.S.                                                                     |  | E.U.                                                                       |  | Japan                                                                                                               
|N/A                                                                      |  | Compound: expired                                                          |  | Compound: expired                                                                                                   
|                                                                         |  |                                                                           
|                                                                         |  | Later filed improvement patent: Depakine®
Chronosphere® formulation (2017) |  | Later filed improvement patent: Depakine®
Chronosphere® formulation (2017)                                          
|                                                                        
|Allegra®
(fexofenadine hydrochloride)                                   
|U.S.                                                                     |  | E.U.                                                                       |  | Japan                                                                                                               
|Compound: expired                                                        |  | Compound: expired                                                          |  | Compound: expired                                                                                                   
|                                                                         |  |                                                                           
|Converted to Over-the-Counter                                            |  | Genericized                                                                |  | Later filed improvement patents: coverage ranging through 2016                                                      
|                                                                        
|Nasacort®
(triamcinolone acetonide) 2                                   
|U.S.                                                                     |  | E.U.                                                                       |  | Japan                                                                                                               
|Compound: expired                                                        |  | Compound: expired                                                          |  | Compound: expired                                                                                                   
|                                                                         |  |                                                                           
|Later filed improvement patents: formulation and method of use July 2016 |  | Later filed improvement patent: formulation 2017                           |  |                                                                                                                     
|Generic licensed as early as 20112                                       |  |                                                                            |  |                                                                                                                     



|1. | Sanofi-aventis has licensed Copaxone®from Teva, with which
we co-promote the product.
|-- | -------------------------------------------------------------------------------------

|2. | A license was granted to Barr Laboratories, Inc. in settlement of patent litigation.
|-- | ------------------------------------------------------------------------------------



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|                                  |  |                   |  |                  
|--------------------------------- |  | ----------------- |  | -----------------
|Xatral® (alfuzosin
hydrochloride)
|U.S.                              |  | E.U.              |  | Japan            
|Compound: expired3                |  | Compound: expired |  | Compound: expired
|                                  |  |                  
|Genericized                       |  | Genericized       |  | Genericized      



|                                                                    |  |                                                                                                                                                                           |  |      
|------------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -----
|Actonel®
(risedronate sodium)4                                     
|U.S.                                                                |  | E.U.                                                                                                                                                                      |  | Japan
|Compound: December 2013                                             |  | Compound: expired in December 2010 in Austria, Belgium, France, Germany, the Netherlands, the United Kingdom, Sweden, Switzerland and Italy; previously expired elsewhere |  | N/A  
|                                                                    |  |                                                                                                                                                                          
|Later filed improvement patents: coverage ranging through June 2018 |  | Later filed improvement patents: coverage ranging through 2018                                                                                                            |  |      



|3. | Pediatric exclusivity for Uroxatral® until July 2011.
|-- | -----------------------------------------------------

|4. | On October 30, 2009, Procter & Gamble Pharmaceuticals (P&G)
sold its pharmaceutical business to Warner Chilcott (WCRX) which became the successor to P&G in rights and interests for the Actonel® alliance and now holds the NDA
and the patents for this product in the United States. We commercialize Actonel® with WCRX.
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Patents held or licensed by the Group do
not in all cases provide effective protection against a competitors generic version of our products. For example, notwithstanding the patents listed above competitors have launched generic versions of Eloxatine® in Europe and in the United States, Allegra® in the United States (prior to the product being switched to over-the-counter status) and Plavix® in Europe.



We caution the reader that there can be no assurance that we will prevail when we assert a patent in litigation and that there may be instances in which the Group determines that it does not have a
sufficient basis to assert one or more of the patents mentioned in this report, for example in cases where a competitor proposes a formulation not appearing to fall within the claims of our formulation patent, a salt or crystalline form not claimed
by our composition of matter patent, or an indication not covered by our method of use patent. See Item 3. Key Information  D. Risk Factors  Risks Relating to Legal Matters  Generic versions of some of our products may
be approved for sale in one or more of their major markets.



As disclosed in Note D.22.b) to our consolidated financial statements included at Item 18 of this annual report, we are involved in significant litigation concerning the patent protection of a number
of products.



Challenges to Patented Products



In the United States, companies have filed
Abbreviated New Drug Applications (ANDAs), containing challenges to patents related to a number of our products. An ANDA is an application by a drug manufacturer to receive authority to market a generic version of another companys approved
product, by demonstrating that the purportedly generic version has the same properties as the original approved product. ANDAs may not be filed with respect to drugs licensed as a biological. See  Focus on Biologics below. An ANDA
relies on the safety and other technical data of the original approved product, and does not generally require the generic manufacturer to conduct clinical trials (thus the name abbreviated new drug application), presenting a significant
benefit in terms of time and cost. As a result of regulatory protection of our safety and other technical data, the ANDA may generally be filed only five years following the initial U.S. marketing authorization of the original product.
See  Regulatory Exclusivity above. This period can be reduced to four years if the ANDA includes a challenge to a patent listed in the FDAs Orange Book. However, in such a case if the patent holder or licensee brings
suit in response to the patent challenge within the statutory window, then the FDA is barred from granting final approval to an ANDA during the 30 months following the patent challenge (this bar being referred to in our industry as a 30-month
stay), unless, before the end of the 30 months, a court decision or settlement has determined either that the ANDA does not infringe the listed patent or that the listed patent is invalid and/or unenforceable.



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FDA approval of an ANDA after this 30-month period does not resolve outstanding patent
disputes, but it does remove the regulatory impediments to a product launch by a generic manufacturer willing to take the risk of later being ordered to pay damages to the patent holder.



Procedures comparable to the ANDA exist in other major markets.



In the European Union, a generic drug manufacturer may only
reference the data of the regulatory file for the original approved product after data exclusivity has expired. However, there is no patent listing system in Europe comparable to the Orange Book, which would allow the patent holder to prevent the
competent authorities from granting marketing approval by bringing patent infringement litigation prior to approval. As a result, generic products may be approved for marketing following the expiration of marketing exclusivity without regard to the
patent holders rights. Nevertheless, in most of these jurisdictions once the competing product is launched and in some jurisdictions, even prior to launch (once launch is imminent), the patent holder can seek an injunction against such
marketing if it believes its patents are infringed. See Note D.22.b) to our consolidated financial statements included at Item 18 of this annual report.



The accelerated ANDA-type procedures are potentially applicable to most, but not all, of the products we manufacture. See 
Focus on Biologics and  Regulation below. We seek to defend our patent rights vigorously in these cases. Success or failure in the assertion of a given patent against one competing product is not necessarily predictive of the
future success or failure in the assertion of the same patent - or a fortiori the corresponding foreign patent - against a second competing product due to factors such as possible differences in the formulations of the competing
products, intervening developments in law or jurisprudence, local variations in the patents and differences in national patent law and legal systems. See Item 3. Key Information  D. Risk Factors  Risks Relating to Legal Matters
 Generic versions of our products may be approved for sale in one or more of their major markets.



Trademarks



Our products are sold around the world under trademarks that we consider to be of material importance in the aggregate. Our trademarks help to maintain the identity of our products and services, and
protect the sustainability of our growth. It is our policy to register our trademarks with a strategy adapted to each product or service depending on their countries of commercialization: i.e., on a worldwide basis for worldwide products or
services, or on a regional or local basis for regional or local products or services.



Our trademarks are monitored and defended based on this policy and in order to prevent infringement and/ or unfair competition.



Our trademarks contribute to the identity of our products and
services, and help support their development.



The
degree of trademark protection varies country by country, as each state applies its own trademark laws to trademarks used in its territory. In most countries, trademark rights may only be obtained by registration. In some countries, trademark
protection is primarily based on use. Registrations are granted for a fixed term (in most cases ten years) and are renewable indefinitely, but in some instances may be subject to the continued use of the trademark.



When trademark protection is based on use, it covers the
products and services for which the trademark is used. When trademark protection is based on registration, it covers only the products and services designated in the registration. Additionally, in certain cases, we may enter into a coexistence
agreement with a third-party that owns potentially conflicting rights in order to better protect and defend our trademarks.



Production and Raw Materials



Our principal manufacturing processes consist of three stages: the manufacture of active ingredients, the incorporation of those
ingredients into products, and packaging.



We
generally develop and manufacture the active ingredients that we use in our products. We have a general policy of producing the active ingredients for our principal products at our own plants in order to minimize our



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dependence on external manufacturers and control the product throughout the production cycle. In some cases however, we have outsourced certain production elements, especially as part of supply
agreements entered into within the framework of plant divestitures, or in order to adapt to market growth in emerging markets. As a result, we outsource a portion of the production of the active ingredients used in Stilnox® and Xatral®, and certain formulations of various pharmaceutical products. Our main subcontractors are Famar, Haupt, Patheon, Catalent and Sofarimex. These subcontractors are
required to follow our guidelines in terms of quality, logistics and other criteria. See Item 3. Key Information  D. Risk Factors  Risks Relating to Our Business  The manufacture of our products is technically complex, and
supply interruptions, product recalls or inventory losses caused by unforeseen events may reduce sales, delay the launch of new products and adversely affect our operating results and financial condition.



Among our other key products, we also
depend on third parties in connection with the manufacture of Eloxatine®. Under the terms of our license
agreement with Debiopharm, we purchase the active ingredient from Debiopharm, and the production of the finished lyophilized product is outsourced to two manufacturers. The manufacturing of the liquid form of Eloxatine® is conducted at our facility in Dagenham (United Kingdom).



Under our partnership with BMS, a multi-sourcing organization and security stock are in
place for Plavix®/clopidogrel bisulfate and
Aprovel® / irbesartan.



We purchase the raw materials used to
produce Lovenox® from a number of sources.



Our main European pharmaceutical production facilities are
located in France, Germany, Italy, Spain, the United Kingdom and Hungary. In North America, we run two facilities in the United States (Kansas City and Saint Louis), supplemented recently with the acquisition of Chattem (Tennessee), and one in
Canada (Laval). We have one plant in Japan (Kawagoe) and additional facilities located in many other parts of the world. To carry out the production of vaccines, sanofi pasteur uses a wide industrial operations network, with sites located in North
America, France, China, Thailand, Argentina and India. A new antigen production unit in Mexico for seasonal and pandemic influenza vaccines is expected to commence commercial production in 2012, once the necessary production and marketing approvals
have been obtained from Mexican officials.



All of our pharmaceutical and vaccine facilities are Good Manufacturing Practices (GMP) compliant in accordance with international guidelines. Our main facilities are also FDA approved, including our
pharmaceutical facilities in Ambarès, Tours, Le Trait, Maisons-Alfort and Compiègne in France, Dagenham and Holmes Chapel in the United Kingdom, Frankfurt in Germany, Veresegyhaz in Hungary, Saint Louis in the United States and Laval
in Canada, our vaccines facilities at Marcy lEtoile and Val de Reuil (hosting a distribution center) in France, Swiftwater in the United States and Toronto in Canada. Wherever possible we seek to have multiple plants approved for the
production of key active ingredients and finished products, as in the case of Lovenox® for example.



In February 2011, we received an FDA warning letter
concerning part of our Frankfurt facility following a routine FDA inspection in September 2010. The warning letter cites CGMP compliance issues in certain manufacturing processes, without referring to specific products. While we take the warning
seriously and are working to address the remaining recommendations, we are also confident that none of the issues raised in the letter compromise the quality of our marketed products or our ability to continue to supply the markets with all
products.



More details about our manufacturing
sites are set forth below at  D. Property, Plant and Equipment.



Health, Safety and Environment (HSE)



The manufacturing and research operations of sanofi-aventis are subject to increasingly stringent health, safety and environmental laws and regulations. These laws and regulations are complex and rapidly
changing, and sanofi-aventis invests the necessary sums in order to comply with them. This investment, which aims to respect health, safety and the environment, varies from year to year and totaled approximately 113 million in 2010.



The applicable environmental laws and regulations
may require sanofi-aventis to eradicate or reduce the effects of chemical substance usage and release at its various sites. The sites in question may belong to the



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Group, be currently operational, or they may have been owned or operational in the past. Under some of these laws and regulations, a current or previous owner or operator of a property may be
held liable for the costs of removal or remediation of hazardous substances on, under or in its property, or transported from its property to third party sites, without regard to whether the owner or operator knew of, or under certain circumstances
caused the presence of the contaminants, or at the time site operations occurred, the discharge of those substances was authorized.



Moreover, as for a number of companies involved in the pharmaceutical, chemical and agrochemical industries, soil and groundwater
contamination has occurred at some Group sites in the past, and may still occur or be discovered at others. In the Groups case, such sites are mainly located in the United States, Germany, France, Hungary, the Czech Republic, Slovakia, Brazil,
Italy and the United Kingdom. As part of a program of environmental audits conducted over the last few years, detailed assessments of the risk of soil and groundwater contamination have been carried out at current and former Group sites. In
cooperation with national and local authorities, the Group constantly assesses the rehabilitation work required and this work has been implemented when appropriate. Long-term rehabilitation work is in progress or planed in Rochester, Cincinnati,
Mount-Pleasant, East Palo Alto, Ambler and Portland in the United States; Frankfurt in Germany; Beaucaire, Valernes, Limay, Rousset, Romainville, Neuville and Vitry in France; Dagenham in the United Kingdom; Brindisi and Garessio in Italy; Ujpest in
Hungary; Hlohovec in Slovakia; Prague in the Czech Republic; and on a number of sites divested to third parties and covered by contractual environmental guarantees granted by sanofi-aventis. Sanofi-aventis may also have potential liability for
investigation and cleanup at several other sites.



Provisions have been established for the sites already identified and to cover contractual guarantees for environmental liabilities for
sites that have been divested. For example, in 2007 the State of New Jersey initiated a claim against Bayer CropScience seeking compensation for damages caused to natural resources (NRD) at a former Rhône-Poulenc site in the United States,
resulting in indemnification claims by Bayer CropScience against the Group under contractual environmental guarantees granted at the time of Bayers acquisition of the CropScience business. Rehabilitation studies and an NRD assessment are
underway in a similar project in Portland, Oregon. Potential environmental contingencies arising from certain business divestitures are described in Note D.22.e) to the consolidated financial statements included at Item 18 of this annual
report. In 2010, sanofi-aventis spent 45 million on rehabilitating sites previously contaminated by soil or groundwater pollution. During the year ended December 31, 2010, a comprehensive review was carried out relating to the legacy
of environmental pollution. In light of data collected during this review, the Group adjusted the provisions to approximately 781 million as at December 31, 2010.



Because of changes in environmental regulations governing
site remediation the Groups provisions for remediation obligations may not be adequate due to the multiple factors involved, such as the complexity of operational or previously operational sites, the nature of claims received, the
rehabilitation techniques considered, the planned timetable for rehabilitation, and the outcome of discussions with national regulatory authorities or other potentially responsible parties, as in the case of multiparty sites. Given the long
industrial history of some of our sites and the legacy obligations of Aventis arising from its past involvement in the chemical and agrochemical industries, it is impossible to quantify the future impact of these laws and regulations with precision.
See Item 3.D. Risk Factors  Environmental Risks of Our Industrial Activities.



To our knowledge, the Group is not currently subject to liabilities for non-compliance with current HSE laws and regulations that could be expected to significantly jeopardize its activities, financial
situation or operating income. We also believe that we are in substantial compliance with current HSE laws and regulations and that all the environmental permits required to operate our facilities have been obtained. Regular HSE audits (22 in 2010)
are carried out by the Group in order to assess compliance with our standards (which implies compliance with regulations) and to initiate corrective measures. Moreover, 103 loss prevention technical visits were carried out in 2010.



Sanofi-aventis has implemented a worldwide master policy on
health, safety and the environment to promote the health and well-being of the employees and contractors working on its sites and respect for the environment. We consider this master policy to be an integral part of our commitment to social
responsibility. In order to implement this master policy, 77 rules (policies) have been drawn up in the key fields of HSE management, Good HSE Practices, safety in the workplace, process safety, industrial hygiene, health in the workplace and
protection of the environment.



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Health



From the development of compounds to the commercial launch
of new drugs, sanofi-aventis research scientists continuously assess the effect of products on human health. This expertise is made available to employees through two committees responsible for chemical and biological risk assessment. The
Groups COVALIS committee classifies all chemical and pharmaceutical products handled within the Group and establishes workplace exposure limits for each of them. The Groups TRIBIO Committee is responsible for classifying all biological
agents according to their degree of pathogenicity, and applies rules for their containment and the preventive measures to be respected throughout the Group. See Item 3. Key Information  D. Risk Factors  Environmental Risks of Our
Industrial Activities  Risks from the handling of hazardous materials could adversely affect our results of operations.



Appropriate Industrial Hygiene practices and programs are defined and implemented in each site. These practices consist essentially of
containment measures for collective and individual protection against exposure in all workplaces where chemical substances or biological agents are handled. All personnel are monitored with an appropriate initial and routine medical program, focused
on the potential occupational health risks linked to their duties.



In addition, a committee has been set up to prepare and support the implementation of the new European Union REACH regulation on Registration, Evaluation, Authorization and Restriction of Chemicals. To
fully comply with the new European regulation on the labeling of chemicals (Classification Labeling Packaging), the Group has registered the relevant hazardous chemical substances with the European Chemicals Agency (ECHA).



Safety



Sanofi-aventis has rigorous policies to identify and
evaluate safety risks and to develop preventive safety measures, and methods for checking their efficacy. Additionally, sanofi-aventis invests in training that is designed to instill in all employees a sense of concern for safety, regardless of
their duties. These policies are implemented on a worldwide scale to ensure the safety of all employees and to protect their health. Each project, whether in research, development or manufacturing, is subject to evaluation procedures, incorporating
the chemical substance and process data communicated by the COVALIS and TRIBIO committees described above. The preventive measures are designed primarily to reduce the number and seriousness of work accidents and to minimize exposures involving
permanent and temporary sanofi-aventis employees as well as our sub-contractors.



The French chemical manufacturing sites in Aramon, Neuville-sur-Saône, Sisteron, Vertolaye and Vitry, as well as the plants located in the Hoechst Industry Park in Frankfurt, Germany, the Zentiva
site in Hlohovec, Slovakia, and the chemical production site in Budapest, Hungary, are listed Seveso II (from the name of the European directive that deals with potentially dangerous sites through a list of activities and substances associated
with classification thresholds). In accordance with French law on technological risk prevention, the French sites are also subject to heightened security inspections in light of the toxic or flammable materials stored on the sites and used in the
operating processes.



Risk assessments of
processes and their installations are drawn up according to standards and internal guidelines incorporating the best state-of-the-art benchmarks for the industry. These assessments are used to fulfill regulatory requirements and are regularly
updated. Particular attention is paid to any risk-generating changes: process or installation changes, as well as changes in production scale and transfers between industrial or research units.



Our laboratories that specialize in process safety testing,
which are fully integrated into our chemical development activities, apply methods to obtain the physico-chemical parameters of manufactured chemical substances (intermediate chemical compounds and active ingredients) and apply models to measure the
effect of potentially leachable substances in the event of a major accident. In these laboratories the parameters for qualifying hazardous reactions are also determined to define scale-up process conditions while transferring from development stage
to industrial scale. All these data ensure the relevance of the risk assessments.



We believe that the safety management systems implemented at each site, the hazard studies carried out and the risk management methods implemented, as well as our third-party property insurance policies
covering any third-party physical damage, are consistent with legal requirements and the best practices in the industry.



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Environment



The main objectives of our environmental policy are to implement clean manufacturing
techniques, minimize the use of natural resources and reduce the environmental impact of our activities. In order to optimize and improve our environmental performance, we have a strategy of continuous improvement practiced at all our sites through
the annual implementation of HSE progress plans. In addition, 49 sites are currently ISO 14001 certified. We believe that this strategy clearly expresses the commitment of both management and individuals to health, safety and the environment. In
2010, seven of our European sites were included in the scope of the European CO2Emissions Credit Trading Scheme aimed at helping to reach the targets set by the Kyoto protocol.



Our recent efforts in terms of environmental protection have mainly targeted reductions in energy consumption,
greenhouse gas emissions control, improvements in the performance of water treatment installations, reduction of volatile organic compound emissions, raw material savings and recycling, and reductions in waste materials or increases in the
percentage being recycled. In 2010, we reduced carbon dioxide emissions caused by our sales representation car fleet by 13% versus 2009, due to the policy of using energy efficient cars as well as a reduction in the number of cars. Since 2005, in
terms of our activity level per unit produced, our direct and indirect carbon dioxide emissions have decreased by 8% and 17% respectively(1).



An internal committee of experts called ECOVAL assesses the environmental impact of the pharmaceutical agents found in products marketed
by sanofi-aventis. It has developed an environmental risk assessment methodology and runs programs to collect the necessary data for such assessments. Additional ecotoxicity assessments are being performed on certain substances which predate current
regulations, in order to obtain information that was not gathered when they were launched (as regulatory requirements were different at that time) and evaluate environmental risks resulting from their use by patients.



Markets



A breakdown of revenues by business segment and by geographic region for 2008, 2009 and 2010 can be found at
Note D.35. to our consolidated financial statements included at Item 18 of this annual report.



The following market shares and ranking information is based on sales data from IMS Health MIDAS, retail and hospital for full year 2010, in constant euros (unless otherwise indicated). For more
information on market shares and ranking, see Presentation of Financial and Other Information at the beginning of this document.



Marketing and Distribution



Sanofi-aventis has a commercial presence in approximately 100 countries, and our products are available in more than 170. Our main markets
in terms of net sales are, respectively:



Western Europe represents 29.6% of our net sales; we are the leading pharmaceutical company in France where our market share is 10.1% (11.4% in 2009), and we rank third in Germany with a 5.8% market share
(5.6% in 2009). In 2010, sales in Western Europe were down 8.8% due to the impact of generic competition for
Plavix® and of Taxotere® and of price pressure applied by the healthcare authorities.



The United States represents 29.5% of our net sales ; we rank twelfth with a market share of 3.1% (3.4% in 2009).
Sales in the U.S. were down 8.4% at constant exchange rates in 2010 reflecting the impact of generics of
Lovenox® and Ambien® CR, the workdown of
Eloxatine® generics inventory during the second half of 2010, and the impact of healthcare reform.
Chattems sales are included from February 2010.



Emerging Markets (see definition in B. Business Overview  Strategy, above) represent 29.9% of our net sales, for the first time the largest contribution to net sales of any region. We
are the leading healthcare company in emerging markets. In 2010, sales in emerging markets grew by 16.3% at constant exchange rates. This performance was due to robust organic growth (13.2% on a constant structure basis and at constant exchange



|(1) | The CO2 emissions variations per produced unit are calculated for each business
and added proportionally to their respective contribution to the total of direct and indirect CO2 emissions. Each business defines a specific indicator of its activity (e.g.,
hours worked for vaccines, number of boxes produced for pharmaceuticals, etc.).
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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rates) and the impact of targeted acquisitions (mainly Zentiva in Eastern Europe and Medley in Brazil). In 2010, Brazil, Russia and China generated substantial growth of 51.4%, 19.9% and 23.6%,
respectively. In Latin America, mostly in Brazil and Mexico, growth was driven by flu vaccine sales, which virtually trebled (+189%).



Japan represents 7.3% of our net sales; our market share is 3.1% (3.0% in 2009). In 2010, sales grew by 9.1% at
constant exchange rate and growth was mostly generated by the success of Plavix® (+37.1%) and by a good
performance from the Vaccines activity.



A
breakdown of our sales by geographic market is presented in Item 5. Operating and Financial Review and Prospects  Results of Operations  Year Ended December 31, 2010 Compared with Year Ended December 31, 2009.



Although specific distribution patterns vary by
country, we sell prescription drugs primarily to wholesale drug distributors, independent and chain retail drug outlets, hospitals, clinics, managed care organizations and government institutions. With the exception of Consumer Health Care products,
these drugs are ordinarily dispensed to patients by pharmacies upon presentation of a doctors prescription.



We use a selection of channels to disseminate information about and promote our products among healthcare professionals and patients,
ensuring that the channels not only cover our latest therapeutic advances but also our mature products, as they provide the foundation for satisfying major therapeutic needs. We regularly advertise in medical journals and exhibit at major medical
congresses. In some countries, products are also marketed directly to patients by way of television, radio, newspapers and magazines, and we sometimes use new media channels (such as the internet) to market our products. National education and
prevention campaigns can be used to improve patients knowledge of conditions.



Our medical representatives, who work closely with healthcare professionals, use their expertise to promote and provide information on our drugs. They represent our values on a day-to-day basis and are
required to adhere to a code of ethics. As of December 31, 2010, we had a global sales force of 32,686 representatives: 10,287 in Europe, 5,531 in the United States, and 16,868 in the rest of the world.



Although we market most of our products through our own sales
forces, we have entered into and continue to form partnerships to co-promote/co-market certain products in specific geographic areas. Our major alliances are detailed at  Pharmaceutical Products  Main pharmaceutical products
above.



Our vaccines are sold and distributed
through multiple channels, including physicians, pharmacies, hospitals and distributors in the private sector, and governmental entities and non-governmental organizations in the public and international donor markets, respectively.



Competition



The pharmaceutical industry is currently experiencing significant changes in its competitive environment.
Innovative drugs, a broad product range, and a presence in all geographical markets are key factors in maintaining a strong competitive position.



There are four types of competition in the prescription pharmaceutical market:



| |  |  | competition between pharmaceutical companies to research and develop new patented products or new therapeutic indications;
| | - |  | --------------------------------------------------------------------------------------------------------------------------



| |  |  | competition between different patented pharmaceutical products marketed for the same therapeutic indication;
| | - |  | ------------------------------------------------------------------------------------------------------------



| |  |  | competition between original and generic products or between original biological products and biosimilars, at the end of patent protection; and
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | competition between generic or biosimilar products.
| | - |  | ---------------------------------------------------



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We compete with other pharmaceutical companies in all major markets to develop innovative
new products. We may develop new technologies and new patented products wholly in-house, but we also enter into collaborative R&D agreements in order to access new technologies. See Note D.21. to our consolidated financial statements included at
Item 18 of this annual report.



Our
prescription drugs compete in all major markets against patented drugs from major pharmaceutical companies like Abbott in benign prostatic hyperplasia; AstraZeneca in cardiovascular disease, hypertension and oncology; Bayer-Schering in thrombosis
prevention; Boehringer-Ingelheim in atherothrombosis and benign prostatic hyperplasia; Bristol-Myers Squibb in oncology; Lilly in osteoporosis, diabetes and oncology; GlaxoSmithKline in oncology, allergies, diabetes and thrombosis; Merck in
hypertension, osteoporosis, diabetes and benign prostatic hyperplasia; Novartis in hypertension and oncology; Novo Nordisk in diabetes; Pfizer in oncology, thrombosis and allergies; and Roche in oncology and osteoporosis.



In our Vaccines business, we compete primarily with
multinational players backed by large healthcare groups, including Merck (outside Europe), GlaxoSmithKline, Pfizer (Wyeth) and Novartis.



In selected market segments, sanofi pasteur competes with mid-size international players (such as CSL of Australia in the influenza market
for the Southern Hemisphere). Sanofi Pasteur also competes with an increasing number of manufacturers, entrenched in densely populated and economically emerging regions, which are leveraging their cost/volume advantage and raising their level of
technical capability and quality standards to compete on more sophisticated antigens in their domestic markets and also in international donor markets. Multinational players are increasingly seeking alliances with manufacturers from emerging
economies to secure positions in their markets of origin.



We also face competition from generic drugs that enter the market when our patent protection or regulatory exclusivity expires, or when we lose a patent infringement lawsuit (see  Patents,
Intellectual Property and Other Rights above). Similarly, when a competing patented drug from another pharmaceutical company faces generic competition, these generic products can also affect the competitive environment of our own patented
product.



Competition from producers of generics
has increased sharply in response to healthcare cost containment measures and to the increased number of products for which patents have expired.



Generics manufacturers who have received all necessary regulatory approvals for a product may decide to launch a generic version before
the patent expiry date. Such launch may occur notwithstanding the fact that the owner of the original product may already have commenced patent infringement litigation against the generics manufacturer. Such launches are said to be at
risk for the promoter of the generic product because it may be required to pay damages to the owner of the original product in the context of patent infringement litigation; however, these launches may also significantly impair the
profitability of the pharmaceutical company whose product is challenged.



Another competitive issue drug manufacturers are facing is parallel trade, also known as reimportation. This takes place when drugs sold abroad under the same brand name as in a domestic market are
imported into that domestic market by parallel traders, who may repackage or resize the original product or sell it through alternative channels such as mail order or the Internet. This situation is of particular relevance to the European Union,
where these practices have been encouraged by the current regulatory framework. Parallel traders take advantage of the price differentials between markets arising from factors including sales costs, market conditions (such as intermediate trading
stages), tax rates, or national regulation of prices.



Finally, pharmaceutical companies face illegal competition from counterfeit drugs. The WHO estimates that counterfeit products account for 10% of the market worldwide, rising to as much as 30% in some
countries. However, in markets where powerful regulatory controls are in place, counterfeit drugs are estimated to represent less than 1% of market value.



The WHO also estimates that 50% of sales over the Internet are of counterfeit drugs: their development has intensified in 2010.



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A medical product is counterfeit when there is a false representation in relation to its
identity (e.g., name, composition, strength, etc.) or source (e.g., manufacturer, country of manufacturing/origin, marketing authorization holder, etc.) or its background (e.g., filings and documentation related to its distribution channels).
Sanofi-aventis is committed to being part of any efforts made to overcome drug counterfeiting and has implemented the following actions:



| |  |  | Intensification of close collaboration with international organizations and with customs and police to reinforce regulatory frameworks and to
investigate suspected counterfeiters; and
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Development of technologies to make drugs more difficult to copy through packaging protection programs and to ensure no direct traceability.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------



Regulation



The pharmaceutical and health-related biotechnology sectors
are highly regulated. National and supranational health authorities administer a vast array of legal and regulatory requirements that dictate pre-approval testing and quality standards to maximize the safety and efficacy of a new medical product.
These authorities also regulate product labeling, manufacturing, importation/exportation and marketing as well as mandatory sponsor post-approval commitments.



The submission of an application to a regulatory authority does not guarantee that a license to market/ product approval will be granted.
Furthermore, each regulatory authority may impose its own requirements during the course of the product development and application review. It may refuse to grant approval and require additional data before granting approval, even though the same
product has already been approved in other countries. Regulatory authorities also have the authority to request product recalls, product withdrawals and penalties for violations of regulations based on data that are made available to them.



The International Conference on Harmonization
(ICH) consists of the regulatory agencies of the three founder members (European Union, Japan, United States), plus Health Canada and Swissmedic as observers. Product approval can vary from six months to several years from the date of application
depending upon the country. Factors such as the quality of data submitted, the degree of control exercised by the regulatory authority, the review procedures, the nature of the product and the condition to be treated, play a major role in the length
of time a product is under review.



In recent
years, efforts have been made by the ICH participants to harmonize product development and regulatory submission requirements. An example of these efforts is the Common Technical Document (CTD), which can be used in different ICH regions for a
product application review, with only local or regional adaptation. Electronic CTD is becoming the standard for worldwide product submission.



Pharmaceutical manufacturers have committed to publishing protocols and results of clinical studies performed with their products in
publicly accessible registries (e.g., Clinical Trials Registry, Clinical Trial Results Registry). In addition, the various ICH and non-ICH countries often impose mandatory disclosure of clinical trials information.



The requirement of many countries, including Japan and
several member states of the European Union, to negotiate selling prices or reimbursement rates for pharmaceutical products with government regulators can substantially extend the time for market entry beyond the initial marketing approval. While
marketing authorizations for new pharmaceutical products in the European Union have been substantially centralized with the European Medicines Agency (EMA), pricing and reimbursement remain a matter of national competence.



In the European Union, there are three main procedures by
which to apply for marketing authorization:



| |  |  | The centralized procedure is mandatory for certain types of medicinal products. When an application is submitted to the EMA, the scientific evaluation
of the application is carried out by the Committee for Medicinal Products for Human Use (CHMP) and a scientific opinion is prepared. This opinion is sent to the European Commission which adopts the final decision and grants a Community marketing
authorization. Such a marketing authorization is valid throughout the Community and the drug may be marketed within all European Union member states.
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| |  |  | If a company is seeking a national marketing authorization in more than one Member State, the mutual recognition or decentralized procedure is
available to facilitate the granting of harmonized national authorizations across Member States. Both the decentralized and the mutual recognition procedures are based on the recognition by national competent authorities of a first assessment
performed by the authorities of one member state.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | National authorizations are still possible, but are only for products intended for commercialization in a single EU member state or for line extensions
to existing national product licenses.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Post-authorization safety monitoring of pharmaceutical products is carefully regulated in Europe (Council Regulation (EEC) No 2309/93 and Council Directive -2001/83/EC describe the respective obligations
of the marketing authorization holder and of the competent authorities to set up a system for pharmacovigilance in order to collect, collate and evaluate information about suspected adverse reactions), and pharmacovigilance activities also pertain
to nationally approved products: pharmacovigilance obligations apply to all authorized medicinal products including those authorized before 1 January 1995.



It is possible for health authorities to withdraw products from the market for safety reasons. The responsibilities for pharmacovigilance
rest with the competent authorities of all the Member States in which the authorisations are held. In accordance with the applicable legislation, each Member State has established a pharmacovigilance system for the collection and evaluation of
information relevant to the benefit to risk balance of medicinal products. The competent authority continually monitors the safety profile of the products available on its territory and takes appropriate action where necessary and monitors the
compliance of marketing authorisation holders with their obligations with respect to pharmacovigilance. All relevant information should be shared between the competent authorities and the marketing authorization holder, in order to allow all parties
involved in pharmacovigilance activities to assume their obligations and responsibilities. The principal mandate of the CHMPs Pharmacovigilance Working Party is to provide a forum for dialogue between Member States on pharmacovigilance and to
review safety issues at the request of the competent authorities, for centrally authorized products and products undergoing a referral.



Following a routine inspection of the sanofi-aventis U.S. site in Bridgewater during April and May 2010, the FDA issued a warning letter
citing inadequate procedures for the surveillance, receipt, evaluation and reporting of adverse events in a timely manner, and failure to include all required postmarketing studies in NDA Annual Reports to the agency. The warning letter is specific
to reporting processes and timeframes, not to safety concerns with any specific medication. Sanofi-aventis has already been working to address the observation and is fully committed to ensure compliance with all reporting requirements.



In 2010 new legislation aimed at strengthening and
rationalizing the Community Pharmacovigilance System was approved, which will be enforced in July 2012. Changes include a strengthened legal basis for regulators to require post-authorization safety and efficacy studies throughout the life cycle of
the medicinal product. An additional scientific committee called the Pharmacovigilance Risk Assessment Committee, with a key role in pharmacovigilance assessments (scope: all marketed drugs in the EU), is to be established at the level of the EMA.
This committee, which includes a patient representative, can hold public hearings.



Implementation of this pharmacovigilance legislation will be a particular priority in light of the Mediator affair that has caused uproar in France. Given AFSSAPS stature as a leading regulatory
agency, as well as the way the European regulatory network is organized, (with national agencies that are closely entwined with the EMA through their experts membership of the EMAs various scientific committees and groups), it is
possible the affair will have EU repercussions.



AFSSAPS failures were highlighted in the report by the French Health Ministrys General Inspectorate of Social Affairs (IGAS).
The French Health Minister has outlined a radical set of proposals for AFSSAPS. More input will come from the parliamentary inquiry with a report expected in June, and from a wide consultation on the reform of the regulatory and pharmacovigilance
system to be held with results expected in May.



Some of the measures identified by the French Health Minister are already being addressed in the EU legislation, while others will have
broader implications:



| |  |  | Strengthening policy on conflicts of interest. This was actioned by the EMA in 2010. It can be expected that national agencies will have to examine
their own procedures to see if they could be improved.
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| |  |  | Funding system of regulatory authorities. This is a key issue for national agencies but also for the EMA.
| | - |  | ---------------------------------------------------------------------------------------------------------



| |  |  | Ongoing safety monitoring and life-cycle management approach to monitoring the benefit:risk profile. In its Roadmap to 2015, the EMA calls for a
continuous benefit:risk assessment throughout a products life-cycle. It can be expected that this objective will be implemented with a high priority at the EU level. The new Pharmacovigilance legislation gives the legal basis for enforcing
this life cycle approach, with the power to request Post Authorization Safety and Efficacy Studies at any time.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | New products submitted for approval to be at least equivalent to a product already on the market. This idea which appears to be more radical than the
others, would in reality be more in line with the current tendency of companies to conduct more active control clinical studies.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Other relevant aspects in the EU regulatory framework are the following:



The sunset clause is a provision leading to the cessation of the validity of any marketing
authorization which is not followed by marketing within 3 years or not remaining on the market for a consecutive 3 year period.



Generic products are subject to a harmonized procedure in all countries of the European Union. A generic product should contain the same
active medicinal substance as an originator product. Generic applications are abridged: generic manufacturers only need to submit quality data and demonstrate that the generic drug is bioequivalent to the originator product (i.e., works
in the same way in the patients body), but with no need to submit safety or efficacy data since regulatory authorities can refer to the originator products dossier. Generic product applications can be filed and approved in the European
Union only after the eight year data exclusivity period of the originator product has expired. Further, generic manufacturers can only market their generic products after a 10- or 11-year period from the date of approval of the originator
product has elapsed.



The EMA has introduced a
series of initiatives aimed at improving the transparency of its activities, such as the publication of the European Public Assessment Report, which contains product approvals, withdrawals and rejections. In addition, there is an increased focus on
comparative effectiveness. New initiatives have been proposed with regard to the disclosure of information on marketing authorization applications; meanwhile, the EMA has become more proactive on the disclosure of documents/information throughout
the product lifecycle, with an emphasis on safety related data. In addition, patients and consumers are increasingly involved in the work of the EMAs scientific committees.



A regulation in pediatric development came into force in
January 2007. It is aimed at promoting the development of drugs well adapted to children and ensuring safe use in the pediatric population. Incentives are proposed such as extension of SPC (Supplementary Protection Certificate) or data protection
for PUMA (Pediatric Use Marketing Authorization).



A new regulatory framework has been implemented covering Advanced Therapy Medicinal Products (ATMPs). This new legislation provides
specific requirements for the approval, supervision and pharmacovigilance of ATMPs. A new scientific committee  the Committee for Advanced Therapies (CAT)  has been established within the EMA to play a central role in the scientific
assessment of ATMPs.



An additional regulatory
change relates to variations in marketing authorizations with a view to rendering the whole system for post-authorization activities simpler, clearer and more flexible without compromising public health.



International collaboration between regulatory authorities
continues to develop with implementation of confidentiality arrangements between ICH regulatory authorities, and with non-ICH regulatory authorities. Examples include work-sharing on Good Clinical Practices (GCP) inspections between the United
States and the European Union, as well as creating permanent representatives from the U.S. Food and Drug Administration (FDA) and Japanese Pharmaceutical and Medical Devices Agency (PMDA) now based in London, and a corresponding permanent
representative from EMA at the FDA.



In the United
States, applications for drug and biological approval are submitted for review to the FDA, which has broad regulatory powers over all pharmaceutical products that are intended for U.S. sale and marketing. To commercialize a product, a New Drug
Application (NDA) under the Food, Drug and Cosmetic



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(FD&C) Act or Biological License Application (BLA) under the Public Health Service (PHS) Act is submitted to the FDA with data for filing and pre-market review. Specifically, the FDA must
decide whether the product is safe and effective for its proposed use, if the benefits of the drugs use outweigh its risks, whether the drugs labeling is adequate, and if the manufacturing of the drug and the controls used for
maintaining quality are adequate to preserve the drugs identity, strength, quality and purity. Based upon this review, the FDA can require post-approval commitments. Approval for a new indication of a previously approved product requires the
submission of a supplemental NDA (sNDA) for a drug or supplemental BLA (sBLA) for a biological product.



In the United States, generic drug manufacturers may file an Abbreviated NDA (ANDA) under 505(j) of the FD&C Act. These applications
are abbreviated because they are generally not required to include data to establish safety and effectiveness, but need only demonstrate that their product is bioequivalent (i.e., performs in humans in the same manner as the
originators product). Consequently, the length of time and cost required for development of generics can be considerably less than for the originators drug. The ANDA pathway in the United States can only be used for NDA approved drugs
under the FD&C Act and not for BLA approved biological products under the PHS Act.



In Japan, the regulatory authorities can require local development studies. They can also request bridging studies to verify that foreign clinical data are applicable to Japanese patients and require data
to determine the appropriateness of the dosages for Japanese patients. These additional procedures have created a significant delay in the registration of some innovative products in Japan compared to the European Union and United States.



Focus on Biologics



Products can be referred to as biologics when
they are derived from plant or animal tissues, including blood products or products manufactured within living cells (e.g., antibodies). Most biologics are complex molecules or mixtures of molecules which are difficult to characterize and require
physico-chemical-biological testing, and an understanding of and control over the manufacturing process.



The concept of generics is not scientifically appropriate for biologics due to their high level of complexity and therefore
the concept of biosimilar products is more appropriate. A full comparison of the purity, safety and efficacy of the biosimilar product against the reference biological product should be undertaken, including assessment of
physical/chemical, biological, non-clinical and clinical similarity.



In the European Union, a regulatory framework for developing and evaluating biosimilar products has been in place since November 2005. The CHMP has issued several product/disease specific guidelines for
biosimilar products. In March 2009, the CHMP adopted a guideline on preclinical and clinical development of biosimilars of low molecular weight heparins. For example, in Europe a potential product candidate claiming to be biologically similar to
Lovenox® must show therapeutic equivalence in terms of efficacy and safety in at least one adequately powered,
randomized, double-blind, parallel group clinical trial. With respect to vaccines, the CHMP has taken the position that currently it is unlikely that these products may be characterized at the molecular level, and that each vaccine product must be
evaluated on a case by case basis.



In Japan,
guidelines defining the regulatory approval pathway for follow-on biologics were finalized in March 2009. These guidelines set out the requirements on preclinical and clinical data to be considered for the development of the new application category
of biosimilars.



For
historical reasons in the U.S., a few complex protein-based drugs have been approved as NDAs under the Federal Food Drug and Cosmetic Act (FD&C Act). It is currently possible to submit an abbreviated application (ANDA) with respect to those
particular products (e.g., Lovenox®, Lantus®). Since an ANDA is not required to contain clinical trial data other than from bioequivalence studies, the appropriateness of an ANDA with respect to these NDA
approved biological products raises significant scientific issues for the FDA.



The FD&C Act provides another abbreviated option for NDA approved biological products, called the 505(b)(2) pathway. This pre-market application may refer to the FDA finding that the reference product
has been found to be safe and effective by the FDA based upon the innovators preclinical and clinical data.



Lovenox® (enoxaparin) was approved as a drug by the FDA on March 29, 1993. Lovenox® was approved under Section 505(b)(1) of the FD&C Act and not as a biologic under Section 351 of the Public Health



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Service Act, and therefore a biosimilar of the product was not possible. An abbreviated NDA (ANDA/generic) application was submitted to FDA August 2005 by Momenta/Sandoz under section 505(j)
of the FFDCA. This application was approved July 2010; the generic product was approved as therapeutically equivalent to
Lovenox®. Two other generic applications are believed to be pending with the FDA; one submitted by
Teva and the other from Amphastar, both in 2003. Teva received a Minor Deficiency letter from the FDA on January 25, 2011 and has stated that it expects to answer those deficiencies in the near future.



U.S. law now provides for a procedure for
biosimilar versions of a reference product licensed as a biological under the PHS Act. Healthcare reform legislation entitled the Patient Protection and Affordable Care Act, was signed into law by the President on
March 30, 2010. Title VII, Subtitle A Biologics Price Competition and Innovation, allows for the creation of a regulatory approval pathway for biosimilars and a litigation procedure for patent infringement lawsuits brought against
biosimilar applicants. Previously, a biological product was defined under the PHS Act, Section 351, as a virus, therapeutic serum, toxin, antitoxin, vaccine, blood, blood component or derivative, allergenic product or analogous product or
arsphenamine or derivative of arsphenamine (or any other trivalent organic arsenic compound), applicable to the prevention, treatment, or cure of a disease or condition of human beings.



In the U.S., Lovenox® is approved as a drug NDA (New Drug Application) under the FD&C Act. The new U.S. Biosimilars Law currently covers products regulated as Biologics under the
Public Health Services (PHS) Act and therefore does not apply to Lovenox® or other products approved as drugs.



Under the new U.S. law, the definition of
biological product in section 351(i) is revised to include proteins, except any chemically synthesized polypeptide. In addition, this law describes how a Biosimilar product may be highly similar to the reference
product notwithstanding minor differences in clinically inactive components, and for which there are no clinically meaningful differences between the biological product and the reference product in terms of safety, purity and
potency of the product.



This law also
stated that approval of an application under section 351(k) may not be made effective until 12 years after the date on which the reference product was first licensed under section 351(a). The date on which the reference product was first
licensed does not include the date of approval of: (1) a supplement for the biological product that is the reference product; (2) a subsequent application by the reference product sponsor or manufacturer for a change (other than a
structural modification) that results in a new indication, route of administration, dosing schedule, dosage form, delivery system, delivery device, or strength for the previously licensed reference product; or (3) a subsequent application by
the reference product sponsor or manufacturer for a modification to the structure of the reference product that does not result in a change in safety, purity, or potency.



Other provisions of this new U.S. law state that ten years
after enactment, certain biological products approved under section 505 of the FD&C Act will be deemed licensed under section 351 of the PHS Act. Prior to that time, the current legal interpretation is that they cannot be
reference products for applications submitted under section 351(k) of the PHS Act. The new law also describes how a biological product that is shown to meet the new interchangeability standards, may be substituted for the reference
product without the intervention of the healthcare provider who prescribed the reference product.



Pricing & Reimbursement



Rising overall healthcare costs are leading to efforts to curb drug expenditures in most markets in which sanofi-aventis operates. Increasingly these efforts result in pricing and market access controls
for pharmaceuticals. The nature and impact of these controls vary from country to country, but some common themes are reference pricing, systematic price reductions, formularies, volume limitations, patient co-pay requirements, and generic
substitution. In addition, governments and third-party payers are increasingly demanding comparative / relative effectiveness data to support their decision making process. They are also increasing their utilization of emerging healthcare
information technologies such as electronic prescribing and health records to enforce transparency and tight compliance with these regulations and controls. As a result, the environment in which pharmaceutical companies must operate in order to make
their products available to patients and providers who need them continues to grow more complex each year.



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Significant changes in the Pharmaceutical/Healthcare environment emerged during 2010:



| |  |  | In the United States, 2010 was marked by the health insurance and market reforms that are expected to lead to a large number of uninsured being covered
by 2014, either through state aid or mandatory coverage, with a system of fines for non-compliance. These reforms will also see the establishment of a health insurance exchange and the eventual closure of the doughnut hole in Medicare
Part D.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In Europe, several countries (including, Germany, Greece, Spain, Portugal and Ireland) have introduced emergency cost containment measures and reforms,
following economic crises, that led to a reduction in the price of marketed drugs and will significantly affect the size of the pharmaceutical market. In parallel, Germany introduced a law that would effectively put an end to the free-price-setting
system through systematic health technology assessments and pricing negotiations. And in the United Kingdom, the new coalition government is looking to end the current Pharmaceutical Price Regulation Scheme (PPRS 2014) with a shift towards
value-based pricing with less emphasis on the Incremental Cost Effectiveness Ratio (ICER) price-setting methods currently used by the National Institute for Clinical Excellence (NICE).
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In Asia, several countries have sought to increase patient access to medicines: in the Philippines, this is being achieved through direct price cuts
whereas in China and Thailand, it is being achieved through healthcare expansion towards universal coverage in association with price rationalization, starting with cuts in the prices of drugs on the Essential Drug List in China.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In Russia, healthcare expansion and price rationalization have also been the subject of legislative reforms.
| | - |  | ------------------------------------------------------------------------------------------------------------



Regardless of the exact method, we believe that third-party
payers will continue to act to curb the cost of pharmaceutical products. While the impact of these measures cannot be predicted with certainty, we are taking the necessary steps to defend the accessibility and price of our products in order to
reflect the value of our innovative product offerings:



| |  |  | We actively engage with our key stakeholders on the value of our products to them. These stakeholders  including physicians, patient groups,
pharmacists, government authorities and third-party payers  can have a significant impact on the market accessibility of our products.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | We continue to add flexibility and adaptability to our operations so as to better prepare, diagnose, and address issues in individual markets.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Keeping in mind the importance of recognizing the value of our products and the high cost of research and development, we continue to analyze
innovative pricing and access strategies that balance patient accessibility with appropriate rewards for innovation.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Insurance and Risk Coverage



We are protected by four key insurance programs, relying not only on the traditional corporate insurance and reinsurance market but also
on a mutual insurance company established by various pharmaceutical groups and our captive insurance company, Carraig Insurance Ltd (Carraig).



These four key programs cover Property & Business Interruption, General Liability, Stock and Transit, and Directors &
Officers Liability.



Our captive insurance
company, Carraig, participates in our coverage for various lines of insurance including excess property, stock and transit and product liability. Carraig is run under the supervision of the Irish regulatory authorities, is wholly owned by
sanofi-aventis, and has sufficient resources to meet the risks that it covers. It sets premiums for Group entities at market rates. Claims are assessed using the traditional models applied by insurance and reinsurance companies, and the
companys reserves are regularly checked and confirmed by independent actuaries.



Our Property & Business Interruption program covers all Group entities worldwide, wherever it is possible to use a centralized program operated by our captive insurance company. This approach
shares risk between



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Group entities, enabling us to set deductibles and guarantees that are appropriate to the needs of local entities. A further benefit of this program is that traditional insurance cover is
supplemented by specialist cover, thanks to the involvement of an international mutual insurance company established by a number of pharmaceutical groups. It also incorporates a prevention program, including a comprehensive site visit program
covering our production, storage, research and distribution facilities and standardized repair and maintenance procedures across all sites. Specialist site visits are conducted every year to address specific needs, such as testing of sprinkler
systems or emergency plans to deal with flooding risks.



The Stock and Transit program protects goods of all kind owned by the Group that are in transit nationally or internationally, whatever the means of transport, and all our inventories wherever they are
located. Sharing risk between Group entities means that we can set deductibles at appropriate levels, for instance differentiating between goods that require temperature controlled distribution and those that do not. We have developed a prevention
program with our insurers, implementing best practices in this area at our distribution sites. This program, which is led by our captive insurance company, has substantial capacity, largely to deal with the growth in sea freight which can lead to a
concentration of value in a single ship.



Our
General Liability & Product Liability program has been renewed for all our subsidiaries worldwide wherever it was possible to do so, despite the increasing reluctance in the insurance and reinsurance market to cover product liability risks
for large pharmaceutical groups. For several years, insurers have been reducing product liability cover because of the difficulty of insuring some products that have been subject to numerous claims. These products are excluded from the cover
provided by insurers, and hence from the cover obtained by us on the insurance market. This applies to a few of our products, principally those described in Note D.22.a) to our consolidated financial statements included at Item 18 in this
annual report. Because of these market conditions we have increased, year by year, the extent to which we self-insure.



The principal risk exposure for our pharmaceutical products is covered with low deductibles at the country level, the greatest level of
risk being retained by our captive insurance company. The level of risk self-insured by the Group  including our captive reinsurance company  enables us to retain control over the management and prevention of risk. Our negotiations with
third-party insurers and reinsurers are tailored to our specific risks. In particular, they allow for differential treatment of products in the development phase, for the discrepancies in risk exposure between European countries and the United
States, and for specific issues arising in certain jurisdictions. Coverage is adjusted every year in order to take into account the relative weight of new product liability risks such as those emerging from healthcare products which are not subject
to market approval.



Our cover for risks that are
not specific to the pharmaceutical industry (general liability) is designed to address the potential impacts of our operations.



In respect of all lines of business of Carraig, outstanding claims are covered by provisions for the estimated cost of settling all claims
incurred up to, but not paid at the balance sheet date, whether reported or not, together with all related claims handling expenses. Where there is sufficient history from the company or from the market of claims made and settlements, an incurred
but not reported (IBNR) actuarial technique is developed by management with the assistance of expert external actuaries to determine a reasonable estimate of the captives exposure to unasserted claims for those risks. The actuaries perform an
actuarial valuation of the IBNR loss and ALAE (allocated loss adjustment expense) liabilities of the Company as of year end. Two ultimate loss projections (based upon reported losses and paid losses respectively) using the Bornhuetter-Ferguson
method are computed each year. Provisions are recorded on that basis.



The Directors & Officers Liability program protects all our legal entities and their directors and officers. Our captive insurance company is not involved in this program.



These insurance programs are backed by best-in-class insurers
and reinsurers and are designed in such a way that we can integrate most newly-acquired businesses on a continuous basis. Our cover has been designed to reflect our risk profile and the capacity available in the insurance market. By centralizing our
major programs, not only do we reduce costs, but we also provide world-class coverage for the entire Group.



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C. Organizational Structure



Sanofi-aventis is the holding company of a consolidated
group of subsidiaries. The table below sets forth our significant subsidiaries and affiliates as of December 31, 2010. For a complete list of our main consolidated subsidiaries, see Note F. to our consolidated financial statements, included in
this annual report at Item 18.



|                                       |  |                        |  |                             |      | 
|-------------------------------------- |  | ---------------------- |  | --------------------------- | ---- | 
|Significant Subsidiary or Affiliate    |  | Country ofOrganization |  | Ownershipand VotingInterest |     
|Aventis Inc.                           |  | United States          |  |                             | 100% | 
|Aventis Pharma S.A.                    |  | France                 |  |                             | 100% | 
|Hoechst GmbH                           |  | Germany                |  |                             | 100% | 
|Merial Ltd                             |  | United Kingdom         |  |                             | 100% | 
|Sanofi-aventis Amérique du Nord S.A.S. |  | France                 |  |                             | 100% | 
|Sanofi-Aventis Deutschland GmbH        |  | Germany                |  |                             | 100% | 
|Sanofi-aventis Europe S.A.S.           |  | France                 |  |                             | 100% | 
|Sanofi-aventis France                  |  | France                 |  |                             | 100% | 
|Sanofi-aventis K.K.                    |  | Japan                  |  |                             | 100% | 
|Sanofi-aventis Participations S.A.S.   |  | France                 |  |                             | 100% | 
|Sanofi-aventis U.S. LLC                |  | United States          |  |                             | 100% | 
|Sanofi-aventis U.S. Inc.               |  | United States          |  |                             | 100% | 
|Sanofi Pasteur Inc.                    |  | United States          |  |                             | 100% | 
|Sanofi Pasteur S.A.                    |  | France                 |  |                             | 100% | 
|Sanofi Winthrop Industrie              |  | France                 |  |                             | 100% | 



Sanofi-aventis and its subsidiaries form a group, organized around two activities: Pharmaceutical products and Human Vaccines. The Group
is also active in Animal Health through Merial.



The patents and trademarks of the pharmaceutical activity are primarily owned by the sanofi-aventis parent company, Aventis Pharma S.A.
(France), Hoechst GmbH (Germany) and Sanofi-Aventis Deutschland GmbH (Germany).



Within the Group, the holding company oversees research and development activities by defining strategic priorities, coordinating work, and taking out industrial property rights under its own name and at
its own expense. In order to fulfill this role, sanofi-aventis subcontracts research and development to its specialized French and foreign subsidiaries, in many cases licensing its patents, manufacturing know-how and trademarks. In these cases, the
licensee subsidiaries manufacture and distribute the Groups products, either directly or via local distribution entities.



In certain countries, sanofi-aventis carries out part of its business operations through ventures with local partners.
In addition, the Group has signed worldwide alliances by which two of its products (Plavix® and Aprovel®) are marketed through an alliance with BMS (see  Pharmaceutical Products  Main Pharmaceutical
Products above).



For most Group
subsidiaries, sanofi-aventis provides financing and centrally manages their cash surpluses. Under the alliance arrangement with BMS, cash surpluses and cash needs arising within alliance entities give rise to symmetrical monthly transfers between
the two groups. The holding company also operates a centralized foreign exchange risk management system, which enters into positions to manage the operational risks of its main subsidiaries.



D. Property, Plant and Equipment



Our headquarters are located in Paris, France. See
 Office Space below.



We operate
our business through offices and research, production and logistics facilities in approximately 100 countries. All our support functions operate out of our office premises. A breakdown of these sites by use and by ownership/leasehold status is
provided below. Breakdowns are based on surface area. All surface area figures are unaudited.



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Breakdown of sites by use*



|           |  |  |     | 
|---------- |  |  | --- | 
|Industrial |  |  | 50% | 
|Research   |  |  | 15% | 
|Offices    |  |  | 14% | 
|Logistics  |  |  | 6%  | 
|Vaccines   |  |  | 11% | 
|Others     |  |  | 4%  | 



|* | Excludes Vaccines entities. During 2010, our Vaccines business was still treated a separate unit,
with its own offices and research, production and logistics facilities. In 2011, all premises occupied by sanofi pasteur will be incorporated into the Groups global real estate portfolio, and allocated between the four uses shown in the table
above.
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Breakdown of the Groups
sites between owned and leased



|       |  |  |     | 
|------ |  |  | --- | 
|Leased |  |  | 35% | 
|Owned  |  |  | 65% | 



We own most of our research and development and production facilities, either freehold or under finance leases with a purchase option
exercisable at expiration.



Research and Development Sites:
Pharmaceuticals segment



Research and
Development activities are housed at 22 sites:



| |  |  | 8 operational sites in France, the largest in terms of built-on surface area in use being Vitry/Alfortville (approximately 105,000 m2),
Montpellier (106,000 m2), Chilly/Longjumeau
(114,000 m2) and Toulouse (60,500 m2);
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | 5 sites in other European countries (Germany, United Kingdom, Hungary, Spain and Italy), the largest being in Frankfurt, Germany (84,000 m2);
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | 6 sites in the United States, the largest being in Bridgewater, New Jersey (111,000 m2);
| | - |  | ----------------------------------------------------------------------------------------



| |  |  | 1 site in Tokyo, Japan;
| | - |  | -----------------------



| |  |  | 2 sites in China: the principal facility in Shanghai, and a Clinical Research Unit in Beijing.
| | - |  | ----------------------------------------------------------------------------------------------



Industrial Sites: Pharmaceuticals Segment



Production of chemical and pharmaceutical products is the
responsibility of our Industrial Affairs function, which is also in charge of most of our logistics facilities (distribution and storage centers).



We have 75 industrial sites worldwide. The sites where the major sanofi-aventis drugs, active ingredients and medical devices are
manufactured are:



| |  |  | France: Ambarès
(Aprovel®, Depakine®, Multaq®), Le Trait (Lovenox®), Maisons-Alfort (Lovenox®), Neuville (dronedarone), Quetigny
(Stilnox®, Plavix®), Sisteron (clopidogrel bisulfate, dronedarone, zolpidem tartrate), Tours (Stilnox®, Aprovel®, Xatral®), Vitry-sur Seine / Alfortville (docetaxel) ;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Germany: Frankfurt (insulins, ramipril, Lantus®, Tritace®, pens, Apidra®);
| | - |  | --------------------------------------------------------------------------



| |  |  | Italy: Scoppito
(Tritace®, Amaryl®);
| | - |  | ------------------------------------



| |  |  | United Kingdom: Dagenham
(Taxotere®), Fawdon (Plavix®, Aprovel®); Holmes Chapel
(Nasacort®);
| | - |  | --------------------------------------------------------------------------------------------



| |  |  | Hungary: Ujpest (irbesartan), Csanyikvölgy (Lovenox®);
| | - |  | ------------------------------------------------------



| |  |  | Japan: Kawagoe
(Plavix®);
| | - |  | -------------------------



| |  |  | United States: Kansas City (Allegra®), Chattem (consumer health products).
| | - |  | --------------------------------------------------------------------------



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Sanofi Pasteur Sites



The headquarters of our Vaccines division, sanofi pasteur,
are located in Lyon, France. Sanofi Pasteurs production and/or Research and Development sites are located in Swiftwater, Cambridge, Rockville Canton and Orlando (United States), Toronto (Canada), Marcy lEtoile and Val de Reuil (France),
Shenzhen (China), Pilar (Argentina), Chachoengsao (Thailand), and Hyderabad (India).



In May 2009, sanofi aventis launched the construction of a new sanofi pasteur vaccine manufacturing center in Neuville-sur-Saône, France. The investment of 350 million euros, the largest ever made
by sanofi-aventis, takes place on an exisiting sanofi-aventis site. The objective is to progressively transition the existing chemical activity to vaccine production.



In 2010, sanofi pasteur acquired
VaxDesign located in Orlando, Florida. VaxDesigns Modular IMmune In-vitro Construct (MIMIC®) System is
designed to capture genetic and environmental diversity and predict human immune responses. The MIMIC® platform
is expected to accelerate vaccine development, reduced time to market and increased probability of success rates in pre-clinical and clinical stages.



We own most of sanofi pasteurs Research and Development and production sites, either freehold or under finance leases with a
purchase option exercisable at expiration.



Merial Sites



Because we intend to contribute Merial to a
joint venture in 2011 and consequently lose our exclusive control (see Note D.8.1 to our consolidated financial statements included at Item 18 of this annual report) we have not included Merial sites in the discussion included at this Item 4.
Information on the Company  D. Property, Plant and Equipment notwithstanding the fact that on December 31, 2010, Merial was a wholly owned subsidiary of sanofi-aventis. Merial has 16 industrial sites, 9 research and development
sites and numerous administrative offices with its principal headquarters located at Lyon (France) and Duluth (United States).



Acquisitions, Capital Expenditures and Divestitures



The carrying amount of our property, plant and equipment at December 31, 2010 was 8,155 million. During 2010, we invested
1,199 million (see Note D.3. to the consolidated financial statements) in increasing capacity and improving productivity at our various production and R&D sites.



The Groups principal capital expenditures and
divestments for 2008, 2009 and 2010 are set out in this annual report at Item 5. Operating and Financial Review and Prospects  Divestments,  Acquisitions and  Liquidity and Capital Resources and
in the notes to the consolidated financial statements (Note D.1., Note D.2., Note D.3. and Note D.4. to our consolidated financial statements included at Item 18 of this annual report).



Our principal investments in progress are described below:



| |  |  | In Europe, we continued to optimize our industrial facilities, in particular by investing in two new Lantus® production lines at the Frankfurt site and acquiring the Diabel manufacturing site from Pfizer to strengthen our
insulin production capacity. We invested in the Brindisi (Italy) site to expand its production of spiramycin, the active ingredient of the antibiotic Rovamycin® . In the United States, we are investing ahead of the launch of epiCard®, a gas powered single dose, single use auto-injector with audible user instructions for the injection of
Epinephrine®, indicated for the emergency treatment of severe allergic reactions.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | We have also begun the Biolaunch project, designed to convert our chemical facilities to biotechnologies, with a project to create a monoclonal
antibody production facility at our Vitry-sur-Seine site in France from 2012, plus investments in the creation of a new innovative biosynthetic process at the Elbeuf and Vertolaye industrial sites, in order to improve our corticosteroid production
competitiveness at a global level.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In Emerging Markets, we currently rely on industrial sites dedicated to serving regional markets, a situation reinforced by our 2009 acquisitions
(Zentiva in Eastern Europe and Medley in Brazil). In
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| | China, the project to extend our current manufacturing facility located at the Beijing Economic and Technological Development Area will enable us to install assembly and packaging lines for
SoloSTAR®, the pre-filled injection pen used to administer Lantus® (insulin glargine). In Hangzhou (China), we are building a new manufacturing site to replace the current
manufacturing facility in downtown Hangzhou. The new site is scheduled to be completed in 2012. In Russia, the Orel insulin factory, recently acquired following the deal with Bioton Vostok, is a key element of our strategy to improve
and improve and accelerate our access to the fast-growing Russian market. In Latin America, we are expanding our manufacturing operations in Argentina, where we already have a factory producing vaccines with the acquisition of the Merck Schering
Plough site in Mirador (Buenos Aires).
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Our Vaccines segment has invested significantly in recent years, with the construction of a state-of-the-art research facility in Toronto (Canada); the
creation of a new vaccines campus in Neuville (France); the construction of bulk and filling facilities in Val de Reuil (France) and a bacteriological bulk facility in Marcy lÉtoile (France); the creation of two new influenza vaccine
facilities in Shenzhen (China) and Ocoyoacac (Mexico); and the completion of bulk and filling facilities in Swiftwater (United States), mainly dedicated to influenza and meningitis vaccines.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Other investments related mainly to Research & Development sites.
| | - |  | -----------------------------------------------------------------



As of December 31, 2010, our firm orders related to future capital expenditure amounted to
321 million. They were mainly related to the following industrial sites: Swiftwater (United States) and Marcy LEtoile for the vaccines activity, and Vitry (France) and Frankfurt (Germany) for the pharmaceuticals activity.



In the medium term and on a constant structure
basis, we expect our yearly average capital expenditure to be in the range of 1.4 billion. We believe that our existing cash resources and unused credit facilities will be sufficient to finance these investments.



Office Space



As part of the rationalization of our office sites in the Paris region of France, we have since mid-2009 been
reviewing our medium-term office space master plan for the Greater Paris area. This review is expected to result in all our Corporate and Operating Division support functions being housed on a smaller number of sites (five in 2011, when phase 1 is
implemented). All of these sites will meet environmental certification standards, and offer cost-effective space solutions. The first step in the master plan was the closure of our offices on the Quai de la Rapée in the 12th
arrondissement of Paris.



We have also
chosen our new corporate headquarters in the Rue La Boétie, in the 8th arrondissement of Paris, at the heart of the citys business district. This headquarters building will bring all our Corporate and Operating Division support
functions together on a single site, symbolizing the transformation of sanofi-aventis.



All of our research and development support functions will be housed on our Chilly Mazarin site (once the existing laboratory premises have been converted for office use) and on our Vitry site.



Finally, our current corporate headquarters at
174 avenue de France in the 13th arrondissement of Paris will be closed at end 2011, along with the adjacent site at 182 avenue de France and our Val de Bièvre site at Gentilly.



The second phase of the Greater Paris office space master plan is currently under consideration, the aim being
to reduce the overall area in use and the overall cost of operation.



Item 4A. Unresolved Staff Comments



N/A



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Item 5. Operating and Financial Review and Prospects



You should read the following discussion in conjunction with
our consolidated financial statements and the notes thereto included in this annual report at Item 18.



Our consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as issued
by the International Accounting Standards Board (IASB) and with IFRS adopted by the European Union as of December 31, 2010.



The following discussion contains forward-looking statements that involve inherent risks and uncertainties. Actual results may differ
materially from those contained in such forward-looking statements. See  Cautionary Statement Regarding Forward-Looking Statements at the beginning of this document.



2010 Overview



Throughout 2010, sanofi-aventis continued to implement its
transformation and sustainable growth strategy. Despite sales erosion for some of our flagship products under pressure from generics, healthcare reforms in the United States and lower drug prices in Europe, we once again delivered a solid
performance by reinforcing our growth platforms, pushing ahead with our transformation program and maintaining tight cost control.



Consolidated net sales for the year reached 30,384 million, up 3.7% compared to 2009, down 0.8% at constant
exchange rates (see definition at  Presentation of Net Sales below). Sales were driven by good performances from our Emerging Markets, Diabetes and Consumer Health Care growth platforms, which offset the significant impact of
competition from generics. Emerging Markets is now the region with the largest contribution to consolidated net sales, edging out the United States and Western Europe. Other highlights of 2010 included the launch of the anti-cancer drug Jevtana® in the United States, the ongoing worldwide rollout of the anti-arrhythmic Multaq®, and the introduction of the Intanza® and Fluzone® High Dose
influenza vaccines.



Ongoing measures to adapt our
resources enabled us to reduce our research and development expenses and selling and general expenses by 6.2% and 1.2% respectively (at constant exchange rates). On a reported basis, they respectively decreased by 4.0% and increased by 3.3%.
Together, these operating expenses represented 39.4% of our net sales, compared with 40.6% in 2009. Business net income was 9,215 million, 6.8% higher than in 2009 on a reported basis. This reflects sales growth and tight control over
operating costs, plus an increased contribution from the Merial business and favorable trends in various currencies against the euro during the year. Business earnings per share was 7.06, up 6.8% compared to 2009 on a reported basis; on a
diluted basis, business earnings per share was 7.04 (up 6.7%). Business net income and business earnings per share are non-GAAP financial measures which our management uses to monitor our operational performance, and which are defined at
 Business Net Income below.



Net
income attributable to equity holders of sanofi-aventis totaled 5,467 million, 3.8% higher than in 2009. Basic earnings per share for 2010 was 4.19, 4.0% higher than in 2009; diluted earnings per share for 2010 was 4.18 (up
3.7%).



Sanofi-aventis continued to set a lively
pace in its targeted acquisitions and R&D alliance strategy. We successfully completed the acquisition of Chattem, Inc., one of the leading manufacturers and distributors of branded consumer health products, toiletries and dietary supplements in
the United States. Further additions to our Consumer Health Care platform came with the acquisition of Nepentes S.A. in Poland, the formation of a joint venture with Minsheng Pharmaceutical Co., Ltd, and the acquisition of BMP Sunstone Corporation
in China. In Generics, we set up a joint venture in Japan with Nichi-Iko Pharmaceutical Co., Ltd. In the United States, we acquired two R&D companies, TargeGen and VaxDesign Corporation. In Animal Health, we exercised our contractual right in
March 2010 to combine Merial with the Intervet/Schering-Plough business to form a new joint venture equally owned by Merck and sanofi-aventis; closing of the transaction is expected in 2011. In addition, we entered into a significant number of
collaboration and licensing agreements that give us access to new technologies and expand or bolster our existing research fields  especially in diabetes, oncology, vaccines, pain relief and fibrosis.



While we continue our transformation process focusing on our
growth platforms and cost containment, we expect erosion from generic competition to accelerate, with a negative impact on net income in 2011.



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In October 2010, sanofi-aventis initiated a tender offer to acquire all outstanding shares
of common stock of Genzyme Corporation (Genzyme). Genzyme is a leading U.S. biotechnology company specialized in rare diseases. On February 16, 2011, sanofi-aventis and Genzyme announced they had entered into a merger agreement providing
for the acquisition of Genzyme by sanofi-aventis. The agreement is described at Item 10.C. Material Contracts. On the basis of 272.5 million Genzyme shares on a diluted basis, the improved offer price values Genzyme at approximately
$20.1 billion, the majority of which will be financed through new debt. We will also issue contingent value rights, the terms of which are described at Item 10.C. Material Contracts. The acquisition remains subject to fulfillment of a
number of conditions including acceptance of the offer by holders of a majority of shares of Genzyme common stock on a diluted basis.



Our operations generate significant cash flow. We recorded 9,759 million of net cash provided by operating activities in 2010
compared to 8,515 million in 2009. During the course of 2010, we paid out 3.1 billion in dividends and repaid part of our debt. With respect to our financial position, we ended 2010 with our debt, net of cash and cash
equivalents (meaning the sum of short-term and long-term debt plus related interest rate and currency derivatives, minus cash and cash equivalents) at 1,577 million (2009: 4,128 million). Debt, net of cash and cash equivalents,
is a non-GAAP financial measure that is used by management and investors to measure the Companys overall net indebtedness and to assess the Companys financing risk as measured by its gearing ratio (debt, net of cash and cash equivalents,
to total equity). Our gearing ratio stood at 3.0% at the end of 2010 versus 8.5% at the end of 2009. See  Liquidity and Capital Resources  Consolidated Balance Sheet and Debt below.



Purchase Accounting Effects (primarily the acquisition of Aventis in 2004)



Our results of operations and financial
condition for the years ended December 31, 2010, December 31, 2009 and December 31, 2008 have been significantly affected by our August 2004 acquisition of Aventis and certain subsequent transactions.



The Aventis acquisition has given rise to significant
amortization (3,070 million in 2010, 3,175 million in 2009 and 3,298 million in 2008) and impairment of intangible assets (127 million in 2010, 344 million in 2009 and 1,486 million
in 2008).



In order to isolate the impact of these
and certain other items, we use as an evaluation tool a non-GAAP financial measure that we refer to as business net income. For a further discussion and definition of business net income, see  Business Net
Income below. For consistency of application of this principle, business net income also takes into account the impact of our subsequent acquisitions.



Business net income for the years ended December 31, 2010, 2009 and 2008 is presented in  Business Net Income
below.



Sources of Revenues and Expenses



Revenue. Revenue arising from the sale of goods is
presented in the income statement under Net sales. Net sales comprise revenue from sales of pharmaceutical products, vaccines, and active ingredients, net of sales returns, of customer incentives and discounts, and of certain sales-based
payments paid or payable to the healthcare authorities. Returns, discounts, incentives and rebates described above are recognized in the period in which the underlying sales are recognized, as a reduction of sales revenue. See Note B.14. to our
consolidated financial statements included at Item 18 of this annual report. We sell pharmaceutical products and human vaccines directly, through alliances, and through licensees throughout the world. When we sell products directly, we record
sales revenues as part of our consolidated net sales. When we sell products through alliances, the revenues reflected in our consolidated financial statements are based on the overall level of sales of the products and on the arrangements governing
those alliances. For more information about our alliances, see  Financial Presentation of Alliances below. When we sell products through licensees, we receive royalty income that we record in Other revenues. See Note C.
to the consolidated financial statements included at Item 18 of this annual report.



Cost of Sales. Our cost of sales consists primarily of the cost of purchasing active ingredients and raw materials, labor and other costs relating to our manufacturing activities, packaging
materials, payments made



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under licensing agreements and distribution costs. We have license agreements under which we distribute products that are patented by other companies and license agreements under which other
companies distribute products that we have patented. When we pay royalties, we record them in cost of sales, and when we receive royalties, we record them in Other revenues as discussed above.



Operating Income. Our operating income reflects our
revenues, our cost of sales and the remainder of our operating expenses, the most significant of which are research and development expenses and selling and general expenses. For our business segments, we also measure our results of operations
through an indicator referred to as Business Operating Income, which we describe below under  Segment Information  Business Operating Income of Segments.



Segment Information



Operating Segments



In accordance with IFRS 8 Operating Segments, we have defined our segments as Pharmaceuticals and Human
Vaccines (Vaccines). Our other identified segments are categorized as Other.



The Pharmaceuticals segment includes our research, development, production and sales activities relating to pharmaceutical products, including prescription, consumer health care and generic products. This
segment also includes equity affiliates and joint ventures with pharmaceutical business activities, including in particular the entities that are majority-held by BMS. See  Financial Presentation of Alliances below.



The Vaccines segment includes our research, development,
production and sales activities relating to human vaccines. This segment also includes our Sanofi Pasteur MSD joint venture with Merck & Co., Inc. in Western Europe.



The Other segment includes all segments that are not
reportable under IFRS 8, including in particular our interest in the Yves Rocher group, our animal health business (Merial) and the impact of our retained liabilities in connection with divested businesses.



Inter-segment transactions are not material.



Business Operating Income of Segments



We measure the results of operations of our operating
segments on the basis of Business Operating Income, a performance measure that we adopted in accordance with IFRS 8. Our chief operating decision-maker uses Business Operating Income to evaluate the performance of our operating
managers and to allocate resources.



Business Operating Income is derived from Operating income, adjusted as follows:



| |  |  | amortization and impairment losses charged against intangible assets are eliminated;
| | - |  | ------------------------------------------------------------------------------------



| |  |  | restructuring costs are eliminated;
| | - |  | -----------------------------------



| |  |  | gains and losses on disposals, and litigation, are eliminated;
| | - |  | --------------------------------------------------------------



| |  |  | the share of profits/losses of associates and joint ventures is added, and net income attributable to non-controlling interests is deducted;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | other acquisition-related effects (primarily, the workdown of acquired inventories remeasured at fair value at the acquisition date, and the impact of
acquisitions on investments in associates and joint ventures) are eliminated; and
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | restructuring costs relating to associates and joint ventures are eliminated.
| | - |  | -----------------------------------------------------------------------------



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The following table presents our Business Operating Income for the year ended
December 31, 2010.



|                                                         |  |                 |        |   |          |  |        |       |  |  |       |   |  |  |        |  
|-------------------------------------------------------- |  | --------------- | ------ | - | -------- |  | ------ | ----- |  |  | ----- | - |  |  | ------ | -
|( million)                                              |  | Pharmaceuticals |        |   | Vaccines |  |        | Other |  |  | Total |  
|Net sales                                                |  |                 | 26,576 |   |          |  | 3,808  |       |  |  |      |   |  |  | 30,384 |  
|Other revenues                                           |  |                 | 1,623  |   |          |  | 28     |       |  |  |      |   |  |  | 1,651  |  
|Cost of sales                                            |  |                 | (7,316 | ) |          |  | (1,371 | )     |  |  |      |   |  |  | (8,687 | )
|Research and development expenses                        |  |                 | (3,884 | ) |          |  | (517   | )     |  |  |      |   |  |  | (4,401 | )
|Selling and general expenses                             |  |                 | (6,962 | ) |          |  | (603   | )     |  |  | (2    | ) |  |  | (7,567 | )
|Other operating income and expenses                      |  |                 | 177    |   |          |  | 14     |       |  |  | (108  | ) |  |  | 83     |  
|Share of profit/loss of associates and joint ventures(1) |  |                 | 1,009  |   |          |  | 19     |       |  |  | 8     |   |  |  | 1,036  |  
|Net income from the held-for-exchange Merial business    |  |                 |       |   |          |  |       |       |  |  | 418   |   |  |  | 418    |  
|Net income attributable to non-controlling interests     |  |                 | (258   | ) |          |  | 1      |       |  |  |      |   |  |  | (257   | )
|Business operating income                                |  |                 | 10,965 |   |          |  | 1,379  |       |  |  | 316   |   |  |  | 12,660 |  



|(1) | Net of tax
|--- | ----------



The following table presents our Business Operating Income
for the year ended December 31, 2009.



|                                                         |  |                 |        |   |          |  |        |       |  |  |       |   |  |  |        |  
|-------------------------------------------------------- |  | --------------- | ------ | - | -------- |  | ------ | ----- |  |  | ----- | - |  |  | ------ | -
|( million)                                              |  | Pharmaceuticals |        |   | Vaccines |  |        | Other |  |  | Total |  
|Net sales                                                |  |                 | 25,823 |   |          |  | 3,483  |       |  |  |      |   |  |  | 29,306 |  
|Other revenues                                           |  |                 | 1,412  |   |          |  | 31     |       |  |  |      |   |  |  | 1,443  |  
|Cost of sales                                            |  |                 | (6,527 | ) |          |  | (1,326 | )     |  |  |      |   |  |  | (7,853 | )
|Research and development expenses                        |  |                 | (4,091 | ) |          |  | (491   | )     |  |  | (1    | ) |  |  | (4,583 | )
|Selling and general expenses                             |  |                 | (6,762 | ) |          |  | (561   | )     |  |  | (2    | ) |  |  | (7,325 | )
|Other operating income and expenses                      |  |                 | 387    |   |          |  | (3     | )     |  |  | 1     |   |  |  | 385    |  
|Share of profit/loss of associates and joint ventures(1) |  |                 | 792    |   |          |  | 41     |       |  |  | 8     |   |  |  | 841    |  
|Net income from the held-for-exchange Merial business    |  |                 |       |   |          |  |       |       |  |  | 241   |   |  |  | 241    |  
|Net income attributable to non-controlling interests     |  |                 | (426   | ) |          |  | (1     | )     |  |  |      |   |  |  | (427   | )
|Business operating income                                |  |                 | 10,608 |   |          |  | 1,173  |       |  |  | 247   |   |  |  | 12,028 |  



|(1) | Net of tax
|--- | ----------



Business Net Income



In addition to net income, we use a non-GAAP financial
measure that we refer to as business net income to evaluate our Groups performance. Business net income, which is defined below, represents the aggregate business operating income of all of our operating segments, less net
financial expenses and the relevant income tax charges. We believe that this non-GAAP financial measure allows investors to understand the performance of our Group because it segregates the results of operations of our current business activities,
as opposed to reflecting the impact of past transactions such as acquisitions.



Our management uses business net income to manage and to evaluate our performance, and we believe it is appropriate to disclose this non-GAAP financial measure, as a supplement to our IFRS reporting, in
order to assist investors in analyzing the factors and trends affecting our business performance. Our management also intends to use business net income as the basis for proposing the dividend policy for the Group. Accordingly, management believes
that an investors understanding of trends in our dividend policy is enhanced by disclosing business net income.



We have also decided to report business earnings per share. Business earnings per share is a specific non-GAAP financial
measure, which we define as business net income divided by the weighted average number



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of shares outstanding. Our management intends to give earnings guidance based on business earnings per share. We also present business earnings per share on a diluted basis.



Business net income is defined as Net income
attributable to equity holders of sanofi-aventis, determined under IFRS, excluding (i) amortization of intangible assets; (ii) impairment of intangible assets; (iii) other impacts associated with acquisitions (including impacts
of acquisitions on associates and joint ventures); (iv) restructuring costs (including restructuring costs relating to associates and joint ventures), gains and losses on disposals of non-current assets, and costs or provisions associated with
litigation; (v) the tax effect related to the items listed in (i) through (iv), as well as (vi) effects of major tax disputes and (vii) the share of non-controlling interests in items (i) through (vi). The items listed in
(iv)  except for restructuring costs related to associates and joint ventures  correspond to those reported in the line items Restructuring costs and Gains and losses on disposals, and litigation, as defined in
Note B.20. to our consolidated financial statements.



The following table reconciles our business net income to Net income attributable to equity holders of sanofi-aventis for the years ended December 31, 2010, 2009 and 2008:



|                                                            |  |                                                                                                                                                |       |  |        |   |       |      |        |   |       |  |        |  
|----------------------------------------------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------- | ----- |  | ------ | - | ----- | ---- | ------ | - | ----- |  | ------ | -
|( million)                                                 |  | 2010                                                                                                                                           |       |  | 2009   |   |       | 2008 |       
|Business net income                                         |  |                                                                                                                                                | 9,215 |  |        |   | 8,629 |      |        |   | 7,314 | 
|(i)                                                         |  | Amortization of intangible assets                                                                                                              |       |  | (3,529 | ) |       |      | (3,528 | ) |       |  | (3,483 | )
|(ii)                                                        |  | Impairment of intangible assets                                                                                                                |       |  | (433   | ) |       |      | (372   | ) |       |  | (1,554 | )
|(iii)                                                       |  | Expenses arising from the impact of acquisitions on inventories(1)                                                                             |       |  | (30    | ) |       |      | (27    | ) |       |  | (2     | )
|(iv)                                                        |  | Restructuring costs                                                                                                                            |       |  | (1,372 | ) |       |      | (1,080 | ) |       |  | (585   | )
|(iii)/(iv)                                                  |  | Other items(2)                                                                                                                                 |       |  | (138   | ) |       |      |       |   |       |  | 114    |  
|(v)                                                         |  | Tax effects of:                                                                                                                                |       |  | 1,841  |   |       |      | 1,629  |   |       |  | 1,904  |  
|                                                            |  |  amortization of intangible assets                                                                                                            |       |  | 1,181  |   |       |      | 1,126  |   |       |  | 1,189  |  
|                                                            |  |  impairment of intangible assets                                                                                                              |       |  | 143    |   |       |      | 136    |   |       |  | 537    |  
|                                                            |  |  expenses arising from the impact of acquisitions on inventories                                                                              |       |  | 9      |   |       |      | 7      |   |       |  | 1      |  
|                                                            |  |  restructuring costs                                                                                                                          |       |  | 462    |   |       |      | 360    |   |       |  | 196    |  
|                                                            |  |  other items                                                                                                                                  |       |  | 46     |   |       |      |       |   |       |  | (19    | )
|(iii)/(vi)                                                  |  | Other tax items(3)                                                                                                                             |       |  |       |   |       |      | 106    |   |       |  | 221    |  
|(vii)                                                       |  | Share of items listed above attributable to non-controlling interests                                                                          |       |  | 3      |   |       |      | 1      |   |       |  |       |  
|(iii)                                                       |  | Expenses arising from the impact of the Merial acquisition(4)                                                                                  |       |  | (32    | ) |       |      | (66    | ) |       |  | (50    | )
|(iii)/(iv)                                                  |  | Restructuring costs of associates and joint ventures, and expenses arising from the impact of acquisitions on associates and joint
ventures(5) |       |  | (58    | ) |       |      | (27    | ) |       |  | (28    | )
|Net income attributable to equity holders of
sanofi-aventis |  |                                                                                                                                                | 5,467 |  |        |   | 5,265 |      |        |   | 3,851 | 

|                                                                                                        |  |  |      |   |  |  |     |  |  |  |     | 
|------------------------------------------------------------------------------------------------------- |  |  | ---- | - |  |  | --- |  |  |  | --- | 
|(1)   This line comprises the workdown of inventories remeasured at fair value at the acquisition date. | 
|(2)   Other items comprise :                                                                            | 
| gain on sale of investment in Millennium                                                              |  |  |      |   |  |  |     |  |  |  | 38  | 
| reversals of/charges to provisions for risks                                                          |  |  | (138 | ) |  |  |     |  |  |  | 76  | 
|(3)   Other tax items comprise :                                                                        |  |  |      |   |  |  |     |  |  |  |     | 
| provisions for/settlements of tax disputes                                                            |  |  |      |   |  |  |     |  |  |  | 221 | 
| reversal of deferred taxes following ratification of the Franco-American Treaty                       |  |  |      |   |  |  | 106 |  |  |  |     | 

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |  |  |  |  |  |  |  |  |  |  | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  |  |  |  |  |  |  |  |  |  |  | 
|(4)   This line comprises: until September 17, 2009, amortization and impairment charged
against the intangible assets of Merial; and from September 18, 2009, (i) the impact of the discontinuation of depreciation of the property, plant and equipment of Merial in accordance with IFRS 5 (see Note B.7. to our consolidated
financial statements) and (ii) the expense arising from the workdown of inventories remeasured at fair value at acquisition date. |  |  |  |  |  |  |  |  |  |  |  | 
|(5)   This line shows the portion of major restructuring costs incurred by associates and joint
ventures, and expenses arising from the impact of acquisitions on associates and joint ventures (workdown of acquired inventories, amortization and impairment of intangible assets, and impairment of goodwill).                                                                                                                                                  | 



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The most significant reconciliation items in the table above relate to the purchase
accounting effect of our acquisitions, particularly the amortization and impairment of intangible assets. We believe that excluding these non-cash charges enhances an investors understanding of our underlying economic performance because we do
not consider that the excluded charges reflect the combined entitys ongoing operating performance. Rather, we believe that each of the excluded charges reflects the decision to acquire the businesses concerned.



The purchase-accounting effects on net income primarily
relate to:



| |  |  | charges to cost of sales resulting from the workdown of acquired inventory that was written up to fair value, net of tax;
| | - |  | -------------------------------------------------------------------------------------------------------------------------



| |  |  | charges related to the impairment of goodwill; and
| | - |  | --------------------------------------------------



| |  |  | charges related to the amortization and impairment of intangible assets, net of tax and non-controlling interests.
| | - |  | ------------------------------------------------------------------------------------------------------------------



We believe (subject to the limitations described below) that
disclosing business net income enhances the comparability of our operating performance, for the following reasons:



| |  |  | the elimination of charges related to the purchase accounting effect of our acquisitions (particularly amortization and impairment of finite-lived
intangible assets) enhances the comparability of our ongoing operating performance relative to our peers in the pharmaceutical industry that carry these intangible assets (principally patents and trademarks) at low book values either because they
are the result of in-house research and development that has already been expensed in prior periods or because they were acquired through business combinations that were accounted for as poolings-of-interest;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the elimination of selected items, such as the increase in cost of sales arising from the workdown of inventories remeasured at fair value, gains and
losses on disposals of non-current assets and costs and provisions associated with major litigation, improves comparability from one period to the next; and
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the elimination of restructuring costs relating to the implementation of our transformation strategy enhances comparability because these costs are
directly, and only, incurred in connection with transformation processes such as the rationalization of our research and development structures.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



We remind investors, however, that business net income should
not be considered in isolation from, or as a substitute for, net income attributable to equity holders of sanofi-aventis reported in accordance with IFRS. In addition, we strongly encourage investors and potential investors not to rely on any single
financial measure but to review our financial statements, including the notes thereto, and our other publicly filed reports, carefully and in their entirety.



There are material limitations associated with the use of business net income as compared to the use of IFRS net income attributable to
equity holders of sanofi-aventis in evaluating our performance, as described below:



| |  |  | The results presented by business net income cannot be achieved without incurring the following costs that the measure excludes:
| | - |  | --------------------------------------------------------------------------------------------------------------------------------



| |  |  | Amortization of intangible assets. Business net income excludes the amortization charges related to intangible assets. Most of these
amortization charges relate to intangible assets that we have acquired. Although amortization is a non-cash charge, it is important for investors to consider it because it represents an allocation in each reporting period of a portion of the
purchase price that we paid for certain intangible assets that we have acquired through acquisitions. For example, in connection with our acquisition of Aventis in 2004, we paid an aggregate of 31,279 million for these amortizable
intangible assets (which, in general, were to be amortized over their useful lives, which represented an average amortization period of eight years) and 5,007 million for in-progress research & development. A large part of our
revenues could not be generated without owning acquired intangible assets.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Restructuring costs. Business net income does not reflect restructuring costs even though it does reflect the benefits of the optimization of
our activities, such as our research and development activities, much of which we could not achieve in the absence of restructuring costs.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| |  |  | In addition, the results presented by business net income are intended to represent the Groups underlying performance, but items such as gains
and losses on disposals and provisions associated with major litigation may recur in future years.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



We compensate for the above-described material limitations by using business net income only to supplement our IFRS financial reporting
and by ensuring that our disclosures provide sufficient information for a full understanding of all adjustments included in business net income. In addition, subject to applicable law, we may in the future decide to report additional non-GAAP
financial measures which, in combination with business net income, may compensate further for some of the material limitations described above.



In determining the level of future dividend payments, and in analyzing dividend policy on the basis of business net income, our management
intends to take into account the fact that many of the adjustments reflected in business net income have no effect on the underlying amount of cash available to pay dividends. However, although the adjustments relating to the elimination of the
effect of the purchase accounting treatment of the Aventis acquisition and other acquisitions represent non-cash charges, the adjustments relating to restructuring costs represent significant cash charges in the periods following the closing of the
acquisition.



This Item 5 contains a
discussion and analysis of business net income on the basis of consolidated financial data. Because our business net income is not a standardized measure, it may not be comparable with the non-GAAP financial measures of other companies using the
same or a similar non-GAAP financial measure.



Presentation of
Net Sales



In the discussion below, we
present our consolidated net sales for 2010, 2009 and 2008. We break down our net sales among various categories, including by business segment, product and geographic region. We refer to our consolidated net sales as reported sales.



In addition to reported sales, we analyze
non-GAAP financial measures designed to isolate the impact on our net sales of currency exchange rates and changes in group structure.



When we refer to changes in our net sales at constant exchange rates, we exclude the effect of exchange rates by recalculating
net sales for the current year using the exchange rates that were used for the previous year. See Note B.2 to our consolidated financial statements for further information relating to the manner in which we translate into euros transactions recorded
in other currencies.



When we refer to our net
sales on a constant structure basis, we eliminate the effect of changes in structure by restating the net sales for the previous period as follows:



| |  |  | by including sales from an entity or with respect to product rights acquired in the current period for a portion of the previous period equal to the
portion of the current period during which we owned them, based on sales information we receive from the party from whom we make the acquisition;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | similarly, by excluding sales for a portion of the previous period when we have sold an entity or rights to a product in the current period; and
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | for a change in consolidation method, by recalculating the previous period on the basis of the method used for the current period.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------



A reconciliation of our
reported net sales to our net sales at constant exchange rates and on a constant structure basis is provided at  Results of Operations  Year Ended December 31, 2010 Compared with Year Ended December 31, 2009  Net
Sales and at  Results of Operations  Year Ended December 31, 2009 Compared with Year Ended December 31, 2008  Net Sales below.



Financial Presentation of Alliances



We have entered into a number of alliances for the
development, co-promotion and/or co-marketing of our products. We believe that a presentation of our two principal alliances is useful to an understanding of our financial statements.



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The financial impact of the alliances on the Companys income statement is described in
 Results of Operations  Year Ended December 31, 2010 Compared with Year Ended December 31, 2009 and  Year Ended December 31, 2009 Compared with Year Ended December 31, 2008, in particular
in  Net sales,  Other Revenues,  Share of Profit/Loss of Associates and Joint Ventures and  Net Income Attributable to Non-Controlling Interests.



Alliance Arrangements with Bristol-Myers Squibb



Our revenues, expenses and operating income are affected
significantly by the presentation of our alliance with Bristol-Myers Squibb (BMS) in our consolidated financial statements.



There are three principal marketing arrangements that are used:



| |  |  | Co-marketing. Under the co-marketing system, each company markets the products independently under its own brand names. We record our own sales
and related costs in our consolidated financial statements.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Exclusive Marketing. Under the exclusive marketing system, one company has the exclusive right to market the products. We record our own sales
and related costs in our consolidated financial statements.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Co-promotion. Under the co-promotion system, the products are marketed through the alliance arrangements (either by contractual arrangements or
by separate entities) under a single brand name. The accounting treatment of the co-promotion agreement depends upon who has majority ownership and operational management in that territory, as discussed below.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The alliance arrangements include two royalty streams that
are applied on a worldwide basis (excluding Japan and other opt out countries), regardless of the marketing system and regardless of which company has majority ownership and operational management:



| |  |  | Discovery Royalty. As inventor of the two molecules, we earn an adjustable discovery royalty on all Aprovel® / Avapro® / Karvea® / Avalide® and Plavix® / Iscover® sold in alliance
countries regardless of the marketing system. The discovery royalty earned in territories under operational management of BMS is reflected in our consolidated income statement in Other revenues.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Development Royalty. In addition to the discovery royalty, we and BMS are each entitled to a development royalty related to certain know-how and
other intellectual property in connection with sales of Aprovel® / Avapro® / Karvea® / Avalide® and Plavix® / Iscover®.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | We record development royalties paid to BMS in our consolidated income statement as an increase to our cost of sales in countries where we consolidate
sales of the products. We record development royalties that we receive as other revenues in countries where BMS consolidates sales of the products.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Under the alliance arrangements, there
are two territories, one under our operational management and the other under the operational management of BMS. The territory under our operational management consists of Europe and most of Africa and Asia, while the territory under the operational
management of BMS consists of the rest of the world (excluding Japan). In Japan, Aprovel® has been marketed
jointly by Shionogi Pharmaceuticals and Dainippon Sumitomo Pharma Co. Ltd since June 2008. Our alliance with BMS does not cover distribution rights to Plavix® in Japan, which is marketed by sanofi-aventis.



Territory under our operational management. In the territory under our operational management, the marketing arrangements and
recognition of operations by the Group are as follows:



| |  |  | we use the co-promotion system for most of the countries in Western Europe for Aprovel® / Avapro® / Karvea® / Avalide® and Plavix® / Iscover® and for certain Asian countries for Plavix® / Iscover®. We record 100% of
all alliance revenues and expenses in our consolidated financial statements. We also record, as selling and general expenses, payments to BMS for the cost of BMSs personnel involved in the promotion of the products. BMSs share of the
operating income of the alliances is recorded as non-controlling interests;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | we use the co-marketing system in Germany, Spain and Greece for both Aprovel® / Avapro® / Karvea® / Avalide® and Plavix® / Iscover® and in Italy for Aprovel® / Avapro® / Karvea® / Avalide®; and
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| |  |  | we have the exclusive right to market Aprovel® / Avapro® / Karvea® / Avalide® and Plavix® / Iscover® in Eastern Europe, Africa, the Middle East, and certain Asian countries (excluding Japan); we have the exclusive
right to market Aprovel® in Scandinavia and Ireland, and
Plavix® in Malaysia.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Territory under BMS operational management. In the
territory under BMS operational management, the marketing arrangements and recognition of operations by the Group are as follows:



| |  |  | we use the co-promotion system in the United States, Canada and Puerto Rico, where the products are sold through the alliances under the operational
management of BMS. With respect to Avapro® (the brand name used in the United States for Aprovel®) and Plavix®, we record our share of the alliances operating income under share of profit/loss of associates and joint ventures. We also record payments from BMS
for the cost of our personnel in connection with the promotion of the product as a deduction from our selling and general expenses;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | we use the co-marketing system in Brazil, Mexico, Argentina and Australia for Plavix® / Iscover® and Aprovel® / Avapro® / Karvea® / Avalide® and in Colombia for Plavix® / Iscover®; and
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | we have the exclusive right to market the products in certain other countries of Latin America.
| | - |  | -----------------------------------------------------------------------------------------------



In countries where the products are marketed by BMS on a
co-marketing basis, or through alliances under the operational management of BMS, we also earn revenues from the sale of the active ingredients for the products to BMS or such entities, which we record as Net sales in our consolidated
income statement.



Alliance arrangements with Warner
Chilcott (previously with Procter & Gamble Pharmaceuticals)



Our agreement with Warner Chilcott (the Alliance Partner) covers the worldwide development and marketing
arrangements of Actonel®, except Japan for which we hold no rights. Until October 30, 2009, this agreement
was between sanofi-aventis and Procter & Gamble Pharmaceuticals (P&G). Since the sale by P&G of its pharmaceutical business to Warner Chilcott on October 30, 2009, Actonel® has been marketed in collaboration with Warner Chilcott. The local marketing arrangements may take various forms.



| |  |  | Co-promotion,whereby sales resources are pooled but only one of the two parties to the alliance agreement (sanofi-aventis or the Alliance
Partner) invoices product sales. Co-promotion is carried out under contractual agreements and is not based on any specific legal entity. The Alliance Partner sells the product and incurs all of the related costs in France and Canada. This
co-promotion scheme formerly included Germany, Belgium and Luxembourg until December 31, 2007, the Netherlands until March 31, 2008, and the United States and Puerto Rico until March 31, 2010. We recognize our share of revenues under
the agreement in our income statement as a component of operating income in the line item Other operating income. Since April 1, 2010, we have received royalties from the Alliance Partner on sales made by the Alliance Partner in the
United States and Puerto Rico. In the secondary co-promotion territories (the United Kingdom until December 31, 2008, Ireland, Sweden, Finland, Greece, Switzerland, Austria, Portugal and Australia), we sell the product and recognize all the
revenues from sales of the product along with the corresponding expenses. The share due to the Alliance Partner is recognized in Cost of sales;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Co-marketing, which applies in Italy whereby each party to the alliance agreement sells the product in the country under its own brand name, and
recognizes all revenues and expenses from its own operations in its respective income statement. Each company also markets the product independently under its own brand name in Spain, although Spain is not included in the co-marketing territory.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Warner Chilcott only territories: the product has been marketed by the Alliance Partner independently in Germany, Belgium and Luxembourg since
January 1, 2008, in the Netherlands since April 1, 2008 and in the United Kingdom since January 1, 2009. We recognize our share of revenues under the alliance agreement in Other operating income; and
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | sanofi-aventis only territories: we have exclusive rights to sell the product in all other territories. We recognize all revenues and expenses
from our own operations in our income statement, but in return for these exclusive rights pay the Alliance Partner a royalty based on actual sales. This royalty is recognized in Cost of sales.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Further to the termination of an ancillary supply agreement
by Warner Chilcott, sanofi-aventis and Warner Chilcott have begun negotiations on the future of their alliance arrangements.



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Impact of Exchange Rates



We report our consolidated financial statements in euros.
Because we earn a significant portion of our revenues in countries where the euro is not the local currency, our results of operations can be significantly affected by exchange rate movements between the euro and other currencies, primarily the U.S.
dollar and, to a lesser extent, the Japanese yen, and currencies in emerging countries. We experience these effects even though certain of these countries do not account for a large portion of our net sales. In 2010, we earned 29.5% of our net sales
in the United States. A decrease in the value of the U.S. dollar against the euro has a negative impact on our revenues, which is not offset by an equal reduction in our costs and therefore negatively affects our operating income. A decrease in the
value of the U.S. dollar has a particularly significant impact on our operating income, which is higher in the United States than elsewhere, and on the contribution to net income of our alliance with BMS in the United States, which is under the
operational management of BMS, as described at  Financial Presentation of Alliances  Alliance arrangements with Bristol-Myers Squibb above.



For a description of positions entered into to manage
operational foreign exchange risks as well as our hedging policy, see Item 11. Quantitative and Qualitative Disclosures about Market Risk, and Item 3. Key Information  D. Risk Factors  Risks Related to Financial Markets
 Fluctuations in currency exchange rates could adversely affect our results of operations and financial condition.



Divestments



There were no material divestments in 2010, 2009 or 2008.



Acquisitions



| |  |  | The principal acquisitions during 2010 are described below:
| | - |  | -----------------------------------------------------------



In February 2010, sanofi-aventis
acquired the U.S.-based company Chattem, Inc. (Chattem) by successfully completing a cash tender offer. Chattem is a major consumer health player in the United States, producing and distributing branded consumer health products, toiletries and
dietary supplementes accross various market segments. Chattem will manage the Allegra® brand, and act as the
platform for sanofi-aventis over-the-counter and consumer health products in the United States. As of December 31, 2010, sanofi-aventis held 100% of Chattems share capital. See Note D.1. to our consolidated financial statements
included at Item 18 of this annual report.



In April 2010, sanofi-aventis acquired a controlling interest in the capital of Bioton Vostok, a Russian insulin manufacturer. Under the
terms of the agreement, put options were granted to non-controlling interests. See Note D.18. to our consolidated financial statements included at Item 18 of this annual report.



In May 2010, sanofi-aventis formed a new joint venture with Nichi-Iko Pharmaceuticals Co., Ltd. (Nichi-Iko), a
leading generics company in Japan, to expand generics activities in the country. In addition to forming this joint venture, sanofi-aventis took a 4.66% equity interest in the capital of Nichi-Iko.



In June 2010, sanofi-aventis acquired 100% of the share
capital of Canderm Pharma Inc. (Canderm), a privately-held leading Canadian skincare company distributing cosmeceuticals and dermatological products. Canderm generated net sales of 24 million Canadian dollars in 2009.



In July 2010, sanofi-aventis acquired 100% of the share
capital of TargeGen, Inc. (TargeGen), a U.S. biopharmaceutical company developing small molecule kinase inhibitors for the treatment of certain forms of leukemia, lymphoma and other hematological malignancies and blood disorders. An upfront payment
of $75 million was made on completion of the transaction. Future milestone payments may be made at various stages in the development of TG 101348, TargeGens principal product candidate. The total amount of payments (including the upfront
payment) could reach $560 million. See Note D.1. and Note D.18. to our consolidated financial statements included at Item 18 of this annual report.



In August 2010, sanofi-aventis acquired 100% of the share capital of Nepentes S.A. (Nepentes), a Polish manufacturer of pharmaceuticals
and dermocosmetics, for a consideration of PLN 425 million (106 million).



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In October 2010, sanofi pasteur acquired 100% of the share capital of VaxDesign Corporation
(VaxDesign), a privately-held U.S. biotechnology company which has developed a technology reproducing in vitro models of the human immune system, that can be used to select the best candidate vaccines at the pre-clinical stage. Under the terms of
the agreement, an upfront payment of $55 million was made upon closing of the transaction, and a further $5 million will be payable upon completion of a specified development milestone.



In October 2010, sanofi-aventis acquired a 60% equity
interest in the Chinese consumer healthcare company Hangzhou Sanofi Minsheng Consumer Healthcare Co. Ltd, in partnership with Minsheng Pharmaceutical Co., Ltd (Minsheng). Minsheng was also granted a put option over the remaining
shares not held by sanofi-aventis. See Note D.18. to our consolidated financial statements included at Item 18 of this annual report.



In October 2010, sanofi-aventis and BMP Sunstone Corporation (BMP Sunstone) signed an agreement pursuant to which sanofi-aventis
acquired 100% of the share capital of BMP Sunstone on February 24, 2011 for $521 million.



| |  |  | The principal acquisitions during 2009 are described below:
| | - |  | -----------------------------------------------------------



On September 17, 2009, and further to the agreement
signed on July 29, 2009, sanofi-aventis completed the acquisition of the interest held by Merck & Co., Inc. (Merck) in Merial Limited (Merial) for consideration of $4 billion in cash. Founded in 1997, Merial was previously held jointly
(50/50) by Merck and sanofi-aventis, and is now 100% held by sanofi-aventis. Merial is one of the worlds leading animal health companies, with annual sales of $2.6 billion in 2009 and 2010. With effect from September 17, 2009,
sanofi-aventis has held 100% of the shares of Merial and has exercised exclusive control over the company. In accordance with IAS 27, Merial is accounted for by the full consolidation method in the consolidated financial statements of
sanofi-aventis.



In connection with the agreement
signed on July 29, 2009, sanofi-aventis also signed an option contract giving it the possibility, once the Merck/Schering-Plough merger is complete, to combine the Merck-owned Intervet/Schering-Plough Animal Health business with Merial in a
joint venture to be held 50/50 by Merck and sanofi-aventis. The terms of the option contract set a value of $8 billion for Merial. The minimum total value received by Merck and its subsidiaries in consideration for the transfer of
Intervet/Schering-Plough to the combined entity would be $9.25 billion, comprising a minimum value of $8.5 billion for Intervet/Schering-Plough (subject to potential upward revision after valuations performed by the two parties) and additional
consideration of $750 million. An additional balancing payment of $250 million will be made to establish 50/50 parity between Merck and sanofi-aventis in the combined entity.



Because of the high probability of the option being exercised
as of year end 2009, Merial was treated as an asset held for sale or exchange pursuant to IFRS 5 as of December 31, 2009. On March 8, 2010, sanofi-aventis did in fact exercise its contractual right to combine the
Intervet/Schering-Plough Animal Health business with Merial. In addition to execution of final agreements, formation of the new animal health joint venture remains subject to antitrust review in the United States, Europe and other countries, and
other customary closing conditions. Due to the probable formation of the joint venture with Merck in 2011, Merial was still treated as an asset held for sale or exchange pursuant to IFRS 5 as of December 31, 2010. Detailed information about the
impact of Merial on the consolidated financial statements of sanofi-aventis is provided in Note D.1. and Note D.8.1. to our consolidated financial statements included at Item 18 of this annual report.



On March 11, 2009, sanofi-aventis successfully closed
its offer for Zentiva N.V. (Zentiva). As of December 31, 2009, sanofi-aventis held about 99.1% of Zentivas share capital. Following the buyout of the remaining non-controlling interests, sanofi-aventis held 100% of Zentivas share
capital as of December 31, 2010. The purchase price was 1,200 million, including acquisition-related costs. See Note D.1. to our consolidated financial statements included at Item 18 of this annual report.



On March 31, 2009, sanofi-aventis acquired Laboratorios
Kendrick, one of Mexicos leading manufacturers of generics, with sales of approximately 26 million in 2008.



On April 27, 2009, sanofi-aventis acquired a 100% equity interest in Medley, the third largest pharmaceutical company in Brazil and a
leading generics company in that country. The purchase price, based on an enterprise value of 500 million, was 348 million inclusive of acquisition-related costs. See Note D.1. to our consolidated financial statements included
at Item 18 of this annual report.



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On April 27, 2009 sanofi-aventis acquired 100% of BiPar Sciences, Inc. (BiPar), a U.S.
biopharmaceutical company developing novel tumor-selective approaches for the treatment of different types of cancers. BiPar is the leading company in the emerging field of DNA (deoxyribonucleic acid) repair using Poly ADP-Ribose Polymerase (PARP)
inhibitors. The purchase price was contingent on the achievement (regarded as probable) of milestones related to the development of BSI-201, and could reach $500 million. See Note D.1. and Note D.18. to our consolidated financial statements
included at Item 18 of this annual report.



In July 2009, sanofi-aventis completed the acquisition of 100% of the share capital of Helvepharm, a Swiss generics company.



In August 2009, sanofi-aventis took control of Shantha
Biotechnics (Shantha), a vaccines company based in Hyderabad (India). As of December 31, 2010, sanofi-aventis held approximately 96.4% of Shantha. The purchase price allocation led to the recognition of intangible assets (excluding goodwill)
worth 374 million. See Note D.1. to our consolidated financial statements included at Item 18 of this annual report.



On October 30, 2009, sanofi-aventis acquired 100% of the share capital of Fovea Pharmaceuticals SA., a privately-held French
biopharmaceutical research and development company specializing in ophthalmology. The purchase consideration was contingent on milestone payments of up to 280 million linked to the development of three clinical compounds. See Notes D.1.
and D.18. to our consolidated financial statements included at Item 18 of this annual report.



On November 30, 2009, sanofi-aventis completed the acquisition of 100% of the share capital of Laboratoire Oenobiol, one of Frances leading players in health and beauty dietary supplements.



| |  |  | The principal acquisitions during 2008 are described below:
| | - |  | -----------------------------------------------------------



On September 1, 2008,
sanofi-aventis completed the acquisition of the Australian company Symbion CP Holdings Pty Ltd (Symbion Consumer) for AUD560 million. Symbion Consumer manufactures, markets and distributes nutraceuticals (vitamins and mineral supplements) and
over-the-counter brands throughout Australia and New Zealand. Symbion Consumer has a portfolio of brands including Natures
Own®, Cenovis®, Bio-organics®, Golden Glow® and Microgenics®.



On September 25, 2008, sanofi-aventis completed the acquisition of 100% of the share capital of Acambis plc (Acambis) for £285 million. Acambis became Sanofi Pasteur Holding Ltd, a wholly-owned
subsidiary of Sanofi Pasteur Holding SA. This company develops novel vaccines that address unmet medical needs or substantially improve current standards of care. Sanofi Pasteur and Acambis had been developing vaccines in a successful partnership of
more than a decade: Acambis was conducting major projects under exclusive collaboration agreements with sanofi pasteur, for vaccines against dengue fever and Japanese encephalitis.



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Results of Operations



Year Ended December 31, 2010 Compared with Year Ended
December 31, 2009



The consolidated
income statements for the years ended December 31, 2010 and December 31, 2009 break down as follows:



|                                                               |  |      |         |   |                   |  |         |      |  |  |                   |   |  |  |         | 
|-------------------------------------------------------------- |  | ---- | ------- | - | ----------------- |  | ------- | ---- |  |  | ----------------- | - |  |  | ------- | 
|(under IFRS) ( million)                                       |  | 2010 |         |   | as % of
net sales |  |         | 2009 |  |  | as % of
net sales |  
|Net sales                                                      |  |      | 30,384  |   |                   |  | 100.0%  |      |  |  | 29,306            |   |  |  | 100.0%  | 
|Other revenues                                                 |  |      | 1,651   |   |                   |  | 5.4%    |      |  |  | 1,443             |   |  |  | 4.9%    | 
|Cost of sales                                                  |  |      | (8,717  | ) |                   |  | (28.7%) |      |  |  | (7,880            | ) |  |  | (26.9%) | 
|Gross profit                                                   |  |      | 23,318  |   |                   |  | 76.7%   |      |  |  | 22,869            |   |  |  | 78.0%   | 
|Research & development expenses                                |  |      | (4,401  | ) |                   |  | (14.5%) |      |  |  | (4,583            | ) |  |  | (15.6%) | 
|Selling & general expenses                                     |  |      | (7,567  | ) |                   |  | (24.9%) |      |  |  | (7,325            | ) |  |  | (25.0%) | 
|Other operating income                                         |  |      | 359     |   |                   |  |         |      |  |  | 866               |   |  |  |         | 
|Other operating expenses                                       |  |      | (276    | ) |                   |  |         |      |  |  | (481              | ) |  |  |         | 
|Amortization of intangible assets                              |  |      | (3,529  | ) |                   |  |         |      |  |  | (3,528            | ) |  |  |         | 
|Impairment of intangible assets                                |  |      | (433    | ) |                   |  |         |      |  |  | (372              | ) |  |  |         | 
|Restructuring costs                                            |  |      | (1,372  | ) |                   |  |         |      |  |  | (1,080            | ) |  |  |         | 
|Gains and losses on disposals, and litigation                  |  |      | (138    | ) |                   |  |         |      |  |  |                  |   |  |  |         | 
|Operating income                                               |  |      | 5,961   |   |                   |  | 19.6%   |      |  |  | 6,366             |   |  |  | 21.7%   | 
|Financial expenses                                             |  |      | (467    | ) |                   |  |         |      |  |  | (324              | ) |  |  |         | 
|Financial income                                               |  |      | 105     |   |                   |  |         |      |  |  | 24                |   |  |  |         | 
|Income before tax and associates and joint ventures            |  |      | 5,599   |   |                   |  | 18.4%   |      |  |  | 6,066             |   |  |  | 20.7%   | 
|Income tax expense                                             |  |      | (1,242  | ) |                   |  |         |      |  |  | (1,364            | ) |  |  |         | 
|Share of profit/loss of associates and joint ventures          |  |      | 978     |   |                   |  |         |      |  |  | 814               |   |  |  |         | 
|Net income excluding the held-for-exchange Merial business (1) |  |      | 5,335   |   |                   |  | 17.6%   |      |  |  | 5,516             |   |  |  | 18.8%   | 
|Net income from the held-for-exchange Merial business(1)       |  |      | 386     |   |                   |  |         |      |  |  | 175               |   |  |  |         | 
|Net income                                                     |  |      | 5,721   |   |                   |  | 18.8%   |      |  |  | 5,691             |   |  |  | 19.4%   | 
|Net income attributable to non-controlling interests           |  |      | 254     |   |                   |  |         |      |  |  | 426               |   |  |  |         | 
|Net income attributable to equity holders of sanofi-aventis    |  |      | 5,467   |   |                   |  | 18.0%   |      |  |  | 5,265             |   |  |  | 18.0%   | 
|Average number of shares outstanding (million)                 |  |      | 1,305.3 |   |                   |  |         |      |  |  | 1,305.9           |   |  |  |         | 
|Average number of shares outstanding after dilution (million)  |  |      | 1,308.2 |   |                   |  |         |      |  |  | 1,307.4           |   |  |  |         | 
|Basic earnings per share (in euros)                            |  |      | 4,19    |   |                   |  |         |      |  |  | 4.03              |   |  |  |         | 
|Diluted earnings per share (in euros)                          |  |      | 4.18    |   |                   |  |         |      |  |  | 4.03              |   |  |  |         | 



|(1) | Reported separately in accordance with IFRS 5 (Non-Current Assets Held for
Sale and Discontinued Operations). For the other disclosures required under IFRS 5, refer to Note D.8. to our consolidated financial statements included at Item 18 of this annual report.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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Net Sales



Net sales for the year ended December 31, 2010 were
30,384 million, up 3.7% on 2009. Exchange rate movements  principally the appreciation of the U.S. dollar and the yen against the euro  had a favorable effect of 4.5 points. At constant exchange rates, and after taking account
of changes in structure (mainly the consolidation of Zentiva from the second quarter of 2009, and of Chattem from the first quarter of 2010), net sales fell by 0.8% year-on-year. On a constant structure basis and at constant exchange rates, organic
net sales were down 2.7%.



The following table
sets forth a reconciliation of our reported net sales for the years ended December 31, 2010 and December 31, 2009 to our net sales at constant exchange rates and net sales on a constant structure basis.



|                                                                       |  |      |        |   |      |  |        |            |  |  |       | 
|---------------------------------------------------------------------- |  | ---- | ------ | - | ---- |  | ------ | ---------- |  |  | ----- | 
|( million)                                                            |  | 2010 |        |   | 2009 |  |        | Change
(%) | 
|Net sales                                                              |  |      | 30,384 |   |      |  | 29,306 |            |  |  | +3.7% | 
|Effect of exchange rates                                               |  |      | (1,319 | ) |      |  |        |            |  |  |       | 
|Net sales at constant exchange rates                                   |  |      | 29,065 |   |      |  | 29,306 |            |  |  | -0.8% | 
|Effect of changes in structure                                         |  |      |        |   |      |  | 561    |            |  |  |       | 
|Net sales on a constant structure basis and at constant exchange
rates |  |      | 29,065 |   |      |  | 29,867 |            |  |  | -2.7% | 



Our net sales are generated by our two principal operating segments: Pharmaceuticals and Human Vaccines (Vaccines). We do not consolidate
net sales from our Animal Health business; instead, Merials contribution to net income is reported separately on the line Net income from the held-for-exchange Merial business, in accordance with IFRS 5 (see Note D.8. to our
consolidated financial statements included at Item 18 of this annual report).



The following table breaks down our 2010 and 2009 net sales by business segment:



|                |  |               |        |  |               |  |        |                                |  |  |                                       |  |  |                                                                        |       |  |  |  |       | 
|--------------- |  | ------------- | ------ |  | ------------- |  | ------ | ------------------------------ |  |  | ------------------------------------- |  |  | ---------------------------------------------------------------------- | ----- |  |  |  | ----- | 
|( million)     |  | 2010
Reported |        |  | 2009
Reported |  |        | Change on a
reported basis (%) |  |  | Change at
constant
exchange rates (%) |  |  | Change on a
constant structure basis and at constant exchange
rates(%) |      
|Pharmaceuticals |  |               | 26,576 |  |               |  | 25,823 |                                |  |  | +2.9%                                 |  |  |                                                                        | -1.6% |  |  |  | -3.6% | 
|Vaccines        |  |               | 3,808  |  |               |  | 3,483  |                                |  |  | +9.3%                                 |  |  |                                                                        | +4.8% |  |  |  | +3.8% | 
|Total           |  |               | 30,384 |  |               |  | 29,306 |                                |  |  | +3.7%                                 |  |  |                                                                        | -0.8% |  |  |  | -2.7% | 



Net Sales by Product  Pharmaceuticals



Net sales generated by our Pharmaceuticals segment were
26,576 million in 2010, up 2.9% on a reported basis but down 1.6% at constant exchange rates.



Flagship Products



Our flagship products (Lantus® and other Diabetes division products,
Lovenox®, Plavix®, Taxotere®, Aprovel®/CoAprovel®, Eloxatine®, Multaq® and Jevtana®) are discussed below. Sales of
Plavix® and Aprovel® are discussed further below under  Worldwide Presence of Plavix® and Aprovel®.



Net sales for the Diabetes
division came to 4,298 million, up 9.2% at constant exchange rates, driven by growth for Lantus®,
Apidra® and Amaryl®.



Lantus®, the worlds leading insulin brand (source: IMS 2010 sales), posted a 9.1% rise in net sales at constant exchange rates in 2010 to 3,510 million.
Growth was strong in Emerging Markets (18.2% at constant exchange rates), but slowed in the United States (7.4% at constant exchange rates) due to healthcare reforms, despite higher sales of the SoloSTAR® injection pen. Lantus® achieved particularly strong growth at constant exchange rates in Japan (32.3%), Russia (25.9%), and Brazil (30.6%).



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Net sales of the rapid-acting insulin analog Apidra® advanced by 24.1% at constant exchange rates in 2010 to 177 million, buoyed by solid performances in
Western Europe (21.8% growth) and Emerging Markets (37.5% growth).



Lovenox®, the leading anti-thrombotic in the United States,
Germany, France, Italy, Spain and the United Kingdom (source: IMS 2010 sales), saw net sales fall by 10.5% at constant exchange rates in 2010 to 2,806 million. In the United States, sales fell by 22.7% to 1,439 million following the
introduction of a generic version of enoxaparin at the end of July 2010. As of the date of this document, we are aware of only one U.S. generic approved by the FDA although other ANDAs have been submitted. Excluding the United States, net sales were
up 7.8% at constant exchange rates at 1,367 million (representing 48.7% of wordlwide 2010 sales of
Lovenox®), with good performances in Western Europe (up 7.3%) and Eastern Europe (up 14.0%).



Taxotere® reported net sales of 2,122 million, down 6.4% at constant exchange rates. The drop in sales came in
the United States and Western Europe, where the patents expired in November 2010. Generic docetaxel became available throughout Western Europe by November 2010. In the United States, distributors commenced a work down of Taxotere® inventories in late 2010 in anticipation of the expected arrival of generic docetaxel in 2011. However, the product
saw modest growth in Emerging Markets and in the Other Countries region (1.4% and 2.5% respectively).



Net sales of Eloxatine® fell by 58.8% at constant exchange rates in 2010 to 427 million, hit by competition from generics. Following a court ruling, generics manufacturers
have been under order to stop selling their unauthorized Eloxatin® generics in the U.S. market since
June 30, 2010. Sun Pharmaceuticals has appealed this decision (see Note D.22.b) to our consolidated financial statements included at Item 18 of this annual report). The workdown of existing inventories of generics impaired our Eloxatine® sales performance in the second half of 2010.



Multaq®, which began to be marketed at the end of 2009, reported net sales of 172 million, mainly in the
United States. The product is now available in over 20 countries, and further launches are ongoing.



Jevtana®, which has been available in the U.S. market since July 2010, registered net sales of 82 million in 2010.



Our other major products are described below.



Net sales of the hypnotic Stilnox®/Ambien®/Myslee® fell by 10.9% at
constant exchange rates to 819 million. In the United States, net sales were 443 million (including 375 million for Ambien® CR), down 21.6% at constant exchange rates, following FDA approval of a generic version of Ambien® CR in October 2010; we responded by launching our own generic version in the United States. In Japan, Myslee®, the leading hypnotic on the market (source: IMS 2010 sales), again performed well, with net sales up 14.5% at constant exchange rates at 247 million.



Allegra® reported a 22.4% drop in net sales (at constant exchange rates) to 607 million, due to the effect of
generics of Allegra® D-12, which have been available on the U.S. market since the end of 2009. Sales in Japan
were down 2.0% at constant exchange rates, at 356 million.



Net sales of Copaxone®, generated mainly in Western Europe,
grew by 8.4% at constant exchange rates to 513 million.



The Consumer Health Carebusiness posted year-on-year growth of 45.7% at constant exchange rates to 2,217 million, driven by Emerging Markets where net sales rose by 44.4% at constant
exchange rates to 1,050 million. These figures consolidate the consumer health products of Zentiva from April 2009, Oenobiol from December 2009, Chattem from February 2010, and Nepentes from August 2010. On a constant structure basis and at
constant exchange rates, the division achieved sales growth of 6.9%, driven by Emerging Markets.



The Genericsbusiness reported 2010 net sales of 1,534 million, up 41.5% at constant exchange rates.
Growth was driven by Emerging Markets, due to the acquisition and consolidation of Zentiva and Kendrick (from April 2009) and Medley (from May 2009), and by the United States, following the launch of our generic version of Ambien®CR. On a constant structure basis and at constant exchange rates, the Generics division advanced by 18.5%, driven by
Emerging Markets.



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##### Table of Contents

Net sales of the other products in the portfolio were flat year-on-year at
6,064 million (up 0.3% on a constant structure basis and at constant exchange rates). For a description of our other pharmaceutical products, see Item 4. Information on the Company  B. Business Overview 
Pharmaceutical Products.



The following
table breaks down our 2010 and 2009 net sales for the Pharmaceuticals business by product:



|                          |  |            |                                                       |  |               |  |        |               |  |  |                                |  |  |                                       |         |  |                                                                      |  |         |  |  |  |         | 
|------------------------- |  | ---------- | ----------------------------------------------------- |  | ------------- |  | ------ | ------------- |  |  | ------------------------------ |  |  | ------------------------------------- | ------- |  | -------------------------------------------------------------------- |  | ------- |  |  |  | ------- | 
|( million)
Product       |  | Indication |                                                       |  | 2010
Reported |  |        | 2009
Reported |  |  | Change on
a reported
basis (%) |  |  | Change at
constant
exchange
rates (%) |         |  | Change on aconstant structurebasis and at
constant exchangerates (%) | 
|Lantus®                   |  |            | Diabetes                                              |  |               |  | 3,510  |               |  |  | 3,080                          |  |  |                                       | +14.0%  |  |                                                                      |  | +9.1%   |  |  |  | +9.1%   | 
|Apidra®                   |  |            | Diabetes                                              |  |               |  | 177    |               |  |  | 137                            |  |  |                                       | +29.2%  |  |                                                                      |  | +24.1%  |  |  |  | +24.1%  | 
|Amaryl®                   |  |            | Diabetes                                              |  |               |  | 478    |               |  |  | 416                            |  |  |                                       | +14.9%  |  |                                                                      |  | +7.7%   |  |  |  | +7.7%   | 
|Insuman®                  |  |            | Diabetes                                              |  |               |  | 133    |               |  |  | 131                            |  |  |                                       | +1.5%   |  |                                                                      |  | +1.5%   |  |  |  | +1.5%   | 
|Sub-total: Diabetes       |  |            |                                                       |  |               |  | 4,298  |               |  |  | 3,764                          |  |  |                                       | +14.2%  |  |                                                                      |  | +9.2%   |  |  |  | +9.2%   | 
|Lovenox®                  |  |            | Thrombosis                                            |  |               |  | 2,806  |               |  |  | 3,043                          |  |  |                                       | -7.8%   |  |                                                                      |  | -10.5%  |  |  |  | -10.5%  | 
|Plavix®                   |  |            | Atherothrombosis                                      |  |               |  | 2,083  |               |  |  | 2,623                          |  |  |                                       | -20.6%  |  |                                                                      |  | -24.6%  |  |  |  | -24.6%  | 
|Taxotere®                 |  |            | Breast, lung, prostate,stomach, and head &neck cancer |  |               |  | 2,122  |               |  |  | 2,177                          |  |  |                                       | -2.5%   |  |                                                                      |  | -6.4%   |  |  |  | -6.4%   | 
|Aprovel®/CoAprovel®       |  |            | Hypertension                                          |  |               |  | 1,327  |               |  |  | 1,236                          |  |  |                                       | +7.4%   |  |                                                                      |  | +4.2%   |  |  |  | +4.2%   | 
|Eloxatine®                |  |            | Colorectal cancer                                     |  |               |  | 427    |               |  |  | 957                            |  |  |                                       | -55.4%  |  |                                                                      |  | -58.8%  |  |  |  | -58.8%  | 
|Multaq®                   |  |            | Atrial fibrillation                                   |  |               |  | 172    |               |  |  | 25                             |  |  |                                       | +588.0% |  |                                                                      |  | +560.0% |  |  |  | +560.0% | 
|Jevtana®                  |  |            | Prostate cancer                                       |  |               |  | 82     |               |  |  |                               |  |  |                                       |        |  |                                                                      |  |        |  |  |  |        | 
|Stilnox®/Ambien® /Myslee® |  |            | Sleep disorders                                       |  |               |  | 819    |               |  |  | 873                            |  |  |                                       | -6.2%   |  |                                                                      |  | -10.9%  |  |  |  | -10.8%  | 
|Allegra®                  |  |            | Allergic rhinitis,urticaria                           |  |               |  | 607    |               |  |  | 731                            |  |  |                                       | -17.0%  |  |                                                                      |  | -22.4%  |  |  |  | -18.5%  | 
|Copaxone®                 |  |            | Multiple sclerosis                                    |  |               |  | 513    |               |  |  | 467                            |  |  |                                       | +9.9%   |  |                                                                      |  | +8.4%   |  |  |  | +11.0%  | 
|Tritace®                  |  |            | Hypertension                                          |  |               |  | 410    |               |  |  | 429                            |  |  |                                       | -4.4%   |  |                                                                      |  | -7.2%   |  |  |  | -5.2%   | 
|Dépakine®                 |  |            | Epilepsy                                              |  |               |  | 372    |               |  |  | 329                            |  |  |                                       | +13.1%  |  |                                                                      |  | +7.6%   |  |  |  | +7.6%   | 
|Xatral®                   |  |            | Benign prostatichypertrophy                           |  |               |  | 296    |               |  |  | 296                            |  |  |                                       | 0.0%    |  |                                                                      |  | -3.4%   |  |  |  | -3.1%   | 
|Actonel®                  |  |            | Osteoporosis, Pagetsdisease                          |  |               |  | 238    |               |  |  | 264                            |  |  |                                       | -9.8%   |  |                                                                      |  | -16.3%  |  |  |  | -16.3%  | 
|Nasacort®                 |  |            | Allergic rhinitis                                     |  |               |  | 189    |               |  |  | 220                            |  |  |                                       | -14.1%  |  |                                                                      |  | -16.8%  |  |  |  | -16.8%  | 
|Other products            |  |            |                                                       |  |               |  | 6,064  |               |  |  | 5,947                          |  |  |                                       | +2.0%   |  |                                                                      |  | -1.9%   |  |  |  | +0.3%   | 
|Consumer Health Care      |  |            |                                                       |  |               |  | 2,217  |               |  |  | 1,430                          |  |  |                                       | +55.0%  |  |                                                                      |  | +45.7%  |  |  |  | +6.9%   | 
|Generics                  |  |            |                                                       |  |               |  | 1,534  |               |  |  | 1,012                          |  |  |                                       | +51.6%  |  |                                                                      |  | +41.5%  |  |  |  | +18.5%  | 
|Total pharmaceuticals     |  |            |                                                       |  |               |  | 26,576 |               |  |  | 25,823                         |  |  |                                       | +2.9%   |  |                                                                      |  | -1.6%   |  |  |  | -3.6%   | 



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The following table breaks down net sales of our Pharmaceutical business products by
geographical region in 2010:



|                          |  |                 |       |  |                                   |  |        |               |  |  |                                   |   |  |                    |         |  |                                   |  |       |                    |  |  |                                   |  |  |  |       |  |  |  |         | 
|------------------------- |  | --------------- | ----- |  | --------------------------------- |  | ------ | ------------- |  |  | --------------------------------- | - |  | ------------------ | ------- |  | --------------------------------- |  | ----- | ------------------ |  |  | --------------------------------- |  |  |  | ----- |  |  |  | ------- | 
|( million) Product       |  | Western
Europe* |       |  | Change at
constant
exchange
rates |  |        | United
States |  |  | Change at
constant
exchange
rates |   |  | Emerging
Markets** |         |  | Change at
constant
exchange
rates |  |       | Other
countries*** |  |  | Change at
constant
exchange
rates | 
|Lantus®                   |  |                 | 684   |  |                                   |  | +5.3%  |               |  |  | 2,134                             |   |  |                    | +7.4%   |  |                                   |  | 508   |                    |  |  | +18.2%                            |  |  |  | 184   |  |  |  | +25.2%  | 
|Apidra®                   |  |                 | 68    |  |                                   |  | +21.8% |               |  |  | 62                                |   |  |                    | +11.1%  |  |                                   |  | 35    |                    |  |  | +37.5%                            |  |  |  | 12    |  |  |  | +150.0% | 
|Amaryl ®                  |  |                 | 42    |  |                                   |  | -17.6% |               |  |  | 6                                 |   |  |                    | -33.3%  |  |                                   |  | 222   |                    |  |  | +21.7%                            |  |  |  | 208   |  |  |  | +3.3%   | 
|Insuman®                  |  |                 | 108   |  |                                   |  | -0.9%  |               |  |  |                                  |   |  |                    |        |  |                                   |  | 25    |                    |  |  | +19.0%                            |  |  |  |      |  |  |  | -100.0% | 
|Sub-total: Diabetes       |  |                 | 902   |  |                                   |  | +4.2%  |               |  |  | 2,202                             |   |  |                    | +7.4%   |  |                                   |  | 790   |                    |  |  | +20.0%                            |  |  |  | 404   |  |  |  | +13.7%  | 
|Lovenox®                  |  |                 | 782   |  |                                   |  | +7.3%  |               |  |  | 1,439                             |   |  |                    | -22.7%  |  |                                   |  | 499   |                    |  |  | +6.9%                             |  |  |  | 86    |  |  |  | +19.4%  | 
|Plavix®                   |  |                 | 641   |  |                                   |  | -53.9% |               |  |  | 213                               | a |  |                    | -4.1%   |  |                                   |  | 648   |                    |  |  | +0.7%                             |  |  |  | 581   |  |  |  | +25.4%  | 
|Taxotere®                 |  |                 | 709   |  |                                   |  | -10.6% |               |  |  | 786                               |   |  |                    | -8.0%   |  |                                   |  | 394   |                    |  |  | +1.4%                             |  |  |  | 233   |  |  |  | +2.5%   | 
|Aprovel®/CoAprovel®       |  |                 | 825   |  |                                   |  | -5.0%  |               |  |  | 39                                | a |  |                    | +457.1% |  |                                   |  | 358   |                    |  |  | +8.3%                             |  |  |  | 105   |  |  |  | +67.3%  | 
|Eloxatine®                |  |                 | 46    |  |                                   |  | -42.9% |               |  |  | 172                               |   |  |                    | -76.4%  |  |                                   |  | 150   |                    |  |  | -9.8%                             |  |  |  | 59    |  |  |  | +4.0%   | 
|Multaq®                   |  |                 | 39    |  |                                   |  |       |               |  |  | 128                               |   |  |                    |        |  |                                   |  | 2     |                    |  |  |                                  |  |  |  | 3     |  |  |  |        | 
|Jevtana®                  |  |                 |      |  |                                   |  |       |               |  |  | 82                                |   |  |                    |        |  |                                   |  |      |                    |  |  |                                  |  |  |  |      |  |  |  |        | 
|Stilnox®/Ambien® /Myslee® |  |                 | 55    |  |                                   |  | -8.3%  |               |  |  | 443                               |   |  |                    | -21.6%  |  |                                   |  | 68    |                    |  |  | +5.0%                             |  |  |  | 253   |  |  |  | +13.6%  | 
|Allegra®                  |  |                 | 16    |  |                                   |  | -5.9%  |               |  |  | 147                               |   |  |                    | -53.6%  |  |                                   |  | 88    |                    |  |  | +17.4%                            |  |  |  | 356   |  |  |  | -3.2%   | 
|Copaxone®                 |  |                 | 482   |  |                                   |  | +9.1%  |               |  |  |                                  |   |  |                    |        |  |                                   |  | 13    |                    |  |  | -13.3%                            |  |  |  | 18    |  |  |  | +7.7%   | 
|Tritace®                  |  |                 | 189   |  |                                   |  | -4.1%  |               |  |  |                                  |   |  |                    |        |  |                                   |  | 191   |                    |  |  | -2.6%                             |  |  |  | 30    |  |  |  | -41.9%  | 
|Depakine®                 |  |                 | 148   |  |                                   |  | +2.1%  |               |  |  |                                  |   |  |                    |        |  |                                   |  | 209   |                    |  |  | +12.0%                            |  |  |  | 15    |  |  |  | +9.1%   | 
|Xatral®                   |  |                 | 66    |  |                                   |  | -14.3% |               |  |  | 155                               |   |  |                    | +2.7%   |  |                                   |  | 70    |                    |  |  | +0.0%                             |  |  |  | 5     |  |  |  | -50.0%  | 
|Actonel®                  |  |                 | 104   |  |                                   |  | -23.5% |               |  |  |                                  |   |  |                    |        |  |                                   |  | 93    |                    |  |  | -12.4%                            |  |  |  | 41    |  |  |  | +3.2%   | 
|Nasacort®                 |  |                 | 28    |  |                                   |  | -3.4%  |               |  |  | 130                               |   |  |                    | -20.3%  |  |                                   |  | 26    |                    |  |  | -10.7%                            |  |  |  | 5     |  |  |  | -20.0%  | 
|Other products            |  |                 | 2,649 |  |                                   |  | -2.3%  |               |  |  | 652                               |   |  |                    | +3,3%   |  |                                   |  | 2,052 |                    |  |  | +0.4%                             |  |  |  | 711   |  |  |  | -10.9%  | 
|Consumer Health Care      |  |                 | 630   |  |                                   |  | +1.1%  |               |  |  | 320                               |   |  |                    |        |  |                                   |  | 1,050 |                    |  |  | +44.4%                            |  |  |  | 217   |  |  |  | +31.3%  | 
|Generics                  |  |                 | 404   |  |                                   |  | +11.1% |               |  |  | 102                               |   |  |                    |        |  |                                   |  | 988   |                    |  |  | +42.8%                            |  |  |  | 40    |  |  |  | +61.9%  | 
|Total pharmaceuticals     |  |                 | 8,715 |  |                                   |  | -8.5%  |               |  |  | 7,010                             |   |  |                    | -7,5%   |  |                                   |  | 7,689 |                    |  |  | +11.9%                            |  |  |  | 3,162 |  |  |  | +6.9%   | 



|* | France, Germany, United Kingdom, Italy, Spain, Greece, Cyprus, Malta, Belgium, Luxembourg,
Portugal, Netherlands, Austria, Switzerland, Sweden, Ireland, Finland, Norway, Iceland, Denmark.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|** | World excluding United States, Canada, Western Europe, Japan, Australia and New Zealand.
|-- | ----------------------------------------------------------------------------------------

|*** | Japan, Canada, Australia and New Zealand.
|--- | -----------------------------------------

|a | Sales of active ingredient to the entity majority-owned by BMS in the United States.
|- | ------------------------------------------------------------------------------------



Net Sales 
Human Vaccines (Vaccines)



In 2010, the
Vaccines segment reported net sales of 3,808 million, up 4.8% at constant exchange rates and 9.3% on a reported basis. Growth was driven by sales of seasonal influenza vaccines (845 million, versus 597 million in 2009).
Sales of pandemic influenza vaccines (mainly against the A/H1N1 virus) were flat; excluding their impact, growth for the Vaccines segment reached 5.5% at constant exchange rates.



Although the Vaccines segment saw net sales fall in Western
Europe and the United States (by 15.6% and 11.5% at constant exchange rates, respectively), the effect was amply offset by strong growth in Emerging Markets and in the Other Countries region (of 46.2% and 23.0% at constant exchange rates,
respectively).



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Net sales of influenza vaccines rose by 18.7% at constant
exchange rates to 1,297 million in 2010, boosted by the performance of the Fluzone® seasonal
influenza vaccine in the U.S. market. Excluding pandemic influenza vaccines (net sales of 452 million, flat year-on-year), growth reached 33.3% at constant exchange rates.



Polio/Pertussis/Hibvaccines net sales fell by 2.9% (at constant exchange rates) to
984 million, reflecting a decline in sales of Pentacel® (down 11.4% at 317 million at
constant exchange rates) but also the performance of Pentaxim® (up 43.9% at 190 million at constant
exchange rates).



Meningitis/Pneumoniavaccines generated net sales of 527 million, down 6.7% at constant exchange
rates, mainly due to a reduction in catch-up vaccination programs with the Menactra® quadrivalent meningococcal
meningitis vaccine in the United States.



Net sales of Adult boostervaccines reached 449 million (up 4.7% at constant exchange rates), driven by Adacel® (301 million, up 6.1% at constant exchange rates).



Net sales of Travel and other endemics Vaccines rose by 15.7% at constant exchange rates to 382 million, mainly due to
growth in anti-rabies vaccines.



The following
table presents the 2010 sales of our Vaccines activity by range of products:



|                                                                 |  |               |       |  |               |  |       |                                |  |  |                                       |  |  |  |         | 
|---------------------------------------------------------------- |  | ------------- | ----- |  | ------------- |  | ----- | ------------------------------ |  |  | ------------------------------------- |  |  |  | ------- | 
|( million)                                                      |  | 2010
Reported |       |  | 2009
Reported |  |       | Change on
a reported
basis (%) |  |  | Change at
constant
exchange
rates (%) | 
|Influenza Vaccines (including Vaxigrip®
and Fluzone®)            |  |               | 1,297 |  |               |  | 1,062 |                                |  |  | +22.1 %                               |  |  |  | +18.7 % | 
| of which seasonal influenza vaccines                           |  |               | 845   |  |               |  | 597   |                                |  |  | +41.5 %                               |  |  |  | +33.3 % | 
| of which pandemic influenza vaccines                           |  |               | 452   |  |               |  | 465   |                                |  |  | -2.8 %                                |  |  |  | +0.0 %  | 
|Polio/Pertussis/Hib Vaccines (including
Pentacel® and Pentaxim®) |  |               | 984   |  |               |  | 968   |                                |  |  | +1.7 %                                |  |  |  | -2.9 %  | 
|Meningitis/Pneumonia Vaccines (including
Menactra®)              |  |               | 527   |  |               |  | 538   |                                |  |  | -2.0 %                                |  |  |  | -6.7 %  | 
|Adult Booster Vaccines (including
Adacel®)                       |  |               | 449   |  |               |  | 406   |                                |  |  | +10.6 %                               |  |  |  | +4.7 %  | 
|Travel and Other Endemics Vaccines                               |  |               | 382   |  |               |  | 313   |                                |  |  | +22.0 %                               |  |  |  | +15.7 % | 
|Other Vaccines                                                   |  |               | 169   |  |               |  | 196   |                                |  |  | +13.8 %                               |  |  |  | -18.4 % | 
|Total Vaccines                                                   |  |               | 3,808 |  |               |  | 3,483 |                                |  |  | +9.3 %                                |  |  |  | +4.8 %  | 





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The following table presents the 2010 sales of our Vaccines business by range of products
and by region:



|                                                            |  |                          |     |  |                                   |  |         |                        |  |  |                                   |  |  |                             |        |  |                                   |  |       |                             |  |  |                                   |  |  |  |     |  |  |  |        | 
|----------------------------------------------------------- |  | ------------------------ | --- |  | --------------------------------- |  | ------- | ---------------------- |  |  | --------------------------------- |  |  | --------------------------- | ------ |  | --------------------------------- |  | ----- | --------------------------- |  |  | --------------------------------- |  |  |  | --- |  |  |  | ------ | 
|( million)                                                 |  | Western
Europe*
Reported |     |  | Change at
constant
exchange
rates |  |         | United
States
Reported |  |  | Change at
constant
exchange
rates |  |  | Emerging
Markets**
Reported |        |  | Change at
constant
exchange
rates |  |       | Other
countries***
Reported |  |  | Change at
constant
exchange
rates | 
|Influenza Vaccinesa
(inc.
Vaxigrip® and Fluzone®)           |  |                          | 128 |  |                                   |  | -7.9 %  |                        |  |  | 528                               |  |  |                             | -20.2% |  |                                   |  | 618   |                             |  |  | +116.4%                           |  |  |  | 23  |  |  |  | +5.6%  | 
|Polio/Pertussis.Hib Vaccines
(inc.
Pentacel® and Pentaxim®) |  |                          | 61  |  |                                   |  | -16.2 % |                        |  |  | 470                               |  |  |                             | -14.6% |  |                                   |  | 384   |                             |  |  | +11.4%                            |  |  |  | 69  |  |  |  | +56.4% | 
|Meningitis/Pneumonia Vaccines
(inc.
Menactra®)              |  |                          | 5   |  |                                   |  | -54.5 % |                        |  |  | 407                               |  |  |                             | -11.4% |  |                                   |  | 101   |                             |  |  | +25.6%                            |  |  |  | 14  |  |  |  | +0.0%  | 
|Adult Booster Vaccines
(inc.
Adacel®)                       |  |                          | 54  |  |                                   |  | -3.6 %  |                        |  |  | 345                               |  |  |                             | +5.2%  |  |                                   |  | 33    |                             |  |  | +32.0%                            |  |  |  | 17  |  |  |  | -20.0% | 
|Travel and Other Endemics Vaccines                          |  |                          | 18  |  |                                   |  | +20.0 % |                        |  |  | 80                                |  |  |                             | +11.6% |  |                                   |  | 235   |                             |  |  | +15.8%                            |  |  |  | 49  |  |  |  | +21.2% | 
|Other Vaccines                                              |  |                          | 16  |  |                                   |  | -63.2 % |                        |  |  | 128                               |  |  |                             | -10.4% |  |                                   |  | 15    |                             |  |  | +0.0%                             |  |  |  | 10  |  |  |  | +22.2% | 
|Total Vaccines                                              |  |                          | 282 |  |                                   |  | -15.6 % |                        |  |  | 1,958                             |  |  |                             | -11.5% |  |                                   |  | 1,386 |                             |  |  | +46.2%                            |  |  |  | 182 |  |  |  | +23.0% | 





|* | France, Germany, United Kingdom,
Italy, Spain, Greece, Cyprus, Malta, Belgium, Luxembourg, Portugal, Netherlands, Austria, Switzerland, Sweden, Ireland, Finland, Norway, Iceland, Denmark.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|** | World
excluding United States, Canada, Western Europe, Japan, Australia and New Zealand.
|-- | ----------------------------------------------------------------------------------------

|*** | Japan,
Canada, Australia and New Zealand.
|--- | -----------------------------------------

|a | Seasonal and pandemic influenza
vaccines.
|- | -----------------------------------------



In addition to the Vaccines activity reflected in our consolidated net sales, sales at Sanofi Pasteur MSD, our joint venture with Merck & Co., Inc. in Western Europe, amounted to
918 million, down 18.9% on a reported basis. Sales of Gardasil®, a vaccine that prevents
papillomavirus infections (a cause of cervical cancer), totaled 263 million in 2010, compared with 395 million in 2009. This fall of 33.5% was mainly due to a reduction in catch-up vaccination programs.



Sales generated by Sanofi Pasteur MSD are not included in our
consolidated net sales.



Net Sales 
Animal Health



The Animal Health business is
conducted through Merial, which has been a wholly-owned subsidiary of sanofi-aventis since September 18, 2009. In March 2010, we exercised our option to combine Merial and Intervet/Schering-Plough in a new 50/50 joint venture with Merck in
2011. Consequently, Merials profit contribution is reported on the line Net income from the held-for-exchange Merial business, in accordance with IFRS 5 (see Note D.8. to our consolidated financial statements included at
Item 18 of this annual report), and Merials net sales are not consolidated by sanofi-aventis.



Merial generated net sales of $2,635 million in 2010, up 2.6% at constant exchange rates and 3.2% on a reported basis.
Net sales for the companion animals franchise increased by 1.4% at constant exchange rates (1.7% on a reported basis) to $1,707 million, as growth for the Frontline® range in the United States more than offset the impact of generics of Frontline® in Europe. The production animals franchise performed well, growing by 5.0% at constant exchange rates (6.1% on a reported basis) to $928 million.



|                                             |  |               |       |  |               |  |       |                                   |  |  |       | 
|-------------------------------------------- |  | ------------- | ----- |  | ------------- |  | ----- | --------------------------------- |  |  | ----- | 
|($ million)                                  |  | 2010
Reported |       |  | 2009
Reported |  |       | Change at constant
exchange rates | 
|Frontline® and other fipronil-based
products |  |               | 1,027 |  |               |  | 996   |                                   |  |  | +2.4% | 
|Vaccines                                     |  |               | 837   |  |               |  | 794   |                                   |  |  | +5.5% | 
|Avermectin                                   |  |               | 473   |  |               |  | 475   |                                   |  |  | -2.8% | 
|Other                                        |  |               | 298   |  |               |  | 289   |                                   |  |  | +4.8% | 
|Total                                        |  |               | 2,635 |  |               |  | 2,554 |                                   |  |  | +2.6% | 



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##### Table of Contents

Net Sales by Geographic Region



We divide our sales geographically into four regions:
Western Europe, the United States, Emerging Markets and other countries. The following table breaks down our 2010 and 2009 net sales by region:



|                                        |  |               |        |  |               |  |        |                            |  |  |                                   |  |  |  |        | 
|--------------------------------------- |  | ------------- | ------ |  | ------------- |  | ------ | -------------------------- |  |  | --------------------------------- |  |  |  | ------ | 
|( million)                             |  | 2010
Reported |        |  | 2009
Reported |  |        | Change on a
Reported basis |  |  | Change at constant
exchange rates | 
|Western Europe*                         |  |               | 8,997  |  |               |  | 9,793  |                            |  |  | -8.1%                             |  |  |  | -8.8%  | 
|United States                           |  |               | 8,968  |  |               |  | 9,426  |                            |  |  | -4.9%                             |  |  |  | -8.4%  | 
|Emerging Markets**                      |  |               | 9,075  |  |               |  | 7,356  |                            |  |  | +23.4%                            |  |  |  | +16.3% | 
|Of which Eastern Europe and Turkey      |  |               | 2,612  |  |               |  | 2,266  |                            |  |  | +15.3%                            |  |  |  | +10.0% | 
|Of which Asia (excl. Pacific region***) |  |               | 1,983  |  |               |  | 1,610  |                            |  |  | +23.2%                            |  |  |  | +14.2% | 
|Of which Latin America                  |  |               | 2,735  |  |               |  | 1,913  |                            |  |  | +43.0%                            |  |  |  | +32.4% | 
|Of which Africa                         |  |               | 846    |  |               |  | 775    |                            |  |  | +9.2%                             |  |  |  | +4.0%  | 
|Of which Middle East                    |  |               | 789    |  |               |  | 647    |                            |  |  | +21.9%                            |  |  |  | +19.6% | 
|Other Countries****                     |  |               | 3,344  |  |               |  | 2,731  |                            |  |  | +22.4%                            |  |  |  | +7.7%  | 
|Of which Japan                          |  |               | 2,225  |  |               |  | 1,844  |                            |  |  | +20.7%                            |  |  |  | +9.1%  | 
|Total                                   |  |               | 30,384 |  |               |  | 29,306 |                            |  |  | +3.7%                             |  |  |  | -0.8%  | 



|* | France, Germany, United Kingdom, Italy, Spain, Greece, Cyprus, Malta, Belgium, Luxembourg,
Portugal, Netherlands, Austria, Switzerland, Sweden, Ireland, Finland, Norway, Iceland, Denmark.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|** | World excluding United States, Canada, Western Europe, Japan, Australia and New Zealand.
|-- | ----------------------------------------------------------------------------------------

|*** | Japan, Australia and New Zealand.
|--- | ---------------------------------

|**** | Japan, Canada, Australia and New Zealand.
|---- | -----------------------------------------



Western Europe saw net sales fall by 8.8%
at constant exchange rates in 2010 to 8,997 million, hit by competition from generics of Plavix® and
Taxotere®, and by price pressure from the healthcare authorities.



In the United States, net sales were 8.4%
lower at constant exchange rates at 8,968 million (11.1% lower on a constant structure basis and at constant exchange rates), reflecting the arrival of generic competition for Lovenox® and Ambien® CR, plus the
workdown of inventories of generic versions of Eloxatine® during the second half of 2010 and the effects of
healthcare reform. These figures include net sales generated by Chattem from February 2010.



Emerging Markets net sales were 9,075 million, representing robust growth of 16.3% at constant exchange rates. This performance reflected solid organic growth (13.2% on a constant structure
basis and at constant exchange rates), and the impact of acquisitions (primarily Zentiva in Eastern Europe and Medley in Brazil). Emerging Markets accounted for 29.9% of total consolidated net sales in 2010. The main growth drivers were Latin
America, Russia and China, which achieved growth at constant exchange rates of 32.4% (to 2,735 million), 19.9% (to 654 million) and 23.6% (to 667 million), respectively. In Latin America (primarily Brazil and Mexico), growth was
fueled by sales of influenza vaccines, which virtually trebled (189% growth).



In the Other Countries region, net sales rose by 7.7% at constant exchange rates to 3,344 million. Net sales in Japan reached 2,225 million, up 9.1% at constant exchange rates, thanks
largely to the success of Plavix® and the performance of the Vaccines business.



Worldwide Presence of Plavix® and Aprovel®



Two of our leading products  Plavix® and Aprovel®  were
discovered by sanofi-aventis and jointly developed with Bristol-Myers Squibb (BMS) under an alliance agreement. In all territories except Japan, these products are sold either by sanofi-aventis or by BMS in accordance with the terms of
this alliance agreement which is described in  Financial Presentation of Alliances  Alliance arrangements with Bristol-Myers Squibb above.



Worldwide sales of these two products are an important
indicator because they facilitate a financial statement users understanding and analysis of our consolidated income statement, particularly in terms of



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understanding our overall profitability in relation to consolidated revenues, and also facilitate a users ability to understand and assess the effectiveness of our research and development
efforts.



Also, disclosing sales made by BMS of
these two products enables the users to have a clearer understanding of trends in different lines of our income statement, in particular the lines Other revenues, where we record royalties received on those sales (see  Other
Revenues); Share of profit/loss of associates and joint ventures (see  Share of Profit/Loss of Associates and Joint Ventures), where we record our share of profit/loss of entities included in the BMS Alliance and
under BMS operational management; and Net income attributable to non-controlling interests (see  Net Income Attributable to Non-Controlling Interests), where we record the BMS share of profit/loss of entities included
in the BMS Alliance and under our operational management.



The table below sets forth the worldwide sales of Plavix® and
Aprovel® in 2010 and 2009, by geographic region:



|                                       |  |                    |       |  |        |  |       |                           |  |  |                                   |  |  |        |       |  |       |  |       |  |  |  |       |  |  |  |        |  |  |  |        | 
|-------------------------------------- |  | ------------------ | ----- |  | ------ |  | ----- | ------------------------- |  |  | --------------------------------- |  |  | ------ | ----- |  | ----- |  | ----- |  |  |  | ----- |  |  |  | ------ |  |  |  | ------ | 
|( million)                            |  | 2010               |       |  | 2009   |  |       | Change on
a reportedbasis |  |  | Change at
constant
exchange
rates | 
|                                       |  | sanofi-
aventis(2) |       |  | BMS(3) |  |       | Total                     |  |  | sanofi-
aventis(2)                |  |  | BMS(3) |       |  | Total |  |       | 
|Plavix®/Iscover
® (1)                  |  |                    |       |  |        |  |       |                           |  |  |                                   |  |  |        |       |  |       |  |       |  |  |  |       |  |  |  |        |  |  |  |        | 
|Europe                                 |  |                    | 724   |  |        |  | 98    |                           |  |  | 822                               |  |  |        | 1,443 |  |       |  | 161   |  |  |  | 1,604 |  |  |  | -48.8% |  |  |  | -49.2% | 
|United States                          |  |                    |      |  |        |  | 4,626 |                           |  |  | 4,626                             |  |  |        |      |  |       |  | 4,026 |  |  |  | 4,026 |  |  |  | +14.9% |  |  |  | +10.8% | 
|Other countries                        |  |                    | 1,165 |  |        |  | 282   |                           |  |  | 1,447                             |  |  |        | 897   |  |       |  | 255   |  |  |  | 1,152 |  |  |  | +25.6% |  |  |  | +13.7% | 
|Total                                  |  |                    | 1,889 |  |        |  | 5,006 |                           |  |  | 6,895                             |  |  |        | 2,340 |  |       |  | 4,442 |  |  |  | 6,782 |  |  |  | +1.7%  |  |  |  | -2.9%  | 
|Aprovel®/Avapro®
/Karvea®/Avalide® (4) |  |                    |       |  |        |  |       |                           |  |  |                                   |  |  |        |       |  |       |  |       |  |  |  |       |  |  |  |        |  |  |  |        | 
|Europe                                 |  |                    | 789   |  |        |  | 158   |                           |  |  | 947                               |  |  |        | 810   |  |       |  | 172   |  |  |  | 982   |  |  |  | -3.6%  |  |  |  | -4.4%  | 
|United States                          |  |                    |      |  |        |  | 482   |                           |  |  | 482                               |  |  |        |      |  |       |  | 524   |  |  |  | 524   |  |  |  | -8.0%  |  |  |  | -10.4% | 
|Other countries                        |  |                    | 411   |  |        |  | 216   |                           |  |  | 627                               |  |  |        | 314   |  |       |  | 192   |  |  |  | 506   |  |  |  | +23.9% |  |  |  | +13.5% | 
|Total                                  |  |                    | 1,200 |  |        |  | 856   |                           |  |  | 2,056                             |  |  |        | 1,124 |  |       |  | 888   |  |  |  | 2,012 |  |  |  | +2.2%  |  |  |  | -1.5%  | 



|(1) | Plavix® is marketed under the
trademarks Plavix® and Iscover®.
|--- | --------------------------------------------------------------

|(2) | Net sales of Plavix® consolidated by sanofi-aventis, excluding sales to BMS (273 million in 2010 and 311 million in 2009).
|--- | ----------------------------------------------------------------------------------------------------------------------------

|(3) | Translated into euros by sanofi-aventis using the method described in Note B.2.
Foreign currency translation to our consolidated financial statements included at Item 18 in this annual report.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Aprovel® is marketed under the
trademarks Aprovel®, Avapro®, Karvea® and Avalide®.
|--- | ----------------------------------------------------------------------------------

|(5) | Net sales of Aprovel® consolidated by sanofi-aventis, excluding sales to BMS (129 million in 2010 and 113 million in 2009).
|--- | -----------------------------------------------------------------------------------------------------------------------------



In the United States, sales of Plavix®/Iscover® (consolidated by BMS) grew by a robust 10.8% in 2010 to 4,626 million. Plavix® continued to perform well in Japan and China, where sales grew respectively by 37.1% (to 520 million) and by 36.6% (to 216 million) at constant exchange
rates. These performances to some extent cushioned the effect of the decline in European sales of Plavix® (down
49.2% at constant exchange rates) caused by competition from generics.



Worldwide sales of Aprovel®/Avapro®/Karvea®/Avalide® were
2,056 million in 2010, down 1.5% at constant exchange rates. The performance in the Other Countries region, lifted by sales of active ingredient to our alliance partners in Japan, partially offset the drop in sales in the United States
and Europe, where net sales fell by 10.4% and 4.4% respectively at constant exchange rates. At the end of 2010, sales were impacted by a voluntary recall of certain lots of Avalide® (irbesartan-hydrochlorothiazide) by Bristol-Myers Squibb and sanofi-aventis from the U.S., Puerto Rican, Canadian, Mexican and Argentinean markets.



Other Revenues



Other revenues, which mainly comprise royalty income under
licensing agreements contracted in connection with ongoing operations, totaled 1,651 million in 2010, 14.4% higher than the 2009 figure of 1,443 million.



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This increase was mainly due to license revenues under the worldwide
alliance with BMS on Plavix® and Aprovel®, which totaled 1,303 million in 2010 versus 1,155 million in 2009 (a 12.8% rise on a reported basis). These revenues were boosted by stronger
sales of Plavix® in the United States (up 10.8% at constant exchange rates), and by favorable trends in the
exchange rate of the U.S. dollar against the euro.



Gross Profit



Gross profit for the year ended December 31, 2010 came to 23,318 million (76.7% of net sales), 2.0% up on the 2009 figure
of 22,869 million (78.0% of net sales).



The gross margin ratio of the Pharmaceuticals segment fell by 1.6 points, reflecting the net effect of increased royalty income (+0.6 of a point) and erosion in the ratio of cost of sales to net sales
(-2.2 points). This erosion was mainly due to genericization (primarily Plavix® in Europe and Lovenox® in the United States) and higher raw material prices for heparins.



Nevertheless, the 2010 gross margin ratio for the
Pharmaceuticals segment remained healthy at 78.6%.



The gross margin ratio of the Vaccines segment rose by 1.9 points to 64.7%, driven by a 2.1-point improvement in the ratio of cost of
sales to net sales, thanks mainly to cost efficiencies in the production of pandemic influenza vaccines.



Consolidated gross profit was also dented by a 30 million charge (0.1 of a point) arising from the workdown during 2010 of
inventories remeasured at fair value in connection with acquisitions (principally Chattem).



Research and Development Expenses



Research and development expenses amounted to 4,401 million in 2010 (14.5% of net sales), compared with 4,583 million in 2009 (15.6% of net sales). This represents a year-on-year
reduction of 4.0% on a reported basis and 6.2% at constant exchange rates.



The Pharmaceuticals segment generated savings of 7.1% at constant exchange rates as a result of the reorganization initiated in 2009, which has helped reorient some in-house resources towards third-party
collaborations. These savings also reflect a rationalization of R&D projects following a full, objective review of the portfolio.



Research and development expenses in the Vaccines segment rose by 26 million year-on-year, an increase of 1.8% at constant
exchange rates.



Selling and General Expenses



Selling and general
expenses amounted to 7,567 million (24.9% of net sales), an increase of 3.3% on the prior-year figure of 7,325 million (25.0% of net sales). At constant exchange rates, selling and general expenses fell by 1.2%, despite the
first-time consolidation of companies acquired in 2010 (primarily Chattem) and the impact of the Jevtana® and
Multaq® launches. This reduction reflects the transformation program initiated in 2009, and was mainly driven by
savings in marketing costs in the United States and Europe, and in general expenses.



Other Operating Income and Expenses



Other operating income amounted to 359 million in 2010 (2009: 866 million), and other operating expenses totaled 276 million (2009: 481 million).



Overall, other operating income and
expenses represented net income of 83 million in 2010, compared with 385 million in 2009. The year-on-year fall of 302 million was mainly due to the discontinuation of royalty payments from Teva on North American
sales of Copaxone® from the second quarter of 2010.



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In addition, sanofi-aventis recorded a net operational foreign exchange loss of
141 million due to highly volatile currency markets; this compares with a net gain of 40 million in 2009.



Amortization of Intangible Assets



Amortization charged against intangible assets in the year ended December 31, 2010 amounted to 3,529 million, compared
with 3,528 million in the previous year. An increase in amortization expense in North America, related to trends in the U.S. dollar/euro exchange rate and the Chattem acquisition, was offset by a reduction in Europe as some intangible
assets reached the end of their useful lives.



This line item mainly comprises amortization charged against intangible assets remeasured at fair value on the acquisitions of Aventis
(3,070 million in 2010, versus 3,175 million in 2009) and of Zentiva (130 million in 2010, versus 98 million in 2009).



Impairment of Intangibles Assets



This line recorded impairment losses of 433 million in 2010, compared with 372 million in 2009.
The losses booked in 2010 related mainly to (i) Actonel®, due to contemplated amendments to the terms of
the collaboration agreement with Warner Chilcott; (ii) the pentavalent vaccine Shan5®, for which sales
projections were revised to take account of the need to file a new application for WHO pre-qualification following a flocculation problem in some batches; (iii) the BSI-201 project, for which the development plan was revised following the
announcement of the initial results from a Phase III trial in triple-negative metastatic breast cancer; and (iv) some of Zentivas generics and consumer health products, whose sales projections in Eastern Europe were adjusted downwards.



The net impairment loss of
372 million recognized in 2009 related mainly to Actonel®, Benzaclin® and Nasacort®, and reflected the changing competitive environment and the approval dates of generics.



Restructuring Costs



Restructuring costs amounted to 1,372 million in
2010, compared with 1,080 million in 2009.



In 2010, these costs related mainly to measures taken to adapt our industrial operations in France, and our sales and R&D functions in the United States and some European countries.



In 2009, restructuring costs related mainly to measures aimed
at transforming R&D operations to encourage innovation, and adapting central support functions to streamline the organizational structure. They mainly comprised employee-related expenses, in the form of early retirement benefits and termination
benefits under voluntary redundancy plans. To a lesser extent, they reflected ongoing measures to adapt our industrial facilities in Europe and adjust our sales forces.



Gains and Losses on Disposals, and Litigation



In 2010, this line item reported an expense
of 138 million, relating to an adjustment to vendors guarantee provisions in connection with past divestments.



We made no material divestments in 2010 or 2009.



Operating Income



Operating income for 2010 was 5,961 million, versus 6,366 million for 2009, a drop of 6.4%.



Financial Income and Expenses



Net financial expenses were 362 million in 2010,
compared with 300 million in 2009, an increase of 20.7%.



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Financial expenses directly related to net debt (defined as short-term and long-term debt,
plus related interest rate and currency derivatives, minus cash and cash equivalents) were 397 million in 2010, versus 230 million in 2009. This year-on-year rise reflected the following factors:



| |  |  | an increase in the average interest rate (due to a longer average maturity), charged on a higher level of average consolidated debt;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------



| |  |  | a reduction in interest income, reflecting a lower average rate of return; and
| | - |  | ------------------------------------------------------------------------------



| |  |  | the 34 million of financial expenses incurred on the acquisition credit facilities contracted in October 2010 in connection with the launch
of the public tender offer for Genzyme (see Item 8.B. Significant changes).
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Gains on disposals amounted to 61 million, mainly on the sale of the equity interest in Novexel.



Net foreign exchange losses on financial items totaled
20 million in 2010 (2009: 67 million).



Income before Tax and Associates and Joint Ventures



Income before tax and associates and joint ventures was 5,599 million in 2010, versus 6,066 million in 2009, a fall
of 7.7%.



Income Tax Expense



Income tax expense totaled 1,242 million in 2010,
compared with 1,364 million in 2009.



The effective tax rate is calculated on the basis of business operating income minus net financial expenses and before the share of
profit/loss of associates and joint ventures, net income from the held-for-exchange Merial business, and net income attributable to non-controlling interests. The effective tax rate was 27.8% in 2010, versus 28.0% in 2009. The difference relative to
the standard income tax rate applicable in France (34%) was mainly due to royalty income being taxed at a reduced rate in France.



This line item also includes tax effects of amortization of intangible assets (1,181 million in 2010, 1,126 million in
2009) and of restructuring costs (462 million in 2010, 360 million in 2009).



Share of Profit/Loss of Associates and Joint Ventures



Our share of profits and losses from associates and joint ventures was 978 million in 2010, compared with
814 million in 2009. This line mainly includes our share of after-tax profits from territories managed by BMS under the Plavix® and Avapro® alliance, which
rose by 24.8% from 785 million in 2009 to 980 million in 2010. This year-on-year increase was mainly related to stronger sales of Plavix® in the United States (up 10.8% at constant exchange rates) and to the appreciation of the U.S. dollar against the euro (positive impact of 3.7%).



Net Income from the Held-for-Exchange Merial Business



With effect from September 18, 2009,
the date on which we obtained exclusive control over Merial, the operations of this company have been accounted for using the full consolidation method. In accordance with IFRS 5, the results of Merials operations are reported separately
in the line item Net income from the held-for-exchange Merial business (see Note D.8.1. to our consolidated financial statements included at Item 18 of this annual report).



Net income from the held-for-exchange Merial business amounted to 386 million, compared with
175 million in 2009. The increase mainly reflects the fact that since September 18, 2009, this line has included 100% of Merials net income, against 50% previously. The figure reported also includes the impact of the workdown
of inventories remeasured at fair value in September 2009.



Net Income



Net income for the year was 5,721 million in 2010, compared with 5,691 million in 2009.



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##### Table of Contents

Net Income Attributable to Non-Controlling Interests



Net income attributable to
non-controlling interests amounted to 254 million in 2010, compared with 426 million in 2009. This line mainly comprises the share of pre-tax profits paid to BMS from territories managed by sanofi-aventis (238 million,
versus 405 million in 2009). The decrease in Net income attributable to non-controlling interests in 2010 was directly related to increased competition from generics of clopidogrel
(Plavix®) in Europe.



Net Income Attributable to Equity Holders of Sanofi-Aventis



Net income attributable to equity holders of sanofi-aventis
totaled 5,467 million in 2010, against 5,265 million in 2009.



Basic earnings per share for 2010 was 4.19, 4.0% higher than the 2009 figure of 4.03, based on an average number of shares outstanding of 1,305.3 million in 2010 and 1,305.9 million
in 2009. Diluted earnings per share was 4.18 in 2010 compared with 4.03 in 2009, based on an average number of shares outstanding after dilution of 1,308.2 million in 2010 and 1,307.4 million in 2009.



Business Operating Income



Business operating income for 2010 was
12,660 million, compared to 12,028 million in 2009. The table below shows trends in business operating income by business segment for 2010 and 2009:



|                          |  |      |        |  |      |  |        | 
|------------------------- |  | ---- | ------ |  | ---- |  | ------ | 
|( million)               |  | 2010 |        |  | 2009 | 
|Pharmaceuticals           |  |      | 10,965 |  |      |  | 10,608 | 
|Vaccines                  |  |      | 1,379  |  |      |  | 1,173  | 
|Other                     |  |      | 316    |  |      |  | 247    | 
|Business operating income |  |      | 12,660 |  |      |  | 12,028 | 



Business Net Income



Business net income is a non-GAAP financial measure that we use to evaluate our Groups performance (see Item 5. Operating and
Financial Review and Prospects  Business Net Income above).



Business net income for 2010 was 9,215 million, an improvement of 6.8% on the 2009 figure of 8,629 million, and represented 30.3% of net sales compared with 29.4% in 2009. The
increase was mainly due to our good operating performance, reflected in the increase in gross profit (23,318 million in 2010 versus 22,869 million in 2009).



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|                                                                                                                                                                             |  |      |        |   |      |  |        |  
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---- | ------ | - | ---- |  | ------ | -
|( million)                                                                                                                                                                  |  | 2010 |        |   | 2009 | 
|Business net income                                                                                                                                                          |  |      | 9,215  |   |      |  | 8,629  |  
|(i)             Amortization of intangible assets                                                                                                                            |  |      | (3,529 | ) |      |  | (3,528 | )
|(ii)            Impairment of intangible assets                                                                                                                              |  |      | (433   | ) |      |  | (372   | )
|(iii)           Expenses arising from the impact of acquisitions on inventories(1)                                                                                           |  |      | (30    | ) |      |  | (27    | )
|(iv)           Restructuring costs                                                                                                                                           |  |      | (1,372 | ) |      |  | (1,080 | )
|(iii)/(iv)    Other
items(2)                                                                                                                                                 |  |      | (138   | ) |      |  |       |  
|(v)            Tax effects of:                                                                                                                                               |  |      | 1,841  |   |      |  | 1,629  |  
| amortization of intangible assets                                                                                                                                          |  |      | 1,181  |   |      |  | 1,126  |  
| impairment of intangible assets                                                                                                                                            |  |      | 143    |   |      |  | 136    |  
| expenses arising from the impact of acquisitions on
inventories                                                                                                            |  |      | 9      |   |      |  | 7      |  
| restructuring costs                                                                                                                                                        |  |      | 462    |   |      |  | 360    |  
| other items                                                                                                                                                                |  |      | 46     |   |      |  |       |  
|(iii)/(vi)    Other tax
items(3)                                                                                                                                             |  |      |       |   |      |  | 106    |  
|(vii)          Share of items listed above attributable to non-controlling interests                                                                                         |  |      | 3      |   |      |  | 1      |  
|(iii)           Expenses arising from the impact of the Merial acquisition(4)                                                                                                |  |      | (32    | ) |      |  | (66    | )
|(iii)/(iv)    Restructuring costs of associates and joint ventures, and expenses arising
from                 the impact of acquisitions on associates and joint ventures(5) |  |      | (58    | ) |      |  | (27    | )
|Net income attributable to equity holders of sanofi-aventis                                                                                                                  |  |      | 5,467  |   |      |  | 5,265  |  
|(1)   This line comprises the workdown of inventories remeasured at fair value at the acquisition date.                                                                      | 
|(2)   Other items comprise:                                                                                                                                                  | 
| reversals of/charges to provisions for risks                                                                                                                               |  |      | (138   | ) |      |  |        |  
|(3)   Other tax items comprise:                                                                                                                                              |  |      |        |   |      |  |        |  
| reversal of deferred taxes following ratification of the Franco-American Treaty                                                                                            |  |      |        |   |      |  | 106    |  

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  |  |  | 
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  |  | 
|(4)   This line item comprises: until September 17, 2009, amortization and impairment charged
against the intangible assets of Merial; and from September 18, 2009, (i) the impact of discontinuation of depreciation of the property, plant and equipment of Merial in accordance with IFRS 5 (see Note B.7. to the consolidated
financial statements) and (ii) the expense arising from the workdown of inventories remeasured at fair value at the acquisition date.
|(5)   This line shows the portion of major restructuring costs incurred by associates and joint
ventures, and expenses arising from the impact of acquisitions on associates and joint ventures (workdown of acquired inventories, amortization and impairment of intangible assets, and impairment of goodwill).                                                                                                                                                      



Business Earnings Per Share



We also report business earnings per share, a non-GAAP
financial measure which we define as business net income divided by the weighted average number of shares outstanding (see  Business Net Income above).



Business earnings per share for 2010 were 7.06, up 6.8%
on the 2009 business earnings per share figure of 6.61. The weighted average number of shares outstanding was 1,305.3 million in 2010 and 1,305.9 million in 2009. Diluted business earnings per share for 2010 were 7.04, up 6.7%
on the 2009 diluted business earnings per share figure of 6.60. On a diluted basis, the weighted average number of shares outstanding was 1,308.2 million in 2010 and 1,307.4 million in 2009.



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##### Table of Contents

Year Ended December 31, 2009 Compared with Year Ended December 31, 2008



The consolidated income statements for the
years ended December 31, 2009 and December 31, 2008 break down as follows:



|                                                               |  |      |         |   |                   |  |         |      |  |  |                   |   |  |  |         | 
|-------------------------------------------------------------- |  | ---- | ------- | - | ----------------- |  | ------- | ---- |  |  | ----------------- | - |  |  | ------- | 
|(under IFRS) ( million)                                       |  | 2009 |         |   | as % of
net sales |  |         | 2008 |  |  | as % of
net sales |  
|Net sales                                                      |  |      | 29,306  |   |                   |  | 100.0%  |      |  |  | 27,568            |   |  |  | 100.0%  | 
|Other revenues                                                 |  |      | 1,443   |   |                   |  | 4.9%    |      |  |  | 1,249             |   |  |  | 4.5%    | 
|Cost of sales                                                  |  |      | (7,880  | ) |                   |  | (26.9%) |      |  |  | (7,337            | ) |  |  | (26.6%) | 
|Gross profit                                                   |  |      | 22,869  |   |                   |  | 78.0%   |      |  |  | 21,480            |   |  |  | 77.9%   | 
|Research & development expenses                                |  |      | (4,583  | ) |                   |  | (15.6%) |      |  |  | (4,575            | ) |  |  | (16.6%) | 
|Selling & general expenses                                     |  |      | (7,325  | ) |                   |  | (25.0%) |      |  |  | (7,168            | ) |  |  | (26.0%) | 
|Other operating income                                         |  |      | 866     |   |                   |  |         |      |  |  | 556               |   |  |  |         | 
|Other operating expenses                                       |  |      | (481    | ) |                   |  |         |      |  |  | (353              | ) |  |  |         | 
|Amortization of intangible assets                              |  |      | (3,528  | ) |                   |  |         |      |  |  | (3,483            | ) |  |  |         | 
|Impairment of intangible assets                                |  |      | (372    | ) |                   |  |         |      |  |  | (1,554            | ) |  |  |         | 
|Restructuring costs                                            |  |      | (1,080  | ) |                   |  |         |      |  |  | (585              | ) |  |  |         | 
|Gains and losses on disposals, and litigation                  |  |      |        |   |                   |  |         |      |  |  | 76                |   |  |  |         | 
|Operating income                                               |  |      | 6,366   |   |                   |  | 21.7%   |      |  |  | 4,394             |   |  |  | 15.9%   | 
|Financial expenses                                             |  |      | (324    | ) |                   |  |         |      |  |  | (335              | ) |  |  |         | 
|Financial income                                               |  |      | 24      |   |                   |  |         |      |  |  | 103               |   |  |  |         | 
|Income before tax and associates and joint ventures            |  |      | 6,066   |   |                   |  | 20.7%   |      |  |  | 4,162             |   |  |  | 15.1%   | 
|Income tax expense                                             |  |      | (1,364  | ) |                   |  |         |      |  |  | (682              | ) |  |  |         | 
|Share of profit/loss of associates and joint ventures          |  |      | 814     |   |                   |  |         |      |  |  | 692               |   |  |  |         | 
|Net income excluding the held-for-exchange Merial business (1) |  |      | 5,516   |   |                   |  | 18.8%   |      |  |  | 4,172             |   |  |  | 15.1%   | 
|Net income from the held-for-exchange Merial business(1)       |  |      | 175     |   |                   |  |         |      |  |  | 120               |   |  |  |         | 
|Net income                                                     |  |      | 5,691   |   |                   |  | 19.4%   |      |  |  | 4,292             |   |  |  | 15.6%   | 
|Net income attributable to non-controlling interests           |  |      | 426     |   |                   |  |         |      |  |  | 441               |   |  |  |         | 
|Net income attributable to equity holders of sanofi-aventis    |  |      | 5,265   |   |                   |  | 18.0%   |      |  |  | 3,851             |   |  |  | 14.0%   | 
|Average number of shares outstanding (million)                 |  |      | 1,305.9 |   |                   |  |         |      |  |  | 1,309.3           |   |  |  |         | 
|Average number of shares outstanding after dilution (million)  |  |      | 1,307.4 |   |                   |  |         |      |  |  | 1,310.9           |   |  |  |         | 
|Basic earnings per share (in euros)                            |  |      | 4.03    |   |                   |  |         |      |  |  | 2.94              |   |  |  |         | 
|Diluted earnings per share (in euros)                          |  |      | 4.03    |   |                   |  |         |      |  |  | 2.94              |   |  |  |         | 



|(1) | Reported separately in accordance with IFRS 5 (Non-Current Assets Held for
Sale and Discontinued Operations). For the other disclosures required under IFRS 5, refer to Note D.8. to our consolidated financial statements included at Item 18 of this annual report.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Net Sales



Net sales for the year ended
December 31, 2009 amounted to 29,306 million, an increase of 6.3% versus 2008. Exchange rate movements had a favorable effect of 1.0 point, mainly reflecting the appreciation in the U.S. dollar against the euro. At constant exchange
rates and after taking account of changes in structure (mainly the consolidation of Zentiva and Medley from the second quarter of 2009, and the reversion of Copaxone® to Teva in North America effective April 1, 2008), net sales rose by 5.3%. Excluding changes in structure and at constant exchange rates, organic net sales
growth was 4.0%.



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##### Table of Contents

The following table sets forth a reconciliation of our reported net sales for the years
ended December 31, 2009 and December 31, 2008 to our net sales at constant exchange rates and net sales on a constant structure basis.



|                                                                       |  |      |        |   |      |  |        |            |  |  |       | 
|---------------------------------------------------------------------- |  | ---- | ------ | - | ---- |  | ------ | ---------- |  |  | ----- | 
|( million)                                                            |  | 2009 |        |   | 2008 |  |        | Change
(%) | 
|Reported net sales                                                     |  |      | 29,306 |   |      |  | 27,568 |            |  |  | +6.3% | 
|Effect of exchange rates                                               |  |      | (274   | ) |      |  |        |            |  |  |       | 
|Net sales at constant exchange rates                                   |  |      | 29,032 |   |      |  | 27,568 |            |  |  | +5.3% | 
|Effect of changes in structure                                         |  |      |        |   |      |  | 339    |            |  |  |       | 
|Net sales on a constant structure basis and at constant exchange
rates |  |      | 29,032 |   |      |  | 27,907 |            |  |  | +4.0% | 



Our net sales comprise the net sales generated by our Pharmaceuticals business and net sales generated by our Human Vaccines (Vaccines)
business. Net sales from the animal health business are not consolidated, the profit contribution from Merial being reported on the line Net income from the held-for-exchange Merial business in accordance with IFRS 5 (see Note D.8.
to our consolidated financial statements included at Item 18 of this annual report). The following table breaks down our 2009 and 2008 net sales by business segment:



|                |  |               |        |  |               |  |        |                                |  |  |                                       |  |  |                                                                         |        |  |  |  |        | 
|--------------- |  | ------------- | ------ |  | ------------- |  | ------ | ------------------------------ |  |  | ------------------------------------- |  |  | ----------------------------------------------------------------------- | ------ |  |  |  | ------ | 
|( million)     |  | 2009
Reported |        |  | 2008
Reported |  |        | Change on a
reported basis (%) |  |  | Change at
constant
exchange rates (%) |  |  | Change on a
constant structure basis and at constant exchange
rates (%) |       
|Pharmaceuticals |  |               | 25,823 |  |               |  | 24,707 |                                |  |  | +4.5%                                 |  |  |                                                                         | +3.7%  |  |  |  | +2.3%  | 
|Vaccines        |  |               | 3,483  |  |               |  | 2,861  |                                |  |  | +21.7%                                |  |  |                                                                         | +19.2% |  |  |  | +18.9% | 
|Total           |  |               | 29,306 |  |               |  | 27,568 |                                |  |  | +6.3%                                 |  |  |                                                                         | +5.3%  |  |  |  | +4.0%  | 



Net Sales by Product  Pharmaceuticals



Net sales generated by our Pharmaceuticals business in 2009
were 25,823 million, an increase of 3.7% at constant exchange rates and of 4.5% on a reported basis.



Net sales of our flagship products (see table below) were adversely affected by competition from generics of Eloxatine® in the United States and Europe; without this effect, growth in Pharmaceuticals net sales would have been 2.2 points
higher in 2009 (at constant exchange rates).



Net sales of the other products in our portfolio fell by 6.0% at constant exchange rates to 6,078 million, compared with
6,484 million in 2008. At constant exchange rates, net sales of these products were down 9.7% in Europe, at 3,283 million; up 1.2% in the United States, at 610 million; and down 1.5% in the Other Countries region, at
2,185 million.



For a description of our
other pharmaceutical products, see Item 4. Information on the Company  B. Business Overview  Pharmaceutical Products.



Our Consumer Health Care business achieved net sales growth of 26.8% in 2009 at constant exchange rates, to 1,430 million. This
includes the consolidation of Symbion Consumer (now sanofi-aventis Healthcare Holdings Pty Limited), with effect from September 1, 2008; of Zentivas consumer health care products, with effect from April 1, 2009; and of Oenobiol, with
effect from December 1, 2009. On a constant structure basis and at constant exchange rates, the growth rate was 8.1%.



In 2009, net sales for our Generics business increased almost threefold (by 198% at constant exchange rates) to 1,012 million,
boosted by the consolidation of Zentiva and Kendrick (each from April 1) and Medley (from May 1). On a constant structure basis and at constant exchange rates, the growth rate was 8.7%.



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##### Table of Contents

The following table breaks down our 2009 and 2008 net sales for the Pharmaceuticals business
by product:



|                          |  |            |                                                       |  |               |  |        |               |  |  |                                |  |  |                                       |         |  |                                                                     |  |         |  |  |  |        | 
|------------------------- |  | ---------- | ----------------------------------------------------- |  | ------------- |  | ------ | ------------- |  |  | ------------------------------ |  |  | ------------------------------------- | ------- |  | ------------------------------------------------------------------- |  | ------- |  |  |  | ------ | 
|( million) Product       |  | Indication |                                                       |  | 2009
Reported |  |        | 2008
Reported |  |  | Change on
a reported
basis (%) |  |  | Change at
constant
exchange
rates (%) |         |  | Change on aconstant structurebasis and atconstant exchangerates
(%) | 
|Lantus®                   |  |            | Diabetes                                              |  |               |  | 3,080  |               |  |  | 2,450                          |  |  |                                       | +25.7%  |  |                                                                     |  | +22.5%  |  |  |  | +22.5% | 
|Apidra®                   |  |            | Diabetes                                              |  |               |  | 137    |               |  |  | 98                             |  |  |                                       | +39.8%  |  |                                                                     |  | +38.8%  |  |  |  | +38.8% | 
|Amaryl®                   |  |            | Diabetes                                              |  |               |  | 416    |               |  |  | 379                            |  |  |                                       | +9.8%   |  |                                                                     |  | +4.2%   |  |  |  | +4.2%  | 
|Insuman®                  |  |            | Diabetes                                              |  |               |  | 131    |               |  |  | 143                            |  |  |                                       | -8.4%   |  |                                                                     |  | -7.0%   |  |  |  | -7.0%  | 
|Sub-total: Diabetes       |  |            |                                                       |  |               |  | 3,764  |               |  |  | 3,070                          |  |  |                                       | +22.6%  |  |                                                                     |  | +19.4%  |  |  |  | +19.4% | 
|Lovenox®                  |  |            | Thrombosis                                            |  |               |  | 3,043  |               |  |  | 2,738                          |  |  |                                       | +11.1%  |  |                                                                     |  | +8.8%   |  |  |  | +8.8%  | 
|Taxotere®                 |  |            | Breast, lung, prostate,stomach, and head &neck cancer |  |               |  | 2,177  |               |  |  | 2,033                          |  |  |                                       | +7.1%   |  |                                                                     |  | +6.1%   |  |  |  | +6.1%  | 
|Plavix®                   |  |            | Atherothrombosis                                      |  |               |  | 2,623  |               |  |  | 2,609                          |  |  |                                       | +0.5%   |  |                                                                     |  | +0.2%   |  |  |  | +0.2%  | 
|Aprovel®/CoAprovel®       |  |            | Hypertension                                          |  |               |  | 1,236  |               |  |  | 1,202                          |  |  |                                       | +2.8%   |  |                                                                     |  | +4.7%   |  |  |  | +4.7%  | 
|Eloxatine®                |  |            | Colorectal cancer                                     |  |               |  | 957    |               |  |  | 1,345                          |  |  |                                       | -28.8%  |  |                                                                     |  | -34.7%  |  |  |  | -34.7% | 
|Multaq®                   |  |            | Atrial fibrillation                                   |  |               |  | 25     |               |  |  |                               |  |  |                                       |        |  |                                                                     |  |        |  |  |  |       | 
|Stilnox®/Ambien® /Myslee® |  |            | Sleep disorders                                       |  |               |  | 873    |               |  |  | 822                            |  |  |                                       | +6.2%   |  |                                                                     |  | -1.3%   |  |  |  | -1.3%  | 
|Allegra®                  |  |            | Allergic rhinitis,urticaria                           |  |               |  | 731    |               |  |  | 666                            |  |  |                                       | +9.8%   |  |                                                                     |  | -2.6%   |  |  |  | -2.6%  | 
|Copaxone®                 |  |            | Multiple sclerosis                                    |  |               |  | 467    |               |  |  | 622                            |  |  |                                       | -24.9%  |  |                                                                     |  | -23.8%  |  |  |  | +20.6% | 
|Tritace®                  |  |            | Hypertension                                          |  |               |  | 429    |               |  |  | 491                            |  |  |                                       | -12.6%  |  |                                                                     |  | -9.2%   |  |  |  | -9.2%  | 
|Dépakine®                 |  |            | Epilepsy                                              |  |               |  | 329    |               |  |  | 322                            |  |  |                                       | +2.2%   |  |                                                                     |  | +7.1%   |  |  |  | +7.1%  | 
|Xatral®                   |  |            | Benign prostatichypertrophy                           |  |               |  | 296    |               |  |  | 319                            |  |  |                                       | -7.2%   |  |                                                                     |  | -8.5%   |  |  |  | -8.5%  | 
|Actonel®                  |  |            | Osteoporosis, Pagetsdisease                          |  |               |  | 264    |               |  |  | 330                            |  |  |                                       | -20.0%  |  |                                                                     |  | -17.6%  |  |  |  | -7.5%  | 
|Nasacort®                 |  |            | Allergic rhinitis                                     |  |               |  | 220    |               |  |  | 240                            |  |  |                                       | -8.3%   |  |                                                                     |  | -11.7%  |  |  |  | -11.7% | 
|Other products            |  |            |                                                       |  |               |  | 5,947  |               |  |  | 6,341                          |  |  |                                       | -6.2%   |  |                                                                     |  | -5.9%   |  |  |  | -2.4%  | 
|Consumer Health Care      |  |            |                                                       |  |               |  | 1,430  |               |  |  | 1,203                          |  |  |                                       | +18.9%  |  |                                                                     |  | +26.8%  |  |  |  | +8.1%  | 
|Generics                  |  |            |                                                       |  |               |  | 1,012  |               |  |  | 354                            |  |  |                                       | +185.9% |  |                                                                     |  | +198.0% |  |  |  | +8.7%  | 
|Total pharmaceuticals     |  |            |                                                       |  |               |  | 25,823 |               |  |  | 24,707                         |  |  |                                       | +4.5%   |  |                                                                     |  | +3.7%   |  |  |  | +2.3%  | 



98



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##### Table of Contents

The table below breaks down net sales of our Pharmaceuticals business products by
geographical region in 2009:



|                          |  |                 |       |  |                                   |  |        |               |  |  |                                   |  |  |                    |        |  |                                   |  |       |                    |  |  |                                   |  |  |  |       |  |  |  |         | 
|------------------------- |  | --------------- | ----- |  | --------------------------------- |  | ------ | ------------- |  |  | --------------------------------- |  |  | ------------------ | ------ |  | --------------------------------- |  | ----- | ------------------ |  |  | --------------------------------- |  |  |  | ----- |  |  |  | ------- | 
|( million) Product       |  | Western
Europe* |       |  | Change at
constant
exchange
rates |  |        | United
States |  |  | Change at
constant
exchange
rates |  |  | Emerging
Markets** |        |  | Change at
constant
exchange
rates |  |       | Other
countries*** |  |  | Change at
constant
exchange
rates | 
|Lantus®                   |  |                 | 643   |  |                                   |  | +10.2% |               |  |  | 1,909                             |  |  |                    | +23.6% |  |                                   |  | 401   |                    |  |  | +34.1%                            |  |  |  | 127   |  |  |  | +48.1%  | 
|Apidra®                   |  |                 | 55    |  |                                   |  | +34.1% |               |  |  | 54                                |  |  |                    | +27.5% |  |                                   |  | 24    |                    |  |  | +68.8%                            |  |  |  | 4     |  |  |  | +200.0% | 
|Amaryl ®                  |  |                 | 51    |  |                                   |  | -15.0% |               |  |  | 9                                 |  |  |                    | +33.3% |  |                                   |  | 175   |                    |  |  | +7.7%                             |  |  |  | 181   |  |  |  | +6.9%   | 
|Insuman®                  |  |                 | 109   |  |                                   |  | -9.1%  |               |  |  |                                  |  |  |                    |       |  |                                   |  | 21    |                    |  |  | +4.3%                             |  |  |  | 1     |  |  |  |        | 
|Sub-total: Diabetes       |  |                 | 858   |  |                                   |  | +6.7%  |               |  |  | 1,972                             |  |  |                    | +23.8% |  |                                   |  | 621   |                    |  |  | +25.4%                            |  |  |  | 313   |  |  |  | +22.7%  | 
|Lovenox®                  |  |                 | 725   |  |                                   |  | +11.4% |               |  |  | 1,822                             |  |  |                    | +5.3%  |  |                                   |  | 434   |                    |  |  | +17.4%                            |  |  |  | 62    |  |  |  | +21.2%  | 
|Taxotere®                 |  |                 | 786   |  |                                   |  | +6.5%  |               |  |  | 827                               |  |  |                    | +5.3%  |  |                                   |  | 364   |                    |  |  | +6.1%                             |  |  |  | 200   |  |  |  | +7.1%   | 
|Plavix®                   |  |                 | 1,383 |  |                                   |  | -11.6% |               |  |  | 222a                              |  |  |                    | +28.5% |  |                                   |  | 608   |                    |  |  | +4.9%                             |  |  |  | 410   |  |  |  | +44.4%  | 
|Aprovel®/CoAprovel®       |  |                 | 861   |  |                                   |  | +2.5%  |               |  |  | 7a                                |  |  |                    |       |  |                                   |  | 313   |                    |  |  | +11.4%                            |  |  |  | 55    |  |  |  | -8.2%   | 
|Eloxatine®                |  |                 | 77    |  |                                   |  | -55.0% |               |  |  | 677                               |  |  |                    | -37.2% |  |                                   |  | 153   |                    |  |  | -12.4%                            |  |  |  | 50    |  |  |  | +4.2%   | 
|Multaq®                   |  |                 |      |  |                                   |  |       |               |  |  | 25                                |  |  |                    |       |  |                                   |  |      |                    |  |  |                                  |  |  |  |      |  |  |  |        | 
|Stilnox®/Ambien® /Myslee® |  |                 | 60    |  |                                   |  | -4.8%  |               |  |  | 555                               |  |  |                    | -4.8%  |  |                                   |  | 60    |                    |  |  | -6.1%                             |  |  |  | 198   |  |  |  | +15.1%  | 
|Allegra®                  |  |                 | 17    |  |                                   |  | -15.0% |               |  |  | 306                               |  |  |                    | -15.9% |  |                                   |  | 69    |                    |  |  | +4.3%                             |  |  |  | 339   |  |  |  | +14.8%  | 
|Copaxone®                 |  |                 | 439   |  |                                   |  | +21.6% |               |  |  |                                  |  |  |                    |       |  |                                   |  | 15    |                    |  |  | -5.6%                             |  |  |  | 13    |  |  |  | -55.2%  | 
|Tritace®                  |  |                 | 197   |  |                                   |  | -12.4% |               |  |  |                                  |  |  |                    |       |  |                                   |  | 189   |                    |  |  | -6.0%                             |  |  |  | 43    |  |  |  | -8.3%   | 
|Depakine®                 |  |                 | 143   |  |                                   |  | +2.1%  |               |  |  |                                  |  |  |                    |       |  |                                   |  | 175   |                    |  |  | +12.1%                            |  |  |  | 11    |  |  |  | +0.0%   | 
|Xatral®                   |  |                 | 77    |  |                                   |  | -32.2% |               |  |  | 147                               |  |  |                    | +16.0% |  |                                   |  | 66    |                    |  |  | -6.7%                             |  |  |  | 6     |  |  |  | -40.0%  | 
|Actonel®                  |  |                 | 136   |  |                                   |  | -26.7% |               |  |  |                                  |  |  |                    |       |  |                                   |  | 97    |                    |  |  | -8.0%                             |  |  |  | 31    |  |  |  | +3.3%   | 
|Nasacort®                 |  |                 | 29    |  |                                   |  | -9.1%  |               |  |  | 158                               |  |  |                    | -15.4% |  |                                   |  | 28    |                    |  |  | +7.1%                             |  |  |  | 5     |  |  |  | +0.0%   | 
|Other products            |  |                 | 2,696 |  |                                   |  | -11.1% |               |  |  | 610                               |  |  |                    | +1.2%  |  |                                   |  | 1,927 |                    |  |  | +0.4%                             |  |  |  | 714   |  |  |  | -7.6%   | 
|Consumer Health Care      |  |                 | 622   |  |                                   |  | +5.6%  |               |  |  |                                  |  |  |                    |       |  |                                   |  | 674   |                    |  |  | +38.1%                            |  |  |  | 134   |  |  |  | +129.5% | 
|Generics                  |  |                 | 360   |  |                                   |  | +23.2% |               |  |  |                                  |  |  |                    |       |  |                                   |  | 631   |                    |  |  |                                  |  |  |  | 21    |  |  |  | +0.0%   | 
|Total pharmaceuticals     |  |                 | 9,466 |  |                                   |  | -3.6%  |               |  |  | 7,328                             |  |  |                    | -1.2%  |  |                                   |  | 6,424 |                    |  |  | +19.4%                            |  |  |  | 2,605 |  |  |  | +11.5%  | 



|* | France, Germany, United Kingdom, Italy, Spain, Greece, Cyprus, Malta, Belgium, Luxembourg,
Portugal, Netherlands, Austria, Switzerland, Sweden, Ireland, Finland, Norway, Iceland, Denmark.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|** | World excluding United States, Canada, Western Europe, Japan, Australia and New Zealand.
|-- | ----------------------------------------------------------------------------------------

|*** | Japan, Canada, Australia and New Zealand.
|--- | -----------------------------------------

|a | Sales of active ingredient to the entity majority-owned by BMS in the United States.
|- | ------------------------------------------------------------------------------------



Flagship Products (1)



Net sales of Lantus®, the worlds leading insulin brand (source: IMS 2009 sales), rose by 22.5% (at constant exchange rates) to 3,080 million in 2009, driven largely
by the SoloSTAR® injection pen. Growth was strong across all three geographic regions at 23.6% in the United
States, 12.2% in Europe and 42.8% in the Other Countries region (all at constant exchange rates). In the Other Countries region, the performance of Lantus® is particularly high in China, Japan and Mexico, with respective growth rates at constant exchange rates of 113.7%, 81.6% and 48.2%.



Net sales of the rapid-acting analog of
human insulin Apidra®were 137 million, up 38.8% (at constant exchange rates), boosted by the
launch of Apidra® SoloSTAR® in the United States.



|(1) | Sales of Plavix® and Aprovel® are discussed below under  Worldwide Presence of Plavix® and Aprovel®.
|--- | -------------------------------------------------------------------------------------------------------



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Lovenox®, the leader in anti-thrombotics in the United States, Germany, France, Italy, Spain, and the United Kingdom (source: IMS 2009 sales), achieved net sales growth of
8.8% in 2009 (at constant exchange rates) to 3,043 million, driven by double-digit growth in Europe (up 13.7% at constant exchange rates, at 890 million) and in the Other Countries region (up 14.8% at constant exchange rates, at
331 million). In the United States, net sales increased by 5.3% to 1,822 million.



Taxotere® posted growth of 6.1% in 2009 at constant exchange rates to 2,177 million, driven by its use in adjuvant breast cancer treatment and in prostate
cancer. Growth was good across all three geographic regions at 7.1% in Europe, 5.3% in the United States and 5.1% in the Other Countries region (all at constant exchange rates). In Japan, the product made further advances, with net sales rising by
9.5% to 129 million, in particular due to the prostate cancer indication approved in the second half of 2008.



Eloxatine® saw net sales fall by 34.7% at constant exchange rates in 2009 to 957 million, due to ongoing genericization in Europe and competition from a number of
generics in the United States during the second half of the year.



Net sales of the hypnotic Stilnox®/Ambien®/Myslee® fell by 1.3% at constant exchange rates. In the United States, Ambien® CR reported growth of 0.9% at constant exchange rates, to 497 million. In Japan, net sales of Myslee®, the leading hypnotic on the market (source: IMS 2009 sales), totaled 194 million, an increase of 15.2% at constant exchange rates.



Allegra® saw net sales fall by 2.6% at constant exchange rates in 2009 to 731 million, reflecting the arrival
of Allegra® D 12 generics in the United States in the fourth quarter of 2009 (which follows the
settlement of the U.S. patent infringement suit related to Barrs proposed generic version) and ongoing genericization in Europe. In 2009, sales decreased respectively by 15.9% and 20% (at constant exchange rates) in the United States and
Europe. The product recorded further growth in Japan, with sales up 15.2% at constant exchange rates, at 334 million.



The end of commercialization of Copaxone®by sanofi-aventis in North America effective April 1, 2008 resulted in a 23.8% drop in consolidated net sales of this product in 2009 (at constant exchange
rates), to 467 million.



Multaq® was launched in the United States during the third quarter of 2009. Sales of the product in 2009 amounted to 25 million.



Net Sales  Human Vaccines (Vaccines)



In 2009, our Vaccines business generated
consolidated net sales of 3,483 million, up 19.2% at constant exchange rates and 21.7% on a reported basis. The main growth drivers were Pentacel® and A(H1N1) influenza vaccines. Growth at constant exchange rates was robust across all three geographic regions, at 19.1% in the United States (to 2,098
million), 15.9% in Europe (to 448 million) and 20.8% in the Other Countries region (to 937 million). Excluding the impact of sales of pandemic influenza vaccines (A(H1N1) and H5N1), net sales growth was 7.1% (at constant exchange rates).



Polio/Pertussis/Hib vaccines
achieved growth of 22.8% at constant exchange rates to 968 million, reflecting the success of
Pentacel®(the first 5-in-1 pediatric combination vaccine against diphtheria, tetanus, pertussis, polio
and haemophilus influenzae type b licensed in the United States in June 2008), which posted net sales of 343 million in 2009 versus 84 million in 2008.



Net sales of influenza vaccines rose by 46.7% at
constant exchange rates to 1,062 million, mainly due to the shipment during 2009 of batches of vaccines against the A(H1N1) influenza virus for a total amount of 440 million, including 301 million in the United
States.



Meningitis/pneumonia
vaccines achieved net sales of 538 million, up 6.1% at constant exchange rates, largely as a result of good growth in sales of vaccines against pneumococcal infections. Net sales of Menactra®(quadrivalent meningococcal meningitis vaccine) increased by 1.1% at constant exchange rates to 445
million.



100



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Net sales of adult booster vaccines fell by 3.0% at constant exchange
rates to 406 million. Net sales of Adacel®(adult and adolescent tetanus/diphtheria/pertussis
booster vaccine) were 267 million, down 1.2% at constant exchange rates.



Shantha, consolidated from September 1, 2009, contributed net sales of 17 million in 2009.



The following table presents the 2009 sales of our Vaccines activity by range of products:



|                                                                 |  |               |       |  |               |  |       |                                |  |  |                                       |  |  |  |        | 
|---------------------------------------------------------------- |  | ------------- | ----- |  | ------------- |  | ----- | ------------------------------ |  |  | ------------------------------------- |  |  |  | ------ | 
|( million)                                                      |  | 2009
Reported |       |  | 2008
Reported |  |       | Change on
a reported
basis (%) |  |  | Change at
constant
exchange
rates (%) | 
|Influenza Vaccines (including Vaxigrip®
and Fluzone®)            |  |               | 1,062 |  |               |  | 736   |                                |  |  | +44.3%                                |  |  |  | +46.6% | 
| of which seasonal influenza vaccines                           |  |               | 597   |  |               |  | 610   |                                |  |  | -2.1%                                 |  |  |  | -1.7%  | 
| of which pandemic influenza vaccines                           |  |               | 465   |  |               |  | 126   |                                |  |  |                                      |  |  |  |       | 
|Polio/Pertussis/Hib Vaccines (including
Pentacel® and Pentaxim®) |  |               | 968   |  |               |  | 768   |                                |  |  | +26.0%                                |  |  |  | +22.8% | 
|Meningitis/Pneumonia Vaccines (including
Menactra®)              |  |               | 538   |  |               |  | 472   |                                |  |  | +14.0%                                |  |  |  | +6.1%  | 
|Adult Booster Vaccines (including
Adacel®)                       |  |               | 406   |  |               |  | 399   |                                |  |  | +1.8%                                 |  |  |  | -3.0%  | 
|Travel and Other Endemics Vaccines                               |  |               | 313   |  |               |  | 309   |                                |  |  | +1.3%                                 |  |  |  | 0.0%   | 
|Other Vaccines                                                   |  |               | 196   |  |               |  | 177   |                                |  |  | +10.7%                                |  |  |  | +6.8%  | 
|Total Vaccines                                                   |  |               | 3,483 |  |               |  | 2,861 |                                |  |  | +21.7%                                |  |  |  | +19.2% | 



The following table presents the 2009 sales of our Vaccines business by range of products and by region:



|                                                           |  |                          |     |  |                                   |  |         |                        |  |  |                                   |  |  |                             |        |  |                                   |  |     |                             |  |  |                                   |  |  |  |     |  |  |  |        | 
|---------------------------------------------------------- |  | ------------------------ | --- |  | --------------------------------- |  | ------- | ---------------------- |  |  | --------------------------------- |  |  | --------------------------- | ------ |  | --------------------------------- |  | --- | --------------------------- |  |  | --------------------------------- |  |  |  | --- |  |  |  | ------ | 
|( million)                                                |  | Western
Europe*
Reported |     |  | Change at
constant
exchange
rates |  |         | United
States
Reported |  |  | Change at
constant
exchange
rates |  |  | Emerging
Markets**
Reported |        |  | Change at
constant
exchange
rates |  |     | Other
countries***
Reported |  |  | Change at
constant
exchange
rates | 
|Influenza Vaccinesa
(inc.
Vaxigrip® and Fluzone®)          |  |                          | 139 |  |                                   |  | +113.8% |                        |  |  | 618                               |  |  |                             | +36.2% |  |                                   |  | 287 |                             |  |  | +53.6%                            |  |  |  | 18  |  |  |  | 0.0%   | 
|Polio/Pertussis.Hib Vaccines
(inc.Pentacel® and Pentaxim®) |  |                          | 68  |  |                                   |  | +7.7%   |                        |  |  | 529                               |  |  |                             | +56.8% |  |                                   |  | 332 |                             |  |  | -5.4%                             |  |  |  | 39  |  |  |  | +29.0% | 
|Meningitis/Pneumonia Vaccines
(inc.
Menactra®)             |  |                          | 11  |  |                                   |  | +120.0% |                        |  |  | 437                               |  |  |                             | 0.0%   |  |                                   |  | 78  |                             |  |  | +32.2%                            |  |  |  | 12  |  |  |  | +50.0% | 
|Adult Booster Vaccines
(inc.
Adacel®)                      |  |                          | 56  |  |                                   |  | +9.8%   |                        |  |  | 310                               |  |  |                             | -8.5%  |  |                                   |  | 25  |                             |  |  | +47.1%                            |  |  |  | 15  |  |  |  | +14.3% | 
|Travel and Other Endemics Vaccines                         |  |                          | 15  |  |                                   |  | -16.7%  |                        |  |  | 69                                |  |  |                             | -15.8% |  |                                   |  | 196 |                             |  |  | +9.5%                             |  |  |  | 33  |  |  |  | -5.6%  | 
|Other Vaccines                                             |  |                          | 38  |  |                                   |  | -9.3%   |                        |  |  | 135                               |  |  |                             | +13.2% |  |                                   |  | 14  |                             |  |  | +16.7%                            |  |  |  | 9   |  |  |  | 0.0%   | 
|Total Vaccines                                             |  |                          | 327 |  |                                   |  | +33.6%  |                        |  |  | 2,098                             |  |  |                             | +19.1% |  |                                   |  | 932 |                             |  |  | +16.0%                            |  |  |  | 126 |  |  |  | +11.1% | 



|* | France, Germany, United Kingdom, Italy, Spain, Greece, Cyprus, Malta, Belgium, Luxembourg,
Portugal, Netherlands, Austria, Switzerland, Sweden, Ireland, Finland, Norway, Iceland, Denmark.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|** | World excluding United States, Canada, Western Europe, Japan, Australia and New Zealand.
|-- | ----------------------------------------------------------------------------------------

|*** | Japan, Canada, Australia and New Zealand.
|--- | -----------------------------------------

|a | Seasonal and pandemic influenza vaccines.
|- | -----------------------------------------



In addition to the Vaccines activity reflected in our
consolidated net sales, sales at Sanofi Pasteur MSD, our joint venture with Merck & Co. in Western Europe, reached 1,132 million, a fall of 11.0% on a reported basis.



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Full-year net sales of Gardasil®, a vaccine that prevents
papillomavirus infections (a cause of cervical cancer), amounted to 395 million, compared with 584 million in 2008. This 32.4% decrease reflects extensive catch-up vaccination campaigns in 2008.



Sales generated by Sanofi Pasteur MSD are not included in our
consolidated net sales.



Net Sales by
Geographic Region



We divide our sales
geographically into four regions: Western Europe, the United States, Emerging Markets and Other Countries. The following table breaks down our 2009 and 2008 net sales by region:



|                                        |  |               |        |  |               |  |        |                          |  |  |                                 |  |  |  |        | 
|--------------------------------------- |  | ------------- | ------ |  | ------------- |  | ------ | ------------------------ |  |  | ------------------------------- |  |  |  | ------ | 
|( million)                             |  | 2009 Reported |        |  | 2008 Reported |  |        | Change ona reportedbasis |  |  | Change atconstantexchange rates | 
|Western Europe*                         |  |               | 9,793  |  |               |  | 10,189 |                          |  |  | -3.9%                           |  |  |  | -2.7%  | 
|United States                           |  |               | 9,426  |  |               |  | 8,609  |                          |  |  | +9.5%                           |  |  |  | +2.8%  | 
|Emerging Markets**                      |  |               | 7,356  |  |               |  | 6,540  |                          |  |  | +12.5%                          |  |  |  | +19.0% | 
|Of which Eastern Europe and Turkey      |  |               | 2,266  |  |               |  | 1,907  |                          |  |  | +18.8%                          |  |  |  | +34.9% | 
|Of which Asia (excl. Pacific region***) |  |               | 1,610  |  |               |  | 1,486  |                          |  |  | +8.3%                           |  |  |  | +9.0%  | 
|Of which Latin America                  |  |               | 1,913  |  |               |  | 1,739  |                          |  |  | +10.0%                          |  |  |  | +15.7% | 
|Of which Africa                         |  |               | 775    |  |               |  | 725    |                          |  |  | +6.8%                           |  |  |  | +8.6%  | 
|Of which Middle East                    |  |               | 647    |  |               |  | 556    |                          |  |  | +16.2%                          |  |  |  | +16.4% | 
|Other Countries****                     |  |               | 2,731  |  |               |  | 2,230  |                          |  |  | +22.5%                          |  |  |  | +11.5% | 
|Of which Japan                          |  |               | 1,844  |  |               |  | 1,408  |                          |  |  | +30.9%                          |  |  |  | +10.7% | 
|Total                                   |  |               | 29,306 |  |               |  | 27,568 |                          |  |  | +6.3%                           |  |  |  | +5.3%  | 



|* | France, Germany, United Kingdom, Italy, Spain, Greece, Cyprus, Malta, Belgium, Luxembourg,
Portugal, Netherlands, Austria, Switzerland, Sweden, Ireland, Finland, Norway, Iceland, Denmark.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|** | World excluding United States, Canada, Western Europe, Japan, Australia and New Zealand.
|-- | ----------------------------------------------------------------------------------------

|*** | Japan, Australia and New Zealand.
|--- | ---------------------------------

|**** | Japan, Canada, Australia and New Zealand.
|---- | -----------------------------------------



In 2009, net sales in Western Europe
decreased by 2.7% at constant exchange rates, reflecting the effect of the ongoing genericization of Eloxatine®
and Plavix®.



In the United States, the end of commercialization of Copaxone® by sanofi-aventis effective April 1, 2008 and the genericization of Eloxatine® during the second half of 2009 slowed the pace of net sales growth to 2.8% (at constant exchange rates). Lantus® and Lovenox®, with net sales
growth of 23.6% and 5.3% respectively (at constant exchange rates) were the principal growth drivers in Pharmaceuticals. Growth for the Vaccines business was boosted by sales of pandemic influenza vaccines (A(H1N1) and H5N1).



In Emerging Markets, net sales were 7,356 million,
an increase of 19.0% at constant exchange rates, due largely to strong growth in Eastern Europe (34.9% growth at constant exchange rates) where Zentivas sales were consolidated from April 1, 2009, and to the dynamism of Latin America
(up 15.7% at constant exchange rates), the Middle East (up 16.4% at constant exchange rates), China (up 28.8% at constant exchange rates) and Russia (up 59.8% at constant exchange rates). Net sales in Latin America (1,913 million) were
underpinned by good organic growth and by the acquisition of Medley in the second quarter of 2009.



Net sales in Japan reached 1,844 million (up 10.7% at constant exchange rates), driven by the performances
of Plavix®, Myslee® and Allegra®.



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##### Table of Contents

Worldwide Presence of Plavix® and Aprovel®



The table below sets forth the worldwide sales of Plavix® and Aprovel® in 2009 and 2008, by geographic region:



|                    |                    |      |       |        |      |  |       |                           |  |                    |                                |  |        |  |       |       |  |  |       |  |  |  |       |  |  |  |        |  |  |  |        | 
|------------------- | ------------------ | ---- | ----- | ------ | ---- |  | ----- | ------------------------- |  | ------------------ | ------------------------------ |  | ------ |  | ----- | ----- |  |  | ----- |  |  |  | ----- |  |  |  | ------ |  |  |  | ------ | 
|( million)         |                    | 2009 |       |        | 2008 |  |       | Change on
a reportedbasis |  |                    | Change atconstantexchangerates | 
|                    | sanofi-
aventis(2) |      |       | BMS(3) |      |  | Total |                           |  | sanofi-
aventis(2) |                                |  | BMS(3) |  |       | Total |  |  |      
|Plavix®/Iscover®(1) |                    |      |       |        |      |  |       |                           |  |                    |                                |  |        |  |       |       |  |  |       |  |  |  |       |  |  |  |        |  |  |  |        | 
|Europe              |                    |      | 1,443 |        |      |  | 161   |                           |  |                    | 1,604                          |  |        |  | 1,622 |       |  |  | 211   |  |  |  | 1,833 |  |  |  | -12.5% |  |  |  | -10.3% | 
|United States       |                    |      |      |        |      |  | 4,026 |                           |  |                    | 4,026                          |  |        |  |      |       |  |  | 3,351 |  |  |  | 3,351 |  |  |  | +20.1% |  |  |  | +12.8% | 
|Other countries     |                    |      | 897   |        |      |  | 255   |                           |  |                    | 1,152                          |  |        |  | 711   |       |  |  | 248   |  |  |  | 959   |  |  |  | +20.1% |  |  |  | +14.4% | 
|Total               |                    |      | 2,340 |        |      |  | 4,442 |                           |  |                    | 6,782                          |  |        |  | 2,333 |       |  |  | 3,810 |  |  |  | 6,143 |  |  |  | +10.4% |  |  |  | +6.2%  | 





|                                      |                    |      |       |        |      |  |       |                          |  |                    |                                |  |        |  |       |       |  |  |     |  |  |  |       |  |  |  |       |  |  |  |       | 
|------------------------------------- | ------------------ | ---- | ----- | ------ | ---- |  | ----- | ------------------------ |  | ------------------ | ------------------------------ |  | ------ |  | ----- | ----- |  |  | --- |  |  |  | ----- |  |  |  | ----- |  |  |  | ----- | 
|( million)                           |                    | 2009 |       |        | 2008 |  |       | Change ona reportedbasis |  |                    | Change atconstantexchangerates | 
|                                      | sanofi-
aventis(5) |      |       | BMS(3) |      |  | Total |                          |  | sanofi-
aventis(5) |                                |  | BMS(3) |  |       | Total |  |  |    
|Aprovel®/Avapro® /Karvea®/Avalide®(4) |                    |      |       |        |      |  |       |                          |  |                    |                                |  |        |  |       |       |  |  |     |  |  |  |       |  |  |  |       |  |  |  |       | 
|Europe                                |                    |      | 810   |        |      |  | 172   |                          |  |                    | 982                            |  |        |  | 816   |       |  |  | 176 |  |  |  | 992   |  |  |  | -1.0% |  |  |  | +0.8% | 
|United States                         |                    |      |      |        |      |  | 524   |                          |  |                    | 524                            |  |        |  |      |       |  |  | 499 |  |  |  | 499   |  |  |  | +5.0% |  |  |  | -1.6% | 
|Other countries                       |                    |      | 314   |        |      |  | 192   |                          |  |                    | 506                            |  |        |  | 291   |       |  |  | 184 |  |  |  | 475   |  |  |  | +6.5% |  |  |  | +7.2% | 
|Total                                 |                    |      | 1,124 |        |      |  | 888   |                          |  |                    | 2,012                          |  |        |  | 1,107 |       |  |  | 859 |  |  |  | 1,966 |  |  |  | +2.3% |  |  |  | +1.7% | 





|(1) | Plavix® is marketed under the trademarks Plavix® and Iscover®.
|--- | --------------------------------------------------------------

|(2) | Net sales of Plavix® consolidated by sanofi-aventis, excluding sales
to BMS (311 million in 2009 and 282 million in 2008).
|--- | ----------------------------------------------------------------------------------------------------------------------------

|(3) | Translated into euros by sanofi-aventis using the method described in Note B.2. Foreign currency translation to our consolidated
financial statements included at Item 18 in this annual report.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Aprovel® is marketed under the trademarks Aprovel®, Avapro®,
Karvea® and Avalide®.
|--- | ----------------------------------------------------------------------------------

|(5) | Net sales of Aprovel® consolidated by sanofi-aventis, excluding sales
to BMS (113 million in 2009 and 94 million in 2008).
|--- | ----------------------------------------------------------------------------------------------------------------------------



In the United States, sales of Plavix®/Iscover® (consolidated by
BMS) reported strong growth of 12.8% at constant exchange rates in 2009, reaching 4,026 million. In Europe, net sales of Plavix® were down 10.3% at constant exchange rates at 1,604 million due to the marketing of generics using alternative salts of clopidogrel, especially in the
United Kingdom, Germany and France (where we launched our own generic version, Clopidogrel Winthrop®, in the
fourth quarter of 2009). In Japan, Plavix® continued its success, with sales up 58.9% at constant exchange rates
to 339 million.



In a
competitive environment, 2009 worldwide sales of
Aprovel®/Avapro®/Karvea®/Avalide® were 2,012 million, an increase of 1.7% at constant exchange rates. In Europe, the product faced
competition from generics in the monotherapy segment in Spain and Portugal, and recorded sales growth of 0.8% at constant exchange rates.



Other Revenues



Other revenues, which mainly comprise royalty income under licensing agreements contracted in connection with ongoing operations, amounted
to 1,443 million in 2009 compared with 1,249 million in 2008.



Licensing revenues under the worldwide alliance with BMS on Plavix® and Aprovel® totaled
1,155 million in 2009, compared with 985 million in 2008 (up 17.3% on a reported basis), boosted by strong growth in sales of Plavix® in the United States and the favorable impact of trends in the exchange rate of the U.S. dollar against the euro.



Gross Profit



Gross profit for 2009 was 22,869 million (78.0%
of net sales), versus 21,480 million in 2008 (77.9% of net sales).



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The gross margin ratio for the Pharmaceuticals segment improved by 0.5 of a point,
reflecting the rise in royalty income (impact: +0.6 of a point) and an unfavorable trend in the ratio of cost of sales to net sales (impact: -0.1 of a point). This trend was the net result of:



| |  |  | the favorable effect on net sales and other revenues of movements in the exchange rates of various currencies against the euro (mainly the rise in the
U.S. dollar), which largely feeds through into gross profit because our cost of sales is largely incurred in the euro zone;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the favorable effect of the end of commercialization of Copaxone® by sanofi-aventis in North America, effective April 1, 2008;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------



| |  |  | a less favorable product mix due to the impact of acquisitions of companies that generate lower gross margins than we do (primarily on generics).
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------



The gross margin ratio for the
Vaccines segment was unchanged, with the effect of lower royalty income (impact: -0.5 of a point) offset by an improvement in the ratio of cost of sales to net sales (impact: +0.5 of a point) that was largely due to the appreciation of various
currencies against the euro.



Consolidated gross
profit was also impacted by the expense arising from the workdown during 2009 of inventories remeasured at fair value on completion of acquisitions (mainly Zentiva, impact 27 million or 0.1 of a point).



Research and Development Expenses



Research and development expenses were
4,583 million (versus 4,575 million in 2008), representing 15.6% of net sales (versus 16.6% in 2008); they were down 1.4% year-on-year at constant exchange rates, but up 0.2% on a reported basis.



Cost savings were achieved in the Pharmaceuticals segment due
to tight cost control and a reduction in clinical trial costs, reflecting the discontinuation of some projects following the portfolio review.



In the Vaccines segment, research and development expenses increased by 66 million, up 15.5%, in particular due to the
consolidation of Acambis from October 1, 2008 and to clinical trials related to influenza vaccines in the light of the pandemic.



Selling and General Expenses



Selling and general expenses totaled 7,325 million, compared with 7,168 million in the previous
year, an increase of 2.2% (or 1.1% at constant exchange rates). The ratio of selling and general expenses to net sales improved from 26.0% in 2008 to 25.0%, mainly because of savings in marketing expenses (in particular, due to the transfer of
commercialization of Copaxone® to Teva in North America in April 2008) and cost savings in Europe. The 2009
figure includes the expenses of companies consolidated for the first time during the year.



Selling and general expenses for the Vaccines segment rose by 7.9%. This increase was due primarily to the influenza pandemic, and to the consolidation of Acambis with effect from October 1, 2008.



Other Operating Income and Expenses



Other operating income for 2009 came to
866 million (versus 556 million in 2008), and other operating expenses amounted to 481 million (versus 353 million in 2008).



The balance of other operating income and
expenses represented net income of 385 million for 2009, compared with net income of 203 million for 2008. The 182 million increase was mainly due to the transfer of commercialization of Copaxone® to Teva in North America effective April 1, 2008. We were entitled to receive a 25% royalty of North American
sales of Copaxone® over a two-year period from that date, and recognized this royalty income in Other
operating income in 2008 and 2009.



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We also recognized gains on disposals relating to our ordinary operations of
56 million (compared with 24 million in 2008), and a net operating foreign exchange gain of 40 million (compared with a net foreign exchange loss of 94 million in 2008).



Amortization of Intangible Assets



Amortization charged against intangible assets in 2009
amounted to 3,528 million, versus 3,483 million in the previous year. The increase was due mainly to trends in the exchange rate of the U.S. dollar against the euro and the acquisition of Zentiva.



These charges mainly relate to the amortization of intangible
assets remeasured at fair value at the time of the Aventis acquisition (3,175 million in 2009, versus 3,298 million in 2008).



Impairment of Intangible Assets



Net impairment losses charged against intangible assets amounted to 372 million in 2009, and related
primarily to the impact of changes in the competitive environment and of generic approval dates on our products
Benzaclin®, Nasacort® and Actonel®. This item also
includes impairment losses of 28 million arising from the decision to discontinue the development of
TroVax®, and from the withdrawal of our product Di-Antalvic® from the market in response to a decision by the European Medicines Agency (EMA). With the exception of Trovax®, all of these products were recognized as assets in 2004 upon the acquisition of Aventis.



In 2008, this line item showed impairment
losses of 1,554 million charged against intangible assets due to the discontinuation of some research projects and to the genericization of some products marketed by the Group, originating mainly from Aventis. The main discontinued
research projects were those relating to larotaxel and cabazitaxel (new taxane derivatives developed in breast cancer, 1,175 million) and the antihypertensive ilepatril (57 million), both of which were recognized as assets on the
acquisition of Aventis; and the oral anti-cancer agent S-1, following termination of the agreement with Taiho Pharmaceutical for the development and commercialization of this product. In addition, an impairment loss of 114 million was
charged in respect of Nasacort® (also recognized as an asset on the acquisition of Aventis in 2004) following
the settlement agreement with Barr in the United States.



Restructuring Costs



Restructuring costs amounted to 1,080 million in 2009, compared with 585 million in 2008. In 2009, our restructuring costs related primarily to measures taken to improve innovation
by transforming our Research & Development operations, and to streamline our organizational structures by adapting central support functions. These costs consist mainly of employee-related charges, arising from early retirement benefits and
termination benefits under the announced voluntary redundancy plans. The 2009 charge also reflects, though to a lesser extent, ongoing measures to adapt our industrial facilities in Europe and to adjust our sales forces.



The restructuring costs recognized in 2008 related primarily
to the adaptation of industrial facilities in France and to measures taken in response to the changing economic environment in various European countries, principally France and Spain.



Gains and Losses on Disposals, and Litigation



Sanofi-aventis did not make any major disposals in either 2009 or 2008.



In 2008, this item included 76 million of reversal
of litigation provisions.



Operating Income



Operating income for 2009 was
6,366 million, 44.9% higher than the 2008 figure of 4,394 million.



Financial Income and Expenses



Net financial expense for 2009 was 300 million, compared to 232 million in 2008, an increase of 68 million.



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Interest expense directly related to our net debt (short-term and long-term debt, net of
cash and cash equivalents) amounted to 222 million, versus 183 million in 2008. Although the average level of net debt was lower in 2009 than in 2008, sanofi-aventis was adversely affected by lower interest rates on its cash
deposits (which averaged 5.0 billion in 2009, compared with 2.4 billion in 2008).



In 2008, we tendered our shares in Millennium Pharmaceuticals, Inc (Millennium) to the public tender offer for Millennium by Takeda Pharmaceuticals Company Ltd. This transaction generated a
38 million gain.



Net financial foreign
exchange losses for the year were 67 million, compared with 74 million in 2008.



Income before Tax and Associates and Joint Ventures



Net income before tax and associates and joint ventures for
2009 was 6,066 million, 45.7% higher than the 2008 figure of 4,162 million.



Income Tax Expense



The effective tax rate is calculated on the basis of business operating income minus net financial expenses and before the share of profit/loss of associates and joint ventures, net income from the
held-for-exchange Merial business, and net income attributable to non-controlling interests



The effective tax rate was 28.0% in 2009, compared to 29.0% in 2008, the reduction resulting directly from the entry into force in 2009 of a protocol to the tax treaty between France and the United States
that abolished withholding tax between the two countries subject to certain conditions. During 2009, this protocol resulted in the reversal through the consolidated income statement of 106 million in deferred tax liabilities relating to
the tax cost of distributions made out of the reserves of Group subsidiaries as of January 1, 2009. The difference between the effective tax rate and the standard corporate income tax rate applicable in France for 2009 (34%) was mainly due
to the impact of the reduced rate of income tax on royalties in France.



In 2008, this line item included a gain through the consolidated income statement of 221 million on reversals of tax provisions related to the settlement of tax audits.



Share of Profit/Loss of Associates and Joint Ventures



Our share of the profits
of associates and joint ventures was 814 million in 2009, versus 692 million in 2008. This item mainly comprises our share of after-tax profits from the territories managed by BMS under the Plavix® and Avapro® alliance, which increased by 26.0% year-on-year from 623 million in 2008 to 785 million in 2009. This increase was a direct result of the growth
in sales of Plavix® in the United States (up 12.8% at constant exchange rates) and of the appreciation of the
U.S. dollar against the euro (up 7.0%).



Net
Income from the Held-for-Exchange Merial Business



With effect from September 18, 2009, the date on which sanofi-aventis obtained exclusive control over Merial, the operations of this company have been accounted for using the full consolidation
method. As of December 31, 2009, the results of Merials operations were reported in the line item Net income from the held-for-exchange Merial business, in accordance with IFRS 5 (refer to Note D.8. to our consolidated
financial statements). The net income of the Merial business for the year ended December 31, 2009 was 175 million, compared with 120 million in the previous year.



This growth was attributable to a strong operating performance by Merial and to the appreciation of the U.S.
dollar against the euro. The figures cited above include 100% of the net income of Merial with effect from September 18, 2009, compared with 50% prior to that date. The 2009 figure also includes a net expense of 46 million relating
to the workdown of inventories remeasured at fair value, as part of the provisional purchase price allocation on the acquisition of the 50% interest in Merial acquired in 2009.



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Net Income



Net income (before non-controlling interests) totaled
5,691 million in 2009, compared with 4,292 million in 2008.



Net Income Attributable to Non-Controlling Interests



Net income attributable to non-controlling interests for the year ended December 31, 2009 was 426 million, against
441 million for the previous year. This item includes the share of pre-tax income paid over to BMS from territories managed by sanofi-aventis (405 million in 2009, versus 422 million in 2008).



Net Income Attributable to Equity Holders of
Sanofi-Aventis



Net income attributable to
equity holders of sanofi-aventis amounted to 5,265 million in 2009, versus 3,851 million in 2008. Basic earnings per share (EPS) for 2009 were 4.03, up 37.1% on the 2008 figure of 2.94, based on an average number of
shares outstanding of 1,305.9 million in 2009 and 1,309.3 million in 2008.



Diluted earnings per share for 2009 were 4.03, up 37.1% on the 2008 figure of 2.94, based on an average number of shares after dilution of 1,307.4 million in 2009 and 1,310.9 million
in 2008.



Business Operating Income



Business operating income for 2009 was
12,028 million, compared to 10,391 million in 2008. The table below shows trends in business operating income by business segment for 2009 and 2008:



|                          |  |      |        |  |      |  |        | 
|------------------------- |  | ---- | ------ |  | ---- |  | ------ | 
|( million)               |  | 2009 |        |  | 2008 | 
|Pharmaceuticals           |  |      | 10,608 |  |      |  | 9,399  | 
|Vaccines                  |  |      | 1,173  |  |      |  | 882    | 
|Other                     |  |      | 247    |  |      |  | 110    | 
|Business operating income |  |      | 12,028 |  |      |  | 10,391 | 



Business Net Income



Business net income is a non-GAAP financial measure that we use to evaluate our Groups performance (see  Business Net
Income above).



Business net income for 2009
was 8,629 million, versus 7,314 million in 2008, representing growth of 18.0%.



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|                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  |      |        |   |      |  |        |  
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---- | ------ | - | ---- |  | ------ | -
|( million)                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  | 2009 |        |   | 2008 | 
|Business net income                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  |      | 8,629  |   |      |  | 7,314  |  
|(i)                 Amortization of
intangible assets                                                                                                                                                                                                                                                                                                                                                                                                                |  |      | (3,528 | ) |      |  | (3,483 | )
|(ii)                Impairment of intangible
assets                                                                                                                                                                                                                                                                                                                                                                                                                  |  |      | (372   | ) |      |  | (1,554 | )
|(iii)              Expenses arising from the impact of
acquisitions on inventories(1)                                                                                                                                                                                                                                                                                                                                                                                |  |      | (27    | ) |      |  | (2     | )
|(iv)               Restructuring costs                                                                                                                                                                                                                                                                                                                                                                                                                               |  |      | (1,080 | ) |      |  | (585   | )
|(iii)/(iv)      Other items(2)                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |      |       |   |      |  | 114    |  
|(v)                Tax effects
of:                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |      | 1,629  |   |      |  | 1,904  |  
|- amortization of
intangible assets                                                                                                                                                                                                                                                                                                                                                                                                                                  |  |      | 1,126  |   |      |  | 1,189  |  
|- impairment of
intangible assets                                                                                                                                                                                                                                                                                                                                                                                                                                    |  |      | 136    |   |      |  | 537    |  
|- expenses arising
from the impact of acquisitions on inventories                                                                                                                                                                                                                                                                                                                                                                                                    |  |      | 7      |   |      |  | 1      |  
|- restructuring
costs                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |      | 360    |   |      |  | 196    |  
|- other
items                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  |      |       |   |      |  | (19    | )
|(iii)/(vi)      Other tax items(3)                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |      | 106    |   |      |  | 221    |  
|(vii)             Share of items listed above attributable to
non-controlling interests                                                                                                                                                                                                                                                                                                                                                                              |  |      | 1      |   |      |  |       |  
|(iii)              Expenses arising from the impact of the
Merial acquisition(4)                                                                                                                                                                                                                                                                                                                                                                                     |  |      | (66    | ) |      |  | (50    | )
|(iii)/(iv)      Restructuring costs of associates and joint
ventures, and expenses arising from
the impact of acquisitions on associates and joint ventures(5)                                                                                                                                                                                                                                                                                                       |  |      | (27    | ) |      |  | (28    | )
|Net income attributable to equity holders of sanofi-aventis                                                                                                                                                                                                                                                                                                                                                                                                          |  |      | 5,265  |   |      |  | 3,851  |  
|(1)     This
line comprises the workdown of inventories remeasured at fair value at the acquisition date.                                                                                                                                                                                                                                                                                                                                                            | 
|(2)     Other
items comprise :                                                                                                                                                                                                                                                                                                                                                                                                                                       | 
|- gain on sale of investment in Millennium                                                                                                                                                                                                                                                                                                                                                                                                                           |  |      |        |   |      |  | 38     |  
|- reversals of/charges to provisions for risks                                                                                                                                                                                                                                                                                                                                                                                                                       |  |      |        |   |      |  | 76     |  
|(3)     Other tax items
comprise :                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |      |        |   |      |  |        |  
|- provisions for/settlements of tax disputes                                                                                                                                                                                                                                                                                                                                                                                                                         |  |      |        |   |      |  | 221    |  
|- reversal of deferred taxes following ratification of the Franco-American
Treaty                                                                                                                                                                                                                                                                                                                                                                                    |  |      | 106    |   |      |  |        |  
|(4)     This
line comprises: until September 17, 2009, amortization and impairment charged against the intangible assets of Merial; and from September 18, 2009, (i) the impact of the discontinuation of depreciation of the property, plant and
equipment of Merial in accordance with IFRS 5 (see Note B.7. to our consolidated financial statements) and (ii) the expense arising from the workdown of inventories remeasured at fair value at acquisition date. | 
|(5)     This
line shows the portion of major restructuring costs incurred by associates and joint ventures, and expenses arising from the impact of acquisitions on associates and joint ventures (workdown of acquired inventories, amortization and impairment of
intangible assets, and impairment of goodwill).                                                                                                                                                  | 



Business net income for 2009
was 8,629 million, an increase of 18.0% on the 2008 figure of 7,314 million, and represented 29.4% of net sales compared with 26.5% in 2008. The increase was mainly due to our good operating performance, reflected in the
increase in gross profit (22,869 million in 2009 versus 21,480 million in 2008).



Business Earnings Per Share



We also report business earnings per share, a non-GAAP financial measure which we define as business net income divided by the weighted average number of shares outstanding (see  Business Net
Income above).



Business earnings per share
for 2009 were 6.61, up 18.2% on the 2008 business earnings per share figure of 5.59. The weighted average number of shares outstanding was 1,305.9 million in 2009 and 1,309.3 million in 2008. Diluted business earnings per share
for 2009 were 6.60, up 18.3% on the 2008 diluted business earnings per share figure of 5.58. On a diluted basis, the weighted average number of shares outstanding was 1,307.4 million in 2009 and 1,310.9 million in 2008.



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Liquidity and Capital Resources



Our operations generate significant positive cash flows. We
fund our investments primarily with operating cash flow, and pay regular dividends on our shares. In 2010, we also reduced our net debt. As of December 31, 2010, our debt, net of cash and cash equivalents, stood at 1,577 million
(3.0% of our net equity) versus 4,128 million as of December 31, 2009 (8.5% of our net equity) and 1,802 million as of December 31, 2008. See Note D.17. to our consolidated financial statements included at
Item 18 of this annual report. We expect to significantly increase our net debt in 2011 in connection with our proposed acquisition of Genzyme.



Consolidated Statement of Cash Flows



The table below shows our summarized cash flows for the years ended December 31, 2010, 2009 and 2008:



|                                                                |  |      |        |   |      |  |        |      |  |  |        |  
|--------------------------------------------------------------- |  | ---- | ------ | - | ---- |  | ------ | ---- |  |  | ------ | -
|( million)                                                     |  | 2010 |        |   | 2009 |  |        | 2008 | 
|Net cash provided by / (used in) operating activities           |  |      | 9,759  |   |      |  | 8,515  |      |  |  | 8,523  |  
|Net cash provided by / (used in) investing activities           |  |      | (3,383 | ) |      |  | (7,287 | )    |  |  | (2,154 | )
|Net cash provided by / (used in) financing activities           |  |      | (4,647 | ) |      |  | (787   | )    |  |  | (3,809 | )
|Impact of exchange rates on cash and cash equivalents           |  |      | 44     |   |      |  | 25     |      |  |  | (45    | )
|Net change in cash and cash equivalents  (decrease) /
increase |  |      | 1,773  |   |      |  | 466    |      |  |  | 2,515  |  



Generally, factors that affect our earnings  for example, pricing, volume, costs and exchange rates  flow through to cash from
operations. The most significant source of cash from operations is sales of our branded pharmaceutical products and human vaccines. Receipts of royalty payments also contribute to cash from operations.



Year Ended December 31, 2010 Compared with Year Ended
December 31, 2009



Net cash provided
by operating activities amounted to 9,759 million in 2010, compared with 8,515 million in 2009. Operating cash flow before changes in working capital was 10,036 million, versus 9,362 million in 2009,
reflecting our operating performance.



Our
operating cash flow before changes in working capital is generally affected by the same factors that affect Operating income, which is discussed in detail above under Results of Operations  Year Ended December 31, 2010
Compared with Year Ended December 31, 2009 and Results of Operations  Year Ended December 31, 2009 Compared with Year Ended December 31, 2008. The principal difference is that operating cash flow before changes
in working capital reflects our share of the profits and losses of associates and joint ventures, net of dividend and similar income received.



Working capital requirements rose by 277 million in 2010, compared with an 847 million increase
in 2009. The main factor in 2010 was a 378 million rise in inventories, partly offset by the discontinuation of royalty payments from Teva on North American sales of Copaxone® (impact: 126 million).



Net cash used in investing activities totaled 3,383 million in 2010, versus 7,287 million in 2009.



Acquisitions of property, plant and equipment and
intangible assets amounted to 1,573 million (2009: 1,785 million), comprising 1,261 million of investments in industrial and research facilities and 312 million of contractual payments for intangible rights
under license agreements.



Acquisitions of
investments during 2010 totaled 1,733 million, net of acquired cash; after including assumed liabilities and commitments, these acquisitions were valued at 2,130 million. Our main investments during 2010 were the equity interests in
Chattem (1,640 million) and Nepentes (104 million). In 2009, acquisitions of investments were 5,568 million, net of acquired cash; after including assumed liabilities and commitments, these acquisitions were valued at
6,334 million. Our main investments in 2009 were the equity interests in Merial (2,829 million), Zentiva (1,752 million), Shantha, Medley, and BiPar.



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After-tax proceeds from disposals amounted to 131 million, arising mainly on the
divestment of the equity interest in Novexel (48 million) and on the disposal of various items of property, plant and equipment (55 million). In 2009, after-tax proceeds from disposals were 85 million, mainly on disposals of
intangible assets, some of which were required as conditions for clearance of our acquisition of Zentiva.



Net cash used in financing activities amounted to 4,647 million in 2010, versus 787 million in 2009.



The 2010 figure includes our dividend payout of
3,131 million (2009: 2,872 million), plus net repayments of debt (net change in short-term and long-term debt) of 1,166 million (versus a net 1,923 million of new debt contracted in 2009). It also includes the
acquisition of 5.9 million of our own shares for 321 million.



After the impact of exchange rates, the net change in cash and cash equivalents during 2010 was an increase of 1,773 million, compared with an increase of 466 million in 2009.



Year Ended December 31, 2009 Compared
with Year Ended December 31, 2008



Net cash provided by operating activities totaled 8,515 million in 2009, compared with 8,523 million in 2008.
Operating cash flow before changes in working capital was 9,362 million (versus 8,524 million in 2008), reflecting our good operating performance.



Our working capital requirements increased by
847 million in 2009, having been stable in 2008. This increase was due to the growth in our operations during 2009, reflected in higher levels of inventories (up 489 million) and trade receivables (up 429 million).



Net cash used in investing activities was
7,287 million in 2009, versus 2,154 million in 2008.



Acquisitions of property, plant and equipment and intangible assets totaled 1,785 million (compared with 1,606 million in 2008), and mainly comprised investments in industrial
facilities and research sites, plus contractual payments for intangible rights (325 million in 2009, mainly related to licensing agreements).



Acquisitions of investments during 2009 totaled 5,568 million, net of cash acquired. These investments, valued at a total of
6,334 million inclusive of assumed liabilities and commitments, mainly comprised acquisitions of shares in Merial (2,829 million), Zentiva (1,752 million), Shantha, Medley and BiPar. In 2008, acquisitions of investments
net of cash acquired totaled 667 million, mainly comprising the acquisitions of the entire share capital of the U.K. company Acambis Plc (332 million) and of the Australian company Symbion CP Holdings Pty Ltd, now sanofi-aventis
Healthcare Holdings Pty Limited (329 million).



After-tax proceeds from disposals (85 million in 2009) related mainly to disposals of intangible assets, some of which were required as conditions for clearance of our acquisition of Zentiva. In
2008, after-tax proceeds from disposals were 123 million, mostly arising from the May 2008 disposal of our shares in Millennium.



Net cash used in financing activities amounted to 787 million, against 3,809 million in 2008. The 2009 figure
includes a dividend payout of 2,872 million (versus 2,702 million in 2008), and additional external financing (net increase in short-term and long-term debt) of 1,923 million (versus 69 million in 2008).
During 2009, we placed five bond issues for a total amount of 4.7 billion. In 2008, we acquired 23.9 million of our own shares at a cost of 1,227 million under our share repurchase programs.



After the impact of exchange rates, the net change in cash
and equivalents during 2009 was an increase of 466 million, compared with an increase of 2,515 million in 2008.



Consolidated Balance Sheet and Debt



Total assets stood at 85,264 million as of December 31, 2010, compared with 80,251 million as of
December 31, 2009, an increase of 5,013 million. Total assets as of December 31, 2009 have been adjusted to reflect adjustments to the values of certain identifiable assets and liabilities of Merial (see Note D.1. to our
consolidated financial statements included at Item 18 of this annual report).



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Our debt, net of cash and cash equivalents was 1,577 million as of
December 31, 2010, versus 4,128 million as of December 31, 2009. We define debt, net of cash and cash equivalents as short-term and long-term debt, plus related interest rate and currency derivatives, minus cash and
cash equivalents.



The table below shows our
financial position for the years ended December 31, 2010, 2009 and 2008:



|                                                      |  |      |        |   |      |  |        |      |  |  |        |  
|----------------------------------------------------- |  | ---- | ------ | - | ---- |  | ------ | ---- |  |  | ------ | -
|( million)                                           |  | 2010 |        |   | 2009 |  |        | 2008 | 
|Long-term debt                                        |  |      | 6,695  |   |      |  | 5,961  |      |  |  | 4,173  |  
|Short-term debt and current portion of long-term debt |  |      | 1,565  |   |      |  | 2,866  |      |  |  | 1,833  |  
|Related interest rate and currency derivatives        |  |      | (218   | ) |      |  | (7     | )    |  |  | 22     |  
|Cash and cash equivalents                             |  |      | (6,465 | ) |      |  | (4,692 | )    |  |  | (4,226 | )
|Debt, net of cash and cash equivalents                |  |      | 1,577  |   |      |  | 4,128  |      |  |  | 1,802  |  



The gearing ratio (debt, net of cash and cash equivalents as a proportion of total equity) fell from 8.5% to 3.0%. For an analysis of our
debt by type, maturity, interest rate and currency as of December 31, 2010 and December 31, 2009, refer to Note D.17. to our consolidated financial statements.



The financing arrangements in place as of December 31,
2010 at the sanofi-aventis parent company level are not subject to covenants regarding financial ratios and do not contain any clauses linking credit spreads or fees to our credit rating. Under the Bridge Facility, the margin above LIBOR and
mandatory costs may vary under Facility B as a function of our credit rating (see Item 10.C. hereof for further information.).



Other key movements in balance sheet items are described below.



Total equity stood at 53,288 million as of
December 31, 2010, compared with 48,580 million a year earlier. The main factors underlying this net increase were as follows:



| |  |  | increases: net income for the year ended December 31, 2010 (5,721 million), and the change in cumulative translation differences due to the
depreciation of the euro against other currencies (2,655 million, mainly on the U.S. dollar); and
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | reductions: the dividend payout of 3,131 million made to our shareholders in 2010.
| | - |  | -----------------------------------------------------------------------------------



As of December 31, 2010, sanofi-aventis held
6.1 million of its own shares, representing 0.5% of the share capital and recorded as a deduction from equity.



Goodwill and other intangible assets (44,411 million) increased by 931 million compared to a year earlier, mainly as a
result of the following factors:



| |  |  | increases: acquisitions of companies (1,017 million of goodwill, and 1,557 million of other intangible assets) plus acquisitions of
intangible assets (388 million);
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | reductions: amortization and impairment losses charged during the year (4,011 million); and
| | - |  | --------------------------------------------------------------------------------------------



| |  |  | the translation into euros of assets denominated in other currencies (positive impact of 1,979 million, mainly on the U.S. dollar).
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------



Provisions and other
non-current liabilities (9,326 million) were 1,090 million higher than at the previous year-end, due largely to a sharp increase of 731 million in restructuring provisions.



Net deferred tax liabilities (757 million) were
1,264 million lower year-on-year, mainly as a result of reversals of deferred tax liabilities relating to amortization and impairment of acquired intangible assets (impact: 1,324 million).



Liabilities related to business combinations and to
non-controlling interests (current and non-current) rose by 335 million to 486 million, due mainly to contingent consideration relating to acquisitions (primarily Fovea and TargeGen) and to put options granted to
non-controlling interests (see Note D.18. to our consolidated financial statements).



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Assets held for sale or exchange, net of related liabilities rose by 321 million
to 5,364 million during the year, and mainly comprise the net assets of Merial which are reported separately in accordance with IFRS 5 (see Note D.8. to our consolidated financial statements).



Liquidity



We expect that our existing cash resources and cash from
operations will be sufficient to finance our foreseeable working capital requirements. At year end 2010, we held cash and cash equivalents amounting to 6,465 million, substantially all of which was held in euros (see Note D.13. to our
consolidated financial statements). As at December 31, 2010, 436 million of our cash and cash equivalents was held by our captive insurance and reinsurance companies in accordance with insurance regulations.



At year end 2010, we had a firm commitment of approximately
$18.5 billion towards the shareholders of Genzyme Corporation (Genzyme), based on the tender offer made on October 4, 2010 for all outstanding shares of common stock at $69.00 per share, net to the seller in cash, without interest and less
any required withholding taxes. On February 16, 2011, sanofi-aventis and Genzyme announced they had entered into a merger agreement providing for the acquisition of Genzyme by sanofi-aventis. The agreement is described at Item 10.C. Material
Contracts and any acquisition remains subject to fulfillment of a number of conditions including acceptance by holders of a majority of shares of Genzyme common stock on a diluted basis. The cash consideration (excluding any future payments on
the contingent value rights that we propose to issue in connection with the acquisition) of the agreed offer represents a commitment of approximately $20.1 billion on the basis of an estimated 272.5 million Genzyme shares on a diluted basis.



At year end 2010, we had a firm commitment of
$1 billion towards Merck & Co., Inc. relating to the future combination of Merial with the Intervet/Schering-Plough business to form a new joint venture equally owned by Merck and sanofi-aventis, as well as a firm commitment of
$521 million towards the shareholders of BMP Suntone Corporation (BMP Sunstone). See  Acquisitions above for further details.



At year end 2010, other than the preceeding commitments relating to Genzyme, Merial and BMP Sunstone, we had no commitments for capital
expenditures that we consider to be material to our consolidated financial position.



Undrawn confirmed credit facilities amounted to a total of 12.2 billion at December 31, 2010. Moreover, in connection with the Genzyme acquisition, we signed two acquisition facilities in
October 2010 for a total value of 11.2 billion ($15 billion) that can be drawn until December 31, 2011 (see Item 10. Additional Information  C. Material Contracts). In order to have sufficient cash on hand to
pay for the contemplated acquisition of 100% of the shares of Genzyme common stock, we intend to either draw on these facilities in whole or in part and/or issue new debt upon closing of the acquisition, depending on market conditions. For a
discussion of our treasury policies, see Item 11. Quantitative and Qualitative Disclosures about Market Risk.



We expect that cash from the combined operations of sanofi-aventis and Genzyme would be sufficient to repay our debt, including the new
debt that we expect to contract in 2011 (including refinancing of any drawings under the Acquisition Facility) in order to finance the contemplated Genzyme acquisition. For a discussion of our liquidity risks, see Item 11. Quantitative and
Qualitative Disclosures about Market Risk.



Off-Balance
Sheet Arrangements / Contractual Obligations and Other Commercial Commitments



We have various contractual obligations and other commercial commitments arising from our operations. Our contractual obligations and our other commercial commitments as of December 31, 2010 are
shown in Notes D.3., D.17., D.18. and D.21. to our consolidated financial statements included at Item 18 of this annual report. Note D.21. to our consolidated financial statements included at Item 18 discloses details of commitments under our
principal research and development collaboration agreements, as well as the financial commitments related to Merial, Genzyme and BMP Sunstone. For a description of the principal contingencies arising from certain business divestitures, refer to Note
D.22.e) to our 2010 consolidated financial statements.



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The Groups contractual obligations and other commercial commitments (excluding those
of Merial, see Note D.8.1. to our consolidated financial statements) are set forth in the table below:



|                                                                                    |  |                        |        |   |              |  |        |                  |  |  |                   |   |  |             |       |   |  |  |       |  
|----------------------------------------------------------------------------------- |  | ---------------------- | ------ | - | ------------ |  | ------ | ---------------- |  |  | ----------------- | - |  | ----------- | ----- | - |  |  | ----- | -
|December 31, 2010                                                                   |  | Payments due by period |       
|( million)                                                                         |  | Total                  |        |   | Under 1
year |  |        | From 1 to3 years |  |  | From 3 to
5 years |   |  | Over 5years |      
|    Future contractual cash-flows relating to debt and debt hedging instruments(1) |  |                        | 9,125  |   |              |  | 1,694  |                  |  |  | 3,161             |   |  |             | 1,736 |   |  |  | 2,534 |  
|    Operating lease obligations                                                    |  |                        | 1,291  |   |              |  | 260    |                  |  |  | 337               |   |  |             | 217   |   |  |  | 477   |  
|    Finance lease
obligations(2)                                                   |  |                        | 28     |   |              |  | 7      |                  |  |  | 13                |   |  |             | 6     |   |  |  | 2     |  
|    Irrevocable purchase commitments(3)                                            |  |                        |        |   |              |  |        |                  |  |  |                   |   |  |             |       |   |  |  |       |  
|  given                                                                            |  |                        | 2,658  |   |              |  | 1,566  |                  |  |  | 498               |   |  |             | 207   |   |  |  | 387   |  
|  received                                                                         |  |                        | (176   | ) |              |  | (74    | )                |  |  | (35               | ) |  |             | (16   | ) |  |  | (51   | )
|    Research & development license agreements                                      |  |                        |        |   |              |  |        |                  |  |  |                   |   |  |             |       |   |  |  |       |  
|-  Future service commitments(4)                                                    |  |                        | 1,073  |   |              |  | 199    |                  |  |  | 312               |   |  |             | 252   |   |  |  | 310   |  
|-  Potential milestone payments(5)                                                  |  |                        | 2,015  |   |              |  | 101    |                  |  |  | 378               |   |  |             | 238   |   |  |  | 1,298 |  
|    Obligations relating to business combinations(6)                               |  |                        | 739    |   |              |  | 87     |                  |  |  | 79                |   |  |             | 438   |   |  |  | 135   |  
|Total contractual obligations and other commitments                                 |  |                        | 16,753 |   |              |  | 3,840  |                  |  |  | 4,743             |   |  |             | 3,078 |   |  |  | 5,092 |  
|                                                                                    |  |                        |        |   |             
|Undrawn general-purpose credit facilities                                           |  |                        | 12,238 |   |              |  | 245    |                  |  |  | 5,755             |   |  |             | 6,238 |   |  |  |      |  
|Genzyme acquisition facilities                                                      |  |                        | 11,226 |   |              |  | 11,226 |                  |  |  |                  |   |  |             |      |   |  |  |      |  
|Total undrawn credit facilities                                                     |  |                        | 23,464 |   |              |  | 11,471 |                  |  |  | 5,755             |   |  |             | 6,238 |   |  |  |      |  



|(1) | See
Note D.17. to our consolidated financial statements included at Item 18 of this annual report.
|--- | --------------------------------------------------------------------------------------------------

|(2) | See
Note D.3. to our consolidated financial statements included at Item 18 of this annual report.
|--- | -------------------------------------------------------------------------------------------------

|(3) | These comprise irrevocable commitments to suppliers of (i) property, plant
and equipment, net of down payments (see Note D.3. to our consolidated financial statements included at Item 18 of this annual report) and (ii) goods and services.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Future service commitments relating to research & development license
agreements mainly comprise research financing commitments, but also include consideration for access to technologies.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(5) | This line includes all potential milestone payments on projects regarded as
reasonably possible, i.e., on projects in the development phase. Payments contingent upon the attainment of sales targets once a product is on the market are excluded.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(6) | See Note D.18. to our consolidated financial statements included at Item 18 of
this annual report.
|--- | --------------------------------------------------------------------------------------------------



We may have payments due to our current or former research and development partners under collaborative agreements. These agreements
typically cover multiple products, and give us the option to participate in development on a product-by-product basis. When we exercise our option with respect to a product, we pay our collaboration partner a fee and receive intellectual property
rights to the product in exchange. We also are generally required to fund some or all of the development costs for the products that we select, and to make payments to our partners when those products reach development milestones.



We have entered into collaboration agreements under which we
have rights to acquire products or technology from third parties through the acquisition of shares, loans, license agreements, joint development, co-marketing and other contractual arrangements. In addition to upfront payments on signature of the
agreement, our contracts frequently require us to make payments contingent upon the completion of development milestones by our alliance partner or upon the granting of approvals or licenses.



Because of the uncertain nature of development work, it is impossible to predict (i) whether
sanofi-aventis will exercise further options for products, or (ii) whether the expected milestones will be achieved, or (iii) the number of compounds that will reach the relevant milestones. It is therefore impossible to estimate the
maximum aggregate amount that sanofi-aventis will actually pay in the future under existing collaboration agreements.



Given the nature of its business, it is highly unlikely that sanofi-aventis will exercise all options for all products or that all
milestones will be achieved.



The main
collaboration agreements relating to development projects in the Pharmaceuticals segment are described below. Potential milestone payments relating to development projects under these agreements amounted to 1.4 billion in 2010.



| |  |  | In June 2010, sanofi-aventis and Metabolex signed a global license agreement for MBX-2982, an oral agent for the treatment of type 2 diabetes.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------



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| |  |  | In May 2010, sanofi-aventis signed a license agreement with Glenmark Pharmaceuticals S.A., a wholly-owned subsidiary of Glenmark Pharmaceuticals
Limited India.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In April 2010, sanofi-aventis signed a global license agreement with CureDM Group Holdings, LLC for Pancreate, a novel human peptide which could
restore a patients ability to produce insulin and other pancreatic hormones in both type 1 and 2 diabetes.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In December 2009, sanofi-aventis and the U.S. biotechnology company Alopexx Pharmaceuticals LLC simultaneously signed (i) a collaboration
agreement, and (ii) an option for a license on an antibody for the prevention and treatment of infections originating in the bacterium that causes plague and other serious infections.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | At end September 2009, sanofi-aventis and Merrimack Pharmaceuticals Inc. signed an exclusive global licensing and collaboration agreement covering the
MM-121 molecule for the management of solid malignancies.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In May 2009, sanofi-aventis signed a global license agreement in oncology with the biotechnology company Exelixis, Inc. for XL147 and XL765, and
simultaneously signed an exclusive research collaboration agreement for the discovery of inhibitors of Phosphoinositide-3 Kinase (PI3K) for the management of malignant tumors.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In September 2003, sanofi-aventis signed a collaboration agreement in oncology with Regeneron Pharmaceuticals Inc. (Regeneron) to develop the Vascular
Endothelial Growth Factor (VEGF) Trap program. Under the terms of the agreement, sanofi-aventis will pay 100% of the development costs of the VEGF Trap. Once a VEGF Trap product starts to be marketed, Regeneron will repay 50% of the development
costs (originally paid by sanofi-aventis) in accordance with a formula based on Regenerons share of the profits.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In November 2007, sanofi-aventis signed another collaboration agreement with Regeneron to discover, develop and commercialize fully-human therapeutic
antibodies. This agreement was broadened, and its term extended; on November 10, 2009. Under the terms of the development agreement, sanofi-aventis committed to fund 100% of the development costs of Regenerons antibody research
program until 2017. Once a product begins to be marketed, Regeneron will repay out of its profits (provided they are sufficient) half of the development costs borne by sanofi-aventis.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Sanofi-aventis has also entered into the following major
agreements, which are currently in a less advanced research phase:



| |  |  | December 2010: a global licensing and patent transfer agreement with Ascendis Pharma (Ascendis) on the proprietary Transcon Linker and Hydrogel Carrier
technology developed by Ascendis for precise, time-controlled release of therapeutic active ingredients into the body. The agreement will enable sanofi-aventis to develop, manufacture and commercialize products combining this technology with active
molecules for the treatment of diabetes and related disorders.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | December 2010: alliance with Avila TherapeuticsInc. (Avila) to discover target covalent drugs for the treatment of cancers, directed towards six signaling proteins
that are critical in tumor cells. Under the terms of the agreement, sanofi-aventis will have access to Avilas proprietary AvilomicsTMplatform offering protein silencing for these pathogenic proteins.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | December 2010: an exclusive global licensing option with Oxford BioTherapeutics for three existing antibodies, plus a research and collaboration
agreement to discover and validate new targets in oncology.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | September 2010: alliance with the Belfer Institute of Applied Cancer Science at the Dana-Farber Cancer Institute (DFCI) to identify novel targets in
oncology for the development of new therapeutic agents directed towards these targets and their associated biomarkers. Under the terms of the agreement, sanofi-aventis will have access to the Belfer Institutes anticancer target identification
and validation platform and to its translational medicine resources. Sanofi-aventis also has an option over an exclusive license to develop, manufacture and commercialize novel molecules directed towards the targets identified and validated under
this research collaboration.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| |  |  | June 2010: alliance with Regulus Therapeutics Inc. to discover, develop and commercialize novel micro-RNA therapeutics, initially in fibrosis.
Sanofi-aventis also received an option, which if exercised, would provide access to the technology to develop and commercialize other micro-RNA based therapeutics, beyond the first four targets.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | June 2010: exclusive global collaboration and license agreement with Ascenta Therapeutics, a U.S. biopharmaceutical company, on a number of molecules
that could restore apoptosis (cell death) in tumor cells.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | October 2009: agreement with Micromet, Inc. to develop a BiTE® antibody against a tumor antigen present at the surface of carcinoma cells.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | May 2009: collaboration and licensing agreement with Kyowa Hakko Kirin Co., Ltd., under which sanofi-aventis obtained the worldwide rights to the
anti-LIGHT fully human monoclonal antibody. This anti-LIGHT antibody is presently at preclinical development stage, and is expected to be first-in-class in the treatment of ulcerative colitis and Crohns disease.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In the Vaccines segment, sanofi pasteur has entered into a
number of collaboration agreements. Milestone payments relating to development projects under those agreements amounted to 0.3 billion in 2010.



In December 2009, sanofi pasteur signed a donation letter to the World Health Organization (WHO). The terms of the agreement committed
sanofi pasteur to donate 10% of its future output of vaccines against A(H1N1), A(H5N1) or any other influenza strain with pandemic potential, up to a maximum of 100 million doses. Since this agreement was put in place, sanofi pasteur has
already donated to the WHO some of the doses covered by the commitment.



Critical accounting and reporting policies



Our consolidated financial statements are affected by the accounting and reporting policies that we use. Certain of our accounting and reporting policies are critical to an understanding of our results of
operations and financial condition, and in some cases the application of these critical policies can be significantly affected by the estimates, judgments and assumptions made by management during the preparation of our consolidated financial
statements. The accounting and reporting policies that we have identified as fundamental to a full understanding of our results of operations and financial condition are the following:



| |  |  | Revenue recognition. Our policies with respect to revenue recognition are discussed in Note B.14. to our consolidated financial statements
included at Item 18 of this annual report. Revenue arising from the sale of goods is presented in the income statement under Net sales. Net sales comprise revenue from sales of pharmaceutical products, vaccines, and active
ingredients, net of sales returns, of customer incentives and discounts, and of certain sales-based payments paid or payable to the healthcare authorities. Revenue is recognized when all of the following conditions have been met: the risks and
rewards of ownership have been transferred to the customer; the Group no longer has effective control over the goods sold; the amount of revenue and costs associated with the transaction can be measured reliably; and it is probable that the economic
benefits associated with the transaction will flow to the Group.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



We offer various types of price reductions on our products. In particular, products sold in the United States are covered by various programs (such as Medicare and Medicaid) under which products are sold
at a discount. Rebates are granted to healthcare authorities, and under contractual arrangements with certain customers. Some wholesalers are entitled to chargeback incentives based on the selling price to the end customer, under specific
contractual arrangements. Cash discounts may also be granted for prompt payment. The discounts, incentives and rebates described above are estimated on the basis of specific contractual arrangements with our customers or of specific terms of the
relevant regulations and/or agreements applicable for transactions with healthcare authorities, and of assumptions of the attainment of sales targets. They are recognized in the period in which the underlying sales are recognized, as a reduction of
sales revenue. We also estimate the amount of product returns, on the basis of contractual sales terms and reliable historical data; the same recognition principles apply to sales returns. For additional details regarding the financial impact of
discounts, rebates and sales returns, see Note D.23. to our consolidated financial statements included at Item 18 of this annual report.



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Non-product revenues, mainly comprising royalty income from license arrangements that
constitute ongoing operations of the Group, are presented in Other revenues.



| |  |  | Business combinations. As discussed in Note B.3. Business combinations and transactions with non-controlling interests to our
consolidated financial statements included at Item 18 of this annual report, business combinations are accounted for by the acquisition method. The acquirees identifiable assets, liabilities and contingent liabilities that satisfy the
recognition criteria of IFRS 3 Business combinations are measured initially at their fair values as at the acquisition date, except for non-current assets classified as held for sale, which are measured at fair value less costs to
sell. Business combinations completed on or after January 1, 2010 are accounted for in accordance with the revised IFRS 3 and the revised IAS 27, Consolidated and individual financial statements. In particular, contingent
consideration to former owners agreed in a business combination, e.g. in the form of milestone payments upon the achievement of certain R&D milestones, is recognized as a liability at fair value as of the acquisition date. Any subsequent changes
in amounts recorded as a liability are recognized in the consolidated income statement.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Goodwill impairment and intangible assets. As discussed in Note B.6. Impairment of property, plant and equipment, intangible assets, and
investments in associates and joint ventures and in Note D.5. Impairment of intangible assets and property, plant and equipment to our consolidated financial statements included at Item 18 of this annual report, we test our
intangible assets periodically for impairment. The most significant intangible assets that we test for impairment are those resulting from the business combination of Sanofi-Synthélabo and Aventis in 2004. We test for impairment on the basis
of the same objective criteria that were used for the initial valuation. Our initial valuation and ongoing tests are based on the relationship of the value of our projected future cash flows associated with the asset to either the purchase price of
the asset (for its initial valuation) or the carrying amount of the asset (for ongoing tests). The determination of the underlying assumptions relating to the recoverability of intangible assets is subjective and requires the exercise of
considerable judgment. Key assumptions relating to goodwill impairment and intangible assets are the perpetual growth rate and the post-tax discount rate. Any changes in key assumptions could result in an impairment charge. A sensitivity analysis to
the key assumptions is performed and disclosed in Note D.5. Impairment of intangible assets and property, plant and equipment to our consolidated financial statements included at Item 18 of this annual report.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Pensions and post-retirement benefits. As described in Note B.23. Employee benefit obligations to our consolidated financial
statements included at Item 18 of this annual report, we recognize our pension and retirement benefit commitments as liabilities on the basis of an actuarial estimate of the potential rights vested in employees and retirees as of the balance
sheet date, net of the valuation of funds to meet these obligations. We prepare this estimate at least on an annual basis, taking into account actuarial assumptions, including life expectancy, staff turnover, salary growth, long-term return on plan
assets, retirement and discounting of amounts payable. Pensions and post-retirement benefits key assumptions are the discount rate and the expected long term rate of return on plan assets.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Depending on the discount rate used, the pension and
post-retirement benefit expense could vary within a range of outcomes and have a material effect on equity because in applying IAS 19 (Employee Benefits), we have elected to recognize all actuarial gains and losses (including the impact of a change
in discount rate) immediately through equity. A sensitivity analysis to discount rate is performed in Note D.19.1. Provisions for pensions and other benefits to our consolidated financial statements included at Item 18 of this
annual report.



Depending on the expected long
term rate of return on plan assets used, the pension and post-retirement benefit expense could vary within a range of outcomes and have a material effect on reported earnings. A sensitivity analysis to expected long term rate of return is performed
in Note D.19.1. Provisions for pensions and other benefits to our consolidated financial statements included at Item 18 of this annual report.



Deferred taxes. As discussed in Note B.22. Income tax expense to our consolidated financial statements included
at Item 18 of this annual report, we account for deferred taxes using the liability method, whereby deferred income taxes are recognized on tax loss carry-forwards, and on the difference between the tax base and carrying amount of assets and
liabilities. We calculate our deferred tax assets



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| | and liabilities using enacted tax rates applicable for the years during which we estimate that the temporary differences are expected to reverse. We do not recognize deferred tax assets when it
is more likely than not that the deferred tax assets will not be realized. The estimates of recognized deferred tax assets are based on our assumptions regarding future profits and the timing of reversal of temporary differences. These assumptions
are regularly reviewed; however, final deferred income tax could differ from those estimates.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Provisions for risks. Sanofi-aventis and its subsidiaries and affiliates may be involved in litigation, arbitration or other legal proceedings.
These proceedings typically are related to product liability claims, intellectual property rights, compliance and trade practices, commercial claims, employment and wrongful discharge claims, tax assessment claims, waste disposal and pollution
claims, and claims under warranties or indemnification arrangements relating to business divestitures. As discussed in Note B.12. Provisions for risks at Item 18 of this annual report, we record a provision where we have a present
obligation, whether legal or constructive, as a result of a past event; when it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation; and when a reliable estimate can be made of the amount of
the outflow of resources. For additional details regarding the financial impact of provisions for risks see Notes D.19.3. Other provisions and D.22. Legal and Arbitral Proceedings to our consolidated financial statements
included at Item 18 of this annual report.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Provisions are estimated on the basis of events and circumstances related to present obligations at the balance sheet date, of past experience, and to the best of managements knowledge at the date
of preparation of the financial statements. The assessment of provisions can involve a series of complex judgments about future events and can rely heavily on estimates and assumptions. Given the inherent uncertainties related to these estimates and
assumptions, the actual outflows resulting from the realization of those risks could differ from our estimates.



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Item 6. Directors, Senior Management and Employees



A. Directors and Senior Management



On December 16, 2009, the Board of
Directors declared its intent to appoint Serge Weinberg as non- executive Chairman of the Board of Directors to replace Jean-François Dehecq, who was approaching the age limit set in the Companys articles of association. This
appointment took place on May 17, 2010, and was consistent with the decision of the Board of Directors to separate the office of Chairman from the office of Chief Executive Officer, effective from January 1, 2007.



The Chairman represents the Board of Directors. He
organizes and directs the work of the Board, and is accountable for this to the Shareholders General Meeting. He is also responsible for ensuring that the corporate decision-making bodies chaired by him (Board of Directors and
Shareholders General Meeting) operate properly.



Because the offices of Chairman and Chief Executive Officer are separated, the Chairman may remain in office until the Ordinary General Meeting called to approve the financial statements and held during
the calendar year in which he reaches the age of 70.



The Chief Executive Officeris responsible for the management of the Company, and represents it in dealings with third parties. He has the broadest powers to act in the name of the Company.



The Chief Executive Officer must be no more than
65 years old.



Limits placed by the Board on
the powers of the Chief Executive Officer



The Board of Directors Meeting of July 28, 2009 set limits on the powers of the Chief Executive Officer. The prior authorization of
the Board of Directors is required to commit sanofi-aventis to investments, acquisitions and divestments in the following cases:



| |  |  | a 500 million cap for each undertaking pertaining to a previously approved strategy; and
| | - |  | -----------------------------------------------------------------------------------------



| |  |  | a 150 million cap for each undertaking not pertaining to a previously approved strategy.
| | - |  | -----------------------------------------------------------------------------------------



When the consideration payable to the contracting parties for
such undertakings includes potential installment payments subject to the achievement of future results or objectives, such as the registration of one or more products, the caps are calculated by adding the various payments due from signature of the
contract until (and including) filing of the first application for marketing authorization in the United States or in Europe.



Board of Directors



Sanofi-aventis is administered by a Board of Directors with fourteen members.



Since May 14, 2008, the terms of office of these directors have been staggered, such that in each year
from 2010 to 2012 approximately one-third of the Board will be required to seek re-election each year.



During its meeting on February 24, 2011, the Board discussed the issue of director independence. Out of the fourteen directors, half
were regarded as independent: Uwe Bicker, Lord Douro, Jean-René Fourtou, Claudie Haigneré, Carole Piwnica, Klaus Pohle and Gérard Van Kemmel.



A director is regarded as independent if he or she has no
relationship of any kind with the Company, the Group or its management that is liable to impair his or her judgment. It is the responsibility of the Board, acting upon the recommendation of the Appointments and Governance Committee, to assess the
independence of its members.



No more than
one-third of the serving members of our Board of Directors may be over 70 years of age.



118



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Subject to the authority expressly reserved by law to Shareholders General Meetings
and within the scope of the corporate objects, the Board of Directors deals with and takes decisions upon all issues relating to the proper management of the Company and other matters concerning the Board.



Composition of the Board of Directors as of December 31, 2010



|                                     |  |                                                      |  |                                            
|------------------------------------ |  | ---------------------------------------------------- |  | -------------------------------------------
|Serge Weinberg
Chairman of the Board |  | Date of birth
Nationality First elected
Term expires |  | February 10, 1951
French December 2009
2011

|                                                                                                         |  |  |  | 
|-------------------------------------------------------------------------------------------------------- |  |  |  | 
|                                                                                                        
|1,500 shares                                                                                            
|                                                                                                        
|Other current directorships and appointments                                                            
|  Chairman of the Appointments and Governance Committee and of the Strategy Committee of
sanofi-aventis
|  Chairman of Weinberg Capital Partners, Financière Piasa, Piasa Holding and Corum
(Switzerland)       
|  Director of Piasa, Team Partners Group and VL Holding                                                
|  Manager of Alret and Maremma                                                                         
|  Member of the Supervisory Committee of Amplitude Group and Financière
BFSA                           
|  Vice Chairman and Director of Financière Poinsétia and Financière
Sasa                               
|  Member of the Supervisory Board of Schneider Electric                                                
|  Weinberg Capital Partners representative on the Board of Alliance Industrie and Sasa
Industrie      
|                                                                                                        
|Education and business
experience                                                                       
|  Graduate in law                                                                                      
|  Degree from the Institut dEtudes Politiques                                                         
|  Studies at the ENA (Ecole Nationale dAdministration)                                                

|          |  |                                                                                                                 
|--------- |  | ----------------------------------------------------------------------------------------------------------------
|          | 
|1976-1982 |  | Sous-Préfet and then Chief of Staff of the French Budget Minister (1981)                                        
|1982-1987 |  | Deputy General Manager of FR3 (the French Television Channel) and then Chief Executive Officer of Havas Tourisme
|1987-1990 |  | Chief Executive Officer of Pallas Finance                                                                       
|1990-2005 |  | Various positions at PPR group including Chairman of the Management Board for 10 years                          



|                                                                                                    |  | 
|--------------------------------------------------------------------------------------------------- |  | 
|                                                                                                   
|Past directorships held since 2006                                                                 
|  Chairman of the Board of Accor (2006-2009)                                                      
|  Director of Alliance Industrie (2006-2008), of Road Holding (2007-2008) and of Rasec
(2006-2010)
|  Member of the Board of Pharma Omnium International (2006-2010)                                  
|  Member of the Supervisory Board of Rothschild & Cie (until 2010)                                
|  Member of the Supervisory Board of Gucci Group (Netherlands, until 2010)                        
|  Director of Fnac (until 2010) and of Rothschild Concordia (until 2010)                          



|                                                        |  |                                                                    |  |                                                      
|------------------------------------------------------- |  | ------------------------------------------------------------------ |  | -----------------------------------------------------
|                                                        |  |                                                                   
|Christopher Viehbacher
Chief Executive Officer
Director |  | Date of birth
Nationalities First elected
Term as director expires |  | March 26, 1960
German and Canadian December
2008 2014

|                                                                                                                    |  |  |  | 
|------------------------------------------------------------------------------------------------------------------- |  |  |  | 
|                                                                                                                   
|10,000 shares                                                                                                      
|                                                                                                                   
|Other current directorships and appointments                                                                       
|  Chairman of the Executive Committee and the Management Committee of
sanofi-aventis                              
|  Member of the Strategy Committee of sanofi-aventis                                                              
|  Chairman of the Board of Directors of PhRMA (United States)                                                     
|  Vice Chairman of EFPIA (Belgium)                                                                                
|  Member of the Board of Directors of Research America (United States) and Burroughs Wellcome Fund
(United States)
|  Member of the Board of Visitors of Fuqua School of Business, Duke University (United
States)                    
|  Member of the Board of Business Roundtable (United
States)                                                      



119



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##### Table of Contents

|                                                                                           |  |  |  | 
|------------------------------------------------------------------------------------------ |  |  |  | 
|                                                                                          
|Education and business experience                                                         
|  Graduate in Commerce of Queens University (Ontario-Canada); certified public
accountant

|                                                    |  |  |  | 
|--------------------------------------------------- |  |  |  | 
|  Began his career at PricewaterhouseCoopers Audit

|          |  |                                                                                                    
|--------- |  | ---------------------------------------------------------------------------------------------------
|          | 
|1998-2008 |  | Various positions at the GSK group, including President Pharmaceutical Operations for North America



Past directorships held since 2006



| |  | Director of GlaxoSmithkline plc until November 2008 (United Kingdom)
| | - | --------------------------------------------------------------------

| |  | Member of the Board of Triangle United Way (United States, 2003-2008), of Cardinal Club (United States, 2004-2008) and GlaxoSmithKline NC Foundation (United States,
2003-2008)
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Vice Chairman of Portfolio Management Board of GSK plc (United Kingdom, 2007-2008)
| | - | ----------------------------------------------------------------------------------

| |  | Member of Advisory Council of Center for Healthcare Transformation (United States, until 2010)
| | - | ----------------------------------------------------------------------------------------------



|                                |  |                                                      |  |                                   
|------------------------------- |  | ---------------------------------------------------- |  | ----------------------------------
|Uwe Bicker Independent Director |  | Date of birth
Nationality First elected
Term expires |  | June 14, 1945
German May 2008
2012

600 shares



Other current directorships and appointments



| |  | Member of the Strategy Committee of sanofi-aventis
| | - | --------------------------------------------------

| |  | Chairman of the Supervisory Board of Siemens Healthcare Diagnostics Holding GmbH (Germany)
| | - | ------------------------------------------------------------------------------------------

| |  | Vice Chairman of the Supervisory Board of Epigenomics AG (Germany)
| | - | ------------------------------------------------------------------

| |  | Member of the Supervisory Board of Future Capital AG (Germany) and Definiens AG (Germany)
| | - | -----------------------------------------------------------------------------------------

| |  | Director of Fondation Aventis (Foundation, Germany)
| | - | ---------------------------------------------------

| |  | Chairman of the Board of Marburg University (Germany)
| | - | -----------------------------------------------------

| |  | Member of the Board of Trustees of Bertelsmann Stiftung (Bertelsmann Foundation, Germany)
| | - | -----------------------------------------------------------------------------------------

| |  | Member of the Advisory Board of Morgan Stanley (Germany)
| | - | --------------------------------------------------------



Education and business experience



| |  | Doctorate in chemistry and in medicine
| | - | --------------------------------------

| |  | Honorary Doctorate, Klausenburg University
| | - | ------------------------------------------

| |  | Honorary Senator, Heidelberg University
| | - | ---------------------------------------



|                               |  |                                                                                                                                                 
|------------------------------ |  | ------------------------------------------------------------------------------------------------------------------------------------------------
|1975-1994
1994-2004
Since 1983 |  | Various positions at Boehringer Mannheim GmbH (later Roche AG) Various positions at Hoechst group Professor at the Medical Faculty of
Heidelberg



Past directorships held since 2006



N/A



|                 |  |                    |  |               
|---------------- |  | ------------------ |  | --------------
|Robert Castaigne |  | Date of birth      |  | April 27, 1946
|Director         |  | Nationality        |  | French        
|                 |  | First elected      |  | February 2000 
|                 |  | Last reappointment |  | May 2008      
|                 |  | Term expires       |  | 2014          

500 shares



Other current directorships and appointments



| |  | Member of the Audit Committee of sanofi-aventis
| | - | -----------------------------------------------

| |  | Director of Vinci, Société Générale and Compagnie Nationale à Portefeuille (Belgium)
| | - | ------------------------------------------------------------------------------------

| |  | Member of the Audit Committee of Compagnie Nationale à Portefeuille (Belgium)
| | - | -----------------------------------------------------------------------------

| |  | Member of the Audit, Internal control and Risk Committee of Société Générale
| | - | ----------------------------------------------------------------------------

| |  | Member of the Financial Statements Committee of Vinci
| | - | -----------------------------------------------------



120



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Education and business experience



| |  | Degree from the Ecole Centrale de Lille and the Ecole Nationale Supérieure du Pétrole et des Moteurs
| | - | ----------------------------------------------------------------------------------------------------

| |  | Doctorate in economic sciences
| | - | ------------------------------



|          |  |                                                                                                                                     
|--------- |  | ------------------------------------------------------------------------------------------------------------------------------------
|          | 
|1972-2008 |  | Various positions at the Total Group, including Chief Financial Officer and member of the Executive Committee (June 1994  May 2008)



|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Past directorships held since 2006 
 Chairman and Chief Executive Officer of Total Chimie (1996-2008) and of Total Nucléaire
(1992-2008) Director of Elf Aquitaine (2000-2008), of Hutchinson (1995-2008), of Total Gestion Filiales (1994-2008),of Omnium Insurance & Reinsurance Company Ltd
(Bermuda, 1996-2008), of Petrofina (Belgium, 1999-2008), of Total Upstream UK Ltd (United-Kingdom, 2005-2008), Total Gabon (2003-2008), of Arkema(2000-2006) and of Alphega (Bermuda, 2000-2006)



|                           |  |                                                                         |  |                                                     
|-------------------------- |  | ----------------------------------------------------------------------- |  | ----------------------------------------------------
|                           |  |                                                                        
|Thierry Desmarest
Director |  | Date of birth
Nationality First elected
Last reappointment Term
expires |  | December 18, 1945
French
February 2000 May
2008 2011

500 shares



Other current directorships and appointments



| |  | Member of the Compensation Committee, the Appointments and Governance Committee and the Strategy Committee of sanofi-aventis
| | - | ----------------------------------------------------------------------------------------------------------------------------

| |  | Director and Honorary President of Total SA
| | - | -------------------------------------------

| |  | Director of LAir Liquide, Renault SA, Renault SAS
| | - | --------------------------------------------------

| |  | Chairman of the Nominating and Governance Committee of Total S.A.
| | - | -----------------------------------------------------------------

| |  | Member of the Compensation Committee of Total S.A.
| | - | --------------------------------------------------

| |  | Chairman of Fondation Total and lEcole Polytechnique (Foundations)
| | - | -------------------------------------------------------------------

| |  | Member of the Appointments and Governance Committee and the Compensation Committee of LAir Liquide
| | - | ---------------------------------------------------------------------------------------------------

| |  | Chairman of the International Strategy Committee, member of the Remuneration Committee and member of the Industrial Strategy Committee of Renault SA
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Director, member of the Appointments and Governance Committee, member of the Human Resources and Compensation Committee of Bombardier Inc. (Canada)
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Member of the Board of Directors of lEcole Polytechnique
| | - | ---------------------------------------------------------

| |  | Director of Musée du Louvre
| | - | ---------------------------



Education and business experience



| |  | Degree from LEcole Polytechnique and LEcole Nationale Supérieure des Mines de Paris
| | - | -------------------------------------------------------------------------------------

|           |  |                                                                                                                                                                                                                                                                                                       
|---------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|           | 
|Since 1981 |  | Various positions at the Total group including Chairman and Chief Executive Officer (1995-2007). Chairman of the Board of Directors (February 2007-May 2010); since May 21,
2010. Honorary President of Total SA and Member of the Board of Directors as well as the Chairman of the Total foundation.



Past directorships held since 2006



| |  | Chairman and Chief Executive Officer of Elf Aquitaine (2000-2007)
| | - | -----------------------------------------------------------------

| |  | Chairman and Chief Executive Officer of Total S.A. (1995-2007)
| | - | --------------------------------------------------------------

| |  | Chairman of the Board of Directors of Total (2007-2010)
| | - | -------------------------------------------------------

| |  | Member of the Supervisory Board of Areva (2001-2010)
| | - | ----------------------------------------------------



121



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|                                |  |                                                                         |  |                                               
|------------------------------- |  | ----------------------------------------------------------------------- |  | ----------------------------------------------
|Lord Douro
Independent Director |  | Date of birth
Nationality First elected
Last reappointment Term expires |  | August 19, 1945
British May 2002
May 2006
2014

1,000 shares



|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Other current directorships and appointments
  Member of the
Appointments and Governance Committee and of the Strategy Committee of sanofi-aventis
 Chairman of Richemont Holdings UK Ltd and Kings College London (United Kingdom)
 Director of Pernod Ricard, Compagnie Financière Richemont AG (Switzerland), Abengoa Bioenergy
(Spain) and GAM Worldwide (United Kingdom)  Advisor of Crédit Agricole (United
Kingdom)  Member of the Appointments Committee and of the Compensation Committee of
Compagnie Financière Richemont AG (Switzerland)  Director of RIT Capital (United
Kingdom)  Chairman of the Remuneration Committee and the Conflicts Committee of RIT Capital
(United Kingdom)  Member of the Nominations Committee of RIT Capital (United
Kingdom)
|Education and
business experience 
 Degree from Oxford University                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              



|          |  |                                                  
|--------- |  | -------------------------------------------------
|1979-1989 |  | Member of the European Parliament                
|1995-2000 |  | Chairman of Sun Life & Provincial Holdings Plc   
|2003-2007 |  | Commissioner of English Heritage (United Kingdom)



|                                                                                                                          
|--------------------------------------------------------------------------------------------------------------------------
|Past directorships held since 2006 
 Member of the Compensation Committee and the Appointments Committee of Pernod
Ricard



|                                       |  |                                                                         |  |                                               
|-------------------------------------- |  | ----------------------------------------------------------------------- |  | ----------------------------------------------
|Jean-René Fourtou
Independent Director |  | Date of birth
Nationality First elected
Last reappointment Term expires |  | June 20, 1939
French August 2004
May 2008
2012

|                                                                                                                                                                                                                                                                                                                                                                                       
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4,457 shares
 Other current directorships and
appointments 
 Member of the Compensation Committee, the Appointments and Governance Committee and the Strategy
Committee of sanofi-aventis  Chairman of the Supervisory Board of Vivendi and of Groupe
Canal +  Member of the Supervisory Board of Maroc Telecom (Morocco)
 Director of Axa Millésimes SAS, and Nestlé (Switzerland)



|                                                                        
|------------------------------------------------------------------------
|Education and business experience
  Degree from the
Ecole Polytechnique



|                    |  |                                                                                                                                                                                    
|------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1963-1986           |  | Various positions at the Bossard group, including Chairman and Chief Executive Officer (1977-1986)                                                                                 
|1986-1999
1999-2004 |  | Chairman and Chief Executive Officer of Rhône-Poulenc Vice Chairman of the Management Board, Vice Chairman of the Supervisory Board and member of the Strategy Committee of Aventis
|2002-2005           |  | Chairman and Chief Executive Officer of Vivendi                                                                                                                                    



122



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|                                                                                                                                                                                                                
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Past directorships held since 2006
   Vice President
then member of the Supervisory Board of AXA (1990-2009)   Director of Cap Gemini
(2005-2009)   Director of NBC Universal Inc. (United States,
2004-2010)



|                                      |  |                                                      |  |                                  
|------------------------------------- |  | ---------------------------------------------------- |  | ---------------------------------
|Claudie Haigneré
Independent Director |  | Date of birth
Nationality First elected
Term expires |  | May 13, 1957
French May 2008
2012

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|500 shares
 Other current directorships and
appointments 
  Member of the Compensation Committee and the Appointments and Governance Committee of
sanofi-aventis   Chairman of the Board of Directors of La Géode
  Chairman of Universcience (Cité des Sciences and Palais de la
Découverte)   Vice President of the IAA (International Academy of
Astronautics)   Director of France Telecom, of Aéro-Club de France, of
Fondation de France, of Fondation CGénial and of Fondation dEntreprise LOréal (Foundations)   Member of Académie des Technologies, Académie des Sports and Académie Nationale de lAir et de lEspace
  Member of the Strategy Committee of France Telecom



Education and business experience



| |  | Rheumatologist, doctorate in sciences majoring in neurosciences
| | - | ---------------------------------------------------------------

| |  | Selected in 1985 by CNES (French National Space Center) as a candidate astronaut
| | - | --------------------------------------------------------------------------------



|          |  |                                                                                              
|--------- |  | ---------------------------------------------------------------------------------------------
|1984-1992 |  | Rheumatologist, Cochin Hospital (Paris)                                                      
|1996      |  | Scientific space mission to the MIR space station (Cassiopée Franco-Russian mission)         
|2001      |  | Technical and scientific space mission to the International Space Station (Andromède mission)
|2002-2004 |  | Deputy Minister for Research and New Technologies in French government                       
|2004-2005 |  | Deputy Minister for European Affairs                                                         



Past directorships held since 2006



| |  | Chairman of the Cité des Sciences and Palais de la Découverte until 2009
| | - | ------------------------------------------------------------------------



|                     |  |                                                                         |  |                                               
|-------------------- |  | ----------------------------------------------------------------------- |  | ----------------------------------------------
|Igor Landau
Director |  | Date of birth
Nationality First elected
Last reappointment Term expires |  | July 13, 1944
French August 2004
May 2008
2011

12,116 shares



Other current directorships and appointments



| |  | Chairman of the Supervisory Board of Adidas-Salomon (Germany)
| | - | -------------------------------------------------------------

| |  | Director of HSBC France and INSEAD
| | - | ----------------------------------

| |  | Member of the Supervisory Board of Allianz AG (Germany)
| | - | -------------------------------------------------------



123



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Education and business experience



| |  | Degree from the Ecole des Hautes Etudes Commerciales(HEC) and from INSEAD (Master of Business Administration)
| | - | -------------------------------------------------------------------------------------------------------------



|          |  |                                                                                                                                                                          
|--------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1968-1970 |  | Chief Executive Officer of the German subsidiary of La Compagnie du Roneo (Frankfurt)                                                                                    
|1971-1975 |  | Management consultant at McKinsey (Paris)                                                                                                                                
|1975-2004 |  | Various positions at the Rhône-Poulenc group, including member of the Management Board of Aventis (1999-2002) and Chairman of the Management Board of Aventis
(2002-2004)
|2001-2005 |  | Director of Essilor                                                                                                                                                      
|2002-2005 |  | Director of Thomson (now called Technicolor)                                                                                                                             



Past directorships held since 2006



| |  | Member of the Supervisory Board of Dresdner Bank (Germany, 2003-2006)
| | - | ---------------------------------------------------------------------



|                           |  |                                                                         |  |                                                
|-------------------------- |  | ----------------------------------------------------------------------- |  | -----------------------------------------------
|                           |  |                                                                        
|Christian Mulliez
Director |  | Date of birth
Nationality First elected
Last reappointment Term expires |  | November 10, 1960French
June 2004 May 2010
2014

1,324 shares



Other current directorships and appointments



| |  | Vice President, General Manager Administration and Finance of LOréal
| | - | ---------------------------------------------------------------------

| |  | Chairman of the Board of Directors of Regefi
| | - | --------------------------------------------

| |  | Director of DG 17 Invest, LOréal USA Inc., The Body Shop International (United Kingdom) and Galderma Pharma (Switzerland)
| | - | --------------------------------------------------------------------------------------------------------------------------



Education and business experience



| |  | Degree from the Ecole Supérieure des Sciences Economiques et Commerciales (ESSEC)
| | - | ---------------------------------------------------------------------------------



|           |  |                                                                                                
|---------- |  | -----------------------------------------------------------------------------------------------
|1984-2002  |  | Various positions at Synthélabo and then at Sanofi-Synthélabo, including Vice President Finance
|Since 2003 |  | Executive Vice President Administration and Finance LOréal                                    



Past directorships held since 2006



N/A



|                            |  |                                                                         |  |                                              
|--------------------------- |  | ----------------------------------------------------------------------- |  | ---------------------------------------------
|Lindsay Owen-Jones
Director |  | Date of birth
Nationality First elected
Last reappointment Term expires |  | March 17, 1946
British May 1999
May 2008
2012

15,000 shares



Other current directorships and appointments



| |  | Member of the Compensation Committee, of the Appointments and Governance Committee and of the Strategy Committee of sanofi-aventis
| | - | ----------------------------------------------------------------------------------------------------------------------------------

| |  | Chairman of the Board of Directors of LOréal
| | - | ---------------------------------------------

| |  | Chairman of the Strategy and Implementation Committee of LOréal
| | - | ----------------------------------------------------------------

| |  | Chairman of the Board of Directors of Fondation dEntreprise LOréal (Foundation)
| | - | ---------------------------------------------------------------------------------

| |  | Chairman of Alba Plus, LOréal UK Ltd (United Kingdom) and LOréal USA Inc. (United States)
| | - | -------------------------------------------------------------------------------------------

| |  | Director of Ferrari S.p.A. (Italy)
| | - | ----------------------------------



124



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Education and business experience



| |  | Bachelor of Arts (Hons) from Oxford University and degree from INSEAD
| | - | ---------------------------------------------------------------------



|           |  |                                                                                                                                                               
|---------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------
|Since 1969 |  | Various positions at the LOréal group, including Chairman and Chief Executive Officer (1988-2006) and Chairman of the Board of Directors since April 25,
2006
|1989-2005  |  | Director of BNP Paribas                                                                                                                                       



Past directorships held since 2006



| |  | Chief Executive of LOréal (1988-2006)
| | - | --------------------------------------

| |  | Vice-President and member of the Supervisory Board of LAir Liquide (2001-2006)
| | - | -------------------------------------------------------------------------------

| |  | Vice-Chairman of the Board of Directors of LAir Liquide (2006-2009)
| | - | --------------------------------------------------------------------

| |  | Director of Galderma Pharma until 2006
| | - | --------------------------------------



|                                       |  |                                                                    |  |                                             
|-------------------------------------- |  | ------------------------------------------------------------------ |  | --------------------------------------------
|Carole Piwnica(1) Independent Director |  | Date of birth
Nationality First elected
(Co-optation) Term expires |  | February 12, 1958
Belgian December 2010
2012



Other current directorships and appointments



| |  |  | Chief executive officer of Naxos UK Ltd (United Kingdom)
| | - |  | --------------------------------------------------------

| |  |  | Director and Chairman of the Committee of Governance, Compensation and Appointment of Eutelsat Communications
| | - |  | -------------------------------------------------------------------------------------------------------------

| |  |  | Director of Louis Delhaize (Belgium) and Amyris Inc. (United States)
| | - |  | --------------------------------------------------------------------

| |  |  | Director, Chairman of the Corporate Responsibility Committee and member of the Compensation Committee of Aviva Plc (United Kingdom)
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------



Education
and business experience



| |  |  | Degree in law, Université Libre de Bruxelles
| | - |  | --------------------------------------------

| |  |  | Masters in law, New York University
| | - |  | -----------------------------------

| |  |  | Admitted to Paris and New York Bars
| | - |  | -----------------------------------



|          |  |                                                                                                           
|--------- |  | ----------------------------------------------------------------------------------------------------------
|1985-1991 |  | Attorney at Proskauer, Rose (NY) and Shearman & Sterling (Paris) with practice in mergers and acquisitions
|1991-1994 |  | General Counsel of Gardini & Associés                                                                     
|1994-2000 |  | Chief Executive Officer of Amylum France, then Chairman of Amylum Group                                   



Past directorships held since 2006



| |  | Director of Dairy Crest Plc (United Kingdom, 2007-2010)
| | - | -------------------------------------------------------

| |  | Vice-Chairman and Director of Tate & Lyle Plc (United Kingdom, 1996-2006) and Vice-Chairman for Governmental Affairs (2000-2006)
| | - | --------------------------------------------------------------------------------------------------------------------------------

| |  | Director of the CIAA (Confederation of the Food and Drink Industries of the European Union) (1996-2006)
| | - | -------------------------------------------------------------------------------------------------------

| |  | Director of Toepfel GmbH (Germany, 1996-2010) and of Spadel (Belgium, 1998-2004)
| | - | --------------------------------------------------------------------------------

| |  | Member of the Ethical Committee of Monsanto (United States, 2006-2009)
| | - | ----------------------------------------------------------------------



|                                 |  |                                                                         |  |                                                  
|-------------------------------- |  | ----------------------------------------------------------------------- |  | -------------------------------------------------
|Klaus Pohle
Independent Director |  | Date of birth
Nationality First elected
Last reappointment Term expires |  | November 3, 1937
German August 2004
May 2008
2012

|                                                                                                                                                                                                                                                                                                                                                                                                                                      
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                      
|2,500 shares
 Other current directorships and appointments
   Chairman of the
Audit Committee of sanofi-aventis   Director of Labelux Group GmbH
(Switzerland)   Director and Chairman of the Audit Committee of Coty Inc., New York,
(United States)   Professor of business administration
at Berlin Institute of Technology (Germany) (1)   In accordance with the Articles of
Association, Carole Piwnica will buy 500 shares.



125



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|                                                                                                                                                                                                                                                                         
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Education and business experience 
 Doctorate in law from Frankfurt University (Germany)
 Doctorate in economics from Berlin University (Germany)
 Masters in law from Harvard University
 Professor of Business Administration at the Berlin Institute of
Technology



|          |  |                                                                          
|--------- |  | -------------------------------------------------------------------------
|1966-1980 |  | Various positions at the BASF group                                      
|1981-2003 |  | Deputy Chief Executive Officer and Chief Financial Officer of Schering AG
|2003-2005 |  | Chairman of the German Accounting Standards Board                        



|                                                                                                                                                                                                                                                                      
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Past directorships held since 2006
  President of the
Supervisory Board (in 2008) and Vice-President of the Supervisory Board of Hypo Real Estate Holding AG, Munich (Germany)  Member of the Supervisory Board of DWs investment GmbH (Germany, prior to 2005-2009)



|                                       |  |                                                                         |  |                                             
|-------------------------------------- |  | ----------------------------------------------------------------------- |  | --------------------------------------------
|Gérard Van Kemmel
Independent Director |  | Date of birth
Nationality First elected
Last reappointment Term expires |  | August 8, 1939
French May 2003
May 2007
2011

|                                                                                                                                                                                                                                                                        
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|500 shares
 Other current directorships and appointments
  Chairman of the
Compensation Committee, Member of the Audit Committee and the Appointments and Governance Committee of sanofi-aventis  Director of Europacorp  Member of
the Audit Committee of Europacorp



|                                                                                                                                              
|----------------------------------------------------------------------------------------------------------------------------------------------
|Education and business experience 
 Graduate of the Ecole des Hautes Etudes Commerciales (HEC)
 MBA degree from the Stanford Business School



|          |  |                                                                                                                                                                          
|--------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1966-1995 |  | Various positions including President of Arthur Andersen and Andersen Consulting in France (1976-1995) and Chairman of the Board of Arthur Andersen Worldwide
(1989-1994)
|1996-1997 |  | Advisor, French Finance Minister                                                                                                                                         
|1997-2006 |  | Various positions at Cambridge Technology Partners (Chief Operating Officer) and at Novell (Chairman EMEA)                                                               



|                                                                                                                                                                                                            
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Past directorships held since 2006
  Europe Chairman of
Novell (United States, 2004-2006)  Director of Groupe Eurotunnel
 Director of Eurotunnel NRS Holders Company Limited (United Kingdom, until
2010)



During 2010 the Board of
Directors met nine times, with an overall attendance rate among Board members of more than 90.17%. This attendance rate is particularly high, given that several meetings were called at short notice, largely as a result of the project to acquire
Genzyme. Notwithstanding, participation in Board meetings by conference call remained limited to extraordinary meetings, and applied to only a limited number of directors.



Several changes in the composition of the Board of Directors
occurred in 2010. Jean-Marc Bruel did not seek reappointment upon expiration of his term on May 17, 2010. On the same day, following the Shareholders General Meeting Jean-François Dehecq resigned as a Director. On July 1,
2010, Patrick de La Chevardière



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announced his resignation as a Director, and on December 15, 2010, Carole Piwnica was co-opted by the Board of Directors to serve for his remaining term of office, subject to shareholder
ratification at the upcoming General Meeting scheduled for May 6, 2011.



Executive Committee



The Executive Committee is chaired by the Chief Executive Officer.



The Committee meets twice a month, and has the following permanent members:



| |  |  | Christopher Viehbacher, Chief Executive Officer;
| | - |  | ------------------------------------------------



| |  |  | Olivier Charmeil,Senior Vice President Vaccines;
| | - |  | ------------------------------------------------



| |  |  | Jérôme Contamine, Executive Vice President Chief Financial Officer;
| | - |  | -------------------------------------------------------------------



| |  |  | Karen Linehan, Senior Vice President Legal Affairs and General Counsel;
| | - |  | -----------------------------------------------------------------------



| |  |  | Philippe Luscan, Senior Vice President Industrial Affairs;
| | - |  | ----------------------------------------------------------



| |  |  | Roberto Pucci, Senior Vice President Human Resources;
| | - |  | -----------------------------------------------------



| |  |  | Hanspeter Spek, President Global Operations; and
| | - |  | ------------------------------------------------



| |  |  | Elias Zerhouni, President, Global Research and Development
| | - |  | ----------------------------------------------------------



The name, business address, present principal occupation or employment and material occupations, positions,
offices or employment for the past five years of each of the executive officers of Sanofi-Aventis are set forth below. The business address and phone number of each such executive officer is c/o Sanofi-Aventis, 174, avenue de France, 75013 Paris,
France, +33 1 53 77 40 00. Unless otherwise indicated, each executive officer is a citizen of France.



Christopher Viehbacher

Chief Executive Officer

Chairman of the Executive Committee

Date of birth : March 26, 1960



Christopher Viehbacher was appointed as Chief Executive Officer in 2008, and is a member of the Strategy Committee.



For additional information regarding his professional
education and business experience see Composition of the Board of Directors as of December 31, 2010 in A. Directors and Senior Management on this Item 6.



Christopher Viehbacher is a citizen of Germany and Canada.



Olivier Charmeil

Senior Vice President Vaccinessince January 1, 2011

Date of birth :February 19, 1963



Olivier Charmeil is a graduate of HEC (Ecole des Hautes Etudes Commerciales) and of the Institut dEtudes Politiques in Paris. From 1989 to 1994, he worked in the Mergers &
Acquisitions department of Banque de lUnion européenne. He joined Sanofi Pharma in 1994 as head of Business Development. Subsequently, he held various posts within the Group, including Chief Financial Officer (Asia) for
Sanofi-Synthélabo in 1999 and Attaché to the Chairman, Jean-François Dehecq, in 2000, before being appointed as Vice President, Development within the Sanofi-Synthélabo International Operations
Directorate, where he was responsible for China and support functions. In 2003, Olivier Charmeil was appointed Chairman and Chief Executive Officer of Sanofi-Synthélabo France, before taking the post of Senior Vice President, Business
Management and Support within the Pharmaceutical Operations Directorate. In this role, he piloted the operational integration of Sanofi-Synthélabo and Aventis. He was appointed Vice President Pharma Operations Asia Pacific in February 2006
and subsequently also had responsibility for Operations Japan and since February 2009 Asia/Pacific & Japan Vaccines. Since January 1, 2011, Olivier Charmeil has been Senior Vice President Vaccines and a member of the Executive
Committee.



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Jérôme Contamine

Executive Vice President Chief Financial Officer

Date of birth :November 23, 1957



Jérôme Contamine is a Graduate of École Polytechnique(X), and ENSAE, the national statistics and economics engineering school, affiliated with the Ministry of Finance
(1982). He also graduated from the ENA(Ecole Nationale dAdministration). After 4 years at the Cour des Comptes, as a Senior State General Auditor, he joined Elf Aquitaine in 1988, as advisor to the Chief
Financial Officer, and became Group Finance Director & Treasurer in 1991. He became the General Manager of Elf Petroleum Norway in 1995, after being named Deputy Vice President of Elf Upstream Division for Europe and the U.S. In 1999, he
was appointed as a member of the taskforce for integration with Total, in charge of the reorganization of the merged entity, TotalFinaElf, and in 2000 became Vice President Europe and Central Asia, Upstream Division of Total. The same year, he
joined Veolia Environnement as CFO and Deputy General Manager. In 2003, he was appointed Vice-President Senior Executive, Deputy Chief Executive Officer, Financial Director of Veolia Environnement. Jérôme Contamine was appointed
Executive Vice President, Chief Financial Officer (CFO) of sanofi-aventis in March 2009.



Karen Linehan

Senior Vice President Legal Affairs and General
Counsel

Date of birth : January 21,1959



Karen Linehan graduated from Georgetown University with
Bachelor of Arts and Juris Doctorate degrees. Prior to practicing law, Ms. Linehan served on the congressional staff of the Speaker of the U.S. House of Representatives from September 1977 to August 1986. Until December 1990, she was an
Associate in a mid-size law firm in New York. In January 1991, she joined Sanofi as Assistant General Counsel of its U.S. subsidiary. In July 1996, Ms. Linehan moved to Paris to work on international matters within the Group and she has held a
number of positions within the Legal Department, most recently as Vice President  Deputy Head of Legal Operations. She was appointed to her current position in March 2007.



Karen Linehan is a citizen of the United States of America
and Ireland.



Philippe Luscan

Senior Vice President Industrial Affairs

Date of birth : April 3,1962



Philippe Luscan is a graduate of the École
Polytechnique and the École des Minesin Biotechnology in Paris. He began his career in 1987 as a Production Manager at Danone. In 1990, he joined the Group as Director of the Sanofi Chimie plant at Sisteron, France, and
subsequently served as Industrial Director of Sanofi in the United States, as Vice President Supply Chain and as Vice President Chemistry in September 2006. He was appointed to his present position effective September 2008.



Roberto Pucci

Senior Vice President Human Resources

Date of birth : December 19,1963



Roberto Pucci has a Law degree from the University of Lausanne, Switzerland. He started his career in 1985 at Coopers & Lybrand
in Geneva, Switzerland as an external auditor. He then joined Hewlett-Packard (HP) in 1987, where he held various positions in Human Resources in Switzerland and Italy including HR Manager for the European Headquarters and Human Resources Director
in Italy. In 1999, he became Director, Compensation & Benefits for Agilent Technologies, a spin off from HP, and was appointed Vice President Human Resources Europe in 2003. In 2005 he moved to the United States to join Case New Holland, a
subsidiary of the Fiat Group, as Senior Vice President, Human Resources, and was appointed, in 2007, Executive Vice President, Human Resources for the Fiat Group in Torino, Italy. He was appointed to his present position in October 2009.



Roberto Pucci is a citizen of Italy and
Switzerland.



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Hanspeter Spek

President Global Operations

Date of birth : November 5,1949



Hanspeter Spek graduated from business school in Germany. In 1974, he completed a management training program at Pfizer International, and
then joined Pfizer RFA as a junior product manager. He served in various positions at Pfizer RFA, including as manager of the marketing division. Mr. Spek joined Sanofi Pharma GmbH, a German subsidiary of Sanofi, in 1985 as Marketing Director,
and served in various positions in Germany and then at Sanofi in France, before being named Senior Vice President Europe following the merger with Synthélabo in 1999. He served as Executive Vice President, International Operations from
October 2000, until January 2003, when he was named in charge of worldwide operations of Sanofi-Synthélabo. He was appointed Executive Vice President, Pharmaceutical Operations in August 2004 and then President, Global Operations in November
2009.



Hanspeter Spek is a citizen of Germany.



Elias Zerhouni

President, Global Research and Developmentsince January 2011

Date of birth :April 12, 1951



After completing his initial training in Algeria,
Dr. Zerhouni continued his academic career at the Johns Hopkins University and Hospital (United States) where he is currently professor of Radiology and Biomedical engineering and senior adviser for Johns Hopkins Medicine. He served as Chair of
the Russell H. Morgan Department of Radiology and Radiological Sciences, Vice Dean for Research and Executive Vice Dean of the School of Medicine from 1996 to 2002 before his appointment as Director of the National Institutes of Health of the United
States of America from 2002 to 2008. Dr. Zerhouni was received as member of the US National Academy of Sciences Institute of Medicine in 2000. He was recently appointed as Chair of Innovation at the College de France and elected member of
the French Academy of Medicine in 2010. In February 2009, Sanofi-Aventis named Dr. Zerhouni Scientific Advisor to the Chief Executive Officer and to the Senior Vice-President Research & Development. Since January 1, 2011,
Dr. Zerhouni is President Global Research & Development and serves on the Executive Committee of Sanofi-Aventis.



Dr. Zerhouni is a citizen of the United States of America.



As of December 31, 2010, none of the members of the
Executive Committee had any principal business activities outside of sanofi-aventis.



The Executive Committee is assisted by a broadly based Management Committee representing the principal services of the Group. The Management Committee is made up of the members of the Executive
Committee and 13 additional senior managers. Of the 21 members of the Management Committee, 4 are women, representing approximately 19% of the total.



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B. Compensation



Compensation and pension arrangements for corporate officers



Christopher Viehbacher has held the office of Chief Executive Officer since December 1, 2008. The
compensation of the Chief Executive Officer is determined by the Board of Directors with reference to compensation paid to the chief executive officers of leading global pharmaceutical companies and leading companies in the CAC 40 stock market
index. The Chief Executive Officer receives fixed compensation, benefits in kind, and variable compensation. In addition, he may be granted stock options and performance shares. The overall compensation package is set by the Board of Directors on
the recommendation of the Compensation Committee. In accordance with the AFEP-MEDEF corporate governance code, stock options granted to the Chief Executive Officer are subject to performance conditions (for a more detailed description of the
performance conditions see below under  Christopher Viehbacher for the compensation payable, stock options granted and performance shares awarded to Christopher Viehbacher).



Jean-François Dehecq held the office of non-executive Chairman of the Board of Directors from
January 1, 2010 until May 17, 2010 when Serge Weinberg took office. The Chairman of the Board also chairs the Strategy Committee and the Appointments and Governance Committee. In accordance with the Internal Rules of the Board and in close
collaboration with the Senior Management, he represents the Company in high-level dealings with governmental bodies and with the Groups key partners, both nationally and internationally; he plays a role in defining major strategic choices,
especially as regards mergers, acquisitions and alliances. He maintains regular contact with the Chief Executive Officer, so that each is kept fully informed of the others actions.



Serge Weinberg received attendance fees for the period prior to his appointment as Chairman of the Board of
Directors on May 17, 2010, and since then has received fixed compensation and certain benefits in kind but no variable compensation, stock options, performance shares or attendance fees. Jean-François Dehecq received fixed compensation,
certain benefits in kind and variable compensation.



The overall compensation package of the Chairman is set by the Board of Directors on the recommendation of the Compensation Committee.



The Chairman of the Board and the Chief Executive
Officer do not receive attendance fees in connection with their role as directors or members of Board committees of sanofi-aventis. Likewise, the Chairman of the Board does not receive attendance fees in connection with his chairmanship of the
Appointments and Governance Committee or the Strategy Committee.



Serge Weinberg



Compensation awarded to Serge Weinberg



|                                                                        |  |      |         |  |      |  |       | 
|----------------------------------------------------------------------- |  | ---- | ------- |  | ---- |  | ----- | 
|(in euros)                                                              |  | 2010 |         |  | 2009 | 
|Compensation payable for the year (details provided in the table below) |  |      | 480,158 |  |      |  | 6,215 | 
|Value of stock subscription options awarded during the year             |  |      | N/A     |  |      |  | N/A   | 
|Value of performance shares awarded during the year                     |  |      | N/A     |  |      |  | N/A   | 
|Total                                                                   |  |      | 480,158 |  |      |  | 6,215 | 



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Compensation payable and paid to Serge Weinberg



|                         |  |         |         |  |      |  |         |         |  |  |       |  |  |  |     | 
|------------------------ |  | ------- | ------- |  | ---- |  | ------- | ------- |  |  | ----- |  |  |  | --- | 
|                         |  | 2010    |         |  | 2009 | 
|(in euros)               |  | Payable |         |  | Paid |  |         | Payable |  |  | Paid  | 
|Fixed compensation(1)    |  |         | 439,748 |  |      |  | 439,748 |         |  |  | 0     |  |  |  | 0   | 
|Variable compensation    |  |         | N/A     |  |      |  | N/A     |         |  |  | N/A   |  |  |  | N/A | 
|Exceptional compensation |  |         | N/A     |  |      |  | N/A     |         |  |  | N/A   |  |  |  | N/A | 
|Attendance fees          |  |         | 35,625  |  |      |  | 6,215   |         |  |  | 6,215 |  |  |  | 0   | 
|Benefits in kind         |  |         | 4,785   |  |      |  | 4,785   |         |  |  | 0     |  |  |  | 0   | 
|Total                    |  |         | 480,158 |  |      |  | 450,748 |         |  |  | 6,215 |  |  |  | 0   | 



The amounts reported are gross amounts before taxes.



|(1) | Fixed compensation payable in respect of a given year is paid during that year.
|--- | -------------------------------------------------------------------------------



On May 17,
2010, upon the recommendation of the Compensation Committee, the Board of Directors set the terms of the compensation of Serge Weinberg.



For 2010, his fixed compensation was set at an annual rate of 700,000. Serge Weinberg does not receive any variable compensation,
stock options, or performance shares. For 2010, the fixed compensation of Serge Weinberg as non-executive Chairman was paid on a pro rata basis.



Attendance fees relate to the period starting December 15, 2009 and ending May 17, 2010 prior to Serge Weinberg becoming
Chairman. Consequently, in line with the Companys compensation policy applicable to the Chairman and the Chief Executive Officer, Serge Weinberg no longer receives any attendance fees as a Director since his appointment as Chairman of the
Board.



The amount reported for benefits in kind
relates principally to a company car.



Serge
Weinberg does not benefit from the sanofi-aventis top-up pension plan which covers Christopher Viehbacher.



Christopher Viehbacher



Christopher Viehbacher took office as Chief Executive Officer on December 1, 2008.



Compensation, options and shares awarded to Christopher Viehbacher



|                                                                        |  |      |           |  |      |  |           | 
|----------------------------------------------------------------------- |  | ---- | --------- |  | ---- |  | --------- | 
|(in euros)                                                              |  | 2010 |           |  | 2009 | 
|Compensation payable for the year (details provided in the table below) |  |      | 3,605,729 |  |      |  | 3,669,973 | 
|Value of stock subscription options awarded during the year(1)          |  |      | 2,499,750 |  |      |  | 1,237,500 | 
|Value of performance shares awarded during the year(2)                  |  |      | 887       |  |      |  | 2,221,700 | 
|Total                                                                   |  |      | 6,106,366 |  |      |  | 7,129,173 | 



|(1) | Valued at date of grant using the Black & Scholes method.
|--- | ---------------------------------------------------------

|(2) | Valued at date of grant. The value is the difference between the quoted market
price of the share on the award date and the dividends to be paid over the next three years. Christopher Viehbacher waived the 2010 allocation.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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Compensation payable and paid to Christopher Viehbacher



|                            |  |         |           |  |      |  |           |         |  |  |           |  |  |  |           | 
|--------------------------- |  | ------- | --------- |  | ---- |  | --------- | ------- |  |  | --------- |  |  |  | --------- | 
|                            |  | 2010    |           |  | 2009 | 
|(in euros)                  |  | Payable |           |  | Paid |  |           | Payable |  |  | Paid      | 
|Fixed compensation(1)       |  |         | 1,200,000 |  |      |  | 1,200,000 |         |  |  | 1,200,000 |  |  |  | 1,200,000 | 
|Variable compensation(2)    |  |         | 2,400,000 |  |      |  | 2,400,000 |         |  |  | 2,400,000 |  |  |  | 0         | 
|Exceptional compensation(3) |  |         | 0         |  |      |  | 0         |         |  |  | 0         |  |  |  | 2,200,000 | 
|Attendance fees             |  |         | 0         |  |      |  | 0         |         |  |  | 0         |  |  |  | 0         | 
|Benefits in kind            |  |         | 5,729     |  |      |  | 5,729     |         |  |  | 69,973    |  |  |  | 69,973    | 
|Total                       |  |         | 3,605,729 |  |      |  | 3,605,729 |         |  |  | 3,669,973 |  |  |  | 3,469,973 | 



|The | amounts reported are gross amounts before taxes.
|--- | ------------------------------------------------



|(1) | Fixed compensation payable in respect of a given year is paid during that year.
|--- | -------------------------------------------------------------------------------

|(2) | Variable compensation in respect of a given year is determined and paid at the
start of the following year
|--- | ----------------------------------------------------------------------------------------------------------

|(3) | Exceptional compensation corresponds to a benefit payable upon his starting to
hold office.
|--- | -------------------------------------------------------------------------------------------



The
fixed compensation of Christopher Viehbacher for 2009 and 2010 was 1,200,000.



In 2009 and 2010, the variable compensation of Christopher Viehbacher could have represented between 0% and 200% of his fixed compensation and was based half on quantitative criteria and half on
qualitative criteria. In the event of exceptional performance, it could have exceeded 200% of the fixed compensation.



The quantitative criteria included trends in our net sales relative to the objectives set by us and by our competitors (factor 2), trends
in our current operating income (operating income before restructuring, impairment of property, plant and equipment and intangibles, gains/losses on disposals, and litigation) relative to the objectives set by us and by our competitors (factor 3),
and trends in our adjusted earnings per share excluding selected items (which was a non-GAAP financial measure used until the end of 2009) (factor 5).



These criteria were assessed by reference to the performances of the leading global pharmaceutical companies.



The qualitative criteria related to leadership and strategic
choices, adaptation of our structures to the industrys environment, reconfiguration of our research efforts, commitment in terms of organic and external growth, and the quality of investor communications.



Taking into account the above mentioned criteria, the
performance of the Company and the contribution of Christopher Viehbacher during 2010, the Board of Directors fixed his variable compensation for 2010 at 2,400,000, i.e., 200% of the fixed portion of his compensation. His 2010 variable
compensation is to be paid in 2011.



The amount
reported for benefits in kind relates to a company car.



Stock options awarded to Christopher Viehbacher in 2010



|                |  |                   |          |  |                      |  |                     |              |  |  |                                |  |  |                      |         |  |                |  |       |  |  |  |                      | 
|--------------- |  | ----------------- | -------- |  | -------------------- |  | ------------------- | ------------ |  |  | ------------------------------ |  |  | -------------------- | ------- |  | -------------- |  | ----- |  |  |  | -------------------- | 
|Origin          |  | Date ofBoardgrant |          |  | Nature of theoptions |  |                     | Value
(in ) |  |  | Numberof optionsawarded in2010 |  |  | Exerciseprice
(in ) |         |  | Exerciseperiod | 
|Sanofi -aventis |  |                   | 03/01/10 |  |                      |  | Subscriptionoptions |              |  |  | 2,499,750                      |  |  |                      | 275,000 |  |                |  | 54.12 |  |  |  | 03/03/201402/28/2020 | 



On March 1, 2010, the Board of Directors granted 275,000 stock subscription options to Christopher Viehbacher. All of his stock
options are subject to a performance condition. The performance condition must be fulfilled each financial year preceding the exercise period (2010, 2011, 2012 and 2013), and requires the ratio of business net income (which was a non-GAAP financial
measure used until the end of 2009) to net sales to be at



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least 18% (see Item 5. Operating and Financial Review and Prospects  Sources of Revenues and Expenses  Business Net Income). The Board of Directors, upon the advice of the
Compensation Committee, determined that these performance criteria were met for 2009 and 2010.



Using the Black & Scholes method, each option in the March 1, 2010 grant was valued at 9.09, valuing the total benefit at 2,499,750.



Stock options held by Christopher Viehbacher



|                |  |                   |          |  |                      |  |                     |              |  |  |                         |  |  |                     |         |  |                |  |       |  |  |  |                      | 
|--------------- |  | ----------------- | -------- |  | -------------------- |  | ------------------- | ------------ |  |  | ----------------------- |  |  | ------------------- | ------- |  | -------------- |  | ----- |  |  |  | -------------------- | 
|Origin          |  | Date ofBoardgrant |          |  | Nature of theoptions |  |                     | Value (in ) |  |  | Numberof optionsawarded |  |  | Exerciseprice(in ) |         |  | Exerciseperiod | 
|Sanofi -aventis |  |                   | 03/02/09 |  |                      |  | Subscriptionoptions |              |  |  | 1,237,500               |  |  |                     | 250,000 |  |                |  | 45.09 |  |  |  | 03/04/201303/01/2019 | 
|Sanofi -aventis |  |                   | 03/01/10 |  |                      |  | Subscriptionoptions |              |  |  | 2,499,750               |  |  |                     | 275,000 |  |                |  | 54.12 |  |  |  | 03/03/201402/28/2020 | 



On March 2, 2009, 250,000 stock subscription options were granted to Christopher Viehbacher: 200,000 in accordance with what had been
contemplated on the announcement of his appointment in September 2008, and 50,000 more as part of the 2009 stock option plan. All of his stock options are subject to a performance condition. The performance condition must be fulfilled for each
financial year preceding the exercise period (2009, 2010, 2011 and 2012), and requires the ratio of adjusted net income excluding selected items (which was a non-GAAP financial measure used until the end of 2009) to net sales to be at least 18%. The
Board of Directors upon the advice of the Compensation Committee, determined that these performance criteria were met for 2009 and 2010.



The options awarded to the Chief Executive Officer in 2010 represent 0.8% of the maximum total grant approved at the Shareholders
Annual General Meeting of April 17, 2009 (2.5% of our share capital) and 3.38% of the total grant made to all of the beneficiaries on March 1, 2010.



As of the date of this annual report, the number of outstanding options held by Christopher Viehbacher represented 0.04% of the share
capital as of December 31, 2010.



Christopher
Viehbacher did not exercise any stock options in 2009 or 2010. None of his stock option plans is currently exercisable.



Performance shares awarded to Christopher Viehbacher in 2010



|               |  |                   |          |  |                                           |  |    |             |  |  |                  |  |  |                   |            |  |  |  |            | 
|-------------- |  | ----------------- | -------- |  | ----------------------------------------- |  | -- | ----------- |  |  | ---------------- |  |  | ----------------- | ---------- |  |  |  | ---------- | 
|Origin         |  | Date ofBoardaward |          |  | Numberof performanceshares awarded in2010 |  |    | Value(in ) |  |  | Acquisition date |  |  | Availability date |           
|Sanofi-aventis |  |                   | 10/27/10 |  |                                           |  | 20 |             |  |  | 887              |  |  |                   | 10/27/2012 |  |  |  | 10/28/2014 | 





Like all Group employees with at least three months service, Christopher Viehbacher was awarded 20 shares as part of Share 2010, a global restricted share plan.



Performance shares awarded to Christopher Viehbacher



At year end 2010 and as of the date of this
annual report, Christopher Viehbacher had been awarded:



|               |  |                   |          |  |                                    |  |        |              |  |  |                  |  |  |                   |            |  |  |  |            | 
|-------------- |  | ----------------- | -------- |  | ---------------------------------- |  | ------ | ------------ |  |  | ---------------- |  |  | ----------------- | ---------- |  |  |  | ---------- | 
|Origin         |  | Date ofBoardaward |          |  | Numberof performanceshares awarded |  |        | Value (in ) |  |  | Acquisition date |  |  | Availability date |           
|Sanofi-aventis |  |                   | 03/01/10 |  |                                    |  | 65,000 |              |  |  | 2,221,700        |  |  |                   | 03/03/2011 |  |  |  | 03/04/2013 | 





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On March 2, 2009, in accordance with what had been contemplated on the announcement of
his appointment in September 2008, 65,000 performance shares were awarded to Christopher Viehbacher. All of his performance shares are subject to a performance condition. The performance condition must be fulfilled each financial year preceding the
vesting of the shares (2009 and 2010), and requires the ratio of adjusted net income excluding selected items (which was a non-GAAP financial measure used until the end of 2009) to net sales to be at least 18%. The value of each performance share
amounts 34.18, valuing the total benefit at 2,221,700.



On February 24, 2011, the Board of Directors, acting on the recommendations of the Compensation Committee, determined that the conditions to the March 2, 2009 grant had been met. As a result the
performance conditions have been fulfilled.



The
March 2, 2009 grant of performance shares will vest on March 3, 2011, and will remain subject to a mandatory lock-up period.



The shares awarded to Christopher Viehbacher in 2009 represent 0.49% of the maximum total grant approved at the Shareholders Annual
General Meeting of April 17, 2009 (1% of our share capital) and 5.44% of the total grant made to all of the beneficiaries on March 2, 2009.



Performance shares awarded to Christopher Viehbacher which became available in 2010.



No performance shares awarded to Christopher Viehbacher
became available in 2010.



Performance shares
awarded to Christopher Viehbacher



As of the
date of this annual report, the number of performance shares awarded to Christopher Viehbacher represented 0.005% of the share capital as of December 31, 2010.



Pension arrangements for Christopher Viehbacher



Christopher Viehbacher is covered by the
sanofi-aventis top-up defined benefit pension plan. The sanofi-aventis plan is offered to all executives of sanofi-aventis and its French subsidiaries who meet the eligibility criteria specified in the plan rules, extended to corporate officers,
including currently Christopher Viehbacher. This plan was set up on October 1, 2008 as the final stage in the process of harmonizing the status of personnel across the French subsidiaries.



This top-up defined-benefit pension plan is offered to
executives (within the meaning of the AGIRC regime  Association Générale des Institutions de Retraite des Cadres, a confederation of executive pension funds) of sanofi-aventis and its French subsidiaries who meet the
eligibility criteria specified in the plan rules; the benefit is contingent upon the plan member ending his or her career within the Group. The plan is reserved for executives with at least ten years service whose annual base compensation has
for ten years exceeded four times the French social security ceiling, and is wholly funded by the Company.



Based on the assumptions used in the actuarial valuation of this plan, approximately 460 executives are potentially eligible for this
plan, almost all of them active executives.



The
top-up pension, which may not exceed 37.50% of final salary, is in the form of a life annuity, and is transferable as a survivors pension. The annuity is based on the arithmetical average of the three highest years average annual gross
compensation (fixed plus variable) paid during the five years (not necessarily consecutive) preceding final cessation of employment. This reference compensation is capped at 60 times the French social security ceiling (PASS) applicable
in the year in which the rights vest. The annuity varies according to length of service (capped at 25 years) and supplements the compulsory industry schemes, subject to a cap on the total pension from all sources equal to 52% of final compensation.



The admission of Christopher Viehbacher to this
plan was approved by the Shareholders General Meeting of April 17, 2009.



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Jean-François Dehecq



Compensation, options and shares awarded to
Jean-François Dehecq



|                                                                        |  |      |           |  |      |  |           | 
|----------------------------------------------------------------------- |  | ---- | --------- |  | ---- |  | --------- | 
|(in euros)                                                              |  | 2010 |           |  | 2009 | 
|Compensation payable for the year (details provided in the table below) |  |      | 4,710,599 |  |      |  | 2,279,995 | 
|Value of stock subscription options awarded during the year             |  |      | 0         |  |      |  | 0         | 
|Value of performance shares awarded during the year                     |  |      | 0         |  |      |  | 0         | 
|Total                                                                   |  |      | 4,710,599 |  |      |  | 2,279,995 | 





Compensation payable and paid to Jean-François Dehecq



|                         |  |         |           |  |      |  |           |         |  |  |           |  |  |  |           | 
|------------------------ |  | ------- | --------- |  | ---- |  | --------- | ------- |  |  | --------- |  |  |  | --------- | 
|                         |  | 2010    |           |  | 2009 | 
|(in euros)               |  | Payable |           |  | Paid |  |           | Payable |  |  | Paid      | 
|Fixed compensation(1)    |  |         | 541,665   |  |      |  | 541,665   |         |  |  | 1,300,000 |  |  |  | 1,300,000 | 
|Variable compensation(2) |  |         | 368,062   |  |      |  | 1,343,062 |         |  |  | 975,000   |  |  |  | 975,000   | 
|Exceptional compensation |  |         | 3,799,032 |  |      |  | 3,799,032 |         |  |  | 0         |  |  |  | 0         | 
|Attendance fees          |  |         | 0         |  |      |  | 0         |         |  |  | 0         |  |  |  | 0         | 
|Benefits in kind         |  |         | 1,840     |  |      |  | 1,840     |         |  |  | 4,995     |  |  |  | 4,995     | 
|Total                    |  |         | 4,710,599 |  |      |  | 5,685,599 |         |  |  | 2,279,995 |  |  |  | 2,279,995 | 





The amounts reported are gross amounts before taxes.



|(1) | Fixed compensation payable in respect of a given year is paid during that year.
|--- | -------------------------------------------------------------------------------

|(2) | Generally, variable compensation in respect of a given year is determined and
paid at the start of the following year. As an exception, variable compensation for 2010 was determined and paid in 2010, when Jean-François Dehecq left office.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



For 2010, the fixed compensation and the terms and conditions
of the variable compensation of Jean-François Dehecq were maintained on a pro rata basis for the remainder of his term as Chairman of the Board of Directors, i.e. until May 2010.



For 2010, the variable compensation of Jean-François Dehecq was based 25% on a quantitative criterion
and 75% on qualitative criteria.



The quantitative
criterion used was linked to adjusted earnings per share excluding selected items (which was a non-GAAP financial measure used until the end of 2009).



The qualitative criteria were essentially based on the support provided to the Chief Executive Officer, leadership of the Board of
Directors, input on the Groups global strategy, and representation of the high-level interests of the Group.



The variable compensation could have represented between 60% and 75% of his fixed compensation.



Taking into account the abovementioned criteria, the
performance of the Company and the input of the Chairman of the Board of Directors during 2010, the Board of Directors set the variable compensation of Jean-François Dehecq for 2010 at 368,062.50, i.e., 75% of the fixed portion of his
compensation pro rated through May 17, 2010. His variable compensation was paid in 2010.



The amount reported for benefits in relates to a company car.



No stock options and no shares were granted in 2010. However, under the rules plan, he keeps the benefits of the share subscription
options previously awarded.



Pension
arrangements for Jean-François Dehecq



Jean-François Dehecq was covered by the Sanofi-Synthélabo top-up defined-benefit pension plan established in 2002 (and
amended January 1, 2008) offered to executives of sanofi-aventis and its French



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subsidiaries who meet the eligibility criteria specified in the plan rules, the benefit of which is contingent upon the plan member ending his or her career within the Group. The plan is wholly
funded by the Company.



Based on the assumptions
used in the actuarial valuation of this plan, 91 executives are beneficiaries or potentially eligible for this plan.



Effective October 1, 2008, this plan was closed to any new eligible executive following the harmonization of the top-up
defined-benefit pension plans of the French subsidiaries of the Aventis Group (including the Vaccine Division) and the Sanofi-Synthélabo Group, which merged in 2005. Nevertheless, it was replaced by the substantially similar
sanofi-aventis plan. It is offered to all executives (within the meaning of the AGIRC regime  Association Générale des Institutions de Retraite des Cadres, a confederation of executive pension funds) of
sanofi-aventis and its French subsidiaries, extended to corporate officers, including Christopher Viehbacher (see above).



The top-up pension, which may not exceed 37.50% of final salary, is in the form of a life annuity, and is transferable as a
survivors pension. The annuity is based on the arithmetical average of the three highest years average annual gross compensation (fixed plus variable) paid during the five years (not necessarily consecutive) preceding final cessation of
employment. This reference compensation is capped at 60 times the French social security ceiling (PASS) applicable in the year in which the rights vest. The annuity varies according to length of service (capped at 25 years) and
supplements the compulsory industry schemes, subject to a cap equal to 52% of final salary on the total pension from all sources.



In accordance with the generally applicable rules of the French compulsory pension schemes (social security, ARRCO and AGIRC) and the
rules of the Sanofi-Synthélabo top-up defined benefit plan, Jean-François Dehecq requested the liquidation of his pension plans on May 17, 2010, with benefits commencing June 1, 2010. Between June 1 and December 31,
2010, the gross annual pension that he received from the top-up defined benefit plan amounted to 454,387, which would amount on a full year basis to an annual gross pension of 778,944.



Severance arrangements for Jean-François Dehecq



Jean-François Dehecqs
termination benefit was approved at successive Shareholders Annual General Meetings, most recently that of May 14, 2008. Payment of the termination benefit, which was equivalent to 20 months of his last total compensation (fixed plus
variable), was contingent upon fulfillment of two out of three performance criteria.



The first criterion was that the sanofi-aventis share price had outperformed the CAC 40 index since he first took office as Chairman and Chief Executive Officer of the Company on February 15, 1988.



The two other criteria, fulfillment of which
would be assessed over the three financial years preceding his ceasing to hold office, were:



| |  |  | the average of the ratios of adjusted net income excluding selected items (which was a non-GAAP financial measure used until the end of 2009) to net
sales for each financial year had to be at least 15%.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the average of the ratios of operating cash flow before changes in working capital to net sales for each financial year had to be at least 18%.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------



Payment of the termination
benefit was not limited to non-voluntary departure linked to a change in control or strategy, but also covered retirement. This commitment was approved before the adoption of the AFEP-MEDEF corporate governance code. Following the liquidation of his
pension plans in May 2010, sanofi-aventis executed its contractual obligations in favor of Jean-François Dehecq.



On May 17, 2010, upon the recommendation of the Compensation Committee, and in accordance with the provisions of the general meeting
of May 14, 2008, the Board of Directors acknowledged that the conditions for awarding Jean-François Dehecq a termination benefit equivalent to 20 months of his last total compensation (fixed plus variable) had been fulfilled. The Board
of Directors authorized termination benefit to be paid in full. This termination benefit, amounting to 3,799,032, was paid in May 2010.



These provisions exclude all other termination benefits for any reason whatsoever.



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##### Table of Contents

Commitments in favor of the Chairman and the Chief Executive Officer in office as of December 31,
2010.



|                       |  |                       |  |                    |     |  |                                                                                |  |     |                                                |  |  |    | 
|---------------------- |  | --------------------- |  | ------------------ | --- |  | ------------------------------------------------------------------------------ |  | --- | ---------------------------------------------- |  |  | -- | 
|Executive director     |  | Contract ofemployment |  | Top-up pensionplan |     |  | Compensation or benefitspayable or potentiallypayable on 
terminationof office |  |     | Compensationpayable undernon-competitionclause | 
|Serge Weinberg         |  | No                    |  |                    | No  |  |                                                                                |  | No  |                                                |  |  | No | 
|Christopher Viehbacher |  | No                    |  |                    | Yes |  |                                                                                |  | Yes |                                                |  |  | No | 



In the event of his removal from office as Chief Executive Officer, Christopher Viehbacher would receive a termination benefit equivalent
to 24 months of total compensation on the basis of his fixed compensation effective on the date he ceases to hold office and the last variable compensation received prior to that date, subject to the performance criteria described below.



In accordance with article L. 225-42-1 of the French
Commercial Code, payment of the termination benefit would be contingent upon fulfillment of two of the three performance criteria, assessed over the three financial years preceding his ceasing to hold office or, if he leaves office prior to the end
of the 2011 financial year, the most recently ended financial years.



The three criteria are:



| |  |  | the average of the ratios of adjusted net income excluding selected items (which was a non-GAAP financial measure used until the end of 2009) to net
sales for each financial year must be at least 15%;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the average of the ratios of operating cash flow before changes in working capital to net sales for each financial year must be at least 18%;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the average of the growth rates for the Groups activities, measured for each financial year in terms of net sales on a comparable basis, must be
at least equal to the average of the growth rates of the Pharmaceutical and Vaccines activities of the top 12 global pharmaceutical companies, measured for each financial year in terms of net sales adjusted for the principal effects of exchange
rates and changes in scope of consolidation.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The terms for the termination benefit entitlement of Christopher Viehbacher were approved by the Shareholders Annual General Meeting of April 17, 2009.



Any activation of this termination benefit will be carried
out in compliance with the AFEP-MEDEF corporate governance code, i.e. only if the departure is non-voluntary and linked to a change in control or strategy.



Lock-up period for shares obtained on exercise of stock
options by, or disposition of performance shares, by the Chief Executive Officer



Until he ceases to hold office, the Chief Executive Officer will be required to retain, in the form of sanofi-aventis shares, 50% of any capital gains (net of taxes and social contributions) obtained by
the exercise of stock options or upon disposition of performance shares awarded by sanofi-aventis. He must hold these shares as registered shares.



As called for by the AFEP-MEDEF corporate governance code, the Charter of the sanofi-aventis Board of Directors forbids the Chief
Executive Officer from contracting any hedging instruments in respect of his own interests, and, as far as sanofi-aventis is aware, no such instruments have been contracted.



Compensation and pension payments for directors other than the Chairman
and the Chief Executive Officer



Attendance fees



The table below shows amounts paid to each member of the sanofi-aventis Board of Directors in respect of 2009 and 2010, including those
whose term of office ended during the year.



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##### Table of Contents

Attendance fees in respect of 2009, the amount of which was set by the Board meeting of
March 1, 2010, were paid in 2010.



Attendance
fees in respect of 2010, the amount of which was set by the Board meeting of February 24, 2011, will be paid in 2011.



For 2010, the basic annual attendance fee was set at 15,000, apportioned on a time basis for directors who assumed or left office
during the year.



The variable portion of the fee
is linked to actual attendance by directors in accordance with the principles described below:



| |  |  | directors resident in France receive 5,000 per Board or Committee meeting attended, except for Audit Committee meetings for which the fee is
7,500 per meeting;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | directors resident outside France receive 7,000 per Board meeting attended, and 7,500 per Committee meeting attended;
| | - |  | -----------------------------------------------------------------------------------------------------------------------



| |  |  | the chairman of the Compensation Committee receives 7,500 per Committee meeting;
| | - |  | ---------------------------------------------------------------------------------



| |  |  | the chairman of the Audit Committee, who is resident outside France, receives 10,000 per Committee meeting.
| | - |  | ------------------------------------------------------------------------------------------------------------



The attendance fee payable to a Director who participates by
conference call or by videoconference is equivalent to half of the attendance fee received by a French Director who attends in person.



As an exception, some meetings give entitlement to a single attendance fee :



| |  |  | If on the day of a Shareholders General Meeting, the Board of Directors meets before and after the Meeting, only one attendance fee is paid
for both.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | If a Director participates in a meeting of the Compensation Committee and in a meeting of the Appointments and Governance Committee the same day, only
one attendance fee is paid for both.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



If necessary, a reduction coefficient is applied to this scale in order to keep attendance fees within the total attendance fee entitlement.



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|                                    |  |                                                     |           |  |                      |  |           |                                 |  |  |                               |  |  |                                                      |           |  |                      |  |           |                                 |  |  |                               |  |  |  |         |  |  |  |           |  |  |  |           |  |  |  |           | 
|----------------------------------- |  | --------------------------------------------------- | --------- |  | -------------------- |  | --------- | ------------------------------- |  |  | ----------------------------- |  |  | ---------------------------------------------------- | --------- |  | -------------------- |  | --------- | ------------------------------- |  |  | ----------------------------- |  |  |  | ------- |  |  |  | --------- |  |  |  | --------- |  |  |  | --------- | 
|(in euro)                           |  | 2010                                                |           |  | 2009                 | 
|Name                                |  | Attendance
feesin respect of 2010to be paid in 2011 |           |  | Pensionspaid in
2010 |  |           | Totaltheoreticalcompensation(6) |  |  | Totaleffectivecompensation(7) |  |  | Attendance
feesin respect of 2009 to be paid in 2010 |           |  | Pensionspaid in
2009 |  |           | Totaltheoreticalcompensation(8) |  |  | Totaleffectivecompensation(9) | 
|                                    |  | fixed                                               |           |  | variable             |  |           |                                 |  |  |                               |  |  |                                                      |           |  | fixed                |  |           | Variable                        |  |  |                               |  |  |  |         |  |  | 
|Uwe Bicker                          |  |                                                     | 15,000    |  |                      |  | 98,500    |                                 |  |  |                               |  |  |                                                      | 113,500   |  |                      |  | 105,848   |                                 |  |  | 15,000                        |  |  |  | 71,000  |  |  |  |           |  |  |  | 86,000    |  |  |  | 85,519    | 
|Jean-Marc Bruel(1)                  |  |                                                     | 5,625     |  |                      |  | 47,500    |                                 |  |  | 141,380                       |  |  |                                                      | 194,505   |  |                      |  | 190,923   |                                 |  |  | 15,000                        |  |  |  | 90,000  |  |  |  | 376,189   |  |  |  | 481,189   |  |  |  | 480,601   | 
|Robert Castaigne                    |  |                                                     | 15,000    |  |                      |  | 107,500   |                                 |  |  |                               |  |  |                                                      | 122,500   |  |                      |  | 114,241   |                                 |  |  | 15000                         |  |  |  | 107,500 |  |  |  |           |  |  |  | 122,500   |  |  |  | 121,814   | 
|Patrick de La Chevardière (2)       |  |                                                     | 7,500     |  |                      |  | 15,000    |                                 |  |  |                               |  |  |                                                      | 22,500    |  |                      |  | 20,983    |                                 |  |  | 15,000                        |  |  |  | 27,500  |  |  |  |           |  |  |  | 42,500    |  |  |  | 42,262    | 
|Thierry Desmarest                   |  |                                                     | 15,000    |  |                      |  | 92,500    |                                 |  |  |                               |  |  |                                                      | 107,500   |  |                      |  | 100,253   |                                 |  |  | 15,000                        |  |  |  | 62,500  |  |  |  |           |  |  |  | 77,500    |  |  |  | 77,066    | 
|Lord Douro                          |  |                                                     | 15,000    |  |                      |  | 116,000   |                                 |  |  |                               |  |  |                                                      | 131,000   |  |                      |  | 122,168   |                                 |  |  | 15,000                        |  |  |  | 79,000  |  |  |  |           |  |  |  | 94,000    |  |  |  | 93,474    | 
|Jean-René Fourtou                   |  |                                                     | 15,000    |  |                      |  | 97,500    |                                 |  |  | 1,618,818                     |  |  |                                                      | 1,731,318 |  |                      |  | 1,723,733 |                                 |  |  | 15,000                        |  |  |  | 62,500  |  |  |  | 1,602,013 |  |  |  | 1,679,513 |  |  |  | 1,679,079 | 
|Claudie Haigneré                    |  |                                                     | 15,000    |  |                      |  | 65,000    |                                 |  |  |                               |  |  |                                                      | 80,000    |  |                      |  | 74,607    |                                 |  |  | 15,000                        |  |  |  | 60,000  |  |  |  |           |  |  |  | 75,000    |  |  |  | 74,580    | 
|Igor Landau                         |  |                                                     | 15,000    |  |                      |  | 42,500    |                                 |  |  | 2,216,308                     |  |  |                                                      | 2,273,808 |  |                      |  | 2,269,931 |                                 |  |  | 15,000                        |  |  |  | 47,500  |  |  |  | 2,193,300 |  |  |  | 2,255,800 |  |  |  | 2,255,450 | 
|Christian Mulliez                   |  |                                                     | 15,000    |  |                      |  | 42,500    |                                 |  |  |                               |  |  |                                                      | 57,500    |  |                      |  | 53,623    |                                 |  |  | 15,000                        |  |  |  | 47,500  |  |  |  |           |  |  |  | 62,500    |  |  |  | 62,150    | 
|Lindsay Owen-Jones                  |  |                                                     | 15,000    |  |                      |  | 62,500    |                                 |  |  |                               |  |  |                                                      | 77,500    |  |                      |  | 72,275    |                                 |  |  | 15,000                        |  |  |  | 47,500  |  |  |  |           |  |  |  | 62,500    |  |  |  | 62,150    | 
|Klaus Pohle                         |  |                                                     | 15,000    |  |                      |  | 143,500   |                                 |  |  |                               |  |  |                                                      | 158,500   |  |                      |  | 147,814   |                                 |  |  | 15,000                        |  |  |  | 141,000 |  |  |  |           |  |  |  | 156,000   |  |  |  | 155,127   | 
|Carole Piwnica(3)                   |  |                                                     | 0         |  |                      |  | 0         |                                 |  |  |                               |  |  |                                                      | 0         |  |                      |  | 0         |                                 |  |  | 0                             |  |  |  | 0       |  |  |  |           |  |  |  | 0         |  |  |  | 0         | 
|Gunter Thielen (4)                  |  |                                                     | 0         |  |                      |  | 0         |                                 |  |  |                               |  |  |                                                      | 0         |  |                      |  | 0         |                                 |  |  | 12,500                        |  |  |  | 22,000  |  |  |  |           |  |  |  | 34,500    |  |  |  | 34, 307   | 
|Gérard Van Kemmel                   |  |                                                     | 15,000    |  |                      |  | 142,500   |                                 |  |  |                               |  |  |                                                      | 157,500   |  |                      |  | 146,882   |                                 |  |  | 15,000                        |  |  |  | 127,500 |  |  |  |           |  |  |  | 142,500   |  |  |  | 141,702   | 
|Serge Weinberg(5)                   |  |                                                     | 5,625     |  |                      |  | 30,000    |                                 |  |  |                               |  |  |                                                      | 35,625    |  |                      |  | 33,223    |                                 |  |  | 1,250                         |  |  |  | 5,000   |  |  |  |           |  |  |  | 6,250     |  |  |  | 6,215     | 
|Total                               |  |                                                     | 183,750   |  |                      |  | 1,103,000 |                                 |  |  | 3,976,506                     |  |  |                                                      | 5,263,256 |  |                      |  | 5,176,504 |                                 |  |  | 208,750                       |  |  |  | 998,000 |  |  |  | 4,171,502 |  |  |  | 5,378,252 |  |  |  | 5,371,496 | 
|Total attendance fees (theoretical) |  |                                                     | 1,286,750 |  |                      |  |           |                                 |  |  |                               |  |  |                                                      |           |  |                      |  | 1,206,750 |                                 |  |  |                               |  |  |  |         |  |  |  |           | 
|Total attendance fees (effective)   |  |                                                     | 1,199,997 |  |                      |  |           |                                 |  |  |                               |  |  |                                                      |           |  |                      |  | 1,199,994 |                                 |  |  |                               |  |  |  |         |  |  |  |           | 



|(1) | Left office May 17, 2010. Compensation from January 1, 2010 to
May 17, 2010
|--- | ---------------------------------------------------------------------------

|(2) | Left office July 1, 2010.
|--- | -------------------------

|(3) | Assumed office December 15, 2010.
|--- | ---------------------------------

|(4) | Left office November 24, 2009.
|--- | ------------------------------

|(5) | Assumed office December 16, 2009. Compensation until May 17, 2010.
|--- | ------------------------------------------------------------------

|(6) | Before reducing pro rata by 0.93%
|--- | ---------------------------------

|(7) | After reducing pro rata by 0.93%.
|--- | ---------------------------------

|(8) | Before reducing pro rata by 0.56 %.
|--- | -----------------------------------

|(9) | After reducing pro rata by 0.56 %.
|--- | ----------------------------------



Pensions



The amount recognized in 2010 in respect of corporate pension plans for directors with current or past
executive responsibilities at sanofi-aventis (or companies whose obligations have been assumed by sanofi-aventis) was 2.4 million.



As retirees, Jean-Marc Bruel, Jean-René Fourtou and Igor Landau are covered by the GRCD top-up pension plan instituted
in 1977 for senior executives of Rhône-Poulenc. This plan was amended in 1994, 1996, 1999 and 2003, and currently applies to 2 active executives, 3 early retirees and 26 retired executives. At its meeting of February 11, 2008, the Board
of Directors decided to close this plan to new entrants. Christopher Viehbacher does not benefit from this top-up pension plan.



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Compensation of senior management



The compensation of the other Executive Committee members is
based on an analysis of the practices of major global pharmaceutical companies and the recommendation of the Compensation Committee.



In addition to fixed compensation, these key executives receive variable compensation, the amount of which is determined by the actual
performance and growth of the business areas for which he or she is responsible. Variable compensation generally represents 60% to 110% of their fixed compensation.



These compensation packages may be supplemented by the
granting of stock options and performance shares (see Item 6. Directors, Senior Management and Employees  E. Share Ownership for details of the related plans).



In 2010, total gross compensation before social charges paid
to or accrued for the members of our Executive Committee in office in 2010, including the Chief Executive Officer, amounted to 12.3 million. Fixed compensation represented 5.6 million for the members of the Executive Committee.



|               |  |                                 |          |  |                    |  |          |                                   |  |  |                             |  |  |                    |          |  |                     |  |          |                                |  |  |                               |  |  |                   |   |  |  |  |        |  |  |  |         | 
|-------------- |  | ------------------------------- | -------- |  | ------------------ |  | -------- | --------------------------------- |  |  | --------------------------- |  |  | ------------------ | -------- |  | ------------------- |  | -------- | ------------------------------ |  |  | ----------------------------- |  |  | ----------------- | - |  |  |  | ------ |  |  |  | ------- | 
|Origin         |  | Date ofshareholderauthorization |          |  | Date of Boardgrant |  |          | Grant toExecutiveCommitteeMembers |  |  | Start dateof exerciseperiod |  |  | Expirationdate
(2) |          |  | Purchaseprice(in ) |  |          | Numberexercisedas of12/31/2010 |  |  | Numbercanceledas of12/31/2010 |  |  | Numberoutstanding |  
|Sanofi-Aventis |  |                                 | 05/31/07 |  |                    |  | 12/13/07 |                                   |  |  | 520,000                     |  |  |                    | 12/14/11 |  |                     |  | 12/13/17 |                                |  |  | 62.33                         |  |  |                   | 0 |  |  |  | 0      |  |  |  | 520,000 | 
|Sanofi-Aventis |  |                                 | 05/31/07 |  |                    |  | 03/02/09 |                                   |  |  | 650,000                     |  |  |                    | 03/04/13 |  |                     |  | 03/01/19 |                                |  |  | 45.09                         |  |  |                   | 0 |  |  |  | 50,000 |  |  |  | 600,000 | 
|Sanofi-Aventis |  |                                 | 04/17/09 |  |                    |  | 03/01/10 |                                   |  |  | 805,000                     |  |  |                    | 03/03/14 |  |                     |  | 02/28/20 |                                |  |  | 54.12                         |  |  |                   | 0 |  |  |  | 50,000 |  |  |  | 755,000 | 



In 2010, 805,000 stock options were granted to the nine members of our Executive Committee (including the 275,000 stock options granted to
Christopher Viehbacher). On March 1, 2010, the Board of Directors decided upon the recommendation of the Compensation Committee to subject all the stock options granted to the Chief Executive Officer and half of the stock options granted to the
other members of the Executive Committee to a performance condition. The performance condition must be fulfilled for each financial year preceding the exercise period (2010, 2011, 2012 and 2013), and requires the ratio of business net income (which
was a non-GAAP financial measure used until the end of 2009) to net sales to be at least 18% (see Item 5. Operating and Financial Review and Prospects  Business Net Income). The Board of Directors, upon the advice of the
Compensation Committee, determined that these performance criteria were met for 2009 and 2010.



As of December 31, 2010, 2,671,777 options had been granted to the members of our Executive Committee. As of the same date, 2,353,762 options granted to the members of our Executive
Committee were outstanding. These figures include the options granted to Christopher Viehbacher, who is a member of our Executive Committee. The exercise date and other basic characteristics of such options are set out in the table  E.
Share Ownership  Existing Options Plans as of December 31, 2010 below.



In 2010, 20 restricted shares were awarded to any employee with at least three months service, including the members of our Executive Committee (including Christopher Viehbacher) as part of Share
2010, a global restricted share plan. All members of our Executive Committee subsequently renounced delivery of these restricted shares.



Under French law, directors may not receive options solely as compensation for service on our Board, and thus our Company may grant
options only to those directors who are also our officers.



Because some of our non-executive directors were formerly officers or executive officers of our Company or its predecessor companies, some of our non-executive directors hold sanofi-aventis stock options.



We do not have separate profit-sharing plans for
key executives. As employees, they are able to participate in our voluntary and statutory profit-sharing schemes on the same terms as our other employees. These plans are described below under  Employees  Profit-sharing
schemes.



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The total amount accrued and recognized in the income statement for the year ended
December 31, 2010 in respect of corporate pension plans for (i) directors with current or past executive responsibilities at sanofi-aventis or at companies whose obligations have been assumed by sanofi-aventis and (ii) members of the
Executive Committee was 58.7 million.



This
total amount accrued for the year ended December 31, 2009 included 140.3 million for members of the Executive Committee collectively.



C. Board Practices



Neither we nor our subsidiaries have entered into service contracts with members of our Board of Directors providing for benefits upon
termination of employment. With respect to Christopher Viehbacher, see also  B. Compensation  Christopher Viehbacher above.



Sanofi-aventis follows the guidelines contained in the AFEP-MEDEF corporate governance code as amended.



Since 1999, our Board of Directors has been assisted in its
deliberations and decisions by specialist committees. Members of these committees are chosen by the Board from among its members, based on their experience.



Audit Committee



At December 31, 2010, the Audit Committee comprised:



| |  |  | Klaus Pohle, Chairman;
| | - |  | ----------------------



| |  |  | Robert Castaigne; and
| | - |  | ---------------------



| |  |  | Gérard Van Kemmel.
| | - |  | ------------------



Two of the three members of the Audit Committee are independent Directors as this term is generally employed by the Board. All its
members, including Robert Castaigne, are independent within the terms of the Sarbanes-Oxley Act. In addition all three members of this committee have financial or accounting expertise as a result of their training and work experience and qualify
both as financial experts under French standards and as financial experts within the terms of the Sarbanes-Oxley Act and French legislation. See Item 16A. Audit Committee Financial Expert. The Committee must be composed of at least three
Directors; neither the Chairman nor the Chief Executive Officer may be members. At least two-thirds of its members must be independent, and a Director belonging to another company the audit committee of which includes a sanofi-aventis Director may
not be appointed to the Audit Committee.



The
roles of the Audit Committee are to review:



| |  |  | the process for the preparation of financial information;
| | - |  | ---------------------------------------------------------



| |  |  | the effectiveness of the internal control and risk management systems;
| | - |  | ----------------------------------------------------------------------



| |  |  | the audit of the parent company financial statements and consolidated financial statements by the statutory auditors; and
| | - |  | -------------------------------------------------------------------------------------------------------------------------



| |  |  | the independence of the statutory auditors.
| | - |  | -------------------------------------------



The role of the Committee is not so much to examine the financial statements in detail as to monitor the process of preparing them and to
assess the validity of elective accounting treatments used for significant transactions.



In fulfilling its role, the Committee interviews the statutory auditors and the officers responsible for finance, accounting and treasury management. It is possible for such interviews to take place
without the Chief Executive Officer being present if the Committee sees fit. The Committee may also visit or interview managers of operational entities in furtherance of its role, having given prior notice to the Chairman of the Board and to the
Chief Executive Officer.



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The Committee interviews the person responsible for internal audit, and gives its opinion on
the organization of the internal audit function. The Committee receives the internal audit reports or a periodic summary of these reports.



The Committee reviews the scope of consolidation and, as the case may be, the reasons why companies are included in or excluded from such
scope.



The Committee has authority to consult
external experts at the Companys expense, after first informing the Chairman of the Board or the Board of Directors, and shall report on its use of such authority to the Board of Directors.



The examination of the financial statements by the Audit
Committee is accompanied by a presentation by the statutory auditors highlighting key issues not only regarding the financial results but also the elective accounting treatments used, along with a presentation by the Chief Financial Officer
describing the Groups risk exposure and significant off balance sheet commitments.



In addition, the Committee:



| |  |  | directs the selection process for the statutory auditors when their mandates are due for renewal, submits the results of this process to the Board of
Directors, and issues a recommendation;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | is informed of the fees paid to the statutory auditors, ensures that the signatory partners are rotated, and oversees compliance with other rules
relating to auditor independence;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | with the statutory auditors, assesses any factors that may compromise the auditors independence and any measures taken to mitigate such risk; the
Committee ensures in particular that the amount of fees paid by the Company and the Group, or the percentage such fees represent of the auditors firms or networks, are not likely to compromise the auditors independence;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | approves in advance any request for the statutory auditors to provide services that are incidental or complementary to the audit of the financial
statements, in accordance with applicable law;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | ensures that internal early warning procedures relating to accounting, internal accounting controls and audit are in place and applied; and
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | ensures that independent Directors receive no compensation other than attendance fees.
| | - |  | --------------------------------------------------------------------------------------



During 2010, the Audit Committee met seven times.



Compensation Committee



At December 31, 2010, this Committee was composed of:



| |  |  | Gérard Van Kemmel, Chairman;
| | - |  | ----------------------------



| |  |  | Thierry Desmarest;
| | - |  | ------------------



| |  |  | Jean-René Fourtou;
| | - |  | ------------------



| |  |  | Claudie Haigneré; and
| | - |  | ---------------------



| |  |  | Lindsay Owen-Jones.
| | - |  | -------------------



The Compensation Committee is composed of five Board members, three of whom are independent. A majority of its members must be
independent. No executive Directors may be members and a Director belonging to another company the compensation committee of which includes a sanofi-aventis Director may not be appointed to the Compensation Committee.



The roles of the Compensation Committee are:



| |  |  | to make recommendations and proposals to the Board about the compensation, pension and welfare plans, top-up pension plans, benefits in kind and other
pecuniary benefits of the executive directors of sanofi-aventis, and about the granting of restricted shares, performance shares and stock options;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| |  |  | to define the methods used to set the variable portion of the compensation of the executive directors, and check that these methods are applied;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | to formulate general policy on the granting of restricted shares, performance shares, and stock options, and to determine the frequency of grants for
each category of grantee;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | to review the system for allocating attendance fees among Directors; and
| | - |  | ------------------------------------------------------------------------



| |  |  | to advise the Chief Executive Officer on the compensation of key senior executives.
| | - |  | -----------------------------------------------------------------------------------



The Committee also assists in the preparation of the sections
of the Companys French reference document that describe the Companys policy with respect to the granting of purchase or subscription options, restricted shares or performance shares, and executive compensation.



The Committee has authority to consult external experts at
the Companys expense, after first informing the Chairman of the Board or the Board of Directors, and shall report on its use of such authority to the Board of Directors.



The Committee is informed of the compensation policy
applicable to the key senior executives other than the Chairman and the Chief Executive Officer. On such occasions, the Committee meets in the presence of the Chairman and the Chief Executive Officer.



The Compensation Committee met four times in 2010.



Appointments and Governance Committee



At December 31, 2010, this Committee was composed of:



| |  |  | Serge Weinberg, Chairman;
| | - |  | -------------------------



| |  |  | Thierry Desmarest;
| | - |  | ------------------



| |  |  | Lord Douro;
| | - |  | -----------



| |  |  | Jean-René Fourtou;
| | - |  | ------------------



| |  |  | Claudie Haigneré;
| | - |  | -----------------



| |  |  | Lindsay Owen-Jones; and
| | - |  | -----------------------



| |  |  | Gérard Van Kemmel.
| | - |  | ------------------



The Appointments and Governance Committee is composed of seven Board members, four of whom are independent. A majority of its members must
be independent.



The roles of the Appointments and
Governance Committee are:



| |  |  | to recommend suitable candidates to the Board for appointment as Directors or executive officers, taking into account the desired composition of the
Board in light of the composition of and changes in the Companys shareholder base, the experience and skills needed for the Boards missions, gender balance of the Board;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | to establish corporate governance rules for the Company, and to oversee the application of those rules;
| | - |  | -------------------------------------------------------------------------------------------------------



| |  |  | to ensure that there is adequate succession planning for the Companys executive bodies, in particular through the establishment of a succession
plan for the Chairman and the Chief Executive Officer so that replacement solutions may be proposed in the event of an unexpected vacancy;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | to oversee compliance with ethical standards within the Company and in its dealings with third parties;
| | - |  | -------------------------------------------------------------------------------------------------------



| |  |  | to organize a procedure for the selection of future independent Directors and to carry out studies of potential candidates prior to any contact
therewith;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------



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| |  |  | to determine whether each Director qualifies as being independent, both on his or her initial appointment and annually prior to publication of the
French reference document, and report its conclusions to the Board of Directors; the Committee may set independence criteria based on those set out in the AFEP-MEDEF code;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | to debate the skills and/or financial expertise of Directors nominated to the Audit Committee and report its conclusions to the Board of Directors;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | to propose methods for evaluating the operating procedures of the Board and its Committees and oversee the application of these methods; and
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | to examine the Chairmans report on corporate governance.
| | - |  | ---------------------------------------------------------



The Committee has authority to consult external experts at
the Companys expense, after first informing the Chairman of the Board or the Board of Directors, and shall report on its use of such authority to the Board of Directors.



The Appointments and Governance Committee met four times in
2010.



Strategy Committee



At December 31, 2010, this Committee was composed of:



| |  |  | Serge Weinberg, Chairman;
| | - |  | -------------------------



| |  |  | Christopher Viehbacher;
| | - |  | -----------------------



| |  |  | Uwe Bicker;
| | - |  | -----------



| |  |  | Thierry Desmarest;
| | - |  | ------------------



| |  |  | Lord Douro;
| | - |  | -----------



| |  |  | Jean-René Fourtou; and
| | - |  | ----------------------



| |  |  | Lindsay Owen-Jones.
| | - |  | -------------------



The Strategy Committee is composed of seven Board members, three of whom are independent. The Committee is composed of the Chairman of the
Board, the Chief Executive Officer and at least three other Directors.



The Strategy Committee is tasked with assessing major strategic options with a view to the development of the Companys business.



It briefs the Board of Directors on issues of major strategic
interest, such as:



| |  |  | acquisition, merger and alliance opportunities;
| | - |  | -----------------------------------------------



| |  |  | divestment opportunities;
| | - |  | -------------------------



| |  |  | development priorities;
| | - |  | -----------------------



| |  |  | financial and stock market strategies, and compliance with key financial ratios;
| | - |  | --------------------------------------------------------------------------------



| |  |  | potential diversification opportunities; and
| | - |  | --------------------------------------------



| |  |  | more generally, any course of action judged essential to the Companys future.
| | - |  | ------------------------------------------------------------------------------



The Strategy Committee met six times in 2010.



The committee worked in particular on the business plan,
external growth opportunities, research and development, and the Oncology and Diabetes divisions.



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D. Employees



Number of Employees



As of December 31, 2010, sanofi-aventis employed 101,575 people worldwide. The tables below give a breakdown of employees by
geographic area and function as of December 31, 2010. Central and Eastern European countries are included in Other Europe.



Employees by geographic area



|                |  |                    |         |  |   |  |       |      |  |  |         |  |  |      |       |  |   |  |        |  |  |  |       | 
|--------------- |  | ------------------ | ------- |  | - |  | ----- | ---- |  |  | ------- |  |  | ---- | ----- |  | - |  | ------ |  |  |  | ----- | 
|                |  | As of December 31, |        
|                |  | 2010               |         |  | % |  |       | 2009 |  |  | %       |  |  | 2008 |       |  | % | 
|France          |  |                    | 25,896  |  |   |  | 25.5% |      |  |  | 27,694  |  |  |      | 26.4% |  |   |  | 28,223 |  |  |  | 28.7% | 
|Other Europe    |  |                    | 28,919  |  |   |  | 28.5% |      |  |  | 30,202  |  |  |      | 28.8% |  |   |  | 25,292 |  |  |  | 25.8% | 
|United States   |  |                    | 12,954  |  |   |  | 12.7% |      |  |  | 14,517  |  |  |      | 13.8% |  |   |  | 15,228 |  |  |  | 15.5% | 
|Japan           |  |                    | 3,153   |  |   |  | 3.1%  |      |  |  | 3,198   |  |  |      | 3.1%  |  |   |  | 3,121  |  |  |  | 3.2%  | 
|Other countries |  |                    | 30,653  |  |   |  | 30.2% |      |  |  | 29,256  |  |  |      | 27.9% |  |   |  | 26,349 |  |  |  | 26.8% | 
|Total           |  |                    | 101,575 |  |   |  | 100%  |      |  |  | 104,867 |  |  |      | 100%  |  |   |  | 98,213 |  |  |  | 100%  | 



Employees by function



|                                |  |                    |         |  |   |  |       |      |  |  |         |  |  |      |       |  |   |  |        |  |  |  |       | 
|------------------------------- |  | ------------------ | ------- |  | - |  | ----- | ---- |  |  | ------- |  |  | ---- | ----- |  | - |  | ------ |  |  |  | ----- | 
|                                |  | As of December 31, |        
|                                |  | 2010               |         |  | % |  |       | 2009 |  |  | %       |  |  | 2008 |       |  | % | 
|Sales                           |  |                    | 32,686  |  |   |  | 32.2% |      |  |  | 34,292  |  |  |      | 32.7% |  |   |  | 33,507 |  |  |  | 34.1% | 
|Research and Development        |  |                    | 16,983  |  |   |  | 16.7% |      |  |  | 19,132  |  |  |      | 18.3% |  |   |  | 18,976 |  |  |  | 19.3% | 
|Production                      |  |                    | 37,504  |  |   |  | 36.9% |      |  |  | 36,849  |  |  |      | 35.1% |  |   |  | 31,903 |  |  |  | 32.5% | 
|Marketing and Support Functions |  |                    | 14,402  |  |   |  | 14.2% |      |  |  | 14,594  |  |  |      | 13.9% |  |   |  | 13,827 |  |  |  | 14.1% | 
|Total                           |  |                    | 101,575 |  |   |  | 100%  |      |  |  | 104,867 |  |  |      | 100%  |  |   |  | 98,213 |  |  |  | 100%  | 



Industrial Relations



Industrial relations within sanofi-aventis are founded on respect and dialogue. In this spirit, employee representatives and management
meet frequently to exchange views, negotiate, sign agreements, and ensure these agreements are being implemented. During 2010, the forums for dialogue with our employees that exist in most of the countries where we operate were kept regularly
informed about the Groups progress and about the transformation program initiated by management in 2009.



At the European level, the sanofi-aventis European Works Council has 40 members and 40 alternates, representing employees from the 27
European Union member states where we operate. During 2010, the European Works Council members received training about the Councils role and prerogatives in light of changes in the legislative framework.



The Council met in March, April, September and October 2010
to give the employee representatives regular updates about developments in the Groups various entities (R&D, Industrial Affairs, Commercial Operations, Vaccines, and Support Functions). These developments reflect the adaptations needed for
us to remain competitive internationally, to migrate our research and industrial facilities towards biotechnologies, and to adjust our sales forces in response to local regulatory constraints (such as exclusion from reimbursement or price
regulation) and to generic competition for some of our flagship products.



These plenary meetings were supplemented by additional meetings with the officers of the European Works Council, providing a more frequent and specific forum for exchanges with the Council on the latest
developments in the Group.



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We also conducted negotiations throughout the year with employee representatives in each
European country affected by the changes. These meetings provided an opportunity for us to explain the changes (commercial operations in Germany, Spain, Italy and France; divestments of sites in England and France; site closures, etc), and to
establish employee support measures best suited to local circumstances (internal retraining, outplacement, voluntary redundancy, early retirement, etc). The objective is to inform employee representatives at the earliest possible stage so that their
views and proposals can be taken into account.



In
order to adapt to the changing U.S. market, including the expected loss of patent exclusivity on a number of major products and increased generic competition, sanofi-aventis made further adjustments to its U.S. workforce in 2010. In October 2010,
the Group announced a reorganization of its operational units to rescale and reposition pharmaceutical operations according to the needs of the drug portfolio. Close to one quarter of the workforce was concerned, representing about 1,700 persons
mainly in commercial operations. Sanofi-aventis put in place departure conditions for these persons including both financial aspects and outplacement support.



In the rest of the world, we continued to implement an action plan in the Philippines, prepared in response to an employee relations
survey conducted in 2009, and also initiated similar surveys in other countries, such as Taiwan and Japan.



The French Group Works Council, consisting of 25 members and 25 alternates plus trade union representatives, met in February, April, July,
October and December 2010. During these meetings, the Council was updated on our activities and financial position, on employment trends within the Group in France, and on the status of our transformation program (reorganization of our R&D,
Chemicals, and Commercial Operations in France, site divestment, etc) and other ongoing projects (such as the integration of companies acquired in France).



In 2010, five amendments to healthcare and welfare agreements were signed, along with an agreement on a 3% uplift to the minimum
guaranteed annual salary.



A further five
amendments to collective compensation agreements were signed in order to extend them to the employees of Oenobiol and Fovea, acquired in 2009.



In addition, specific agreements were signed at sites operated by individual Group companies (sanofi-aventis Recherche et
Développement, Sanofi Winthrop Industrie, Sanofi Chimie, Sanofi-aventis France, sanofi pasteur and sanofi-aventis groupe), for example on the adoption of chemical industry classification at entity level.



In line with our ongoing policies on the employment of
seniors and the prevention of psychosocial risks, a number of initiatives were taken in France during 2010:



| |  |  | Employment of seniors: the Group action plan is being rolled out at entity level (R&D, Industrial Affairs, Vaccines, etc), including the
introduction by Human Resources of a voluntary career development interview with employees aged over 45 (potentially involving some 12,000 people).
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Prevention of psychosocial risks: the Group-wide agreement signed in December 2009 is being implemented through a broad range of initiatives at our 37
sites across France, including training and awareness programs for management, staff, and Health and Safety Committees. In addition, we will be setting up a Stress Observatory at Group level early in 2011.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Finally, negotiations were conducted throughout 2010 on
issues such as ergonomics, training, strategic workforce planning, and employment; these will continue in 2011.



Profit-sharing Schemes, Employee Savings Schemes and Employee Share Ownership



Profit-sharing Schemes



All employees of our French companies belong to voluntary
and statutory profit-sharing schemes.



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Voluntary Scheme (Intéressement des salariés)



These are collective schemes that are optional for the
employer and contingent upon performance. The aim is to give employees an interest in the growth of the business and improvements in its performance.



The amount distributed by our French companies during 2010 in respect of voluntary profit-sharing for the year ended December 31,
2009 represented 4.3% of total payroll.



In June
2008, sanofi-aventis signed a three-year Group-wide agreement, effective from the 2008 financial year, and applicable to all French companies more than 50% owned by sanofi-aventis. Under the agreement, payments under the Group voluntary
profit-sharing scheme are linked to growth in our adjusted net income excluding selected items (which was a non-GAAP financial measure used until the end of 2009). The current agreement will be renegotiated in 2011.



Statutory Scheme (Participation des salariés aux
résultats de lentreprise)



The scheme is a French legal obligation for companies with more than 50 employees that made a profit in the previous financial year.



The amount distributed by our French companies during 2010 in
respect of the statutory scheme for the year ended December 31, 2009 represented 6.8% of total payroll.



In November 2007, sanofi-aventis signed a new Group-wide agreement for an indefinite period, covering all the employees of our French
companies.



An amendment to this agreement was
signed in April 2009, primarily to bring the agreement into line with a change in French legislation (Law 2008-1258 of December 3, 2008) designed to protect against erosion in purchasing power, under which each qualifying employee can elect to
receive some or all of his or her profit-sharing bonus without regard to the normally applicable mandatory lock-up period.



Distribution Formula



In order to favor lower-paid employees, the voluntary and statutory profit-sharing agreements entered into since 2005 split the benefit
between those entitled as follows:



| | - | 60% on the basis of presence during the year; and
| | - | -------------------------------------------------



| | - | 40% on the basis of annual salary, up to a limit of three times the Social Security ceiling.
| | - | --------------------------------------------------------------------------------------------



Employee Savings Schemes and Collective Retirement Savings Plan



The employee savings arrangements operated by sanofi-aventis
are based on a Group savings scheme (Plan Epargne Groupe) and a collective retirement savings plan (Plan Epargne pour la Retraite Collectif). These schemes reinvest the sums derived from the statutory and voluntary profit-sharing
schemes (compulsory investments), and voluntary contributions by employees.



Since June 1, 2008, all of these arrangements have been open to all the employees of our French companies.



In June 2010, 78.4% of the employees who benefited from the profit-sharing schemes opted to invest in the collective retirement savings
plan.



In 2010, 114.7 million and
55.5 million were invested in the Group savings scheme and the collective retirement savings plan respectively through the voluntary and statutory schemes for 2009, and through top-up contributions.



Employee Share Ownership



At December 31, 2010, shares held by employees of
sanofi-aventis and of related companies and by former employees under Group employee savings schemes amounted to 1.44% of the share capital.



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##### Table of Contents

E. Share Ownership



Senior Management



Members of the Executive Committee hold shares of our
Company amounting in the aggregate to less than 1% of the Companys share capital.



At December 31, 2010, a total of 2,671,777 options had been granted to the members of the Executive Committee (plans existing or closed in 2010) and 2,353,762 unexercised options to
subscribe for or to purchase sanofi-aventis shares were held by the members of the Executive Committee. These figures include the options granted to Christopher Viehbacher, who is a member of the Executive Committee. The terms of these options are
summarized in the tables below.



In 2010,
710 stock options were exercised by members of the Executive Committee.



Existing Option Plans as of December 31, 2010



As of December 31, 2010, a total of 82,270,928 options were outstanding, including 5,847,276 options to purchase sanofi-aventis
shares and 76,423,652 options to subscribe for sanofi-aventis shares. Out of this total, 55,663,453 were immediately exercisable, including 5,847,276 options to purchase shares and 49,816,177 options to subscribe for shares.



Stock options (which may be options to subscribe for shares
or options to purchase shares) are granted to employees, the Chairman and the Chief Executive Officer by the Board of Directors on the basis of recommendations from the Compensation Committee.



Granting options is a way of recognizing the beneficiarys contribution to the Groups development,
and also of securing his or her future commitment to the Group.



For each plan, the Compensation Committee and the Board of Directors assess whether it should take the form of options to subscribe for shares or options to purchase shares, based on criteria that are
primarily financial.



A list of beneficiaries is
submitted by the Senior Management to the Compensation Committee, which reviews the list and then submits it to the Board of Directors, which grants the options. The Board of Directors also sets the terms for the exercise of the options (including
the exercise price) and the lock-up period. The exercise price never incorporates a discount, and must be at least equal to the average of the quoted market prices on the 20 trading days preceding the date of grant by the Board. Stock option plans
generally specify a vesting period of four years.



In accordance with the AFEP-MEDEF corporate governance code, all grants of options to the Chief Executive Officer are subject to
performance conditions. The Board of Directors also applies performance conditions to other beneficiaries. (see  B. Compensation  Compensation and pension arrangements for corporate officers).



At its meeting of March 1, 2010, in addition to the
275,000 stock options granted to Christopher Viehbacher, the Board of Directors granted 5,727 beneficiaries a total of 7,846,355 options to subscribe for one sanofi-aventis share each (representing 0.6% of our share capital before dilution). Half
the stock options granted to the members of the Executive Committee and all the stock options granted to Christopher Viehbacher are subject to a performance condition. The performance condition must be fulfilled for each financial year preceding the
exercise period (2010, 2011, 2012 and 2013), and requires the ratio of business net income to net sales to be at least 18% (see Item 5. Operating and Financial Review and Prospects  Business Net Income).



Options granted to the Chief Executive Officer in 2010
represented 0.8% of the maximum total grant approved at the Shareholders Annual General Meeting of April 17, 2009 (2.5% of our share capital) and 3.38% of the total grant made to all of the beneficiaries on March 1, 2010.



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##### Table of Contents

Share Purchase Option Plans



|                  |  |                                 |           |  |                    |  |            |                                  |  |  |                          |  |  |                                               |         |  |                             |  |         |                |  |  |                     |  |  |                                |            |  |                               |  |       |                   |  |  |           |  |  |  |         |  |  |  |           | 
|----------------- |  | ------------------------------- | --------- |  | ------------------ |  | ---------- | -------------------------------- |  |  | ------------------------ |  |  | --------------------------------------------- | ------- |  | --------------------------- |  | ------- | -------------- |  |  | ------------------- |  |  | ------------------------------ | ---------- |  | ----------------------------- |  | ----- | ----------------- |  |  | --------- |  |  |  | ------- |  |  |  | --------- | 
|Origin            |  | Date ofshareholderauthorization |           |  | Date of Boardgrant |  |            | Number ofoptionsinitiallygranted |  |  | -
tocorporateofficers(1) |  |  | - to the 10employeesgrantedthe mostoptions(2) |         |  | Start dateof exerciseperiod |  |         | Expirationdate |  |  | Purchaseprice(in ) |  |  | Numberexercisedas of12/31/2010 |            |  | Numbercanceledas of12/31/2010 |  |       | Numberoutstanding | 
|Synthélabo        |  |                                 | 6/28/1990 |  |                    |  | 12/15/1993 |                                  |  |  | 364,000                  |  |  |                                               | 130,000 |  |                             |  | 104,000 |                |  |  | 12/15/1998          |  |  |                                | 12/15/2013 |  |                               |  | 6.36  |                   |  |  | 352,600   |  |  |  | 5,200   |  |  |  | 6,200     | 
|Synthélabo        |  |                                 | 6/28/1990 |  |                    |  | 10/18/1994 |                                  |  |  | 330,200                  |  |  |                                               | 0       |  |                             |  | 200,200 |                |  |  | 10/18/1999          |  |  |                                | 10/18/2014 |  |                               |  | 6.01  |                   |  |  | 319,300   |  |  |  | 0       |  |  |  | 10,900    | 
|Synthélabo        |  |                                 | 6/28/1990 |  |                    |  | 1/12/1996  |                                  |  |  | 208,000                  |  |  |                                               | 0       |  |                             |  | 52,000  |                |  |  | 1/12/2001           |  |  |                                | 1/12/2016  |  |                               |  | 8.56  |                   |  |  | 188,730   |  |  |  | 0       |  |  |  | 19,270    | 
|Synthélabo        |  |                                 | 6/28/1990 |  |                    |  | 4/05/1996  |                                  |  |  | 228,800                  |  |  |                                               | 0       |  |                             |  | 67,600  |                |  |  | 4/05/2001           |  |  |                                | 4/05/2016  |  |                               |  | 10.85 |                   |  |  | 194,130   |  |  |  | 0       |  |  |  | 34,670    | 
|Synthélabo        |  |                                 | 6/28/1990 |  |                    |  | 10/14/1997 |                                  |  |  | 262,080                  |  |  |                                               | 0       |  |                             |  | 165,360 |                |  |  | 10/14/2002          |  |  |                                | 10/14/2017 |  |                               |  | 19.73 |                   |  |  | 227,638   |  |  |  | 5,200   |  |  |  | 29,242    | 
|Synthélabo        |  |                                 | 6/28/1990 |  |                    |  | 6/25/1998  |                                  |  |  | 296,400                  |  |  |                                               | 148,200 |  |                             |  | 117,000 |                |  |  | 6/26/2003           |  |  |                                | 6/25/2018  |  |                               |  | 28.38 |                   |  |  | 285,880   |  |  |  | 0       |  |  |  | 10,520    | 
|Synthélabo        |  |                                 | 6/23/1998 |  |                    |  | 3/30/1999  |                                  |  |  | 716,040                  |  |  |                                               | 0       |  |                             |  | 176,800 |                |  |  | 3/31/2004           |  |  |                                | 3/30/2019  |  |                               |  | 38.08 |                   |  |  | 390,135   |  |  |  | 5,720   |  |  |  | 320,185   | 
|Sanofi-Synthélabo |  |                                 | 5/18/1999 |  |                    |  | 5/24/2000  |                                  |  |  | 4,292,000                |  |  |                                               | 310,000 |  |                             |  | 325,000 |                |  |  | 5/25/2004           |  |  |                                | 5/24/2010  |  |                               |  | 43.25 |                   |  |  | 4,003,464 |  |  |  | 288,536 |  |  |  | 0         | 
|Sanofi-Synthélabo |  |                                 | 5/18/1999 |  |                    |  | 5/10/2001  |                                  |  |  | 2,936,500                |  |  |                                               | 145,000 |  |                             |  | 286,000 |                |  |  | 5/11/2005           |  |  |                                | 5/10/2011  |  |                               |  | 64.50 |                   |  |  | 275,061   |  |  |  | 125,900 |  |  |  | 2,535,539 | 
|Sanofi-Synthélabo |  |                                 | 5/18/1999 |  |                    |  | 5/22/2002  |                                  |  |  | 3,111,850                |  |  |                                               | 145,000 |  |                             |  | 268,000 |                |  |  | 5/23/2006           |  |  |                                | 5/22/2012  |  |                               |  | 69.94 |                   |  |  | 61,000    |  |  |  | 149,600 |  |  |  | 2,880,750 | 



|(1) | Comprises the Chairman and Chief Executive Officer, the Chief Executive Officer
or equivalent officers as of the date of grant.
|--- | -------------------------------------------------------------------------------------------------------------------------------

|(2) | Employed as of the date of grant.
|--- | ---------------------------------



Share Subscription Option Plans



|                  |  |                                 |           |  |              |  |            |                                  |  |  |                           |  |  |                                                |           |  |                            |  |           |                |  |  |                         |  |  |                                |            |  |                               |  |       |                   |  |  |           |  |  |  |            |  |  |  |            | 
|----------------- |  | ------------------------------- | --------- |  | ------------ |  | ---------- | -------------------------------- |  |  | ------------------------- |  |  | ---------------------------------------------- | --------- |  | -------------------------- |  | --------- | -------------- |  |  | ----------------------- |  |  | ------------------------------ | ---------- |  | ----------------------------- |  | ----- | ----------------- |  |  | --------- |  |  |  | ---------- |  |  |  | ---------- | 
|Origin            |  | Date ofshareholderauthorization |           |  | Date ofgrant |  |            | Numberof optionsinitiallygranted |  |  | -
tocorporateofficers (1) |  |  | - to the 10employeesgrantedthe mostoptions (2) |           |  | Start dateofexerciseperiod |  |           | Expirationdate |  |  | Subscriptionprice(in ) |  |  | Numberexercisedas of12/31/2010 |            |  | Numbercanceledas of12/31/2010 |  |       | Numberoutstanding | 
|Aventis           |  |                                 | 5/26/1999 |  |              |  | 05/11/1999 |                                  |  |  | 877,766                   |  |  |                                                | 0         |  |                            |  | 86,430    |                |  |  | 05/11/2003              |  |  |                                | 05/11/2010 |  |                               |  | 49.65 |                   |  |  | 586,122   |  |  |  | 291,644    |  |  |  | 0          | 
|Aventis           |  |                                 | 5/24/2000 |  |              |  | 11/14/2000 |                                  |  |  | 13,966,871                |  |  |                                                | 1,526,087 |  |                            |  | 1,435,000 |                |  |  | 11/15/2003              |  |  |                                | 11/14/2010 |  |                               |  | 67.93 |                   |  |  | 1,272,007 |  |  |  | 12,694,864 |  |  |  | 0          | 
|Aventis           |  |                                 | 5/24/2000 |  |              |  | 3/29/2001  |                                  |  |  | 612,196                   |  |  |                                                | 0         |  |                            |  | 206,000   |                |  |  | 3/30/2004               |  |  |                                | 3/29/2011  |  |                               |  | 68.94 |                   |  |  | 28,476    |  |  |  | 36,964     |  |  |  | 546,756    | 
|Aventis           |  |                                 | 5/24/2000 |  |              |  | 11/07/2001 |                                  |  |  | 13,374,051                |  |  |                                                | 1,068,261 |  |                            |  | 875,200   |                |  |  | 11/08/2004              |  |  |                                | 11/07/2011 |  |                               |  | 71.39 |                   |  |  | 880,241   |  |  |  | 2,977,475  |  |  |  | 9, 516,335 | 
|Aventis           |  |                                 | 5/24/2000 |  |              |  | 3/06/2002  |                                  |  |  | 1,173,913                 |  |  |                                                | 1,173,913 |  |                            |  | 0         |                |  |  | 3/07/2005               |  |  |                                | 3/06/2012  |  |                               |  | 69.82 |                   |  |  | 0         |  |  |  | 7          |  |  |  | 1,173,906  | 
|Aventis           |  |                                 | 5/14/2002 |  |              |  | 11/12/2002 |                                  |  |  | 11,775,414                |  |  |                                                | 352,174   |  |                            |  | 741,100   |                |  |  | 11/13/2005              |  |  |                                | 11/12/2012 |  |                               |  | 51.34 |                   |  |  | 4,643,971 |  |  |  | 1,881,231  |  |  |  | 5,250,212  | 
|Aventis           |  |                                 | 5/14/2002 |  |              |  | 12/02/2003 |                                  |  |  | 12,012,414                |  |  |                                                | 352,174   |  |                            |  | 715,000   |                |  |  | 12/03/2006              |  |  |                                | 12/02/2013 |  |                               |  | 40.48 |                   |  |  | 5,046,091 |  |  |  | 1,692,290  |  |  |  | 5,274,033  | 
|Sanofi-Synthélabo |  |                                 | 5/18/1999 |  |              |  | 12/10/2003 |                                  |  |  | 4,217,700                 |  |  |                                                | 240,000   |  |                            |  | 393,000   |                |  |  | 12/11/2007              |  |  |                                | 12/10/2013 |  |                               |  | 55.74 |                   |  |  | 188,780   |  |  |  | 212,150    |  |  |  | 3,816,770  | 
|Sanofi-aventis    |  |                                 | 5/31/2005 |  |              |  | 5/31/2005  |                                  |  |  | 15,228,505                |  |  |                                                | 400,000   |  |                            |  | 550,000   |                |  |  | 6/01/2009               |  |  |                                | 5/31/2015  |  |                               |  | 70.38 |                   |  |  | 6,500     |  |  |  | 1,859,580  |  |  |  | 13,362,425 | 
|Sanofi-aventis    |  |                                 | 5/31/2005 |  |              |  | 12/14/2006 |                                  |  |  | 11,772,050                |  |  |                                                | 450,000   |  |                            |  | 585,000   |                |  |  | 12/15/2010              |  |  |                                | 12/14/2016 |  |                               |  | 66.91 |                   |  |  | 0         |  |  |  | 896,310    |  |  |  | 10,875,740 | 
|Sanofi-aventis    |  |                                 | 5/31/2007 |  |              |  | 12/13/2007 |                                  |  |  | 11,988,975                |  |  |                                                | 325,000   |  |                            |  | 625,000   |                |  |  | 12/14/2011              |  |  |                                | 12/13/2017 |  |                               |  | 62.33 |                   |  |  | 0         |  |  |  | 749,780    |  |  |  | 11,239,195 | 
|Sanofi-aventis    |  |                                 | 5/31/2007 |  |              |  | 03/02/2009 |                                  |  |  | 7,736,480                 |  |  |                                                | 250,000   |  |                            |  | 655,000   |                |  |  | 03/04/2013              |  |  |                                | 03/01/2019 |  |                               |  | 45.09 |                   |  |  | 620       |  |  |  | 313,915    |  |  |  | 7,421,945  | 
|Sanofi-aventis    |  |                                 | 4/17/2009 |  |              |  | 03/01/2010 |                                  |  |  | 7,316,355                 |  |  |                                                | 0         |  |                            |  | 665,000   |                |  |  | 03/01/2014              |  |  |                                | 28/02/2020 |  |                               |  | 54.12 |                   |  |  | 0         |  |  |  | 125,020    |  |  |  | 7,191,335  | 
|Sanofi-aventis    |  |                                 | 4/17/2009 |  |              |  | 03/01/2010 |                                  |  |  | 805,000                   |  |  |                                                | 275,000   |  |                            |  | 805,000   |                |  |  | 03/01/2014              |  |  |                                | 29/02/2020 |  |                               |  | 54.12 |                   |  |  | 0         |  |  |  | 50,000     |  |  |  | 755,000    | 



|(1) | Comprises the Chairman and Chief Executive Officer, the Chief Executive Officer,
or equivalent officers as of the date of grant.
|--- | --------------------------------------------------------------------------------------------------------------------------------

|(2) | Employed as of the date of grant.
|--- | ---------------------------------



The main characteristics of our stock options are also
described in Note D.15.8 to our consolidated financial statements, included in Item 18 of this annual report.



Awards of Restricted Shares as of December 31, 2010



Since 2009, the Board of Directors has awarded restricted shares to certain employees in order to give them a direct stake in the
Companys future and performances via trends in the share price, as a partial substitute for the granting of stock options.



Restricted shares are awarded to employees on the basis of a list submitted to the Compensation Committee, which then submits the list to
the Board of Directors, which awards the shares. The Board of Directors sets the vesting conditions for the award, and any lock-up conditions for the shares.



149



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##### Table of Contents

In 2010, the Board of Directors approved both a targeted plan on March 1, 2010 along
the lines of the 2009 plan and a global plan open to all employees with at least three months service on October 27, 2010 (Share 2010, described below).



At its meeting of March 1, 2010, the Board of Directors
set up two plans:



| |  |  | a French plan awarding 531,725 restricted shares to 2,262 beneficiaries, subject to a vesting period of two years followed by a lock-up period of two
years; and
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | an international plan awarding 699,524 restricted shares to 3,333 beneficiaries, subject to a vesting period of four years.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------



No shares were awarded to the
members of the Executive Committee, including Christopher Viehbacher, under the March 2010 plans.



At its meeting of October 27, 2010, in accordance with French legislation on earnings from employment enacted on December 3, 2008, the Board of Directors set up Share 2010, the Groups first
global restricted share plan. This plan awarded 20 restricted shares to each Group employee with at least three months service at the date of the meeting, subject to a presence condition. Share 2010 was deployed in 95 countries, in two
separate plans:



| |  |  | a French plan awarding 556,480 restricted shares to 27,824 beneficiaries, subject to a vesting period of two years followed by a lock-up period of two
years, and.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | an International plan awarding 1,544,860 restricted shares to 77,243 beneficiaries, subject to a vesting period of four years.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------



Under the terms of Share 2010,
the members of the Executive Committee (including Christopher Viehbacher) were beneficiaries of the plan, but they subsequently renounced delivery of the shares.



The award of restricted shares in 2010 represents a dilution
of about 0.25% of the share capital as of December 31, 2010 before dilution.



Restricted Share Plans



|               |  |                                 |         |  |              |  |          |                                |  |  |                           |  |  |                                               |        |  |              |  |        |             |  |  |                  |  |  |                                  |          |  |                                        |  |          |                   |  |  |   |  |  |  |        |  |  |  |           | 
|-------------- |  | ------------------------------- | ------- |  | ------------ |  | -------- | ------------------------------ |  |  | ------------------------- |  |  | --------------------------------------------- | ------ |  | ------------ |  | ------ | ----------- |  |  | ---------------- |  |  | -------------------------------- | -------- |  | -------------------------------------- |  | -------- | ----------------- |  |  | - |  |  |  | ------ |  |  |  | --------- | 
|Origin         |  | Date ofshareholderauthorization |         |  | Date ofaward |  |          | Numberofsharesinitiallyawarded |  |  | -
tocorporateofficers (1) |  |  | - to the 10employeesawardedthe mostshares (2) |        |  | Date ofaward |  |        | Vestingdate |  |  | Availabilitydate |  |  | Numbertransferredas of12/31/2010 |          |  | Numberof rightscanceledas of12/31/2010 |  |          | Numberoutstanding | 
|Sanofi-aventis |  |                                 | 5/31/07 |  |              |  | 03/02/09 |                                |  |  | 590,060                   |  |  |                                               | 65,000 |  |              |  | 13,900 |             |  |  | 03/02/09         |  |  |                                  | 03/03/11 |  |                                        |  | 03/04/13 |                   |  |  | 0 |  |  |  | 3,126  |  |  |  | 586,934   | 
|Sanofi-aventis |  |                                 | 5/31/07 |  |              |  | 03/02/09 |                                |  |  | 604,004                   |  |  |                                               | 0      |  |              |  | 13,200 |             |  |  | 03/02/09         |  |  |                                  | 03/04/13 |  |                                        |  | 03/04/13 |                   |  |  | 0 |  |  |  | 32,571 |  |  |  | 571,433   | 
|Sanofi-aventis |  |                                 | 4/17/09 |  |              |  | 3/01/10  |                                |  |  | 531,725                   |  |  |                                               | 0      |  |              |  | 12 600 |             |  |  | 3/01/10          |  |  |                                  | 03/02/12 |  |                                        |  | 03/03/14 |                   |  |  | 0 |  |  |  | 2,788  |  |  |  | 528,937   | 
|Sanofi-aventis |  |                                 | 4/17/09 |  |              |  | 3/01/10  |                                |  |  | 699,524                   |  |  |                                               | 0      |  |              |  | 16 530 |             |  |  | 3/01/10          |  |  |                                  | 03/02/14 |  |                                        |  | 03/03/14 |                   |  |  | 0 |  |  |  | 20,200 |  |  |  | 679,324   | 
|Sanofi-aventis |  |                                 | 4/17/09 |  |              |  | 10/27/10 |                                |  |  | 556,480                   |  |  |                                               | 20     |  |              |  | 200    |             |  |  | 10/27/10         |  |  |                                  | 10/27/12 |  |                                        |  | 10/28/14 |                   |  |  | 0 |  |  |  | 540    |  |  |  | 555,940   | 
|Sanofi-aventis |  |                                 | 4/17/09 |  |              |  | 10/27/10 |                                |  |  | 1,544,860                 |  |  |                                               | 0      |  |              |  | 200    |             |  |  | 10/27/10         |  |  |                                  | 10/27/14 |  |                                        |  | 10/28/14 |                   |  |  | 0 |  |  |  | 340    |  |  |  | 1,544,520 | 



|(1) | Comprises the Chief Executive Officer as of the date of grant.
|--- | --------------------------------------------------------------

|(2) | Employed as of the date of grant.
|--- | ---------------------------------



As of December 31, 2010, a total of 4,467,088 restricted
shares were outstanding as the vesting period of each plan had not yet expired.



Shares Owned by Members of the Board of Directors



As of December 31, 2010, members of our Board of Directors held in the aggregate 50,497 shares, or under 1% of the share capital and
of the voting rights, excluding the beneficial ownership of 72,186,832 shares held by Total as of such date which may be attributed to Thierry Desmarest (who disclaims beneficial ownership of such shares) and excluding the beneficial ownership
of 118,227,307 shares held by LOréal as of such date which may be attributed to Lindsay Owen-Jones or Christian Mulliez (who disclaim beneficial ownership of such shares).



150



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##### Table of Contents

Transactions in Shares by Members of the Board of Directors and comparable persons in 2010



On February 11, 2010, Serge Weinberg
bought 900 shares at a price of 52.51 per share and 600 shares at a price of 52.35.



On March 2, 2010, Uwe Bicker, Director, bought 300 shares at a price of 54.67 per share.



On March 9, 2010, Karen Linehan, Senior Vice President
Legal Affairs and General Counsel, exercised 710 options to purchase 710 shares at a price of 43.25 per share and sold 710 shares at a price of 56.25 per share (Plan Sanofi-Synthélabo of May 24, 2000).



On March 11, 2010, Lord Douro, Director, bought 450 shares at
a price of £50.80 per share.



151



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##### Table of Contents

Item 7. Major Shareholders and Related Party Transactions



A. Major Shareholders



The table below shows the ownership of our shares as of
January 31, 2011, indicating the beneficial owners of our shares. To the best of our knowledge and on the basis of the notifications received as disclosed below, except as described below no shareholder holds more than 5% of our share capital
or voting rights.



|                    |  |                              |               |  |                                                          |  |       |                                                              |  |  |               |  |  |        |       |  |   |  |               |  |  |  |       | 
|------------------- |  | ---------------------------- | ------------- |  | -------------------------------------------------------- |  | ----- | ------------------------------------------------------------ |  |  | ------------- |  |  | ------ | ----- |  | - |  | ------------- |  |  |  | ----- | 
|                    |  | Total number of issuedshares |               |  | Number of actualvoting rights (excluding own shares) (3) |  |       | Theoretical number ofvoting rights(including own shares) (4) | 
|                    |  | Number                       |               |  | %                                                        |  |       | Number                                                       |  |  | %             |  |  | Number |       |  | % | 
|LOréal             |  |                              | 118,227,307   |  |                                                          |  | 9.02  |                                                              |  |  | 236,454,614   |  |  |        | 15.61 |  |   |  | 236,454,614   |  |  |  | 15.55 | 
|Total               |  |                              | 67,710,891    |  |                                                          |  | 5.16  |                                                              |  |  | 134,719,904   |  |  |        | 8.89  |  |   |  | 134,719,904   |  |  |  | 8.86  | 
|Treasury shares (1) |  |                              | 6,072,712     |  |                                                          |  | 0.46  |                                                              |  |  |              |  |  |        |      |  |   |  | 6,072,712     |  |  |  | 0.40  | 
|Employees (2)       |  |                              | 18,682,750    |  |                                                          |  | 1.43  |                                                              |  |  | 35,229,250    |  |  |        | 2.33  |  |   |  | 35,229,250    |  |  |  | 2.32  | 
|Public              |  |                              | 1,100,311,216 |  |                                                          |  | 83.93 |                                                              |  |  | 1,108,344,542 |  |  |        | 73.17 |  |   |  | 1,108,344,542 |  |  |  | 72.87 | 
|Total               |  |                              | 1,311,004,876 |  |                                                          |  | 100   |                                                              |  |  | 1,514,748,310 |  |  |        | 100   |  |   |  | 1,520,821,022 |  |  |  | 100   | 



|(1) | Includes net position of share repurchases under the Groups liquidity contract which
amounted to 15,000 as of December 31, 2010. Amounts held under this contract vary over time
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Shares held via the sanofi-aventis Group Employee Savings Plan.
|--- | ---------------------------------------------------------------

|(3) | Based on the total number of voting rights as of January 31, 2011.
|--- | ------------------------------------------------------------------

|(4) | Based on the total number of voting rights as of January 31, 2011 as published in accordance
with article 223-11 and seq. of the General Regulations of the Autorité des Marchés Financiers (i.e., calculated before suspension of the voting rights of treasury shares).
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Our statuts(Articles of Association) provide for
double voting rights for shares held in registered form for at least two years. All of our shareholders may benefit from double voting rights if these conditions are met, and no shareholder benefits from specific voting rights. For more information
relating to our shares, see Item 10. Additional Information  B. Memorandum and Articles of Association.



LOréal and Total are the only two entities known to hold more than 5% of the outstanding sanofi-aventis ordinary shares.
These entities reduced their holdings from 2007 to 2010 after no significant changes in 2006 and 2005. At year end 2006, their respective holdings were 10.52% and 13.13% of our share capital compared to 9.02% and 5.51% on December 31, 2010.



On May 17, 2010, our shareholder Total
declared that it had passed below the legal threshold of 10% of voting rights as a result of its share sales, and held as of the declaration date shares representing 5.88% of our share capital and 9.78% of our voting rights.



In accordance with our statuts, shareholders are
required to notify us once they have passed the threshold of 1% of our share capital or our voting rights and each time they cross an incremental 1% threshold (see Item 10. Additional Information  B. Memorandum and Articles of
Association  Requirements for Holdings Exceeding Certain Percentages).



For the year ended December 31, 2010, we were informed that the following share ownership declaration thresholds had been passed:



Amundi declared that it had passed successively above and
below the thresholds of 3% and 4% of our share capital as a result of holdings through its mutual funds (fonds communs de placement), and as of its last declarations held 2.99% of our share capital (declaration of November 5, 2010) and
2.88% of our voting rights (declaration of May 26, 2010).



BNP Paribas Asset Management declared that it had passed successively above and below the threshold of 1% of our share capital as a result of holdings through its mutual funds (fonds communs de
placement), and as of its last declaration held 0.98% of our share capital and 0.84% of our voting rights (declaration of April 27, 2010).



152



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##### Table of Contents

Crédit Agricole S.A declared that the Crédit Agricole group had passed above
the threshold of 1% of our share capital and as of its last declaration held 1.04% of our share capital and 0.89% of our voting rights (declaration of May 21, 2010).



Crédit Suisse declared that it had passed successively
above and below the thresholds of 1% and 3% of our share capital, and as of its last declaration held 1.24% of our share capital (declaration of December 16, 2010).



Dodge & Cox declared that it had passed above the
threshold of 3% of our share capital and as of its last declaration held 3.01% of our share capital and 2.59% of our voting rights (declaration of October 13, 2010).



Franklin Ressources declared that it had passed above the
threshold of 2% of our share capital, and as of its last declaration held 2.01% of our share capital and 1.72% of our voting rights (declaration of May 20, 2010).



LOréal, as a result of a share cancellation by
sanofi-aventis, declared that it had passively passed above the threshold of 9% of our share capital, and as of its last declaration held 9.02% of our share capital (declaration of May 12, 2010).



Natixis Asset Management declared that it had passed
successively above and below the threshold of 2% of our share capital, and as of its last declaration held 1.99% of our share capital (declaration of December 22, 2010).



Total declared that as a result of share sales it had
passed successively below the thresholds of 7% and 6% of our share capital (declaration of April 13, 2010) and the thresholds of 12%, 11% and 10% of our voting rights, and as of its last declaration held 5.88% of our share capital and 9.78% of
our voting rights (declaration of May 20, 2010).



Since January 1, 2011 we have been informed that the following share ownership declaration thresholds have been passed:



Amundi declared that as a result of share purchases it had
passed successively above and below the threshold of 3% of our share capital and as of its last declaration held 2.98% of our share capital (declaration of January 10, 2011).



Crédit Suisse declared that it had passed successively
above and below the threshold of 1% or our share capital and as a of its last declaration held 1.02% of our share capital (declaration of February 3, 2011)



Total declared that it had passed below the threshold of 9% of voting rights as a result of its share sales, and as of its last
declaration held 5.30% of our share capital and 8.97% of our voting rights (declaration of January 18, 2011).



Individual shareholders (including employees of sanofi-aventis and its subsidiaries, as well as retired employees holding shares via the
sanofi-aventis Group Employee Savings Plan) hold approximately 7% of our share capital. Institutional shareholders (excluding LOréal and Total) hold approximately 73% of our share capital. Such shareholders are primarily American
(26.1%), French (18.6%) and British (10.1%). German institutions hold 3.2% of our share capital, Swiss institutions hold 1.9%, institutions from other European countries hold 7.6% and Canadian institutions hold 1.1% of our share capital. Other
international institutional investors (excluding those from Europe and the United States) hold approximately 4.3% of our share capital. In France, our home country, we have 8,642 identified holders of record. In the United States, our host country,
we have 49 identified shareholders of record and 12,424 identified ADS holders of record.



(source: a survey conducted by Euroclear France as of December 31, 2010, and internal information).



Shareholders Agreement



We are unaware of any shareholders agreement currently
in force.



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B. Related Party Transactions



In the ordinary course of business, we purchase or provide
materials, supplies and services from or to numerous companies throughout the world. Members of our Board of Directors are affiliated with some of these companies. We conduct our transactions with such companies on an arms-length basis and do
not consider the amounts involved in such transactions to be material.



On September 17, 2009, sanofi-aventis acquired the interest held by Merck & Co., Inc. (Merck) in Merial Limited (Merial) and Merial is now a wholly-owned subsidiary of sanofi-aventis. As per
the terms of the agreement signed on July 29, 2009, sanofi-aventis also had an option, following the closing of the Merck/Schering-Plough merger, to combine the Intervet/Schering-Plough Animal Health business with Merial to form an animal
health joint venture that would be equally owned by the new Merck and sanofi-aventis. On March 8, 2010, sanofi-aventis did in fact exercise its contractual right to combine the Intervet/Schering-Plough Animal Health business with Merial. In
addition to execution of final agreements, formation of the new animal health joint venture remains subject to approval by the relevant competition authorities and other closing conditions (for more information see Notes D.1 and D.8.1 to our
consolidated financial statements included at Item 18 of this annual report).



On October 2, 2010, in order to fund a significant part of its proposed acquisition of Genzyme Corporation, sanofi-aventis executed a Facilities Agreement (the Facilities Agreement,
described at Item 10. Additional Information  C. Material Contracts herein) with J.P. Morgan plc, Société Générale Corporate & Investment Banking and BNP Paribas for unsecured term loan
facilities of up to US $15,000,000,000.



Because
Robert Castaigne serves on the boards of both Société Générale and sanofi-aventis, sanofi-aventis submitted the Facilities Agreement and certain non-material ancillary agreements, as well as a subsequent amendment, to the
prior approval of its Board of Directors with Robert Castaigne abstaining from the vote.



Other than these agreements, during 2010 and through the date of this annual report, we have not been involved in, and we do not currently anticipate becoming involved in, any transactions with related
parties that are material to us or to any of our related parties and that are unusual in their nature or conditions. We have not made any outstanding loans to or for the benefit of:



| |  |  | enterprises that, directly or indirectly, control or are controlled by, or are under common control with us;
| | - |  | ------------------------------------------------------------------------------------------------------------



| |  |  | enterprises or associates in which we have significant influence or that have significant influence over us;
| | - |  | ------------------------------------------------------------------------------------------------------------



| |  |  | shareholders beneficially owning a 10.0% or greater interest in our voting power;
| | - |  | ---------------------------------------------------------------------------------



| |  |  | any member of our Executive Committee or Board of Directors or close members of such individuals families; or
| | - |  | --------------------------------------------------------------------------------------------------------------



| |  |  | enterprises in which persons described above own, directly or indirectly, a substantial interest in the voting power or over which persons described
above are able to exert significant influence.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



C. Interests of Experts and Counsel



N/A



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##### Table of Contents

Item 8. Financial Information



A. Consolidated Financial
Statements and Other Financial Information



Our consolidated financial statements as of and for the years ended December 31, 2010, 2009, and 2008 are included at Item 18 of this
annual report.



Dividends on Ordinary Shares



We paid annual dividends for the years ended
December 31, 2005, 2006, 2007, 2008 and 2009 and our shareholders will be asked to approve the payment of an annual dividend of 2.50 per share for the 2010 fiscal year at our next annual shareholders meeting. If approved, this
dividend is scheduled to be paid on June 16, 2011.



We expect that we will continue to pay regular dividends based on our financial condition and results of operations. The proposed 2010
dividend equates to a distribution of 35.4% of our business earnings per share. For information on the non-GAAP financial measure, business earnings per share, see Item 5. Operating and Financial Review and Prospects 
Business Net Income.



The following table
sets forth information with respect to the dividends paid by our Company in respect of the 2006, 2007, 2008 and 2009 fiscal years and the dividend that will be proposed for approval by our shareholders in respect of the 2010 fiscal year at our
May 6, 2011 shareholders meeting.



|                                 |  |         |      |  |      |  |      |      |  |  |      |  |  |      |      |  |  |  |      | 
|-------------------------------- |  | ------- | ---- |  | ---- |  | ---- | ---- |  |  | ---- |  |  | ---- | ---- |  |  |  | ---- | 
|                                 |  | 2010(1) |      |  | 2009 |  |      | 2008 |  |  | 2007 |  |  | 2006 |     
|Net Dividend per Share (in )    |  |         | 2.50 |  |      |  | 2.40 |      |  |  | 2.20 |  |  |      | 2.07 |  |  |  | 1.75 | 
|Net Dividend per Share (in $)(2) |  |         | 3.34 |  |      |  | 3.46 |      |  |  | 3.06 |  |  |      | 3.02 |  |  |  | 2.31 | 



|(1) | Proposal, subject to shareholder approval.
|--- | ------------------------------------------

|(2) | Based on the relevant year-end exchange rate.
|--- | ---------------------------------------------



The declaration,
amount and payment of any future dividends will be determined by majority vote of the holders of our shares at an ordinary general meeting, following the recommendation of our Board of Directors. Any declaration will depend on our results of
operations, financial condition, cash requirements, future prospects and other factors deemed relevant by our shareholders. Accordingly, we cannot assure you that we will pay dividends in the future on a continuous and regular basis. Under French
law, we are required to pay dividends approved by an ordinary general meeting of shareholders within nine months following the meeting at which they are approved.



Annual Payments on Participating Share Series A (PSSA)



The table below sets forth, for the years
indicated, the amount of dividends paid per PSSA (see Item 9. The Offer and Listing for further detail). In the United States, the PSSAs exist in the form of American Depositary Shares issued by The Bank of New York Mellon, formerly
known as The Bank of New York, as depositary, each representing one-quarter of a PSSA (PSSA-ADSs). The PSSAs are generally entitled to receive an annual payment determined according to a specific formula and subject to certain
conditions.



The annual payments on the PSSAs are
equal to the sum of a fixed portion (1.14 per PPSA) and a variable portion equal to the greater of 704% of the dividend per ordinary share or 150% of an amount calculated pursuant to a formula which takes into account changes in consolidated
sales and consolidated net income.



Such amounts
have been translated in each case into dollars and adjusted for the one-to-four ratio of PSSAs to PSSA-ADSs. Annual payments paid to holders of PSSA-ADSs will generally be exempt from French withholding tax.



In 2010, the annual payment per PSSA in respect of 2009 was
equal to 18.0477.



|                            |  |      |         |  |      |   |         |      |  |   |         |  |  |      |         |  |  |   |         | 
|--------------------------- |  | ---- | ------- |  | ---- | - | ------- | ---- |  | - | ------- |  |  | ---- | ------- |  |  | - | ------- | 
|                            |  | 2009 |         |  | 2008 |   |         | 2007 |  |   | 2006    |  |  | 2005 |        
|Annual payment per PSSA     |  |     | 18.0477 |  |      |  | 16.6390 |      |  |  | 15.7234 |  |  |     | 13.4695 |  |  |  | 12.9929 | 
|Annual payment per PSSA-ADS |  | $    | 5.7708  |  |      | $ | 6.0204  |      |  | $ | 5.8550  |  |  | $    | 4.5877  |  |  | $ | 4.1438  | 



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##### Table of Contents

Information on Legal or Arbitration Proceedings



Our principal legal proceedings are described in Note D.22
to the consolidated financial statements included at Item 18 of this annual report, which we incorporate herein by reference, and are further updated below to reflect material developments through the date of this document.



We are also involved from time to time in a number of legal
proceedings incidental to the normal conduct of our business, including proceedings involving product liability claims, intellectual property rights (particularly claims by generic product manufacturers seeking to limit the patent protection of
sanofi-aventis products), compliance and trade practices, commercial claims, employment and wrongful discharge claims, tax assessment claims, waste disposal and pollution claims and claims under warranties or indemnification arrangements relating to
business divestitures.



 Eloxatin® (oxaliplatin) Patent Litigation



(Update to the caption Eloxatin® (oxaliplatin) Patent Litigation at Note D.22.b) to our consolidated financial statements included herein at
Item 18.)



On February 9, 2011, sanofi-aventis
and Sun Pharmaceuticals filed a stipulation before the U.S. District Court of New Jersey, whereby Sun Pharmaceuticals agreed not to launch a generic oxaliplatinbefore February 17, 2011. On February 14, 2011, the Court of Appeals for the
Federal Circuit issued a mandate, in connection with its December 2010 decision, transferring jurisdiction of the case to the U.S. District Court of New Jersey. On February 16, 2011, the U.S. District Court of New Jersey granted sanofi-aventis
request for a preliminary injunction, preventing Sun Pharmaceuticals from launching a generic oxaliplatin until the District Court resolves all issues pertaining to the settlement agreement, under which Sun Pharmaceuticals was obliged to desist from
selling its unauthorized generic oxaliplatin product in the U.S. from June 30, 2010 to August 9, 2012.



B. Significant Changes



In addition to the information included elsewhere in this
annual report, we bring to your attention the following developments since the end of 2010.



  Genzyme



On February 16, 2011, sanofi-aventis and its wholly owned subsidary, GC Merger Corp., signed an Agreement and Plan of Merger with Genzyme Corporation, pursuant to which, among other things, sanofi-aventis
and GC Merger Corp. agreed to amend their initial tender offer dated October 4, 2010 to reflect the terms of the Agreement and Plan of Merger and to increase the offered purchase price to (i) $74.00 in cash per share of Genzyme common stock,
and (ii) one contingent value right per share of Genzyme common stock to be issued by sanofi-aventis. The Agreement and Plan of Merger and the related CVR Agreement are described at Item 10.C. Material Contracts herein.



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##### Table of Contents

Item 9. The Offer and Listing



A. Offer and Listing
Details



We have one class of shares.
Each American Depositary Share, or ADS, represents one-half of one share. The ADSs are evidenced by American Depositary Receipts, or ADRs, which are issued by The Bank of New York.



Our shares trade on the Eurolist market of NYSE Euronext
Paris (Compartment A) and our ADSs trade on the New York Stock Exchange. There can be no assurances as to the establishment or continuity of a public market for our shares or ADSs.



Trading History



The table below sets forth, for the periods indicated, the
reported high and low quoted prices of our shares on the Eurolist market of NYSE Euronext Paris and on the New York Stock Exchange (source: Bloomberg).



|                                    |  |                        |       |  |     |  |                      |  |  |      |  |  |       |  |  |  |       | 
|----------------------------------- |  | ---------------------- | ----- |  | --- |  | -------------------- |  |  | ---- |  |  | ----- |  |  |  | ----- | 
|                                    |  | NYSE Euronext          |       |  |     |  | NYSE                 | 
|Calendar period                     |  | High                   |       |  | Low |  |                      |  |  | High |  |  | Low   | 
|                                    |  | (price per share in ) |       |  |     |  | (price per ADS in $) | 
|Monthly                             |  |                        |       |  |     |  |                      |  |  |      |  |  |       |  |  |  |       | 
|February 2011 (through February 25) |  |                        | 51.90 |  |     |  | 48.60                |  |  |      |  |  | 35.48 |  |  |  | 33.41 | 
|January 2011                        |  |                        | 52.23 |  |     |  | 48.11                |  |  |      |  |  | 35.42 |  |  |  | 31.45 | 
|December 2010                       |  |                        | 49.84 |  |     |  | 46.48                |  |  |      |  |  | 33.32 |  |  |  | 30.64 | 
|November 2010                       |  |                        | 51.41 |  |     |  | 46.23                |  |  |      |  |  | 36.31 |  |  |  | 30.05 | 
|October 2010                        |  |                        | 50.67 |  |     |  | 47.51                |  |  |      |  |  | 35.51 |  |  |  | 32.74 | 
|September 2010                      |  |                        | 50.90 |  |     |  | 45.13                |  |  |      |  |  | 34.10 |  |  |  | 29.55 | 
|August 2010                         |  |                        | 46.63 |  |     |  | 44.11                |  |  |      |  |  | 30.77 |  |  |  | 28.03 | 
|2010                                |  |                        |       |  |     |  |                      |  |  |      |  |  |       |  |  |  |       | 
|First quarter                       |  |                        | 58.90 |  |     |  | 51.68                |  |  |      |  |  | 41.59 |  |  |  | 34.90 | 
|Second quarter                      |  |                        | 55.85 |  |     |  | 45.21                |  |  |      |  |  | 37.72 |  |  |  | 28.01 | 
|Third quarter                       |  |                        | 50.90 |  |     |  | 44.01                |  |  |      |  |  | 34.10 |  |  |  | 28.03 | 
|Fourth quarter                      |  |                        | 51.41 |  |     |  | 46.23                |  |  |      |  |  | 36.31 |  |  |  | 30.05 | 
|Full Year                           |  |                        | 58.90 |  |     |  | 44.01                |  |  |      |  |  | 41.59 |  |  |  | 28.01 | 
|2009                                |  |                        |       |  |     |  |                      |  |  |      |  |  |       |  |  |  |       | 
|First quarter                       |  |                        | 49.93 |  |     |  | 38.43                |  |  |      |  |  | 32.80 |  |  |  | 24.59 | 
|Second quarter                      |  |                        | 48.67 |  |     |  | 39.32                |  |  |      |  |  | 33.83 |  |  |  | 25.57 | 
|Third quarter                       |  |                        | 51.68 |  |     |  | 40.91                |  |  |      |  |  | 38.00 |  |  |  | 28.60 | 
|Fourth quarter                      |  |                        | 56.78 |  |     |  | 48.35                |  |  |      |  |  | 40.80 |  |  |  | 35.83 | 
|Full Year                           |  |                        | 56.78 |  |     |  | 38.43                |  |  |      |  |  | 40.80 |  |  |  | 24.59 | 
|2008                                |  |                        |       |  |     |  |                      |  |  |      |  |  |       |  |  |  |       | 
|Full Year                           |  |                        | 66.90 |  |     |  | 36.055               |  |  |      |  |  | 49.04 |  |  |  | 23.95 | 
|2007                                |  |                        |       |  |     |  |                      |  |  |      |  |  |       |  |  |  |       | 
|Full Year                           |  |                        | 71.95 |  |     |  | 56.20                |  |  |      |  |  | 48.30 |  |  |  | 37.90 | 
|2006                                |  |                        |       |  |     |  |                      |  |  |      |  |  |       |  |  |  |       | 
|Full Year                           |  |                        | 79.85 |  |     |  | 64.85                |  |  |      |  |  | 50.05 |  |  |  | 41.65 | 



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B. Plan of Distribution



N/A



C. Markets



Shares and ADSs



Our shares are listed on the Euronext Paris Market
(Compartment A) under the symbol SAN and our ADSs are listed on the New York Stock Exchange, or NYSE, under the symbol SNY. At the date of this annual report, our shares are included in a large number of indices including the
CAC 40 Index, the principal French index published by Euronext Paris. This index contains 40 stocks selected among the top 100 companies based on free-float capitalization and the most active stocks listed on the Euronext Paris Market.
The CAC 40 Index indicates trends on the French stock market as a whole and is one of the most widely followed stock price indices in France. Our shares are also included in the S&P Global 100 Index, the Dow Jones EuroSTOXX 50, the Dow Jones
STOXX 50, the FTS Eurofirst 100, the FTS Eurofirst 80 and the MSCI Pan-Euro Index, among other indices.



The Euronext Paris Market



The Euronext Paris Market is a regulated market operated and managed by Euronext Paris, a market operator (entreprise de
marché) responsible for the admission of securities and the supervision of trading in listed securities on Euronext Paris. Euronext Paris publishes a daily official price list that includes price information on listed securities. The
Euronext Paris Market is divided into three capitalization compartments: A for issuers with a market capitalization over 1 billion, B for issuers with a market capitalization between 1 billion and
150 million, and C for issuers with a market capitalization under 150 million.



Trading on the Euronext Paris Market



Securities admitted to trading on the Euronext Paris Market are officially traded through authorized financial institutions that are
members of Euronext Paris. Euronext Paris places securities admitted to trading on the Euronext Paris Market in one of two categories (continuous (continu) or fixing), depending on whether they belong to certain indices or
compartments and/or on their historical and expected trading volume. Our shares trade in the category known as continu, which includes the most actively traded securities. Securities belonging to the continu category are traded on each
trading day from 9:00 a.m. to 5:30 p.m. (Paris time), with a pre-opening session from 7:15 a.m. to 9:00 a.m. and a post-closing session from 5:30 p.m. to 5:35 p.m. (during which pre-opening and post-closing sessions trades are recorded but not
executed until the opening auction at 9:00 a.m. and the closing auction at 5:35 p.m., respectively). In addition, from 5:35 p.m. to 5:40 p.m., trading can take place at the closing auction price. Trading in a share belonging to the continu
category after 5:40 p.m. until the beginning of the pre-opening session of the following trading day may take place at a price that must be within a range of plus or minus 1% of the closing auction price.



Euronext Paris may temporarily interrupt trading in a
security admitted to trading on the Euronext Paris Market if matching a bid or ask offer recorded in the system would inevitably result in a price beyond a certain threshold, determined on the basis of a percentage fluctuation above or below a set
reference price. With respect to equity securities included in the CAC 40 Index and trading in the continu category, once trading has commenced, volatility interruptions for a reservation period of 2 minutes (subject to extension by Euronext
Paris) are possible if the price fluctuates by more than 3% above or below the relevant reference price. Euronext Paris may also suspend trading of a security admitted to trading on the Euronext Paris Market in certain circumstances including at the
request of the issuer or the occurrence of unusual trading activity in a security. In addition, in exceptional cases, including, for example, upon announcement of a takeover bid, the French market regulator (Autorité des marchés
financiers or AMF) may also require Euronext Paris to suspend trading.



Trades of securities admitted to trading on the Euronext Paris Market are settled on a cash basis on the third trading day following the trade. For certain liquid securities, market intermediaries which
are members of Euronext Paris are also permitted to offer investors the opportunity to place orders through a deferred settlement service (Ordres Stipulés à Règlement-Livraison Différés  OSRD). The
deferred settlement service is only available for trades in securities that have both a total market capitalization of at least 1 billion and a daily



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average volume of trades of at least 1 million. Investors can elect on or before the determination date (jour de liquidation), which is the fourth trading day before the end of the
month, either to settle by the last trading day of the month or to postpone the settlement decision to the determination date of the following month. At the date of this annual report, our shares are currently eligible for the deferred settlement
service.



Equity securities traded on a deferred
settlement basis are considered to have been transferred only after they have been recorded in the purchasers account. Under French securities regulations, if the sale takes place before, but during the month of, a dividend payment date, the
purchasers account will be credited with an amount equal to the dividend paid.



Prior to any transfer of securities listed on the Euronext Paris Market held in registered form, the securities must be converted into bearer form and accordingly recorded in an account maintained by an
accredited intermediary with Euroclear France S.A., a registered central security depositary. Transactions in securities are initiated by the owner giving the instruction (through an agent, if appropriate) to the relevant accredited intermediary.
Trades of securities listed on the Euronext Paris Market are cleared through LCH.Clearnet and settled through Euroclear France S.A. using a continuous net settlement system. A fee or commission is payable to the accredited intermediary or other
agent involved in the transaction.



Participating Shares Series A



Further to a public offer to exchange ordinary shares for PSSAs in 1993, a tender offer to purchase for cash all of the outstanding
PSSA-ADSs in 1995 and repurchases in private transactions since that date, there are only 3,271 PSSAs outstanding as of December 31, 2010. In view of the small number of PSSAs that remain outstanding, at some time in the future, sanofi-aventis
intends to terminate the Deposit Agreement for the PSSA-ADSs and apply to the U.S. Securities and Exchange Commission to terminate registration of the PSSAs and the PSSA-ADSs under the Securities Exchange Act of 1934, as amended.



We are not aware of any non-U.S. trading market for our
Participating Shares Series A. In the United States, the PSSAs exist in the form of American Depositary Shares issued by The Bank of New York Mellon, formerly known as the Bank of New York, as depositary, each representing one-quarter of a PSSA. We
are not aware of any U.S. trading market for the PSSA-ADSs since their suspension from trading on the NYSE on May 18, 1995, and their subsequent removal from listing on the NYSE on July 31, 1995. Prior to their delisting, the PSSA-ADSs
traded on the NYSE under the symbol RP PrA.



Trading Practices and Trading in own Shares



Under French law, a company may not issue shares to itself,
but it may purchase its own shares in the limited cases described at Item 10. Additional Information  B. Memorandum and Articles of Association  Trading in Our Own Shares.



D. Selling Shareholders



N/A



E. Dilution



N/A



F. Expenses of the Issue



N/A



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##### Table of Contents

Item 10. Additional Information



A. Share Capital



N/A



B. Memorandum and Articles of Association



General



Our Company is a société anonyme, a form of limited liability company, organized under the
laws of France.



In this section, we summarize
material information concerning our share capital, together with material provisions of applicable French law and our statuts, an English translation of which has been filed as an exhibit to this annual report. For a description of certain
provisions of our statutsrelating to our Board of Directors and statutory auditors, see Item 6. Directors, Senior Management and Employees. You may obtain copies of our statutsin French from the greffe(Clerk) of
the Registre du Commerce et des Sociétés de Paris(Registry of Commerce and Companies of Paris, France, registration number: 395 030 844). Please refer to that full document for additional details.



Our statutsspecify that our corporate affairs are
governed by:



| |  |  | applicable laws and regulations (in particular, Title II of the French Commercial Code); and
| | - |  | --------------------------------------------------------------------------------------------



| |  |  | the statutsthemselves.
| | - |  | ----------------------



Article 3 of our statuts specifies that the Companys corporate objects, in France and abroad, are:



| |  |  | Acquiring interests and holdings, in any form whatsoever, in any company or enterprise, in existence or to be created, connected directly or indirectly
with the health and fine chemistry sectors, human and animal therapeutics, nutrition and bio-industry;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



in the following areas :



| |  |  | Purchase and sale of all raw materials and products necessary for these activities;
| | - |  | -----------------------------------------------------------------------------------



| |  |  | Research, study and development of new products, techniques and processes;
| | - |  | --------------------------------------------------------------------------



| |  |  | Manufacture and sale of all chemical, biological, dietary and hygienic products;
| | - |  | --------------------------------------------------------------------------------



| |  |  | Obtaining or acquiring all intellectual property rights related to results obtained and, in particular, filing all patents, trademarks and models,
processes or inventions;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Operating directly or indirectly, purchasing, and transferring  for free or for consideration  pledging or securing all intellectual
property rights, particularly all patents, trademarks and models, processes or inventions;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Obtaining, operating, holding and granting all licenses; and
| | - |  | ------------------------------------------------------------



| |  |  | Within the framework of a group-wide policy and subject to compliance with the relevant legislation, participating in treasury management transactions,
whether as lead company or otherwise, in the form of centralized currency risk management or intra-group netting, or any other form permitted under the relevant laws and regulations;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



And, more generally:



| |  |  | All commercial, industrial, real or personal property, financial or other transactions, connected directly or indirectly, totally or partially, with
the activities described above and with all similar or related activities or having any other purposes likely to encourage or develop the companys activities.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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Directors



Transactions in Which Directors Are Materially Interested



Under French law, any agreement entered into (directly or
through an intermediary) between our Company and any one of the members of the Board of Directors that is not entered into (i) in the ordinary course of our business and (ii) under normal conditions is subject to the prior authorization of
the disinterested members of the Board of Directors. The same provision applies to agreements between our Company and another company if one of the members of the Board of Directors is the owner, general partner, manager, director, general manager
or member of the executive or supervisory board of the other company, as well as to agreements in which one of the members of the Board of Directors has an indirect interest.



The Board of Directors must also authorize any undertaking
taken by our Company for the benefit of our Chairman, Chief Executive Officer (directeur général) or his delegates (directeurs généraux délégués) pursuant to which such persons will or
may be granted compensation, benefit or any other advantage as a result of the termination or change in their offices or following such termination or change.



In addition, such termination package, except any non-compete indemnity and certain pension benefits: (i) must be authorized by our
shareholders by adopting a separate general shareholders meeting resolution for each such beneficiary, which has to be renewed at each renewal of such beneficiarys mandate, and (ii) cannot be paid to such beneficiary unless (a) the Board
of Directors decides that such beneficiary has satisfied certain conditions, linked to such beneficiarys performances measured by our Companys performances, that must have been defined by the Board of Directors when granting such
package, and (b) such decision is publicly disclosed.



Directors Compensation



The aggregate amount of attendance fees (jetons de présence) of the Board of Directors is determined at the
Shareholders Ordinary General Meeting. The Board of Directors then divides this aggregate amount up among its members, by a simple majority vote. In addition, the Board of Directors may grant exceptional compensation
(rémunérations exceptionnelles) to individual directors on a case-by-case basis for special assignments following the procedures described above at  Transactions in Which Directors Are Materially Interested.
The Board may also authorize the reimbursement of travel and accommodation expenses, as well as other expenses incurred by Directors in the corporate interest. See also Item 6. Directors, Senior Management and Employees.



Board of Directors Borrowing Powers



All loans or borrowings on behalf of the
Company may be decided by the Board of Directors within the limits, if any, imposed by the Shareholders General Meeting.



Directors Age Limits



For a description of the provisions of our statutsrelating to age limits applicable to our Directors, see Item 6.
Directors, Senior Management and Employees.



Directors Share Ownership Requirements



Directors are required to hold at least 500 shares during
the term of their appointment.



Share Capital



As of December 31, 2010, our share capital amounted to
2,621,995,570, divided into 1,310,997,785 outstanding shares with a par value of 2 per share. All of our outstanding shares are of the same class and are fully paid. Of these shares, we or entities controlled by us held 6,070,712
shares (or 0.46% of our outstanding share capital), as treasury shares as of such date. As of December 31, 2010, the carrying amount of such shares was 371 million.



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At an extraordinary general meeting held on April 17, 2009, our shareholders authorized
our Board of Directors to increase our share capital, through the issuance of shares or other securities giving access to the share capital with or without preemptive rights, by an aggregate maximum nominal amount of 1.3 billion. See
 Changes in Share Capital  Increases in Share Capital, below.



The maximum total amount of authorized but unissued shares as of December 31, 2010 was 330.8 million, reflecting the unused part of the April 17, 2009 shareholder authorization, outstanding
options to subscribe for shares, and awards of shares.



Stock
Options



Types of Stock Options



We have two types of stock options outstanding: options to
subscribe for shares (options de souscription dactions) and options to purchase shares (options dachat dactions). Upon exercise of an option to subscribe for shares, we issue new shares, whereas upon exercise of an
option to purchase shares, the option holder receives existing shares. We purchase our shares on the market prior to the grant of the options to purchase in order to provide the option holder with shares upon exercise. Following the merger of
Aventis with and into sanofi-aventis, all previously granted options for the shares of Aventis were converted into options for our shares.



Because the exercise of options to purchase shares will be satisfied with existing shares repurchased on the market or held in treasury,
the exercise of options to purchase shares has no impact on our equity capital.



Stock Option Plans



Our combined general meeting of April 17, 2009 authorized our Board of Directors for 26 months to grant options to subscribe for shares and options to purchase shares to members of our salaried staff
and/or corporate officers as well as to members of salaried staff and/or corporate officers of companies or economic interest groups related to our Company under the conditions referred to in Article L. 225-180 of the French Commercial Code.



The aggregate number of options to subscribe for
shares and options to purchase shares that may be granted under this authorization may not give entitlement to a total number of shares exceeding 2.5% of the share capital as of the day the decision to grant options is made by the Board. Under such
a resolution, the price payable on the exercise of options may not be lower than the average of the first quoted prices of sanofi-aventis ordinary shares on the Euronext Paris Market during the 20 consecutive trading days preceding the date on which
the options are granted.



The authorization
entails the express waiver by the shareholders, in favor of the grantees of options to subscribe for shares, of their preemptive rights in respect of shares that are to be issued as and when options are exercised.



The Board of Directors sets the terms on which options are
granted and the arrangements as regards the dividend entitlement of the shares.



See Item 6. Directors, Senior Management and Employees  E. Share Ownership for a description of our option plans currently in force.



Awards of Shares



Our combined general meeting held on April 17, 2009
authorized our Board of Directors for 38 months to allot existing or new restricted shares to some or all salaried employees and corporate officers of the Company or of companies of the Group in accordance with Articles L. 225-197-1 et
seq of the French Commercial Code.



The
existing or new shares allotted under this authorization may not represent more than 1% of the share capital as of the date of the decision by the Board of Directors.



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The authorization provides that allotment of shares to the allottees will become irrevocable
either (i) at the end of a minimum vesting period of two years, the allottees being required to retain their shares for a minimum period of two years from the irrevocable allotment thereof, or (ii) after a minimum vesting period of four
years, in which case allottees may not be subject to any minimum retention period.



In the case of newly issued shares, the authorization entails the express waiver by the shareholders, in favor of the allottees of restricted shares, of their preemptive rights in respect of shares that
are to be issued as and when restricted shares are granted.



The Board of Directors sets the terms on which restricted shares are granted and the arrangements as regards the dividend entitlement of the shares.



See Item 6. Directors, Senior Management and Employees
 E. Share Ownership for a description of our restricted shares plans currently in force.



Changes in Share Capital in 2010



See Note D.15.1. to our consolidated financial statements included at Item 18 of this annual report.



Voting Rights



In general, each shareholder is entitled to one vote per share at any shareholders general meeting. However, our statutsprovide that any fully paid-up shares that have been held in registered form under the name of the same shareholder for at least two years acquire double voting rights. As of December 31, 2010, there were 209,996,274 shares that were
entitled to double voting rights, representing 16.02% of our total share capital, approximately 27.72% of our voting rights held by holders other than us and our subsidiaries, and 27.61% of our total voting rights.



Double voting rights are not taken into account in
determining whether a quorum exists.



Under the
French Commercial Code, shares of a company held in treasury or by entities controlled by that company are not entitled to voting rights and do not count for quorum purposes.



Our statuts allow us to obtain from Euroclear France
the name, nationality, address and number of shares held by holders of our securities that have, or may in the future have, voting rights. If we have reason to believe that a person on any list provided by Euroclear France holds securities on behalf
of another person, our statuts allow us to request information regarding beneficial ownership directly from such person. See  B. Memorandum and Articles of Association  Form, Holding and Transfer of Shares,
below.



Our statutsprovide that Board
members are elected on a rolling basis for a maximum tenure of four years. Our statuts do not provide for cumulative voting rights.



Shareholders Agreement



We are not aware of any shareholders agreement currently in force concerning our shares.



Shareholders Meetings



General



In accordance with the French Commercial Code, there are
three types of shareholders meetings: ordinary, extraordinary and special.



Ordinary general meetings of shareholders are required for matters such as:



| |  |  | electing, replacing and removing directors;
| | - |  | -------------------------------------------



| |  |  | appointing independent auditors;
| | - |  | --------------------------------



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| |  |  | approving the annual financial statements;
| | - |  | ------------------------------------------



| |  |  | declaring dividends or authorizing dividends to be paid in shares, provided the statutscontain a provision to that effect; and
| | - |  | ------------------------------------------------------------------------------------------------------------------------------



| |  |  | approving share repurchase programs.
| | - |  | ------------------------------------



Extraordinary general meetings of shareholders are required for approval of matters such as amendments to our statuts, including
any amendment required in connection with extraordinary corporate actions. Extraordinary corporate actions include:



| |  |  | changing our Companys name or corporate objects;
| | - |  | -------------------------------------------------



| |  |  | increasing or decreasing our share capital;
| | - |  | -------------------------------------------



| |  |  | creating a new class of equity securities;
| | - |  | ------------------------------------------



| |  |  | authorizing the issuance of securities giving access to our share capital or giving the right to receive debt instruments;
| | - |  | --------------------------------------------------------------------------------------------------------------------------



| |  |  | establishing any other rights to equity securities;
| | - |  | ---------------------------------------------------



| |  |  | selling or transferring substantially all of our assets; and
| | - |  | ------------------------------------------------------------



| |  |  | the voluntary liquidation of our Company.
| | - |  | -----------------------------------------



Special meetings of shareholders of a certain category of shares or shares with certain specific rights (such as shares with double voting
rights) are required for any modification of the rights derived from that category of shares. The resolutions of the shareholders general meeting affecting these rights are effective only after approval by the relevant special meeting.



Annual Ordinary Meetings



The French Commercial Code requires the Board of Directors
to convene an annual ordinary general meeting of shareholders for approval of the annual financial statements. This meeting must be held within six months of the end of each fiscal year. This period may be extended by an order of the President
of the Commercial Court. The Board of Directors may also convene an ordinary or extraordinary general meeting of shareholders upon proper notice at any time during the year. If the Board of Directors fails to convene a shareholders meeting,
our independent auditors may call the meeting. In case of bankruptcy, the liquidator or court-appointed agent may also call a shareholders meeting in some instances. In addition, any of the following may request the court to appoint an agent
for the purpose of calling a shareholders meeting:



| |  |  | one or several shareholders holding at least 5% of our share capital;
| | - |  | ---------------------------------------------------------------------



| |  |  | duly qualified associations of shareholders who have held their shares in registered form for at least two years and who together hold at least 1% of
our voting rights;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the works council in cases of urgency; or
| | - |  | -----------------------------------------



| |  |  | any interested party in cases of urgency.
| | - |  | -----------------------------------------



Notice of Shareholders Meetings



All prior notice periods provided for below are minimum periods required by French law and cannot be shortened, except in case of a public
offer for our shares.



We must announce general
meetings at least 35 days in advance by means of a preliminary notice (avis de réunion), which is published in the Bulletin des Annonces Légales Obligatoires, or BALO. The preliminary notice must first be sent to
the AMF. The AMF also recommends that, prior to or simultaneously with the publication of the preliminary notice, we publish a summary of the notice indicating the date, time and place of the meeting in a newspaper of national circulation in France
and on our website. In any event, the preliminary notice must be published on our website at least 21 days prior to the general meetings. The preliminary notice must contain,



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among other things, the agenda, a draft of the resolutions to be submitted to the shareholders and a detailed description of the voting procedures (proxy voting, electronic voting or voting by
mail) and the procedure permitting shareholders to submit additional resolutions or items.



At least 15 days prior to the date set for a first call, and at least ten days prior to any second call, we must send a final notice (avis de convocation) containing the final agenda, the date,
time and place of the meeting and other information related to the meeting. Such final notice must be sent by mail to all registered shareholders who have held shares in registered form for more than one month prior to the date of the final notice
and by registered mail, if shareholders have asked for it and paid the corresponding charges. The final notice must also be published in a newspaper authorized to publish legal announcements in the local administrative department
(département) in which our Company is registered as well as in the BALO, with prior notice having been given to the AMF for informational purposes. If no shareholder has proposed any new resolutions or items to be submitted to
the shareholders at the meeting and provided that the Board of Directors has not altered the draft resolutions included in the preliminary notice, we are not required to publish the final notice; publishing a preliminary notice that stipulates that
it shall be deemed to be equivalent to a final notice will be deemed sufficient.



In general, shareholders can only take action at shareholders meetings on matters listed on the agenda. As an exception to this rule, shareholders may take action with respect to the dismissal of
directors even though this action has not been included on the agenda. Additional resolutions to be submitted for approval by the shareholders at the meeting may be proposed to the Board of Directors, for recommendation to the shareholders as from
the publication of the preliminary notice in the BALO until 25 days prior to the general meeting and in any case no later than 20 days following the publication of the preliminary notice in the BALO:



| |  |  | one or several shareholders together holding a specified percentage of shares;
| | - |  | ------------------------------------------------------------------------------



| |  |  | a duly qualified association of shareholders who have held their shares in registered form for at least two years and who together hold at least 1% of
our voting rights; or
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the works council.
| | - |  | ------------------



Within the same period, the shareholders may also propose additional items to be submitted to the shareholders meeting. The
shareholders must substantiate the reasons for proposing their proposals of additional items.



The resolutions and the list of items added to the agenda of the shareholders meeting must be promptly published on our website.



The Board of Directors must submit the resolutions to a vote
of the shareholders after having made a recommendation thereon. The Board of Directors may also comment on the items that are submitted to the shareholders meeting.



Following the date on which documents must be made available
to the shareholders (including documents to be submitted to the shareholders meeting and resolutions proposed by the Board of Directors, which must be published on our website at least 21 days prior to the general meeting), shareholders may
submit written questions to the Board of Directors relating to the agenda for the meeting until the fourth business day prior to the general meeting. The Board of Directors must respond to these questions during the meeting or may refer to a Q&A
section located on our website in which the question submitted by a shareholder has already been answered.



Attendance at Shareholders Meetings; Proxies and Votes by Mail



In general, all shareholders may participate in general meetings either in person or by proxy. Shareholders may vote in person, by proxy
or by mail.



The right of shareholders to
participate in general meetings is subject to the recording (enregistrement comptable) of their shares on the third business day, zero hour (Paris time), preceding the general meeting:



| |  |  | for holders of registered shares: in the registered shareholder account held by the Company or on its behalf by an agent appointed by it; and
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------



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| |  |  | for holders of bearer shares: in the bearer shareholder account held by the accredited financial intermediary with whom such holders have deposited
their shares; such financial intermediaries shall deliver to holders of bearer shares a shareholding certificate (attestation de participation) enabling them to participate in the general meeting.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Attendance in Person



Any shareholder may attend ordinary general meetings and
extraordinary general meetings and exercise its voting rights subject to the conditions specified in the French Commercial Code and our statuts.



Proxies and Votes by Mail



Proxies are sent to any shareholder upon request received between the publication of the final notice of meeting and six days before the
general meeting and must be made available on our website at least 21 days before the general meeting. In order to be counted, such proxies must be received at our registered office, or at any other address indicated on the notice convening the
meeting, prior to the date of the meeting (in practice, we request that shareholders return proxies at least three business days prior to the meeting). A shareholder may grant proxies to any natural person or legal entity. The agent may be required
to disclose certain information to the shareholder or to the public.



Alternatively, the shareholder may send us a blank proxy without nominating any representative. In this case, the chairman of the meeting will vote the blank proxies in favor of all resolutions proposed
or approved by the Board of Directors and against all others.



With respect to votes by mail, we must send to shareholders a voting form upon request or must make available a voting form on our website at least 21 days before the general meeting. The completed form
must be returned to us at least three days prior to the date of the shareholders meeting. For holders of registered shares, in addition to traditional voting by mail, instructions may also be given via internet starting in 2011 through
procedures to be established.



Quorum



The French Commercial Code requires that shareholders
together holding at least 20% of the shares entitled to vote must be present in person, or vote by mail or by proxy, in order to fulfill the quorum requirement for:



| |  |  | an ordinary general meeting; and
| | - |  | --------------------------------



| |  |  | an extraordinary general meeting where the only resolutions pertain to either (a) a proposed increase in our share capital through incorporation
of reserves, profits or share premium, or (b) the potential issuance of free share warrants in the event of a public offer for our shares (article L. 233-32 of the French Commercial Code).
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



For any other extraordinary general meeting the quorum
requirement is at least 25% of the shares entitled to vote, held by shareholders present in person, voting by mail or by proxy.



For a special meeting of holders of a certain category of shares, the quorum requirement is one third of the shares entitled to vote in
that category, held by shareholders present in person, voting by mail or by proxy.



If a quorum is not present at a meeting, the meeting is adjourned. However, only questions that were on the agenda of the adjourned meeting may be discussed and voted upon.



When an adjourned meeting is resumed, there is no quorum
requirement for meetings cited in the first paragraph of this Quorum section. In the case of any other reconvened extraordinary general meeting or special meeting, the quorum requirement is 20% of the shares entitled to vote (or
voting shares belonging to the relevant category for special meetings of holders of shares of such specific category), held by shareholders present in person or voting by mail or by proxy. If a quorum is not present, the reconvened meeting may be
adjourned for a maximum of two months with the same quorum requirement. No deliberation or action by the shareholders may take place without a quorum.



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Votes Required for Shareholder Action



A simple majority of shareholders may pass a resolution at either an ordinary general meeting or an
extraordinary general meeting where the only resolution(s) pertain to either (a) a proposed increase in our share capital through incorporation of reserves, profits or share premium, or (b) the potential issuance of free share warrants in
the event of a public offer for our shares (article L. 233-32 of the French Commercial Code). At any other extraordinary general shareholders meeting and at any special meeting of holders of a specific category of shares, a two-thirds majority
of the votes cast is required.



Abstention from
voting by those present or those represented by proxy or voting by mail is counted as a vote against the resolution submitted to a shareholder vote.



Changes to Shareholders Rights



Under French law, a two-thirds majority vote at the extraordinary shareholders meeting is required to change our statuts,
which set out the rights attached to our shares, except for capital increases through incorporation of reserves, profits or share premium, or through the issuance of free share warrants in the event of a public offer for our shares (article L.
233-32 of the French Commercial Code).



The rights
of a class of shareholders can be amended only after a special meeting of the class of shareholders affected has taken place. The voting requirements applicable to this type of special meeting are the same as those applicable to an extraordinary
general shareholders meeting. The quorum requirements for a special meeting are one-third of the voting shares, or 20% upon resumption of an adjourned meeting.



A unanimous shareholders vote is required to increase
the liabilities of shareholders.



Financial Statements and
Other Communications with Shareholders



In
connection with any shareholders meeting, we must provide a set of documents including our annual report and a summary of the financial results of the five previous fiscal years to any shareholder who so requests.



We must also provide on our website at least 21 days before a
shareholders meeting certain information and a set of documents including the preliminary notice, the proxies and voting forms, the resolutions proposed by the Board of Directors, the documents to be submitted to the shareholders meeting
pursuant to article L.225-15 and R.225-83 of the French Commercial Code, etc. The resolutions and the list of items added to the agenda of the shareholders meeting must be promptly published on our website.



Dividends



We may only distribute dividends out of our distributable profits, plus any amounts held in our
reserves that the shareholders decide to make available for distribution, other than those reserves that are specifically required by law or our statuts. Distributable profits consist of our unconsolidated net profit in each
fiscal year, as increased or reduced by any profit or loss carried forward from prior years, less any contributions to the reserve accounts pursuant to law or our statuts.



Legal Reserve



The French Commercial Code requires us to allocate 5% of our
unconsolidated net profit for each year to our legal reserve fund before dividends may be paid with respect to that year. Funds must be allocated until the amount in the legal reserve is equal to 10% of the aggregate par value of the issued and
outstanding share capital. This restriction on the payment of dividends also applies to each of our French subsidiaries on an unconsolidated basis. At December 31, 2010, our legal reserve amounted to 282,280,863, representing 10.7% of the
aggregate par value of our issued and outstanding share capital as of that date. The legal reserve of any company subject to this requirement may serve to allocate losses that may not be allocated to other reserves or may be distributed to
shareholders upon liquidation of the company.



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Approval of Dividends



According to the French Commercial Code, our Board of
Directors may propose a dividend for approval by the annual general meeting of shareholders. If we have earned distributable profits since the end of the preceding fiscal year, as reflected in an interim income statement certified by our independent
auditors, our Board of Directors may distribute interim dividends to the extent of the distributable profits for the period covered by the interim income statement. Our Board of Directors exercises this authority subject to French law and
regulations and may do so without obtaining shareholder approval.



Distribution of Dividends



Dividends are distributed to shareholders pro rata according to their respective holdings of shares. In the case of interim
dividends, distributions are made to shareholders on the date set by our Board of Directors during the meeting in which the distribution of interim dividends is approved. The actual dividend payment date is decided by the shareholders at an ordinary
general shareholders meeting or by our Board of Directors in the absence of such a decision by the shareholders. Shareholders that own shares on the actual payment date are entitled to the dividend.



Dividends may be paid in cash or, if the shareholders
meeting so decides, in kind, provided that all shareholders receive a whole number of assets of the same nature paid in lieu of cash. Our statutsprovide that, subject to a decision of the shareholders meeting taken by ordinary
resolution, each shareholder may be given the choice to receive his dividend in cash or in shares.



Timing of Payment



According to the French Commercial Code, we must pay any existing dividends within nine months of the end of our fiscal year, unless otherwise authorized by court order. Dividends on shares that are not
claimed within five years of the date of declared payment revert to the French State.



Changes in Share Capital



Increases in Share Capital



As provided for by the French Commercial Code, our share capital may be increased only with the shareholders approval at an extraordinary general shareholders meeting following the
recommendation of our Board of Directors. Increases in our share capital may be effected by:



| |  |  | issuing additional shares;
| | - |  | --------------------------



| |  |  | increasing the par value of existing shares;
| | - |  | --------------------------------------------



| |  |  | creating a new class of equity securities; or
| | - |  | ---------------------------------------------



| |  |  | exercising the rights attached to securities giving access to the share capital.
| | - |  | --------------------------------------------------------------------------------



Increases in share capital by issuing additional securities
may be effected through one or a combination of the following:



| |  |  | in consideration for cash;
| | - |  | --------------------------



| |  |  | in consideration for assets contributed in kind;
| | - |  | ------------------------------------------------



| |  |  | through an exchange offer;
| | - |  | --------------------------



| |  |  | by conversion of previously issued debt instruments;
| | - |  | ----------------------------------------------------



| |  |  | by capitalization of profits, reserves or share premium; or
| | - |  | -----------------------------------------------------------



| |  |  | subject to various conditions, in satisfaction of debt incurred by our Company.
| | - |  | -------------------------------------------------------------------------------



Decisions to increase the share capital through the
capitalization of reserves, profits and/or share premium or through the issuance of free share warrants in the event of a public offer for our shares (article L. 233-32 of the



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French Commercial Code) require the approval of an extraordinary general shareholders meeting, acting under the quorum and majority requirements applicable to ordinary shareholders
meetings. Increases effected by an increase in the par value of shares require unanimous approval of the shareholders, unless effected by capitalization of reserves, profits or share premium. All other capital increases require the approval of an
extraordinary general shareholders meeting acting under the regular quorum and majority requirements for such meetings. See  Quorum and  Votes Required for Shareholder Action above.



Since the entry into force of order 2004-604 of June 24,
2004, the shareholders may delegate to our Board of Directors either the authority (délégation de compétence) or the power (délégation de pouvoir) to carry out any increase in share capital. Our Board
of Directors may further delegate this power to our Chief Executive Officer or, subject to our Chief Executive Officers approval, to his delegates (directeurs généraux délégués).



On April 17, 2009, our shareholders approved various
resolutions delegating to the Board of Directors the authority to increase our share capital through the issuance of shares or securities giving access to the share capital, subject to an overall cap set at 1.3 billion. This cap applies to all
the resolutions whereby the extraordinary shareholders meeting delegated to the Board of Directors the authority to increase the share capital, it being also specified that:



| |  | the maximum aggregate par value of capital increases that may be carried out with preemptive rights maintained was set at 1.3 billion;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------



| |  | the maximum aggregate par value of capital increases that may be carried out without preemptive rights was set at 500 million;
| | - | -------------------------------------------------------------------------------------------------------------------------------



| |  | the maximum aggregate par value of capital increases that may be carried out by capitalization of share premium, reserves, profits or other items was set at 500
million; and
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | capital increases resulting in the issuance of securities to employees, early retirees or retirees under our employee savings plans are limited to 2% of the share
capital as computed on the date of the Boards decision, and such issuances may be made at a discount of 20% (or 30% if certain French law restrictions on resales were to apply).
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



On April 17, 2009, our shareholders also approved
resolutions delegating to the Board of Directors the authority to increase the share capital by granting options or free shares to our employees and/or corporate officers, subject to the overall cap mentioned above and under the following terms and
conditions:



| |  | the authorization, for a period of 26 months, to grant options to purchase or to subscribe for our shares to employees and/or corporate officers; such options may not
give entitlement to a total number of shares exceeding 2.5% of the share capital as computed on the day of the Boards decision; see  Stock Options above;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | the authorization, for a period of 38 months, to grant existing or new shares free of consideration to employees and/or corporate officers, up to a limit of 1% of the
share capital as computed on the day of the Boards decision; see  Awards of Shares above.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



See also Item 6. Directors, Senior Management and Employees  E. Share Ownership.



Decreases in Share Capital



According to the French Commercial Code, any decrease in our
share capital requires approval by the shareholders entitled to vote at an extraordinary general meeting. The share capital may be reduced either by decreasing the par value of the outstanding shares or by reducing the number of outstanding shares.
The number of outstanding shares may be reduced either by an exchange of shares or by the repurchase and cancellation of shares. Holders of each class of shares must be treated equally unless each affected shareholder agrees otherwise.



In addition, specific rules exist to permit the cancellation
of treasury shares, by which the shareholders meeting may authorize the cancellation of up to 10% of a companys share capital per 24-month period. On April 17, 2009, our shareholders delegated to our Board of Directors for 26 months
the right to reduce our share capital by canceling our own shares.



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Preemptive Rights



According to the French Commercial Code, if we issue
additional securities to be paid in cash, current shareholders will have preemptive rights to these securities on a pro rata basis. These preemptive rights require us to give priority treatment to current shareholders. The rights entitle the
individual or entity that holds them to subscribe to the issuance of any securities that may increase the share capital of our Company by means of a cash payment or a set-off of cash debts. Preemptive rights are transferable during the subscription
period relating to a particular offering. These rights may also be listed on Euronext Paris Stock Exchange.



Preemptive rights with respect to any particular offering may be waived by a vote of shareholders holding a two-thirds majority of the
shares entitled to vote at an extraordinary general meeting. Our Board of Directors and our independent auditors are required by French law to present reports that specifically address any proposal to waive preemptive rights. In the event of a
waiver, the issue of securities must be completed within the period prescribed by law. Shareholders also may notify us that they wish to waive their own preemptive rights with respect to any particular offering if they so choose.



The shareholders may decide at extraordinary general meetings
to give the existing shareholders a non-transferable priority right to subscribe to the new securities, for a limited period of time.



In the event of a capital increase without preemptive rights to existing shareholders, French law requires that the capital increase be
made at a price equal to or exceeding the weighted average market prices of the shares for the last three trading days on Euronext Paris Stock Exchange prior to the determination of the subscription price of the capital increase less 5%.



Form, Holding and Transfer of Shares



Form of Shares



Our statutsprovide that the shares may be held in
either bearer form or registered form at the option of the holder.



Holding of Shares



In accordance with French law relating to the dematerialization of securities, shareholders ownership rights are represented by book
entries instead of share certificates. We maintain a share account with Euroclear France (a French clearing system, which holds securities for its participants) for all shares in registered form, which is administered by BNP Paribas Securities
Services. In addition, we maintain separate accounts in the name of each shareholder either directly or, at a shareholders request, through the shareholders accredited intermediary. Each shareholder account shows the name of the holder
and the number of shares held. BNP Paribas Securities Services issues confirmations (attestations dinscription en compte) to each registered shareholder as to shares registered in the shareholders account, but these confirmations
are not documents of title.



Shares of a listed
company may also be issued in bearer form. Shares held in bearer form are held and registered on the shareholders behalf in an account maintained by an accredited financial intermediary and are credited to an account at Euroclear France
maintained by such intermediary. Each accredited financial intermediary maintains a record of shares held through it and provides the account holder with a securities account statement. Transfers of shares held in bearer form may only be made
through accredited financial intermediaries and Euroclear France.



Shares held by persons who are not domiciled in France may be registered in the name of intermediaries who act on behalf of one or more investors. When shares are so held, we are entitled to request from
such intermediaries the names of the investors. Also, we may request any legal entity (personne morale) which holds more than 2.5% of our shares or voting rights, to disclose the name of any person who owns, directly or indirectly, more than
one-third of its share capital or of its voting rights. A person not providing the complete requested information in time, or who provides incomplete or false information, will be deprived of its voting rights at shareholders meetings and will
have its payment of dividends withheld until it has provided the requested information in strict compliance with French law. If such person acted willfully, the person may be deprived by a French court of either its voting rights or its dividends or
both for a period of up to five years.



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Transfer of Shares



Our statutsdo not contain any restrictions relating
to the transfer of shares.



Registered shares must
be converted into bearer form before being transferred on the Euronext Paris Market on the shareholders behalf and, accordingly, must be registered in an account maintained by an accredited financial intermediary on the shareholders
behalf. A shareholder may initiate a transfer by giving instructions to the relevant accredited financial intermediary. A fee or commission is payable to the broker involved in the transaction, regardless of whether the transaction occurs within or
outside France. No registration duty is normally payable in France unless a transfer instrument has been executed in France.



Redemption of Shares



Under French law, our Board of Directors is entitled to redeem a set number of shares as authorized by the extraordinary
shareholders meeting. In the case of such an authorization, the shares redeemed must be cancelled within one month after the end of the offer to purchase such shares from shareholders. However, shares redeemed on the open market do not need to
be cancelled if the company redeeming the shares grants options on or awards those shares to its employees within one year following the acquisition. See also  Trading in Our Own Shares below.



Sinking Fund Provisions.



Our statuts do not provide for any sinking fund
provisions.



Liability to Further Capital Calls



Shareholders are liable for corporate liabilities only up to
the par value of the shares they hold; they are not liable to further capital calls.



Liquidation Rights



If we are liquidated, any assets remaining after payment of our debts, liquidation expenses and all of our remaining obligations will first be distributed to repay in full the par value of our shares. Any
surplus will be distributed pro rataamong shareholders in proportion to the par value of their shareholdings.



Requirements for Holdings Exceeding Certain Percentages



The French Commercial Code provides that any individual or entity, acting alone or in concert with others, that
becomes the owner, directly or indirectly, of more than 5%, 10%, 15%, 20%, 25%, 331/3%, 50%, 662/3%, 90% or 95% of the outstanding shares or voting rights of a listed company in France, such as our Company, or that increases or decreases its shareholding or voting rights above or below any of those
percentages, must notify the company, before the end of the fourth trading day following the date it crosses the threshold, of the number of shares it holds and their voting rights. The individual or entity must also notify the AMF before the end of
the fourth trading day following the date it crosses the threshold. The AMF makes the notice public.



The AMF also requires disclosure of certain information relating to other financial instruments (e.g., convertible or exchangeable
securities, warrants, equity swaps, etc.) that could increase the shareholding of the individual or entity.



Subject to certain limited exceptions, French law and AMF regulations impose additional reporting requirements on persons who acquire more
than 10%, 15%, 20% or 25% of the outstanding shares or voting rights of a listed company in France. These persons must file a report with the company and the AMF before the end of the fifth trading day following the date they cross the threshold.



In the report, the acquirer will have to specify
its intentions for the following six months including:



| | - | whether it acts alone or in concert with others;
| | - | ------------------------------------------------



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| | - | the means of financing of the acquisition (the notifier shall indicate in particular whether the acquisition is being financed with equity or debt, the main features of
that debt, and, where applicable, the main guarantees given or received by the notifier. The notifier shall also indicate what portion of its holding, if any, it obtained through securities loans);
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | - | whether or not it intends to continue its purchases;
| | - | ----------------------------------------------------



| | - | whether or not it intends to acquire control of the company in question;
| | - | ------------------------------------------------------------------------



| | - | the strategy it contemplates vis-à-vis the issuer;
| | - | --------------------------------------------------



| | - | the way it intends to implement it: (i) any plans for a merger, reorganization, liquidation, or partial transfer of a substantial part of the assets of the issuer
or of any other entity it controls within the meaning of Article L. 233-3 of the French Commercial Code, (ii) any plans to modify the business of the issuer, (iii) any plans to modify the memorandum and articles of association of the
issuer, (iv) any plans to delist a category of the issuers financial instruments, and (v) any plans to issue the issuers financial instruments;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | - | any agreement for the temporary transfer of shares or voting rights; and
| | - | ------------------------------------------------------------------------



| | - | whether it seeks representation on the Board of Directors.
| | - | ----------------------------------------------------------



The AMF makes the report public. Upon any change of intention within the six-month period following the filing of the report, it will have
to file a new report for the following six-month period.



In order to enable shareholders to give the required notice, we must each month publish on our website and send the AMF a written notice setting forth the total number of our shares and voting rights
(including treasury shares) whenever they vary from the figures previously published.



If any shareholder fails to comply with an applicable legal notification requirement, the shares in excess of the relevant threshold will be deprived of voting rights for all shareholders meetings
until the end of a two-year period following the date on which the owner complies with the notification requirements. In addition, any shareholder who fails to comply with these requirements may have all or part of its voting rights suspended for up
to five years by the Commercial Court at the request of our Chairman, any shareholder or the AMF, and may be subject to criminal fines.



Under AMF regulations, and subject to limited exemptions granted by the AMF, any person or entity, acting alone or in
concert, that crosses the threshold of 331/3% of the
share capital or voting rights of a French listed company must initiate a public tender offer for the balance of the shares and securities giving access to the share capital or voting rights of such company.



In addition, our statutsprovide that any person or
entity, acting alone or in concert with others, who becomes the owner of 1%, or any multiple of 1% of our share capital or our voting rights must notify us by certified mail, return receipt requested, within five trading days, of the total number of
shares and securities giving access to our share capital and voting rights that such person then owns. The same provisions of our statutsapply whenever such owner increases or decreases its ownership of our share capital or our voting rights
to such extent that it goes above or below one of the thresholds described in the preceding sentence. Any person or entity that fails to comply with such notification requirement, will, upon the request of one or more shareholders holding at least
5% of our share capital or of our voting rights made at the general shareholders meeting, be deprived of voting rights with respect to the shares in excess of the relevant threshold for all shareholders meetings until the end of a
two-year period following the date on which such person or entity complies with the notification requirements.



Change in Control/Anti-takeover



There are no provisions in our statuts that would have the effect of delaying, deferring or preventing a change in control of our Company or that would operate only with respect to a merger,
acquisition or corporate



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restructuring involving our Company or any of our subsidiaries. Further, there are no provisions in our statutsthat allow the issuance of preferred stock upon the occurrence of a takeover
attempt or the addition of other anti-takeover measures without a shareholder vote.



Our statuts do not include any provisions discriminating against any existing or prospective holder of our securities as a result of such shareholder owning a substantial number of shares.



Trading in Our Own Shares



Under French law, sanofi-aventis may not issue shares to
itself. However, we may, either directly or through a financial intermediary acting on our behalf, acquire up to 10% of our issued share capital within a maximum period of 18 months, provided our shares are listed on a regulated market. Prior to
acquiring our shares, we must publish a description of the share repurchase program (descriptif du programme de rachat dactions).



We may not cancel more than 10% of our issued share capital over any 24-month period. Our repurchase of shares must not result in our
Company holding, directly or through a person acting on our behalf, more than 10% of our issued share capital. We must hold any shares that we repurchase in registered form. These shares must be fully paid up. Shares repurchased by us continue to be
deemed issued under French law but are not entitled to dividends or voting rights so long as we hold them directly or indirectly, and we may not exercise the preemptive rights attached to them.



The shareholders, at an extraordinary general shareholders
meeting, may decide not to take these shares into account in determining the preemptive rights attached to the other shares. However, if the shareholders decide to take them into account, we must either sell the rights attached to the shares we hold
on the market before the end of the subscription period or distribute them to the other shareholders on a pro rata basis.



On May 17, 2010, our shareholders approved a resolution authorizing us to repurchase up to 10% of our shares over an 18-month period.
Under this authorization, the purchase price for each sanofi-aventis ordinary share may not be greater than 80.00 and the maximum amount that sanofi-aventis may pay for the repurchases is 10,547,832,400. This authorization was granted
for a period of 18 months from May 17, 2010 and cancelled and replaced the authorization granted to the Board of Directors by the general meeting held on April 17, 2009. A description of this share repurchase program as adopted by the
Board of Directors on May 17, 2010, (descriptif duprogramme de rachat dactions) was published on March, 12, 2010.



Purposes of Share Repurchase Programs



European regulation 2273/2003, dated December 22, 2003
(which we refer to in this section as the Regulation), in application of European directive 2003/6/EC, dated January 28, 2003, known as the Market Abuse Directive (the Directive) relating to share repurchase
programs and the stabilization of financial instruments, came into effect on October 13, 2004.



The entry into force of the Regulation has resulted in changes in the manner in which share repurchase programs are implemented. Under the Regulation, an issuer will benefit from a safe harbor for share
transactions that comply with certain conditions relating in particular to the pricing, volume and timing of transactions (see below) and that are made in connection with a share repurchase program the purpose of which is:



| |  |  | to reduce the share capital through the cancellation of treasury shares; and/or
| | - |  | -------------------------------------------------------------------------------



| |  |  | to meet obligations arising from debt instruments exchangeable into equity instruments and/or the implementation of employee share option programs or
other employee share allocation plans.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Safe harbor transactions will by definition not be considered market abuses under the Regulation. Transactions that are carried out for other purposes than those mentioned above do not qualify for the
safe harbor. However, as permitted by the Directive, which provides for the continuation of existing practices that do not constitute market manipulation and that conform with certain criteria set forth in European directive 2004/72, dated
April 29, 2004, the AMF published exceptions on March 22, 2005 to permit the following existing market practices:



| |  |  | transactions pursuant to a liquidity agreement entered into with a financial services intermediary that complies with the ethical code (charte de
déontologie) approved by the AMF; and
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| |  |  | the purchase of shares that are subsequently used as acquisition currency in a business combination transaction.
| | - |  | ----------------------------------------------------------------------------------------------------------------



The AMF confirmed that all transactions directed at
maintaining the liquidity of an issuers shares must be conducted pursuant to a liquidity agreement with a financial services intermediary acting independently.



Additionally, our program could be used for any purpose that
is authorized or could be authorized under applicable laws and regulations.



Pricing, Volume and Other Restrictions



In order to qualify for the safe harbor, the issuer must generally comply with the following pricing and volume restrictions:



| |  |  | a share purchase must not be made at a price higher than the higher of the price of the last independent trade and the highest current independent bid
on the trading venues where the purchase is carried out;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | subject to certain exceptions for illiquid securities, the issuer must not purchase more than 25% of the average daily volume of the shares in any one
day on the regulated market on which the purchase is carried out. The average daily volume figure must be based on the average daily volume traded in the month preceding the month of public disclosure of the share repurchase program and fixed on
that basis for the authorized period of that program. If the program does not make reference to this volume, the average daily volume figure must be based on the average daily volume traded in the 20 trading days preceding the date of purchase.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In addition, an issuer must
not:



| |  |  | sell treasury shares during the period of the repurchase program (without prejudice to the right of the issuer to meet its obligations under employee
share option programs or other employee share allocation plans or to use shares as acquisition currency as mentioned above); it being further specified that such prohibition is not applicable in the event of off-market block trades or if the share
repurchase program is implemented by a financial services intermediary pursuant to a liquidity agreement as mentioned above; and
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | effect any transaction during a blackout period imposed by the applicable law of the Member State in which the transaction occurs
(i.e., under French law, during the period between the date on which the company has knowledge of insider information and the date on which such information is made public and during the 30-day period preceding the date of publication of
annual and half-year financial statements or the 15-day period preceding the date of publication of quarterly financial information), without prejudice to transactions carried out pursuant to a liquidity agreement as mentioned above; or
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | effect any transaction in securities with respect to which the issuer has decided to defer disclosure of any material, non-public information.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------



Use of Share Repurchase Programs



Pursuant to the AMF rules, issuers must
immediately allocate the repurchased shares to one of the purposes provided for in the Regulation and must not subsequently use the shares for a different purpose. As an exception to the foregoing, shares repurchased with a view to covering stock
option plans may, if no longer needed for this purpose, be re-allocated for cancellation or sold in compliance with AMF requirements relating in particular to blackout periods. Shares repurchased in connection with one of the market practices
authorized by the AMF (see above) may also be re-allocated to one of the purposes contemplated by the Regulation or sold in compliance with AMF requirements. Shares repurchased with a view to their cancellation must be cancelled within 24 months
following their acquisition.



During the year
ended December 31, 2010, we used the authority delegated by our shareholders to repurchase our shares on the stock market.



Pursuant to our share repurchase program authorized by our shareholders in April 2009, we repurchased 3,900,000 of our shares for a
weighted average price of 53.85 in February 2010 and 2,100,000 of our shares for a weighted average price of 56.02 in March 2010.



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On April 28, 2010, the Board of Directors cancelled 7,911,300 treasury shares, as
follows:



| |  |  | 7,821,500 shares repurchased up to March 31, 2010 pursuant to the share repurchase programs of the Company, including:
| | - |  | ----------------------------------------------------------------------------------------------------------------------



| |  |  | 1,011,500 shares repurchased in May 2008;
| | - |  | -----------------------------------------



| |  |  | 810,000 shares repurchased in June and August 2008;
| | - |  | ---------------------------------------------------



| |  |  | 5,871,026 shares repurchased on the market in February and March 2010; and
| | - |  | --------------------------------------------------------------------------



| |  |  | 128,974 shares repurchased from Hoechst GmbH in March 2010 (following the expiration of its last stock option plan);
| | - |  | --------------------------------------------------------------------------------------------------------------------



| |  |  | 89,800 shares previously allocated to expired stock option programs, which had been reallocated to the purpose of reducing the share capital.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------



In 2010, we also
implemented the share repurchase program authorized by our shareholders in May 2010 with the sole aim of supporting the liquidity of the shares through a liquidity contract entered into with an investment service provider in compliance with the
ethical code (charte de déontologie) approved by the AMF.We entered into this liquidity contract with Exane BNP Paribas on September 16, 2010.



Upon implementation of this contract, we allocated
40,000,000, of which 20,000,000 was initially made available, to the liquidity account. During 2010, Exane BNP Paribas purchased, between November 1, 2010 and December 31, 2010, 750,296 of our shares at an average weighted
price of 48.48 and sold 735,296 of our shares at an average weighted price of 48.55.



In 2010, of the 7,601,216 shares allocated to stock purchase option plans outstanding at December 31, 2009, 1,326,730 shares were transferred to grantees of options,



As a result, as of December 31, 2010, treasury shares
were allocated as follows :



| |  |  | 5,851,776 shares, representing 0.446% of our share capital, were allocated to outstanding stock purchase option plans;
| | - |  | ----------------------------------------------------------------------------------------------------------------------



| |  |  | 203,936 directly-owned shares, representing 0.015% of our share capital, were allocated to cancellation; and
| | - |  | ------------------------------------------------------------------------------------------------------------



| |  |  | 15,000 directly-owned shares, representing 0.001% of our share capital, were allocated to the liquidity account.
| | - |  | ----------------------------------------------------------------------------------------------------------------



As of December 31, 2010, we directly owned 6,070,712
sanofi-aventis shares with a par value of 2 representing around 0.46% of our share capital and with an estimated value of 379,248,041, based on the share price at the time of purchase.



Reporting Obligations



Pursuant to the AMF Regulation and the French Commercial
Code, issuers trading in their own shares are subject to the following reporting obligations:



| |  |  | issuers must report all transactions in their own shares on their web site within seven trading days of the transaction in a prescribed format, unless
such transactions are carried out pursuant to a liquidity agreement that complies with the ethical code approved by the AMF; and
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | issuers must declare to the AMF on a monthly basis all transactions completed under the share repurchase program unless they provide the same
information on a weekly basis.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Ownership of
Shares by Non-French Persons



The French
Commercial Code and our statuts currently do not limit the right of non-residents of France or non-French persons to own or, where applicable, to vote our securities. However, non-residents of France must



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file an administrative notice with the French authorities in connection with the acquisition of a controlling interest in our Company. Under existing administrative rulings, ownership of 331/3% or more of our share capital or voting rights is
regarded as a controlling interest, but a lower percentage might be held to be a controlling interest in certain circumstances depending upon factors such as:



| |  |  | the acquiring partys intentions;
| | - |  | ---------------------------------



| |  |  | the acquiring partys ability to elect directors; or
| | - |  | ----------------------------------------------------



| |  |  | financial reliance by the company on the acquiring party.
| | - |  | ---------------------------------------------------------



Enforceability of Civil Liabilities



We are a limited liability company (société
anonyme) organized under the laws of France, and most of our directors and officers reside outside the United States. In addition, a substantial portion of our assets is located in France. As a result, it may be difficult for investors to effect
service of process within the United States on such persons. It may also be difficult to enforce against them, either inside or outside the United States, judgments obtained against them in U.S. courts, or to enforce in U.S. courts, judgments
obtained against them in courts in jurisdictions outside the United States, in any action based on civil liabilities under the U.S. federal securities laws. There is doubt as to the enforceability against such persons in France, whether in original
actions or in actions to enforce judgments of U.S. courts, of liabilities based solely on the U.S. federal securities laws. Actions for enforcement of foreign judgments against such persons would require such persons who are of French nationality to
waive their right under Article 15 of the French Civil Code to be sued only in France. We believe that no such French persons have waived such right with respect to actions predicated solely upon U.S. federal securities laws. In addition, actions in
the United States under the U.S. federal securities laws could be affected under certain circumstances by the French law of July 26, 1968, as amended, which may preclude or restrict the obtaining of evidence in France or from French persons in
connection with such actions. Additionally, awards of punitive damages in actions brought in the United States or elsewhere may be unenforceable in France.



C. Material Contracts



Sanofi-Aventis has executed a Facilities Agreement (the Facilities Agreement) with J.P. Morgan plc, Société
Générale Corporate & Investment Banking and BNP Paribas (the Initial Mandated Lead Arrangers) for unsecured term loan facilities of up to US $15,000,000,000 for the purpose of financing part of the proposed
acquisition of Genzyme Corporation (together, the Acquisition Facility):



| |  |  | A US $10,000,000,000 term facility (Facility A) maturing 18 months from October 2, 2010, the date of execution of the Facilities
Agreement. The maturity of Facility A can be postponed by sanofi-aventis by 6 months.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | A US $5,000,000,000 amortizable term facility (Facility B) with final maturity at 42 months from the date of execution of the Facilities
Agreement.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------



The interest rate on
each facility is equal to the London Inter-Bank Overnight Rate (or LIBOR), plus an applicable margin.



The Initial Mandated Lead Arrangers have committed to provide the full amount of the loans under the Acquisition Facility and have
indicated their intention to form a syndicate of banks that would become lenders thereunder. The Facilities Agreement contains representations and warranties customary for credit facilities of this nature, including as to the accuracy of financial
statements, litigation and no conflict with material agreements or instruments. The Facilities Agreement contains certain covenants, including limitations on liens (with exclusions to the extent necessary to comply with margin lending regulations
and certain other exceptions to be agreed upon), mergers, compliance with laws and change of business. The commitment of the Initial Mandated Lead Arrangers is available until December 31, 2011 at the latest and is conditional upon, among other
things, there being no change in control of Parent, receipt of required approvals and consents and delivery of certain financial statements.



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A copy of the Facilities Agreement and an amendment dated February 15, 2011 is on file with
the SEC as exhibit 4.1 and 4.2 hereto. Reference is made to such exhibits for a more complete description of the terms and conditions of the Acquisition Facility as amended, and the foregoing summary of such terms and conditions is qualified in its
entirety by such exhibits.



On February 16, 2011,
sanofi-aventis and its wholly owned subsidiary GC Merger Corp. signed an Agreement and Plan of Merger which is governed by the laws of the Commonwealth of Massachusetts, and subject to the jurisdiction of the courts of the Commonwealth of
Massachusetts (the Merger Agreement), with Genzyme Corporation (Genzyme). Pursuant to the Merger Agreement, among other things, sanofi-aventis and GC Merger Corp. agreed to amend the outstanding tender offer to acquire all of
the outstanding shares of common stock of Genzyme (the Genzyme Shares) for $69 per Genzyme Share in cash (the tender offer as amended, the Amended Offer) to reflect the terms of the Merger Agreement and to increase the
consideration offered to (i) $74.00 in cash (the Cash Consideration) and (ii) one contingent value right (a CVR) to be issued by sanofi-aventis subject to and in accordance with the CVR Agreement described below
(collectively, the Merger Consideration) per Genzyme Share. The Merger Agreement also provides that, subject to the satisfaction or waiver of certain conditions, following consummation of the Amended Offer, GC Merger Corp. will be merged
with and into Genzyme, with Genyzme surviving the Merger as a wholly-owned subsidiary of sanofi-aventis (the Merger).



At the effective time of the Merger (the Effective Time), all remaining outstanding Genzyme Shares not tendered in the Amended
Offer (other than Genzyme Shares owned by Genzyme, sanofi-aventis or either of their respective subsidiaries), will be converted into the right to receive the Merger Consideration. All outstanding Genzyme stock options (other than those arising
under the Genzyme employee stock purchase plan and those with an exercise price in excess of the Cash Consideration) (Genzyme Options), restricted stock (Restricted Stock) and restricted stock units (RSUs) of
Genzyme will be canceled immediately prior to consummation of the Amended Offer. Holders of Genzyme Options with an exercise price less than the Cash Consideration will receive, for each Genzyme Share subject to such Option, (i) a cash payment
equal to the difference between the Cash Consideration and the exercise price of the Option, and (ii) one CVR. Holders of Restricted Stock and RSUs will receive (i) a cash payment equal to the Cash Consideration and (ii) one CVR per
Restricted Share or RSU.



The Merger Agreement
provides that sanofi-aventis shall cause GC Merger Corp. to amend the Offer and sanofi-aventis shall file a registration statement with the US Securities and Exchange Commission (SEC) to register the CVRs (the CVR Registration
Statement) within fifteen business days after the date of the Merger Agreement. In the Amended Offer, each Genzyme Share accepted by GC Merger Corp. in accordance with the terms and conditions of the Amended Offer will be exchanged for the
right to receive the Merger Consideration. Sanofi-aventis shall cause GC Merger Corp. to accept for payment, and GC Merger Corp. shall accept for payment, all Genzyme Shares validly tendered and not validly withdrawn, pursuant to the terms and
conditions of the Amended Offer, promptly following the Amended Offers expiration date.



GC Merger Corp.s obligation to accept for payment and pay for all Genzyme Shares validly tendered pursuant to the Amended Offer is subject to the conditions that (a) the number of Genzyme
Shares validly tendered and not validly withdrawn, together with any Genzyme Shares already owned by sanofi-aventis and its subsidiaries, represents at least a majority of the then-outstanding Genzyme Shares on a fully-diluted basis, (b) the
CVR Registration Statement has been declared effective and no stop order suspending the effectiveness of the CVR Registration Statement is in effect and no proceedings for that purpose have been initiated or threatened by the SEC, (c) the CVRs
being issued have been approved for listing on Nasdaq, (d) the CVR Agreement has been duly executed by sanofi-aventis and a mutually agreeable trustee and (e) certain other customary conditions as set forth in the Merger Agreement.



Genzyme has also granted to sanofi-aventis an
irrevocable option (the Top-Up Option), which GC Merger Corp. will exercise promptly following consummation of the Amended Offer, under certain circumstances and subject to certain conditions, to purchase from Genzyme the number of
Genzyme Shares that, when added to the Genzyme Shares already owned by sanofi-aventis or any of its subsidiaries following consummation of the Amended Offer, constitutes one Genzyme Share more than 90% of the Genzyme Shares then outstanding on a
fully-diluted basis. If sanofi-aventis, GC Merger Corp. and any of their respective affiliates acquire more than 90% of the outstanding Genzyme Shares, including through exercise of the Top-Up Option, GC Merger Corp. will complete the Merger through
the short form procedures available under Massachusetts law.



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Sanofi-aventis, GC Merger Corp. and Genzyme each made representations, warranties and
covenants in the Merger Agreement, including, among others, covenants by Genzyme to conduct its business in the ordinary course during the interim period between the execution of the Merger Agreement and consummation of the Merger.



The Merger Agreement prohibits Genzyme from soliciting or
knowingly encouraging competing acquisition proposals. However, Genzyme may, subject to the terms and conditions set forth in the Merger Agreement, provide information to a third party that makes an unsolicited acquisition proposal, and may engage
in discussions and negotiations with a third party that makes an unsolicited acquisition proposal that the Genzyme board of directors determines constitutes or would reasonably be expected to lead to or result in a Superior Proposal (as defined in
the Merger Agreement).



The Merger Agreement also
provides for certain termination rights for both sanofi-aventis and Genzyme. Upon termination of the Merger Agreement under specified circumstances, Genzyme may be required to pay sanofi-aventis a termination fee of $575 million.



The Merger Agreement also provides that either party may
specifically enforce the other partys obligations under the Merger Agreement.



The Contingent Value Rights Agreement.



At or prior to the expiration of the Amended Offer, sanofi-aventis and a mutually acceptable trustee will enter into a
Contingent Value Rights agreement governed by the laws of the State of New York and subject to the jurisdiction of the courts of the State of New York (CVR Agreement) governing the terms of the CVRs. A holder of a CVR is entitled to cash
payments upon the achievement of certain milestones, including based on production levels of Cerezyme® and
Fabrazyme®, U.S. regulatory approval of alemtuzumab for treatment of multiple sclerosis (Lemtrada), and on achievement of certain aggregate Lemtrada sales thresholds, as follows:



| |  |  | Cerezyme®/Fabrazyme®Production Milestone Payment. $1 per CVR, if both Cerezyme® production meets or exceeds 734,600 400-unit vial equivalents and Fabrazyme® production meets or exceeds 79,000 35mg vial equivalents during calendar year 2011.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Approval Milestone Payment. $1 per CVR upon receipt by Genzyme or any of its affiliates, on or before March 31, 2014, of the approval by the
U.S. Food and Drug Administration of Lemtrada for treatment of multiple sclerosis.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Product Sales Milestone #1 Payment. $2 per CVR if Lemtrada net sales post launch exceeds an aggregate of $400 million within specified periods and territory.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Product Sales Milestone #2 Payment. $3 per CVR upon the first instance in which global
Lemtrada net sales for a four calendar quarter period are equal to or in excess of $1.8 billion. If Product
Sales Milestone #2 is achieved but the Approval Milestone was not achieved prior to March 31, 2014, the milestone payment amount will be $4 per CVR (however, in such event the Approval Milestone shall not also be payable).
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Product Sales Milestone #3 Payment. $4 per CVR upon the first instance in which global
Lemtrada net sales for a four calendar quarter period are equal to or in excess of $2.3 billion (no quarter in
which global Lemtrada net sales were used to determine the achievement of Product Sales Milestone #1 or #2
shall be included in the calculation of sales for determining whether Product Sales Milestone #3 has been achieved).
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Product Sales Milestone #4 Payment. $3 per CVR upon the first instance in which global
Lemtrada net sales for a four calendar quarter period are equal to or in excess of $2.8 billion (no quarter in
which global Lemtrada net sales were used to determine the achievement of Product Sales Milestone #1, #2 or #3
shall be included in the calculation of sales for determining whether Product Sales Milestone #4 has been achieved).
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The CVRs will expire and no payments will be due under the CVR agreement on the earlier of (a) December 31, 2020 and
(b) the date that Product Sales Milestone #4 is paid.



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Sanofi-aventis has agreed to use commercially reasonable efforts to
achieve the Cerezyme®/Fabrazyme® Production Milestone, and diligent efforts (as defined in the CVR Agreement) to achieve each of the other milestones above. Sanofi-aventis has also agreed to use its
commercially reasonable efforts to maintain a listing for trading of the CVRs on Nasdaq.



The CVR Agreement does not prohibit sanofi-aventis or any of its subsidiaries or affiliates from acquiring the CVRs,
whether in open market transactions, private transactions or otherwise; sanofi-aventis has certain disclosure obligations in connection with such acquisitions under the CVR Agreement. On or after the third anniversary of the launch of Lemtrada, sanofi-aventis may also, subject to certain terms and conditions as set forth in the CVR Agreement, optionally
purchase and cancel all (but not less than all) of the outstanding CVRs at the average trading price of the CVRs if the volume-weighted average CVR trading price is less than fifty cents over forty-five trading days and Lemtrada sales in the prior four quarter period were less than one billion dollars in the aggregate.



A copy of the Merger Agreement and the form of CVR Agreement
are on file with the SEC as exhibit 4.3 and 4.4 hereto, respectively. Reference is made to such exhibits for a more complete description of the terms and conditions of the Merger Agreement and the CVR Agreement, and the foregoing summary of such
terms and conditions is qualified in its entirety by such exhibits.



D. Exchange Controls



French exchange control regulations currently do not limit the amount of payments that we may remit to non-residents of France. Laws and
regulations concerning foreign exchange controls do require, however, that all payments or transfers of funds made by a French resident to a non-resident be handled by an accredited intermediary. In France, all registered banks and most credit
establishments are accredited intermediaries.



E. Taxation



General



The following generally summarizes the material French and U.S. federal income tax consequences to U.S. holders (as defined below) of
owning and disposing of our ADSs, ordinary shares, PSSAs and PSSA-ADSs (collectively the Securities). This discussion is intended only as a descriptive summary and does not purport to be a complete analysis or listing of all potential
tax effects of the purchase, ownership or disposition of our Securities.



This summary does not constitute a legal opinion or tax advice. Holders are urged to consult their own tax advisers regarding the tax consequences of the purchase, ownership and disposition of
Securities in light of their particular circumstances, including the effect of any U.S. federal, state, local or other national tax laws.



The description of the French and U.S. federal income tax consequences set forth below is based on the laws (including, for U.S. federal
income tax purposes, the Internal Revenue Code of 1986, as amended (the Code), final, temporary and proposed U.S. Treasury Regulations promulgated thereunder and administrative and judicial interpretations thereof) in force as of the
date of this annual report, the Convention Between the Government of the United States of America and the Government of the French Republic for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and
Capital of August 31, 1994 (the Treaty), which entered into force on December 30, 1995 (as amended by any subsequent protocols, including the protocol of January 13, 2009), and the tax regulations issued by the French tax
authorities (the Regulations) in force as of the date of this report. All of the foregoing is subject to change. Such changes could apply retroactively and could affect the consequences described below.



In particular, the United States and France signed a protocol
on January 13, 2009, that made several changes to the Treaty, including changes to the Limitation on Benefits provision. The protocol entered into force on December 23, 2009; its provisions became effective in respect of
withholding taxes for amounts paid or credited on or after January 1, 2009 and in respect of other taxes for taxable years beginning on or after January 1, 2010. U.S. holders are advised to consult their own tax advisers regarding the
effect the protocol may have on their eligibility for Treaty benefits in light of their own particular circumstances.



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For the purposes of this discussion, a U.S. holder is a beneficial owner of Securities that
is (i) an individual who is a U.S. citizen or resident for U.S. federal income tax purposes, (ii) a U.S. domestic corporation or certain other entities created or organized in or under the laws of the United States or any state thereof,
including the District of Colombia, or (iii) otherwise subject to U.S. federal income taxation on a net income basis in respect of Securities. A non-U.S. holder is a person other than a U.S. holder.



If a partnership holds Securities, the tax treatment of a
partner generally will depend upon the status of the partner and the activities of the partnership. If a U.S. holder is a partner in a partnership that holds Securities, the holder is urged to consult its own tax adviser regarding the specific
tax consequences of acquiring, owning and disposing of Securities.



This discussion is intended only as a general summary and does not purport to be a complete analysis or listing of all potential tax effects of the acquisition, ownership or disposition of the Securities
to any particular investor, and does not discuss tax considerations that arise from rules of general application or that are generally assumed to be known by investors. The discussion applies only to investors that hold our Securities as capital
assets, that have the U.S. dollar as their functional currency, that are entitled to Treaty benefits under the Limitation on Benefits provision contained in the Treaty, and whose ownership of the Securities is not effectively connected
to a permanent establishment or a fixed base in France. Certain holders (including, but not limited to, U.S. expatriates, partnerships or other entities classified as partnerships for U.S. federal income tax purposes, banks, insurance companies,
regulated investment companies, tax-exempt organizations, financial institutions, persons subject to the alternative minimum tax, persons who acquired the Securities pursuant to the exercise of employee stock options or otherwise as compensation,
persons that own (directly, indirectly or by attribution) 5% or more of our voting stock or 5% or more of our outstanding share capital, dealers in securities or currencies, persons that elect to mark their securities to market for U.S. federal
income tax purposes and persons holding Securities as a position in a synthetic security, straddle or conversion transaction) may be subject to special rules not discussed below. Holders of Securities are advised to consult their own tax advisers
with regard to the application of French tax law and U.S. federal income tax law to their particular situations, as well as any tax consequences arising under the laws of any state, local or other foreign jurisdiction.



French Taxes



Estate and Gift Taxes and Transfer Taxes



In general, a transfer of Securities by gift or by reason of death of a U.S. holder that would otherwise be
subject to French gift or inheritance tax, respectively, will not be subject to such French tax by reason of the Convention between the Government of the United States of America and the Government of the French Republic for the Avoidance of Double
Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Estates, Inheritances and Gifts, dated November 24, 1978, unless the donor or the transferor is domiciled in France at the time of making the gift or at the time of his or
her death, or the Securities were used in, or held for use in, the conduct of a business through a permanent establishment or a fixed base in France.



Generally, transfers of Securities (other than ordinary shares) are not subject to French registration or stamp duty. Generally, transfers
of ordinary shares will not be subject to French registration or stamp duty if such transfers are not evidenced by a written agreement or if such an agreement is executed outside of France.



Wealth Tax



The French wealth tax impôt de solidarité sur la fortunedoes not generally apply to the Securities if the holder is a
U.S. resident, as defined pursuant to the provisions of the Treaty.



U.S. Taxes



Ownership of the Securities



Deposits and withdrawals by a U.S. holder of ordinary shares in exchange for ADSs, or of PSSAs in exchange for PSSA-ADSs (including in
connection with the intended termination of the deposit agreement with respect to the PSSA-ADSs), will not be taxable events for U.S. federal income tax purposes. For U.S. tax



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purposes, holders of ADSs will be treated as owners of the ordinary shares represented by such ADSs, and holders of PSSA-ADSs will be treated as owners of the PSSAs represented by such PSSA-ADSs.
Accordingly, the discussion that follows regarding the U.S. federal income tax consequences of acquiring, owning and disposing of ordinary shares and PSSAs is equally applicable to ADSs and PSSA-ADSs, respectively.



Information Reporting and Backup Withholding Tax



Distributions made to holders and proceeds
paid from the sale, exchange, redemption or disposal of Securities may be subject to information reporting to the Internal Revenue Service. Such payments may be subject to backup withholding taxes unless the holder (i) is a corporation or other
exempt recipient or (ii) provides a taxpayer identification number and certifies that no loss of exemption from backup withholding has occurred. Holders that are not U.S. persons generally are not subject to information reporting or backup
withholding. However, such a holder may be required to provide a certification of its non-U.S. status in connection with payments received within the United States or through a U.S.-related financial intermediary to establish that it is an exempt
recipient. Backup withholding is not an additional tax. Amounts withheld as backup withholding may be credited against a holders U.S. federal income tax liability. A holder may obtain a refund of any excess amounts withheld under the backup
withholding rules by filing the appropriate claim for refund with the Internal Revenue Service and furnishing any required information.



State and Local Taxes



In addition to U.S. federal income tax, U.S. holders of Securities may be subject to U.S. state and local taxes with respect to such
Securities. Holders of Securities are advised to consult their own tax advisers with regard to the application of U.S. state and local income tax law to their particular situation.



ADSs-Ordinary Shares



French Taxes



Taxation of Dividends



Under French law, dividends paid by a French corporation, such as sanofi-aventis, to non-residents of France are generally subject to
French withholding tax at a rate of 25% (19% for distributions made to individuals that are resident in the European Economic Area, and 15% for distributions made to non-for-profit organizations with a head office in a Member State of the European
Economic Area which would be subject to the tax regime set forth under article 206-5 of the French General Tax Code if its head office were located in France and which meet the criteria set forth in the administrative guidelines 4 H-2-10 of
January 15, 2010). Dividends paid by a French corporation, such as sanofi-aventis, towards non-cooperative States or territories, as defined in Article 238-0 A of the French General Tax Code, will generally be subject to French withholding tax at a
rate of 50%, irrespective of the tax residence of the beneficiary of the dividends if the dividends are received in such States or territories; however, eligible U.S. holders entitled to Treaty benefits under the Limitation on Benefits
provision contained in the Treaty and receiving dividends in non-cooperative States or territories will not be subject to this 50% withholding tax.



Under the Treaty, the rate of French withholding tax on dividends paid to an eligible U.S. holder whose ownership of the ordinary shares
or ADSs is not effectively connected with a permanent establishment or fixed base that such U.S. holder has in France is reduced to 15% and a U.S. holder may claim a refund from the French tax authorities of the amount withheld in excess of the
Treaty rate of 15%, if any. For U.S. holders that are not individuals, the requirements for eligibility for Treaty benefits, including the reduced 15% withholding tax rate, contained in the Limitation on Benefits provision of the Treaty
are complicated, and certain technical changes were made to these requirements by the protocol of January 13, 2009. U.S. holders are advised to consult their own tax advisers regarding their eligibility for Treaty benefits in light of their own
particular circumstances.



Dividends paid to an
eligible U.S. holder may immediately be subject to the reduced rate of 15%, provided that such holder establishes before the date of payment that it is a U.S. resident under the Treaty by completing and providing the depositary with a treaty form
(Form 5000). Dividends paid to a U.S. holder that has not filed the Form 5000 before the dividend payment date will be subject to French withholding tax at the rate of 25% and



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then reduced at a later date to 15%, provided that such holder duly completes and provides the French tax authorities with the treaty forms Form 5000 and Form 5001 before December 31 of the
second calendar year following the year during which the dividend is paid. Pension funds and certain other tax-exempt entities are subject to the same general filing requirements as other U.S. holders except that they may have to supply additional
documentation evidencing their entitlement to these benefits.



Form 5000 and Form 5001, together with instructions, will be provided by the depositary to all U.S. holders registered with the depositary and is also available from the U.S. Internal Revenue Service. The
depositary will arrange for the filing with the French Tax authorities of all such forms properly completed and executed by U.S. holders of ordinary shares or ADSs and returned to the depositary in sufficient time that they may be filed with the
French tax authorities before the distribution so as to obtain immediately a reduced withholding tax rate.



The withholding tax refund, if any, ordinarily is paid within 12 months of filing the applicable French Treasury Form, but not before
January 15 of the year following the calendar year in which the related dividend is paid.



Tax on Sale or Other Disposition



In general, under the Treaty, a U.S. holder who is a U.S. resident for purposes of the Treaty will not be subject to French tax on any capital gain from the redemption, sale or exchange of ordinary shares
or ADSs unless the ordinary shares or the ADSs form part of the business property of a permanent establishment or fixed base that the U.S. holder has in France. Special rules apply to holders who are residents of more than one country.



U.S. Taxes



Taxation of Dividends



For U.S. federal income tax purposes, the gross amount of
any distribution paid to U.S. holders (that is, the net distribution received plus any tax withheld therefrom) will be treated as ordinary dividend income to the extent paid or deemed paid out of the current or accumulated earnings and profits of
sanofi-aventis (as determined under U.S. federal income tax principles). Dividends paid by sanofi-aventis will not be eligible for the dividends-received deduction generally allowed to corporate U.S. holders.



Subject to certain exceptions for short-term and hedged
positions, the U.S. dollar amount of dividends received by an individual U.S. holder with respect to taxable years beginning before January 1, 2013, with respect to the ADSs or our ordinary shares will be subject to taxation at a maximum rate
of 15% if the dividends are qualified dividends. Dividends paid on the ordinary shares or ADSs will be treated as qualified dividends if (i) the issuer is eligible for the benefits of a comprehensive income tax treaty with the
United States that the Internal Revenue Service has approved for the purposes of the qualified dividend rules and (ii) the issuer was not, in the year prior to the year in which the dividend was paid, and is not, in the year in which the
dividend is paid, a passive foreign investment company (PFIC). The Treaty has been approved for the purposes of the qualified dividend rules. Based on our audited financial statements and relevant market and shareholder data, we believe
sanofi-aventis was not a PFIC for U.S. federal income tax purposes with respect to its 2010 taxable year. In addition, based on its audited financial statements and current expectations regarding the value and nature of its assets, the sources and
nature of its income, and relevant market and shareholder data, we do not anticipate that sanofi-aventis will become a PFIC for its 2011 taxable year. Holders of ordinary shares and ADSs should consult their own tax advisers regarding the
availability of the reduced dividend tax rate in light of their own particular circumstances.



If you are a U.S. holder, dividend income received by you with respect to ADSs or ordinary shares generally will be treated as foreign source income for foreign tax credit purposes. The limitation on
foreign taxes eligible for credit is calculated separately with respect to specific classes of income. Distributions out of earnings and profits with respect to the ADSs or ordinary shares generally will be treated as passive category
income (or, in the case of certain U.S. holders, general category income). Subject to certain limitations, French income tax withheld in connection with any distribution with respect to the ADSs or ordinary shares may be claimed as a
credit against the U.S. federal income tax liability of a U.S. holder if such U.S. holder elects for that year to



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credit all foreign income taxes. Alternatively, such French withholding tax may be taken as a deduction against taxable income. Foreign tax credits will not be allowed for withholding taxes
imposed in respect of certain short-term or hedged positions in Securities and may not be allowed in respect of certain arrangements in which a U.S. holders expected economic profit is insubstantial. The U.S. federal income tax rules
governing the availability and computation of foreign tax credits are complex. U.S. holders should consult their own tax advisers concerning the implications of these rules in light of their particular circumstances.



To the extent that an amount received by a U.S. holder
exceeds the allocable share of our current and accumulated earnings and profits, such excess will be applied first to reduce such U.S. holders tax basis in its ordinary shares or ADSs and then, to the extent it exceeds the U.S. holders
tax basis, it will constitute capital gain from a deemed sale or exchange of such ordinary shares or ADSs (see  Tax on Sale or Other Disposition, below).



The amount of any distribution paid in euros will be equal to
the U.S. dollar value of the euro amount distributed, calculated by reference to the exchange rate in effect on the date the dividend is received by a U.S. holder of ordinary shares (or by the depositary, in the case of ADSs) regardless of whether
the payment is in fact converted into U.S. dollars on such date. U.S. holders should consult their own tax advisers regarding the treatment of foreign currency gain or loss, if any, on any euros received by a U.S. holder or depositary that are
converted into U.S. dollars on a date subsequent to receipt.



Distributions to holders of additional ordinary shares (or ADSs) with respect to their ordinary shares (or ADSs) that are made as part of a pro rata distribution to all ordinary shareholders generally
will not be subject to U.S. federal income tax. However, if a U.S. holder has the option to receive a distribution in shares (or ADSs) or to receive cash in lieu of such shares (or ADSs), the distribution of shares (or ADSs) will be taxable as if
the holder had received an amount equal to the fair market value of the distributed shares (or ADSs), and such holders tax basis in the distributed shares (or ADSs) will be equal to such amount.



Tax on Sale or Other Disposition



In general, for U.S. federal income tax purposes, a U.S.
holder that sells, exchanges or otherwise disposes of its ordinary shares or ADSs will recognize capital gain or loss in an amount equal to the U.S. dollar value of the difference between the amount realized for the ordinary shares or ADSs and the
U.S. holders adjusted tax basis (determined in U.S. dollars and under U.S. federal income tax rules) in the ordinary shares or ADSs. Such gain or loss generally will be U.S. -source gain or loss, and will be treated as long-term capital gain
or loss if the U.S. holders holding period in the ordinary shares or ADSs exceeds one year at the time of disposition. If the U.S. holder is an individual, any capital gain generally will be subject to U.S. federal income tax at preferential
rates (currently a maximum of 15%) if specified minimum holding periods are met. The deductibility of capital losses is subject to significant limitations.



Participating Shares Series A (PSSAs) and PSSA-ADSs



French Taxes



Taxation of Annual Payments and Any Reorganization
Payment



Under French law, no French
withholding tax is imposed on Annual Payments on the Participating Shares Series A (PSSAs) owned by U.S. holders. Pursuant to Article 131 quater of the French General Tax Code, the withholding tax exemption on Annual Payments is not
subject to any filing requirement because the PSSAs have been offered exclusively outside France before March 1, 2010. In the event that French law should change and a French withholding tax becomes applicable to the Annual Payments,
(i) sanofi-aventis or an affiliate shall be obligated, to the extent it may lawfully do so, to gross up such payments (with certain exceptions relating to the holders connection with France, failure to claim an exemption or failure to
present timely such shares for payment) so that, after the payment of such withholding tax, the holder will receive an amount equal to the amount which the holder would have received had there been no withholding or (ii) sanofi-aventis may
redeem the PSSAs.



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Taxation of Redemption



In general, under the Treaty, a U.S. holder who is a U.S. resident for purposes of the Treaty will not be
subject to French tax on any capital gain from the redemption, sale or exchange of PSSAs or PSSA-ADSs unless the PSSAs or PSSA-ADSs form part of the business property of a permanent establishment or fixed base that the U.S. holder has in
France. Special rules apply to holders who are residents of more than one country.



U.S. Taxes



Taxation of Annual Payments



For U.S. federal income tax purposes, the gross amount of the annual payments paid to U.S. holders entitled thereto will be treated as ordinary dividend income (in an amount equal to the cash or fair
market value of the property received) to the extent paid out of our current or accumulated earnings and profits (as determined under U.S. federal income tax principles). Such dividends generally will be foreign-source income and generally will be
treated as passive category (or, in the case of certain U.S. holders, general category) income for foreign tax credit purposes. Dividends paid by sanofi-aventis will not be eligible for the dividends-received deduction
generally allowed to corporate U.S. holders.



Subject to certain exceptions for short-term and hedged positions, the U.S. dollar amount of dividends received by a U.S. holder that is
an individual with respect to taxable years beginning before January 1, 2011 with respect to the PSSAs or PSSA-ADSs will be subject to taxation at a maximum rate of 15% if the dividends are qualified dividends. Dividends paid on the
PSSAs or PSSA-ADSs will be treated as qualified dividends if (i) the issuer is eligible for the benefits of a comprehensive income tax treaty with the United States that the Internal Revenue Service has approved for the purposes of the
qualified dividend rules and (ii) the issuer was not, in the year prior to the year in which the dividend was paid, and is not, in the year in which the dividend is paid, a passive foreign investment company (PFIC). The Treaty has been approved
for the purposes of the qualified dividend rules. Based on our audited financial statements and relevant market and shareholder data, we believe we were not a PFIC for U.S. federal income tax purposes with respect to our 2010 taxable year. In
addition, based on our audited financial statements and current expectations regarding the value and nature of our assets, the sources and nature of our income, and relevant market and shareholder data, we do not anticipate that we will become a
PFIC for our 2010 taxable year. Holders of PSSAs and PSSA-ADSs should consult their own tax advisers regarding the availability of the reduced dividend tax rate in light of their own particular circumstances.



To the extent that an amount received by a U.S. holder
exceeds the allocable share of our current and accumulated earnings and profits, such excess will be applied first to reduce such U.S. holders tax basis in its PSSAs or PSSA-ADSs and then, to the extent it exceeds the U.S. holders tax
basis, it will constitute gain from a deemed sale or exchange of such PSSAs or PSSA-ADSs (see  Tax on Sale or Other Disposition (Including Redemption), below).



The amount of any distribution paid in euros will be equal to
the U.S. dollar value of the distributed euros, calculated by reference to the exchange rate in effect on the date the dividend is received by a U.S. holder of PSSAs (or by the depositary, in the case of PSSA-ADSs), regardless of whether the payment
is in fact converted into U.S. dollars on such date. U.S. holders should consult their own tax advisers regarding the treatment of foreign currency gain or loss, if any, on any euros received by a U.S. holder or depositary that are converted into
U.S. dollars on a date subsequent to receipt.



Tax on Sale or Other Disposition (Including Redemption)



In general, for U.S. federal income tax purposes, a U.S.
holder that sells, exchanges or otherwise disposes of PSSAs or PSSA-ADSs will recognize capital gain or loss in an amount equal to the U.S. dollar value of the difference between the amount realized for the PSSAs or PSSA-ADSs and the holders
adjusted tax basis (determined in U.S. dollars) in the PSSAs or PSSA-ADSs. Such gain or loss generally will be U.S. -source gain or loss, and will be treated as long-term capital gain or loss if the U.S. holders holding period in the PSSAs or
PSSA-ADSs exceeds one year at the time of disposition. If the U.S. holder is an individual, any capital gain



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generally will be subject to U.S. federal income tax at preferential rates (currently a maximum of 15%) if specified minimum holding periods are met. The deductibility of capital losses is
subject to significant limitations.



If, however,
a U.S. holders PSSAs or PSSA-ADSs are redeemed and it has a direct or indirect stock interest in sanofi-aventis after such redemption, then amounts received in a redemption could, under applicable U.S. tax rules, be treated as a distribution
taxable as a dividend that is measured by the full amount of cash received by such U.S. holder (to the extent of the current and accumulated earnings and profits of sanofi-aventis, as described above in Taxation of Annual Payments).
U.S. holders should consult their own tax advisers as to the application of these rules to any such redemption.



F. Dividends and Paying Agents



N/A



G. Statement by Experts



N/A



H. Documents on Display



We are subject to the information requirements of the U.S. Securities Exchange Act of 1934, as amended, and, in accordance therewith, we
are required to file reports, including annual report on Form 20-F, and other information with the U.S. Securities and Exchange Commission by electronic means. Our public filings are available to the public over the Internet at the Commissions
Website at http://www.sec.gov (these documents are not incorporated by reference in this annual report).



I. Subsidiary Information



N/A



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Item 11. Quantitative and Qualitative Disclosures
about Market Risk(1)



General Policy



Liquidity risk, foreign exchange risk and interest rate
risk, as well as related counterparty risk, are managed centrally by our dedicated treasury team within the Group Finance Department. Where it is not possible to manage these risks centrally, in particular due to regulatory restrictions (such as
foreign exchange controls) or local tax restrictions, credit facilities and/or currency lines, guaranteed whenever necessary by the parent company, are contracted by our subsidiaries locally with banks, under the supervision of the central treasury
team.



Our investment and financing strategies, as
well as our interest rate and currency hedging strategies, are reviewed monthly by the Group Finance Department.



Our policy on derivatives prohibits speculative exposure.



Liquidity Risk



We operate a centralized treasury platform according to
which all surplus cash and financing needs of our subsidiaries are invested with or funded by the parent company (where permitted by local legislation). The central treasury department manages the Groups current and projected financing (debt,
net of cash and cash equivalents), and ensures that the Group is able to meet its financial commitments by maintaining sufficient cash and confirmed credit facilities for the size of our operations and the maturity of our debt.



The group tends to diversify its short term investments with
leading banks, using money-market products, that are immediately accessible or have a maturity of less than three months. As of December 31, 2010, cash and cash equivalents amounted to 6,465 million and short term investments mainly
comprised:



| |  |  | Mutual fund investments classified as Euro Money-Market Funds by the Autorité des Marchés Financiers, within a limit of 10% of
held assets.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Bank term deposits with a maturity of less than three months.
| | - |  | -------------------------------------------------------------



As of December 31, 2010, the Group had 12.2
billion of undrawn general corporate purpose confirmed credit facilities, not allocated to outstanding commercial paper drawdowns of which 6.2 billion expire in 2015, 5.8 billion in 2012, and 0.2 billion in 2011. Our credit
facilities are not subject to financial covenant ratios.



In connection with the launch of a public tender offer for Genzyme on October 4, 2010, sanofi-aventis contracted on October 2, 2010 two credit facilities totaling $15 billion. These facilities, amended on
February 15, 2011, may be drawn down in US dollars until December 31, 2011:



| |  |  | Facility A is a $10 billion facility expiring April 2, 2012 with an optional six-month extension.
| | - |  | -------------------------------------------------------------------------------------------------



| |  |  | Facility B is $5 billion amortizable facility expiring April 2, 2014.
| | - |  | ---------------------------------------------------------------------



These acquisition facilities are not subject to any financial covenant. The margin of Facility B will
depend on the long-term credit rating of sanofi-aventis subsequent to the acquisition.



Our policy is to diversify our sources of funding through public or private issuances of debt securities, in particular under our Euro Medium Term Note program, and by issuing commercial paper in France
and the United States. On March 15, 2010, the Group filed a U.S shelf, not being used as of today. The average maturity of our total debt is 3.9 years as of December 31, 2010, compared to 4.1 years as of December 31, 2009. Short-term
commercial paper programs (U.S. dollar-denominated commercial paper swapped into euros and euro-denominated commercial paper) are used to meet our short-term financing needs. Drawdowns under these



|(1) | Information in this section is complementary to Note B.8.8. to our consolidated financial statements included at Item 18 of this annual report, with regards to
information required by IFRS 7, and is covered by our independent registered public accounting firms report on the consolidated financial statements.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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programs are generally renewed for periods of 2 months. The commercial paper programs are backed by confirmed credit facilities (see description above), to permit the Group to continue to access
financing if raising funds via commercial paper is no longer possible (for more information, see Note D.17 to the consolidated financial statements). In 2010, the average drawdown under these programs was 0.9 billion (maximum 1.7
billion). As of December 31, 2010, the drawdown under these programs amounted to 0.7 billion.



In the context of a market-wide liquidity crisis and/or a downgrade of its rating, the Group could be exposed to a scarcity of its sources
of funding including the above-mentioned programs, or to a deterioration of their conditions. This situation could damage the capacity of the Group to refinance its debt or to issue new debt on reasonable conditions.



Interest Rate Risk



Our cost of debt is sensitive to changes in interest rates
as regards the floating-rate portion of the total debt (credit facilities, commercial paper, etc.), with reference to Eonia, US Libor and Euribor and in proportion to the amounts drawn under these programs. To optimize the cost of our debt or reduce
its volatility, we use interest rate swaps, cross-currency swaps, and, in certain circumstances interest rate options to alter the fixed rate / floating rate mix of our debt.



As of December 31, 2010, 66% of our total debt (amounting to 8,056 million) was fixed-rate and 34%
was floating-rate after taking account of interest rate derivatives. Our cash and cash equivalents (amounting to 6,465 million) are fully floating-rate.



As of December 31, 2010, the sensitivity of our total debt, net of cash and cash equivalents to interest rate fluctuations over a
full year is as follows:



|                          |  |                                       |     |  
|------------------------- |  | ------------------------------------- | --- | -
|Change in 3-month Euribor |  | Impact onpre-taxnet income( million) |    
|+ 100 bp                  |  |                                       | 41  |  
|+ 25 bp                   |  |                                       | 10  |  
|- 25 bp                   |  |                                       | (10 | )
|- 100 bp                  |  |                                       | (41 | )



Foreign Exchange Risk



a. Operational Foreign Exchange Risk



A substantial proportion of our net sales is generated in countries in which the euro, which is our reporting currency, is not the
functional currency. In 2010, for example, 29.5% of our consolidated net sales were generated in the United States. Although we also incur expenses in those countries, the impact of those expenses is not enough wholly to offset the impact of
exchange rates on net sales. Consequently, our operating income may be materially affected by fluctuations in the exchange rate between the euro and other currencies, primarily the U.S. dollar.



We operate a foreign exchange risk hedging policy to reduce
the exposure of our operating income to exchange rate movements. This policy involves regular assessments of our worldwide foreign currency exposure, based on budget estimates of foreign-currency transactions to be carried out by the parent company
and its subsidiaries. These transactions mainly comprise sales, purchases, research costs, co-marketing and co-promotion expenses, and royalties. To reduce the exposure of these transactions to exchange rate movements, we may contract currency
hedges using liquid financial instruments such as forward purchases and sales of currency as well as call and put options, and combinations of currency options (collars).



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The table below shows operational currency hedging derivatives in place as of
December 31, 2010, with the notional amount translated into euros at the relevant closing exchange rate. See also Note D.20. to the consolidated financial statements for the accounting classification of these instruments as of December 31,
2010.



Operational foreign exchange
derivatives as of December 31, 2010 (1)



|                                        |  |                 |       |  |            |  |     |  
|--------------------------------------- |  | --------------- | ----- |  | ---------- |  | --- | -
|( million)                             |  | Notional amount |       |  | Fair value | 
|Forward currency sales                  |  |                 | 2,444 |  |            |  | (25 | )
|Of which              U.S. dollar      |  |                 | 1,380 |  |            |  | (12 | )
|    Russian rouble                     |  |                 | 248   |  |            |  | (7  | )
|    Japanese yen                       |  |                 | 202   |  |            |  | (4  | )
|    Pound sterling                     |  |                 | 95    |  |            |  | 2   |  
|    Australian dollar                  |  |                 | 60    |  |            |  | (1  | )
|Forward currency purchases              |  |                 | 257   |  |            |  | (2  | )
|Of which              Hungarian forint |  |                 | 84    |  |            |  | (1  | )
|    U.S. dollar                        |  |                 | 51    |  |            |  | (1  | )
|    Canadian dollar                    |  |                 | 31    |  |            |  |    |  
|    Russian rouble                     |  |                 | 30    |  |            |  |    |  
|    Japanese yen                       |  |                 | 18    |  |            |  |    |  
|Total                                   |  |                 | 2,701 |  |            |  | (27 | )



|(1) | As of December 31, 2009, the notional amount of forward currency sales was
2,800 million with a fair value of -51 million (including forward sales of U.S. dollars of a notional amount of 1,757 million with a fair value of -41 million). As of December 31, 2009, the notional amount
of forward currency purchases was 377 million with a fair value of 6 million (including forward sales of U.S. dollars of a notional amount of 69 million with an immaterial fair value). In addition, as of
December 31, 2009, the Group portfolio included purchased put options of a notional amount of 448 million with a fair value of 14 million, written call options of a notional amount of 881 million with a fair
value of -17 million, written put options of a notional of 278 million with a fair value of -8 million and purchased call options of a notional of 555 million with a fair value of 10 million.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



As of December 31,
2010, none of these instruments had an expiry date after March 31, 2011.



These positions mainly hedge future foreign-currency cash flows arising after the balance sheet date in relation to transactions carried out during the year ended December 31, 2010 and recognized in
the balance sheet at that date. Gains and losses on derivative instruments (forward contracts) have been and will continue to be calculated and recognized in parallel with the recognition of gains and losses on the hedged items. Due to this hedging
relationship, the foreign exchange profit and loss on these items (derivative instruments and underlying assets as of December 31, 2010) will be close to zero in 2011.



b. Financial Foreign Exchange Risk



Some of our financing activities, such as the cash pooling
arrangements for foreign subsidiaries outside the euro zone and our U.S. commercial paper issues, expose certain entities to financial foreign exchange risk (i.e., the risk of changes in the value of loans and borrowings denominated in a currency
other than the functional currency of the lender or borrower). The net foreign exchange exposure mainly concerns the holding company and is hedged by firm financial instruments, usually forward contracts and currency swaps.



The table below shows financial currency hedging instruments
in place as of December 31, 2010, calculated using exchange rates prevailing as of that date. See also Note D.20. to the consolidated financial statements for the accounting classification of these instruments as of December 31, 2010.



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Financial foreign exchange derivatives as of December 31, 2010 (1)



|                                |  |                 |       |  |            |  |     |        |  |  |      | 
|------------------------------- |  | --------------- | ----- |  | ---------- |  | --- | ------ |  |  | ---- | 
|( million)                     |  | Notional amount |       |  | Fair value |  |     | Expiry | 
|Forward currency purchases      |  |                 | 2,086 |  |            |  | (13 | )      |  |  |      | 
|Of which          U.S. dollar  |  |                 | 814   |  |            |  | (8  | )      |  |  | 2011 | 
| Pound sterling                |  |                 | 565   |  |            |  | (11 | )      |  |  | 2011 | 
| Japanese yen                  |  |                 | 169   |  |            |  |    |        |  |  | 2011 | 
|Forward currency sales          |  |                 | 2,728 |  |            |  | (64 | )      |  |  |      | 
|Of which          Japanese yen |  |                 | 904   |  |            |  | (24 | )      |  |  | 2011 | 
| U.S. dollar                   |  |                 | 862   |  |            |  | (26 | )      |  |  | 2012 | 
| Czech koruna                  |  |                 | 359   |  |            |  | (7  | )      |  |  | 2011 | 
|Total                           |  |                 | 4,814 |  |            |  | (77 | )      |  |  |      | 



|(1) | As of December 31, 2009, the notional amount of forward currency purchases was
6,760 million with a fair value of 185 million (including forward purchases of U.S. dollars of a notional amount of 5,634 million with a fair value of 180 million). As of December 31, 2009, the notional
amount of forward currency sales was 3,169 million with a fair value of -7 million (including forward sales of U.S. dollars of a notional amount of 1,634 million with a fair value of -28 million).
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



These forward contracts
generate a net financial foreign exchange gain or loss arising from the interest rate gap between the hedged currency and the euro, given that the foreign exchange gain or loss on the foreign-currency liabilities and receivables is offset by the
change in the intrinsic value of the hedging instruments.



As of December 31, 2010, none of the instruments had an expiry date after September 30, 2012.



We may also hedge some future foreign-currency investment or divestment cash flows.



c. Other Foreign Exchange Risks



A significant portion of our consolidated assets is
denominated in U.S. dollars. For a breakdown of our assets, see Note D.35.2 to our consolidated financial statements. As a result, any fluctuation in the exchange rate of the U.S. dollar against the euro affects our equity, which may lead us to
contract hedges of our net investments in foreign operations. As of December 31, 2010, we had no derivative instruments in place to limit the effect of such fluctuations.



Counterparty Risk



Our financing and investing operations as well as our
currency and interest rate hedges, are contracted with leading banks. We set limits for investment and derivatives transactions with individual banks, depending on the rating of each bank. Compliance with these limits, which are based on notional
amounts weighted by the residual maturity of the commitment and on the nature of the commitment, is monitored on a daily basis.



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The table below shows our total exposure as of December 31, 2010 by rating and in terms of
our percentage exposure to the dominant counterparty.



|                                        |  |                                                      |          |  |                                       |  |          |                                       |  |  |                                            |  |  |  |        | 
|--------------------------------------- |  | ---------------------------------------------------- | -------- |  | ------------------------------------- |  | -------- | ------------------------------------- |  |  | ------------------------------------------ |  |  |  | ------ | 
|( million)                             |  | Cash and cash equivalents(excluding mutual funds)(1) |          |  | Notional amounts ofcurrency hedges(2) |  |          | Notional amounts ofinterest hedges(2) |  |  | General corporatepurpose credit facilities | 
|AA                                      |  |                                                      | 820      |  |                                       |  | 3,033    |                                       |  |  | 596                                        |  |  |  | 3,213  | 
|AA-                                     |  |                                                      | 392      |  |                                       |  | 2,475    |                                       |  |  | 396                                        |  |  |  | 1,648  | 
|A+                                      |  |                                                      | 345      |  |                                       |  | 2,426    |                                       |  |  | 92                                         |  |  |  | 6,363  | 
|A                                       |  |                                                      | 21       |  |                                       |  |         |                                       |  |  |                                           |  |  |  | 1,421  | 
|A-                                      |  |                                                      | 21       |  |                                       |  |         |                                       |  |  |                                           |  |  |  |       | 
|BBB ratings and not rated               |  |                                                      | 17       |  |                                       |  |         |                                       |  |  |                                           |  |  |  | 355    | 
|Unallocated                             |  |                                                      | 44       |  |                                       |  |         |                                       |  |  |                                           |  |  |  |       | 
|Total                                   |  |                                                      | 1,660    |  |                                       |  | 7,934    |                                       |  |  | 1,084                                      |  |  |  | 13,000 | 
|% / rating of the dominant counterparty |  |                                                      | 37% / AA |  |                                       |  | 12% / AA |                                       |  |  | 25% / AA-                                  |  |  |  | 9% /A+ | 



|(1) | Cash equivalents also include mutual fund investments of 4,805 million.
|--- | ------------------------------------------------------------------------

|(2) | The
notional amounts are computed on the basis of the forward rates negotiated at the inception date of the derivative instrument.
|--- | ----------------------------------------------------------------------------------------------------------------------------------



Mutual fund investments are mainly made by the sanofi-aventis parent company. These mutual fund investments, classified as Euro
Money-Market Funds by the Autorité des Marchés Financiers, show low volatility, low sensitivity to interest rate risk and a very low probability of loss of principal. Both the depositary banks of the mutual funds and the
depositaries of sanofi-aventis are at least A+ rated.



Realization of counterparty risk could impact our liquidity in certain circumstances.



Stock Market Risk



It is our policy not to trade on the stock market for speculative purposes.



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Item 12. Description of Securities other than Equity Securities



N/A



12.D American Depositary Shares



General



JPMorgan Chase Bank, N.A. (JPMorgan), as depositary, issues Sanofi-Aventis ADSs in certificated
form (evidenced by an American depositary receipt, or ADR) or book-entry form. Each ADR is a certificate evidencing a specific number of Sanofi-Aventis ADSs. Each Sanofi-Aventis ADS represents one-half of one Sanofi-Aventis ordinary share (or the
right to receive one-half of one Sanofi-Aventis ordinary share) deposited with the Paris, France office of BNP Paribas, as custodian.



Each Sanofi-Aventis ADS also represents an interest in any other securities, cash or other property that may be held by the depositary
under the deposit agreement. The depositarys office is located at 4 New York Plaza, New York, New York 10004.



A holder may hold Sanofi-Aventis ADSs either directly or indirectly through his or broker or other financial institution. The following
description assumes holders hold their Sanofi-Aventis ADSs directly, in certificated form evidenced by ADRs. Holders who hold the Sanofi-Aventis ADSs indirectly must rely on the procedures of their broker or other financial institution to assert the
rights of ADR holders described in this section. Holders should consult with their broker or financial institution to find out what those procedures are.



We do not treat holders of Sanofi-Aventis ADSs as one of our shareholders, and such holders do not have shareholder rights. French law
governs shareholder rights. The depositary is be the holder of the Sanofi-Aventis ordinary shares underlying holders Sanofi-Aventis ADSs. The rights of holders of Sanofi-Aventis ADSs are set forth in the deposit agreement between
Sanofi-Aventis and JPMorgan and in the ADR. New York law governs the deposit agreement and the ADRs.



The following is a summary of the deposit agreement, a form of which has been filed as an as an exhibit to our Form F-6 filed on
August 7, 2007 and which is incorporated by reference into this document. For more complete information, holders should read the entire deposit agreement and the ADR itself. Holders may also inspect a copy of the deposit agreement at the
depositarys office.



Share Dividends and Other
Distributions



Receipt of dividends and other
distributions



The depositary has agreed
to pay to holders of Sanofi-Aventis ADSs the cash dividends or other distributions that it or the custodian receives on the deposited Sanofi-Aventis ordinary shares and other deposited securities after deducting its fees and expenses. Holders of
Sanofi-Aventis ADSs will receive these distributions in proportion to the number of Sanofi-Aventis ADSs that they hold.



Cash. The depositary will convert any cash dividend or other cash distribution paid on the shares into U.S. dollars if it can
do so on a reasonable basis and can transfer the U.S. dollars to the United States. If that is not possible or if any approval from the French government is needed and cannot be obtained, the deposit agreement allows the depositary to distribute the
dividends only to those ADR holders to whom it is possible to do so. It will hold the foreign currency it cannot convert into U.S. dollars for the account of the ADR holders who have not been paid. It will not invest the funds it holds and it will
not be liable for any interest.



Before making a
distribution, any withholding taxes that must be paid under French law will be deducted. The depositary will distribute only whole U.S. dollars and cents and will round fractional cents down to the nearest whole cent. If the exchange rates
fluctuate during a time when the depositary cannot convert the euro, holders may lose some or all of the value of the distribution.



Shares. The depositary may, and at our request will, distribute new ADRs representing any shares we distribute as a dividend or
free distribution, if we furnish it promptly with satisfactory evidence that it is legal to



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do so. The depositary will only distribute whole Sanofi-Aventis ADSs. It will sell shares that would require it to deliver a fractional Sanofi-Aventis ADS and distribute the net proceeds in the
same way as it distributes cash. If the depositary does not distribute additional Sanofi-Aventis ADSs, the outstanding ADRs will also represent the new shares.



Rights to Receive Additional Shares. If we offer holders of Sanofi-Aventis ordinary shares any rights to subscribe for additional
shares or any other rights, the depositary after consultation with us may make these rights available to holders or dispose of such rights on behalf of any holders and make the net proceeds available. The depositary may make rights available to
certain holders but not others if it determines it is lawful and feasible to do so. The depositary must first consult with us. If by the terms of the offering or for any other reason, the depositary may not make such rights available or dispose of
such rights and make the net proceeds available, it will allow the rights to lapse. In that case, holders of Sanofi-Aventis ADSs will receive no value for them.



If the depositary makes rights available to holders of Sanofi-Aventis ADSs, upon instruction from such holders, it will exercise the
rights and purchase the shares on such holders behalf. The depositary will then deposit the shares and deliver ADRs to such holders. It will only exercise rights if holders of Sanofi-Aventis ADSs pay it the exercise price and any other charges
the rights require such holders to pay.



U.S.
securities laws may restrict the sale, deposit, cancellation and transfer of ADRs issued upon exercise of rights. For example, holders of Sanofi-Aventis ADSs may not be able to trade these Sanofi-Aventis ADSs freely in the United States. In this
case, the depositary may deliver Sanofi-Aventis ADSs under a separate restricted deposit agreement that will contain the same provisions as the deposit agreement, except for changes needed to put the restrictions in place.



Other Distributions. The depositary will send to
holders of Sanofi-Aventis ADSs anything else we distribute on deposited securities by any means it thinks is legal, fair and practical. If it cannot make the distribution in that way, the depositary has a choice. It may decide to sell what we
distributed and distribute the net proceeds in the same way as it distributes cash, or it may choose any method to distribute the property it deems equitable and practicable.



The depositary is not responsible if it decides that it is
unlawful or impractical to make a distribution available to any holders of Sanofi-Aventis ADSs. We have no obligation to register Sanofi-Aventis ADSs, shares, rights or other securities under the U.S. Securities Act of 1933, as amended. We also have
no obligation to take any other action to permit the distribution of ADRs, shares, rights or anything else to holders of Sanofi-Aventis ADSs. This means that holders may not receive the distribution we make on our shares or any value for them if it
is illegal or impractical for the depositary to make them available to such holders.



Deposit, Withdrawal and Cancellation



Delivery of ADRs



The depositary will deliver ADRs if the holder or his or her broker deposit shares or evidence of rights to receive shares with the custodian. Upon payment of its fees and expenses and any taxes or
charges, such as stamp taxes or stock transfer taxes or fees, the depositary will register the appropriate number of Sanofi-Aventis ADSs in the names the holder requests and will deliver the ADRs to the persons the holder requests at its office.



Obtaining Sanofi-Aventis ordinary shares



A holder may turn in his or her ADRs at
the depositarys office. Upon payment of its fees and expenses and any taxes or charges, such as stamp taxes or stock transfer taxes or fees, the depositary will deliver (1) the underlying shares to an account designated by the holder and
(2) any other deposited securities underlying the ADR at the office of a custodian or, at the holders request, risk and expense, the depositary will deliver the deposited securities at its office.



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Voting Rights



A holder may instruct the depositary to vote the
Sanofi-Aventis ordinary shares underlying his or her Sanofi-Aventis ADSs, but only if we ask the depositary to ask for holder instructions. Otherwise, holders will not be able to exercise their right to vote unless they withdraw the shares from the
ADR program and vote as an ordinary shareholder. However, holders may not know about the meeting sufficiently in advance to withdraw the shares.



If we ask for holder instructions, the depositary will notify holders of the upcoming vote and arrange to deliver our voting materials to
holders. The materials will (1) describe the matters to be voted on and (2) explain how holders may instruct the depositary to vote the shares or other deposited securities underlying their ADRs as holders direct. For instructions to be
valid, the depositary must receive them on or before the date specified. The depositary will try, as far as practical, subject to French law and the provisions of our statuts, to vote or to have its agents vote the shares or other deposited
securities as holders instruct. The depositary will only vote or attempt to vote as holders instruct.



We cannot assure holders that they will receive the voting materials in time to ensure that holders can instruct the depositary to vote
their shares. The depositary and its agents are not responsible for failing to carry out voting instructions or for the manner of carrying out voting instructions. This means that holders may not be able to exercise their right to vote and
there may be nothing holders can do if their shares are not voted as they requested.



Similar to our shares, Sanofi-Aventis ADSs evidenced by ADRs registered in the name of the same owner for at least two (2) years will be eligible for double voting rights if certain procedures are
followed, as set out in the deposit agreement. For additional information regarding double voting rights, see Item 10. Additional Information  B. Memorandum and Articles of Association  Voting Rights.



The deposit agreement allows the depositary and
Sanofi-Aventis to change the voting procedures or require additional voting procedures in addition to the ones described above if necessary or appropriate to comply with French or United States law or our statuts. For example, holders
might be required to arrange to have their Sanofi-Aventis ADSs deposited in a blocked account for a specified period of time prior to a shareholders meeting in order to be allowed to give voting instructions.



Notices and Reports; Rights of Holders to Inspect Books



Upon notice of any meeting of holders of shares or other
deposited securities, if requested in writing by Sanofi-Aventis, the depositary will, as soon as practicable thereafter, mail to the holders a notice, the form of which is in the discretion of the depositary, containing (a) a summary in English
of such information contained in the notice of meeting received by the depositary from the company, (b) a statement that the holders as of the close of business on a specified record date will be entitled, subject to any applicable provision of
French law and of our statuts, to instruct the depositary as to the exercise of the voting rights, if any, pertaining to the amount of shares or other deposited securities represented by their respective ADSs and (c) a statement as to
the manner in which such instructions may be given.



The depositary will make available for inspection by ADS holders at the depositarys office any reports and communications, including
any proxy soliciting material, received from usthat are both (a) received by the depositary as the holder of the deposited securities and (b) made generally available to the holders of such deposited securities by us. The depositary will
also, upon written request, send to ADS holders copies of such reports when furnished by us pursuant to the deposit agreement. Any such reports and communications, including any such proxy soliciting material, furnished to the depositary by us will
be furnished in English to the extent such materials are required to be translated into English pursuant to any regulations of the SEC.



The depositary will keep books for the registration of ADRs and transfers of ADRs that at all reasonable times will be open for inspection
by the holders provided that such inspection shall not be for the purpose of communicating with holders in the interest of a business or object other than our business or a matter related to the deposit agreement or the ADRs.



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Fees and Expenses



Fees Payable By ADS Holders



Pursuant to the deposit agreement, holders of our ADSs may
have to pay to JPMorgan, either directly or indirectly, fees or charges up to the amounts set forth in the table below.



|                                                                                                                                                                                                                                                                                                           |  |                                                                                                                                                                                                                                                                                                         
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Associated Fee                                                                                                                                                                                                                                                                                             |  | Depositary Action                                                                                                                                                                                                                                                                                       
|$5.00 or less per 100 ADSs (or portion thereof)                                                                                                                                                                                                                                                            |  | Execution and delivery of ADRs for distributions and dividends in shares and rights to subscribe for additional shares or rights of any other nature and surrender of ADRs for the
purposes of withdrawal, including the termination of the deposit agreement                                           
|                                                                                                                                                                                                                                                                                                           | 
|$0.02 or less per ADS (or portion thereof)                                                                                                                                                                                                                                                                 |  | Any cash distribution made pursuant to the deposit agreement, including, among other things:
  cash distributions or dividends,
  distributions other than cash, shares or
rights,   distributions in shares,
and   rights of any other nature,
including rights to subscribe for additional shares.
|                                                                                                                                                                                                                                                                                                           | 
|Taxes and other governmental charges                                                                                                                                                                                                                                                                       |  | As applicable                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                           | 
|Registration fees in effect for the registration of transfers of shares generally on the share register of the company or foreign registrar and applicable to transfers of shares to
or from the name of JPMorgan or its nominee to the custodian or its nominee on the making of deposits and withdrawals |  | As applicable                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                           | 
|A fee equal to the fee for the execution and delivery of ADSs which would have been charged as a result of the deposit of such securities                                                                                                                                                                  |  | Distributions of securities other than cash, shares or rights                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                           | 
|Any other charges payable by JPMorgan, its agents (and their agents), including BNP Paribas, as custodian (by deductions from cash dividends or other cash distributions or by
directly billing investors or by charging the book-entry system accounts of participants acting for them)                   |  | Servicing of shares or other deposited securities                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                           | 
|Expenses incurred by JPMorgan                                                                                                                                                                                                                                                                              |  |  Cable, telex and facsimile transmission (where expressly provided for in the deposit agreement)
  Foreign currency conversion into U.S.
dollars                                                                                                                                                      



Fees Paid to sanofi-aventis by the
Depositary



JPMorgan, as depositary, has
agreed to reimburse sanofi-aventis up to $4,000,000 per year for expenses sanofi-aventis incurs relating to legal fees, investor relations servicing, investor-related presentations, ADR-related advertising and public relations in those jurisdictions
in which the ADRs may be listed or otherwise quoted, investor relations channel, perception studies, accountants fees in relation to our annual report on Form 20-F or any other expenses directly or indirectly relating to managing the
program or servicing the shareholders. From January 1, 2010 to February 28, 2011, sanofi-aventis has obtained reimbursements corresponding to the ceiling of $4,000,000 for 2010. Furthermore, JPMorgan has agreed to waive up to $425,000 each year
in servicing fees for routine corporate actions, such as annual general meetings and divided distributions, as well as for other assistance such as tax and regulatory compliance fees, investor relations advisory services, etc.



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Payment of Taxes



Each holder will be responsible for any taxes or other
governmental charges payable on his or her Sanofi-Aventis ADSs or on the deposited securities underlying his or her Sanofi-Aventis ADSs. The depositary may refuse to transfer a holders Sanofi-Aventis ADSs or allow a holder to withdraw the
deposited securities underlying his or her Sanofi-Aventis ADSs until such taxes or other charges are paid. It may apply payments owed to a holder or sell deposited securities underlying a holders Sanofi-Aventis ADSs to pay any taxes owed, and
the holder will remain liable for any deficiency. If it sells deposited securities, it will, if appropriate, reduce the number of Sanofi-Aventis ADSs to reflect the sale and pay to the holder any proceeds, or send to the holder any property,
remaining after it has paid the taxes.



Changes Affecting
Deposited Securities



If we:



| |  |  | change the nominal or par value of our Sanofi-Aventis ordinary shares;
| | - |  | ----------------------------------------------------------------------



| |  |  | recapitalize, reorganize, merge, liquidate, sell assets, or take any similar action;
| | - |  | ------------------------------------------------------------------------------------



| |  |  | reclassify, split up or consolidate any of the deposited securities; or
| | - |  | -----------------------------------------------------------------------



| |  |  | distribute securities on the deposited securities that are not distributed to holders;
| | - |  | --------------------------------------------------------------------------------------



then either:



| |  |  | the cash, shares or other securities received by the depositary will become deposited securities and each Sanofi-Aventis ADS will automatically
represent its equal share of the new deposited securities; or
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the depositary may, and will if we ask it to, distribute some or all of the cash, shares or other securities it receives. It may also deliver new ADRs
or ask holders to surrender their outstanding ADRs in exchange for new ADRs identifying the new deposited securities.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Disclosure of Interests



The obligation of a holder or other person with an interest in our shares to disclose information under French law and under our
statutsalso applies to holders and any other persons with an interest in the Sanofi-Aventis ADSs other than the depositary. The consequences for failure to comply with these provisions will be the same for holders and any other persons with
an interest as a holder of our ordinary shares. For additional information regarding these obligations, see Item 10. Additional Information  B. Memorandum and Articles of Association  Requirements for Holdings Exceeding Certain
Percentages.



Amendment and Termination



We may agree with the depositary to amend the deposit
agreement and the ADRs without consent of the holders for any reason. If the amendment adds or increases fees or charges, except for taxes and other governmental charges or registration fees, cable, telex or facsimile transmission costs, delivery
costs or other such expenses, or prejudices a substantial right of holders of Sanofi-Aventis ADSs, it will only become effective 30 days after the depositary notifies such holders of the amendment. At the time an amendment becomes
effective, such holders will be considered, by continuing to hold their ADR, to have agreed to the amendment and to be bound by the ADR and the deposit agreement as amended.



The depositary will terminate the agreement if we ask it to do so. The depositary may also terminate the
agreement if the depositary has told us that it would like to resign and we have not appointed a new depositary bank within 90 days. In both cases, the depositary must notify holders at least 30 days before termination.



After termination, the depositary and its agents will be
required to do only the following under the deposit agreement: (1) collect distributions on the deposited securities and (2) deliver shares and other deposited securities upon cancellation of ADRs. Six months or more after termination, the
depositary may sell any remaining deposited securities by public or private sale. After that, the depositary will hold the money it received on the sale, as well as any other cash it is holding under the agreement for the pro rata benefit of the
holders of



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Sanofi-Aventis ADSs that have not surrendered their Sanofi-Aventis ADSs. It will have no liability for interest. The depositarys only obligations will be to account for the proceeds of the
sale and other cash and with respect to indemnification. After termination, our only obligation will be with respect to indemnification and to pay certain amounts to the depositary.



Limitations on Obligations and Liability to Holders of Sanofi-Aventis ADSs



The deposit agreement expressly limits our obligations and
the obligations of the depositary, and it limits our liability and the liability of the depositary. We and the depositary:



| |  |  | are obligated only to take the actions specifically set forth in the deposit agreement without gross negligence or bad faith;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------



| |  |  | are not liable if either is prevented or delayed by law or circumstances beyond its control from performing its obligations under the deposit
agreement;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | are not liable if either exercises discretion permitted under the deposit agreement;
| | - |  | ------------------------------------------------------------------------------------



| |  |  | have no obligation to become involved in a lawsuit or other proceeding related to the Sanofi-Aventis ADSs or the deposit agreement on holders
behalf or on behalf of any other party, unless indemnity satisfactory to it against all expense and liability is furnished as often as may be required; and
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | may rely upon any documents it believes in good faith to be genuine and to have been signed or presented by the proper party.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------



In the deposit agreement, we
and the depositary agree to indemnify each other under certain circumstances.



Requirements for Depositary Actions



Before the depositary will deliver or register the transfer of Sanofi-Aventis ADSs, make a distribution on Sanofi-Aventis ADSs or process a withdrawal of shares, the depositary may require:



| |  |  | payment of stock transfer or other taxes or other governmental charges and transfer or registration fees charged by third parties for the transfer of
any shares or other deposited securities;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | production of satisfactory proof of the identity and genuineness of any signature or other information it deems necessary; and
| | - |  | ------------------------------------------------------------------------------------------------------------------------------



| |  |  | compliance with regulations it may establish, from time to time, consistent with the deposit agreement, including presentation of transfer documents.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------



The depositary may refuse to
deliver Sanofi-Aventis ADSs, register transfers of Sanofi-Aventis ADSs or permit withdrawals of shares when the transfer books of the depositary or our transfer books are closed, or at any time if the depositary or we think it advisable to do so.



Right to Receive the Shares Underlying the Sanofi-Aventis ADSs



Holders have the right to cancel their
Sanofi-Aventis ADSs and withdraw the underlying Sanofi-Aventis ordinary shares at any time except:



| |  |  | when temporary delays arise when we or the depositary have closed our transfer books or the deposit of shares in connection with voting at a
shareholders meeting, or the payment of dividends;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | when the holder or other holders of Sanofi-Aventis ADSs seeking to withdraw shares owe money to pay fees, taxes and similar charges; or
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------



| |  |  | when it is necessary to prohibit withdrawals in order to comply with any laws or governmental regulations that apply to Sanofi-Aventis ADSs or to the
withdrawal of shares or other deposited securities.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



This right of withdrawal may not be limited by any other provision of the deposit agreement.



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Pre-Release of Sanofi-Aventis ADSs



Unless we tell the depositary not to, the deposit agreement permits the depositary to deliver Sanofi-Aventis
ADSs before deposit of the underlying shares. This is called a pre-release of the Sanofi-Aventis ADSs. The depositary may also deliver shares upon cancellation of pre-released Sanofi-Aventis ADSs (even if the Sanofi-Aventis ADSs are cancelled before
the pre-release transaction has been closed out). A pre-release is closed out as soon as the underlying shares are delivered to the depositary. The depositary may receive Sanofi-Aventis ADSs instead of shares to close out a pre-release. Unless
otherwise agreed in writing, the depositary may pre-release Sanofi-Aventis ADSs only under the following conditions: (1) before or at the time of the pre-release, the person to whom the pre-release is being made must represent to the depositary
in writing that it or its customer (i) owns the shares or Sanofi-Aventis ADSs to be deposited, (ii) assigns all beneficial rights, title and interest in such shares or ADRs to the depositary and (iii) will not take any action with
respect to such shares or ADRs that is inconsistent with the transfer of beneficial ownership, other than in satisfaction of such pre-release; (2) the pre-release must be fully collateralized with cash, U.S. government securities or other
collateral that the depositary considers appropriate; (3) the depositary must be able to close out the pre-release on not more than five business days notice; and (4) the depositary may require such further indemnities and credit
regulations as it deems appropriate. In addition, the depositary will limit the number of Sanofi-Aventis ADSs that may be outstanding at any time as a result of pre-release, although the depositary may disregard the limit from time to time, if it
thinks it is appropriate to do so. The depositary may retain for its own account any compensation received by it in connection with the foregoing.



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PART II



Item 13. Defaults, Dividend Arrearages
and Delinquencies



N/A



Item 14. Material Modifications to the
Rights of Security Holders



N/A



Item 15. Controls and Procedures



(a) Our Chief Executive Officer and
principal financial officer, after evaluating the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e)) as of the end of the period covered by this Form 20-F, have concluded that, as of such date, our
disclosure controls and procedures were effective to ensure that material information relating to sanofi-aventis was timely made known to them by others within the Group.



(b) Report of Management on Internal Control Over Financial
Reporting



Management of the Company is
responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a  15(f). Management assessed the effectiveness of internal control over financial reporting as of
December 31, 2010 based on the framework in Internal Control  Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).



Based on that assessment, management has concluded that the Companys internal control over financial
reporting was effective as of December 31, 2010 to provide reasonable assurance regarding the reliability of its financial reporting and the preparation of its financial statements for external purposes, in accordance with generally accepted
accounting principles.



Due to its inherent
limitations, internal control over financial reporting may not prevent or detect misstatements, and can only provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements. Also, projections
of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.



The effectiveness of the Companys internal control over
financial reporting has been audited by PricewaterhouseCoopers Audit and Ernst & Young Audit, independent registered public accounting firms, as stated in their report on the Companys internal control over financial reporting as of
December 31, 2010, which is included herein. See paragraph (c) of the present Item 15, below.



(c) See report of PricewaterhouseCoopers Audit and Ernst & Young Audit, independent registered public accounting firms, included under
Item 18. Financial Statements on page F-3.



(d) There were no changes to our internal control over financial reporting that occurred during the period covered by this Form 20-F that have materially affected, or are reasonably likely to materially
affect, our internal control over financial reporting.



Item 16.



[Reserved]



Item 16A. Audit Committee Financial Expert



Our Board of Directors has determined that Klaus Pohle,
Robert Castaigne and Gérard Van Kemmel, directors serving on the Audit Committee, are independent financial experts within the meaning of §407 of the Sarbanes-Oxley Act of 2002. The Board of Directors deemed Klaus Pohle to be a
financial expert taking into account his education and professional experience in financial matters, accountancy and internal control. The Board of Directors determined that Robert Castaigne qualifies as a financial expert based on his education and



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his experience as Chief Financial Officer of a major corporation. The Board of Directors determined that Gérard Van Kemmel qualifies as a financial expert based on his experience as a
partner at an international accounting firm. The Board of Directors has determined that all three directors meet the independence criteria of Rule 10A-3 under the U.S. Securities Exchange Act of 1934, as amended, although only Mr. Pohle and Mr. Van
Kemmel meet the French AFEP-MEDEF criteria of independence applied by the Board of Directors for general corporate governance purposes. (See Item 16.G, below.)



Item 16B. Code of Ethics



We have adopted a financial code of ethics, as defined in
Item 16.B. of Form 20-F under the Exchange Act. Our financial code of ethics applies to our Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer and other officers performing similar functions, as may be designated from
time to time. Our financial code of ethics is available on our Website at www.sanofi-aventis.com (information on our website is not incorporated by reference in this annual report). A copy of our financial code of ethics may also be obtained without
charge by addressing a written request to the attention of Individual Shareholder Relations at our headquarters in Paris. We will disclose any amendment to a waiver of the provisions of such financial code of ethics on our website within 5 business
days of such event.



Item 16C.
Principal Accountants Fees and Services



See Note E. to our consolidated financial statements included at Item 18 of this annual report.



Item 16D. Exemptions from the Listing
Standards for Audit Committees



N/A



Item 16E. Purchases of
Equity Securities by the Issuer and Affiliated Purchasers



In 2010, sanofi-aventis made the following purchases of its ordinary shares.



|              |  |                                     |           |  |                                 |   |       |                                                                                        |  |  |                                                                                    |  |  |   |                |    
|------------- |  | ----------------------------------- | --------- |  | ------------------------------- | - | ----- | -------------------------------------------------------------------------------------- |  |  | ---------------------------------------------------------------------------------- |  |  | - | -------------- | ---
|Period        |  | (a) Total Numberof Shares Purchased |           |  | (b) Average PricePaid per Share |   |       | (c) Total Number of SharesPurchased as Part of
PubliclyAnnounced Plans or Programs (1) |  |  | (d) Approximate Value ofShares
that May Yet BePurchased Under thePlans or Programs | 
|February 2010 |  |                                     | 3,900,000 |  |                                 |  | 53.85 |                                                                                        |  |  | 3,900,000                                                                          |  |  |  | 10,314,188,680 | (1)
|March 2010    |  |                                     | 2,100,000 |  |                                 |  | 56.02 |                                                                                        |  |  | 2,100,000                                                                          |  |  |  | 10,196,546,680 | (1)
|November 2010 |  |                                     | 213,811   |  |                                 |  | 48.02 |                                                                                        |  |  | 213,811                                                                            |  |  |  | 10,537,565,195 | (2)
|December 2010 |  |                                     | 536,485   |  |                                 |  | 48.67 |                                                                                        |  |  | 536,485                                                                            |  |  |  | 10,511,454,470 | (2)





|(1) | The Company was authorized to repurchase its shares under the
480 million share repurchase program established by the Chief Executive Officer of the Company on February 11, 2010 in implementation of the shareholders resolution adopted at the Annual Shareholders Meeting of April 17,
2009 for a period of eighteen months (i.e., through October 16, 2010) authorizing the repurchase of up to 10,524,203,680 of shares for a period of eighteen months (i.e., through October 16, 2010). This authorization was replaced by a
resolution adopted by the Annual Shareholders Meeting held on May 17, 2010 authorizing the repurchase of up to 10,547,832,400 of shares for a period of eighteen months (i.e., through November 16, 2011).
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | These repurchases of shares have been made in application of a liquidity contract
entered into between the Company and Exane BNP Paribas for the period running from September 16, 2010 to December 31, 2010. This contract provides for an endowment of 40 million for market making activities, of which
20 million have been made available. The liquidity contract was entered into in implementation of the shareholders resolution adopted at the Annual Shareholders Meeting of May 17, 2010 authorizing the repurchase of up to
10,547,832,400 of shares for a period of eighteen months (i.e., through November 16, 2011).
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Item 16F. Change in Registrants Certifying Accountant



N/A



Item 16G. Corporate Governance



Sanofi-aventis is incorporated under the laws of France, with securities listed on regulated public markets in
the United States (New York Stock Exchange) and France (Euronext Paris). Consequently, as described further at Item 6. Directors, Senior Management and Employees  C. Board practices hereof, our corporate governance framework
reflects the mandatory provisions of French corporate law, the securities laws and regulations of



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France and the United States and the rules of the aforementioned public markets. In addition, we generally follow the so-called AFEP-MEDEF corporate governance recommendations for
French listed issuers. As a result, our corporate governance framework is similar in many respects to, and provides investor protections that are comparable to  or in some cases, more stringent than  the corresponding rules of the New
York Stock Exchange. Nevertheless, there are important differences to keep in mind.



In line with New York Stock Exchange rules applicable to domestic issuers, sanofi-aventis maintains a board of directors at least half of the members of which are independent. Sanofi-aventis evaluates the
independence of members of our Board of Directors using the standards of the French AFEP-MEDEF corporate governance recommendations as the principal reference. We believe that AFEP-MEDEFs overarching criteria for independence  no
relationship of any kind whatsoever with the Company, its group or the management of either that is such as to color a Board members judgment  are on the whole consistent with the goals of the New York Stock Exchanges rules
although the specific tests proposed under the two standards may vary on some points. We note that under AFEP-MEDEF rules, our non-executive Chairman of the Board has automatically been classified as non-independent although he has no relationship
with Sanofi-Aventis that would cause him to be non-independent under the rules of the New York Stock Exchange. Additionally, we have complied with the audit committee independence and other requirements of the Rule 10A-3 under the U.S. Securities
Exchange Act of 1934, as amended, adopted pursuant to the Sarbanes-Oxley Act of 2002. Our Compensation Committee includes non-independent members, which is permitted under the AFEP-MEDEF rules, but would not be compliant with the rules of the New
York Stock Exchange for domestic issuers.



Under
French law, the committees of our Board of Directors are advisory only, and where the New York Stock Exchange Listed Company Manual would vest certain decision-making powers with specific committees by delegation (e.g., nominating or audit
committees), our Board of Directors remains under French law the only competent body to take such decisions, albeit taking into account the recommendation of the relevant committees. Additionally, under French corporate law, it is the shareholder
meeting of sanofi-aventis that is competent to appoint our auditors upon the proposal of our Board of Directors, although our internal rules provide that the Board of Directors will make its proposal on the basis of the recommendation of our Audit
Committee. We believe that this requirement of French law, together with the additional legal requirement that two sets of statutory auditors be appointed, share the New York Stock Exchanges underlying goal of ensuring that the audit of our
accounts be conducted by auditors independent from company management.



In addition to the oversight role of our Compensation Committee for questions of management compensation including by way of equity, under French law any option plans or other share capital increases,
whether for the benefit of top management or employees, may only be adopted by the Board of Directors pursuant to and within the limits of a shareholder resolution approving the related capital increase and delegating to the Board the authority to
implement such operations.



As described above, a
number of issues, which could be resolved directly by a board or its committees in the United States, require the additional protection of direct shareholder consultation in France. On the other hand, there is not a tradition of non-executive Board
of Director sessions. Our audit committee is entirely composed of independent directors as that term is defined in Rule 10A-3 under the U.S. Securities Exchange Act of 1934, as amended, adopted pursuant to the Sarbanes-Oxley Act of 2002. The
composition of our Audit Committee, Compensation Committee, and Appointments and Governance Committee includes directors who are also officers or recently retired officers of our principal shareholders.



As a foreign private issuer under the U.S.
securities laws, our Chief Executive Officer and our Chief Financial Officer issue the certifications required by §302 and §906 of the Sarbanes Oxley Act of 2002 on an annual basis (with the filing of our annual report on U.S. Form 20-F)
rather than on a quarterly basis as would be the case of a U.S. corporation filing quarterly reports on U.S. Form 10-Q.



French corporate law provides that the Board of Directors must vote to approve a broadly defined range of transactions that could
potentially create conflicts of interest between sanofi-aventis on the one hand and its directors and Chief Executive Officer on the other hand, with these transactions then being presented to our shareholders at the following annual general
meeting. This legal safeguard provides shareholders with an opportunity to approve significant aspects of the Chief Executive Officers compensation package even in the absence of say on pay legislation in France, and it operates in
place of certain provisions of the NYSE Listed Company Manual.



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##### Table of Contents

PART III



Item 17. Financial Statements



See Item 18.



Item 18. Financial Statements



See pages F-1 through F-126 incorporated
herein by reference.



Item 19.
Exhibits



| |      |  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | ---- |  |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     
| | 1.1  |  |  | Articles of association (statuts) of sanofi-aventis (English translation)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     
| | 1.2  |  |  | Board Charter (Règlement Intérieur) of sanofi-aventis (English translation)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |     
| | 2.1  |  |  | Form of Deposit Agreement between sanofi-aventis and JPMorgan Chase Bank, N.A., as depositary (incorporated herein by reference to Exhibit A to the Registration Statement on
Form F-6 dated August 7, 2007 relating to our American Depositary Shares, SEC File No. 333-145177)                                                                                                                                                                                                                                                                            
| |     
| | 2.2  |  |  | Instrument defining rights of holders of American Depositary Shares each representing one quarter of a Participating Share Series A (incorporated by reference to Item. 3
Exhibit (a) of the Registration Statement on Form F-6 (Registration No. 33-31904) dated November 21, 1989)                                                                                                                                                                                                                                                                        
| |     
| | 4.1  |  |  | Facilities Agreement, dated October 2, 2010, by and among Sanofi-Aventis, BNP Paribas, J.P. Morgan plc and Société Générale Corporate & Investment
Banking acting as Initial Mandated Lead Arrangers, Société Générale acting as Facilities Agent, the Companies listed as Additional Borrowers thereto and the Financial Institutions included as Lenders therein.
(incorporated by reference to Item. 12 Exhibit (b)(A) of the Tender Offer Statement on Schedule TO filed on October 4, 2010.)                                                           
| |     
| | 4.2  |  |  | Amendment dated February 15, 2011 to the Facilities Agreement, dated October 2, 2010, by and among Sanofi-Aventis, BNP Paribas, J.P. Morgan plc and Société
Générale Corporate & Investment Banking acting as Initial Mandated Lead Arrangers, Société Générale acting as Facilities Agent, the Companies listed as Additional Borrowers thereto and the Financial
Institutions included as Lenders therein. (incorporated by reference to Item. 12 Exhibit(b)(B)of Amendment No. 15 to the Tender Offer Statement on Schedule TOfiled on February 16, 2011)
| |     
| | 4.3  |  |  | Agreement and Plan of Merger, dated as of February 16, 2011, among Sanofi-Aventis, GC Merger Corp., and Genzyme Corporation (incorporated by reference to Item. 12
Exhibit(d)(1) of Amendment No. 15 to the Tender Offer Statement on Schedule TO filed on February 16, 2011)                                                                                                                                                                                                                                                                               
| |     
| | 4.4  |  |  | Form of Contingent Value Rights Agreement by and among Sanofi and Trustee (incorporated by reference to Item. 12 Exhibit(d)(2) of
Amendment No. 15 to the Tender Offer Statement on Schedule TO filed on February 16, 2011)                                                                                                                                                                                                                                                                                                                                 
| |     
| | 8.1  |  |  | List of significant subsidiaries, see Item 4. Information on the Company  C. Organizational Structure of this 20-F.                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |     
| | 12.1 |  |  | Certification by Christopher Viehbacher, Chief Executive Officer, required by Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |     
| | 12.2 |  |  | Certification by Jérôme Contamine, Principal Financial Officer, required by Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     
| | 13.1 |  |  | Certification by Christopher Viehbacher, Chief Executive Officer, required by Section 906 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |     
| | 13.2 |  |  | Certification by Jérôme Contamine, Principal Financial Officer, required by Section 906 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     
| | 23.1 |  |  | Consent of Ernst & Young Audit dated February 25, 2011                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |     
| | 23.2 |  |  | Consent of PricewaterhouseCoopers Audit dated February 28, 2011                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     
| | 99.1 |  |  | Report of the Chairman of the Board of Directors for 2010 as required by Art. L. 225-37 paragraph 6 of the French Commercial Code                                                                                                                                                                                                                                                                                                                                                                                                                           



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Signatures



The registrant hereby certifies that it meets all of the
requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.



sanofi-aventisby:

/s/    CHRISTOPHER
VIEHBACHERChristopher Viehbacher Chief Executive Officer




Date: February 28, 2011



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##### Table of Contents

ANNUAL CONSOLIDATED FINANCIAL STATEMENTS



The financial statements are presented in accordance with

International Financial Reporting Standards (IFRS)



|                                                                                                        |  |  |               | 
|------------------------------------------------------------------------------------------------------- |  |  | ------------- | 
|REPORTS OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMS                                               |  |  | F-2 - F-3     | 
|                                                                                                        | 
|CONSOLIDATED BALANCE SHEETS                                                                             |  |  | F-4 - F-5     | 
|                                                                                                        | 
|CONSOLIDATED INCOME STATEMENTS                                                                          |  |  | F-6           | 
|                                                                                                        | 
|CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME                                                         |  |  | F-7           | 
|                                                                                                        | 
|CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY                                                            |  |  | F-8           | 
|                                                                                                        | 
|CONSOLIDATED STATEMENTS OF CASH FLOWS                                                                   |  |  | F-9           | 
|                                                                                                        | 
|NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                                                          |  |  | F-10          | 
|                                                                                                        | 
| A. Basis of preparation                                                                               |  |  | F-10 - F-11   | 
|                                                                                                        | 
| B. Summary of significant accounting policies                                                         |  |  | F-12 - F-34   | 
|                                                                                                        | 
| C. Alliances                                                                                          |  |  | F-35 - F-36   | 
|                                                                                                        | 
| D. Detailed notes to the financial statements                                                         |  |  | F-37 - F-119  | 
|                                                                                                        | 
| E. Principal Accountants Fees and Services                                                           |  |  | F-120         | 
|                                                                                                        | 
| F. List of principal companies included in the consolidation for the year ended   
 December 31, 2010 |  |  | F-121 - F-126 | 



F-1



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##### Table of Contents

REPORT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRMS



SANOFI-AVENTIS



To the Board of Directors and Shareholders of sanofi-aventis,



We have audited the accompanying consolidated balance sheets of sanofi-aventis and its subsidiaries (together the Group) as of
December 31, 2010, 2009 and 2008, and the related consolidated statements of income, comprehensive income, changes in equity and cash flows for each of the three years in the period ended December 31, 2010. These financial statements
are the responsibility of the Groups management. Our responsibility is to express an opinion on these financial statements based on our audits.



We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States), (the
PCAOB). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.



In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated
financial position of the Group as of December 31, 2010, 2009 and 2008, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2010, in conformity with International
Financial Reporting Standards as issued by the International Accounting Standards Board.



We also have audited, in accordance with the standards of the PCAOB, the effectiveness of the Groups internal control over financial reporting as of December 31, 2010, based on criteria
established in Internal Control  Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 25, 2011 expressed an unqualified opinion thereon.



Neuilly-sur-Seine and Paris-La Défense, February 25, 2011



|                             |  |                     |  |  |  | 
|---------------------------- |  | ------------------- |  |  |  | 
|PricewaterhouseCoopers Audit |  | Ernst & Young Audit



|                |  |               |  |                      |  |                
|--------------- |  | ------------- |  | -------------------- |  | ---------------
|Xavier Cauchois |  | Philippe Vogt |  | Christian Chiarasini |  | Jacques Pierres



F-2



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##### Table of Contents

REPORT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRMS



SANOFI-AVENTIS



To the Board of Directors and Shareholders of sanofi-aventis,



We have audited internal control over financial reporting of sanofi-aventis and its subsidiaries (together
the Group) as of December 31, 2010, based on criteria established in Internal Control  Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). The Groups
management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Report of Management on Internal
Control Over Financial Reporting. Our responsibility is to express an opinion on the companys internal control over financial reporting based on our audit.



We conducted our audit in accordance with the standards of
the Public Company Accounting Oversight Board (United States), (the PCAOB). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was
maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of
internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.



A companys internal control over financial reporting is
a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A companys
internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the
company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company
are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the
companys assets that could have a material effect on the financial statements.



Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject
to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.



In our opinion, the Group maintained, in all material
respects, effective internal control over financial reporting as of December 31, 2010, based on the COSO criteria.



We also have audited, in accordance with the standards of the PCAOB, the consolidated balance sheets of the Group as of December 31,
2010, 2009 and 2008, and the related consolidated statements of income, comprehensive income, changes in equity and cash flows for each of the three years in the period ended December 31, 2010 and our report dated February 25, 2011
expressed an unqualified opinion thereon.



Neuilly-sur-seine and
Paris-La Défense, February 25, 2011



|                             |  |                     |  |                      |  |                
|---------------------------- |  | ------------------- |  | -------------------- |  | ---------------
|PricewaterhouseCoopers Audit |  | Ernst & Young Audit
|                             |  |                     | 
|Xavier Cauchois              |  | Philippe Vogt       |  | Christian Chiarasini |  | Jacques Pierres



F-3



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##### Table of Contents

CONSOLIDATED BALANCE SHEETS



|                                             |  |             |  |                  |        |  |                      |  |        |                  |  |  |        | 
|-------------------------------------------- |  | ----------- |  | ---------------- | ------ |  | -------------------- |  | ------ | ---------------- |  |  | ------ | 
|( million)                                  |  | Note        |  | December 31,2010 |        |  | December 31,2009
(1) |  |        | December 31,2008 | 
|ASSETS                                       |  |             |  |                  |        |  |                      |  |        |                  |  |  |        | 
|Property, plant and equipment                |  | D.3.        |  |                  | 8,155  |  |                      |  | 7,830  |                  |  |  | 6,961  | 
|Goodwill                                     |  | D.4.        |  |                  | 31,932 |  |                      |  | 29,733 |                  |  |  | 28,163 | 
|Other intangible assets                      |  | D.4.        |  |                  | 12,479 |  |                      |  | 13,747 |                  |  |  | 15,260 | 
|Investments in associates and joint ventures |  | D.6.        |  |                  | 924    |  |                      |  | 955    |                  |  |  | 2,459  | 
|Non-current financial assets                 |  | D.7.        |  |                  | 1,644  |  |                      |  | 998    |                  |  |  | 821    | 
|Deferred tax assets                          |  | D.14.       |  |                  | 3,051  |  |                      |  | 2,912  |                  |  |  | 2,920  | 
|Non-current assets                           |  |             |  |                  | 58,185 |  |                      |  | 56,175 |                  |  |  | 56,584 | 
|Inventories                                  |  | D.9.        |  |                  | 5,020  |  |                      |  | 4,444  |                  |  |  | 3,590  | 
|Accounts receivable                          |  | D.10.       |  |                  | 6,507  |  |                      |  | 6,015  |                  |  |  | 5,303  | 
|Other current assets                         |  | D.11.       |  |                  | 2,000  |  |                      |  | 2,104  |                  |  |  | 1,881  | 
|Current financial assets                     |  | D.12.       |  |                  | 51     |  |                      |  | 277    |                  |  |  | 403    | 
|Cash and cash equivalents                    |  | D.13./D.17. |  |                  | 6,465  |  |                      |  | 4,692  |                  |  |  | 4,226  | 
|Current assets                               |  |             |  |                  | 20,043 |  |                      |  | 17,532 |                  |  |  | 15,403 | 
|Assets held for sale or exchange             |  | D.8.        |  |                  | 7,036  |  |                      |  | 6,544  |                  |  |  |       | 
|TOTAL ASSETS                                 |  |             |  |                  | 85,264 |  |                      |  | 80,251 |                  |  |  | 71,987 | 



|(1) | In
accordance with IFRS 3 (Business Combinations), sanofi-aventis adjusted the values of certain identifiable assets and liabilities of Merial during the purchase price allocation period (see Note D.1.).
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The accompanying notes on pages F-10 to F-126 are an integral
part of the consolidated financial statements.



F-4



---

##### Table of Contents

CONSOLIDATED BALANCE SHEETS



|                                                                                          |  |      |         |  |                  |  |        |                      |  |  |                  |  |  |  |        | 
|----------------------------------------------------------------------------------------- |  | ---- | ------- |  | ---------------- |  | ------ | -------------------- |  |  | ---------------- |  |  |  | ------ | 
|( million)                                                                               |  | Note |         |  | December 31,2010 |  |        | December 31,2009
(1) |  |  | December 31,2008 | 
|LIABILITIES & EQUITY                                                                      |  |      |         |  |                  |  |        |                      |  |  |                  |  |  |  |        | 
|Equity attributable to equity holders of sanofi-aventis                                   |  |      | D.15.   |  |                  |  | 53,097 |                      |  |  | 48,322           |  |  |  | 44,866 | 
|Equity attributable to non-controlling interests                                          |  |      | D.16.   |  |                  |  | 191    |                      |  |  | 258              |  |  |  | 205    | 
|Total equity                                                                              |  |      |         |  |                  |  | 53,288 |                      |  |  | 48,580           |  |  |  | 45,071 | 
|Long-term debt                                                                            |  |      | D.17.   |  |                  |  | 6,695  |                      |  |  | 5,961            |  |  |  | 4,173  | 
|Non-current liabilities related to business combinations and to non-controlling interests |  |      | D.18.   |  |                  |  | 388    |                      |  |  | 75               |  |  |  |       | 
|Provisions and other non-current liabilities                                              |  |      | D.19.   |  |                  |  | 9,326  |                      |  |  | 8,236            |  |  |  | 7,730  | 
|Deferred tax liabilities                                                                  |  |      | D.14.   |  |                  |  | 3,808  |                      |  |  | 4,933            |  |  |  | 5,668  | 
|Non-current liabilities                                                                   |  |      |         |  |                  |  | 20,217 |                      |  |  | 19,205           |  |  |  | 17,571 | 
|Accounts payable                                                                          |  |      |         |  |                  |  | 2,800  |                      |  |  | 2,654            |  |  |  | 2,791  | 
|Other current liabilities                                                                 |  |      | D.19.4. |  |                  |  | 5,624  |                      |  |  | 5,369            |  |  |  | 4,721  | 
|Current liabilities related to business combinations and to non-controlling interests     |  |      | D.18.   |  |                  |  | 98     |                      |  |  | 76               |  |  |  |       | 
|Short-term debt and current portion of long-term debt                                     |  |      | D.17.   |  |                  |  | 1,565  |                      |  |  | 2,866            |  |  |  | 1,833  | 
|Current liabilities                                                                       |  |      |         |  |                  |  | 10,087 |                      |  |  | 10,965           |  |  |  | 9,345  | 
|Liabilities related to assets held for sale or exchange                                   |  |      | D.8.    |  |                  |  | 1,672  |                      |  |  | 1,501            |  |  |  |       | 
|TOTAL LIABILITIES & EQUITY                                                                |  |      |         |  |                  |  | 85,264 |                      |  |  | 80,251           |  |  |  | 71,987 | 



|(1) | In
accordance with IFRS 3 (Business Combinations), sanofi-aventis adjusted the values of certain identifiable assets and liabilities of Merial during the purchase price allocation period (see Note D.1.).
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The accompanying notes on pages F-10 to F-126 are an integral
part of the consolidated financial statements.



F-5



---

##### Table of Contents

CONSOLIDATED INCOME STATEMENTS



|                                                               |  |             |  |                            |         |   |                            |  |         |                            |  |  |         |  
|-------------------------------------------------------------- |  | ----------- |  | -------------------------- | ------- | - | -------------------------- |  | ------- | -------------------------- |  |  | ------- | -
|( million)                                                    |  | Note        |  | Year endedDecember 31,2010 |         |   | Year endedDecember 31,2009 |  |         | Year endedDecember 31,2008 | 
|Net sales                                                      |  | D.34./D.35. |  |                            | 30,384  |   |                            |  | 29,306  |                            |  |  | 27,568  |  
|Other revenues                                                 |  |             |  |                            | 1,651   |   |                            |  | 1,443   |                            |  |  | 1,249   |  
|Cost of sales                                                  |  |             |  |                            | (8,717  | ) |                            |  | (7,880  | )                          |  |  | (7,337  | )
|Gross profit                                                   |  |             |  |                            | 23,318  |   |                            |  | 22,869  |                            |  |  | 21,480  |  
|Research and development expenses                              |  |             |  |                            | (4,401  | ) |                            |  | (4,583  | )                          |  |  | (4,575  | )
|Selling and general expenses                                   |  |             |  |                            | (7,567  | ) |                            |  | (7,325  | )                          |  |  | (7,168  | )
|Other operating income                                         |  | D.25.       |  |                            | 359     |   |                            |  | 866     |                            |  |  | 556     |  
|Other operating expenses                                       |  | D.26.       |  |                            | (276    | ) |                            |  | (481    | )                          |  |  | (353    | )
|Amortization of intangible assets                              |  |             |  |                            | (3,529  | ) |                            |  | (3,528  | )                          |  |  | (3,483  | )
|Impairment of intangible assets                                |  | D.5.        |  |                            | (433    | ) |                            |  | (372    | )                          |  |  | (1,554  | )
|Restructuring costs                                            |  | D.27.       |  |                            | (1,372  | ) |                            |  | (1,080  | )                          |  |  | (585    | )
|Gains and losses on disposals, and litigation                  |  | D.28.       |  |                            | (138    | ) |                            |  |        |                            |  |  | 76      |  
|Operating income                                               |  |             |  |                            | 5,961   |   |                            |  | 6,366   |                            |  |  | 4,394   |  
|Financial expenses                                             |  | D.29.       |  |                            | (467    | ) |                            |  | (324    | )                          |  |  | (335    | )
|Financial income                                               |  | D.29.       |  |                            | 105     |   |                            |  | 24      |                            |  |  | 103     |  
|Income before tax and associates and joint ventures            |  |             |  |                            | 5,599   |   |                            |  | 6,066   |                            |  |  | 4,162   |  
|Income tax expense                                             |  | D.30.       |  |                            | (1,242  | ) |                            |  | (1,364  | )                          |  |  | (682    | )
|Share of profit/loss of associates and joint ventures          |  | D.31.       |  |                            | 978     |   |                            |  | 814     |                            |  |  | 692     |  
|Net income excluding the held-for-exchange Merial business
(1) |  |             |  |                            | 5,335   |   |                            |  | 5,516   |                            |  |  | 4,172   |  
|Net income from the held-for-exchange Merial business(1)       |  | D.8.        |  |                            | 386     |   |                            |  | 175     |                            |  |  | 120     |  
|Net income                                                     |  |             |  |                            | 5,721   |   |                            |  | 5,691   |                            |  |  | 4,292   |  
|Net income attributable to non-controlling interests           |  | D.32.       |  |                            | 254     |   |                            |  | 426     |                            |  |  | 441     |  
|Net income attributable to equity holders of sanofi-aventis    |  |             |  |                            | 5,467   |   |                            |  | 5,265   |                            |  |  | 3,851   |  
|Average number of shares outstanding (million)                 |  | D.15.9.     |  |                            | 1,305.3 |   |                            |  | 1,305.9 |                            |  |  | 1,309.3 |  
|Average number of shares outstanding after dilution (million)  |  | D.15.9.     |  |                            | 1,308.2 |   |                            |  | 1,307.4 |                            |  |  | 1,310.9 |  
| Basic earnings per share (in euros)                          |  |             |  |                            | 4.19    |   |                            |  | 4.03    |                            |  |  | 2.94    |  
| Diluted earnings per share (in euros)                        |  |             |  |                            | 4.18    |   |                            |  | 4.03    |                            |  |  | 2.94    |  



|(1) | Reported separately in accordance
with IFRS 5 (Non-Current Assets Held for Sale and Discontinued Operations). For the other disclosures required under IFRS 5, refer to Note D.8. to our consolidated financial statements.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The accompanying notes on pages F-10 to F-126 are an integral
part of the consolidated financial statements.



F-6



---

##### Table of Contents

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME



|                                                                     |  |                            |       |   |                                |  |       |                            |  |  |       |  
|-------------------------------------------------------------------- |  | -------------------------- | ----- | - | ------------------------------ |  | ----- | -------------------------- |  |  | ----- | -
|( million)                                                          |  | Year endedDecember 31,2010 |       |   | Year endedDecember 31,2009
(1) |  |       | Year endedDecember 31,2008 | 
|Net income                                                           |  |                            | 5,721 |   |                                |  | 5,691 |                            |  |  | 4,292 |  
|Attributable to equity holders of sanofi-aventis                     |  |                            | 5,467 |   |                                |  | 5,265 |                            |  |  | 3,851 |  
|Attributable to non-controlling interests                            |  |                            | 254   |   |                                |  | 426   |                            |  |  | 441   |  
|Income (expense) recognized directly in equity:                      |  |                            |       |   |                                |  |       |                            |  |  |       |  
| Available-for-sale financial assets                                |  |                            | 141   |   |                                |  | 110   |                            |  |  | (132  | )
| Cash flow hedges                                                   |  |                            | 17    |   |                                |  | (175  | )                          |  |  | 104   |  
| Remeasurement of previously-held equity interests:                 |  |                            |       |   |                                |  |       |                            |  |  |       |  
| Merial (50%)(2)                                                    |  |                            |      |   |                                |  | 1,379 |                            |  |  |      |  
| Zentiva (24.9%)                                                    |  |                            |      |   |                                |  | 108   |                            |  |  |      |  
| Actuarial gains/(losses)                                           |  |                            | (311  | ) |                                |  | (169  | )                          |  |  | (829  | )
| Change in cumulative translation difference                        |  |                            | 2,654 |   |                                |  | (298  | )                          |  |  | 948   |  
| Tax effect of income and expenses recognized directly in equity(3) |  |                            | 152   |   |                                |  | (274  | )                          |  |  | 132   |  
|Total income/(expense) recognized directly in equity                 |  |                            | 2,653 |   |                                |  | 681   |                            |  |  | 223   |  
|Total recognized income/(expense) for the period                     |  |                            | 8,374 |   |                                |  | 6,372 |                            |  |  | 4,515 |  
|Attributable to equity holders of sanofi-aventis                     |  |                            | 8,109 |   |                                |  | 5,945 |                            |  |  | 4,090 |  
|Attributable to non-controlling interests                            |  |                            | 265   |   |                                |  | 427   |                            |  |  | 425   |  



|(1) | In
accordance with IFRS 3 (Business Combinations), sanofi-aventis adjusted the values of certain identifiable assets and liabilities of Merial during the purchase price allocation period (see Note D.1.).
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Representing $2,029 million
(equivalent to $1,551 million net of taxes) at the end of the purchase price allocation period (see Note D.1.), including a retrospective adjustment of $242 million following valuation adjustments to certain identifiable assets and liabilities.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | See analysis in Note D.15.7.
|--- | ----------------------------



The accompanying notes on pages F-10 to F-126 are an integral
part of the consolidated financial statements.



F-7



---

##### Table of Contents

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY



|                                                                     |  |              |       |   |                                              |  |        |                |  |  |                                          |   |  |                                           |       |   |                                                 |  |        |                                         |  |  |             |   |  |  |      |   |  |  |        |  
|-------------------------------------------------------------------- |  | ------------ | ----- | - | -------------------------------------------- |  | ------ | -------------- |  |  | ---------------------------------------- | - |  | ----------------------------------------- | ----- | - | ----------------------------------------------- |  | ------ | --------------------------------------- |  |  | ----------- | - |  |  | ---- | - |  |  | ------ | -
|( million)                                                          |  | Sharecapital |       |   | Additionalpaid-incapital andretainedearnings |  |        | Treasuryshares |  |  | Stock optionsand othershare-basedpayment |   |  | Otheritemsrecognizeddirectly inequity (1) |       |   | Attributable toequity
holdersof sanofi- aventis |  |        | Attributable tonon-controllinginterests |  |  | Totalequity |  
|Balance at January 1, 2008                                           |  |              | 2,732 |   |                                              |  | 47,162 |                |  |  | (2,275                                   | ) |  |                                           | 1,468 |   |                                                 |  | (4,545 | )                                       |  |  | 44,542      |   |  |  | 177  |   |  |  | 44,719 |  
|Income/(expense) recognized directly in equity                       |  |              |      |   |                                              |  | (693   | )              |  |  |                                         |   |  |                                           |      |   |                                                 |  | 932    |                                         |  |  | 239         |   |  |  | (16  | ) |  |  | 223    |  
|Net income for the period                                            |  |              |      |   |                                              |  | 3,851  |                |  |  |                                         |   |  |                                           |      |   |                                                 |  |       |                                         |  |  | 3,851       |   |  |  | 441  |   |  |  | 4,292  |  
|Total recognized income/(expense) for the period                     |  |              |      |   |                                              |  | 3,158  |                |  |  |                                         |   |  |                                           |      |   |                                                 |  | 932    |                                         |  |  | 4,090       |   |  |  | 425  |   |  |  | 4,515  |  
|Dividend paid out of 2007 earnings (2.07 per share)                 |  |              |      |   |                                              |  | (2,702 | )              |  |  |                                         |   |  |                                           |      |   |                                                 |  |       |                                         |  |  | (2,702      | ) |  |  |     |   |  |  | (2,702 | )
|Payment of dividends and equivalents to non-controlling interests    |  |              |      |   |                                              |  |       |                |  |  |                                         |   |  |                                           |      |   |                                                 |  |       |                                         |  |  |            |   |  |  | (397 | ) |  |  | (397   | )
|Share repurchase program                                             |  |              |      |   |                                              |  |       |                |  |  | (1,227                                   | ) |  |                                           |      |   |                                                 |  |       |                                         |  |  | (1,227      | ) |  |  |     |   |  |  | (1,227 | )
|Reduction in share capital                                           |  |              | (103  | ) |                                              |  | (2,843 | )              |  |  | 2,946                                    |   |  |                                           |      |   |                                                 |  |       |                                         |  |  |            |   |  |  |     |   |  |  |       |  
|Share-based payment:                                                 |  |              |       |   |                                              |  |        |                |  |  |                                          |   |  |                                           |       |   |                                                 |  |        |                                         |  |  |             |   |  |  |      |   |  |  |        |  
| Exercise of stock options                                          |  |              | 2     |   |                                              |  | 37     |                |  |  |                                         |   |  |                                           |      |   |                                                 |  |       |                                         |  |  | 39          |   |  |  |     |   |  |  | 39     |  
| Proceeds from sale of treasury shares on exercise of stock options |  |              |      |   |                                              |  |       |                |  |  | 4                                        |   |  |                                           |      |   |                                                 |  |       |                                         |  |  | 4           |   |  |  |     |   |  |  | 4      |  
| Value of services obtained from employees                          |  |              |      |   |                                              |  |       |                |  |  |                                         |   |  |                                           | 125   |   |                                                 |  |       |                                         |  |  | 125         |   |  |  |     |   |  |  | 125    |  
| Tax effect of exercise of stock options                            |  |              |      |   |                                              |  |       |                |  |  |                                         |   |  |                                           | (12   | ) |                                                 |  |       |                                         |  |  | (12         | ) |  |  |     |   |  |  | (12    | )
|Other movements                                                      |  |              |      |   |                                              |  | 7      |                |  |  |                                         |   |  |                                           |      |   |                                                 |  |       |                                         |  |  | 7           |   |  |  |     |   |  |  | 7      |  
|Balance at December 31, 2008                                         |  |              | 2,631 |   |                                              |  | 44,819 |                |  |  | (552                                     | ) |  |                                           | 1,581 |   |                                                 |  | (3,613 | )                                       |  |  | 44,866      |   |  |  | 205  |   |  |  | 45,071 |  
|Income/(expense) recognized directly in equity (3)                   |  |              |      |   |                                              |  | 1,000  |                |  |  |                                         |   |  |                                           |      |   |                                                 |  | (320   | )                                       |  |  | 680         |   |  |  | 1    |   |  |  | 681    |  
|Net income for the period                                            |  |              |      |   |                                              |  | 5,265  |                |  |  |                                         |   |  |                                           |      |   |                                                 |  |       |                                         |  |  | 5,265       |   |  |  | 426  |   |  |  | 5,691  |  
|Total recognized income/(expense) for the period (3)                 |  |              |      |   |                                              |  | 6,265  |                |  |  |                                         |   |  |                                           |      |   |                                                 |  | (320   | )                                       |  |  | 5,945       |   |  |  | 427  |   |  |  | 6,372  |  
|Dividend paid out of 2008 earnings (2.20 per share)                 |  |              |      |   |                                              |  | (2,872 | )              |  |  |                                         |   |  |                                           |      |   |                                                 |  |       |                                         |  |  | (2,872      | ) |  |  |     |   |  |  | (2,872 | )
|Payment of dividends and equivalents to non-controlling interests    |  |              |      |   |                                              |  |       |                |  |  |                                         |   |  |                                           |      |   |                                                 |  |       |                                         |  |  |            |   |  |  | (418 | ) |  |  | (418   | )
|Share-based payment:                                                 |  |              |       |   |                                              |  |        |                |  |  |                                          |   |  |                                           |       |   |                                                 |  |        |                                         |  |  |             |   |  |  |      |   |  |  |        |  
| Exercise of stock options                                          |  |              | 6     |   |                                              |  | 134    |                |  |  |                                         |   |  |                                           |      |   |                                                 |  |       |                                         |  |  | 140         |   |  |  |     |   |  |  | 140    |  
| Proceeds from sale of treasury shares on exercise of stock options |  |              |      |   |                                              |  |       |                |  |  | 26                                       |   |  |                                           |      |   |                                                 |  |       |                                         |  |  | 26          |   |  |  |     |   |  |  | 26     |  
| Value of services obtained from employees                          |  |              |      |   |                                              |  |       |                |  |  |                                         |   |  |                                           | 114   |   |                                                 |  |       |                                         |  |  | 114         |   |  |  |     |   |  |  | 114    |  
| Tax effect of exercise of stock options                            |  |              |      |   |                                              |  |       |                |  |  |                                         |   |  |                                           | 1     |   |                                                 |  |       |                                         |  |  | 1           |   |  |  |     |   |  |  | 1      |  
|Non-controlling interests generated by acquisitions                  |  |              |      |   |                                              |  |       |                |  |  |                                         |   |  |                                           |      |   |                                                 |  |       |                                         |  |  |            |   |  |  | 49   |   |  |  | 49     |  
|Changes in non-controlling interests without loss of control         |  |              |      |   |                                              |  |       |                |  |  |                                         |   |  |                                           |      |   |                                                 |  |       |                                         |  |  |            |   |  |  | (5   | ) |  |  | (5     | )
|Step acquisitions(2)                                                 |  |              |      |   |                                              |  | 102    |                |  |  |                                         |   |  |                                           |      |   |                                                 |  |       |                                         |  |  | 102         |   |  |  |     |   |  |  | 102    |  
|Balance at December 31, 2009 (3)                                     |  |              | 2,637 |   |                                              |  | 48,448 |                |  |  | (526                                     | ) |  |                                           | 1,696 |   |                                                 |  | (3,933 | )                                       |  |  | 48,322      |   |  |  | 258  |   |  |  | 48,580 |  
|Income/(expense) recognized directly in equity                       |  |              |      |   |                                              |  | (139   | )              |  |  |                                         |   |  |                                           |      |   |                                                 |  | 2,781  |                                         |  |  | 2,642       |   |  |  | 11   |   |  |  | 2,653  |  
|Net income for the period                                            |  |              |      |   |                                              |  | 5,467  |                |  |  |                                         |   |  |                                           |      |   |                                                 |  |       |                                         |  |  | 5,467       |   |  |  | 254  |   |  |  | 5,721  |  
|Total recognized income/(expense) for the period                     |  |              |      |   |                                              |  | 5,328  |                |  |  |                                         |   |  |                                           |      |   |                                                 |  | 2,781  |                                         |  |  | 8,109       |   |  |  | 265  |   |  |  | 8,374  |  
|Dividend paid out of 2009 earnings (2.40 per share)                 |  |              |      |   |                                              |  | (3,131 | )              |  |  |                                         |   |  |                                           |      |   |                                                 |  |       |                                         |  |  | (3,131      | ) |  |  |     |   |  |  | (3,131 | )
|Payment of dividends and equivalents to non-controlling interests    |  |              |      |   |                                              |  |       |                |  |  |                                         |   |  |                                           |      |   |                                                 |  |       |                                         |  |  |            |   |  |  | (307 | ) |  |  | (307   | )
|Share repurchase program(4)                                          |  |              |      |   |                                              |  |       |                |  |  | (321                                     | ) |  |                                           |      |   |                                                 |  |       |                                         |  |  | (321        | ) |  |  |     |   |  |  | (321   | )
|Reduction in share capital(4)                                        |  |              | (16   | ) |                                              |  | (404   | )              |  |  | 420                                      |   |  |                                           |      |   |                                                 |  |       |                                         |  |  |            |   |  |  |     |   |  |  |       |  
|Share-based payment:                                                 |  |              |       |   |                                              |  |        |                |  |  |                                          |   |  |                                           |       |   |                                                 |  |        |                                         |  |  |             |   |  |  |      |   |  |  |        |  
| Exercise of stock options                                          |  |              | 1     |   |                                              |  | 17     |                |  |  |                                         |   |  |                                           |      |   |                                                 |  |       |                                         |  |  | 18          |   |  |  |     |   |  |  | 18     |  
| Proceeds from sale of treasury shares on exercise of stock options |  |              |      |   |                                              |  |       |                |  |  | 56                                       |   |  |                                           |      |   |                                                 |  |       |                                         |  |  | 56          |   |  |  |     |   |  |  | 56     |  
| Value of services obtained from employees                          |  |              |      |   |                                              |  |       |                |  |  |                                         |   |  |                                           | 133   |   |                                                 |  |       |                                         |  |  | 133         |   |  |  |     |   |  |  | 133    |  
|Non-controlling interests generated by acquisitions                  |  |              |      |   |                                              |  |       |                |  |  |                                         |   |  |                                           |      |   |                                                 |  |       |                                         |  |  |            |   |  |  | 1    |   |  |  | 1      |  
|Changes in non-controlling interests without loss of control
(5)     |  |              |      |   |                                              |  | (89    | )              |  |  |                                         |   |  |                                           |      |   |                                                 |  |       |                                         |  |  | (89         | ) |  |  | (26  | ) |  |  | (115   | )
|Balance at December 31, 2010                                         |  |              | 2,622 |   |                                              |  | 50,169 |                |  |  | (371                                     | ) |  |                                           | 1,829 |   |                                                 |  | (1,152 | )                                       |  |  | 53,097      |   |  |  | 191  |   |  |  | 53,288 |  



|(1) | See Note D.15.7.
|--- | ----------------

|(2) | Adjustment to retained earnings prior to acquisition of control over Zentiva, in
particular the impairment loss recognized against the carrying amount of the equity interest in 2007.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | In accordance with IFRS 3 (Business Combinations), sanofi-aventis adjusted the
values of certain identifiable assets and liabilities of Merial during the purchase price allocation period (see Note D.1.).
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | See Notes D.15.4. and D.15.5.
|--- | -----------------------------

|(5) | Primarily buyouts of non-controlling interests in Aventis Pharma Limited (India)
and in Zentiva.
|--- | ------------------------------------------------------------------------------------------------



The
accompanying notes on pages F-10 to F-126 are an integral part of the consolidated financial statements.



F-8



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##### Table of Contents

CONSOLIDATED STATEMENTS OF CASH FLOWS



|                                                                                                                         |  |      |           |  |                            |  |        |                            |  |  |                            |   |  |  |        |  
|------------------------------------------------------------------------------------------------------------------------ |  | ---- | --------- |  | -------------------------- |  | ------ | -------------------------- |  |  | -------------------------- | - |  |  | ------ | -
|( million)                                                                                                              |  | Note |           |  | Year endedDecember 31,2010 |  |        | Year endedDecember 31,2009 |  |  | Year endedDecember 31,2008 |  
|Net income attributable to equity holders of sanofi-aventis                                                              |  |      |           |  |                            |  | 5,467  |                            |  |  | 5,265                      |   |  |  | 3,851  |  
|Net income from the held-for-exchange Merial business                                                                    |  |      |           |  |                            |  | (386   | )                          |  |  | (175                       | ) |  |  | (120   | )
|Dividends received from Merial                                                                                           |  |      |           |  |                            |  | 497    |                            |  |  | 179                        |   |  |  | 116    |  
|Non-controlling interests, excluding BMS (1)                                                                             |  |      |           |  |                            |  | 17     |                            |  |  | 21                         |   |  |  | 19     |  
|Share of undistributed earnings of associates and joint ventures                                                         |  |      |           |  |                            |  | 54     |                            |  |  | 34                         |   |  |  | 23     |  
|Depreciation, amortization and impairment of property, plant and equipment and intangible assets                         |  |      |           |  |                            |  | 5,129  |                            |  |  | 5,011                      |   |  |  | 5,985  |  
|Gains and losses on disposals of non-current assets, net of tax (2)                                                      |  |      |           |  |                            |  | (111   | )                          |  |  | (25                        | ) |  |  | (45    | )
|Net change in deferred taxes                                                                                             |  |      |           |  |                            |  | (1,512 | )                          |  |  | (1,169                     | ) |  |  | (1,473 | )
|Net change in provisions                                                                                                 |  |      |           |  |                            |  | 473    |                            |  |  | 161                        |   |  |  | 56     |  
|Cost of employee benefits (stock options and other share-based payments)                                                 |  |      |           |  |                            |  | 131    |                            |  |  | 114                        |   |  |  | 125    |  
|Impact of the workdown of acquired inventories remeasured at fair value                                                  |  |      |           |  |                            |  | 30     |                            |  |  | 27                         |   |  |  |       |  
|Unrealized (gains)/losses recognized in income                                                                           |  |      |           |  |                            |  | 247    | (5)                        |  |  | (81                        | ) |  |  | (13    | )
|Operating cash flow before changes in working capital                                                                    |  |      |           |  |                            |  | 10,036 |                            |  |  | 9,362                      |   |  |  | 8,524  |  
|(Increase)/decrease in inventories                                                                                       |  |      |           |  |                            |  | (378   | )                          |  |  | (489                       | ) |  |  | (84    | )
|(Increase)/decrease in accounts receivable                                                                               |  |      |           |  |                            |  | (82    | )                          |  |  | (429                       | ) |  |  | (309   | )
|Increase/(decrease) in accounts payable                                                                                  |  |      |           |  |                            |  | 28     |                            |  |  | (336                       | ) |  |  | (28    | )
|Net change in other current assets, current financial assets and other current liabilities                               |  |      |           |  |                            |  | 155    |                            |  |  | 407                        |   |  |  | 420    |  
|Net cash provided by/(used in) operating activities (3)                                                                  |  |      |           |  |                            |  | 9,759  |                            |  |  | 8,515                      |   |  |  | 8,523  |  
|Acquisitions of property, plant and equipment and intangible assets                                                      |  |      | D.3./D.4. |  |                            |  | (1,573 | )                          |  |  | (1,785                     | ) |  |  | (1,606 | )
|Acquisitions of investments in consolidated undertakings, net of cash acquired                                           |  |      | D.1.      |  |                            |  | (1,659 | )                          |  |  | (5,563                     | ) |  |  | (661   | )
|Acquisitions of available-for-sale financial assets                                                                      |  |      | D.1./D.7. |  |                            |  | (74    | )                          |  |  | (5                         | ) |  |  | (6     | )
|Proceeds from disposals of property, plant and equipment, intangible assets and other non-current assets, net of tax (4) |  |      | D.2.      |  |                            |  | 131    |                            |  |  | 85                         |   |  |  | 123    |  
|Net change in loans and other non-current financial assets                                                               |  |      |           |  |                            |  | (208   | )                          |  |  | (19                        | ) |  |  | (4     | )
|Net cash provided by/(used in) investing activities                                                                      |  |      |           |  |                            |  | (3,383 | )                          |  |  | (7,287                     | ) |  |  | (2,154 | )
|Issuance of sanofi-aventis shares                                                                                        |  |      | D.15.     |  |                            |  | 18     |                            |  |  | 142                        |   |  |  | 51     |  
|Dividends paid:                                                                                                          |  |      |           |  |                            |  |        |                            |  |  |                            |   |  |  |        |  
| to shareholders of sanofi-aventis                                                                                      |  |      |           |  |                            |  | (3,131 | )                          |  |  | (2,872                     | ) |  |  | (2,702 | )
| to non-controlling interests, excluding BMS (1)                                                                        |  |      |           |  |                            |  | (7     | )                          |  |  | (6                         | ) |  |  | (6     | )
|Transactions with non-controlling interests, other than dividends                                                        |  |      |           |  |                            |  | (97    | )                          |  |  |                           |   |  |  |       |  
|Additional long-term debt contracted                                                                                     |  |      | D.17.     |  |                            |  | 505    |                            |  |  | 4,697                      |   |  |  | 765    |  
|Repayments of long-term debt                                                                                             |  |      | D.17.     |  |                            |  | (1,981 | )                          |  |  | (1,989                     | ) |  |  | (1,253 | )
|Net change in short-term debt                                                                                            |  |      | D.17.     |  |                            |  | 310    |                            |  |  | (785                       | ) |  |  | 557    |  
|Acquisition of treasury shares                                                                                           |  |      | D.15.4.   |  |                            |  | (321   | )                          |  |  |                           |   |  |  | (1,227 | )
|Disposals of treasury shares, net of tax                                                                                 |  |      | D.15.     |  |                            |  | 57     |                            |  |  | 26                         |   |  |  | 6      |  
|Net cash provided by/(used in) financing activities                                                                      |  |      |           |  |                            |  | (4,647 | )                          |  |  | (787                       | ) |  |  | (3,809 | )
|Impact of exchange rates on cash and cash equivalents                                                                    |  |      |           |  |                            |  | 44     |                            |  |  | 25                         |   |  |  | (45    | )
|Net change in cash and cash equivalents                                                                                  |  |      |           |  |                            |  | 1,773  |                            |  |  | 466                        |   |  |  | 2,515  |  
|Cash and cash equivalents, beginning of period                                                                           |  |      |           |  |                            |  | 4,692  |                            |  |  | 4,226                      |   |  |  | 1,711  |  
|Cash and cash equivalents, end of period                                                                                 |  |      | D.13.     |  |                            |  | 6,465  |                            |  |  | 4,692                      |   |  |  | 4,226  |  
|                                                                                                                         |  |      |           | 
|(1)   See Note C.1.
(2)   Including available-for-sale financial assets.
(3)   Including:                                |  |      |           |  |                            |  |        |                            |  |  |                            |   |  |  |        |  
|Income tax paid                                                                                                          |  |      |           |  |                            |  | (3,272 | )                          |  |  | (2,981                     | ) |  |  | (2,317 | )
|Interest paid                                                                                                            |  |      |           |  |                            |  | (474   | )                          |  |  | (269                       | ) |  |  | (317   | )
|Interest received                                                                                                        |  |      |           |  |                            |  | 61     |                            |  |  | 88                         |   |  |  | 132    |  
|Dividends received from non-consolidated entities                                                                        |  |      |           |  |                            |  | 3      |                            |  |  | 5                          |   |  |  | 5      |  



|(4) | Property, plant and equipment, intangible assets, investments in consolidated
undertakings and other non-current financial assets.
|--- | ----------------------------------------------------------------------------------------------------------------------------------

|(5) | Arising primarily on the translation of U.S. dollar surplus cash from American
subsidiaries transferred to the sanofi-aventis parent company.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------



The accompanying notes on pages F-10 to F-126 are an integral part of the consolidated financial statements.



F-9



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Year ended December 31, 2010



INTRODUCTION



Sanofi-aventis and its subsidiaries (sanofi-aventis or the Group) is a global healthcare group engaged in the
research, development, manufacture and marketing of healthcare products, drugs and vaccines. The sanofi-aventis pharmaceutical portfolio includes flagship products, together with a broad range of prescription drugs, generic drugs and consumer health
products.



Sanofi-aventis, the parent company, is
a société anonyme (a form of limited liability company) incorporated under the laws of France. The registered office is at 174, avenue de France, 75013 Paris, France.



Sanofi-aventis is listed in Paris (Euronext: SAN) and New York (NYSE: SNY).



The consolidated financial statements for the year ended
December 31, 2010, and the notes thereto, were adopted by the sanofi-aventis Board of Directors on February 8, 2011.



A. BASIS OF PREPARATION



A.1. International Financial Reporting Standards (IFRS)



The consolidated financial statements cover the twelve-month periods ended December 31, 2010, 2009 and 2008.



In accordance with Regulation No. 1606/2002 of the
European Parliament and Council of July 19, 2002 on the application of international accounting standards, sanofi-aventis has presented its consolidated financial statements in accordance with IFRS since January 1, 2005. The term
IFRS refers collectively to international accounting and financial reporting standards (IASs and IFRSs) and to interpretations of the interpretations committees (SIC and IFRIC), mandatorily applicable as of December 31, 2010.



The consolidated financial statements of
sanofi-aventis as of December 31, 2010 have been prepared in compliance with IFRS as issued by the International Accounting Standards Board (IASB) and with IFRS endorsed by the European Union as of December 31, 2010.



IFRS endorsed by the European Union as of December 31,
2010 are available under the heading IASs/IFRSs, Standards and Interpretations via the web link http://ec.europa.eu/internal_market/accounting/ias/index_en.htm.



The consolidated financial statements have been prepared in accordance with the IFRS general principles of fair
presentation, going concern, accrual basis of accounting, consistency of presentation, materiality, and aggregation.



New standards, amendments and interpretations applicable in 2010 with an impact on the consolidated financial statements are described in
Note A.2. For standards, amendments and interpretations issued by the IASB that are not mandatorily applicable in 2010, refer to Note B.28.



F-10



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



A.2. New standards, amendments and interpretations applicable in 2010



New standards, amendments and interpretations applicable in
2010 with an impact on the consolidated financial statements of sanofi-aventis for the year ended December 31, 2010 are as follows:



|                  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|----------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| Revised IFRS 3: |  | In 2008, the IASB issued a revised version of IFRS 3 (Business Combinations), which has been endorsed by the European Union. The
revised IFRS 3, applied by sanofi-aventis to business combinations completed from 2010 onwards, changes the way in which the purchase method (now known as the acquisition method in the revised IFRS 3) is applied.
 The accounting policies applicable to business combinations are described in
Note B.3. Business combinations and transactions with non-controlling interests, and in Note B.22. Income tax expense, which deals with unrecognized deferred tax assets.                                                             
|                  | 
| Amended IAS 27  |  | In 2008, the IASB issued an amended version of IAS 27 (Consolidated and Separate Financial Statements), which has been endorsed by the European Union and is applicable
simultaneously with the revised IFRS 3. The amendments to IAS 27 largely relate to transactions with non-controlling interests, and to partial disposals resulting in loss of control. The relevant accounting policies are described in Note B.3.
Business combinations and transactions with non-controlling interests.                                                                                                                                                                             
|                  | 
| IFRS 5          |  | The first Annual Improvements to IFRSs standard, issued in 2008, included an amendment to IFRS 5 (Non-Current Assets Held for Sale and Discontinued Operations),
which is mandatorily applicable at the same time as the amended IAS 27. This amendment clarifies the treatment of disposals resulting in loss of control as regards IFRS 5: in such cases, all assets and liabilities of the entity involved must be
classified as assets or liabilities held for sale. This standard has been endorsed by the European Union. The Groups accounting policy for such transactions already complied with this amendment (see Note B.7. Assets held for
sale or exchange).



A.3. Use of estimates



The preparation of financial statements
requires management to make reasonable estimates and assumptions, based on information available at the date of preparation of the financial statements, that may affect the reported amounts of assets, liabilities, revenues and expenses in the
financial statements, and disclosures of contingent assets and contingent liabilities.



Examples include:



| |  |  | amounts deducted from sales for projected sales returns, chargeback incentives, rebates and price reductions (see Note B.14.);
| | - |  | ------------------------------------------------------------------------------------------------------------------------------



| |  |  | provisions relating to product liability claims (see note D.22.);
| | - |  | -----------------------------------------------------------------



| |  |  | impairment of property, plant and equipment, goodwill, intangible assets, and investments in associates and joint ventures (see Note B.6.);
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the valuation of goodwill and the valuation and useful life of acquired intangible assets (see Notes B.3. and B.4.3.);
| | - |  | ----------------------------------------------------------------------------------------------------------------------



| |  |  | the amount of post-employment benefit obligations (see Note B.23.);
| | - |  | -------------------------------------------------------------------



| |  |  | the amount of provisions for restructuring, litigation, tax risks and environmental risks (see Note B.12.);
| | - |  | -----------------------------------------------------------------------------------------------------------



| |  |  | the measurement of contingent payments (see Note D.18.).
| | - |  | --------------------------------------------------------



Actual results could differ from these estimates.



F-11



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



B. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES



B.1. Basis of consolidation



In accordance with IAS 27 (Consolidated and Separate
Financial Statements), the consolidated financial statements include the accounts of the sanofi-aventis parent company and those of its subsidiaries, using the full consolidation method. Subsidiaries are entities which the Group controls (i.e. it
has the power to govern their financial and operating activities). The existence of effectively exercisable or convertible potential voting rights is taken into account in determining whether control exists. Control is presumed to exist where the
Group holds more than 50% of an entitys voting rights.



Equity interests in entities are consolidated from the date on which exclusive control of the entity is obtained; divested equity interests are deconsolidated on the date on which exclusive control
ceases. The Groups share of post-acquisition profits or losses is taken to the income statement, while post-acquisition movements in the acquirees reserves are taken to consolidated reserves.



Entities over which sanofi-aventis exercises joint control
are known as joint ventures and are accounted for using the equity method in accordance with the option in IAS 31 (Interests in Joint Ventures).



Entities over which sanofi-aventis exercises significant
influence are accounted for by the equity method in accordance with IAS 28 (Investments in Associates). Significant influence exists where sanofi-aventis has the power to participate in the financial and operating policy decisions of the investee,
but without the power to exercise control or joint control over those policies. Significant influence is presumed to exist where the Group owns directly, or indirectly via its subsidiaries, between 20% and 50% of the voting rights of the
investee.



Acquisition-related costs are included
as a component of the cost of acquiring joint ventures and associates.



Material transactions between consolidated companies are eliminated, as are intragroup profits.



B.2. Foreign currency translation



B.2.1. Accounting for transactions in foreign currencies in individual company accounts



Non-current assets (other than receivables) and inventories acquired in foreign currencies are translated into
the functional currency using the exchange rate prevailing at the acquisition date.



Monetary assets and liabilities denominated in foreign currencies are translated using the exchange rate prevailing at the balance sheet date. The resulting gains and losses are recorded in the income
statement. However, foreign exchange gains and losses arising from the translation of advances between consolidated subsidiaries for which settlement is neither planned nor likely to occur in the foreseeable future are recognized directly in equity
in Cumulative translation difference.



B.2.2.
Foreign currency translation of the financial statements of foreign subsidiaries



In accordance with IAS 21 (The Effects of Changes in Foreign Exchange Rates), each Group subsidiary translates foreign currency transactions into the currency that is most representative of its
economic environment (the functional currency).



All assets and liabilities are translated into euros using the exchange rate of the subsidiarys functional currency prevailing at
the balance sheet date. Income statements are translated using a weighted average exchange rate for the period. The resulting translation difference is recognized as a separate component of equity in the consolidated statement of comprehensive
income, and is recognized in the income statement only when the subsidiary is sold or is wholly or partially liquidated.



Under the exemptions allowed by IFRS 1, sanofi-aventis elected to eliminate through equity all cumulative translation differences for
foreign operations at the January 1, 2004 IFRS transition date.



F-12



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



B.3. Business combinations and transactions with non-controlling interests



B.3.1. Accounting for business combinations, transactions with
non-controlling interests and loss of control



Business combinations are accounted for using the acquisition method. Under this method, the acquirees identifiable assets and
liabilities that satisfy the recognition criteria of IFRS 3 are measured initially at their fair values as at the date of acquisition, except for non-current assets classified as held for sale, which are measured at fair value less costs to sell.
Restructuring liabilities are not recognized as a liability of the acquiree unless the acquiree has an obligation as at the acquisition date to carry out the restructuring.



Business combinations, completed on or after January 1,
2010, are accounted for in accordance with the revised IFRS 3 (Business Combinations) and the amended IAS 27 (Consolidated and Separate Financial Statements). These revised standards are applied prospectively.



The changes in these two standards have resulted in changes
in the terminology used:



|                           |  |                                                      
|-------------------------- |  | -----------------------------------------------------
|Revised IFRS 3 terminology
|Non-controlling interests  |  | Previous terminology: Minority interests             
|Contingent consideration   |  | Alternative term:Contingent payment                  
|Consideration transferred  |  | Definition:Initial payment + contingent consideration



The principal accounting rules applicable to business combinations and transactions with non-controlling
interests include:



| |  | Acquisition-related costs are recognized as an expense on the acquisition date, as a component of Operating income. In the case of business combinations
completed before January 1, 2010, these costs were accounted for as a component of the cost of the acquisition.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Contingent consideration is recognized in equity if the contingent payment is settled by delivery of a fixed number of the acquirers equity instruments; in all
other cases, it is recognized in liabilities related to business combinations. Contingent consideration is recognized at fair value at the acquisition date irrespective of the probability of payment. Subsequent adjustments after the twelve-month
purchase price allocation period are recognized in profit or loss if the contingent consideration was originally recognized as a liability. Subsequent contingent consideration adjustments in respect of business combinations completed before
January 1, 2010 continue to be accounted for in accordance with the pre-revision IFRS 3, i.e. through goodwill.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In the case of business combinations completed before January 1, 2010, where the contractual arrangements for the combination
included an adjustment to the cost of the combination contingent upon future events, this adjustment was included in the cost of the combination at the acquisition date, if the adjustment was probable and could be measured reliably. If the
adjustment was not probable or could not be measured reliably, it was not included in the cost of the combination on initial recognition of the combination. If the adjustment subsequently became probable and reliably measurable, the additional
consideration was treated as an adjustment to the cost of the combination (i.e. as an adjustment to goodwill).



| |  | In the case of a step acquisition, the previously-held equity interest in the acquiree is remeasured at its acquisition-date fair value, with the difference between
this fair value and the carrying amount taken to profit or loss, along with any gains or losses relating to the previously-held interest that were initially recognized directly in equity (other comprehensive income) and which are reclassifiable to
profit or loss.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In the case of
business combinations where control was acquired in stages before January 1, 2010, goodwill was determined at each stage as the excess of the cost of the transaction over the fair value of the share of assets acquired in each transaction. The
remeasurement of the fair value of the previously-held equity interest was recognized in equity on the line Remeasurement of previously-held equity interests.



F-13



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



| |  | Goodwill may be calculated on the basis of either (i) the entire fair value of the acquiree, or (ii) a share of the fair value of the acquiree proportionate
to the interest acquired. This option may be elected for each acquisition individually. For business combinations completed before January 1, 2010, goodwill was in all cases calculated on the basis of a share of the fair value of the acquiree
proportionate to the interest acquired.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | The effects of (i) a buyout of non-controlling interests in a subsidiary already controlled by the Group, and (ii) divestment of a percentage interest without
loss of control, are recognized in equity.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | In a partial disposal resulting in loss of control, the retained equity interest is remeasured at fair value at the date of loss of control; the gain or loss recognized
on the disposal will include the effect of this remeasurement and the gain or loss on the sale of the equity interest, including items initially recognized in equity and reclassified to profit or loss.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Adjustments to the values of assets and liabilities initially determined provisionally (pending the results of independent valuations or further analysis) are
recognized as a retrospective adjustment to goodwill if they are made within twelve months of the acquisition date. Once this twelve-month period has elapsed, the effects of any adjustments are recognized directly in the income statement, unless
they qualify as an error correction.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Under the exemptions allowed by IFRS 1, sanofi-aventis elected not to restate in accordance with IFRS 3 any business combinations
completed prior to the January 1, 2004 transition date. This includes the combination between Sanofi and Synthélabo that took place in 1999.



Purchase price allocations are performed under the responsibility of management, with assistance from an independent valuer in the case of
major acquisitions.



B.3.2. Goodwill



The excess of the cost of an acquisition over the
Groups interest in the fair value of the identifiable assets and liabilities of the acquiree is recognized as goodwill at the date of the business combination.



Goodwill arising on the acquisition of subsidiaries is shown
as a separate line in the balance sheet in intangible assets under Goodwill, whereas goodwill arising on the acquisition of associates and joint ventures is recorded in Investments in associates and joint ventures.



Goodwill arising on the acquisition of foreign
entities is measured in the functional currency of the acquired entity and translated using the exchange rate prevailing at the balance sheet date.



In accordance with IAS 36 (Impairment of Assets), goodwill is carried at cost less accumulated impairment (see Note B.6.).



Goodwill is tested for impairment annually and
whenever events or circumstances indicate that impairment might exist. Such events or circumstances include significant changes liable to have an other-than-temporary impact on the substance of the original investment.



B.4. Other intangible assets



Intangible assets are initially measured at acquisition cost
or production cost, including any directly attributable costs of preparing the asset for its intended use, or (in the case of assets acquired in a business combination) at fair value as at the date of the combination. They are amortized on a
straight line basis over their useful lives.



The
useful lives of intangible assets are reviewed at each reporting date. The effect of any adjustment to useful lives is recognized prospectively as a change of accounting estimate.



F-14



---

##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Amortization of intangible assets is recognized in the income statement under
Amortization of intangible assets with the exception of amortization of acquired or internally-developed software, which is recognized on the relevant line of the income statement according to the purpose for which the software is
used.



Sanofi-aventis does not own any intangible
assets with an indefinite useful life, other than goodwill.



Intangible assets are carried at cost less accumulated amortization and accumulated impairment, if any, in accordance with IAS 36 (see Note B.6.).



B.4.1. Research and development not acquired in a business combination



Internally generated research and development



In accordance with IAS 38 (Intangible
Assets), internally generated research expenditure is expensed as incurred under Research and development expenses.



Under IAS 38, internally generated development expenses are recognized as an intangible asset if, and only if, all the following six
criteria can be demonstrated: (a) the technical feasibility of completing the development project; (b) the Groups intention to complete the project; (c) the Groups ability to use the project; (d) the probability that
the project will generate future economic benefits; (e) the availability of adequate technical, financial and other resources to complete the project; and (f) the ability to measure the development expenditure reliably.



Due to the risks and uncertainties relating to regulatory
approval and to the research and development process, the six criteria for capitalization are considered not to have been met until marketing approval has been obtained from the regulatory authorities. Consequently, internally generated development
expenses arising before marketing approval has been obtained, mainly the cost of clinical trials, are expensed as incurred under Research and development expenses.



Chemical industrial development expenses incurred to develop
a second-generation process are incurred after initial regulatory approval has been obtained, in order to improve the industrial process for an active ingredient. To the extent that the six IAS 38 criteria are considered as being met, these
expenses are capitalized under Other intangible assetsas incurred.



Separately acquired research and development



Payments for separately acquired research and development are capitalized under Other intangible assets provided that they meet the definition of an intangible asset: a resource that is
(i) controlled by the Group, (ii) expected to provide future economic benefits, and (iii) identifiable (i.e. is either separable or arises from contractual or legal rights). Under paragraph 25 of IAS 38, the first condition for
capitalization (the probability that the expected future economic benefits will flow to the entity) is considered to be satisfied for separately acquired research and development. Because the amount of the payments is determinable, the second
condition for capitalization (the cost can be measured reliably) is also met. Consequently, upfront and milestone payments to third parties related to pharmaceutical products for which regulatory marketing approval has not yet been obtained are
recognized as intangible assets, and amortized on a straight line basis over their useful lives from the date on which regulatory approval is obtained.



Payments under research and development arrangements relating to access to technology or to databases and payments made to purchase
generics files are also capitalized, and amortized over the useful life of the intangible asset.



Subcontracting arrangements, payments for research and development services and continuous payments under research and development collaborations, unrelated to the outcome of the research and development
efforts, are expensed over the service term.



F-15



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



B.4.2. Intangible assets not acquired in a business combination



Licenses other than those related to pharmaceutical products
and research projects, in particular software licenses, are capitalized at acquisition cost, including any directly attributable cost of preparing the software for its intended use. Software licenses are amortized on a straight line basis over their
useful lives for the Group (three to five years).



Internally generated costs incurred to develop or upgrade software are capitalized if the IAS 38 criteria for recognition as an
intangible asset are satisfied, and amortized on a straight line basis over the useful life of the software from the date on which the software is ready for use.



B.4.3. Intangible assets acquired in a business combination



Intangible assets acquired in a business
combination which relate to in-process research and development and are reliably measurable are separately identified from goodwill and capitalized in Other intangible assets in accordance with IFRS 3 (Business Combinations) and
IAS 38 (Intangible Assets). The related deferred tax liability is also recognized.



In-process research and development acquired in a business combination is amortized on a straight line basis over its useful life from the date of receipt of regulatory approval.



Rights to products sold by the Group are amortized on a
straight line basis over their useful lives, determined on the basis of cash flow forecasts that take account of (among other factors) the period of legal protection of the related patents.



B.5. Property, plant and equipment



Property, plant and equipment is initially measured and
recognized at acquisition cost, including any directly attributable cost of preparing the asset for its intended use, or (in the case of assets acquired in a business combination) at fair value as at the date of the combination. The component-based
approach to accounting for property, plant and equipment is applied. Under this approach, each component of an item of property, plant and equipment with a cost which is significant in relation to the total cost of the item and which has a different
useful life from the other components must be depreciated separately.



After initial measurement, property, plant and equipment is carried at cost less accumulated depreciation and impairment, except for land which is carried at cost less impairment.



Subsequent costs are not recognized as assets, unless
(i) it is probable that future economic benefits associated with these costs will flow to the Group, and (ii) the costs can be measured reliably.



Day-to-day maintenance costs of property, plant and equipment are expensed as incurred.



Borrowing costs attributable to the financing of items of
property, plant and equipment, and incurred during the construction period of such items, are capitalized as part of the acquisition cost of the item.



Government grants relating to non-current assets are deducted from the acquisition cost of the asset to which they relate.



In accordance with IAS 17 (Leases), items of property, plant
and equipment, leased by sanofi-aventis as lessee under finance leases, are recognized as an asset in the balance sheet, with the related lease obligation recognized as a liability. A lease qualifies as a finance lease if it transfers substantially
all the risks and rewards of ownership of the asset to the Group. Assets held under finance leases are carried at the lower of the fair value of the leased asset or the present value of the minimum lease payments, and are depreciated over the
shorter of the useful life of the asset or the term of the lease.



F-16



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The depreciable amount of items of property, plant and equipment, net of any residual
value, is depreciated on a straight line basis over the useful life of the asset. The useful life of an asset is usually equivalent to its economic life.



The useful lives of property, plant and equipment are as follows:



|                      |  |  |                | 
|--------------------- |  |  | -------------- | 
|Buildings             |  |  | 15 to 40 years | 
|Fixtures              |  |  | 10 to 20 years | 
|Plant and equipment   |  |  | 5 to 15 years  | 
|Other tangible assets |  |  | 3 to 15 years  | 



Useful lives and residual values of property, plant and equipment are reviewed annually. The effect of any adjustment to useful lives or
residual values is recognized prospectively as a change of accounting estimate.



Depreciation of property, plant and equipment is recognized as an expense in the income statement, in the relevant classification of expense by function.



B.6. Impairment of property, plant and
equipment, intangible assets, and investments in associates and joint ventures



B.6.1. Impairment of property, plant and equipment and intangible assets



Assets that generate separate cash flows and assets included in cash-generating units (CGUs) are assessed for impairment in accordance
with IAS 36 (Impairment of Assets) when events or changes in circumstances indicate that the asset or CGU may be impaired.



A CGU is the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other
assets or groups of assets.



Under IAS 36, each
CGU to which goodwill is allocated must (i) represent the lowest level within the entity at which the goodwill is monitored for internal management purposes, and (ii) not be larger than an operating segment determined in accordance with
IFRS 8 (Operating Segments), before application of the IFRS 8 aggregation criteria. Consequently, the CGUs used by sanofi-aventis to test goodwill for impairment correspond to the geographical sub-segments of each operating segment.



Quantitative and qualitative indications of impairment
(primarily relating to pharmacovigilance, patent litigation and the launch of competing products) are reviewed at each reporting date. If there is any internal or external indication of impairment, the Group estimates the recoverable amount of the
asset or CGU.



Intangible assets not yet available
for use (such as capitalized in-process research and development), and CGUs that include goodwill, are tested for impairment annually whether or not there is any indication of impairment, and more frequently if any event or circumstance indicates
that they might be impaired. These assets are not amortized.



When there is an internal or external indication of impairment, the Group estimates the recoverable amount of the asset and recognizes an impairment loss when the carrying amount of the asset exceeds its
recoverable amount. The recoverable amount of the asset is the higher of its fair value less costs to sell or its value in use. To determine the value in use, the Group uses estimates of future cash flows generated by the asset or CGU, prepared
using the same methods as those used in the initial measurement of the asset or CGU on the basis of medium-term plans.



In the case of goodwill, estimates of future cash flows are based on a five-year strategic plan plus an extrapolation of the cash flows
beyond the five-year plan, plus a terminal value. In the case of other intangible assets, the period used is based on the economic life of the asset.



F-17



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Estimated cash flows are discounted at long-term market interest rates that reflect the
best estimate by sanofi-aventis of the time value of money, the risks specific to the asset or CGU, and economic conditions in the geographical regions in which the business activity associated with the asset or CGU is located.



Certain assets and liabilities that are not directly
attributable to a specific CGU are allocated between CGUs on a basis that is reasonable, and consistent with the allocation of the corresponding goodwill.



Impairment losses on intangible assets are recognized under Impairment of intangible assets in the income statement.



B.6.2. Impairment of investments in associates and joint
ventures



In accordance with IAS 28
(Investments in Associates), the Group applies the criteria specified in IAS 39 (Financial Instruments: Recognition and Measurement) to determine whether an investment in an associate or joint venture may be impaired (see Note B.8.2.). If an
investment is impaired, the amount of the impairment loss is determined by applying IAS 36 (see Note B.6.1.) and recognized in Share of profit/loss of associates and joint ventures.



B.6.3. Reversals of impairment losses
charged against property, plant and equipment, intangible assets, and investments in associates and joint ventures



At each reporting date, the Group assesses if events or changes in circumstances indicate that an impairment loss recognized in a prior
period in respect of an asset (other than goodwill) or an investment in an associate or joint venture can be reversed. If this is the case, and the recoverable amount as determined based on the new estimates exceeds the carrying amount of the asset,
the Group reverses the impairment loss only to the extent of the carrying amount that would have been determined had no impairment loss been recognized for the asset.



Reversals of impairment losses in respect of intangible
assets are recognized in the income statement under Impairment of intangible assets, while reversals of impairment losses in respect of investments in associates and joint ventures are recognized in the income statement under
Share of profit/loss of associates and joint ventures. Impairment losses taken against goodwill are never reversed, unless the goodwill is part of the carrying amount of an investment in an associate or joint venture.



B.7. Assets held for sale or exchange



In accordance with IFRS 5 (Non-Current Assets Held for Sale
and Discontinued Operations), non-current assets and groups of assets must be classified as held for sale in the balance sheet if their carrying amount will be recovered principally through a sale transaction rather than through continuing use.
Within the meaning of IFRS 5, the term sale also includes exchanges for other assets.



Non-current assets or asset groups held for sale must be available for immediate sale in their present condition, subject only to terms
that are usual and customary for sales of such assets, and a sale must be highly probable. Criteria used to determine whether a sale is highly probable include:



| |  | the appropriate level of management must be committed to a plan to sell;
| | - | ------------------------------------------------------------------------



| |  | an active program to locate a buyer and complete the plan must have been initiated;
| | - | -----------------------------------------------------------------------------------



| |  | the asset must be actively marketed for sale at a price that is reasonable in relation to its current fair value;
| | - | -----------------------------------------------------------------------------------------------------------------



| |  | completion of the sale should be foreseeable within the twelve months following the date of classification as held for sale or exchange; and
| | - | --------------------------------------------------------------------------------------------------------------------------------------------



| |  | actions required to complete the plan should indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------



F-18



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Before the initial classification of the non-current asset (or asset group) as
held for sale or exchange, the carrying amounts of the asset (or of all the assets and liabilities in the asset group) must be measured in accordance with the applicable standards.



Subsequent to classification as held for sale or exchange, the non-current asset (or asset group)
is measured at the lower of carrying amount or fair value less costs to sell, with any write-down recognized by means of an impairment loss. Once a non-current asset has been classified as held for sale or exchange, it is no longer
depreciated or amortized.



In a disposal of an
equity interest leading to loss of control, all the assets and liabilities of the entity involved are classified as assets or liabilities held for sale in the balance sheet line items Assets held for sale or exchange or
Liabilities related to assets held for sale or exchange, provided that the disposal satisfies the IFRS 5 classification criteria.



The profit or loss generated by a held-for-sale asset group is reported on a separate line in the income statement for the current period
and for the comparative periods presented, provided that the asset group:



| |  | represents a separate major line of business or geographical area of operations; or,
| | - | ------------------------------------------------------------------------------------



| |  | is part of a single co-ordinated plan to dispose of a separate major line of business or geographical area of operations; or,
| | - | -----------------------------------------------------------------------------------------------------------------------------



| |  | is a subsidiary acquired exclusively with a view to resale.
| | - | -----------------------------------------------------------



Events or circumstances beyond the Groups control may extend the period to complete the sale or exchange beyond one year without
precluding classification of the asset (or disposal group) in Assets held for sale or exchange provided that there is sufficient evidence that the Group remains committed to the planned sale or exchange.



B.8. Financial instruments



B.8.1. Non-derivative financial assets



Under IFRS, and in accordance with IAS 39 and IAS 32
(Financial Instruments: Presentation), sanofi-aventis has adopted the following classification for non-derivative financial assets, based on the type of asset and on management intent at the date of initial recognition (except for assets already
held at the transition date and reclassified at that date in accordance with IFRS 1). The designation and classification of such financial assets are subsequently reassessed at each reporting date.



Non-derivative financial assets are recognized on the date
when sanofi-aventis becomes party to the contractual terms of the asset. On initial recognition, financial assets are measured at fair value, plus direct transaction costs in the case of financial assets not designated as fair value through profit
or loss.



Classification, presentation and
subsequent measurement of non-derivative financial assets are as follows:



| |  |  | Financial assets at fair value through profit or loss
| | - |  | -----------------------------------------------------



These assets are classified in the balance sheet in the line
items Non-current financial assets, Current financial assets and Cash and cash equivalents.



Financial assets at fair value through profit or loss comprise assets held for trading (financial assets
acquired principally for the purpose of reselling them in the near term, usually within less than 12 months), and financial instruments designated as fair value through profit and loss on initial recognition in accordance with the conditions for
application of the fair value option.



These
financial assets are carried at fair value, without any deduction for transaction costs that may be incurred on sale. Realized and unrealized gains and losses resulting from changes in the fair value of these assets are recognized in the income
statement, in Financial income orFinancial expenses.



F-19



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Realized and unrealized foreign exchange gains and losses on financial assets in
currencies other than the euro are recognized in the income statement in Financial income orFinancial expenses.



| |  |  | Available-for-sale financial assets
| | - |  | -----------------------------------



Available-for-sale financial assets are non-derivative financial assets that are (i) designated by management as available-for-sale
or (ii) not classified as financial assets at fair value through profit or loss, held-to-maturity investments or loans and receivables. This category includes participating interests in quoted or unquoted
companies (other than investments in associates and joint ventures) that management intends to hold on a long-term basis. Available-for-sale financial assets are classified in Non-current financial assets.



Available-for-sale financial assets are measured at fair
value, without any deduction for transaction costs that may be incurred on sale. Gains and losses arising from changes in the fair value of these assets, including unrealized foreign exchange gains and losses, are recognized directly in equity in
the consolidated statement of comprehensive income in the period in which they occur, except for impairment losses and foreign exchange gains and losses on debt instruments. On derecognition of an available-for-sale financial asset, or on
recognition of an impairment loss on such an asset, the cumulative gains and losses previously recognized in equity are recognized in the income statement for the period under Financial incomeor Financial expenses.



Interest income and dividends on equity
instruments are recognized in the income statement under Financial income when the Group is entitled to receive payment.



Available-for-sale financial assets in the form of participating interests in companies not quoted in an active market are measured at
cost if their fair value cannot be measured reliably; an impairment loss is recognized when there is objective evidence that such an asset is impaired.



Realized foreign exchange gains and losses are recognized in the income statement under Financial income or Financial
expenses.



| |  |  | Held-to-maturity investments
| | - |  | ----------------------------



Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturities that the Group
has the positive intention and ability to hold to maturity.



These investments are measured at amortized cost using the effective interest method.



Sanofi-aventis did not hold any such investments during the years ended December 31, 2010, 2009 or 2008.



| |  |  | Loans and receivables
| | - |  | ---------------------



Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market.
They are presented in current assets, under Other current assets in the case of loans and underAccounts receivable in the case of receivables. Loans with a maturity of more than 12 months are presented in Long-term
loans and advances underNon-current financial assets. Loans and receivables are measured at amortized cost using the effective interest method.



Realized and unrealized foreign exchange gains and losses
are recognized in the income statement under Financial income or Financial expenses.



B.8.2. Impairment of non-derivative financial assets



Indicators of impairment are reviewed for all non-derivative financial assets at each reporting date. Such indicators include default in
contractual payments, significant financial difficulties of the issuer or debtor, probability of bankruptcy, or prolonged or significant decline in quoted market price. An impairment loss is recognized in the income statement when there is objective
evidence that an asset is impaired.



F-20



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The impairment loss on loans and receivables, which are measured at amortized cost, is
the difference between the carrying amount of the asset and the present value of estimated future cash flows discounted at the financial assets original effective interest rate.



When an impairment loss is identified on an available-for-sale financial asset, the cumulative losses
previously recognized directly in equity are recorded in the income statement. The loss recognized in the income statement is the difference between the acquisition cost (net of principal repayment and amortization) and the fair value at the time of
impairment, less any impairment loss previously recognized in the income statement.



The impairment loss on investments in companies, that are not quoted in an active market and are measured at cost, is the difference between the carrying amount of the investment and the present value of
its estimated future cash flows, discounted at the current market interest rate for similar financial assets.



Impairment losses in respect of loans are recognized under Financial expenses in the income statement.



Impairment losses in respect of trade receivables are
recognized under Selling and general expenses in the income statement.



Impairment losses on investments in companies that are not quoted in an active market and are measured at cost, and on equity instruments classified as available-for-sale financial assets, cannot be
reversed through the income statement.



B.8.3. Derivative
instruments



Derivative instruments that do
not qualify for hedge accounting are initially and subsequently measured at fair value, with changes in fair value recognized in the income statement in Other operating income or in Financial income or Financial
expenses depending on the nature of the economic underlying which they are intended to hedge.



Derivative instruments that qualify for hedge accounting are measured in accordance with the hedge accounting requirements of IAS 39 (see
Note B.8.4.).



B.8.4. Hedging



Hedging involves the use of derivative financial
instruments. Changes in the fair value of these instruments are intended to offset the exposure of the hedged items to changes in fair value.



As part of its overall interest rate risk and foreign exchange risk management policy, the Group enters into various transactions
involving derivative instruments. Derivative instruments used in connection with the Groups hedging policy may include forward exchange contracts, currency options, interest rate swaps and interest rate options.



Derivative financial instruments qualify as hedging
instruments for hedge accounting purposes when (a) at the inception of the hedge there is formal designation and documentation of the hedging relationship and of the risk management strategy and objective; (b) the hedge is expected by
management to be highly effective in offsetting the risk; (c) the forecast transaction being hedged is highly probable and presents an exposure to variations in cash flows that could ultimately affect profit or loss; (d) the effectiveness
of the hedge can be reliably measured; and (e) the hedge is assessed on an ongoing basis and determined actually to have been highly effective throughout the reporting periods for which the hedge was designated.



F-21



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



These criteria are applied when the Group uses derivative instruments designated as a
fair value hedge, a cash flow hedge or a hedge of a net investment in a foreign operation.



| |  |  | Fair value hedge
| | - |  | ----------------



A fair value hedge is a hedge of the exposure to changes in fair value of a recognized asset or liability or unrecognized firm commitment
that could affect profit or loss.



Changes in
fair value of the hedging instrument and changes in fair value of the hedged item attributable to the hedged risk are recognized in the income statement, under Other operating incomefor hedges of operating activities and under
Financial income or Financial expenses for hedges of investing or financing activities.



| |  |  | Cash flow hedge
| | - |  | ---------------



A cash flow hedge is a hedge of the exposure to variability in cash flows attributable to a particular risk associated with a recognized
asset or liability, or a highly probable forecast transaction, that could affect profit or loss.



Changes in fair value of the hedging instrument attributable to the effective portion of the hedge are recognized directly in equity in the consolidated statement of comprehensive income. Changes in fair
value attributable to the ineffective portion of the hedge are recognized in the income statement under Other operating incomefor hedges of operating activities, and under Financial income or Financial
expenses for hedges of investing or financing activities.



Cumulative changes in fair value of the hedging instrument previously recognized in equity are transferred to the income statement when the hedged transaction affects profit or loss. These transferred
gains and losses are recorded under Other operating incomefor hedges of operating activities and Financial income or Financial expenses for hedges of investing or financing activities.



When a forecast transaction results in the recognition of a
non-financial asset or liability, cumulative changes in the fair value of the hedging instrument previously recognized in equity are included in the initial measurement of the asset or liability.



When the hedging instrument expires or is sold, terminated
or exercised, the cumulative gain or loss previously recognized in equity remains separately recognized in equity until the forecast transaction occurs. However, if the Group no longer expects the forecast transaction to occur, the cumulative gain
or loss previously recognized in equity is recognized immediately in the income statement.



| |  |  | Hedge of a net investment in a foreign operation
| | - |  | ------------------------------------------------



In the case of a hedge of a net investment in a foreign
operation, changes in the fair value of the hedging instrument attributable to the effective portion of the hedge are recognized directly in equity in the consolidated statement of comprehensive income. Changes in fair value attributable to the
ineffective portion of the hedge are recognized in the income statement under Financial incomeorFinancial expenses. When the investment in the foreign operation is sold, the changes in the fair value of the hedging
instrument previously recognized in equity are transferred to the income statement under Financial incomeorFinancial expenses.



Hedge accounting is discontinued when (a) the hedging instrument expires or is sold, terminated or exercised, or (b) the hedge
no longer meets the criteria for hedge accounting, or (c) the Group revokes the hedge designation, or (d) management no longer expects the forecast transaction to occur.



B.8.5. Non-derivative financial liabilities



| |  |  | Borrowings and debt
| | - |  | -------------------



Bank borrowings and debt instruments are initially measured at fair value of the consideration received, net of directly attributable
transaction costs.



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Subsequently, they are measured at amortized cost using the effective interest method.
All costs related to the issuance of borrowings or debt instruments, and all differences between the issue proceeds net of transaction costs and the value on redemption, are recognized under Financial expensesin the income statement
over the term of the debt using the effective interest method.



| |  |  | Liabilities related to business combinations and to non-controlling interests
| | - |  | -----------------------------------------------------------------------------



Liabilities related to business combinations and to
non-controlling interests are split into a current portion and a non-current portion. These line items are used to recognize contingent consideration payable in business combinations (see Note B.3.1. for a description of the relevant accounting
policy), and the fair value of put options granted to non-controlling interests.



| |  |  | Other non-derivative financial liabilities
| | - |  | ------------------------------------------



Other non-derivative financial liabilities include trade accounts payable, which are measured at fair value (which in most cases equates
to face value) on initial recognition, and subsequently at amortized cost.



B.8.6. Fair value of financial instruments



Under IFRS 7 (Financial Instruments: Disclosures), fair value measurements must be classified using a fair value hierarchy with the following levels:



| |  | Level 1: quoted prices in active markets for identical assets or liabilities (without modification or repackaging);
| | - | -------------------------------------------------------------------------------------------------------------------



| |  | Level 2: quoted prices in active markets for similar assets and liabilities, and valuation techniques in which all important inputs are derived from observable market
data; and
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Level 3: valuation techniques in which not all important inputs are derived from observable market data.
| | - | --------------------------------------------------------------------------------------------------------



F-23



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The table below sets forth the principles used to measure the fair value of the
principal financial assets and liabilities recognized by sanofi-aventis in its consolidated balance sheet:



|      |  |                                                                               |  |                                                               |  |                                                                                                      |  |              |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |  |            |  |                                                                                    |  |                 
|----- |  | ----------------------------------------------------------------------------- |  | ------------------------------------------------------------- |  | ---------------------------------------------------------------------------------------------------- |  | ------------ |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------- |  | ---------------------------------------------------------------------------------- |  | ----------------
|Note  |  | Type of financial instrument                                                  |  | Measurementprinciple appliedin the 
consolidatedbalance sheet |  | Level in theIFRS 7 fair valuehierarchy
asdisclosed in thenotes to theconsolidatedfinancialstatements |  |              |  | Method used to determine fair value as
disclosed in the notes to the consolidated financial statements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|      |  |                                                                               |  |                                                               |  |                                                                                                      |  | Market data 
|      |  |                                                                               |  |                                                               |  | Valuation model                                                                                      |  | Exchangerate |  | Interest rate                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  | Volatility
|D.7.  |  | Available-for-sale financial assets (quoted securities)                       |  | Fair value                                                    |  | 1                                                                                                    |  |              |  | Quoted market price                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  | N/A       
|D.7.  |  | Available-for-sale financial assets (unquoted securities)                     |  | Fair value                                                    |  | 2                                                                                                    |  |              |  | Present value of future cash flows                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |  | N/A        |  | Mid swap + z-spread forbonds of comparable riskand maturity                        |  | N/A             
|D.7.  |  | Long-term loans and advances                                                  |  | Amortized cost                                                |  | N/A                                                                                                  |  |              |  | The amortized cost of long-term loans and advances at the balance sheet date is not materially different from their fair
value.                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|D.7.  |  | Assets recognized under the fair value option (1)                             |  | Fair value                                                    |  | 1                                                                                                    |  |              |  | Market value (net asset value)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  | N/A       
|D.20. |  | Forward currency contracts                                                    |  | Fair value                                                    |  | 2                                                                                                    |  |              |  | Present value of future cash flows                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |  | ECBFixing  |  | < 1 year: Mid Money Market> 1 year: Mid Zero Coupon                                |  | N/A             
|D.20. |  | Currency options                                                              |  | Fair value                                                    |  | 2                                                                                                    |  |              |  | Options with no knock-out feature:
Garman & Kohlhagen 
Knock-out options: Merton, Reiner & Rubinstein                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  | ECBFixing  |  | < 1 year: Mid Money Market> 1 year: Mid Zero Coupon                                |  | Mid in-the-money
|D.20. |  | Interest rate swaps                                                           |  | Fair value                                                    |  | 2                                                                                                    |  |              |  | Present value of future cash flows                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |  | N/A        |  | < 1 year: Mid Money Marketand LIFFE interest ratefutures
> 1 year: Mid Zero Coupon |  | N/A             
|D.20. |  | Cross-currency swaps                                                          |  | Fair value                                                    |  | 2                                                                                                    |  |              |  | Present value of future cash flows                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |  | ECBFixing  |  | < 1 year: Mid Money Marketand LIFFE interest ratefutures
> 1 year: Mid Zero Coupon |  | N/A             
|D.13. |  | Investments in collective investment schemes                                  |  | Fair value                                                    |  | 1                                                                                                    |  |              |  | Market value (net asset value)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  | N/A       
|D.13. |  | Negotiable debt instruments, sight deposits and term deposits                 |  | Amortized cost                                                |  | N/A                                                                                                  |  |              |  | Because these instruments have a maturity of less than 3 months, amortized cost is regarded as an acceptable approximation of
fair value as disclosed in the notes to the consolidated financial statements.                                                                                                                                                                                                                                                                                                                                                                                   
|D.17. |  | Financial liabilities                                                         |  | Amortized cost(2)                                             |  | N/A                                                                                                  |  |              |  | For financial liabilities with a maturity of less than 3 months, amortized cost is
regarded as an acceptable approximation of fair value as disclosed in the notes to the consolidated financial statements. 
For financial liabilities with a maturity of more than 3 months, fair value as disclosed in the notes to the consolidated financial statements is
determined either by reference to quoted market prices at the balance sheet date (quoted instruments) or by discounting the future cash flows based on observable market data at the balance sheet date (unquoted instruments).
|D.18. |  | Liabilities related to business combinations and to non-controlling interests |  | Fair value(3)                                                 |  | 3                                                                                                    |  |              |  | Contingent consideration payable in a business combination is a financial liability under IAS 32. The fair value of such
liabilities is determined by adjusting the contingent consideration at the balance sheet date using the method described in Note D.18.                                                                                                                                                                                                                                                                                                                                



|(1) | These assets are held to fund a deferred compensation plan offered to certain
employees, included in the obligations described in Note D.19.1.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------

|(2) | In the case of financial liabilities designated as hedged items in a fair value
hedging relationship, the carrying amount in the consolidated balance sheet includes changes in fair value relating to the hedged risk(s).
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | In the case of business combinations completed prior to the application of the
revised IFRS 3, contingent consideration is recognized when payment becomes probable (see Note B.3.1.).
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-24



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The other financial assets and liabilities included in the Group balance sheet are the
following:



| |  |  | Non-derivative current financial assets and liabilities: due to their short-term maturity, the fair value of these instruments approximates their
carrying amount (i.e., historical cost less any credit risk allowance).
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Investments in equity instruments not quoted in an active market: in accordance with IFRS 7, the fair value of these instruments is not disclosed
because their fair value cannot be measured reliably.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



B.8.7. Derecognition of financial instruments



Sanofi-aventis derecognizes financial assets when the contractual rights to cash flows from these assets have ended or have been transferred and when the Group has transferred substantially all risks and
rewards of ownership of these assets. If the Group has neither transferred nor retained substantially all the risks and rewards of ownership of these assets, they are derecognized if the Group does not retain the control of these assets.



Financial liabilities are derecognized when the Groups
contractual obligations in respect of such liabilities are discharged or cancelled or expired.



B.8.8. Risks relating to financial instruments



Market risks in respect of non-current financial assets, cash equivalents, derivative instruments and debt are described in the risk factors presented in Item 3.D. and Item 11.



Credit risk is the risk that customers may fail to pay their
debts. This risk also arises as a result of the concentration of the Groups sales with its largest customers, in particular certain wholesalers in the United States. Customer credit risk is described in the risk factors presented in
Item 3.D.



B.9. Inventories



Inventories are measured at the lower of cost or net
realizable value. Cost is calculated using the weighted average cost method or the first-in, first-out method, depending on the nature of the inventory.



The cost of finished goods inventories includes costs of purchase, costs of conversion and other costs incurred in bringing the
inventories to their present location and condition.



Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.



B.10. Cash and cash equivalents



Cash and cash equivalents as shown in the consolidated
balance sheet and statement of cash flows comprise cash, plus liquid short-term investments that are (i) readily convertible into cash, and (ii) subject to an insignificant risk of changes in value in the event of movements in interest
rates.



B.11. Treasury shares



In accordance with IAS 32, sanofi-aventis treasury shares
are deducted from equity, irrespective of the purpose for which they are held. No gain or loss is recognized in the income statement on the purchase, sale, impairment or cancellation of treasury shares.



B.12. Provisions for risks



In accordance with IAS 37 (Provisions, Contingent
Liabilities and Contingent Assets), sanofi-aventis records a provision where it has a present obligation, whether legal or constructive, as a result of a past event; it is probable that an outflow of resources embodying economic benefits will be
required to settle the obligation; and a reliable estimate can be made of the amount of the outflow of resources.



F-25



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



If the obligation is expected to be settled more than twelve months after the balance
sheet date, or has no definite settlement date, the provision is recorded under Provisions and other non-current liabilities.



Provisions relating to the insurance programs, in which the Groups captive insurance company participates, are based on risk
exposure estimates calculated by management, with assistance from independent actuaries, using IBNR (Incurred But Not Reported) techniques. These techniques use past claims experience, within the Group and in the market, to estimate future trends in
the cost of claims.



Contingent liabilities are
not recognized, but are disclosed in the notes to the financial statements unless the possibility of an outflow of economic resources is remote.



Provisions are estimated on the basis of events and circumstances related to present obligations at the balance sheet date, of past
experience, and to the best of managements knowledge at the date of preparation of the financial statements.



Reimbursements offsetting the probable outflow of resources are recognized as assets only if it is virtually certain that they will be
received. Contingent assets are not recognized.



Restructuring provisions are recognized if the Group has a detailed, formal restructuring plan at the balance sheet date and has announced
its intention to implement this plan to those affected by it.



No provisions are recorded for future operating losses.



Sanofi-aventis records non-current provisions for certain obligations such as legal environmental obligations and litigation where an
outflow of resources is probable and the amount of the outflow can be reliably estimated. Where the effect of the time value of money is material, these provisions are measured at the present value of the expenditures expected to be required to
settle the obligation, calculated using a discount rate that reflects an estimate of the time value of money and the risks specific to the obligation.



Increases in provisions to reflect the effects of the passage of time are recognized in Financial expenses.



B.13. Emission rights



Under international agreements, the
European Union has committed to reducing greenhouse gas emissions and instituted an emissions allowance trading scheme. Approximately ten sanofi-aventis sites in Europe are covered by the scheme. Sanofi-aventis accounts for emission allowances as
follows: the annual allowances allocated by government are recognized as intangible assets measured at fair value at the date of initial recognition, with a matching liability recognized to reflect the government grant effectively arising from the
fact that allowances are issued free of charge. As and when allowances are consumed, they are transferred to Deliverable allowances in order to recognize the liability to government in respect of actual CO2emissions. If the allocated allowances are insufficient to cover actual
emissions, an expense is recognized in order to reflect the additional allowances deliverable; this expense is measured at the market value of the allowances.



B.14. Revenue recognition



Revenue arising from the sale of goods is presented in the income statement under Net sales. Net sales comprise revenue from
sales of pharmaceutical products, vaccines, and active ingredients, net of sales returns, of customer incentives and discounts, and of certain sales-based payments paid or payable to the healthcare authorities.



Revenue is recognized when all of the following conditions
have been met: the risks and rewards of ownership have been transferred to the customer; the Group no longer has effective control over the goods sold;



F-26



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



the amount of revenue and costs associated with the transaction can be measured reliably; and it is probable that the economic benefits associated with the transaction will flow to the Group, in
accordance with IAS 18 (Revenue). In particular, the contracts between sanofi pasteur and government agencies specify terms for the supply and acceptance of batches of vaccine; revenue is recognized when these conditions are met.



The Group offers various types of price reductions on its
products. In particular, products sold in the United States are covered by various governmental programs (such as Medicare and Medicaid) under which products are sold at a discount. Rebates are granted to healthcare authorities, and under
contractual arrangements with certain customers. Some wholesalers are entitled to chargeback incentives based on the selling price to the end customer, under specific contractual arrangements. Cash discounts may also be granted for prompt payment.



Returns, discounts, incentives and rebates, as
described above, are recognized in the period in which the underlying sales are recognized as a reduction of sales revenue.



These amounts are calculated as follows:



| |  |  | Provisions for chargeback incentives are estimated on the basis of the relevant subsidiarys standard sales terms and conditions, and in certain
cases on the basis of specific contractual arrangements with the customer. They represent managements best estimate of the ultimate amount of chargeback incentives that will eventually be claimed by the customer.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Provisions for rebates based on attainment of sales targets are estimated and accrued as each of the underlying sales transactions is recognized.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Provisions for price reductions under Government and State programs, largely in the United States, are estimated on the basis of the specific terms of
the relevant regulations and/or agreements, and accrued as each of the underlying sales transactions is recognized.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Provisions for sales returns are calculated on the basis of managements best estimate of the amount of product that will ultimately be returned
by customers. In countries where product returns are possible, sanofi-aventis has implemented a returns policy that allows the customer to return products within a certain period either side of the expiry date (usually 6 months before and 12 months
after the expiry date). The provision is estimated on the basis of past experience of sales returns.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The Group also takes account of factors such as levels of inventory in its various distribution channels, product expiry dates,
information about potential discontinuation of products, the entry of competing generics into the market, and the launch of over-the-counter medicines.



In each case, the provisions are subject to continuous review and adjustment as appropriate based on the most recent information available
to management.



The Group believes that it has the
ability to measure each of the above provisions reliably, using the following factors in developing its estimates:



| |  |  | the nature and patient profile of the underlying product;
| | - |  | ---------------------------------------------------------



| |  |  | the applicable regulations and/or the specific terms and conditions of contracts with governmental authorities, wholesalers and other customers;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | historical data relating to similar contracts, in the case of qualitative and quantitative rebates and chargeback incentives;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------



| |  |  | past experience and sales growth trends for the same or similar products;
| | - |  | -------------------------------------------------------------------------



| |  |  | actual inventory levels in distribution channels, monitored by the Group using internal sales data and externally provided data;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------



| |  |  | the shelf life of the Groups products; and
| | - |  | -------------------------------------------



| |  |  | market trends including competition, pricing and demand.
| | - |  | --------------------------------------------------------



F-27



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Non-product revenues, mainly comprising royalty income from license arrangements that
constitute ongoing operations of the Group (see Note C.), are presented in Other revenues.



B.15. Cost of sales



Cost of sales consists primarily of the industrial cost of goods sold, payments made under licensing agreements, and distribution costs. The industrial cost of goods sold includes the cost of materials,
depreciation of property, plant and equipment and software, personnel costs, and other expenses attributable to production.



B.16. Research and development expenses



Internally generated research costs are expensed as incurred.



Internally generated pharmaceutical development costs are
also expensed as incurred; they are not capitalized, because the criteria for capitalization are considered not to have been met until marketing approval for the related product has been obtained from the regulatory authorities. Recharges to or
contributions from alliance partners are recorded as a reduction in Research and development expenses.



Note B.4.1. Research and development not acquired in a business combination and Note B.4.3. Intangible assets acquired
in a business combination describe the principles applied to the recognition of separately acquired research and development.



B.17. Other operating income



Other operating incomeincludes the share of profits that sanofi-aventis is entitled to receive from alliance partners in
respect of product marketing agreements. It also includes revenues generated under certain complex agreements, which may include partnership and co-promotion agreements.



Upfront payments received are deferred for as long as a
service obligation remains. Milestone payments are assessed on a case by case basis, and recognized in the income statement on delivery of the products and/or provision of the services in question. Revenue generated in connection with these services
is recognized on the basis of delivery of the goods or provision of the services to the other contracting party.



This line also includes realized and unrealized foreign exchange gains and losses on operating activities (see Note B.8.4.), and operating
gains on disposals not regarded as major disposals (see Note B.20.).



B.18. Other operating expenses



Other operating expenses mainly comprise the share of profits that alliance partners are entitled to receive from sanofi-aventis under product marketing agreements.



B.19. Amortization and impairment of intangible assets



B.19.1. Amortization of intangible assets



The expenses recorded in this line item mainly comprise
amortization of product rights (see Note D.4.), which are presented as a separate item because the benefit of these rights to the Groups commercial, industrial and development functions cannot be separately identified.



Amortization of software is recognized as an expense in the
income statement, in the relevant line items of expense by function.



B.19.2. Impairment of intangible assets



This line item records impairment losses (other than those associated with restructuring) recognized against intangible assets (including goodwill), and any reversals of such impairment losses.



F-28



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



B.20. Restructuring costs and Gains and losses on disposals, and litigation



B.20.1. Restructuring costs



Restructuring costsinclude early retirement
benefits, compensation for early termination of contracts, and rationalization costs relating to restructured sites. Asset impairment losses directly attributable to restructuring are also recorded on this line. Restructuring costs included on this
line relate only to unusual and major restructuring plans.



B.20.2. Gains and losses on disposals, and litigation



This line item comprises gains and losses on major disposals of property, plant and equipment and intangible assets, and costs and
provisions related to major litigation.



B.21. Financial
expenses/income



B.21.1. Financial expenses



Financial expensesmainly
comprise interest charges on debt financing, negative changes in the fair value of financial instruments (where changes in fair value are taken to the income statement), realized and unrealized foreign exchange losses on financing and investing
activities, and impairment losses on financial instruments. They also include any reversals of impairment losses on financial instruments.



Financial expenses also include the expenses arising from the unwinding of discount on non-current provisions, except
provisions for retirement benefits and other long-term employee benefits. This line does not include cash discounts, which are deducted from net sales.



B.21.2. Financial income



Financial income includes interest and dividend income, positive changes in the fair value of financial instruments (where
changes in fair value are taken to the income statement), realized and unrealized foreign exchange gains on financing and investing activities, and gains or losses on disposals of financial assets.



B.22. Income tax expense



Income tax expense includes all current and
deferred taxes of consolidated companies.



Sanofi-aventis accounts for deferred taxes in accordance with IAS 12 (Income Taxes), using the methods described below.



Deferred tax assets and liabilities are recognized on taxable
and deductible temporary differences, and tax loss carry-forwards. Temporary differences are differences between the carrying amount of an asset or liability in the balance sheet and its tax base.



Reforms to French business taxes were enacted on
December 31, 2009 and apply as from January 1, 2010. The new tax, the CET (Contribution Economique Territoriale), has two components: the CFE (Cotisation Fonciere des Entreprises) and the CVAE (Cotisation sur la Valeur
Ajoutée des Entreprises). The second component is determined by applying a rate to the amount of value added generated by the business during the year.



Given that part of the CVAE component is calculated as the
amount by which certain revenues exceed certain expenses, and given that this tax will be borne primarily by companies that own intellectual property rights, on income derived from those rights (royalties, and margin on sales to third parties and to
other Group companies), sanofi-aventis regards the CVAE component as meeting the definition of income taxes specified in IAS 12, paragraph 2 (taxes which are based on taxable profits).



F-29



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Deferred tax assets and liabilities are calculated using the tax rate expected to apply
in the period when a temporary difference is expected to reverse, based on tax rates enacted or substantively enacted at the balance sheet date.



Unused tax losses and unused tax credits are recognized as deferred tax assets to the extent that it is probable that future taxable
profits will be available against which they can be utilized.



Sanofi-aventis recognizes a deferred tax liability for temporary differences relating to interests in subsidiaries, associates and joint ventures except when the Group is able to control the timing of the
reversal of the temporary differences. This applies in particular when the Group is able to control dividend policy and it is probable that the temporary differences will not reverse in the foreseeable future.



No deferred tax is recognized on eliminations of intragroup
transfers of interests in subsidiaries, associates or joint ventures.



For consolidation purposes, each tax entity calculates its own net deferred tax position. All net deferred tax asset and liability positions are then aggregated and shown as separate line items on the
assets and liabilities sides of the consolidated balance sheet respectively. Deferred tax assets and liabilities can be offset only if (i) the Group has a legally enforceable right to set off current tax assets and current tax liabilities, and
(ii) the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same taxation authority.



Deferred taxes are not discounted, except implicitly in the case of deferred taxes on assets and liabilities which are themselves
discounted.



Withholding taxes on intragroup
royalties and dividends, and on royalties and dividends collected from third parties, are accounted for as current income taxes.



In accounting for business combinations, the Group complies with the revised IFRS 3 as regards the recognition of deferred tax assets
after the initial accounting period. This means that the Group recognizes in profit or loss for the period any deferred tax assets recognized by the acquiree after the end of this period on temporary differences or tax loss carry-forwards existing
at the acquisition date. Under the pre-revision IFRS 3, applicable prior to January 1, 2010, such items were recognized as a reduction in the amount of goodwill.



Income tax expense includes the effect of tax
disputes, and any penalties and late payment interest arising from such disputes.



B.23. Employee benefit obligations



Sanofi-aventis offers retirement benefits to employees and retirees of the Group. These benefits are accounted for in accordance with IAS 19 (Employee Benefits).



These benefits are in the form of either defined-contribution
plans or defined-benefit plans.



In the case of
defined-contribution plans, the contributions paid by sanofi-aventis are expensed in the period in which they occur, and no actuarial estimate is performed.



In the case of defined-benefit plans, sanofi-aventis recognizes its obligations to employees as a liability, based on an actuarial
estimate of the rights vested and/or currently vesting in employees and retirees using the projected unit credit method. The amount of the liability is recognized net of the fair value of plan assets.



These estimates are performed at least once a year, and rely
on assumptions about life expectancy, employee turnover, and salary increases. The estimated obligation is discounted.



F-30



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



In the case of multi-employer defined-benefit plans where plan assets cannot be
allocated to each participating employer with sufficient reliability, the plan is accounted for as a defined-contribution plan, in accordance with paragraph 30 of IAS 19.



Obligations in respect of other post-employment benefits
(healthcare, life insurance) offered by Group companies to employees are also recognized as a liability based on an actuarial estimate of the rights vested or currently vesting in employees and retirees at the balance sheet date.



Actuarial gains and losses relating to defined-benefit plans
(pensions and other post-employment benefits), arising from the effects of changes in actuarial assumptions and experience adjustments, are recognized in equity net of deferred taxes via the consolidated statement of comprehensive income, under the
option allowed by the amendment to IAS 19. All unrecognized actuarial gains and losses at the transition date (January 1, 2004) were recognized in Equity attributable to equity holders of sanofi-aventis at that date in accordance
with the optional treatment allowed in IFRS 1.



Past service cost is recognized as an expense on a straight-line basis over the average period until the benefits become vested. If
benefits are already vested on the introduction of, or changes to, a defined-benefit plan, past service cost is recognized immediately as an expense.



Actuarial gains and losses and past service cost relating to other long-term employee benefits are recognized immediately in the income
statement.



B.24. Share-based payment



B.24.1. Stock option plans



Sanofi-aventis has granted a number of equity-settled,
share-based payment plans (stock option plans) to some of its employees.



In accordance with IFRS 2 (Share-Based Payment), services received from employees as consideration for stock options are recognized as an expense in the income statement, with the matching entry
recognized in equity. The expense corresponds to the fair value of the stock option plans, and is charged to income on a straight-line basis over the four-year vesting period of the plan.



The fair value of stock option plans is measured at the date of grant using the Black-Scholes valuation model,
taking into account the expected life of the options. The expense recognized in this evaluation takes into account the expected cancellation rate of the options. The expense is adjusted over the vesting period to reflect the actual cancellation
rates resulting from the departure of the holders of the options.



B.24.2. Employee share ownership plans



The sanofi-aventis Group may offer its employees the opportunity to subscribe to reserved share issues at a discount to the reference
market price. Shares allotted to employees under these plans fall within the scope of IFRS 2. The discount is measured at the subscription date and recognized as an expense, with no reduction for any lock-up period.



B.24.3. Restricted share plans



Sanofi-aventis may award restricted share plans to certain
of its employees. The terms of these plans may make the award contingent on performance criteria for some grantees.



In accordance with IFRS 2, an expense equivalent to the fair value of such plans is recognized on a straight line basis over the vesting
period of the plan, with the matching entry credited to equity. Depending on the country, the vesting period of such plans is either two or four years. Plans with a two-year vesting period are subject to a two-year lock-up period.



F-31



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The fair value of stock option plans is based on the fair value of the equity
instruments granted, representing the fair value of the services received during the vesting period. The fair value of an equity instrument granted under a plan is the market price of the share at the grant date, adjusted for expected dividends
during the vesting period.



B.25. Earnings per share



Basic earnings per share is calculated using
the weighted average number of shares outstanding during the reporting period, adjusted on a time-weighted basis from the acquisition date to reflect the number of sanofi-aventis shares held by the Group. Diluted earnings per share is calculated on
the basis of the weighted average number of ordinary shares, computed using the treasury stock method.



This method assumes that (a) all outstanding dilutive options and warrants are exercised, and (b) the Group acquires its own
shares at the quoted market price for an amount equivalent to the cash received as consideration for the exercise of the options or warrants, plus the expense arising on unamortized stock options.



In the event of a stock split or restricted share issue,
earnings per share for prior periods is adjusted accordingly.



B.26. Segment information



In accordance with IFRS 8 (Operating Segments), the segment information reported by sanofi-aventis is prepared on the basis of internal
management data provided to the Chief Executive Officer, who is the Groups chief operating decision maker. The performance of these segments is monitored individually using internal reports and common indicators.



Sanofi-aventis reports information for two operating
segments: Pharmaceuticals and Human Vaccines (Vaccines). All other activities are combined in a separate segment, Other. These segments reflect the Groups internal organizational structure, and are used internally for performance measurement
and resource allocation.



Information on operating
segments is provided in Note D.34. Split of net sales and Note D.35. Segment information.



B.27. Management of capital



In order to maintain or adjust the capital structure, the Group can adjust the amount of dividends paid to shareholders, or repurchase its own shares, or issue new shares, or issue securities giving
access to its capital.



The following objectives
are defined under the terms of the Groups share repurchase programs:



| |  | the implementation of any stock option plan giving entitlement to purchase shares in the sanofi-aventis parent company;
| | - | -----------------------------------------------------------------------------------------------------------------------



| |  | the allotment or sale of shares to employees under statutory profit-sharing schemes and employee savings plans;
| | - | ---------------------------------------------------------------------------------------------------------------



| |  | the award of restricted shares;
| | - | -------------------------------



| |  | the cancellation of some or all of the repurchased shares;
| | - | ----------------------------------------------------------



| |  | market-making in the secondary market in the shares by an investment services provider under a liquidity contract in compliance with the ethical code recognized by the
Autorité des marchés financiers;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | the delivery of shares on the exercise of rights attached to securities giving access to the capital by redemption, conversion, exchange, presentation of a warrant or
any other means;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | the delivery of shares (in exchange, as payment, or otherwise) in connection with mergers and acquisitions;
| | - | -----------------------------------------------------------------------------------------------------------



F-32



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



| |  | the execution by an investment services provider of purchases, sales or transfers by any means, in particular via off-market trading;
| | - | -------------------------------------------------------------------------------------------------------------------------------------



| |  | or any other purpose that is or may in the future be authorized under the applicable laws and regulations.
| | - | ----------------------------------------------------------------------------------------------------------



The Group is not subject to any constraints on equity capital
imposed by third parties.



The gearing ratio (the
ratio of debt, net of cash and cash equivalents to total equity) is a non-GAAP financial indicator used by management to measure overall net indebtedness and to manage the Groups equity capital.



Total equity includes Equity attributable to equity
holders of sanofi-aventis and Equity attributable to non-controlling interests, as shown on the consolidated balance sheet. Debt, net of cash and cash equivalents is defined as short-term debt plus long-term debt, plus related
interest rate and currency derivatives used to hedge debt, minus cash and cash equivalents.



For trends in this ratio, see Note D.17.



B.28. New IASB standards, amendments and interpretations applicable from 2011 onwards



New standards, amendments and interpretations applicable in 2010 with an impact on the consolidated financial statements are described in
Note A.2. New standards, amendments and interpretations applicable in 2010.



The note below describes standards, amendments and interpretations issued by the IASB that will be mandatorily applicable in 2011 or subsequent years, and the Groups position regarding future
application. None of these standards, amendments or interpretations has been early adopted by sanofi-aventis.



B.28.1. Standards and amendments applicable to the sanofi-aventis consolidated financial statements



In October 2010, the IASB issued an amendment to IFRS 7
(Financial Instruments: Disclosures). This amendment is applicable to annual periods beginning on or after July 1, 2011, and has not yet been endorsed by the European Union. It is intended to improve disclosure about transfers of financial
assets, in particular securitization transactions. It does not alter the way in which securitizations are currently accounted for, but specifies the disclosures that must be made.



In May 2010, the IASB issued the third Improvements to
IFRSs, as part of its annual process of revising and improving standards. This document has not yet been endorsed by the European Union. The amendments contained in this document do not contradict existing standards, but merely provide
clarification. Most of these amendments (applicable to annual periods beginning on or after July1, 2010) are intended to clarify how the revised IFRS 3 (Business Combinations) is to be applied, and to achieve consistency between the revised IFRS 3,
the amended IAS 27 (Consolidated and Separate Financial Statements), and other IASB pronouncements affected by the application of these two standards. Sanofi-aventis does not expect any material impact from the application of the 2010
Improvements to IFRSs, which also contains an amendment to IAS 34 (Interim Financial Reporting), applicable to annual periods beginning on or after January 1, 2011. This amendment requires interim financial reports to include an
explanation of events and transactions that are significant to an understanding of changes in the financial position and performance of the reporting entity.



In late 2009, the IASB issued the following standards and amendments, of which only IFRS 9 (Financial Instruments) has not yet been
endorsed by the European Union:



| |  |  | Amendment to IAS 24 (Related Party Disclosures). This amendment, applicable to annual periods beginning on or after January 1, 2011, sets out the
disclosure requirements in respect of future
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-33



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



| | commitments related to a particular event involving related parties. Sanofi-aventis already discloses such information. The amendment also simplified the disclosure requirements for
government-related entities; this part of the amendment does not apply to sanofi-aventis.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | IFRS 9 (Financial Instruments). This standard is applicable to annual periods beginning on or after January 1, 2013, and completes the first of
the three phases of the IASB financial instruments project. The next two phases will deal with Financial Instruments: Amortized Cost and Impairment and Hedge Accounting. Final completion of IFRS 9 is scheduled for the first
half of 2011. The three phases of IFRS 9 are intended to replace IAS 39 (Financial Instruments: Recognition and Measurement). The Group will assess the overall impact of IFRS 9 once all the phases have been published.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Amendment to IAS 32 (Financial Instruments: Presentation), on the classification of rights issues. This amendment is applicable to annual periods
beginning on or after February 1, 2010, and deals with issues of subscription rights in a currency other than the issuers functional currency. To date, such issues have been accounted for as derivatives (i.e. as a liability). Under the
amendment, subscription rights must be recognized as equity when certain conditions are met, irrespective of the currency in which the exercise price is expressed. Because sanofi-aventis has not issued any instruments of this type, this amendment
does not apply to the consolidated financial statements.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In December 2010, the IASB issued the following amendments, which have not yet been endorsed by the European Union:



| |  |  | Amendment to IAS 12 (Income Taxes). This amendment, applicable to annual periods beginning on or after January 1, 2012, provides a practical
approach for measuring deferred tax liabilities and deferred tax assets when investment property is measured using the fair value model in IAS 40 (Investment Property). Because sanofi-aventis does not own any investment property measured in
accordance with IAS 40, this amendment does not apply to the consolidated financial statements.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Amendments to IFRS 1 (First-Time Adoption of International Financial Reporting Standards). Two amendments to IFRS 1 have been issued. The first allows
first-time adopters to derecognize their financial assets and financial liabilities prospectively at the date of transition to IFRS, rather than from the fixed date (January 1, 2004) initially stipulated in IFRS 1. Such derecognition must comply
with IAS 39 (Financial Instruments: Recognition and Measurement). The second gives guidance on how an entity should present IFRS financial statements after a period during which it has been unable to do so because of severe hyperinflation. These
amendments are applicable to annual periods beginning on or after July 1, 2011, but because they apply solely to first-time adopters of IFRS they have no impact on the sanofi-aventis consolidated financial statements.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



B.28.2. New interpretations



The IASB has also issued the following interpretations,
which are mandatorily applicable from 2011 onwards and had been endorsed by the European Union at the balance sheet date:



| |  |  | IFRIC 19 (Extinguishing Financial Liabilities with Equity Instruments). This interpretation, which applies to annual periods beginning on or after
July 1, 2010, addresses the classification and measurement methods to be used by an entity when the terms of a financial liability are renegotiated and result in the entity issuing equity instruments to a creditor to extinguish all or part of
the financial liability. Given the absence of any transaction falling within the scope of this interpretation, IFRIC 19 does not apply to the sanofi-aventis consolidated financial statements.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Amendment to IFRIC 14 (IAS 19  The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction). This amendment,
applicable to annual periods beginning on or after January 1, 2011, clarifies the accounting treatment of voluntary prepayments intended to meet minimum funding requirements. It will be applicable from 2011 onwards, and has no impact on the
sanofi-aventis consolidated financial statements.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-34



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



C. ALLIANCES



C.1. Alliance arrangements with Bristol-Myers Squibb (BMS)



Two of the Groups
leading products were jointly developed with BMS: the anti-hypertensive agent irbesartan (Aprovel®/Avapro®/Karvea® ) and the anti-atherothrombosis treatment clopidogrel bisulfate (Plavix®/Iscover®).



As inventor of the two molecules,
sanofi-aventis is paid a royalty on all sales generated by these products. The portion of this royalty received by sanofi-aventis on sales generated by BMS in territories under the operational management of BMS (see below) is recorded in Other
revenues. As co-developers of the products, sanofi-aventis and BMS each receive equal development royalties from their two licensees, which have been responsible, since 1997, for marketing the products using their local distribution
networks, composed of subsidiaries of both groups. These licensees operate in two separate territories: (i) Europe, Africa, Asia and the Middle East, under the operational management of sanofi-aventis; and (ii) other countries (excluding
Japan), under the operational management of BMS. In Japan, Aprovel® has since June 2008 been marketed jointly by
Shionogi Pharmaceuticals and Dainippon Sumitomo Pharma Co. Ltd. The alliance with BMS does not cover the rights to
Plavix® in Japan, where the product is marketed by sanofi-aventis.



The products are marketed in different ways in different
countries.



Co-promotion consists of a pooling of
sales resources under a single brand name, and is preferably achieved through contracts or through appropriate tax-transparent legal entities. Each partner records directly its share of taxable income.



Co-marketing consists of separate marketing of the products
by each local affiliate using its own name and resources under different brand names for the product.



In certain countries of Eastern Europe, Africa, Asia, Latin America and the Middle East, the products are marketed on an exclusive basis
by sanofi-aventis.



In the territory managed by
sanofi-aventis, operations are recognized by the Group as follows:



| | (i) | In most countries of Western Europe and in some Asian countries (excluding Japan) for clopidogrel bisulfate (Plavix®/Iscover®) only, co-promotion is used for both products. The legal entities used are partnerships (sociétés en participation) or other tax-transparent
entities, which are majority-owned by and under the operational management of the Group. Sanofi-aventis recognizes all the revenue associated with the sale of the drugs, as well as the corresponding expenses. The share of profits reverting to BMS
subsidiaries is shown in Net income attributable to non-controlling interests in the income statement, with no tax effect (because BMS receives a pre-tax share of profits).
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | The line item Non-controlling interests, excluding BMS in the consolidated statement of cash flows takes account of the specific terms of the alliance
agreement.
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (ii) | In Germany, Spain and Greece, and in Italy for irbesartan (Aprovel®/Avapro®/ Karvea®) only, co-marketing is used for both products, and sanofi-aventis recognizes revenues and expenses generated by its
own operations.
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (iii) | In those countries in Eastern Europe, Africa, the Middle East and Asia (excluding Japan) where the products are marketed exclusively by sanofi-aventis,
the Group recognizes revenues and expenses generated by its own operations. Sanofi-aventis has had the exclusive right to market Aprovel® in Scandinavia and in Ireland since September 2006, and the exclusive right to market Plavix® in Malaysia since January 1, 2010.
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In the territory managed by BMS, operations are recognized by the Group as follows:



| | (i) | Co-promotion is used in the United States, Canada and Puerto Rico through entities that are majority-owned by and under the operational management of
BMS. Sanofi-aventis does not recognize revenues;
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-35



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



| | rather, it invoices the entity for its promotion expenses, records its royalty income in Other revenues, and records its share of profits (net of tax) in Share of profit/loss
of associates and joint ventures.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (ii) | In Brazil, Mexico, Argentina and Australia for clopidogrel bisulfate (Plavix®/Iscover®) and for irbesartan
(Aprovel®/Avapro®/Karvea® ) and in Colombia for
clopidogrel bisulfate only, co-marketing is used, and sanofi-aventis recognizes revenues and expenses generated by its own operations.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (iii) | In certain other Latin American countries, where the products are marketed exclusively by sanofi-aventis, the Group recognizes revenues and expenses generated by its
own operations.
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



C.2. Alliance agreements with
Warner Chilcott (previously with Procter & Gamble Pharmaceuticals, the Alliance Partner)



Actonel® (risedronate sodium) is a new-generation biphosphonate indicated for the treatment and prevention of osteoporosis. Historically, Actonel® was developed and marketed in collaboration with Procter & Gamble Pharmaceuticals. Procter &
Gamble sold its pharmaceuticals interests to Warner Chilcott on October 30, 2009. Consequently, Actonel®
has since that date been marketed in collaboration with Warner Chilcott.



This alliance agreement covers the worldwide development and marketing of the product, except for Japan for which sanofi-aventis holds no rights.



Local marketing arrangements may take various forms:



| |  |  | Co-promotion, whereby sales resources are pooled but only one of the two parties to the alliance agreement (sanofi-aventis or the Alliance Partner)
invoices product sales. Co-promotion is carried out under contractual agreements and is not based on any specific legal entity. The Alliance Partner sells the product and incurs all the related costs in France and Canada. This co-promotion scheme
also included Germany, Belgium and Luxembourg until December 31, 2007, the Netherlands until March 31, 2008, and the United States and Puerto Rico until March 31, 2010. Sanofi-aventis recognizes its share of revenues under the
agreement as a component of operating income on the Other operating income line. Since April 1, 2010, sanofi-aventis has received royalties from the Alliance Partner on sales made by the Alliance Partner in the United States and
Puerto Rico. In the secondary co-promotion territories (the United Kingdom until December 31, 2008, Ireland, Sweden, Finland, Greece, Switzerland, Austria, Portugal and Australia) sanofi-aventis sells the product, and recognizes all the
revenues from sales of the product along with the corresponding expenses. The share due to the Alliance Partner is recognized in Cost of sales.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Co-marketing, which applies in Italy, whereby each party to the alliance agreement sells the product in the country under its own name, and recognizes
all revenue and expenses from its own operations in its income statement. Each company also markets the product independently under its own brand name in Spain, although Spain is not included in the co-marketing territory.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The product has been marketed by the Alliance Partner independently in Germany, Belgium and Luxembourg since January 1, 2008; in the Netherlands
since April 1, 2008; and in the United Kingdom since January 1, 2009. Sanofi-aventis recognizes its share of revenues under the alliance agreement in Other operating income.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In all other territories, sanofi-aventis has exclusive rights to sell the product and recognizes all revenue and expenses from its own operations in
its income statement, but in return for these exclusive rights pays the Alliance Partner a royalty based on actual sales. This royalty is recognized in Cost of sales.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Sanofi-aventis and Warner Chilcott have begun negotiations on
the future of their alliance arrangements.



F-36



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



D. DETAILED NOTES TO THE FINANCIAL STATEMENTS



D.1. Significant acquisitions



Business combinations, completed on or after January 1,
2010, are accounted for using the acquisition method in accordance with the revised IFRS 3. The accounting policies applicable to business combinations are described in Note B.3.1.



D.1.1. Principal acquisitions during 2010



- TargeGen, Inc. (TargeGen)



In July 2010, sanofi-aventis acquired 100% of the capital of
TargeGen, Inc., a U.S. biopharmaceutical company developing small molecule kinase inhibitors for the treatment of certain forms of leukemia, lymphoma and other hematological malignancies and blood disorders. An upfront payment of $75 million was
made on completion. Future milestone payments may be made at various stages in the development of TG 101348, TargeGens principal product candidate. The total amount of payments (including the upfront payment) could reach $560 million.



The provisional purchase price allocation of
TargeGen is shown below:



|                                   |  |                |    |  |                         |  |     |           |  |  |     |  
|---------------------------------- |  | -------------- | -- |  | ----------------------- |  | --- | --------- |  |  | --- | -
|($ million)                        |  | Historicalcost |    |  | Fair valueremeasurement |  |     | Fairvalue | 
|Intangible assets(1)               |  |                |   |  |                         |  | 230 |           |  |  | 230 |  
|Deferred taxes                     |  |                | 53 |  |                         |  | (83 | )         |  |  | (30 | )
|Other assets and liabilities       |  |                | 1  |  |                         |  |    |           |  |  | 1   |  
|Net assets of TargeGen (July 2010) |  |                | 54 |  |                         |  | 147 |           |  |  | 201 |  
|Goodwill                           |  |                |    |  |                         |  |     |           |  |  |    |  
|Purchase price(2)                  |  |                |    |  |                         |  |     |           |  |  | 201 |  



|(1) | TG 101348, a product currently in the development phase.
|--- | --------------------------------------------------------

|(2) | Includes the estimated contingent consideration relating to potential future
milestone payments (see Note D.18.).
|--- | -----------------------------------------------------------------------------------------------------------------



- Chattem, Inc. (Chattem)



On February 9, 2010, sanofi-aventis acquired Chattem, Inc. by successfully completing a cash tender offer. Headquartered in Chattanooga (United States), Chattem is a major consumer health player in
the United States, producing and distributing 26 branded consumer health products, toiletries and dietary supplements across various market segments. Chattem will manage the Allegra® brand, and act as the platform for sanofi-aventis over-the-counter and consumer health products in the United States. As of December 31, 2010, sanofi-aventis
held 100% of the outstanding shares of Chattem.



The provisional purchase price allocation of Chattem is shown below:



|                                             |  |                |      |   |                         |  |      |            |  |  |       |       
|-------------------------------------------- |  | -------------- | ---- | - | ----------------------- |  | ---- | ---------- |  |  | ----- | ------
|($ million)                                  |  | Historicalcost |      |   | Fair valueremeasurement |  |      | Fair
value | 
|Intangible assets                            |  |                | 576  |   |                         |  | 967  |            |  |  | 1,543 |       
|Property, plant and equipment                |  |                | 38   |   |                         |  | 3    |            |  |  | 41    |       
|Inventories                                  |  |                | 48   |   |                         |  | 29   |            |  |  | 77    |       
|Deferred taxes                               |  |                | (2   | ) |                         |  | (376 | )          |  |  | (378  | )     
|Long-term and short-term debt                |  |                | (377 | ) |                         |  | (114 | )          |  |  | (491  | )     
|Other assets and liabilities                 |  |                | (65  | ) |                         |  | (15  | )          |  |  | (80   | )     
|Net assets of Chattem as of February 9, 2010 |  |                | 218  |   |                         |  | 494  |            |  |  | 712   |       
|Goodwill                                     |  |                |      |   |                         |  |      |            |  |  | 1,064 |       
|Purchase price                               |  |                |      |   |                         |  |      |            |  |  | 1,776 | (1)(2)



|(1) | Acquisition-related costs recognized directly in profit or loss amounted to $16
million.
|--- | ----------------------------------------------------------------------------------------

|(2) | Resulting in a net cash outflow of 1,277 million.
|--- | --------------------------------------------------



F-37



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Since the acquisition date, Chattem has generated net sales of 328 million
and business net income (see definition in Note D.35.) of 110 million, and has made a negative contribution of 5 million to net income (including expenses recognized during the period in connection with the fair value
remeasurement of the companys assets at the acquisition date).



D.1.2. Other principal business combinations in the year ended December 31, 2010



| |  | The acquisition in April 2010 of a controlling interest in the capital of Bioton Vostok, a Russian insulin manufacturer. Under the terms of the agreement, put options
were granted to non-controlling interests (see Note D.18. Liabilities related to business combinations and to non-controlling interests).
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | The formation in May 2010 of a joint venture with Nichi-Iko Pharmaceuticals Co. Ltd. (Nichi-Iko), a leading player in the Japanese generics market, to expand generics
activities in the country. As well as forming this joint venture, sanofi-aventis also took a 4.66% equity interest in the capital of Nichi-Iko (see Note D.7.).
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | The acquisition in June 2010 of the cosmetics and skincare products distribution activities of the Canadian company Canderm Pharma, Inc. This business generated CAD
24 million of net sales in 2009.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | The acquisition in August 2010 of a 100% equity interest in the Polish company Nepentes S.A. for a consideration of PLN 425 million (106 million), aimed at
diversifying the sanofi-aventis consumer health portfolio in Poland, and in Central and Eastern Europe generally.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | The acquisition in October 2010 of VaxDesign, a U.S. biotechnology company which has developed a technology for in vitro modeling of the human immune system that can be
used to select the best candidate vaccines at the pre-clinical stage. Under the terms of the agreement, an upfront payment of $55 million was made upon closing of the transaction, and a further $5 million will be payable upon completion of a
specified development milestone.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | The acquisition in October 2010 of a 60% equity interest in the Chinese company Hangzhou Sanofi Minsheng Consumer Healthcare Co. Ltd, in partnership with Minsheng
Pharmaceutical Co., Ltd., with sanofi-aventis also granting the alliance partner a put option over the remaining shares not held by sanofi-aventis (see Note D.18.).
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



D.1.3. Principal acquisitions during 2009



- Merial



The acquisition by sanofi-aventis of the equity interest
held by Merck & Co., Inc. in Merial Limited (Merial) was completed on September 17, 2009. Consequently, the twelve-month purchase price allocation period ended in September 2010. Detailed information about the impact of Merial on the
sanofi-aventis consolidated financial statements for the year ended December 31, 2010 is provided in Note D.8. Assets held for sale or exchange.



The final purchase price allocation is set forth in the table
below:



|                                                            |  |  |       |  |                |  |       |                         |  |  |           |   |  |  |        |  
|----------------------------------------------------------- |  |  | ----- |  | -------------- |  | ----- | ----------------------- |  |  | --------- | - |  |  | ------ | -
|($ million)                                                 |  |  |       |  | Historicalcost |  |       | Fair valueremeasurement |  |  | Fairvalue |  
|Intangible assets                                           |  |  |       |  |                |  | 147   |                         |  |  | 5,153     |   |  |  | 5,300  |  
|Property, plant and equipment                               |  |  |       |  |                |  | 740   |                         |  |  | 130       |   |  |  | 870    |  
|Inventories                                                 |  |  |       |  |                |  | 492   |                         |  |  | 241       |   |  |  | 733    |  
|Deferred taxes                                              |  |  |       |  |                |  | 53    |                         |  |  | (1,440    | ) |  |  | (1,387 | )
|Other assets and liabilities                                |  |  |       |  |                |  | 264   |                         |  |  | (46       | ) |  |  | 218    |  
|Net assets of Merial as of September 17, 2009               |  |  | a     |  |                |  | 1,696 |                         |  |  | 4,038     |   |  |  | 5,734  |  
|Share of net assets acquired as of September 17, 2009 (50%) |  |  | b     |  |                |  |       |                         |  |  |           |   |  |  | 2,867  |  
|Goodwill (September 17, 2009 transaction)                   |  |  | c     |  |                |  |       |                         |  |  |           |   |  |  | 1,169  |  
|Purchase price(1)                                           |  |  | d=b+c |  |                |  |       |                         |  |  |           |   |  |  | 4,036  |  



|(1) | Includes acquisition-related costs of $36 million
|--- | -------------------------------------------------



F-38



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The fair value of Merial as of September 17, 2009, as reported in the
sanofi-aventis consolidated financial statements after adjustments to the purchase price allocation, breaks down as follows:



|                                                                                                                                                           |  |  |   |  |            |  |       | 
|---------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  | - |  | ---------- |  | ----- | 
|($ million)                                                                                                                                                |  |  |   |  | Fair value | 
|Purchase price                                                                                                                                             |  |  | d |  |            |  | 4,036 | 
|+ Carrying amount of the previously-held equity interest in Merial (equity method)                                                                         |  |  |   |  |            |  | 1,765 | 
|+ Remeasurement of the previously-held equity interest (50%), excluding goodwill(1)                                                                        |  |  |   |  |            |  | 1,551 | 
|Total value of Merial in the sanofi-aventis consolidated financial statements as of
September 17, 2009, after adjustments to the purchase price allocation |  |  |   |  |            |  | 7,352 | 
|Comprising:                                                                                                                                                |  |  |   |  |            |  |       | 
| Net assets of Merial as of September 17, 2009                                                                                                            |  |  | a |  |            |  | 5,734 | 
| Goodwill (September 17, 2009)                                                                                                                            |  |  | c |  |            |  | 1,169 | 
| Goodwill (August 20, 2004)                                                                                                                               |  |  |   |  |            |  | 449   | 



|(1) | Adjusted by $193 million during the purchase price allocation period.
|--- | ---------------------------------------------------------------------



- BiPar



On April 27, 2009, sanofi-aventis
acquired 100% of BiPar Sciences (BiPar), an American biopharmaceutical company developing novel tumorselective approaches for the treatment of different types of cancers. BiPar is the leading company in the emerging field of DNA (DeoxyriboNucleic
Acid) repair using Poly ADP-Ribose Polymerase (PARP) inhibitors. The purchase price is contingent on the achievement (regarded as probable) of milestones related to the development of BSI-201, and could reach $500 million. The amount of contingent
consideration recognized in the balance sheet as at December 31, 2010 is disclosed in Note D.18. Liabilities related to business combinations and to non-controlling interests. The final purchase price allocation for this acquisition
was not materially different from the provisional allocation.



- Medley



On April 27, 2009, sanofi-aventis acquired a 100% equity interest in Medley, the third largest pharmaceutical company in Brazil and a leading generics company in that country. The purchase price,
based on an enterprise value of 500 million, was 348 million inclusive of acquisition-related costs. The final purchase price allocation for this acquisition was not materially different from the provisional allocation, and the
final amount of goodwill recognized was 376 million.



- Zentiva



On March 11, 2009, sanofi-aventis successfully closed its offer for Zentiva N.V. (Zentiva). As of December 31, 2009, sanofi-aventis held about 99.1% of Zentivas share capital. The purchase
price was 1,200 million, including acquisition-related costs. The final purchase price allocation for this acquisition was not materially different from the provisional allocation, and the final amount of goodwill recognized was 886
million. Following the buyout of the remaining non-controlling interests, sanofi-aventis held a 100% equity interest in Zentiva as of December 31, 2010.



Previously, sanofi-aventis held a 24.9% interest in Zentiva, which was accounted for as an associate by the equity method (see Note D.6.).



- Shantha Biotechnics



In August 2009, sanofi-aventis took
control of Shantha Biotechnics (Shantha), a vaccines company based in Hyderabad (India), by acquiring the shares of ShanH, the owner of Shantha. In the purchase price allocation, identifiable intangible assets other than goodwill were measured at a
fair value of 374 million. This amount includes the acquisition-date value of the Shan5® pentavalent
vaccine, which was partially written down in 2010 (see Note D.5.).



F-39



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



D.1.4. Other principal business combinations in the year ended December 31, 2009



| |  | Fovea Pharmaceuticals SA (Fovea), a privately-held French biopharmaceutical research and development company specializing in ophthalmology, acquired October 30,
2009. The purchase consideration is contingent on milestone payments of up to 280 million linked to the development of three products. The amount of contingent consideration recognized in the balance sheet as at December 31, 2010 is
disclosed in Note D.18. Liabilities related to business combinations and to non-controlling interests.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | Oenobiol (November 2009), one of Frances leading players in health and beauty dietary supplements.
| | - | ---------------------------------------------------------------------------------------------------



| |  | Laboratorios Kendrick (March 2009), one of Mexicos leading manufacturers of generics.
| | - | --------------------------------------------------------------------------------------



| |  | Helvepharm (July 2009), a Swiss generics company.
| | - | -------------------------------------------------



D.1.5. Principal acquisitions during 2008



- Acambis



In September 2008, sanofi-aventis completed the acquisition of Acambis plc for £285 million. Acambis plc became Sanofi Pasteur
Holding Ltd, a wholly-owned subsidiary of Sanofi Pasteur Holding S.A. This company develops novel vaccines that address unmet medical needs or substantially improve current standards of care. Sanofi Pasteur and Acambis plc had already been
developing vaccines in a successful partnership of more than a decade: Acambis plc had been conducting major projects under exclusive collaboration agreements with sanofi pasteur, for vaccines against dengue fever and Japanese encephalitis (see Note
D.4.).



- Symbion Consumer



In September 2008, sanofi-aventis completed the acquisition
of the Australian company Symbion CP Holdings Pty Ltd (Symbion Consumer) for AUD 560 million. Symbion Consumer manufactures, markets and distributes nutraceuticals (vitamins and mineral supplements) and over the counter brands throughout Australia
and New Zealand. Symbion Consumer has a portfolio of brands including Natures Own, Cenovis, Bio-organics, Golden Glow and Microgenics (see Note D.4.).



In accordance with the pre-revision IFRS 3 (see Note B.3.1.), adjustments to the acquisition cost of business combinations completed prior
to January 1, 2010 (Fovea, Shantha, Medley)  in particular those contingent upon future events  have been recognized as adjustments to goodwill.



D.2. Divestments



No material divestments occurred during 2010, 2009 or 2008.



F-40



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



|D.3. | Property, plant and equipment
|---- | -----------------------------



Property, plant and equipment (including assets held under finance leases) comprise:



|                                                           |  |      |     |   |           |  |        |                  |  |  |                           |   |  |                                        |        |   |       |  |        |   |  |  |        |  
|---------------------------------------------------------- |  | ---- | --- | - | --------- |  | ------ | ---------------- |  |  | ------------------------- | - |  | -------------------------------------- | ------ | - | ----- |  | ------ | - |  |  | ------ | -
|( million)                                                |  | Land |     |   | Buildings |  |        | Plant &equipment |  |  | Fixtures,fittings & other |   |  | Property, plantand equipmentin process |        |   | Total | 
|Gross value at January 1, 2008                             |  |      | 213 |   |           |  | 2,994  |                  |  |  | 4,498                     |   |  |                                        | 1,382  |   |       |  | 1,291  |   |  |  | 10,378 |  
|Changes in scope of consolidation                          |  |      | 5   |   |           |  | 13     |                  |  |  | 9                         |   |  |                                        |       |   |       |  | 12     |   |  |  | 39     |  
|Acquisitions and other increases                           |  |      |    |   |           |  | 30     |                  |  |  | 55                        |   |  |                                        | 67     |   |       |  | 1,207  |   |  |  | 1,359  |  
|Disposals and other decreases                              |  |      | (4  | ) |           |  | (6     | )                |  |  | (4                        | ) |  |                                        | (58    | ) |       |  | (1     | ) |  |  | (73    | )
|Translation differences                                    |  |      | (7  | ) |           |  | (46    | )                |  |  | (80                       | ) |  |                                        | (22    | ) |       |  | 13     |   |  |  | (142   | )
|Transfers                                                  |  |      | 8   |   |           |  | 315    |                  |  |  | 501                       |   |  |                                        | 176    |   |       |  | (1,010 | ) |  |  | (10    | )
|Gross value at December 31, 2008                           |  |      | 215 |   |           |  | 3,300  |                  |  |  | 4,979                     |   |  |                                        | 1,545  |   |       |  | 1,512  |   |  |  | 11,551 |  
|Changes in scope of consolidation                          |  |      | 61  |   |           |  | 245    |                  |  |  | 199                       |   |  |                                        | 26     |   |       |  | 13     |   |  |  | 544    |  
|Acquisitions and other increases                           |  |      | 1   |   |           |  | 32     |                  |  |  | 87                        |   |  |                                        | 63     |   |       |  | 1,170  |   |  |  | 1,353  |  
|Disposals and other decreases                              |  |      | (3  | ) |           |  | (22    | )                |  |  | (23                       | ) |  |                                        | (157   | ) |       |  | (17    | ) |  |  | (222   | )
|Translation differences                                    |  |      | 6   |   |           |  | 26     |                  |  |  | 24                        |   |  |                                        | 5      |   |       |  | 4      |   |  |  | 65     |  
|Transfers                                                  |  |      | (5  | ) |           |  | 463    |                  |  |  | 581                       |   |  |                                        | 122    |   |       |  | (1,348 | ) |  |  | (187   | )
|Gross value at December 31, 2009                           |  |      | 275 |   |           |  | 4,044  |                  |  |  | 5,847                     |   |  |                                        | 1,604  |   |       |  | 1,334  |   |  |  | 13,104 |  
|Changes in scope of consolidation                          |  |      | 1   |   |           |  | 29     |                  |  |  | 15                        |   |  |                                        | 5      |   |       |  | 7      |   |  |  | 57     |  
|Acquisitions and other increases                           |  |      | 1   |   |           |  | 12     |                  |  |  | 57                        |   |  |                                        | 71     |   |       |  | 1,058  |   |  |  | 1,199  |  
|Disposals and other decreases                              |  |      | (3  | ) |           |  | (14    | )                |  |  | (12                       | ) |  |                                        | (124   | ) |       |  |       |   |  |  | (153   | )
|Translation differences                                    |  |      | 11  |   |           |  | 172    |                  |  |  | 134                       |   |  |                                        | 38     |   |       |  | 31     |   |  |  | 386    |  
|Transfers                                                  |  |      | (11 | ) |           |  | 312    |                  |  |  | 482                       |   |  |                                        | 76     |   |       |  | (1,076 | ) |  |  | (217   | )
|Gross value at December 31, 2010                           |  |      | 274 |   |           |  | 4,555  |                  |  |  | 6,523                     |   |  |                                        | 1,670  |   |       |  | 1,354  |   |  |  | 14,376 |  
|Accumulated depreciation & impairment at January 1, 2008   |  |      | (3  | ) |           |  | (888   | )                |  |  | (1,976                    | ) |  |                                        | (940   | ) |       |  | (33    | ) |  |  | (3,840 | )
|Depreciation expense                                       |  |      |    |   |           |  | (205   | )                |  |  | (476                      | ) |  |                                        | (161   | ) |       |  |       |   |  |  | (842   | )
|Impairment losses                                          |  |      | (1  | ) |           |  | (17    | )                |  |  | (14                       | ) |  |                                        | (5     | ) |       |  | (4     | ) |  |  | (41    | )
|Disposals                                                  |  |      |    |   |           |  |       |                  |  |  |                          |   |  |                                        | 50     |   |       |  |       |   |  |  | 50     |  
|Translation differences                                    |  |      |    |   |           |  | 11     |                  |  |  | 46                        |   |  |                                        | 13     |   |       |  |       |   |  |  | 70     |  
|Transfers                                                  |  |      |    |   |           |  | 6      |                  |  |  | 20                        |   |  |                                        | (13    | ) |       |  |       |   |  |  | 13     |  
|Accumulated depreciation & impairment at December 31, 2008 |  |      | (4  | ) |           |  | (1,093 | )                |  |  | (2,400                    | ) |  |                                        | (1,056 | ) |       |  | (37    | ) |  |  | (4,590 | )
|Depreciation expense                                       |  |      |    |   |           |  | (238   | )                |  |  | (530                      | ) |  |                                        | (161   | ) |       |  |       |   |  |  | (929   | )
|Impairment losses                                          |  |      | (4  | ) |           |  | (73    | )                |  |  | (22                       | ) |  |                                        | (4     | ) |       |  | (5     | ) |  |  | (108   | )
|Disposals                                                  |  |      | 2   |   |           |  | 12     |                  |  |  | 24                        |   |  |                                        | 148    |   |       |  | 2      |   |  |  | 188    |  
|Translation differences                                    |  |      |    |   |           |  | (4     | )                |  |  | (16                       | ) |  |                                        | (3     | ) |       |  |       |   |  |  | (23    | )
|Transfers                                                  |  |      | 3   |   |           |  | 87     |                  |  |  | 103                       |   |  |                                        | (5     | ) |       |  |       |   |  |  | 188    |  
|Accumulated depreciation & impairment at December 31, 2009 |  |      | (3  | ) |           |  | (1,309 | )                |  |  | (2,841                    | ) |  |                                        | (1,081 | ) |       |  | (40    | ) |  |  | (5,274 | )
|Depreciation expense                                       |  |      |    |   |           |  | (298   | )                |  |  | (623                      | ) |  |                                        | (167   | ) |       |  |       |   |  |  | (1,088 | )
|Impairment losses                                          |  |      | (4  | ) |           |  | (29    | )                |  |  | 12                        |   |  |                                        | (2     | ) |       |  | (6     | ) |  |  | (29    | )
|Disposals                                                  |  |      |    |   |           |  | 10     |                  |  |  | 1                         |   |  |                                        | 114    |   |       |  |       |   |  |  | 125    |  
|Translation differences                                    |  |      |    |   |           |  | (66    | )                |  |  | (67                       | ) |  |                                        | (24    | ) |       |  |       |   |  |  | (157   | )
|Transfers                                                  |  |      | 5   |   |           |  | 140    |                  |  |  | 42                        |   |  |                                        | 11     |   |       |  | 4      |   |  |  | 202    |  
|Accumulated depreciation & impairment at December 31, 2010 |  |      | (2  | ) |           |  | (1,552 | )                |  |  | (3,476                    | ) |  |                                        | (1,149 | ) |       |  | (42    | ) |  |  | (6,221 | )
|Carrying amount: January 1, 2008                           |  |      | 210 |   |           |  | 2,106  |                  |  |  | 2,522                     |   |  |                                        | 442    |   |       |  | 1,258  |   |  |  | 6,538  |  
|Carrying amount: December 31, 2008                         |  |      | 211 |   |           |  | 2,207  |                  |  |  | 2,579                     |   |  |                                        | 489    |   |       |  | 1,475  |   |  |  | 6,961  |  
|Carrying amount: December 31, 2009                         |  |      | 272 |   |           |  | 2,735  |                  |  |  | 3,006                     |   |  |                                        | 523    |   |       |  | 1,294  |   |  |  | 7,830  |  
|Carrying amount: December 31, 2010                         |  |      | 272 |   |           |  | 3,003  |                  |  |  | 3,047                     |   |  |                                        | 521    |   |       |  | 1,312  |   |  |  | 8,155  |  



F-41



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The Transfers line for the years ended December 31, 2010 and 2009
mainly comprises reclassifications of assets to Assets held for sale or exchange.



Property, plant and equipment pledged as security for liabilities amounted to 26 million as of December 31, 2010 (15 million as of December 31, 2009 and 10 million as
of December 31, 2008).



Following impairment
tests conducted on property, plant and equipment using the method described in Note B.6., an impairment loss of 53 million was recognized in the year ended December 31, 2010 (mainly in respect of a site designated as held for sale),
along with an impairment loss reversal of 24 million. In the year ended December 31, 2009, an impairment loss of 107 million was recognized on sites designated as held for sale (principally, Alnwick in the United Kingdom and
Porcheville in France); see Note D.8.2. In the year ended December 31, 2008, an impairment loss of 41 million was recognized, primarily on industrial sites in France and the United States.



Acquisitions made in the Pharmaceuticals segment related
primarily to investments in industrial facilities (471 million in 2010, versus 496 million in 2009 and 501 million in 2008) and in facilities and equipment at research sites (159 million in 2010, versus
325 million in 2009 and 376 million in 2008). Acquisitions in the Vaccines segment totaled 423 million in 2010 (compared with 446 million in 2009 and 382 million in 2008). Capitalized borrowing
costs amounting to 27 million were included in acquisitions of property, plant and equipment in 2010, versus 30 million in 2009 and 24 million in 2008. Firm orders for property, plant and equipment amounted to
321 million at December 31, 2010, versus 351 million at December 31, 2009 and 450 million at December 31, 2008.



The table below shows amounts for items of property, plant and equipment held under finance leases:



|                                        |  |                  |     |   |                  |  |     |                  |  |  |     |  
|--------------------------------------- |  | ---------------- | --- | - | ---------------- |  | --- | ---------------- |  |  | --- | -
|( million)                             |  | December 31,2010 |     |   | December 31,2009 |  |     | December 31,2008 | 
|Land                                    |  |                  | 7   |   |                  |  | 7   |                  |  |  | 7   |  
|Buildings                               |  |                  | 84  |   |                  |  | 99  |                  |  |  | 99  |  
|Other property, plant and equipment     |  |                  | 15  |   |                  |  | 6   |                  |  |  | 7   |  
|Total gross value                       |  |                  | 106 |   |                  |  | 112 |                  |  |  | 113 |  
|Accumulated depreciation and impairment |  |                  | (78 | ) |                  |  | (81 | )                |  |  | (83 | )
|Carrying amount                         |  |                  | 28  |   |                  |  | 31  |                  |  |  | 30  |  



Future minimum lease payments due under finance leases at December 31, 2010 were 28 million (versus 27 million
at December 31, 2009 and 31 million at December 31, 2008), including interest of 3 million (versus 3 million at December 31, 2009 and 5 million at December 31, 2008).



The payment schedule is as follows:



|                           |  |                        |    |  |             |  |   |                  |  |  |                  |  |  |              |   |  |  |  |   | 
|-------------------------- |  | ---------------------- | -- |  | ----------- |  | - | ---------------- |  |  | ---------------- |  |  | ------------ | - |  |  |  | - | 
|December 31, 2010          |  | Payments due by period |   
|( million)                |  | Total                  |    |  | Under1 year |  |   | From 1 to3 years |  |  | From 3 to5 years |  |  | Over 5
years |  
|Finance lease obligations: |  |                        |    |  |             |  |   |                  |  |  |                  |  |  |              |   |  |  |  |   | 
| principal                |  |                        | 25 |  |             |  | 6 |                  |  |  | 11               |  |  |              | 6 |  |  |  | 2 | 
| interest                 |  |                        | 3  |  |             |  | 1 |                  |  |  | 2                |  |  |              |  |  |  |  |  | 
|Total                      |  |                        | 28 |  |             |  | 7 |                  |  |  | 13               |  |  |              | 6 |  |  |  | 2 | 



F-42



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



D.4. Goodwill and other intangible assets



Other intangible assets break down as follows:



|                                                         |  |                    |        |   |                  |  |       |                                  |  |  |                                    |   |  |          |        |   |                            |  |      |   |  |  |         |  
|-------------------------------------------------------- |  | ------------------ | ------ | - | ---------------- |  | ----- | -------------------------------- |  |  | ---------------------------------- | - |  | -------- | ------ | - | -------------------------- |  | ---- | - |  |  | ------- | -
|( million)                                              |  | AcquiredAventisR&D |        |   | OtherAcquiredR&D |  |       | Rights tomarketedAventisproducts |  |  | Products,trademarksand otherrights |   |  | Software |        |   | Totalotherintangibleassets | 
|Gross value at January 1, 2008                           |  |                    | 2,644  |   |                  |  | 336   |                                  |  |  | 29,011                             |   |  |          | 1,554  |   |                            |  | 587  |   |  |  | 34,132  |  
|Changes in scope of consolidation                        |  |                    |       |   |                  |  | 198   |                                  |  |  |                                   |   |  |          | 139    |   |                            |  | 2    |   |  |  | 339     |  
|Acquisitions and other increases                         |  |                    |       |   |                  |  | 85    |                                  |  |  |                                   |   |  |          | 18     |   |                            |  | 47   |   |  |  | 150     |  
|Disposals and other decreases                            |  |                    |       |   |                  |  | (74   | )                                |  |  |                                   |   |  |          | (2     | ) |                            |  | (53  | ) |  |  | (129    | )
|Translation differences                                  |  |                    | 109    |   |                  |  | 15    |                                  |  |  | 1,008                              |   |  |          | 66     |   |                            |  | 1    |   |  |  | 1,199   |  
|Transfers                                                |  |                    | (300   | ) |                  |  | (2    | )                                |  |  | 300                                |   |  |          | (15    | ) |                            |  | 1    |   |  |  | (16     | )
|Gross value at December 31, 2008                         |  |                    | 2,453  |   |                  |  | 558   |                                  |  |  | 30,319                             |   |  |          | 1,760  |   |                            |  | 585  |   |  |  | 35,675  |  
|Changes in scope of consolidation                        |  |                    |       |   |                  |  | 789   |                                  |  |  |                                   |   |  |          | 1,405  |   |                            |  | 12   |   |  |  | 2,206   |  
|Acquisitions and other increases                         |  |                    |       |   |                  |  | 275   |                                  |  |  |                                   |   |  |          | 62     |   |                            |  | 56   |   |  |  | 393     |  
|Disposals and other decreases                            |  |                    |       |   |                  |  | (70   | )                                |  |  |                                   |   |  |          | (1     | ) |                            |  | (2   | ) |  |  | (73     | )
|Translation differences                                  |  |                    | (45    | ) |                  |  | (51   | )                                |  |  | (451                               | ) |  |          | 47     |   |                            |  | 2    |   |  |  | (498    | )
|Transfers                                                |  |                    | (87    | ) |                  |  | (9    | )                                |  |  | 87                                 |   |  |          | 11     |   |                            |  | 2    |   |  |  | 4       |  
|Gross value at December 31, 2009                         |  |                    | 2,321  |   |                  |  | 1,492 |                                  |  |  | 29,955                             |   |  |          | 3,284  |   |                            |  | 655  |   |  |  | 37,707  |  
|Changes in scope of consolidation                        |  |                    |       |   |                  |  | 192   |                                  |  |  |                                   |   |  |          | 1,365  |   |                            |  |     |   |  |  | 1,557   |  
|Acquisitions and other increases                         |  |                    |       |   |                  |  | 167   |                                  |  |  |                                   |   |  |          | 154    |   |                            |  | 67   |   |  |  | 388     |  
|Disposals and other decreases                            |  |                    |       |   |                  |  | (7    | )                                |  |  |                                   |   |  |          | (3     | ) |                            |  | (9   | ) |  |  | (19     | )
|Translation differences                                  |  |                    | 121    |   |                  |  | 61    |                                  |  |  | 1,669                              |   |  |          | 304    |   |                            |  | 28   |   |  |  | 2,183   |  
|Transfers                                                |  |                    | (173   | ) |                  |  | (341  | )                                |  |  | 173                                |   |  |          | 389    |   |                            |  | (1   | ) |  |  | 47      |  
|Gross value at December 31, 2010                         |  |                    | 2,269  |   |                  |  | 1,564 |                                  |  |  | 31,797                             |   |  |          | 5,493  |   |                            |  | 740  |   |  |  | 41,863  |  
|Accumulated amortization & impairment at January 1, 2008 |  |                    | (267   | ) |                  |  | (19   | )                                |  |  | (13,365                            | ) |  |          | (811   | ) |                            |  | (488 | ) |  |  | (14,950 | )
|Amortization expense                                     |  |                    |       |   |                  |  | (29   | )                                |  |  | (3,277                             | ) |  |          | (176   | ) |                            |  | (52  | ) |  |  | (3,534  | )
|Impairment losses, net of reversals                      |  |                    | (1,233 | ) |                  |  | (69   | )                                |  |  | (253                               | ) |  |          | 1      |   |                            |  |     |   |  |  | (1,554  | )
|Disposals                                                |  |                    |       |   |                  |  | 71    |                                  |  |  |                                   |   |  |          | 2      |   |                            |  | 53   |   |  |  | 126     |  
|Translation differences                                  |  |                    | (2     | ) |                  |  | (1    | )                                |  |  | (486                               | ) |  |          | (37    | ) |                            |  | 1    |   |  |  | (525    | )
|Transfers                                                |  |                    | 18     |   |                  |  |      |                                  |  |  | (18                                | ) |  |          | 24     |   |                            |  | (2   | ) |  |  | 22      |  
|Accumulated amortization & impairment at Dec. 31, 2008   |  |                    | (1,484 | ) |                  |  | (47   | )                                |  |  | (17,399                            | ) |  |          | (997   | ) |                            |  | (488 | ) |  |  | (20,415 | )
|Amortization expense                                     |  |                    |       |   |                  |  | (70   | )                                |  |  | (3,155                             | ) |  |          | (303   | ) |                            |  | (50  | ) |  |  | (3,578  | )
|Impairment losses, net of reversals                      |  |                    |       |   |                  |  | (28   | )                                |  |  | (344                               | ) |  |          |       |   |                            |  |     |   |  |  | (372    | )
|Disposals                                                |  |                    |       |   |                  |  | 69    |                                  |  |  |                                   |   |  |          | 2      |   |                            |  |     |   |  |  | 71      |  
|Translation differences                                  |  |                    | 28     |   |                  |  | 2     |                                  |  |  | 288                                |   |  |          | 19     |   |                            |  | (1   | ) |  |  | 336     |  
|Transfers                                                |  |                    |       |   |                  |  | 2     |                                  |  |  |                                   |   |  |          | (4     | ) |                            |  |     |   |  |  | (2      | )
|Accumulated amortization & impairment at Dec. 31, 2009   |  |                    | (1,456 | ) |                  |  | (72   | )                                |  |  | (20,610                            | ) |  |          | (1,283 | ) |                            |  | (539 | ) |  |  | (23,960 | )
|Amortization expense                                     |  |                    |       |   |                  |  |      |                                  |  |  | (3,050                             | ) |  |          | (479   | ) |                            |  | (49  | ) |  |  | (3,578  | )
|Impairment losses, net of reversals                      |  |                    | (10    | ) |                  |  | (132  | )                                |  |  | (117                               | ) |  |          | (174   | ) |                            |  |     |   |  |  | (433    | )
|Disposals                                                |  |                    |       |   |                  |  | 5     |                                  |  |  |                                   |   |  |          | 3      |   |                            |  | 9    |   |  |  | 17      |  
|Translation differences                                  |  |                    | (75    | ) |                  |  | (3    | )                                |  |  | (1,178                             | ) |  |          | (106   | ) |                            |  | (24  | ) |  |  | (1,386  | )
|Transfers                                                |  |                    | 1      |   |                  |  | 62    |                                  |  |  |                                   |   |  |          | (108   | ) |                            |  | 1    |   |  |  | (44     | )
|Accumulated amortization & impairment at Dec. 31, 2010   |  |                    | (1,540 | ) |                  |  | (140  | )                                |  |  | (24,955                            | ) |  |          | (2,147 | ) |                            |  | (602 | ) |  |  | (29,384 | )
|Carrying amount: January 1, 2008                         |  |                    | 2,377  |   |                  |  | 317   |                                  |  |  | 15,646                             |   |  |          | 743    |   |                            |  | 99   |   |  |  | 19,182  |  
|Carrying amount: December 31, 2008                       |  |                    | 969    |   |                  |  | 511   |                                  |  |  | 12,920                             |   |  |          | 763    |   |                            |  | 97   |   |  |  | 15,260  |  
|Carrying amount: December 31, 2009                       |  |                    | 865    |   |                  |  | 1,420 |                                  |  |  | 9,345                              |   |  |          | 2,001  |   |                            |  | 116  |   |  |  | 13,747  |  
|Carrying amount: December 31, 2010                       |  |                    | 729    |   |                  |  | 1,424 |                                  |  |  | 6,842                              |   |  |          | 3,346  |   |                            |  | 138  |   |  |  | 12,479  |  



F-43



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Movements in goodwill for the last three financial periods are shown below:



|                             |  |             |        |   |            |  |     |                 |  |  |        |  
|---------------------------- |  | ----------- | ------ | - | ---------- |  | --- | --------------- |  |  | ------ | -
|( million)                  |  | Gross value |        |   | Impairment |  |     | Carrying amount | 
|Balance at January 1, 2008   |  |             | 27,226 |   |            |  | (27 | )               |  |  | 27,199 |  
|Movements for the period(1)  |  |             | 397    |   |            |  |    |                 |  |  | 397    |  
|Translation differences      |  |             | 565    |   |            |  | 2   |                 |  |  | 567    |  
|Balance at December 31, 2008 |  |             | 28,188 |   |            |  | (25 | )               |  |  | 28,163 |  
|Movements for the period(1)  |  |             | 1,798  |   |            |  |    |                 |  |  | 1,798  |  
|Translation differences      |  |             | (228   | ) |            |  |    |                 |  |  | (228   | )
|Balance at December 31, 2009 |  |             | 29,758 |   |            |  | (25 | )               |  |  | 29,733 |  
|Movements for the period(1)  |  |             | 1,017  |   |            |  |    |                 |  |  | 1,017  |  
|Translation differences      |  |             | 1,183  |   |            |  | (1  | )               |  |  | 1,182  |  
|Balance at December 31, 2010 |  |             | 31,958 |   |            |  | (26 | )               |  |  | 31,932 |  



|(1) | Mainly relating to changes in the scope of consolidation.
|--- | ---------------------------------------------------------



| |  | Aventis Acquisition
|- |  | -------------------



On August 20, 2004, sanofi-aventis acquired Aventis, a global pharmaceutical group created in 1999 by the merger between
Rhône-Poulenc and Hoechst.



As part of the
process of creating the new Group, the two former parent companies  Sanofi-Synthélabo (renamed sanofi-aventis) and Aventis  were merged on December 31, 2004.



The total purchase price as measured under IFRS 3 (Business Combinations) was 52,908 million,
of which 15,894 million was settled in cash.



Goodwill arising from the acquisition of Aventis amounted to 28,228 million at December 31, 2010, compared with 27,221 million at December 31, 2009 and
27,632 million at December 31, 2008.



Rights to marketed products and goodwill arising on the Aventis acquisition were allocated on the basis of the split of the Groups operations into business and geographical segments, and valued in
the currency of the relevant geographical segment (mainly euros and U.S. dollars) with assistance from an independent valuer. The average period of amortization for marketed products was initially set at 8 years, based on cash flow forecasts which,
among other factors, take account of the period of legal protection offered by the related patents.



Rights to marketed Aventis products represent a diversified portfolio of rights relating to many different products.
As of December 31, 2010, 80.6% of the carrying amount of these rights related to the Pharmaceuticals segment, and 19.4% to the Vaccines segment. The five principal pharmaceutical products in this portfolio by carrying amount (Lantus®/Apidra®: 1,859 million;
Lovenox®: 541 million; Allegra®: 350 million; Actonel®:
323 million; Arava®: 316 million) accounted for approximately 61.5% of the total carrying
amount of product rights for the Pharmaceuticals business as of December 31, 2010.



During 2008, some of the acquired Aventis research and development (300 million) came into commercial use; it is
being amortized from the date of marketing approval. The main products involved are Pentacel® vaccine in the
United States and the once-a-month dose of Actonel® in the United States.



During 2009, some of the acquired Aventis
research and development (87 million) came into commercial use; it is being amortized from the date of marketing approval. The main product involved is Sculptra® in the United States.



During 2010, some of the acquired Aventis research and development (173 million) came into commercial use; it is
being amortized from the date of marketing approval. The main product involved is the oncology drug Jevtana®
(cabazitaxel) in the United States.



F-44



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



| |  | Other acquisitions
|- |  | ------------------



Increases in intangible assets and goodwill during the year ended December 31, 2010 were mainly due to business combinations
completed during the year. Details of the purchase price allocations for the principal acquisitions made during 2010 are provided in Note D.1. Significant acquisitions.



Acquisitions of intangible assets during 2010 (other than
software and assets recognized in business combinations) totaled 321 million, most of which related to license agreements (see Note D.21. for a description of the principal agreements).



The effects of the final purchase price allocations of the
principal acquisitions of 2009 (see Note D.1.) were as follows:



| |  |  | Medley: recognition of intangible assets of 181 million, and goodwill of 376 million.
| | - |  | ---------------------------------------------------------------------------------------



| |  |  | Zentiva: recognition of intangible assets of 976 million (mainly comprising the value of marketed products and of the Zentiva trademark),
and of goodwill of 886 million (including the effect of buyouts of non-controlling interests during the period).
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | BiPar: valuation of the principal product under development, BSI-201, at 539 million as of the acquisition date.
| | - |  | -----------------------------------------------------------------------------------------------------------------



| |  |  | Shantha: recognition of intangible assets of 374 million.
| | - |  | ----------------------------------------------------------



The effects of the final purchase price allocations of the
principal acquisitions of 2008 (see Note D.1.) were as follows:



| |  |  | Symbion Consumer: recognition of intangible assets of 116 million, and goodwill of 206 million.
| | - |  | -------------------------------------------------------------------------------------------------



| |  |  | Acambis: recognition of intangible assets of 223 million (including 198 million for research projects), and goodwill of 197
million.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------



During the year ended December 31, 2010, acquired non-Aventis research brought into commercial use mainly
comprised Zentiva generics in Eastern Europe, the Japanese encephalitis vaccine, and the Libertas® formulation
of Actonel® in the United States.



Acquisitions of intangible assets during 2009 (other than
software and assets recognized in business combinations) totaled 337 million and related mainly to license agreements, including the collaboration agreements with Exelixis and Merrimack.



Acquisitions of intangible assets during 2008 (other than
software and assets recognized in business combinations) totaled 103 million and related mainly to license agreements, including the collaboration agreements with Novozymes and Dyax Corp.



Amortization of intangible assets is recognized in the income
statement under Amortization of intangible assets except for amortization of software, which is recognized on the relevant line of the income statement according to the purpose for which the software is used:



|                                  |  |                            |    |  |                            |  |    |                            |  |  |    | 
|--------------------------------- |  | -------------------------- | -- |  | -------------------------- |  | -- | -------------------------- |  |  | -- | 
|( million)                       |  | Year endedDecember 31,2010 |    |  | Year endedDecember 31,2009 |  |    | Year endedDecember 31,2008 | 
|Cost of sales                     |  |                            | 11 |  |                            |  | 11 |                            |  |  | 10 | 
|Research and development expenses |  |                            | 11 |  |                            |  | 14 |                            |  |  | 14 | 
|Selling and general expenses      |  |                            | 26 |  |                            |  | 24 |                            |  |  | 28 | 
|Other operating expenses          |  |                            | 1  |  |                            |  | 1  |                            |  |  |   | 
|Total                             |  |                            | 49 |  |                            |  | 50 |                            |  |  | 52 | 



F-45



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



D.5. Impairment of intangible assets and property, plant and equipment



| |  | Goodwill
|- |  | --------



The recoverable amount of cash generating units (CGUs) is determined by reference to the value in use of each CGU, based on discounted
estimates of the future cash flows from the CGU in accordance with the policies described in Note B.6.1.



The allocation of goodwill to CGUs is shown below:



|            |  |                        |        |  |                               |  |        |                                 |  |  |              |  |  |                          |     |  |            |  |     |  |  |  |        | 
|----------- |  | ---------------------- | ------ |  | ----------------------------- |  | ------ | ------------------------------- |  |  | ------------ |  |  | ------------------------ | --- |  | ---------- |  | --- |  |  |  | ------ | 
|( million) |  | December 31, 2010      |       
|            |  | Pharmaceuticals:Europe |        |  | Pharmaceuticals:North America |  |        | Pharmaceuticals:Other Countries |  |  | Vaccines:USA |  |  | Vaccines:Other Countries |     |  | GroupTotal | 
|Goodwill    |  |                        | 13,718 |  |                               |  | 12,525 |                                 |  |  | 4,612        |  |  |                          | 739 |  |            |  | 338 |  |  |  | 31,932 | 



Value in use is determined by applying a post-tax discount rate of 9% to estimated future post-tax cash flows for all CGUs. The pre-tax
discount rate (calculated by iteration from the previously-determined value in use) applied to estimated future pre-tax cash flows is approximately 13% for the entire Group.



The assumptions used in testing goodwill for impairment are
reviewed annually. Apart from the discount rate, the principal assumptions used in 2010 were as follows:



| |  |  | The perpetual growth rates applied to future cash flows were in a range from 0% (in particular, for Europe and North America) to 2% for Pharmaceuticals
CGUs, and from 1% to 3% for Vaccines CGUs.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Sanofi-aventis also applies assumptions on the probability of success of its current research and development projects, and more generally on its
ability to renew its product portfolio in the longer term.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Value in use (determined as described above) is compared with carrying amount, and this comparison is then subject to sensitivity analysis with reference to the two principal parameters (discount rate and
perpetual growth rate).



No impairment would need
to be recognized unless the discount rate used to calculate value in use was to exceed the 9% rate actually used by more than 2.5 percentage points. Similarly, a zero perpetual growth rate would not result in any impairment of the goodwill of these
CGUs.



No impairment losses were recognized
against goodwill in the years ended December 31, 2010, 2009 or 2008.



| |  | Other intangible assets
|- |  | -----------------------



When there is evidence that an asset may have become impaired, its value in use is calculated by applying a post-tax discount rate to the
estimated future post-tax cash flows from that asset. For the purposes of impairment testing, the tax cash flows relating to the asset are determined using a notional tax rate incorporating the notional tax benefit that would result from amortizing
the asset if its value in use were regarded as its depreciable amount for tax purposes. Applying post-tax discount rates to post-tax cash flows gives the same values in use as would be obtained by applying pre-tax discount rates to pre-tax cash
flows.



The post-tax discount rates used during
2010 for impairment testing of other intangible assets in the Pharmaceuticals and Vaccines segments were obtained by adjusting the Groups Weighted Average Cost of Capital of 8% to reflect specific country and business risks, giving post-tax
rates in a range from 9% to 13%.



In most cases,
there are no market data that would enable fair value less costs to sell to be determined other than by means of a similar estimate based on future cash flows. Consequently, the recoverable amount is in substance equal to the value in use.



F-46



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



In 2010, impairment losses of 433 million were recognized
based on the results of impairment testing of other intangible assets. These losses arose mainly on marketed products (291 million), including Actonel® (due to proposed amendments to the terms of the collaboration agreement with Warner Chilcott, see Note C.2.) and
Shan5® (due to revised sales projections following requalification of the vaccine by the World Health
Organization). Impairment losses recognized in respect of research projects totaled 142 million, and arose mainly from revisions to the development plan for BSI-201 following announcement of the initial results from the Phase III trial in
triple-negative metastatic breast cancer and from decisions to halt development on some other projects.



In 2009, impairment losses of 372 million were recognized based on the results of impairment tests. These
losses related mainly to the marketed products Actonel®, Benzaclin® and Nasacort®, and took account of changes in the competitive environment and the approval dates of generics.



In 2008, impairment losses were recognized to take account
of:



| |  | the discontinuation of research projects, principally larotaxel and cabazitaxel (new taxane derivatives intended as treatments for breast cancer, 1,175 million)
and the antihypertensive ilepatril, both of which were recognized as assets on the acquisition of Aventis, plus the oral anti-cancer agent S-1 following the termination of the agreement with Taiho Pharmaceutical on development and marketing of this
product;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | settlements reached with Barr in the United States relating to the marketed product Nasacort®, and the impact of generics on certain products.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------



| |  | Property, plant and equipment
|- |  | -----------------------------



Impairment losses taken against property, plant and equipment are disclosed in Note D.3.



D.6. Investments in associates and joint ventures



For definitions of the terms associate and
joint venture, refer to Note B.1.



Investments in associates and joint ventures break down as follows:



|                                                          |  |            |      |  |              |  |     |              |  |  |              |     |  |  |       | 
|--------------------------------------------------------- |  | ---------- | ---- |  | ------------ |  | --- | ------------ |  |  | ------------ | --- |  |  | ----- | 
|( million)                                               |  | % interest |      |  | Dec. 31,2010 |  |     | Dec. 31,2009 |  |  | Dec. 31,2008 |    
|Sanofi Pasteur MSD                                        |  |            | 50.0 |  |              |  | 343 |              |  |  | 407          |     |  |  | 427   | 
|Merial (until September 17, 2009)                         |  |            | 50.0 |  |              |  |    |              |  |  |             | (2) |  |  | 1,203 | 
|InfraServ Höchst                                          |  |            | 31.2 |  |              |  | 92  |              |  |  | 95           |     |  |  | 96    | 
|Entities and companies managed by Bristol-Myers Squibb(1) |  |            | 49.9 |  |              |  | 265 |              |  |  | 234          |     |  |  | 196   | 
|Zentiva (until March 30, 2009)                            |  |            | 24.9 |  |              |  |    |              |  |  |             | (3) |  |  | 332   | 
|Financière des Laboratoires de Cosmétologie Yves Rocher   |  |            | 39.1 |  |              |  | 128 |              |  |  | 123          |     |  |  | 119   | 
|Other investments                                         |  |            |     |  |              |  | 96  |              |  |  | 96           |     |  |  | 86    | 
|Total                                                     |  |            |      |  |              |  | 924 |              |  |  | 955          |     |  |  | 2,459 | 



|(1) | Under the terms of the agreements with BMS (see Note C.1.), the Groups
share of the net assets of entities majority-owned by BMS is recorded inInvestments in associates and joint ventures.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Merial has been accounted for by the full consolidation method since
September 18, 2009; see Note D.8.
|--- | ------------------------------------------------------------------------------------------------------

|(3) | Zentiva has been accounted for by the full consolidation method since
March 31, 2009; see Note D.1.
|--- | ---------------------------------------------------------------------------------------------------



F-47



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The financial statements include commercial transactions between the Group and certain
of its associates and joint ventures. The principal transactions of this nature are summarized below:



|                       |  |      |       |  |      |  |       |      |  |  |       | 
|---------------------- |  | ---- | ----- |  | ---- |  | ----- | ---- |  |  | ----- | 
|( million)            |  | 2010 |       |  | 2009 |  |       | 2008 | 
|Sales                  |  |      | 541   |  |      |  | 517   |      |  |  | 432   | 
|Royalties(1)           |  |      | 1,324 |  |      |  | 1,179 |      |  |  | 1,014 | 
|Accounts receivable(1) |  |      | 441   |  |      |  | 419   |      |  |  | 370   | 
|Purchases              |  |      | 227   |  |      |  | 247   |      |  |  | 254   | 
|Accounts payable       |  |      | 22    |  |      |  | 32    |      |  |  | 30    | 
|Other liabilities(1)   |  |      | 350   |  |      |  | 297   |      |  |  | 242   | 



|(1) | These items mainly relate to entities and companies managed by BMS.
|--- | -------------------------------------------------------------------



Key financial
indicators for associates and joint ventures, excluding the effects of purchase price allocations, are as follows:



|                                                        |  |                                      |       |  |                                                           |  |       |      |  |  |       |  |  |      |     |  |      |  |       |  |  |  |       | 
|------------------------------------------------------- |  | ------------------------------------ | ----- |  | --------------------------------------------------------- |  | ----- | ---- |  |  | ----- |  |  | ---- | --- |  | ---- |  | ----- |  |  |  | ----- | 
|                                                        |  | Principal associates 
(1)100% impact |       |  | Principal joint ventures 
(2)Share held by sanofi-aventis | 
|( million)                                             |  | 2010                                 |       |  | 2009                                                      |  |       | 2008 |  |  | 2010  |  |  | 2009 |     |  | 2008 | 
|Non-current assets                                      |  |                                      | 512   |  |                                                           |  | 526   |      |  |  | 1,919 |  |  |      | 25  |  |      |  | 27    |  |  |  | 354   | 
|Current assets                                          |  |                                      | 1,336 |  |                                                           |  | 1,278 |      |  |  | 2,717 |  |  |      | 231 |  |      |  | 224   |  |  |  | 688   | 
|Non-current liabilities                                 |  |                                      | 468   |  |                                                           |  | 336   |      |  |  | 913   |  |  |      | 100 |  |      |  | 32    |  |  |  | 99    | 
|Current liabilities                                     |  |                                      | 690   |  |                                                           |  | 792   |      |  |  | 1,798 |  |  |      | 142 |  |      |  | 178   |  |  |  | 404   | 
|Equity attributable to equity holders of sanofi-aventis |  |                                      | 387   |  |                                                           |  | 391   |      |  |  | 1,622 |  |  |      | 14  |  |      |  | 41    |  |  |  | 536   | 
|Non-controlling interests                               |  |                                      | 303   |  |                                                           |  | 285   |      |  |  | 303   |  |  |      |    |  |      |  |      |  |  |  | 2     | 
|Net sales                                               |  |                                      | 8,114 |  |                                                           |  | 9,325 |      |  |  | 9,770 |  |  |      | 459 |  |      |  | 1,203 |  |  |  | 1,537 | 
|Cost of sales                                           |  |                                      | 2,130 |  |                                                           |  | 2,397 |      |  |  | 2,555 |  |  |      | 179 |  |      |  | 359   |  |  |  | 433   | 
|Operating income                                        |  |                                      | 3,163 |  |                                                           |  | 3,144 |      |  |  | 2,838 |  |  |      | 49  |  |      |  | 312   |  |  |  | 372   | 
|Net income                                              |  |                                      | 3,035 |  |                                                           |  | 2,880 |      |  |  | 2,384 |  |  |      | 8   |  |      |  | 222   |  |  |  | 225   | 



|(1) | The figures reported above are full-year figures, before allocation of
partnership profits. The following associates are included in this table for 2008: BMS/Sanofi Pharmaceuticals Holding Partnership, BMS/Sanofi Pharmaceuticals Partnership, BMS/Sanofi-Synthelabo Partnership, Yves Rocher, Merial, Sanofi Pasteur MSD,
and Zentiva. Figures for Merial are not included in this table with effect from September 18, 2009 (the date since when Merial has been accounted for by the full consolidation method), and figures for Zentiva are not included in this table with
effect from March 31, 2009 (the date since when Zentiva has been accounted for by the full consolidation method).
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | The principal joint ventures are:
|--- | ---------------------------------

|                                  |  |         |                   |  |          |  |               | 
|--------------------------------- |  | ------- | ----------------- |  | -------- |  | ------------- | 
|                                  |  | Partner |                   |  | Business | 
|Merial (until September 17, 2009) |  |         | Merck & Co., Inc. |  |          |  | Animal Health | 
|Sanofi Pasteur MSD                |  |         | Merck & Co., Inc. |  |          |  | Vaccines      | 



D.7. Non-current financial assets



The main items included in Non-current financial assets are:



|                                                  |  |                  |       |  |                  |  |     |                  |  |  |     | 
|------------------------------------------------- |  | ---------------- | ----- |  | ---------------- |  | --- | ---------------- |  |  | --- | 
|( million)                                       |  | December 31,2010 |       |  | December 31,2009 |  |     | December 31,2008 | 
|Available-for-sale financial assets               |  |                  | 816   |  |                  |  | 588 |                  |  |  | 491 | 
|Pre-funded pension obligations (see Note D.19.1.) |  |                  | 4     |  |                  |  | 3   |                  |  |  | 1   | 
|Long-term loans and advances                      |  |                  | 483   |  |                  |  | 256 |                  |  |  | 186 | 
|Assets recognized under the fair value option     |  |                  | 121   |  |                  |  | 100 |                  |  |  | 72  | 
|Derivative financial instruments (see Note D.20.) |  |                  | 220   |  |                  |  | 51  |                  |  |  | 71  | 
|Total                                             |  |                  | 1,644 |  |                  |  | 998 |                  |  |  | 821 | 



F-48



---

##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Equity investments classified as available-for-sale financial assets include:



| |  |  | A total of 1.5 million shares representing a 4.66% equity interest in Nichi-Iko, acquired in June 2010 and valued on the basis of the quoted
market price as of December 31, 2010 at 40 million.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | An 18.32% equity interest in the biopharmaceuticals company Regeneron, with which sanofi-aventis has research and development collaboration agreements
(see Note D.21.). This investment had a carrying amount of 389 million at December 31, 2010 (248 million at December 31, 2009, and 195 million at December 31, 2008).
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Equity interests in research and development companies such as Proteome Science (2 million at December 31, 2010, 2 million at
December 31, 2009, and 3 million at December 31, 2008) and Genfit (3 million at December 31, 2010, 5 million at December 31, 2009, 4 million at December 31, 2008).
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Financial assets held to match commitments (288 million at December 31, 2010, 269 million at December 31, 2009, and
223 million at December 31, 2008).
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------



During 2010, the Group divested its 13% equity interest in ProStrakan for 28 million; this investment had a carrying amount of 25 million as of December 31, 2009.



During 2008, the Group divested its equity interest in
Millennium (carrying amount 46 million), generating a pre-tax gain of 38 million (see Note D.29.).



The cumulative unrealized net after-tax gain recognized directly in equity on available-for-sale financial assets at December 31,
2010 was 164 million, relating mainly to the investment in Regeneron (111 million). This compares with a cumulative unrealized net after-tax gain of 38 million at December 31, 2009, and a cumulative unrealized net
after-tax loss of 49 million at December 31, 2008, mainly on the investment in Regeneron.



The impact of a 10% fall in stock prices on quoted shares included in available-for-sale assets at December 31, 2010 would have been
as follows:



|                                                           |  |             |     |  
|---------------------------------------------------------- |  | ----------- | --- | -
|( million)                                                |  | Sensitivity |    
|Income/(expense) recognized directly in equity, before tax |  |             | (58 | )
|Income before tax                                          |  |             |    |  
|Total                                                      |  |             | (58 | )



A 10% fall in stock prices of other available-for-sale financial assets combined with a simultaneous 0.5% rise in the yield curve would
have had the following impact at December 31, 2010:



|                                                           |  |             |     |  
|---------------------------------------------------------- |  | ----------- | --- | -
|( million)                                                |  | Sensitivity |    
|Income/(expense) recognized directly in equity, before tax |  |             | (17 | )
|Income before tax                                          |  |             |    |  
|Total (1)                                                  |  |             | (17 | )



|(1) | This impact would represent approximately 6% of the value of the underlying
assets.
|--- | -----------------------------------------------------------------------------------



Available-for-sale financial assets also include equity investments not quoted in an active market. These investments had a carrying
amount of 47 million at December 31, 2010, compared with 31 million at December 31, 2009 and 34 million at December 31, 2008.



Long-term loans and advances are measured at amortized cost,
which at the balance sheet date was not materially different from their fair value. The increase in long-term loans and advances between December 31, 2009 and December 31, 2010 was mainly due to surety paid in connection with ongoing
litigation.



Assets recognized under the fair
value option represent a portfolio of financial investments held to fund a deferred compensation plan offered to certain employees.



F-49



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



D.8. Assets held for sale or exchange



A breakdown as of December 31, 2010 of assets held for sale or exchange, and of liabilities related to
assets held for sale or exchange, is shown below:



|                                                              |  |  |        |  |                  |  |       |                      |  |  |       | 
|------------------------------------------------------------- |  |  | ------ |  | ---------------- |  | ----- | -------------------- |  |  | ----- | 
|( million)                                                   |  |  |        |  | December 31,2010 |  |       | December 
31,2009(1) | 
|Merial                                                        |  |  | D.8.1. |  |                  |  | 7,019 |                      |  |  | 6,540 | 
|Other                                                         |  |  | D.8.2. |  |                  |  | 17    |                      |  |  | 4     | 
|Total assets held for sale or exchange                        |  |  |        |  |                  |  | 7,036 |                      |  |  | 6,544 | 
|Merial                                                        |  |  | D.8.1. |  |                  |  | 1,672 |                      |  |  | 1,501 | 
|Total liabilities related to assets held for sale or exchange |  |  |        |  |                  |  | 1,672 |                      |  |  | 1,501 | 



|(1) | In
accordance with IFRS 3 (Business Combinations), sanofi-aventis adjusted the values of certain identifiable assets and liabilities of Merial during the purchase price allocation period.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



D.8.1. Merial



In March 2010, sanofi-aventis exercised its contractual
right to combine Merial with the Intervet/Schering-Plough business to form a new joint venture equally owned by Merck and sanofi-aventis. Formation of the new joint venture is subject to signature of final agreements, antitrust review in the United
States, Europe and other countries, and other customary closing conditions. Closing of the transaction is expected in 2011.



In accordance with the accounting policy described in Note B.7., with effect from December 31, 2009 the entire assets of Merial have
been reported on the line Assets held for sale or exchange, and the entire liabilities of Merial have been reported on the line Liabilities related to assets held for sale or exchange. The net income of Merial is reported
on the line Net income from the held-for-exchange Merial business.



The table below shows the assets and liabilities of Merial classified in Assets held for sale or exchange and Liabilities related to assets held for sale or exchange at
December 31, 2010 and December 31, 2009, after elimination of intercompany balances between Merial and other Group companies.



|                                                              |  |                  |       |  |                      |  |       | 
|------------------------------------------------------------- |  | ---------------- | ----- |  | -------------------- |  | ----- | 
|( million)                                                   |  | December 31,2010 |       |  | December 
31,2009(1) | 
|Assets                                                        |  |                  |       |  |                      |  |       | 
| Property, plant and equipment and financial assets          |  |                  | 811   |  |                      |  | 684   | 
| Goodwill                                                    |  |                  | 1,209 |  |                      |  | 1,124 | 
| Intangible assets                                           |  |                  | 3,961 |  |                      |  | 3,683 | 
| Deferred tax assets                                         |  |                  | 92    |  |                      |  | 60    | 
| Inventories                                                 |  |                  | 344   |  |                      |  | 425   | 
| Accounts receivable                                         |  |                  | 405   |  |                      |  | 373   | 
| Other current assets                                        |  |                  | 50    |  |                      |  | 64    | 
| Cash and cash equivalents                                   |  |                  | 147   |  |                      |  | 127   | 
|Total assets held for sale or exchange                        |  |                  | 7,019 |  |                      |  | 6,540 | 
|Liabilities                                                   |  |                  |       |  |                      |  |       | 
| Long-term debt                                              |  |                  | 4     |  |                      |  | 6     | 
| Non-current provisions                                      |  |                  | 70    |  |                      |  | 85    | 
| Deferred tax liabilities                                    |  |                  | 1,132 |  |                      |  | 1,034 | 
| Short-term debt                                             |  |                  | 24    |  |                      |  | 22    | 
| Accounts payable                                            |  |                  | 161   |  |                      |  | 124   | 
| Other current liabilities                                   |  |                  | 281   |  |                      |  | 230   | 
|Total liabilities related to assets held for sale or exchange |  |                  | 1,672 |  |                      |  | 1,501 | 



|(1) | In
accordance with IFRS 3 (Business Combinations), sanofi-aventis adjusted the values of certain identifiable assets and liabilities of Merial during the purchase price allocation period.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-50



---

##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Changes in the balances relating to Merial between December 31, 2009 and
December 31, 2010 are mainly due to translation effects arising from movements in the U.S. dollar exchange rate between those dates, and to adjustments to the purchase price allocation.



The components of Net income from the held-for-exchange Merial business are shown below:



|                                                        |  |                            |       |   |                            |  |     |                            |  |  |     | 
|------------------------------------------------------- |  | -------------------------- | ----- | - | -------------------------- |  | --- | -------------------------- |  |  | --- | 
|( million)                                             |  | Year endedDecember 31,2010 |       |   | Year endedDecember 31,2009 |  |     | Year endedDecember 31,2008 | 
|Net sales                                               |  |                            | 1,983 |   |                            |  | 479 | (2)                        |  |  |    | 
|Operating income                                        |  |                            | 575   |   |                            |  | 69  | (2)                        |  |  |    | 
|Net financial income/(expense)                          |  |                            |      |   |                            |  | 2   | (2)                        |  |  |    | 
|Income tax expense                                      |  |                            | (189  | ) |                            |  | (35 | )(2)                       |  |  |    | 
|Share of profit/(loss) of associates and joint ventures |  |                            |      |   |                            |  | 139 | (1)                        |  |  | 120 | 
|Net income from the held-for-exchange Merial business   |  |                            | 386   |   |                            |  | 175 |                            |  |  | 120 | 



|(1) | Until September 17, 2009.
|--- | -------------------------

|(2) | From September 18, 2009.
|--- | ------------------------



The table below sets forth, as required by IFRS 5,
disclosures of how net income attributable to equity holders of sanofi-aventis, net income attributable to non-controlling interests, basic earnings per share and diluted earnings per share are split between activities other than Merial and the
held-for-exchange Merial business:



|                                                             |  |                            |       |  |                            |  |       |                            |  |  |       | 
|------------------------------------------------------------ |  | -------------------------- | ----- |  | -------------------------- |  | ----- | -------------------------- |  |  | ----- | 
|( million)                                                  |  | Year endedDecember 31,2010 |       |  | Year endedDecember 31,2009 |  |       | Year endedDecember 31,2008 | 
|Net income excluding the held-for-exchange Merial business   |  |                            | 5,335 |  |                            |  | 5,516 |                            |  |  | 4,172 | 
|Net income from the held-for-exchange Merial business        |  |                            | 386   |  |                            |  | 175   |                            |  |  | 120   | 
|Net income                                                   |  |                            | 5,721 |  |                            |  | 5,691 |                            |  |  | 4,292 | 
|Net income attributable to non-controlling interests:        |  |                            |       |  |                            |  |       |                            |  |  |       | 
|Net income excluding the held-for-exchange Merial business   |  |                            | 254   |  |                            |  | 426   |                            |  |  | 441   | 
|Net income from the held-for-exchange Merial business        |  |                            |      |  |                            |  |      |                            |  |  |      | 
|Net income attributable to non-controlling interests         |  |                            | 254   |  |                            |  | 426   |                            |  |  | 441   | 
|Net income attributable to equity holders of sanofi-aventis: |  |                            |       |  |                            |  |       |                            |  |  |       | 
|Net income excluding the held-for-exchange Merial business   |  |                            | 5,081 |  |                            |  | 5,090 |                            |  |  | 3,731 | 
|Net income from the held-for-exchange Merial business        |  |                            | 386   |  |                            |  | 175   |                            |  |  | 120   | 
|Net income attributable to equity holders of sanofi-aventis  |  |                            | 5,467 |  |                            |  | 5,265 |                            |  |  | 3,851 | 
|Basic earnings per share:                                    |  |                            |       |  |                            |  |       |                            |  |  |       | 
|Excluding the held-for-exchange Merial business (in euros)   |  |                            | 3.89  |  |                            |  | 3.90  |                            |  |  | 2.85  | 
|Held-for-exchange Merial business (in euros)                 |  |                            | 0.30  |  |                            |  | 0.13  |                            |  |  | 0.09  | 
|Basic earnings per share (in euros)                          |  |                            | 4.19  |  |                            |  | 4.03  |                            |  |  | 2.94  | 
|Diluted earnings per share:                                  |  |                            |       |  |                            |  |       |                            |  |  |       | 
|Excluding the held-for-exchange Merial business (in euros)   |  |                            | 3.88  |  |                            |  | 3.90  |                            |  |  | 2.85  | 
|Held-for-exchange Merial business (in euros)                 |  |                            | 0.30  |  |                            |  | 0.13  |                            |  |  | 0.09  | 
|Diluted earnings per share (in euros)                        |  |                            | 4.18  |  |                            |  | 4.03  |                            |  |  | 2.94  | 



F-51



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The table below sets forth the net sales of Merials principal products, expressed
in millions of U.S. dollars:



|                                              |  |                            |       |  |                            |  |       |                            |  |  |       | 
|--------------------------------------------- |  | -------------------------- | ----- |  | -------------------------- |  | ----- | -------------------------- |  |  | ----- | 
|($ million)                                   |  | Year endedDecember 31,2010 |       |  | Year endedDecember 31,2009 |  |       | Year endedDecember 31,2008 | 
|Frontline ® and other fipronil-based
products |  |                            | 1,027 |  |                            |  | 996   |                            |  |  | 1,053 | 
|Vaccines                                      |  |                            | 837   |  |                            |  | 794   |                            |  |  | 790   | 
|Avermectin                                    |  |                            | 473   |  |                            |  | 475   |                            |  |  | 512   | 
|Other                                         |  |                            | 298   |  |                            |  | 289   |                            |  |  | 288   | 
|Total                                         |  |                            | 2,635 |  |                            |  | 2,554 |                            |  |  | 2,643 | 



The contractual obligations and other commitments of Merial as of December 31, 2010 are as follows:



|                                                    |       |  |     |             |                        |  |                  |   |  |                  |   |  |             |  |    |   |  |  |    |  
|--------------------------------------------------- | ----- |  | --- | ----------- | ---------------------- |  | ---------------- | - |  | ---------------- | - |  | ----------- |  | -- | - |  |  | -- | -
|( million)                                         |       |  |     |             | Payments due by period | 
|                                                    | Total |  |     | Under1 year |                        |  | From 1 to3 years |   |  | From 3 to5 years |   |  | Over5 years | 
|Obligations and other contractual commitments:      |       |  |     |             |                        |  |                  |   |  |                  |   |  |             |  |    |   |  |  |    |  
| outflows                                          |       |  | 129 |             |                        |  | 104              |   |  |                  | 9 |  |             |  | 12 |   |  |  | 4  |  
| inflows                                           |       |  | (34 | )           |                        |  | (30              | ) |  |                  |  |  |             |  | (3 | ) |  |  | (1 | )
|Total obligations and other contractual commitments |       |  | 95  |             |                        |  | 74               |   |  |                  | 9 |  |             |  | 9  |   |  |  | 3  |  



D.8.2. Other assets held for sale



As of December 31, 2010, other assets held for sale relate to R&D facilities in France.



As of December 31, 2009, other assets held for sale
related to the ongoing divestment of the R&D facilities at Alnwick and Porcheville and of an industrial site. An impairment loss of 107 million was charged against these assets (and recognized under Restructuring costs
in the income statement) prior to their reclassification as held for sale.



As of December 31, 2008, sanofi-aventis had assets held for sale relating to the ongoing divestment of a plant at Colomiers in the Haute-Garonne region of France. These assets were fully written down
as of that date.



D.9. Inventories



Inventories break down as follows:



|                |       |                   |       |            |                   |  |      |                   |  |       |       |  |            |  |       |     |  |  |       |   |  |            |       |  |     |  |       |  |  |  |      |   |  |  |       | 
|--------------- | ----- | ----------------- | ----- | ---------- | ----------------- |  | ---- | ----------------- |  | ----- | ----- |  | ---------- |  | ----- | --- |  |  | ----- | - |  | ---------- | ----- |  | --- |  | ----- |  |  |  | ---- | - |  |  | ----- | 
|( million)     |       | December 31, 2010 |       |            | December 31, 2009 |  |      | December 31, 2008 | 
|                | Gross |                   |       | Impairment |                   |  | Net  |                   |  | Gross |       |  | Impairment |  |       | Net |  |  | Gross |   |  | Impairment |       |  | Net | 
|Raw materials   |       |                   | 838   |            |                   |  | (88  | )                 |  |       | 750   |  |            |  | 752   |     |  |  | (96   | ) |  |            | 656   |  |     |  | 615   |  |  |  | (91  | ) |  |  | 524   | 
|Work in process |       |                   | 2,940 |            |                   |  | (255 | )                 |  |       | 2,685 |  |            |  | 2,456 |     |  |  | (241  | ) |  |            | 2,215 |  |     |  | 2,028 |  |  |  | (226 | ) |  |  | 1,802 | 
|Finished goods  |       |                   | 1,714 |            |                   |  | (129 | )                 |  |       | 1,585 |  |            |  | 1,709 |     |  |  | (136  | ) |  |            | 1,573 |  |     |  | 1,449 |  |  |  | (185 | ) |  |  | 1,264 | 
|Total           |       |                   | 5,492 |            |                   |  | (472 | )                 |  |       | 5,020 |  |            |  | 4,917 |     |  |  | (473  | ) |  |            | 4,444 |  |     |  | 4,092 |  |  |  | (502 | ) |  |  | 3,590 | 



The impact of changes in provisions for impairment of inventories in 2010 is a net expense of 22 million,
compared with 26 million in 2009 and 30 million in 2008. Impairment losses against inventories as of December 31, 2010 relate primarily to the product Ketek®. Inventories pledged as security for liabilities amount to 11 million at December 31, 2010.



F-52



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



D.10. Accounts receivable



Accounts receivable break down as follows:



|            |  |                   |       |   |                   |  |       |                   |  |  |       |  
|----------- |  | ----------------- | ----- | - | ----------------- |  | ----- | ----------------- |  |  | ----- | -
|( million) |  | December 31,
2010 |       |   | December 31,
2009 |  |       | December 31,
2008 | 
|Gross value |  |                   | 6,633 |   |                   |  | 6,111 |                   |  |  | 5,391 |  
|Impairment  |  |                   | (126  | ) |                   |  | (96   | )                 |  |  | (88   | )
|Net value   |  |                   | 6,507 |   |                   |  | 6,015 |                   |  |  | 5,303 |  



The impact of changes in provisions for impairment of accounts receivable in 2010 is a net expense of 32 million, compared with
a net expense of 5 million in 2009 and a net expense of 7 million in 2008.



The gross value of overdue receivables at December 31, 2010 is 887 million (versus 884 million at December 31, 2009 and 794 million at December 31, 2008).



|                  |  |                             |     |  |                  |  |     |                           |  |  |                           |  |  |                            |     |  |                    |  |     |  |  |  |     | 
|----------------- |  | --------------------------- | --- |  | ---------------- |  | --- | ------------------------- |  |  | ------------------------- |  |  | -------------------------- | --- |  | ------------------ |  | --- |  |  |  | --- | 
|( million)       |  | Overdue accountsGross value |     |  | Overdue <1 month |  |     | Overdue from1 to 3 months |  |  | Overdue from3 to 6 months |  |  | Overdue from6 to 12 months |     |  | Overdue >12 months | 
|December 31, 2010 |  |                             | 887 |  |                  |  | 255 |                           |  |  | 207                       |  |  |                            | 127 |  |                    |  | 97  |  |  |  | 201 | 
|December 31, 2009 |  |                             | 884 |  |                  |  | 288 |                           |  |  | 172                       |  |  |                            | 132 |  |                    |  | 110 |  |  |  | 182 | 
|December 31, 2008 |  |                             | 794 |  |                  |  | 267 |                           |  |  | 146                       |  |  |                            | 121 |  |                    |  | 95  |  |  |  | 165 | 



Amounts overdue by more than one month relate mainly to public-sector customers.



D.11. Other current assets



Other current assets break down as follows:



|                     |  |                  |       |  |                  |  |       |                  |  |  |       | 
|-------------------- |  | ---------------- | ----- |  | ---------------- |  | ----- | ---------------- |  |  | ----- | 
|( million)          |  | December 31,2010 |       |  | December 31,2009 |  |       | December 31,2008 | 
|Taxes recoverable    |  |                  | 1,188 |  |                  |  | 1,019 |                  |  |  | 927   | 
|Other receivables(1) |  |                  | 626   |  |                  |  | 914   |                  |  |  | 781   | 
|Prepaid expenses     |  |                  | 186   |  |                  |  | 171   |                  |  |  | 173   | 
|Total                |  |                  | 2,000 |  |                  |  | 2,104 |                  |  |  | 1,881 | 



|(1) | This line mainly comprises amounts due from alliance partners, advance payments
to suppliers, sales commission receivable, and amounts due from employees.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------



D.12. Current financial assets



Current financial assets break down as follows:



|                                                                  |  |                  |    |  |                  |  |     |                  |  |  |     | 
|----------------------------------------------------------------- |  | ---------------- | -- |  | ---------------- |  | --- | ---------------- |  |  | --- | 
|( million)                                                       |  | December 31,2010 |    |  | December 31,2009 |  |     | December 31,2008 | 
|Interest rate derivatives measured at fair value (see Note D.20.) |  |                  | 1  |  |                  |  | 18  |                  |  |  | 33  | 
|Currency derivatives measured at fair value (see Note D.20.)      |  |                  | 27 |  |                  |  | 251 |                  |  |  | 348 | 
|Other current financial assets                                    |  |                  | 23 |  |                  |  | 8   |                  |  |  | 22  | 
|Total                                                             |  |                  | 51 |  |                  |  | 277 |                  |  |  | 403 | 



F-53



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



D.13. Cash and cash equivalents



|                                 |  |                  |       |  |                  |  |       |                  |  |  |       | 
|-------------------------------- |  | ---------------- | ----- |  | ---------------- |  | ----- | ---------------- |  |  | ----- | 
|( million)                      |  | December 31,2010 |       |  | December 31,2009 |  |       | December 31,2008 | 
|Cash                             |  |                  | 696   |  |                  |  | 689   |                  |  |  | 502   | 
|Cash equivalents(1)              |  |                  | 5,769 |  |                  |  | 4,003 |                  |  |  | 3,724 | 
|Cash and cash equivalents (2)(3) |  |                  | 6,465 |  |                  |  | 4,692 |                  |  |  | 4,226 | 



|(1) | Cash equivalents at December 31, 2010 mainly comprised
4,805 million invested in collective investment schemes classified as Euro Money-Market Funds by the Autorité des Marchés Financiers and 786 million of term deposits.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Includes cash held by captive insurance and reinsurance companies in accordance
with insurance regulations: 436 million at December 31, 2010, 430 million at December 31, 2009, and 429 million at December 31, 2008.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Includes 31 million held by the Venezuelan subsidiary, which is
subject to foreign exchange controls.
|--- | ------------------------------------------------------------------------------------------------------



D.14. Net deferred tax position



The net deferred tax position breaks down as follows:



|                                                                      |  |                  |        |   |                  |  |        |                  |  |  |        |  
|--------------------------------------------------------------------- |  | ---------------- | ------ | - | ---------------- |  | ------ | ---------------- |  |  | ------ | -
|( million)                                                           |  | December 31,2010 |        |   | December 31,2009 |  |        | December 31,2008 | 
|Deferred tax on:                                                      |  |                  |        |   |                  |  |        |                  |  |  |        |  
| Consolidation adjustments (intragroup margin in inventory)          |  |                  | 875    |   |                  |  | 858    |                  |  |  | 845    |  
| Provision for pensions and other employee benefits                  |  |                  | 1,157  |   |                  |  | 1,097  |                  |  |  | 1,070  |  
| Remeasurement of acquired intangible assets(1)                      |  |                  | (3,706 | ) |                  |  | (4,144 | )                |  |  | (4,805 | )
| Recognition of acquired property, plant and equipment at fair value |  |                  | (76    | ) |                  |  | (99    | )                |  |  | (65    | )
| Tax cost of distributions made from reserves(2)                     |  |                  | (399   | ) |                  |  | (643   | )                |  |  | (769   | )
| Tax losses available for carry-forward                              |  |                  | 152    |   |                  |  | 70     |                  |  |  | 171    |  
| Stock options                                                       |  |                  | 12     |   |                  |  | 21     |                  |  |  | 6      |  
| Other non-deductible provisions and other items                     |  |                  | 1,228  |   |                  |  | 819    |                  |  |  | 799    |  
|Net deferred tax liability                                            |  |                  | (757   | ) |                  |  | (2,021 | )                |  |  | (2,748 | )



|(1) | Includes a deferred tax liability of 2,559 million as of
December 31, 2010 relating to the remeasurement of Aventis intangible assets.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------

|(2) | In some countries, the Group is liable to withholding taxes and other tax charges
when dividends are distributed. Consequently, the Group recognizes a deferred tax liability on those reserves (approximately 16 billion) which the Group regards as likely to be distributed in the foreseeable future (see Note D.30.).
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The table below
shows when the tax losses available for carry-forward are due to expire:



|                                                                      |  |  |       | 
|--------------------------------------------------------------------- |  |  | ----- | 
|( million)                                                           |  |  |      
|2011                                                                  |  |  | 21    | 
|2012                                                                  |  |  | 19    | 
|2013                                                                  |  |  | 15    | 
|2014                                                                  |  |  | 8     | 
|2015                                                                  |  |  | 17    | 
|2016 and later                                                        |  |  | 948   | 
|Total tax losses available for carry-forward at December 31, 2010 (1) |  |  | 1,028 | 
|Total tax losses available for carry-forward at December 31,
2009     |  |  | 642   | 
|Total tax losses available for carry-forward at December 31,
2008     |  |  | 845   | 



|(1) | Excluding tax loss carry-forwards on asset disposals. Tax loss carry-forwards on
asset disposals amounted to 101 million at December 31, 2010, 597 million at December 31, 2009, and 776 million at December 31, 2008.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Use of these tax loss carry-forwards is limited to the entity
in which they arose. In jurisdictions where tax consolidations are in place, tax losses can be netted against taxable income generated by the entities in the consolidated tax group.



F-54



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Deferred tax assets not recognized because their future recovery was not regarded as
probable given the expected results of the entities in question amounted to 451 million at December 31, 2010 (including 35 million on asset disposals), compared with 486 million at December 31, 2009
(including 99 million on asset disposals) and 374 million at December 31, 2008 (including 162 million on asset disposals).



The effect of recognizing previously unrecognized deferred tax assets in accounting for business combinations (requiring a corresponding
adjustment to goodwill) amounted to 88 million at December 31, 2009 and 6 million at December 31, 2008.



D.15. Consolidated shareholders equity



D.15.1. Share capital



The share capital of 2,621,995,570 consists of 1,310,997,785 shares with a par value of 2.



The number of own shares held by the Group as treasury shares
is as follows:



|                  |  |                  |            |  |   |  |       | 
|----------------- |  | ---------------- | ---------- |  | - |  | ----- | 
|                  |  | Number of shares |            |  | % | 
|December 31, 2010 |  |                  | 6,070,712  |  |   |  | 0.46% | 
|December 31, 2009 |  |                  | 9,422,716  |  |   |  | 0.71% | 
|December 31, 2008 |  |                  | 10,014,971 |  |   |  | 0.76% | 
|January 1, 2008   |  |                  | 37,725,706 |  |   |  | 2.76% | 



Treasury shares are deducted from shareholders equity. Gains and losses on disposals of treasury shares are taken directly to equity
and not recognized in net income for the period.



Movements in the share capital of the sanofi-aventis parent company over the last three years are presented below:



|                                |  |                                                            |  |                 |               |   |              |  |       |                          |  |  |        |  
|------------------------------- |  | ---------------------------------------------------------- |  | --------------- | ------------- | - | ------------ |  | ----- | ------------------------ |  |  | ------ | -
|                                |  |                                                            |  |                 |               |   | ( million)  | 
|Date                            |  | Transaction                                                |  | Number ofshares |               |   | Sharecapital |  |       | Additionalpaid-incapital | 
|January 1, 2008                 |  |                                                            |  |                 | 1,365,916,644 |   |              |  | 2,732 |                          |  |  | 9,410  |  
|During 2008                     |  | Capital increase by exercise of stock subscription options |  |                 | 1,046,238     |   |              |  | 2     |                          |  |  | 37     |  
|Board meeting of April 29, 2008 |  | Capital reduction by cancellation of treasury shares       |  |                 | (51,437,419   | ) |              |  | (103  | )                        |  |  | (2,843 | )
|December 31, 2008               |  |                                                            |  |                 | 1,315,525,463 |   |              |  | 2,631 |                          |  |  | 6,604  |  
|During 2009                     |  | Capital increase by exercise of stock subscription options |  |                 | 2,953,589     |   |              |  | 6     |                          |  |  | 134    |  
|December 31, 2009               |  |                                                            |  |                 | 1,318,479,052 |   |              |  | 2,637 |                          |  |  | 6,738  |  
|During 2010                     |  | Capital increase by exercise of stock subscription options |  |                 | 430,033       |   |              |  | 1     |                          |  |  | 17     |  
|Board meeting of April 28, 2010 |  | Capital reduction by cancellation of treasury shares       |  |                 | (7,911,300    | ) |              |  | (16   | )                        |  |  | (404   | )
|December 31, 2010               |  |                                                            |  |                 | 1,310,997,785 |   |              |  | 2,622 |                          |  |  | 6,351  |  



For disclosures about the management of capital as required under IFRS 7, refer to Note B.27.



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



D.15.2. Restricted share plans



Restricted share plans are accounted for in accordance with the policies described in Note B.24.3.



| |  |  | The meeting of the sanofi-aventis Board of Directors held on October 27, 2010 decided to award a worldwide restricted share plan, under which 20
shares were granted to each employee of the Group. The fair value per share granted is the market price of the share as of the date of grant (49.53), adjusted for expected dividends during the vesting period. A total of 2,101,340 shares were
granted under this plan.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The
fair value of this restricted share plan is 67 million.



| |  |  | The meeting of the sanofi-aventis Board of Directors held on March 1, 2010 decided to award a discretionary restricted share plan. A total of
1,231,249 shares were granted, 699,524 of which will vest after a four-year service period and 531,725 of which will vest after a two-year service period but will be subject to a further two-year lock-up period. The fair value per share granted is
the market price of the share as of the date of grant (54.82), adjusted for expected dividends during the vesting period.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The fair value of this restricted share plan is 50 million.



The total expense recognized for restricted share plans in
the year ended December 31, 2010 was 36 million, compared with 11 million in the year ended December 31, 2009.



As of December 31, 2010, there were 4,467,968 restricted shares outstanding: 2,101,340 under the October 2010 plan, 1,208,261 under
the March 2010 plan, and 1,158,367 under the 2009 plan. As of December 31, 2009, there were 1,181,049 restricted shares outstanding.



| |  |  | The meeting of the sanofi-aventis Board of Directors held on March 2, 2009 decided to award a restricted share plan. A total of 1,194,064 shares
were granted, 604,004 of which will vest after a four-year service period and 590,060 of which will vest after a two-year service period but will be subject to a further two-year lock-up period (including 65,000 shares which are also contingent upon
performance conditions). The fair value per share granted is the market price per share as of the date of grant (41.10), adjusted for expected dividends during the vesting period.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The fair value of this restricted share plan is 37
million.



D.15.3. Capital increase reserved for employee share
ownership plans



There were no share issues
reserved for employee share ownership plans in 2010, 2009 or 2008.



D.15.4. Repurchase of sanofi-aventis shares



The sanofi-aventis Shareholders Annual General Meeting of May 17, 2010 authorized a share repurchase program for a period of 18
months. Sanofi-aventis has not repurchased any of its own shares under this program since that date.



Under the share repurchase program authorized by the Shareholders Annual General Meeting of April 17, 2009, sanofi-aventis
repurchased 5,871,026 of its own shares during 2010 for a total of 321 million.



Sanofi-aventis did not repurchase any of its own shares during 2009.



The Shareholders Annual General Meeting of May 14, 2008 authorized a share repurchase program, under which sanofi-aventis
purchased 810,000 of its own shares during the period from June 6, 2008 through August 21, 2008 for a total of 36 million (including transaction costs).



D.15.5. Reduction in share capital



The meeting of the sanofi-aventis Board of Directors held on
April 28, 2010 decided to cancel 7,911,300 treasury shares (420 million), representing 0.60% of the share capital as of that date.



F-56



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The meeting of the sanofi-aventis Board of Directors held on April 29, 2008 decided
to cancel 51,437,419 treasury shares (2,946 million), of which 51,407,169 had been repurchased through April 14, 2008 under the share repurchase program, representing 3.77% of the share capital as of that date (see Note D.15.4.).



These cancellations had no effect on consolidated
shareholders equity.



D.15.6. Cumulative translation
differences



Cumulative translation
differences break down as follows:



|                                                 |  |                  |        |   |                     |  |        |                  |  |  |        |  
|------------------------------------------------ |  | ---------------- | ------ | - | ------------------- |  | ------ | ---------------- |  |  | ------ | -
|( million)                                      |  | December 31,2010 |        |   | December 31,2009(1) |  |        | December 31,2008 | 
|Attributable to equity holders of sanofi-aventis |  |                  | (1,318 | ) |                     |  | (3,962 | )                |  |  | (3,669 | )
|Attributable to non-controlling interests        |  |                  | (4     | ) |                     |  | (15    | )                |  |  | (16    | )
|Total                                            |  |                  | (1,322 | ) |                     |  | (3,977 | )                |  |  | (3,685 | )



|(1) | In
accordance with IFRS 3 (Business Combinations), sanofi-aventis adjusted the values of certain identifiable assets and liabilities of Merial during the purchase price allocation period (see Note D.1.); the impact on cumulative translation differences
was 3 million.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The movement in cumulative translation differences during the period was mainly due to the effect of changes in the U.S. dollar exchange
rate, primarily on goodwill, intangible assets and inventories.



In accordance with the accounting policy described in Note B.8.4., cumulative translation differences attributable to equity holders of sanofi-aventis include the post-tax effect of currency hedges
of net investments in foreign operations, which amounted to 85 million at December 31, 2010 compared with 86 million at December 31, 2009 and 98 million at December 31, 2008.



F-57



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



D.15.7. Income and expenses recognized directly in equity



Movements in income and expenses recognized directly in
equity break down as follows:



|                                                                           |  |                            |        |   |                                |  |        |                            |  |  |        |  
|-------------------------------------------------------------------------- |  | -------------------------- | ------ | - | ------------------------------ |  | ------ | -------------------------- |  |  | ------ | -
|( million)                                                                |  | Year endedDecember 31,2010 |        |   | Year endedDecember 31,2009
(1) |  |        | Year endedDecember 31,2008 | 
|Balance, beginning of period                                               |  |                            | (3,755 | ) |                                |  | (4,436 | )                          |  |  | (4,659 | )
|Available-for-sale financial assets:                                       |  |                            |        |   |                                |  |        |                            |  |  |        |  
| Change in fair value(2)                                                  |  |                            | 141    |   |                                |  | 110    |                            |  |  | (132   | )
| Tax effects                                                              |  |                            | (15    | ) |                                |  | (23    | )                          |  |  | 33     |  
|Cash flow hedges:                                                          |  |                            |        |   |                                |  |        |                            |  |  |        |  
| Change in fair value(3)                                                  |  |                            | 17     |   |                                |  | (175   | )                          |  |  | 104    |  
| Tax effects                                                              |  |                            | (6     | ) |                                |  | 61     |                            |  |  | (37    | )
|Zentiva fair value remeasurement:                                          |  |                            |        |   |                                |  |        |                            |  |  |        |  
| Change in fair value(4)                                                  |  |                            |       |   |                                |  | 108    |                            |  |  |       |  
| Tax effects                                                              |  |                            |       |   |                                |  | (28    | )                          |  |  |       |  
|Merial fair value remeasurement:                                           |  |                            |        |   |                                |  |        |                            |  |  |        |  
| Change in fair value(4)                                                  |  |                            |       |   |                                |  | 1,379  |                            |  |  |       |  
| Tax effects                                                              |  |                            |       |   |                                |  | (326   | )                          |  |  |       |  
|Actuarial gains and losses                                                 |  |                            |        |   |                                |  |        |                            |  |  |        |  
| Impact of asset ceiling                                                  |  |                            | 1      |   |                                |  | 2      |                            |  |  | 2      |  
| Actuarial gains/(losses) excluding associates, joint ventures and Merial |  |                            | (316   | ) |                                |  | (169   | )                          |  |  | (824   | )
| Actuarial gains/(losses) on associates and joint ventures                |  |                            | (1     | ) |                                |  | (2     | )                          |  |  | (7     | )
| Actuarial gains/(losses) on Merial                                       |  |                            | 5      |   |                                |  |       |                            |  |  |       |  
| Tax effects                                                              |  |                            | 172    |   |                                |  | 36     |                            |  |  | 136    |  
|Change in cumulative translation differences                               |  |                            |        |   |                                |  |        |                            |  |  |        |  
| Translation differences on foreign subsidiaries(5)/(6)                   |  |                            | 2,656  |   |                                |  | (280   | )                          |  |  | 948    |  
| Hedges of net investments in foreign operations                          |  |                            | (2     | ) |                                |  | (18    | )                          |  |  |       |  
| Tax effects                                                              |  |                            | 1      |   |                                |  | 6      |                            |  |  |       |  
|Balance, end of period                                                     |  |                            | (1,102 | ) |                                |  | (3,755 | )                          |  |  | (4,436 | )
|Attributable to equity holders of sanofi-aventis                           |  |                            | (1,097 | ) |                                |  | (3,739 | )                          |  |  | (4,419 | )
|Attributable to non-controlling interests                                  |  |                            | (5     | ) |                                |  | (16    | )                          |  |  | (17    | )



|(1) | In
accordance with IFRS 3 (Business Combinations), sanofi-aventis adjusted the values of certain identifiable assets and liabilities of Merial during the purchase price allocation period (see Note D.1.); the impact on the fair value remeasurement was
164 million before tax effects, and a tax effect of (33) million.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Includes reclassifications to profit or loss: (0.4) million in 2010,
(1) million in 2009, and (11) million in 2008.
|--- | ----------------------------------------------------------------------------------------------------------------------

|(3) | Includes reclassifications to profit or loss: 7 million in 2010,
(123) million in 2009 and (9) million in 2008 in operating income; 5 million in 2010, (35) million in 2009 and (17) million in 2008 in net financial expense.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Fair value remeasurement of the previously-held equity interest (Zentiva 24.9%,
Merial 50%) as of the date when control was acquired.
|--- | -------------------------------------------------------------------------------------------------------------------------------------

|(5) | Includes 155 million for Merial in 2010, and 10 million for
Merial from the acquisition date through December 31, 2009.
|--- | -------------------------------------------------------------------------------------------------------------------------

|(6) | Includes a reclassification of 3 million to profit or loss in 2010.
|--- | --------------------------------------------------------------------



F-58



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



D.15.8. Share-based payment



Stock option plans



a) Assumption by sanofi-aventis of the obligations of Aventis



Stock subscription option plans



With effect from December 31, 2004, sanofi-aventis
substituted for Aventis in all the rights and obligations of the issuer in respect of stock subscription options granted to employees and former corporate officers of Aventis and of related companies (as defined in article L.225-180 of the
Commercial Code) and not exercised as of that date.



With effect from December 31, 2004, stock subscription options granted by Aventis and not yet exercised may be exercised in
sanofi-aventis shares on the same terms, subject to the adjustments described below. The number and subscription price of the optioned shares have been adjusted to reflect the share exchange ratio applicable to Aventis shareholders, subject to
possible further adjustment in the event of future capital transactions. The new terms for the exercise of options, subject to future financial adjustments, are as follows:



| |  |  | The number of sanofi-aventis shares for which each grantee may subscribe under a given stock option plan equals the number of Aventis shares to which
the grantee may subscribe under that plan multiplied by the exchange ratio applicable to the shareholders (i.e. 27/23), rounded down to the nearest whole number.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The subscription price per sanofi-aventis share equals the subscription price per Aventis share divided by the exchange ratio applicable to the
shareholders (i.e. 27/23), rounded down to the nearest euro cent.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



b) Description of stock option plans



2010 stock subscription option plan awarded by sanofi-aventis



On March 1, 2010, the sanofi-aventis Board of Directors granted 8,121,355 stock subscription options at an exercise price of
54.12 per share.



The vesting period is
four years, and the plan expires on February 28, 2020.



2009 stock subscription option plan awarded by sanofi-aventis



On March 2, 2009, the Board of Directors granted
7,736,480 stock subscription options at an exercise price of 45.09 per share.



The vesting period is four years, and the plan expires on March 2, 2019.



F-59



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Stock purchase option plans



The table shows all sanofi-aventis stock purchase option
plans still outstanding or under which options were exercised in the year ended December 31, 2010.



|                  |  |               |            |  |                |  |           |                              |  |  |                |  |  |                   |            |  |                                       |  |       |  |  |  |           | 
|----------------- |  | ------------- | ---------- |  | -------------- |  | --------- | ---------------------------- |  |  | -------------- |  |  | ----------------- | ---------- |  | ------------------------------------- |  | ----- |  |  |  | --------- | 
|Origin            |  | Date of grant |            |  | Optionsgranted |  |           | Start date ofexercise period |  |  | Expirationdate |  |  | Exerciseprice () |            |  | Optionsoutstanding atDecember 31,2010 | 
|Synthélabo        |  |               | 12/15/1993 |  |                |  | 364,000   |                              |  |  | 12/15/1998     |  |  |                   | 12/15/2013 |  |                                       |  | 6.36  |  |  |  | 6,200     | 
|Synthélabo        |  |               | 10/18/1994 |  |                |  | 330,200   |                              |  |  | 10/18/1999     |  |  |                   | 10/18/2014 |  |                                       |  | 6.01  |  |  |  | 10,900    | 
|Synthélabo        |  |               | 01/12/1996 |  |                |  | 208,000   |                              |  |  | 01/12/2001     |  |  |                   | 01/12/2016 |  |                                       |  | 8.56  |  |  |  | 19,270    | 
|Synthélabo        |  |               | 04/05/1996 |  |                |  | 228,800   |                              |  |  | 04/05/2001     |  |  |                   | 04/05/2016 |  |                                       |  | 10.85 |  |  |  | 34,670    | 
|Synthélabo        |  |               | 10/14/1997 |  |                |  | 262,080   |                              |  |  | 10/14/2002     |  |  |                   | 10/14/2017 |  |                                       |  | 19.73 |  |  |  | 29,242    | 
|Synthélabo        |  |               | 06/25/1998 |  |                |  | 296,400   |                              |  |  | 06/26/2003     |  |  |                   | 06/25/2018 |  |                                       |  | 28.38 |  |  |  | 10,520    | 
|Synthélabo        |  |               | 03/30/1999 |  |                |  | 716,040   |                              |  |  | 03/31/2004     |  |  |                   | 03/30/2019 |  |                                       |  | 38.08 |  |  |  | 320,185   | 
|Sanofi-Synthélabo |  |               | 05/24/2000 |  |                |  | 4,292,000 |                              |  |  | 05/25/2004     |  |  |                   | 05/24/2010 |  |                                       |  | 43.25 |  |  |  |          | 
|Sanofi-Synthélabo |  |               | 05/10/2001 |  |                |  | 2,936,500 |                              |  |  | 05/11/2005     |  |  |                   | 05/10/2011 |  |                                       |  | 64.50 |  |  |  | 2,535,539 | 
|Sanofi-Synthélabo |  |               | 05/22/2002 |  |                |  | 3,111,850 |                              |  |  | 05/23/2006     |  |  |                   | 05/22/2012 |  |                                       |  | 69.94 |  |  |  | 2,880,750 | 
|Total             |  |               |            |  |                |  |           |                              |  |  |                |  |  |                   |            |  |                                       |  |       |  |  |  | 5,847,276 | 



Sanofi-aventis shares acquired to cover stock purchase options are deducted from shareholders equity. The exercise of all
outstanding stock purchase options would increase shareholders equity by 375 million.



Stock subscription option plans



Details of the terms of exercise of stock subscription options granted under the various plans are presented below in sanofi-aventis share equivalents. These options have been granted to certain corporate
officers and employees of Group companies.



F-60



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The table shows all sanofi-aventis stock subscription option plans still outstanding or
under which options were exercised in the year ended December 31, 2010.



|                  |  |               |            |  |                |  |            |                              |  |  |                |  |  |                   |            |  |                                        |  |       |  |  |  |            | 
|----------------- |  | ------------- | ---------- |  | -------------- |  | ---------- | ---------------------------- |  |  | -------------- |  |  | ----------------- | ---------- |  | -------------------------------------- |  | ----- |  |  |  | ---------- | 
|Origin            |  | Date of grant |            |  | Optionsgranted |  |            | Start date ofexercise period |  |  | Expirationdate |  |  | Exerciseprice () |            |  | Optionsoutstanding atDecember 31, 2010 | 
|Aventis           |  |               | 05/11/2000 |  |                |  | 877,766    |                              |  |  | 05/11/2003     |  |  |                   | 05/11/2010 |  |                                        |  | 49.65 |  |  |  |           | 
|Aventis           |  |               | 11/14/2000 |  |                |  | 13,966,871 |                              |  |  | 11/15/2003     |  |  |                   | 11/14/2010 |  |                                        |  | 67.93 |  |  |  |           | 
|Aventis           |  |               | 03/29/2001 |  |                |  | 612,196    |                              |  |  | 03/30/2004     |  |  |                   | 03/29/2011 |  |                                        |  | 68.94 |  |  |  | 546,756    | 
|Aventis           |  |               | 11/07/2001 |  |                |  | 13,374,051 |                              |  |  | 11/08/2004     |  |  |                   | 11/07/2011 |  |                                        |  | 71.39 |  |  |  | 9,516,335  | 
|Aventis           |  |               | 03/06/2002 |  |                |  | 1,173,913  |                              |  |  | 03/07/2005     |  |  |                   | 03/06/2012 |  |                                        |  | 69.82 |  |  |  | 1,173,906  | 
|Aventis           |  |               | 11/12/2002 |  |                |  | 11,775,414 |                              |  |  | 11/13/2005     |  |  |                   | 11/12/2012 |  |                                        |  | 51.34 |  |  |  | 5,250,212  | 
|Aventis           |  |               | 12/02/2003 |  |                |  | 12,012,414 |                              |  |  | 12/03/2006     |  |  |                   | 12/02/2013 |  |                                        |  | 40.48 |  |  |  | 5,274,033  | 
|Sanofi-Synthélabo |  |               | 12/10/2003 |  |                |  | 4,217,700  |                              |  |  | 12/11/2007     |  |  |                   | 12/10/2013 |  |                                        |  | 55.74 |  |  |  | 3,816,770  | 
|Sanofi-aventis    |  |               | 05/31/2005 |  |                |  | 15,228,505 |                              |  |  | 06/01/2009     |  |  |                   | 05/31/2015 |  |                                        |  | 70.38 |  |  |  | 13,362,425 | 
|Sanofi-aventis    |  |               | 12/14/2006 |  |                |  | 11,772,050 |                              |  |  | 12/15/2010     |  |  |                   | 12/14/2016 |  |                                        |  | 66.91 |  |  |  | 10,875,740 | 
|Sanofi-aventis    |  |               | 12/13/2007 |  |                |  | 11,988,975 |                              |  |  | 12/14/2011     |  |  |                   | 12/13/2017 |  |                                        |  | 62.33 |  |  |  | 11,239,195 | 
|Sanofi-aventis    |  |               | 03/02/2009 |  |                |  | 7,736,480  |                              |  |  | 03/04/2013     |  |  |                   | 03/01/2019 |  |                                        |  | 45.09 |  |  |  | 7,421,945  | 
|Sanofi-aventis    |  |               | 03/01/2010 |  |                |  | 8,121,355  |                              |  |  | 03/03/2014     |  |  |                   | 02/28/2020 |  |                                        |  | 54.12 |  |  |  | 7,946,335  | 
|Total             |  |               |            |  |                |  |            |                              |  |  |                |  |  |                   |            |  |                                        |  |       |  |  |  | 76,423,652 | 



The exercise of all outstanding stock subscription options would increase shareholders equity by approximately 4,628 million.
The exercise of each option results in the issuance of one share.



F-61



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Summary of stock option plans



A summary of stock options outstanding at each balance sheet date, and of changes during the relevant periods,
is presented below:



|                                         |  |                  |             |   |                               |  |       |                  |  |  |       |  
|---------------------------------------- |  | ---------------- | ----------- | - | ----------------------------- |  | ----- | ---------------- |  |  | ----- | -
|                                         |  |                  |             |   | Exercise price                | 
|                                         |  | Number ofoptions |             |   | Weighted averageper share () |  |       | Total( million) | 
|Options outstanding at January 1, 2008   |  |                  | 88,275,695  |   |                               |  | 62.34 |                  |  |  | 5,503 |  
|Of which exercisable                     |  |                  | 50,643,150  |   |                               |  | 59.05 |                  |  |  | 2,991 |  
|Options exercised                        |  |                  | (1,141,554  | ) |                               |  | 36.82 |                  |  |  | (42   | )
|Options cancelled(1)                     |  |                  | (1,682,800  | ) |                               |  | 65.51 |                  |  |  | (110  | )
|Options forfeited                        |  |                  | (146,391    | ) |                               |  | 34.14 |                  |  |  | (5    | )
|Options outstanding at December 31, 2008 |  |                  | 85,304,950  |   |                               |  | 62.66 |                  |  |  | 5,345 |  
|Of which exercisable                     |  |                  | 48,713,680  |   |                               |  | 59.59 |                  |  |  | 2,903 |  
|Options granted                          |  |                  | 7,736,480   |   |                               |  | 45.09 |                  |  |  | 349   |  
|Options exercised                        |  |                  | (3,545,344  | ) |                               |  | 46.69 |                  |  |  | (165  | )
|Options cancelled(1)                     |  |                  | (1,000,535  | ) |                               |  | 61.72 |                  |  |  | (62   | )
|Options forfeited                        |  |                  | (625,210    | ) |                               |  | 48.89 |                  |  |  | (31   | )
|Options outstanding at December 31, 2009 |  |                  | 87,870,341  |   |                               |  | 61.87 |                  |  |  | 5,436 |  
|Of which exercisable                     |  |                  | 57,717,316  |   |                               |  | 63.04 |                  |  |  | 3,638 |  
|Options granted                          |  |                  | 8,121,355   |   |                               |  | 54.12 |                  |  |  | 440   |  
|Options exercised                        |  |                  | (1,756,763  | ) |                               |  | 42.50 |                  |  |  | (75   | )
|Options cancelled(1)                     |  |                  | (11,609,223 | ) |                               |  | 67.01 |                  |  |  | (778  | )
|Options forfeited                        |  |                  | (354,782    | ) |                               |  | 46.24 |                  |  |  | (16   | )
|Options outstanding at December 31, 2010 |  |                  | 82,270,928  |   |                               |  | 60.86 |                  |  |  | 5,007 |  
|Of which exercisable                     |  |                  | 55,663,453  |   |                               |  | 63.63 |                  |  |  | 3,542 |  



|(1) | Cancellations mainly due to the departure of the grantees.
|--- | ----------------------------------------------------------



The table below
provides summary information about options outstanding and exercisable as of December 31, 2010:



|                                      |  |                  |            |  |                                |  |      |                                           |  |  |       |  |  |                  |  |  |                                           |  |            |  |  |  |       | 
|------------------------------------- |  | ---------------- | ---------- |  | ------------------------------ |  | ---- | ----------------------------------------- |  |  | ----- |  |  | ---------------- |  |  | ----------------------------------------- |  | ---------- |  |  |  | ----- | 
|                                      |  | Outstanding      |            |  |                                |  |      | Exercisable                               | 
|Range of exercise prices per share    |  | Number ofoptions |            |  | Averageresidual life(in years) |  |      | Weightedaverageexerciseprice pershare () |  |  |       |  |  | Number ofoptions |  |  | Weightedaverageexerciseprice pershare () | 
|From 1.00 to 10.00 per share        |  |                  | 36,370     |  |                                |  | 4.31 |                                           |  |  | 7.42  |  |  |                  |  |  |                                           |  | 36,370     |  |  |  | 7.42  | 
|From 10.00 to 20.00 per share       |  |                  | 63,912     |  |                                |  | 5.96 |                                           |  |  | 14.91 |  |  |                  |  |  |                                           |  | 63,912     |  |  |  | 14.91 | 
|From 20.00 to 30.00 per share       |  |                  | 10,520     |  |                                |  | 7.49 |                                           |  |  | 28.38 |  |  |                  |  |  |                                           |  | 10,520     |  |  |  | 28.38 | 
|From 30.00 to 40.00 per share       |  |                  | 320,185    |  |                                |  | 8.25 |                                           |  |  | 38.08 |  |  |                  |  |  |                                           |  | 320,185    |  |  |  | 38.08 | 
|From 40.00 to 50.00 per share       |  |                  | 12,695,978 |  |                                |  | 5.99 |                                           |  |  | 43.17 |  |  |                  |  |  |                                           |  | 5,274,033  |  |  |  | 40.48 | 
|From 50.00 to 60.00 per share       |  |                  | 17,013,317 |  |                                |  | 5.52 |                                           |  |  | 53.63 |  |  |                  |  |  |                                           |  | 9,066,982  |  |  |  | 53.19 | 
|From 60.00 to 70.00 per share       |  |                  | 29,251,886 |  |                                |  | 5.11 |                                           |  |  | 65.39 |  |  |                  |  |  |                                           |  | 18,012,691 |  |  |  | 67.31 | 
|From 70.00 to 80.00 per share       |  |                  | 22,878,760 |  |                                |  | 2.93 |                                           |  |  | 70.80 |  |  |                  |  |  |                                           |  | 22,878,760 |  |  |  | 70.80 | 
|Total                                 |  |                  | 82,270,928 |  |                                |  |      |                                           |  |  |       |  |  |                  |  |  |                                           |  | 55,663,453 |  |  |  |       | 
| of which stock purchase options     |  |                  | 5,847,276  |  |                                |  |      |                                           |  |  |       |  |  |                  |  |  |                                           |  | 5,847,276  |  |  |  |       | 
| of which stock subscription options |  |                  | 76,423,652 |  |                                |  |      |                                           |  |  |       |  |  |                  |  |  |                                           |  | 49,816,177 |  |  |  |       | 



F-62



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Measurement of stock option plans



The fair value of the plan awarded in 2010 is 66 million. This amount is recognized as an expense over
the vesting period, with the matching entry to shareholders equity. On this basis, an expense of 14 million was recognized in the year ended December 31, 2010.



The fair value of the plan awarded in 2009 is 34 million.



The following assumptions were used in determining the fair
value of these plans:



| |  |  | Dividend yield: 4.66% (2010 plan), 5.72% (2009 plan).
| | - |  | -----------------------------------------------------



| |  |  | Volatility of sanofi-aventis shares, computed on a historical basis: 27.08% (2010 plan), 27.06% (2009 plan).
| | - |  | ------------------------------------------------------------------------------------------------------------



| |  |  | Risk-free interest rate: 2.56% (2010 plan), 2.84% (2009 plan).
| | - |  | --------------------------------------------------------------



| |  |  | Plan maturity: 6 years (2010 and 2009 plans). The plan maturity is the average expected remaining life of the options, based on observations of past
employee behavior.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------



The fair
value of the options granted in 2010 and 2009 is 9.09 and 4.95 per option, respectively.



The expense recognized for stock option plans, and the matching entry taken to shareholders equity, was 97 million in the
year ended December 31, 2010 (including 10 million for the Vaccines segment), 102 million in the year ended December 31, 2009 (including 12 million for the Vaccines segment), and 125 million in
the year ended December 31, 2008 (including 13 million for the Vaccines segment).



As of December 31, 2010, the total cost related to non-vested stock option plans was 103 million, to be recognized over a weighted average period of 2.31 years. The current tax benefit
related to the exercise of stock options in 2010 was 1 million in 2010, 2 million in 2009, and 2 million in 2008.



D.15.9. Number of shares used to compute diluted earnings per share



Diluted earnings per share is computed using the number of
shares outstanding plus stock options with a potentially dilutive effect.



|                                                                    |  |                  |         |  |                  |  |         |                  |  |  |         | 
|------------------------------------------------------------------- |  | ---------------- | ------- |  | ---------------- |  | ------- | ---------------- |  |  | ------- | 
|(in millions)                                                       |  | December 31,2010 |         |  | December 31,2009 |  |         | December 31,2008 | 
|Average number of shares outstanding                                |  |                  | 1,305.3 |  |                  |  | 1,305.9 |                  |  |  | 1,309.3 | 
|Adjustment for options with potentially dilutive effect             |  |                  | 1.7     |  |                  |  | 1.1     |                  |  |  | 1.6     | 
|Adjustment for restricted shares with potentially dilutive effect   |  |                  | 1.2     |  |                  |  | 0.4     |                  |  |  |        | 
|Average number of shares used to compute diluted earnings per share |  |                  | 1,308.2 |  |                  |  | 1,307.4 |                  |  |  | 1,310.9 | 



In 2010, a total of 69.1 million stock options were not taken into account in the calculation because they did not have a potentially
dilutive effect, compared with 80.3 million in 2009 and 76.2 million in 2008.



F-63



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



D.16. Non-controlling interests



Non-controlling interests in consolidated companies break
down as follows:



|                                                    |  |                  |     |  |                  |  |     |                  |  |  |     | 
|--------------------------------------------------- |  | ---------------- | --- |  | ---------------- |  | --- | ---------------- |  |  | --- | 
|( million)                                         |  | December 31,2010 |     |  | December 31,2009 |  |     | December 31,2008 | 
|Non-controlling interests of ordinary shareholders: |  |                  |     |  |                  |  |     |                  |  |  |     | 
| BMS(1)                                            |  |                  | 41  |  |                  |  | 104 |                  |  |  | 111 | 
| Zentiva                                           |  |                  | 28  |  |                  |  | 32  |                  |  |  |    | 
| Aventis Pharma Ltd India                          |  |                  | 75  |  |                  |  | 73  |                  |  |  | 60  | 
| Maphar                                            |  |                  | 7   |  |                  |  | 7   |                  |  |  | 6   | 
| Sanofi-aventis Korea                              |  |                  | 7   |  |                  |  | 5   |                  |  |  | 4   | 
| Shantha Biotechnics                               |  |                  | 9   |  |                  |  | 12  |                  |  |  |    | 
| Other                                             |  |                  | 24  |  |                  |  | 25  |                  |  |  | 24  | 
|Total                                               |  |                  | 191 |  |                  |  | 258 |                  |  |  | 205 | 



|(1) | Under the terms of the agreements with BMS (see Note C.1.), the BMS share of the
net assets of entities majority-owned by sanofi-aventis is recognized inNon-controlling interests(refer to the statement of changes in equity).
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



D.17. Debt, cash and cash equivalents



The table below shows changes in the Groups financial position over the last three years:



|                                                          |  |                  |        |   |                  |  |        |                  |  |  |        |  
|--------------------------------------------------------- |  | ---------------- | ------ | - | ---------------- |  | ------ | ---------------- |  |  | ------ | -
|( million)                                               |  | December 31,2010 |        |   | December 31,2009 |  |        | December 31,2008 | 
|Long-term debt                                            |  |                  | 6,695  |   |                  |  | 5,961  |                  |  |  | 4,173  |  
|Short-term debt and current portion of long-term debt     |  |                  | 1,565  |   |                  |  | 2,866  |                  |  |  | 1,833  |  
|Interest rate and currency derivatives used to hedge debt |  |                  | (218   | ) |                  |  | (7     | )                |  |  | 22     |  
|Total debt                                                |  |                  | 8,042  |   |                  |  | 8,820  |                  |  |  | 6,028  |  
|Cash and cash equivalents                                 |  |                  | (6,465 | ) |                  |  | (4,692 | )                |  |  | (4,226 | )
|Debt, net of cash and cash equivalents                    |  |                  | 1,577  |   |                  |  | 4,128  |                  |  |  | 1,802  |  



Debt, net of cash and cash equivalents is a non-GAAP financial indicator used by management and investors to measure the
companys overall net indebtedness.



Trends
in the gearing ratio are shown below:



|                                       |  |                  |        |   |                  |  |        |                  |  |  |        |  
|-------------------------------------- |  | ---------------- | ------ | - | ---------------- |  | ------ | ---------------- |  |  | ------ | -
|( million)                            |  | December 31,2010 |        |   | December 31,2009 |  |        | December 31,2008 | 
|Debt, net of cash and cash equivalents |  |                  | 1,577  |   |                  |  | 4,128  |                  |  |  | 1,802  |  
|Total equity                           |  |                  | 53,288 |   |                  |  | 48,580 |                  |  |  | 45,071 |  
|Gearing ratio                          |  |                  | 3.0    | % |                  |  | 8.5    | %                |  |  | 4.0    | %



F-64



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



A reconciliation of carrying amount to value on redemption is shown below:



|                                                          |  |                              |        |   |               |  |    |                                         |  |  |                     |   |  |               |        |   |               |  |        |   |  |  |        |  
|--------------------------------------------------------- |  | ---------------------------- | ------ | - | ------------- |  | -- | --------------------------------------- |  |  | ------------------- | - |  | ------------- | ------ | - | ------------- |  | ------ | - |  |  | ------ | -
|                                                          |  |                              |        |   |               |  |    |                                         |  |  | Value on redemption |  
|( million)                                               |  | Carryingamount:Dec. 31, 2010 |        |   | Amortizedcost |  |    | Adjustment todebt measuredat fair value |  |  | Dec. 31, 2010       |   |  | Dec. 31, 2009 |        |   | Dec. 31, 2008 | 
|Long-term debt                                            |  |                              | 6,695  |   |               |  | 27 |                                         |  |  | (39                 | ) |  |               | 6,683  |   |               |  | 5,943  |   |  |  | 4,123  |  
|Short-term debt and current portion of long-term debt     |  |                              | 1,565  |   |               |  |   |                                         |  |  |                    |   |  |               | 1,565  |   |               |  | 2,853  |   |  |  | 1,815  |  
|Interest rate and currency derivatives used to hedge debt |  |                              | (218   | ) |               |  |   |                                         |  |  | 26                  |   |  |               | (192   | ) |               |  | 8      |   |  |  | 22     |  
|Total debt                                                |  |                              | 8,042  |   |               |  | 27 |                                         |  |  | (13                 | ) |  |               | 8,056  |   |               |  | 8,804  |   |  |  | 5,960  |  
|Cash and cash equivalents                                 |  |                              | (6,465 | ) |               |  |   |                                         |  |  |                    |   |  |               | (6,465 | ) |               |  | (4,692 | ) |  |  | (4,226 | )
|Debt, net of cash and cash equivalents                    |  |                              | 1,577  |   |               |  | 27 |                                         |  |  | (13                 | ) |  |               | 1,591  |   |               |  | 4,112  |   |  |  | 1,734  |  



a) Principal financing transactions during the year



The following financing transaction took place during 2010:



| |  |  | Issuance in April 2010 of a supplementary tranche of 500 million to the existing fixed-rate bond issue (annual rate of 3.125%) maturing
October 10, 2014.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------



Three
bond issues were repaid on maturity:



| |  |  | January 2007 bond issue with a nominal value of £200 million (227 million), which matured January 18, 2010;
| | - |  | ------------------------------------------------------------------------------------------------------------



| |  |  | December 2007 bond issue with a nominal value of CHF 200 million (136 million), which matured January 21, 2010;
| | - |  | ----------------------------------------------------------------------------------------------------------------



| |  |  | September 2003 bond issue with a nominal value of 1.5 billion, which matured September 15, 2010.
| | - |  | -------------------------------------------------------------------------------------------------



On July 6, 2010, sanofi-aventis contracted a new 7
billion general-purpose syndicated credit facility with a pool of sixteen banks. This facility may be drawn down in either euros or U.S. dollars, and expires on July 6, 2015.



On the same day, sanofi-aventis terminated ahead of the
contractual expiry date (i) a 4 billion syndicated credit facility due to expire January 12, 2011 and (ii) two bilateral credit facilities totaling $850 million, and also reduced an existing 8 billion credit facility to
6 billion.



In connection with the launch of
the public tender offer for Genzyme on October 4, 2010, sanofi-aventis contracted two acquisition facilities on October 2, 2010. These facilities total $15 billion and may be drawn down in U.S. dollars up to and including July 2,
2011. Details about these facilities are provided below.



F-65



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



b) Debt, net of cash and cash equivalents by type, at value on redemption



|                                                          |  |                   |       |   |                   |  |        |                   |  |  |             |   |  |         |       |   |       |  |        |             |  |  |         |   |  |       |       |  |  |  |        |   |  |  |        |  
|--------------------------------------------------------- |  | ----------------- | ----- | - | ----------------- |  | ------ | ----------------- |  |  | ----------- | - |  | ------- | ----- | - | ----- |  | ------ | ----------- |  |  | ------- | - |  | ----- | ----- |  |  |  | ------ | - |  |  | ------ | -
|( million)                                               |  | December 31, 2010 |       |   | December 31, 2009 |  |        | December 31, 2008 | 
|                                                          |  | Non-current       |       |   | Current           |  |        | Total             |  |  | Non-current |   |  | Current |       |   | Total |  |        | Non-current |  |  | Current |   |  | Total |      
|Bond issues                                               |  |                   | 5,879 |   |                   |  | 92     |                   |  |  | 5,971       |   |  |         | 5,236 |   |       |  | 1,982  |             |  |  | 7,218   |   |  |       | 2,418 |  |  |  | 488    |   |  |  | 2,906  |  
|Other bank borrowings                                     |  |                   | 771   |   |                   |  | 402    |                   |  |  | 1,173       |   |  |         | 678   |   |       |  | 529    |             |  |  | 1,207   |   |  |       | 670   |  |  |  | 262    |   |  |  | 932    |  
|Commercial paper                                          |  |                   |      |   |                   |  | 735    |                   |  |  | 735         |   |  |         |      |   |       |  |       |             |  |  |        |   |  |       |      |  |  |  | 717    |   |  |  | 717    |  
|Finance lease obligations                                 |  |                   | 19    |   |                   |  | 6      |                   |  |  | 25          |   |  |         | 15    |   |       |  | 9      |             |  |  | 24      |   |  |       | 21    |  |  |  | 4      |   |  |  | 25     |  
|Other borrowings                                          |  |                   | 14    |   |                   |  | 57     |                   |  |  | 71          |   |  |         | 14    |   |       |  | 16     |             |  |  | 30      |   |  |       | 14    |  |  |  | 11     |   |  |  | 25     |  
|Bank credit balances                                      |  |                   |      |   |                   |  | 273    |                   |  |  | 273         |   |  |         |      |   |       |  | 317    |             |  |  | 317     |   |  |       |      |  |  |  | 299    |   |  |  | 299    |  
|Interest rate and currency derivatives used to hedge debt |  |                   | (194  | ) |                   |  | 2      |                   |  |  | (192        | ) |  |         | (53   | ) |       |  | 61     |             |  |  | 8       |   |  |       | 19    |  |  |  | 3      |   |  |  | 22     |  
|Credit facility drawdowns                                 |  |                   |      |   |                   |  |       |                   |  |  |            |   |  |         |      |   |       |  |       |             |  |  |        |   |  |       | 1,000 |  |  |  | 34     |   |  |  | 1,034  |  
|Total debt                                                |  |                   | 6,489 |   |                   |  | 1,567  |                   |  |  | 8,056       |   |  |         | 5,890 |   |       |  | 2,914  |             |  |  | 8,804   |   |  |       | 4,142 |  |  |  | 1,818  |   |  |  | 5,960  |  
|Cash and cash equivalents                                 |  |                   |      |   |                   |  | (6,465 | )                 |  |  | (6,465      | ) |  |         |      |   |       |  | (4,692 | )           |  |  | (4,692  | ) |  |       |      |  |  |  | (4,226 | ) |  |  | (4 226 | )
|Debt, net of cash and
cash equivalents                    |  |                   | 6,489 |   |                   |  | (4,898 | )                 |  |  | 1,591       |   |  |         | 5,890 |   |       |  | (1,778 | )           |  |  | 4,112   |   |  |       | 4,142 |  |  |  | (2,408 | ) |  |  | 1,734  |  



Bond issues made under the EMTN (Euro Medium Term Notes) program comprise:



| |  |  | June 2008 issue of ¥15 billion (138 million), maturing June 2013, bearing interest at a floating rate indexed to 3-month JPY Libor, and
swapped into euros at a floating rate indexed to 3-month Euribor;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | May 2009 issue [ISIN: XS0428037666] of 1.5 billion, maturing May 2013, bearing annual interest at 3.5%;
| | - |  | --------------------------------------------------------------------------------------------------------



| |  |  | May 2009 issue [ISIN: XS0428037740] of 1.5 billion, maturing May 2016, bearing annual interest at 4.5%;
| | - |  | --------------------------------------------------------------------------------------------------------



| |  |  | October 2009 issue [ISIN: XS0456451938] of 1.2 billion (including supplementary tranche issued in April 2010), maturing October 2014, bearing
annual interest at 3.125%;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | October 2009 issue [ISIN: XS0456451771] of 800 million, maturing October 2019, bearing annual interest at 4.125%.
| | - |  | ------------------------------------------------------------------------------------------------------------------



Bond issues made outside the EMTN (Euro
Medium Term Notes) program comprise:



| |  |  | December 2007 and February 2008 issues [ISIN: CH0035703070] of CHF400 million (320 million), maturing December 2015, bearing annual interest at
3.375%, and swapped into euros at a fixed rate of 4.867%;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | December 2008 and January 2009 issues [ISIN: CH0048787532] amounting to CHF525 million (420 million), maturing December 2012, bearing annual
interest at 3.26%, and swapped into euros as follows: CHF275 million at a fixed rate of 4.894%, and CHF250 million at a floating rate indexed to 3-month Euribor.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The line Other borrowings mainly includes:



| |  |  | Participating shares issued between 1983 and 1987, of which 96,983 remain outstanding, valued at 14.8 million. These 96,983 participating shares
include 3,080 1983 participating shares repurchased by sanofi-aventis in 2010, which will be cancelled in 2011.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Series A participating shares issued in 1989, of which 3,271 remain outstanding, valued at 0.2 million.
| | - |  | --------------------------------------------------------------------------------------------------------



F-66



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Sanofi-aventis has put in place the following arrangements to manage its liquidity
needs:



| |  |  | A syndicated credit facility of 6 billion, of which 0.2 billion expires on March 31, 2011 and 5.8 billion expires on
March 31, 2012, and which may be drawn down in euros or U.S. dollars.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | A syndicated credit facility of 7 billion expiring on July 6, 2015, which may also be drawn down in euros or U.S. dollars.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------



These confirmed facilities are
used in particular to back two commercial paper programs, of 6 billion in France and $6 billion in the United States. In 2010, the average drawdown under these programs was 0.9 billion (maximum 1.7 billion). A total of 0.7
billion was drawn down under these facilities as of December 31, 2010.



Apart from the Genzyme acquisition financing (see below), the financing in place at December 31, 2010 at the level of the sanofi-aventis parent company (which manages the bulk of the Groups
financing needs centrally) is not subject to covenants regarding financial ratios, and contains no clauses linking credit spreads or fees to the credit rating of sanofi-aventis.



In connection with the launch of a public tender offer for
Genzyme, sanofi-aventis contracted on October 2, 2010 two credit facilities totaling $15 billion, which may be drawn down in U.S. dollars up to and including July 2, 2011:



| |  |  | Facility A is a $10 billion facility expiring April 2, 2012, with an optional six-month extension.
| | - |  | --------------------------------------------------------------------------------------------------



| |  |  | Facility B is a $5 billion amortizable facility expiring April 2, 2014.
| | - |  | -----------------------------------------------------------------------



These acquisition facilities are not subject to any financial covenants. The margin of Facility B will depend
on the long-term credit rating of sanofi-aventis, subsequent to the acquisition.



c) Debt by maturity, at value on redemption



|                                                          |  |       |        |   |         |  |        |             |  |  |      |   |  |      |       |   |      |  |       |                |  |  |     |   |  |  |       | 
|--------------------------------------------------------- |  | ----- | ------ | - | ------- |  | ------ | ----------- |  |  | ---- | - |  | ---- | ----- | - | ---- |  | ----- | -------------- |  |  | --- | - |  |  | ----- | 
|                                                          |  |       |        |   | Current |  |        | Non-current | 
|December 31, 2010 ( million)                             |  | Total |        |   | 2011    |  |        | 2012        |  |  | 2013 |   |  | 2014 |       |   | 2015 |  |       | 2016
and later | 
|Bond issues                                               |  |       | 5,971  |   |         |  | 92     |             |  |  | 420  |   |  |      | 1,638 |   |      |  | 1,200 |                |  |  | 321 |   |  |  | 2,300 | 
|Other bank borrowings                                     |  |       | 1,173  |   |         |  | 402    |             |  |  | 203  |   |  |      | 555   |   |      |  | 6     |                |  |  | 7   |   |  |  |      | 
|Commercial paper(1)                                       |  |       | 735    |   |         |  | 735    |             |  |  |     |   |  |      |      |   |      |  |      |                |  |  |    |   |  |  |      | 
|Finance lease obligations                                 |  |       | 25     |   |         |  | 6      |             |  |  | 6    |   |  |      | 5     |   |      |  | 3     |                |  |  | 3   |   |  |  | 2     | 
|Other borrowings                                          |  |       | 71     |   |         |  | 57     |             |  |  |     |   |  |      |      |   |      |  |      |                |  |  |    |   |  |  | 14    | 
|Bank credit balances                                      |  |       | 273    |   |         |  | 273    |             |  |  |     |   |  |      |      |   |      |  |      |                |  |  |    |   |  |  |      | 
|Interest rate and currency derivatives used to hedge debt |  |       | (192   | ) |         |  | 2      |             |  |  | (73  | ) |  |      | (46   | ) |      |  |      |                |  |  | (75 | ) |  |  |      | 
|Total debt                                                |  |       | 8,056  |   |         |  | 1,567  |             |  |  | 556  |   |  |      | 2,152 |   |      |  | 1,209 |                |  |  | 256 |   |  |  | 2,316 | 
|Cash and cash equivalents                                 |  |       | (6,465 | ) |         |  | (6,465 | )           |  |  |     |   |  |      |      |   |      |  |      |                |  |  |    |   |  |  |      | 
|Debt, net of cash and cash equivalents                    |  |       | 1,591  |   |         |  | (4,898 | )           |  |  | 556  |   |  |      | 2,152 |   |      |  | 1,209 |                |  |  | 256 |   |  |  | 2,316 | 



|(1) | Commercial paper had a maturity of no more than six months as of
December 31, 2010.
|--- | -----------------------------------------------------------------------------------



F-67



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



|                                                          |  |       |        |   |         |  |        |             |  |  |      |  |  |      |     |   |      |  |       |               |  |  |     |  |  |  |       |  
|--------------------------------------------------------- |  | ----- | ------ | - | ------- |  | ------ | ----------- |  |  | ---- |  |  | ---- | --- | - | ---- |  | ----- | ------------- |  |  | --- |  |  |  | ----- | -
|                                                          |  |       |        |   | Current |  |        | Non-current | 
|December 31, 2009 ( million)                             |  | Total |        |   | 2010    |  |        | 2011        |  |  | 2012 |  |  | 2013 |     |   | 2014 |  |       | 2015and later | 
|Bond issues                                               |  |       | 7,218  |   |         |  | 1,982  |             |  |  |     |  |  |      | 354 |   |      |  | 1,613 |               |  |  | 700 |  |  |  | 2,569 |  
|Other bank borrowings                                     |  |       | 1,207  |   |         |  | 529    |             |  |  | 11   |  |  |      | 225 |   |      |  | 433   |               |  |  | 7   |  |  |  | 2     |  
|Commercial paper                                          |  |       |       |   |         |  |       |             |  |  |     |  |  |      |    |   |      |  |      |               |  |  |    |  |  |  |      |  
|Finance lease obligations                                 |  |       | 24     |   |         |  | 9      |             |  |  | 3    |  |  |      | 3   |   |      |  | 3     |               |  |  | 3   |  |  |  | 3     |  
|Other borrowings                                          |  |       | 30     |   |         |  | 16     |             |  |  |     |  |  |      |    |   |      |  |      |               |  |  |    |  |  |  | 14    |  
|Bank credit balances                                      |  |       | 317    |   |         |  | 317    |             |  |  |     |  |  |      |    |   |      |  |      |               |  |  |    |  |  |  |      |  
|Interest rate and currency derivatives used to hedge debt |  |       | 8      |   |         |  | 61     |             |  |  |     |  |  |      | (7  | ) |      |  | (20   | )             |  |  |    |  |  |  | (26   | )
|Total debt                                                |  |       | 8,804  |   |         |  | 2,914  |             |  |  | 14   |  |  |      | 575 |   |      |  | 2,029 |               |  |  | 710 |  |  |  | 2,562 |  
|Cash and cash equivalents                                 |  |       | (4,692 | ) |         |  | (4,692 | )           |  |  |     |  |  |      |    |   |      |  |      |               |  |  |    |  |  |  |      |  
|Debt, net of cash and cash equivalents                    |  |       | 4,112  |   |         |  | (1,778 | )           |  |  | 14   |  |  |      | 575 |   |      |  | 2,029 |               |  |  | 710 |  |  |  | 2,562 |  



|                                                          |  |       |        |   |         |  |        |             |  |  |       |  |  |      |    |  |      |  |       |                |  |  |     |   |  |  |     |  
|--------------------------------------------------------- |  | ----- | ------ | - | ------- |  | ------ | ----------- |  |  | ----- |  |  | ---- | -- |  | ---- |  | ----- | -------------- |  |  | --- | - |  |  | --- | -
|                                                          |  |       |        |   | Current |  |        | Non-current | 
|December 31, 2008 ( million)                             |  | Total |        |   | 2009    |  |        | 2010        |  |  | 2011  |  |  | 2012 |    |  | 2013 |  |       | 2014
and later | 
|Bond issues                                               |  |       | 2,906  |   |         |  | 488    |             |  |  | 1,845 |  |  |      |   |  |      |  | 185   |                |  |  | 119 |   |  |  | 269 |  
|Credit facility drawdowns(1)                              |  |       | 1,034  |   |         |  | 34     |             |  |  |      |  |  |      |   |  |      |  | 1,000 |                |  |  |    |   |  |  |    |  
|Other bank borrowings                                     |  |       | 932    |   |         |  | 262    |             |  |  | 13    |  |  |      | 7  |  |      |  | 208   |                |  |  | 439 |   |  |  | 3   |  
|Commercial paper(2)                                       |  |       | 717    |   |         |  | 717    |             |  |  |      |  |  |      |   |  |      |  |      |                |  |  |    |   |  |  |    |  
|Finance lease obligations                                 |  |       | 25     |   |         |  | 4      |             |  |  | 3     |  |  |      | 6  |  |      |  | 2     |                |  |  | 3   |   |  |  | 7   |  
|Other borrowings                                          |  |       | 25     |   |         |  | 11     |             |  |  |      |  |  |      |   |  |      |  |      |                |  |  |    |   |  |  | 14  |  
|Bank credit balances                                      |  |       | 299    |   |         |  | 299    |             |  |  |      |  |  |      |   |  |      |  |      |                |  |  |    |   |  |  |    |  
|Interest rate and currency derivatives used to hedge debt |  |       | 22     |   |         |  | 3      |             |  |  | 76    |  |  |      |   |  |      |  | (5    | )              |  |  | (27 | ) |  |  | (25 | )
|Total debt                                                |  |       | 5,960  |   |         |  | 1,818  |             |  |  | 1,937 |  |  |      | 13 |  |      |  | 1,390 |                |  |  | 534 |   |  |  | 268 |  
|Cash and cash equivalents                                 |  |       | (4,226 | ) |         |  | (4,226 | )           |  |  |      |  |  |      |   |  |      |  |      |                |  |  |    |   |  |  |    |  
|Debt, net of cash and cash equivalents                    |  |       | 1,734  |   |         |  | (2,408 | )           |  |  | 1,937 |  |  |      | 13 |  |      |  | 1,390 |                |  |  | 534 |   |  |  | 268 |  



|(1) | Maturities used for credit facility drawdowns are those of the facility, not the
drawdown.
|--- | ------------------------------------------------------------------------------------------

|(2) | Commercial paper had a maturity of no more than three months as of
December 31, 2008.
|--- | -------------------------------------------------------------------------------------



The main undrawn confirmed general-purpose credit facilities (excluding the Genzyme acquisition facilities) not allocated to outstanding commercial paper drawdowns at December 31, 2010 break down as
follows:



|               |  |                                                         |        | 
|-------------- |  | ------------------------------------------------------- | ------ | 
|Year of expiry |  | Undrawn confirmedcredit facilities available( million) |       
|2011           |  |                                                         | 245    | 
|2012           |  |                                                         | 5,755  | 
|2015           |  |                                                         | 6,238  | 
|Total          |  |                                                         | 12,238 | 



F-68



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



These confirmed credit facilities comprise:



| |  |  | a syndicated credit facility of 6 billion expiring in 2011 (0.2 billion) and in 2012 (5.8 billion);
| | - |  | ------------------------------------------------------------------------------------------------------



| |  |  | a syndicated credit facility of 7 billion expiring in 2015.
| | - |  | ------------------------------------------------------------



As of December 31, 2010, no single counterparty represented more than 10% of undrawn confirmed credit
facilities.



d) Debt by interest rate type, at value on
redemption



The tables below split debt, net
of cash and cash equivalents between fixed and floating rate, and by maturity or contractual repricing date, at December 31, 2010. The figures shown are the value on redemption, before the effects of derivative instruments:



|                                                                  |  |                   |        |   |      |  |        |      |  |  |      |  |  |      |       |  |      |  |       |               |  |  |     |  |  |  |       | 
|----------------------------------------------------------------- |  | ----------------- | ------ | - | ---- |  | ------ | ---- |  |  | ---- |  |  | ---- | ----- |  | ---- |  | ----- | ------------- |  |  | --- |  |  |  | ----- | 
|                                                                  |  | December 31, 2010 |       
|( million)                                                       |  | Total             |        |   | 2011 |  |        | 2012 |  |  | 2013 |  |  | 2014 |       |  | 2015 |  |       | 2016and later | 
|Fixed-rate debt                                                   |  |                   | 6,050  |   |      |  |       |      |  |  | 547  |  |  |      | 1,758 |  |      |  | 1,200 |               |  |  | 245 |  |  |  | 2,300 | 
|% fixed-rate                                                      |  |                   | 75%    |   |      |  |        |      |  |  |      |  |  |      |       |  |      |  |       |               |  |  |     |  |  |  |       | 
|Floating-rate debt (maturity based on contractual repricing date) |  |                   | 2,006  |   |      |  | 2,006  |      |  |  |     |  |  |      |      |  |      |  |      |               |  |  |    |  |  |  |      | 
|% floating-rate                                                   |  |                   | 25%    |   |      |  |        |      |  |  |      |  |  |      |       |  |      |  |       |               |  |  |     |  |  |  |       | 
|Total debt                                                        |  |                   | 8,056  |   |      |  | 2,006  |      |  |  | 547  |  |  |      | 1,758 |  |      |  | 1,200 |               |  |  | 245 |  |  |  | 2,300 | 
|Cash and cash equivalents                                         |  |                   | (6 465 | ) |      |  | (6,465 | )    |  |  |     |  |  |      |      |  |      |  |      |               |  |  |    |  |  |  |      | 
|% floating-rate                                                   |  |                   | 100%   |   |      |  |        |      |  |  |      |  |  |      |       |  |      |  |       |               |  |  |     |  |  |  |       | 
|Debt, net of cash and cash equivalents                            |  |                   | 1,591  |   |      |  | (4,459 | )    |  |  | 547  |  |  |      | 1,758 |  |      |  | 1,200 |               |  |  | 245 |  |  |  | 2,300 | 



Floating-rate interest on debt is usually indexed to the euro zone interbank offered rate (Euribor). Floating-rate interest on cash and
cash equivalents is usually indexed to the Eonia rate.



In order to reduce the amount and/or volatility of the cost of debt, sanofi-aventis has contracted derivative instruments (swaps, and in some cases caps or combinations of purchases of caps and sales of
floors). This has the effect of altering the fixed/floating split and the maturity based on contractual repricing dates:



|                                       |  |                   |        |   |      |  |        |      |  |  |      |  |  |      |       |  |      |  |       |               |  |  |     |  |  |  |       | 
|-------------------------------------- |  | ----------------- | ------ | - | ---- |  | ------ | ---- |  |  | ---- |  |  | ---- | ----- |  | ---- |  | ----- | ------------- |  |  | --- |  |  |  | ----- | 
|                                       |  | December 31, 2010 |       
|( million)                            |  | Total             |        |   | 2011 |  |        | 2012 |  |  | 2013 |  |  | 2014 |       |  | 2015 |  |       | 2016and later | 
|Fixed-rate debt                        |  |                   | 5,350  |   |      |  |       |      |  |  | 347  |  |  |      | 1,758 |  |      |  | 1,200 |               |  |  | 245 |  |  |  | 1,800 | 
|% fixed-rate                           |  |                   | 66%    |   |      |  |        |      |  |  |      |  |  |      |       |  |      |  |       |               |  |  |     |  |  |  |       | 
|Floating-rate debt                     |  |                   | 2,706  |   |      |  | 2,706  |      |  |  |     |  |  |      |      |  |      |  |      |               |  |  |    |  |  |  |      | 
|% floating-rate                        |  |                   | 34%    |   |      |  |        |      |  |  |      |  |  |      |       |  |      |  |       |               |  |  |     |  |  |  |       | 
|Total debt                             |  |                   | 8,056  |   |      |  | 2,706  |      |  |  | 347  |  |  |      | 1,758 |  |      |  | 1,200 |               |  |  | 245 |  |  |  | 1,800 | 
|Cash and cash equivalents              |  |                   | (6,465 | ) |      |  | (6,465 | )    |  |  |     |  |  |      |      |  |      |  |      |               |  |  |    |  |  |  |      | 
|% floating-rate                        |  |                   | 100%   |   |      |  |        |      |  |  |      |  |  |      |       |  |      |  |       |               |  |  |     |  |  |  |       | 
|Debt, net of cash and cash equivalents |  |                   | 1,591  |   |      |  | (3,759 | )    |  |  | 347  |  |  |      | 1,758 |  |      |  | 1,200 |               |  |  | 245 |  |  |  | 1,800 | 



F-69



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The table below shows the fixed/floating rate split at redemption value after taking
account of derivative instruments as of December 31, 2009 and 2008:



|                                       |  |      |        |   |   |  |      |      |  |  |        |   |  |  |      | 
|-------------------------------------- |  | ---- | ------ | - | - |  | ---- | ---- |  |  | ------ | - |  |  | ---- | 
|( million)                            |  | 2009 |        |   | % |  |      | 2008 |  |  | %      |  
|Fixed-rate debt                        |  |      | 5,940  |   |   |  | 67%  |      |  |  | 3,421  |   |  |  | 57%  | 
|Floating-rate debt                     |  |      | 2,864  |   |   |  | 33%  |      |  |  | 2,539  |   |  |  | 43%  | 
|Total debt                             |  |      | 8,804  |   |   |  | 100% |      |  |  | 5,960  |   |  |  | 100% | 
|Cash and cash equivalents              |  |      | (4,692 | ) |   |  |      |      |  |  | (4,226 | ) |  |  |      | 
|Debt, net of cash and cash equivalents |  |      | 4,112  |   |   |  |      |      |  |  | 1,734  |   |  |  |      | 



The weighted average interest rate on debt at December 31, 2010 was 3.6% both before and after derivative instruments. All cash and cash equivalents were invested at an average rate of 1.1% at
December 31, 2010.



Based on the Groups
level of debt, and taking account of derivative instruments in place at December 31, 2010, sensitivity to movements in market interest rates over a full year would be as follows in the year ending December 31, 2011:



|                                                    |  |                                        |  |  |                                                                               |   |  |  |     |  
|--------------------------------------------------- |  | -------------------------------------- |  |  | ----------------------------------------------------------------------------- | - |  |  | --- | -
|Change in 3-month Euribor interest rate assumptions |  | Impact on pre-taxnet income( million) |  |  | Impact on income/(expense)recognized directly inequity, before
tax( million) |  
|+ 100 bp                                            |  |                                        |  |  | 41                                                                            |   |  |  | 13  |  
|+ 25 bp                                             |  |                                        |  |  | 10                                                                            |   |  |  | 1   |  
|- 25 bp                                             |  |                                        |  |  | (10                                                                           | ) |  |  | (6  | )
|- 100 bp                                            |  |                                        |  |  | (41                                                                           | ) |  |  | (18 | )



e) Debt, net of cash and cash equivalents by currency, at value on redemption



The table below shows debt, net of cash and cash equivalents
by currency at December 31, 2010, before and after taking account of derivative instruments contracted to convert third-party debt into the functional currency of the borrower entity:



|                                       |  |                              |       |   |                             |  |       |  
|-------------------------------------- |  | ---------------------------- | ----- | - | --------------------------- |  | ----- | -
|                                       |  | December 31, 2010            |      
|( million)                            |  | Before derivativeinstruments |       |   | After derivativeinstruments | 
|EUR                                    |  |                              | 703   |   |                             |  | 1,581 |  
|USD                                    |  |                              | 37    |   |                             |  | 37    |  
|JPY                                    |  |                              | 141   |   |                             |  | 3     |  
|CHF                                    |  |                              | 738   |   |                             |  | (2    | )
|GBP                                    |  |                              | (65   | ) |                             |  | (65   | )
|Other currencies                       |  |                              | 37    |   |                             |  | 37    |  
|Debt, net of cash and cash equivalents |  |                              | 1,591 |   |                             |  | 1,591 |  



F-70



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The table below shows debt, net of cash and cash equivalents by currency at
December 31, 2009 and 2008, after taking account of derivative instruments contracted to convert third-party debt into the functional currency of the borrower entity:



|                                       |  |      |       |   |      |  |       |  
|-------------------------------------- |  | ---- | ----- | - | ---- |  | ----- | -
|( million)                            |  | 2009 |       |   | 2008 | 
|EUR                                    |  |      | 4,312 |   |      |  | 1,625 |  
|USD                                    |  |      | (22   | ) |      |  | (19   | )
|GBP                                    |  |      | (58   | ) |      |  | (64   | )
|Other currencies                       |  |      | (120  | ) |      |  | 192   |  
|Debt, net of cash and cash equivalents |  |      | 4,112 |   |      |  | 1,734 |  



f) Market value of debt, net of cash and cash equivalents



The market value of debt, net of cash and cash equivalents at December 31, 2010 was 1,887 million (December 31, 2009:
4,349 million; December 31, 2008: 1,801 million), versus a value on redemption of 1,591 million (December 31, 2009: 4,112 million; December 31, 2008: 1,734 million).



g) Future contractual cash flows relating to debt and debt hedging
instruments



The table below shows the amount
of future contractual undiscounted cash flows (principal and interest) relating to debt and to derivative instruments designated as hedges of debt as at December 31, 2010:



|                                                 |  |                                    |       |   |      |  |       |      |  |  |      |   |  |      |       |   |      |  |       |                |  |  |     |   |  |  |       |  
|------------------------------------------------ |  | ---------------------------------- | ----- | - | ---- |  | ----- | ---- |  |  | ---- | - |  | ---- | ----- | - | ---- |  | ----- | -------------- |  |  | --- | - |  |  | ----- | -
|                                                 |  | December 31, 2010                  |      
|                                                 |  | Contractual cash flows by maturity |      
|( million)                                      |  | Total                              |       |   | 2011 |  |       | 2012 |  |  | 2013 |   |  | 2014 |       |   | 2015 |  |       | 2016
and later | 
|Debt                                             |  |                                    | 9,354 |   |      |  | 1,699 |      |  |  | 875  |   |  |      | 2,418 |   |      |  | 1,360 |                |  |  | 462 |   |  |  | 2,540 |  
| principal                                      |  |                                    | 8,150 |   |      |  | 1,447 |      |  |  | 632  |   |  |      | 2,200 |   |      |  | 1,208 |                |  |  | 347 |   |  |  | 2,316 |  
| interest(1)                                    |  |                                    | 1,204 |   |      |  | 252   |      |  |  | 243  |   |  |      | 218   |   |      |  | 152   |                |  |  | 115 |   |  |  | 224   |  
|Net cash flows related to derivative instruments |  |                                    | (229  | ) |      |  | (5    | )    |  |  | (83  | ) |  |      | (49   | ) |      |  | 3     |                |  |  | (89 | ) |  |  | (6    | )
|Total                                            |  |                                    | 9,125 |   |      |  | 1,694 |      |  |  | 792  |   |  |      | 2,369 |   |      |  | 1,363 |                |  |  | 373 |   |  |  | 2,534 |  



|(1) | Interest cash flows are estimated on the basis of forward interest rates
applicable as of December 31, 2010.
|--- | ------------------------------------------------------------------------------------------------------------



Future contractual cash flows are shown on the basis of the carrying amount in the balance sheet at the reporting date, without reference to any subsequent management decision that might materially alter
the structure of the Groups debt or its hedging policy.



Maturities used for credit facility drawdowns are those of the facility, not the drawdown.



The table below shows the amount of future contractual undiscounted cash flows (principal and interest) relating to debt and to derivative
instruments designated as hedges of debt as at December 31, 2009 and 2008:



|                                                 |  |                                    |        |   |      |  |       |      |  |  |      |  |  |      |     |   |      |  |       |                |  |  |     |  |  |  |       |  
|------------------------------------------------ |  | ---------------------------------- | ------ | - | ---- |  | ----- | ---- |  |  | ---- |  |  | ---- | --- | - | ---- |  | ----- | -------------- |  |  | --- |  |  |  | ----- | -
|                                                 |  | December 31, 2009                  |       
|                                                 |  | Contractual cash flows by maturity |       
|( million)                                      |  | Total                              |        |   | 2010 |  |       | 2011 |  |  | 2012 |  |  | 2013 |     |   | 2014 |  |       | 2015
and later | 
|Debt                                             |  |                                    | 10,118 |   |      |  | 3,049 |      |  |  | 231  |  |  |      | 797 |   |      |  | 2,254 |                |  |  | 844 |  |  |  | 2,943 |  
| principal                                      |  |                                    | 8,681  |   |      |  | 2,737 |      |  |  | 6    |  |  |      | 570 |   |      |  | 2,052 |                |  |  | 709 |  |  |  | 2,607 |  
| interest(1)                                    |  |                                    | 1,437  |   |      |  | 312   |      |  |  | 225  |  |  |      | 227 |   |      |  | 202   |                |  |  | 135 |  |  |  | 336   |  
|Net cash flows related to derivative instruments |  |                                    | (14    | ) |      |  | 51    |      |  |  | 8    |  |  |      | (9  | ) |      |  | (24   | )              |  |  | 2   |  |  |  | (42   | )
|Total                                            |  |                                    | 10,104 |   |      |  | 3,100 |      |  |  | 239  |  |  |      | 788 |   |      |  | 2,230 |                |  |  | 846 |  |  |  | 2,901 |  



|(1) | Interest cash flows are estimated on the basis of forward interest rates
applicable as of December 31, 2009.
|--- | ------------------------------------------------------------------------------------------------------------



F-71



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



|                                                 |  |                                    |       |  |      |  |       |      |  |  |       |  |  |      |    |  |      |  |       |                |  |  |     |   |  |  |     |  
|------------------------------------------------ |  | ---------------------------------- | ----- |  | ---- |  | ----- | ---- |  |  | ----- |  |  | ---- | -- |  | ---- |  | ----- | -------------- |  |  | --- | - |  |  | --- | -
|                                                 |  | December 31, 2008                  |      
|                                                 |  | Contractual cash flows by maturity |      
|( million)                                      |  | Total                              |       |  | 2009 |  |       | 2010 |  |  | 2011  |  |  | 2012 |    |  | 2013 |  |       | 2014
and later | 
|Debt                                             |  |                                    | 6,468 |  |      |  | 1,957 |      |  |  | 2,004 |  |  |      | 88 |  |      |  | 1,470 |                |  |  | 591 |   |  |  | 358 |  
| principal                                      |  |                                    | 5,921 |  |      |  | 1,784 |      |  |  | 1,851 |  |  |      | 6  |  |      |  | 1,407 |                |  |  | 562 |   |  |  | 311 |  
| interest(1)                                    |  |                                    | 547   |  |      |  | 173   |      |  |  | 153   |  |  |      | 82 |  |      |  | 63    |                |  |  | 29  |   |  |  | 47  |  
|Net cash flows related to derivative instruments |  |                                    | 16    |  |      |  | 17    |      |  |  | 77    |  |  |      | 7  |  |      |  | (9    | )              |  |  | (35 | ) |  |  | (41 | )
|Total                                            |  |                                    | 6,484 |  |      |  | 1,974 |      |  |  | 2,081 |  |  |      | 95 |  |      |  | 1,461 |                |  |  | 556 |   |  |  | 317 |  



|(1) | Interest cash flows are estimated on the basis of forward interest rates
applicable as of December 31, 2008.
|--- | ------------------------------------------------------------------------------------------------------------



D.18. Liabilities related to business combinations and non-controlling interests



For a description of the liabilities reported in the line item Liabilities related to business combinations and to non-controlling
interests, refer to Note B.8.5. The principal acquisitions are described in Note D.1.



Obligations relating to business combinations mainly comprise contingent consideration in the form of milestone payments payable to the vendor and linked to development on projects conducted by the
acquiree. The accounting treatment of contingent consideration is described in Note B.3.1. With effect from January 1, 2010, the fair value of contingent consideration in respect of products under development factors in (i) the probability
that the project will succeed and (ii) the time value of money.



Movements in liabilities related to business combinations and to non-controlling interests were as follows:



|                                                           |  |                            |     |   |                            |  |     |  
|---------------------------------------------------------- |  | -------------------------- | --- | - | -------------------------- |  | --- | -
|( million)                                                |  | Year endedDecember 31,2010 |     |   | Year endedDecember 31,2009 | 
|Balance, beginning of period                               |  |                            | 151 |   |                            |  |    |  
|split as follows:                                          |  |                            |     |   |                            |  |     |  
| non-current                                              |  |                            | 75  |   |                            |  |    |  
| current                                                  |  |                            | 76  |   |                            |  |    |  
|New business combinations                                  |  |                            | 219 |   |                            |  | 153 |  
|Payments made                                              |  |                            | (52 | ) |                            |  |    |  
|Fair value remeasurement (including unwinding of discount) |  |                            | 5   |   |                            |  | 2   |  
|Other movements(1)                                         |  |                            | 155 |   |                            |  |     |  
|Translation differences                                    |  |                            | 8   |   |                            |  | (4  | )
|Balance, end of period                                     |  |                            | 486 |   |                            |  | 151 |  
|split as follows:                                          |  |                            |     |   |                            |  |     |  
| non-current                                              |  |                            | 388 |   |                            |  | 75  |  
| current                                                  |  |                            | 98  |   |                            |  | 76  |  



|(1) | Contingent consideration on the acquisition of Fovea, payment of which was
regarded as probable in 2010.
|--- | --------------------------------------------------------------------------------------------------------



The balance of these liabilities at the end of each period breaks down as follows:



|                                                 |  |                  |     |  |                  |  |     | 
|------------------------------------------------ |  | ---------------- | --- |  | ---------------- |  | --- | 
|( million)                                      |  | December 31,2010 |     |  | December 31,2009 | 
|Put options granted to non-controlling interests |  |                  | 134 |  |                  |  |    | 
|Liabilities related to business combinations     |  |                  | 352 |  |                  |  | 151 | 
|Balance, end of period                           |  |                  | 486 |  |                  |  | 151 | 



F-72



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The put options reported above were granted to non-controlling interests in connection
with acquisitions completed during 2010, and relate to sanofi-aventis Vostok and Hangzhou Sanofi Minsheng Consumer Healthcare Co. Ltd (see Note D.1.).



Liabilities related to business combinations as of December 31, 2010 mainly comprise contingent consideration related to the
acquisitions of TargeGen (94 million), Fovea (155 million), and BiPar (70 million).



The table below sets forth the maximum amount of contingent consideration payable:



|                                             |  |                        |     |  |                 |  |    |                  |  |  |                  |  |  |                  |     |  |  |  |     | 
|-------------------------------------------- |  | ---------------------- | --- |  | --------------- |  | -- | ---------------- |  |  | ---------------- |  |  | ---------------- | --- |  |  |  | --- | 
|                                             |  | December 31, 2010      |    
|                                             |  | Payments due by period |    
|( million)                                  |  | Total                  |     |  | Less than1 year |  |    | From 1 to 3years |  |  | From 3 to 5years |  |  | More than5 years |    
|Obligations related to business combinations |  |                        | 739 |  |                 |  | 87 |                  |  |  | 79               |  |  |                  | 438 |  |  |  | 135 | 



F-73



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



D.19. Provisions and other liabilities



Provisions and other non-current liabilities break down as follows:



|                                                   |  |                                                             |       |   |                                  |  |       |                          |  |  |                             |      |  |       |     |   |  |  |        |  
|-------------------------------------------------- |  | ----------------------------------------------------------- | ----- | - | -------------------------------- |  | ----- | ------------------------ |  |  | --------------------------- | ---- |  | ----- | --- | - |  |  | ------ | -
|( million)                                        |  | Provisions forpensions andother long-termbenefits (D.19.1.) |       |   | Restructuringprovisions(D.19.2.) |  |       | Otherprovisions(D.19.3.) |  |  | Othernon-currentliabilities |      |  | Total |    
|January 1, 2008                                    |  |                                                             | 3,398 |   |                                  |  | 188   |                          |  |  | 3,126                       |      |  |       | 145 |   |  |  | 6,857  |  
|Changes in scope of consolidation                  |  |                                                             |      |   |                                  |  |      |                          |  |  | 33                          |      |  |       |    |   |  |  | 33     |  
|Increases in provisions and other liabilities      |  |                                                             | 334   |   |                                  |  | 290   |                          |  |  | 828                         | (2)  |  |       |    |   |  |  | 1,452  |  
|Provisions utilized                                |  |                                                             | (365  | ) |                                  |  | (33   | )                        |  |  | (223                        | )    |  |       | (3  | ) |  |  | (624   | )
|Reversals of unutilized provisions                 |  |                                                             | (65   | ) |                                  |  |      |                          |  |  | (531                        | )(3) |  |       |    |   |  |  | (596   | )
|Transfers(1)                                       |  |                                                             | 1     |   |                                  |  | (84   | )                        |  |  | (176                        | )    |  |       | 51  |   |  |  | (208   | )
|Unwinding of discount                              |  |                                                             |      |   |                                  |  | 5     |                          |  |  | 31                          |      |  |       | 1   |   |  |  | 37     |  
|Unrealized gains and losses                        |  |                                                             |      |   |                                  |  |      |                          |  |  |                            |      |  |       | 14  |   |  |  | 14     |  
|Translation differences                            |  |                                                             | (59   | ) |                                  |  |      |                          |  |  | (4                          | )    |  |       | 4   |   |  |  | (59    | )
|Actuarial gains/losses on defined-benefit plans(4) |  |                                                             | 824   |   |                                  |  |      |                          |  |  |                            |      |  |       |    |   |  |  | 824    |  
|December 31, 2008                                  |  |                                                             | 4,068 |   |                                  |  | 366   |                          |  |  | 3,084                       |      |  |       | 212 |   |  |  | 7,730  |  
|Changes in scope of consolidation                  |  |                                                             | 13    |   |                                  |  |      |                          |  |  | 228                         |      |  |       | 9   |   |  |  | 250    |  
|Increases in provisions and other liabilities      |  |                                                             | 683   |   |                                  |  | 183   |                          |  |  | 1,256                       | (2)  |  |       |    |   |  |  | 2,122  |  
|Provisions utilized                                |  |                                                             | (603  | ) |                                  |  | (61   | )                        |  |  | (251                        | )    |  |       | (10 | ) |  |  | (925   | )
|Reversals of unutilized provisions                 |  |                                                             | (130  | ) |                                  |  | (1    | )                        |  |  | (753                        | )(3) |  |       | (24 | ) |  |  | (908   | )
|Transfers(1)                                       |  |                                                             | 133   |   |                                  |  | (232  | )                        |  |  | (104                        | )    |  |       | (70 | ) |  |  | (273   | )
|Unwinding of discount                              |  |                                                             |      |   |                                  |  | 3     |                          |  |  | 36                          |      |  |       | 1   |   |  |  | 40     |  
|Unrealized gains and losses                        |  |                                                             |      |   |                                  |  |      |                          |  |  |                            |      |  |       | (12 | ) |  |  | (12    | )
|Translation differences                            |  |                                                             | 9     |   |                                  |  | (1    | )                        |  |  | 37                          |      |  |       | (2  | ) |  |  | 43     |  
|Actuarial gains/losses on defined-benefit plans(4) |  |                                                             | 169   |   |                                  |  |      |                          |  |  |                            |      |  |       |    |   |  |  | 169    |  
|December 31, 2009                                  |  |                                                             | 4,342 |   |                                  |  | 257   |                          |  |  | 3,533                       |      |  |       | 104 |   |  |  | 8,236  |  
|Changes in scope of consolidation                  |  |                                                             | 21    |   |                                  |  |      |                          |  |  | 27                          |      |  |       |    |   |  |  | 48     |  
|Increases in provisions and other liabilities      |  |                                                             | 442   |   |                                  |  | 731   |                          |  |  | 857                         | (2)  |  |       | 11  |   |  |  | 2,041  |  
|Provisions utilized                                |  |                                                             | (587  | ) |                                  |  | (65   | )                        |  |  | (386                        | )    |  |       | (41 | ) |  |  | (1,079 | )
|Reversals of unutilized provisions                 |  |                                                             | (82   | ) |                                  |  | (56   | )                        |  |  | (259                        | )(3) |  |       |    |   |  |  | (397   | )
|Transfers(1)                                       |  |                                                             | (305  | ) |                                  |  | 119   |                          |  |  | 81                          |      |  |       | (7  | ) |  |  | (112   | )
|Unwinding of discount                              |  |                                                             |      |   |                                  |  | 27    |                          |  |  | 34                          |      |  |       | 1   |   |  |  | 62     |  
|Unrealized gains and losses                        |  |                                                             |      |   |                                  |  |      |                          |  |  | (35                         | )    |  |       | 33  |   |  |  | (2     | )
|Translation differences                            |  |                                                             | 96    |   |                                  |  | 4     |                          |  |  | 108                         |      |  |       | 5   |   |  |  | 213    |  
|Actuarial gains/losses on defined-benefit plans(4) |  |                                                             | 316   |   |                                  |  |      |                          |  |  |                            |      |  |       |    |   |  |  | 316    |  
|December 31, 2010                                  |  |                                                             | 4,243 |   |                                  |  | 1,017 |                          |  |  | 3,960                       |      |  |       | 106 |   |  |  | 9,326  |  



|(1) | This line includes transfers between current and non-current provisions, and in
2010 the reclassification of social security charges and Fillon levies on early retirement plans in France (see Note D.19.1.).
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Amounts charged during the period mainly comprise provisions to cover tax
exposures in various countries and changes to estimate of future expenditure on environmental risks.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Reversals relate mainly to provisions for tax exposures, reversed either because
(i) the risk exposure became time-barred during the reporting period or (ii) the tax dispute was settled during the period and the outcome proved more favorable than expected for sanofi-aventis.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Amounts recognized directly in equity (see Note D.15.7.).
|--- | ---------------------------------------------------------



Other current
liabilities are described in Note D.19.4.



F-74



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



D.19.1. Provisions for pensions and other benefits



The Group and its subsidiaries have a significant number of
pension plans covering the majority of their employees. The specific features (benefit formulas, funding policies and types of assets held) of the plans vary depending on laws and regulations in the particular country in which the employees work.
Several of these plans are defined-benefit plans and cover some members of the Board of Directors as well as employees.



Actuarial valuations of the Groups benefit obligations were computed by management with assistance from external actuaries as of
December 31, 2010, 2009 and 2008. These calculations incorporate the following elements:



| |  |  | Assumptions on staff turnover and life expectancy, specific to each country.
| | - |  | ----------------------------------------------------------------------------



| |  |  | A retirement age of 60 to 67 for a total working life allowing for full-rate retirement rights for employees of French companies, and retirement
assumptions reflecting local economic and demographic factors specific to employees of foreign companies.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | A salary inflation rate for the principal countries ranging from 3% to 5% at December 31, 2010, 2009, and 2008.
| | - |  | ---------------------------------------------------------------------------------------------------------------



| |  |  | An annuity inflation rate for the principal countries ranging from 2% to 5% at December 31, 2010 and 2009, and from 2% to 3% at December 31,
2008.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | A weighted average long-term healthcare cost inflation rate of 4.51% at December 31, 2010, 4.34% at December 31, 2009, and 4.53% at
December 31, 2008, applied to post-employment benefits.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Inflation rate assumptions, as shown in the table below:
| | - |  | --------------------------------------------------------



|                 |  |      |       |  |      |  |      |      |  |  |      | 
|---------------- |  | ---- | ----- |  | ---- |  | ---- | ---- |  |  | ---- | 
|Inflation rate   |  | 2010 |       |  | 2009 |  |      | 2008 | 
| Euro zone      |  |      | 2%    |  |      |  | 2%   |      |  |  | 2%   | 
| United States  |  |      | 2.75% |  |      |  | 3%   |      |  |  | 3%   | 
| United Kingdom |  |      | 3.25% |  |      |  | 3.1% |      |  |  | 3.1% | 



| |  |  | Discount rates used to determine the present value of defined benefit obligations at the balance sheet date, as shown in the table below:
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------



|                                  |  |                                       |                |     |                               |  |               |      |  |  |             |  |  |      |       |  |      |  |       |  |  |  |       | 
|--------------------------------- |  | ------------------------------------- | -------------- | --- | ----------------------------- |  | ------------- | ---- |  |  | ----------- |  |  | ---- | ----- |  | ---- |  | ----- |  |  |  | ----- | 
|                                  |  | Pensions and other long-term benefits |                |     | Other post-employmentbenefits | 
|                                  |  | Year ended December 31                |                |     | Year ended December 31        | 
|Discount rate                     |  | 2010                                  |                |     | 2009                          |  |               | 2008 |  |  | 2010        |  |  | 2009 |       |  | 2008 | 
|Weighted average for all regions: |  |                                       | 4.97%          |     |                               |  | 5.34%         |      |  |  | 5.98%       |  |  |      | 5.45% |  |      |  | 5.76% |  |  |  | 6.01% | 
| Euro zone                       |  |                                       | 4.25% or 4.75% | (1) |                               |  | 4.5% or 5.25% |      |  |  | 5.75% or 6% |  |  |      | 4.75% |  |      |  | 5.25% |  |  |  | 6%    | 
| United States                   |  |                                       | 5.5%           |     |                               |  | 5.75%         |      |  |  | 6%          |  |  |      | 5.5%  |  |      |  | 5.75% |  |  |  | 6%    | 
| United Kingdom                  |  |                                       | 5.5%           |     |                               |  | 5.75%         |      |  |  | 6.5%        |  |  |      | 5.5%  |  |      |  | 5.75% |  |  |  | 6.5%  | 



|(1) | Depends on the term of the plan: 4.25% medium-term, 4.75% long-term.
|--- | --------------------------------------------------------------------



F-75



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The discount rates used are based on market rates for high quality corporate bonds (AA)
the term of which approximates that of the expected benefit payments of the plans. The principal benchmark indices used are the Iboxx Corporate  index for the euro zone, the Iboxx Corporate £ index for the United Kingdom, and the
Citigroup Pension Liability Index for the United States.



Sensitivity analysis of pension plans and other post-employment benefits in the principal countries shows that a 0.5% reduction in discount rates would increase the Groups obligation by
approximately 560 million, of which approximately 160 million would relate to the United Kingdom, 160 million to Germany, 120 million to France and 120 million to the United States.



| |  |  | Assumptions about the expected long-term rates of return for plan assets. The majority of fund assets are invested in Germany, the United States and
the United Kingdom. The expected long-term rates of return used are as follows:
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|                                                |  |                                       |            |  |                                |  |            |      |  |  |              |  |  |      |      |  |      |  |    |  |  |  |    | 
|----------------------------------------------- |  | ------------------------------------- | ---------- |  | ------------------------------ |  | ---------- | ---- |  |  | ------------ |  |  | ---- | ---- |  | ---- |  | -- |  |  |  | -- | 
|                                                |  | Pensions and other long-term benefits |            |  | Other post-employment benefits | 
|                                                |  | Year ended December 31                |            |  | Year ended December 31         | 
|Expected long-term rate of return onplan assets |  | 2010                                  |            |  | 2009                           |  |            | 2008 |  |  | 2010         |  |  | 2009 |      |  | 2008 | 
|Range of rates of return:                       |  |                                       | 1.7%  14% |  |                                |  | 2%  13.5% |      |  |  | 2.5%  13.5% |  |  |      | 7.5% |  |      |  | 8% |  |  |  | 8% | 
|Weighted average for all regions:               |  |                                       | 6.48%      |  |                                |  | 6.86%      |      |  |  | 6.97%        |  |  |      | 7.5% |  |      |  | 8% |  |  |  | 8% | 
| Germany                                       |  |                                       | 6.25%      |  |                                |  | 6.75%      |      |  |  | 6.75%        |  |  |      |     |  |      |  |   |  |  |  |   | 
| United States                                 |  |                                       | 7.5%       |  |                                |  | 8%         |      |  |  | 8%           |  |  |      | 7.5% |  |      |  | 8% |  |  |  | 8% | 
| United Kingdom                                |  |                                       | 6.25%      |  |                                |  | 6.5%       |      |  |  | 7%           |  |  |      |     |  |      |  |   |  |  |  |   | 



The average long-term rates of return on plan assets were determined on the basis of actual long-term rates of return in the financial
markets. These returns vary according to the asset category (equities, bonds, real estate, other). As a general rule, sanofi-aventis applies the risk premium concept in assessing the return on equities relative to bond yields.



An analysis of the sensitivity of the benefit cost to changes
in the expected long-term rate of return on plan assets shows that a 0.5% reduction in the rate of return would increase the benefit cost by approximately 30 million.



The weighted average allocation of funds invested in Group
pension plans is shown below:



|                            |  |                |      |  |      |  |     |      |  |  |      | 
|--------------------------- |  | -------------- | ---- |  | ---- |  | --- | ---- |  |  | ---- | 
|                            |  | Funds invested |     
|Asset category (percentage) |  | 2010           |      |  | 2009 |  |     | 2008 | 
|Equities                    |  |                | 50%  |  |      |  | 51  | %    |  |  | 46%  | 
|Bonds                       |  |                | 47%  |  |      |  | 46  | %    |  |  | 49%  | 
|Real estate                 |  |                | 2%   |  |      |  | 1   | %    |  |  | 2%   | 
|Cash                        |  |                | 1%   |  |      |  | 2   | %    |  |  | 3%   | 
|Total                       |  |                | 100% |  |      |  | 100 | %    |  |  | 100% | 



The target allocation of funds invested as of December 31, 2010 is not materially different from the actual allocation as of
December 31, 2009 and December 31, 2008.



F-76



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The table below reconciles the net obligation in respect of the Groups pension
plans and other employee benefits with the amounts recognized in the consolidated financial statements:



|                                                             |  |                                      |       |      |                                                  |  |       |      |  |  |        |   |  |      |     |   |      |  |     |   |  |  |     |  
|------------------------------------------------------------ |  | ------------------------------------ | ----- | ---- | ------------------------------------------------ |  | ----- | ---- |  |  | ------ | - |  | ---- | --- | - | ---- |  | --- | - |  |  | --- | -
|                                                             |  | Pensions and otherlong-term benefits |       |      | Other post-employmentbenefits (healthcare cover) | 
|( million)                                                  |  | 2010                                 |       |      | 2009                                             |  |       | 2008 |  |  | 2010   |   |  | 2009 |     |   | 2008 | 
|Valuation of obligation:                                     |  |                                      |       |      |                                                  |  |       |      |  |  |        |   |  |      |     |   |      |  |     |   |  |  |     |  
|Beginning of period                                          |  |                                      | 8,924 |      |                                                  |  | 7,742 |      |  |  | 8,481  |   |  |      | 376 |   |      |  | 368 |   |  |  | 339 |  
|Service cost                                                 |  |                                      | 240   |      |                                                  |  | 218   |      |  |  | 228    |   |  |      | 14  |   |      |  | 16  |   |  |  | 12  |  
|Contributions from plan members                              |  |                                      | 5     |      |                                                  |  | 4     |      |  |  | 4      |   |  |      |    |   |      |  |    |   |  |  |    |  
|Interest cost                                                |  |                                      | 454   |      |                                                  |  | 446   |      |  |  | 435    |   |  |      | 22  |   |      |  | 21  |   |  |  | 19  |  
|Actuarial (gain)/loss                                        |  |                                      | 593   |      |                                                  |  | 759   |      |  |  | (579   | ) |  |      | 22  |   |      |  | 1   |   |  |  | 5   |  
|Plan amendments                                              |  |                                      | 15    |      |                                                  |  | 219   |      |  |  | 71     |   |  |      |    |   |      |  |    |   |  |  |    |  
|Translation differences                                      |  |                                      | 259   |      |                                                  |  | 64    |      |  |  | (336   | ) |  |      | 27  |   |      |  | (6  | ) |  |  | 8   |  
|Plan curtailments/settlements                                |  |                                      | (69   | )    |                                                  |  | (131  | )    |  |  | (68    | ) |  |      | (13 | ) |      |  | (4  | ) |  |  |    |  
|Changes in scope of consolidation, transfers                 |  |                                      | (283  | )(1) |                                                  |  | 145   |      |  |  | 34     |   |  |      | 1   |   |      |  |    |   |  |  | 2   |  
|Benefits paid                                                |  |                                      | (579  | )    |                                                  |  | (542  | )    |  |  | (528   | ) |  |      | (20 | ) |      |  | (20 | ) |  |  | (17 | )
|Obligation at end of period                                  |  |                                      | 9,559 |      |                                                  |  | 8,924 |      |  |  | 7,742  |   |  |      | 429 |   |      |  | 376 |   |  |  | 368 |  
|Fair value of plan assets:                                   |  |                                      |       |      |                                                  |  |       |      |  |  |        |   |  |      |     |   |      |  |     |   |  |  |     |  
|Beginning of period                                          |  |                                      | 4,876 |      |                                                  |  | 3,957 |      |  |  | 5,362  |   |  |      | 44  |   |      |  | 41  |   |  |  | 51  |  
|Expected return on plan assets                               |  |                                      | 347   |      |                                                  |  | 278   |      |  |  | 362    |   |  |      | 4   |   |      |  | 3   |   |  |  | 4   |  
|Difference between actual and expected return on plan assets |  |                                      | 252   |      |                                                  |  | 547   |      |  |  | (1,348 | ) |  |      | 3   |   |      |  | 6   |   |  |  | (12 | )
|Translation differences                                      |  |                                      | 185   |      |                                                  |  | 49    |      |  |  | (270   | ) |  |      | 4   |   |      |  | (2  | ) |  |  | 2   |  
|Contributions from plan members                              |  |                                      | 5     |      |                                                  |  | 4     |      |  |  | 4      |   |  |      |    |   |      |  |    |   |  |  |    |  
|Employers contributions                                     |  |                                      | 400   |      |                                                  |  | 405   |      |  |  | 175    |   |  |      | 1   |   |      |  | 1   |   |  |  |    |  
|Plan settlements                                             |  |                                      | (1    | )    |                                                  |  | (5    | )    |  |  | (2     | ) |  |      |    |   |      |  |    |   |  |  |    |  
|Changes in scope of consolidation, transfers                 |  |                                      | 5     |      |                                                  |  |      |      |  |  | 25     |   |  |      |    |   |      |  |    |   |  |  |    |  
|Benefits paid                                                |  |                                      | (408  | )    |                                                  |  | (359  | )    |  |  | (351   | ) |  |      | (5  | ) |      |  | (5  | ) |  |  | (4  | )
|Fair value of plan assets at end of period                   |  |                                      | 5,661 |      |                                                  |  | 4,876 |      |  |  | 3,957  |   |  |      | 51  |   |      |  | 44  |   |  |  | 41  |  
|Net amount shown in the balance sheet:                       |  |                                      |       |      |                                                  |  |       |      |  |  |        |   |  |      |     |   |      |  |     |   |  |  |     |  
|Net obligation                                               |  |                                      | 3,898 |      |                                                  |  | 4,048 |      |  |  | 3,785  |   |  |      | 378 |   |      |  | 332 |   |  |  | 327 |  
|Unrecognized past service cost                               |  |                                      | (45   | )    |                                                  |  | (49   | )    |  |  | (55    | ) |  |      | 7   |   |      |  | 6   |   |  |  | 6   |  
|Effect of asset ceiling                                      |  |                                      | 1     |      |                                                  |  | 2     |      |  |  | 4      |   |  |      |    |   |      |  |    |   |  |  |    |  
|Net amount shown in the balance sheet                        |  |                                      | 3,854 |      |                                                  |  | 4,001 |      |  |  | 3,734  |   |  |      | 385 |   |      |  | 338 |   |  |  | 333 |  
|Amounts recognized in the balance sheet:                     |  |                                      |       |      |                                                  |  |       |      |  |  |        |   |  |      |     |   |      |  |     |   |  |  |     |  
|Pre-funded obligations (see Note D.7.)                       |  |                                      | (4    | )    |                                                  |  | (3    | )    |  |  | (1     | ) |  |      |    |   |      |  |    |   |  |  |    |  
|Obligations provided for (2)                                 |  |                                      | 3,858 |      |                                                  |  | 4,004 |      |  |  | 3,735  |   |  |      | 385 |   |      |  | 338 |   |  |  | 333 |  
|Net amount recognized                                        |  |                                      | 3,854 |      |                                                  |  | 4,001 |      |  |  | 3,734  |   |  |      | 385 |   |      |  | 338 |   |  |  | 333 |  
|Benefit cost for the period:                                 |  |                                      |       |      |                                                  |  |       |      |  |  |        |   |  |      |     |   |      |  |     |   |  |  |     |  
|Service cost                                                 |  |                                      | 240   |      |                                                  |  | 218   |      |  |  | 228    |   |  |      | 14  |   |      |  | 16  |   |  |  | 12  |  
|Interest cost                                                |  |                                      | 454   |      |                                                  |  | 446   |      |  |  | 435    |   |  |      | 22  |   |      |  | 21  |   |  |  | 19  |  
|Expected return on plan assets                               |  |                                      | (347  | )    |                                                  |  | (278  | )    |  |  | (362   | ) |  |      | (4  | ) |      |  | (3  | ) |  |  | (4  | )
|Amortization of past service cost                            |  |                                      | 20    |      |                                                  |  | 224   |      |  |  | 42     |   |  |      |    |   |      |  |    |   |  |  |    |  
|Recognition of actuarial (gains)/losses                      |  |                                      | 44    |      |                                                  |  | 38    |      |  |  | (38    | ) |  |      |    |   |      |  |    |   |  |  |    |  
|Effect of plan curtailments                                  |  |                                      | (69   | )    |                                                  |  | (122  | )    |  |  | (38    | ) |  |      | (13 | ) |      |  | (4  | ) |  |  |    |  
|Effect of plan settlements                                   |  |                                      |      |      |                                                  |  | (3    | )    |  |  | (27    | ) |  |      |    |   |      |  |    |   |  |  |    |  
|Benefit cost for the period                                  |  |                                      | 342   |      |                                                  |  | 523   |      |  |  | 240    |   |  |      | 19  |   |      |  | 30  |   |  |  | 27  |  



|(1) | Includes a reduction of 322 million in respect of social security
charges and Fillon levies due on early retirement plans in France, which were provided for as part of the pension obligation at December 31, 2009 but were reclassified as restructuring provisions at December 31, 2010; these
provisions also include the portion relating to annuities (see Note D.19.2.).
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Long-term benefits awarded to employees prior to retirement (mainly discretionary
bonuses, long service awards and deferred compensation plans) accounted for 445 million of these obligations at December 31, 2010, 371 million at December 31, 2009, and 346 million at December 31,
2008. The expense associated with these obligations totaled 106 million in 2010, 84 million in 2009, and 31 million in 2008.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



F-77



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Actuarial gains and losses on pensions and other post-employment benefits break down as
follows:



|                                                    |  |      |       |   |      |  |       |      |  |  |        |   |  |      |       |   |  |  |       |  
|--------------------------------------------------- |  | ---- | ----- | - | ---- |  | ----- | ---- |  |  | ------ | - |  | ---- | ----- | - |  |  | ----- | -
|( million)                                         |  | 2010 |       |   | 2009 |  |       | 2008 |  |  | 2007   |   |  | 2006 |      
|Actuarial gain/(loss) arising during the period(1)  |  |      | (360  | ) |      |  | (207  | )    |  |  | (786   | ) |  |      | 289   |   |  |  | 359   |  
|Comprising:                                         |  |      |       |   |      |  |       |      |  |  |        |   |  |      |       |   |  |  |       |  
| gain/(loss) on experience adjustments             |  |      | 169   |   |      |  | 531   |      |  |  | (1,326 | ) |  |      | (135  | ) |  |  | 126   |  
| gain/(loss) on changes in assumptions(2)          |  |      | (529  | ) |      |  | (738  | )    |  |  | 540    |   |  |      | 424   |   |  |  | 233   |  
|Breakdown of experience adjustments:                |  |      |       |   |      |  |       |      |  |  |        |   |  |      |       |   |  |  |       |  
| gain/(loss) on plan assets(3)                     |  |      | 255   |   |      |  | 553   |      |  |  | (1,360 | ) |  |      | (160  | ) |  |  | 191   |  
| gain/(loss) on obligations                        |  |      | (86   | ) |      |  | (22   | )    |  |  | 34     |   |  |      | 25    |   |  |  | (65   | )
|Amount of obligations at the balance sheet date     |  |      | 9,988 |   |      |  | 9,300 |      |  |  | 8,110  |   |  |      | 8,820 |   |  |  | 9,508 |  
|Fair value of plan assets at the balance sheet date |  |      | 5,712 |   |      |  | 4,920 |      |  |  | 3,998  |   |  |      | 5,413 |   |  |  | 5,631 |  



|(1) | For 2010, comprises a loss of 316 million recognized in equity (see
Note D.15.7.) and a loss of 44 million taken directly to the income statement; for 2009, comprises a loss of 169 million recognized in equity (see Note D.15.7.) and a loss of 38 million taken directly to the income
statement.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Changes in assumptions relate mainly to changes in discount rates.
|--- | ------------------------------------------------------------------

|(3) | Experience adjustments are due to trends in the financial markets.
|--- | ------------------------------------------------------------------



The net pre-tax
actuarial loss recognized directly in equity (excluding associates, joint ventures and Merial) was 1,459 million at December 31, 2010, versus 1,143 million at December 31, 2009 and 974 million at
December 31, 2008.



As of December 31,
2010, the present value of obligations in respect of pensions and similar benefits under wholly or partially funded plans was 7,589 million, and the present value of unfunded obligations was 1,969 million (versus respectively,
6,897 million and 2,027 million at December 31, 2009, and 5,924 million and 1,817 million at December 31, 2008).



In Germany, sanofi-aventis is a member of a
Pensionskasse multi-employer plan. This is a defined-benefit plan accounted for as a defined-contribution plan in accordance with the accounting policy described in Note B.23. Plan contributions cover the current level of annuities. However,
the obligation arising from future increases in annuity rates is recognized as part of the overall pension obligation; it amounted to 487 million at December 31, 2010, 449 million at December 31, 2009, and
393 million at December 31, 2008.



The table below shows the sensitivity of (i) the benefit cost recognized in the consolidated income statement, and (ii) the
obligation in the consolidated balance sheet, to changes in healthcare costs associated with other post-employment benefits.



|                                            |  |                               |     |  
|------------------------------------------- |  | ----------------------------- | --- | -
|( million)                                 |  | Sensitivity ofassumptions2010 |    
|1% increase in healthcare costs             |  |                               |     |  
| Impact on benefit cost for the period     |  |                               | 3   |  
| Impact on obligation in the balance sheet |  |                               | 37  |  
|1% reduction in healthcare costs            |  |                               |     |  
| Impact on benefit cost for the period     |  |                               | (3  | )
| Impact on obligation in the balance sheet |  |                               | (29 | )



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The total cost of pensions and other benefits, which amounted to 361 million
in 2010, is split as follows:



|                                    |  |                            |     |      |                            |  |     | 
|----------------------------------- |  | -------------------------- | --- | ---- | -------------------------- |  | --- | 
|( million)                         |  | Year endedDecember 31,2010 |     |      | Year endedDecember 31,2009 | 
| Cost of sales                     |  |                            | 121 |      |                            |  | 111 | 
| Research and development expenses |  |                            | 98  |      |                            |  | 98  | 
| Selling and general expenses      |  |                            | 155 |      |                            |  | 195 | 
| Other operating expenses          |  |                            | 51  |      |                            |  | 59  | 
| Financial expenses(1)             |  |                            | 9   |      |                            |  | 13  | 
| Restructuring costs               |  |                            | (73 | )(2) |                            |  | 77  | 
|Total                               |  |                            | 361 |      |                            |  | 553 | 



|(1) | This line comprises actuarial gains and losses on deferred compensation plans
funded by assets recognized under the fair value option (see Note D.7.). These actuarial gains and losses are offset by changes in the fair value of those assets.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Impact of plan curtailments following the redundancy programs announced in 2010
(see Note D.19.2.).
|--- | ---------------------------------------------------------------------------------------------------



The total cost of pensions and other benefits (excluding the effect of plan curtailments and settlements) for 2008 was
332 million, split as follows:



| |  |  | Cost of sales: 91 million
| | - |  | --------------------------



| |  |  | Research and development expenses: 61 million
| | - |  | ----------------------------------------------



| |  |  | Selling and general expenses: 180 million
| | - |  | ------------------------------------------



The table below shows the expected cash outflows on pensions and other post-employment benefits over the next
ten years:



|                                          |  |                            |       | 
|----------------------------------------- |  | -------------------------- | ----- | 
|( million)                               |  | Pensions andother benefits |      
|Estimated employers contribution in 2011 |  |                            | 281   | 
|Estimated benefit payments:               |  |                            |       | 
|2011                                      |  |                            | 575   | 
|2012                                      |  |                            | 572   | 
|2013                                      |  |                            | 607   | 
|2014                                      |  |                            | 610   | 
|2015                                      |  |                            | 646   | 
|2016 through 2020                         |  |                            | 3,449 | 



F-79



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



D.19.2. Restructuring provisions



The table below shows movements in restructuring provisions classified in
non-current liabilities and current liabilities:



|                                                                 |  |                  |       |     |                  |  |       |                  |  |  |      |  
|---------------------------------------------------------------- |  | ---------------- | ----- | --- | ---------------- |  | ----- | ---------------- |  |  | ---- | -
|( million)                                                      |  | December 31,2010 |       |     | December 31,2009 |  |       | December 31,2008 | 
|Balance, beginning of period                                     |  |                  | 1,018 |     |                  |  | 678   |                  |  |  | 395  |  
|of which:                                                        |  |                  |       |     |                  |  |       |                  |  |  |      |  
| Classified in non-current liabilities                          |  |                  | 257   |     |                  |  | 366   |                  |  |  | 188  |  
| Classified in current liabilities                              |  |                  | 761   |     |                  |  | 312   |                  |  |  | 207  |  
|Change in provisions recognized in profit or loss for the period |  |                  | 1,073 |     |                  |  | 837   |                  |  |  | 510  |  
|Provisions utilized                                              |  |                  | (839  | )   |                  |  | (388  | )                |  |  | (228 | )
|Transfers                                                        |  |                  | 322   | (1) |                  |  | (110  | )                |  |  | (3   | )
|Unwinding of discount                                            |  |                  | 27    |     |                  |  | 3     |                  |  |  | 5    |  
|Translation differences                                          |  |                  | 10    |     |                  |  | (2    | )                |  |  | (1   | )
|Balance, end of period                                           |  |                  | 1,611 |     |                  |  | 1,018 |                  |  |  | 678  |  
|of which:                                                        |  |                  |       |     |                  |  |       |                  |  |  |      |  
| Classified in non-current liabilities                          |  |                  | 1,017 |     |                  |  | 257   |                  |  |  | 366  |  
| Classified in current liabilities                              |  |                  | 594   |     |                  |  | 761   |                  |  |  | 312  |  



|(1) | Reclassification of social security charges and Fillon levies
relating to early retirement plans in France (see Note D.19.1.).
|--- | --------------------------------------------------------------------------------------------------------------------------------



Provision for employee termination benefits at December 31, 2010 amounted to 1,265 million, mainly covering the redundancy programs announced as part of the adaptation of sales forces,
R&D and industrial operations in France, the United States, and some other European countries. The provision relating to France (889 million at December 31, 2010) mainly comprises the present value of gross annuities under early
retirement plans not outsourced as of that date, plus social security charges and Fillon levies on those annuities and on outsourced annuities. The average residual period of carry under these plans as of December 31, 2010 was 3.6
years. The amount of premium paid in connection with the outsourcing of annuities during 2010 was 241 million.



The timing of future termination benefit payments is as follows:



|                              |  |                              |       |  |                 |  |     |                  |  |  |                  |  |  |                  |     |  |  |  |     | 
|----------------------------- |  | ---------------------------- | ----- |  | --------------- |  | --- | ---------------- |  |  | ---------------- |  |  | ---------------- | --- |  |  |  | --- | 
|                              |  | Year ended December 31, 2010 |      
|                              |  | Benefit payments by period   |      
|( million)                   |  | Total                        |       |  | Less than1 year |  |     | From 1 to 3years |  |  | From 3 to 5years |  |  | More than 5years |    
|Employee termination benefits |  |                              |       |  |                 |  |     |                  |  |  |                  |  |  |                  |     |  |  |  |     | 
| France                      |  |                              | 889   |  |                 |  | 233 |                  |  |  | 263              |  |  |                  | 217 |  |  |  | 176 | 
| Other countries             |  |                              | 376   |  |                 |  | 226 |                  |  |  | 127              |  |  |                  | 13  |  |  |  | 10  | 
|Total                         |  |                              | 1,265 |  |                 |  | 459 |                  |  |  | 390              |  |  |                  | 230 |  |  |  | 186 | 



Movements during 2010 recognized in profit or loss for the period mainly comprise expenses relating to measures taken to adapt chemical
industrial activities in France, and sales and R&D functions in Western Europe and North America. This item also includes a remeasurement of previously-recognized obligations under early retirement plans following the pension reforms in France.
Movements in restructuring provisions during 2010 also include the job protection guarantee made to Covance in connection with the divestment of the Alnwick and Porcheville sites (see Note D.27).



An analysis of restructuring costs by type is provided in
Note D.27.



F-80



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



D.19.3. Other provisions



Other provisions include provisions for environmental, tax,
commercial and product liability risks, and for litigation.



|                                              |  |                  |       |  |                  |  |       |                  |  |  |       | 
|--------------------------------------------- |  | ---------------- | ----- |  | ---------------- |  | ----- | ---------------- |  |  | ----- | 
|( million)                                   |  | December 31,2010 |       |  | December 31,2009 |  |       | December 31,2008 | 
|Tax exposures                                 |  |                  | 2,228 |  |                  |  | 2,009 |                  |  |  | 1,770 | 
|Environmental risks and remediation           |  |                  | 781   |  |                  |  | 695   |                  |  |  | 589   | 
|Product liability risks, litigation and other |  |                  | 951   |  |                  |  | 829   |                  |  |  | 725   | 
|Total                                         |  |                  | 3,960 |  |                  |  | 3,533 |                  |  |  | 3,084 | 



Provisions for tax exposures are recorded if the Group is exposed to a probable risk resulting from a tax position adopted by the Group or
a subsidiary, and the risk has been quantified at the balance sheet date.



Provisions for Environmental risks and remediation mainly relate to contingencies arising from business divestments. The movement during 2010 includes 105 million charged to
restructuring costs in connection with the adaptation of chemical industrial facilities in France (see Note D.27.).



Identified environmental risks are covered by provisions estimated on the basis of the costs sanofi-aventis believes it will be obliged to
meet over a period not exceeding (other than in exceptional cases) 30 years. Sanofi-aventis expects that 119 million of these provisions will be utilized in 2011 and 386 million over the period from 2012 through 2015.



Product liability risks, litigation and
other mainly comprises provisions for risks relating to product liability (including IBNR provisions as described in Note B.12.), government investigations, regulatory or competition law claims or contingencies arising from
business divestments (other than environmental risks).



The main pending legal and arbitral proceedings and government investigations are described in Note D.22.



A full risk and litigation assessment is performed with the assistance of the Groups legal advisers, and provisions are recorded as
required by circumstances in accordance with the principles described in Note B.12.



D.19.4. Other current liabilities



Other current liabilities break down as follows:



|                                                       |  |                  |       |  |                  |  |       |                  |  |  |       | 
|------------------------------------------------------ |  | ---------------- | ----- |  | ---------------- |  | ----- | ---------------- |  |  | ----- | 
|( million)                                            |  | December 31,2010 |       |  | December 31,2009 |  |       | December 31,2008 | 
|Taxes payable                                          |  |                  | 785   |  |                  |  | 631   |                  |  |  | 664   | 
|Employee-related liabilities                           |  |                  | 1,411 |  |                  |  | 1,458 |                  |  |  | 1,366 | 
|Restructuring provisions (see Note D.19.2.)            |  |                  | 594   |  |                  |  | 761   |                  |  |  | 312   | 
|Interest rate derivatives (see Note D.20.)             |  |                  | 3     |  |                  |  | 62    |                  |  |  |      | 
|Currency derivatives (see Note D.20.)                  |  |                  | 104   |  |                  |  | 119   |                  |  |  | 249   | 
|Amounts payable for acquisitions of non-current assets |  |                  | 267   |  |                  |  | 251   |                  |  |  | 292   | 
|Other liabilities                                      |  |                  | 2,460 |  |                  |  | 2,087 |                  |  |  | 1,838 | 
|Total                                                  |  |                  | 5,624 |  |                  |  | 5,369 |                  |  |  | 4,721 | 



This item includes the current portion of provisions for litigation, sales returns and other risks; amounts due to associates and joint
ventures (see Note D.6.) and amounts due to governmental agencies and the healthcare authorities (see Note D.23.).



F-81



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



D.20. Derivative financial instruments and market risks



The table below shows the fair value of derivative
instruments as of December 31, 2010:



|                          |  |                   |     |  |               |  |    |             |  |  |                        |  |  |                    |     |   |                  |  |      |                                 |  |  |                                 |   |  |                                 |      |   |  |  |     |   |  |  |     |  
|------------------------- |  | ----------------- | --- |  | ------------- |  | -- | ----------- |  |  | ---------------------- |  |  | ------------------ | --- | - | ---------------- |  | ---- | ------------------------------- |  |  | ------------------------------- | - |  | ------------------------------- | ---- | - |  |  | --- | - |  |  | --- | -
|( million)               |  | Non-currentassets |     |  | Currentassets |  |    | Totalassets |  |  | Non-currentliabilities |  |  | Currentliabilities |     |   | Totalliabilities |  |      | Fair value atDec. 31,2010 (net) |  |  | Fair value atDec. 31,2009 (net) |   |  | Fair value atDec. 31,2008 (net) |     
|Currency derivatives      |  |                   |    |  |               |  | 27 |             |  |  | 27                     |  |  |                    | (27 | ) |                  |  | (104 | )                               |  |  | (131                            | ) |  |                                 | (104 | ) |  |  | 132 |   |  |  | 139 |  
| operational             |  |                   |    |  |               |  | 14 |             |  |  | 14                     |  |  |                    |    |   |                  |  | (41  | )                               |  |  | (41                             | ) |  |                                 | (27  | ) |  |  | (46 | ) |  |  | 201 |  
| financial               |  |                   |    |  |               |  | 13 |             |  |  | 13                     |  |  |                    | (27 | ) |                  |  | (63  | )                               |  |  | (90                             | ) |  |                                 | (77  | ) |  |  | 178 |   |  |  | (62 | )
|Interest rate derivatives |  |                   | 220 |  |               |  | 1  |             |  |  | 221                    |  |  |                    |    |   |                  |  | (3   | )                               |  |  | (3                              | ) |  |                                 | 218  |   |  |  | 7   |   |  |  | (22 | )
|Total                     |  |                   | 220 |  |               |  | 28 |             |  |  | 248                    |  |  |                    | (27 | ) |                  |  | (107 | )                               |  |  | (134                            | ) |  |                                 | 114  |   |  |  | 139 |   |  |  | 117 |  



Objectives of the use of derivative financial instruments



Sanofi-aventis uses derivative instruments primarily to manage operational exposure to movements in exchange rates, and financial exposure
to movements in interest rates and exchange rates (where the debt is not contracted in the functional currency of the borrower or lender entity). Less frequently, sanofi-aventis uses equity derivatives in connection with the management of its
portfolio of equity investments.



Sanofi-aventis
performs periodic reviews of its transactions and contractual agreements in order to identify any embedded derivatives, which are accounted for separately from the host contract in accordance with IAS 39. As of December 31, 2010, sanofi-aventis
had no material embedded derivatives.



Counterparty risk



As of December 31, 2010, all currency
and interest rate hedges were contracted with leading banks, and no single counterparty accounted for more than 12% of the notional amount of the Groups overall currency and interest rate positions.



D.20.1. Currency and interest rate derivatives



a) Currency derivatives used to manage operational risk exposures



Sanofi-aventis operates a foreign exchange
risk hedging policy to reduce the exposure of operating income to fluctuations in foreign currencies, in particular the U.S. dollar. This policy involves regular assessments of the Groups worldwide foreign currency exposure, based on budget
estimates of foreign-currency transactions to be carried out by the parent company and its subsidiaries. These transactions mainly comprise sales, purchases, research costs, co-marketing and co-promotion expenses, and royalties. To reduce the
exposure of these transactions to exchange rate movements, sanofi-aventis contracts economic hedges using liquid financial instruments such as forward purchases and sales of currency, call and put options, and combinations of currency options
(collars).



F-82



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The table below shows operational currency hedging instruments in place as of
December 31, 2010, with the notional amount translated into euros at the relevant closing exchange rate.



|                             |  |                |       |  |           |  |     |                                                    |  |  |                                                       |  |  |                             |   |  |                |  |   |            |  |  |       |  |  |  |     |  
|---------------------------- |  | -------------- | ----- |  | --------- |  | --- | -------------------------------------------------- |  |  | ----------------------------------------------------- |  |  | --------------------------- | - |  | -------------- |  | - | ---------- |  |  | ----- |  |  |  | --- | -
|December 31, 2010            |  |                |       |  |           |  |     | Of which derivatives designatedas cash flow hedges |  |  | Of which derivatives not eligiblefor hedge accounting | 
|( million)                  |  | Notionalamount |       |  | Fairvalue |  |     | Notionalamount                                     |  |  | Fairvalue                                             |  |  | Of whichrecognizedin equity |   |  | Notionalamount |  |   | Fair value | 
|Forward currency sales       |  |                | 2,444 |  |           |  | (25 | )                                                  |  |  |                                                      |  |  |                             |  |  |                |  |  |            |  |  | 2,444 |  |  |  | (25 | )
| of which U.S. dollar       |  |                | 1,380 |  |           |  | (12 | )                                                  |  |  |                                                      |  |  |                             |  |  |                |  |  |            |  |  | 1,380 |  |  |  | (12 | )
| of which Russian rouble    |  |                | 248   |  |           |  | (7  | )                                                  |  |  |                                                      |  |  |                             |  |  |                |  |  |            |  |  | 248   |  |  |  | (7  | )
| of which Japanese yen      |  |                | 202   |  |           |  | (4  | )                                                  |  |  |                                                      |  |  |                             |  |  |                |  |  |            |  |  | 202   |  |  |  | (4  | )
| of which Pound sterling    |  |                | 95    |  |           |  | 2   |                                                    |  |  |                                                      |  |  |                             |  |  |                |  |  |            |  |  | 95    |  |  |  | 2   |  
| of which Australian dollar |  |                | 60    |  |           |  | (1  | )                                                  |  |  |                                                      |  |  |                             |  |  |                |  |  |            |  |  | 60    |  |  |  | (1  | )
|Forward currency purchases   |  |                | 257   |  |           |  | (2  | )                                                  |  |  |                                                      |  |  |                             |  |  |                |  |  |            |  |  | 257   |  |  |  | (2  | )
| of which Hungarian forint  |  |                | 84    |  |           |  | (1  | )                                                  |  |  |                                                      |  |  |                             |  |  |                |  |  |            |  |  | 84    |  |  |  | (1  | )
| of which U.S. dollar       |  |                | 51    |  |           |  | (1  | )                                                  |  |  |                                                      |  |  |                             |  |  |                |  |  |            |  |  | 51    |  |  |  | (1  | )
| of which Canadian dollar   |  |                | 31    |  |           |  |    |                                                    |  |  |                                                      |  |  |                             |  |  |                |  |  |            |  |  | 31    |  |  |  |    |  
| of which Russian rouble    |  |                | 30    |  |           |  |    |                                                    |  |  |                                                      |  |  |                             |  |  |                |  |  |            |  |  | 30    |  |  |  |    |  
| of which Japanese yen      |  |                | 18    |  |           |  |    |                                                    |  |  |                                                      |  |  |                             |  |  |                |  |  |            |  |  | 18    |  |  |  |    |  
|Total                        |  |                | 2,701 |  |           |  | (27 | )                                                  |  |  |                                                      |  |  |                             |  |  |                |  |  |            |  |  | 2,701 |  |  |  | (27 | )



As of December 31, 2010, none of these instruments had an expiry date after March 31, 2011.



These positions mainly hedge material future foreign-currency
cash flows arising after the balance sheet date in relation to transactions carried out during the year ended December 31, 2010 and recognized in the balance sheet at that date. Gains and losses on hedging instruments (forward contracts) are
calculated and recognized in parallel with the recognition of gains and losses on the hedged items. Consequently, the commercial foreign exchange gain or loss to be recognized on these items (hedges and hedged instruments) in 2011 is not expected to
be material.



F-83



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The table below shows operational currency hedging instruments in place as of
December 31, 2009, with the notional amount translated into euros at the relevant closing exchange rate.



|                            |  |                |       |  |           |  |     |                                                    |  |  |                                                       |  |  |                             |    |   |                |  |    |            |  |  |       |  |  |  |     |  
|--------------------------- |  | -------------- | ----- |  | --------- |  | --- | -------------------------------------------------- |  |  | ----------------------------------------------------- |  |  | --------------------------- | -- | - | -------------- |  | -- | ---------- |  |  | ----- |  |  |  | --- | -
|December 31, 2009           |  |                |       |  |           |  |     | Of which derivatives designatedas cash flow hedges |  |  | Of which derivatives not eligiblefor hedge accounting | 
|( million)                 |  | Notionalamount |       |  | Fairvalue |  |     | Notionalamount                                     |  |  | Fairvalue                                             |  |  | Of whichrecognizedin equity |    |   | Notionalamount |  |    | Fair value | 
|Forward currency sales      |  |                | 2,800 |  |           |  | (51 | )                                                  |  |  | 583                                                   |  |  |                             | (7 | ) |                |  | (7 | )          |  |  | 2,217 |  |  |  | (44 | )
| of which U.S. dollar      |  |                | 1,757 |  |           |  | (41 | )                                                  |  |  | 367                                                   |  |  |                             | (5 | ) |                |  | (5 | )          |  |  | 1,390 |  |  |  | (36 | )
| of which Japanese yen     |  |                | 269   |  |           |  | 1   |                                                    |  |  | 150                                                   |  |  |                             | (1 | ) |                |  | (1 | )          |  |  | 119   |  |  |  | 2   |  
| of which Russian rouble   |  |                | 132   |  |           |  | (4  | )                                                  |  |  |                                                      |  |  |                             |   |   |                |  |   |            |  |  | 132   |  |  |  | (4  | )
| of which Pound sterling   |  |                | 111   |  |           |  |    |                                                    |  |  |                                                      |  |  |                             |   |   |                |  |   |            |  |  | 111   |  |  |  |    |  
| of which Hungarian forint |  |                | 104   |  |           |  | (1  | )                                                  |  |  |                                                      |  |  |                             |   |   |                |  |   |            |  |  | 104   |  |  |  | (1  | )
|Forward currency purchases  |  |                | 377   |  |           |  | 6   |                                                    |  |  |                                                      |  |  |                             |   |   |                |  |   |            |  |  | 377   |  |  |  | 6   |  
| of which Hungarian forint |  |                | 114   |  |           |  | 3   |                                                    |  |  |                                                      |  |  |                             |   |   |                |  |   |            |  |  | 114   |  |  |  | 3   |  
| of which U.S. dollar      |  |                | 69    |  |           |  |    |                                                    |  |  |                                                      |  |  |                             |   |   |                |  |   |            |  |  | 69    |  |  |  |    |  
| of which Pound sterling   |  |                | 68    |  |           |  | 1   |                                                    |  |  |                                                      |  |  |                             |   |   |                |  |   |            |  |  | 68    |  |  |  | 1   |  
| of which Canadian dollar  |  |                | 42    |  |           |  | 1   |                                                    |  |  |                                                      |  |  |                             |   |   |                |  |   |            |  |  | 42    |  |  |  | 1   |  
| of which Swiss franc      |  |                | 20    |  |           |  |    |                                                    |  |  |                                                      |  |  |                             |   |   |                |  |   |            |  |  | 20    |  |  |  |    |  
|Put options purchased       |  |                | 448   |  |           |  | 14  |                                                    |  |  | 20                                                    |  |  |                             | 1  |   |                |  |   |            |  |  | 428   |  |  |  | 13  |  
| of which U.S. dollar      |  |                | 278   |  |           |  | 8   |                                                    |  |  |                                                      |  |  |                             |   |   |                |  |   |            |  |  | 278   |  |  |  | 8   |  
|Call options written        |  |                | 881   |  |           |  | (17 | )                                                  |  |  | 20                                                    |  |  |                             | (1 | ) |                |  |   |            |  |  | 861   |  |  |  | (16 | )
| of which U.S. dollar      |  |                | 555   |  |           |  | (10 | )                                                  |  |  |                                                      |  |  |                             |   |   |                |  |   |            |  |  | 555   |  |  |  | (10 | )
|Put options written         |  |                | 278   |  |           |  | (8  | )                                                  |  |  |                                                      |  |  |                             |   |   |                |  |   |            |  |  | 278   |  |  |  | (8  | )
| of which U.S. dollar      |  |                | 278   |  |           |  | (8  | )                                                  |  |  |                                                      |  |  |                             |   |   |                |  |   |            |  |  | 278   |  |  |  | (8  | )
|Call options purchased      |  |                | 555   |  |           |  | 10  |                                                    |  |  |                                                      |  |  |                             |   |   |                |  |   |            |  |  | 555   |  |  |  | 10  |  
| of which U.S. dollar      |  |                | 555   |  |           |  | 10  |                                                    |  |  |                                                      |  |  |                             |   |   |                |  |   |            |  |  | 555   |  |  |  | 10  |  
|Total                       |  |                | 5,339 |  |           |  | (46 | )                                                  |  |  | 623                                                   |  |  |                             | (7 | ) |                |  | (7 | )          |  |  | 4,716 |  |  |  | (39 | )



F-84



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The table below shows operational currency hedging instruments in place as of
December 31, 2008, with the notional amount translated into euros at the relevant closing exchange rate.



|                               |  |                |       |  |           |  |     |                                                    |  |  |                                                       |  |  |                             |     |  |                |  |     |            |  |  |       |  |  |  |     |  
|------------------------------ |  | -------------- | ----- |  | --------- |  | --- | -------------------------------------------------- |  |  | ----------------------------------------------------- |  |  | --------------------------- | --- |  | -------------- |  | --- | ---------- |  |  | ----- |  |  |  | --- | -
|December 31, 2008              |  |                |       |  |           |  |     | Of which derivatives designatedas cash flow hedges |  |  | Of which derivatives not eligiblefor hedge accounting | 
|( million)                    |  | Notionalamount |       |  | Fairvalue |  |     | Notionalamount                                     |  |  | Fairvalue                                             |  |  | Of whichrecognizedin equity |     |  | Notionalamount |  |     | Fair value | 
|Forward currency sales         |  |                | 3,305 |  |           |  | 219 |                                                    |  |  | 1,562                                                 |  |  |                             | 121 |  |                |  | 123 |            |  |  | 1,743 |  |  |  | 98  |  
| of which U.S. dollar         |  |                | 2,461 |  |           |  | 182 |                                                    |  |  | 1,358                                                 |  |  |                             | 108 |  |                |  | 111 |            |  |  | 1,103 |  |  |  | 74  |  
| of which Japanese yen        |  |                | 191   |  |           |  | (5  | )                                                  |  |  | 95                                                    |  |  |                             | 3   |  |                |  | 2   |            |  |  | 96    |  |  |  | (8  | )
| of which Russian rouble      |  |                | 134   |  |           |  | 15  |                                                    |  |  |                                                      |  |  |                             |    |  |                |  |    |            |  |  | 134   |  |  |  | 15  |  
| of which Pound sterling      |  |                | 104   |  |           |  | 6   |                                                    |  |  |                                                      |  |  |                             |    |  |                |  |    |            |  |  | 104   |  |  |  | 6   |  
| of which Saudi Arabian riyal |  |                | 58    |  |           |  | 5   |                                                    |  |  | 4                                                     |  |  |                             |    |  |                |  |    |            |  |  | 54    |  |  |  | 5   |  
| of which Polish zloty        |  |                | 53    |  |           |  | 6   |                                                    |  |  | 33                                                    |  |  |                             | 5   |  |                |  | 6   |            |  |  | 20    |  |  |  | 1   |  
|Forward currency purchases     |  |                | 601   |  |           |  | (11 | )                                                  |  |  |                                                      |  |  |                             |    |  |                |  |    |            |  |  | 601   |  |  |  | (11 | )
| of which Hungarian forint    |  |                | 175   |  |           |  | (1  | )                                                  |  |  |                                                      |  |  |                             |    |  |                |  |    |            |  |  | 175   |  |  |  | (1  | )
| of which U.S. dollar         |  |                | 140   |  |           |  | 3   |                                                    |  |  |                                                      |  |  |                             |    |  |                |  |    |            |  |  | 140   |  |  |  | 3   |  
| of which Pound sterling      |  |                | 75    |  |           |  | (6  | )                                                  |  |  |                                                      |  |  |                             |    |  |                |  |    |            |  |  | 75    |  |  |  | (6  | )
| of which Russian rouble      |  |                | 72    |  |           |  | (6  | )                                                  |  |  |                                                      |  |  |                             |    |  |                |  |    |            |  |  | 72    |  |  |  | (6  | )
| of which Canadian dollar     |  |                | 51    |  |           |  | (1  | )                                                  |  |  |                                                      |  |  |                             |    |  |                |  |    |            |  |  | 51    |  |  |  | (1  | )
|Put options purchased          |  |                | 24    |  |           |  |    |                                                    |  |  | 2                                                     |  |  |                             |    |  |                |  |    |            |  |  | 22    |  |  |  |    |  
|Call options written           |  |                | 48    |  |           |  | (7  | )                                                  |  |  | 2                                                     |  |  |                             |    |  |                |  |    |            |  |  | 46    |  |  |  | (7  | )
|Total                          |  |                | 3,978 |  |           |  | 201 |                                                    |  |  | 1,566                                                 |  |  |                             | 121 |  |                |  | 123 |            |  |  | 2,412 |  |  |  | 80  |  



b) Currency and interest rate derivatives used to manage financial risk exposures



Cash pooling arrangements for foreign subsidiaries outside the euro zone, and some of the Groups
financing activities, expose certain entities to financial foreign exchange risk. This is the risk of changes in the value of borrowings and loans denominated in a currency other than the functional currency of the borrower or lender. This risk is
hedged by currency swaps or forward contracts, and mainly affects the sanofi-aventis parent company.



F-85



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The table below shows instruments used to manage financial risk exposures as of
December 31, 2010, with the notional amount translated into euros at the relevant closing exchange rate.



|                           |  |                |       |  |           |  |     |        |  |  |                |  |  |           |       |  |        |  |     |                |  |  |           |  |  |        |        |  |  |  |     |   |  |  |      | 
|-------------------------- |  | -------------- | ----- |  | --------- |  | --- | ------ |  |  | -------------- |  |  | --------- | ----- |  | ------ |  | --- | -------------- |  |  | --------- |  |  | ------ | ------ |  |  |  | --- | - |  |  | ---- | 
|                           |  | 2010           |       |  | 2009      |  |     | 2008   | 
|( million)                |  | Notionalamount |       |  | Fairvalue |  |     | Expiry |  |  | Notionalamount |  |  | Fairvalue |       |  | Expiry |  |     | Notionalamount |  |  | Fairvalue |  |  | Expiry |       
|Forward currency purchases |  |                | 2,086 |  |           |  | (13 | )      |  |  |               |  |  |           | 6,760 |  |        |  | 185 |                |  |  |          |  |  |        | 8,492  |  |  |  | (40 | ) |  |  |     | 
| of which U.S. dollar     |  |                | 814   |  |           |  | (8  | )      |  |  | 2011           |  |  |           | 5,634 |  |        |  | 180 |                |  |  | 2010      |  |  |        | 7,538  |  |  |  | (26 | ) |  |  | 2009 | 
| of which Pound sterling  |  |                | 565   |  |           |  | (11 | )      |  |  | 2011           |  |  |           | 433   |  |        |  | 2   |                |  |  | 2010      |  |  |        | 235    |  |  |  | (4  | ) |  |  | 2009 | 
| of which Japanese yen    |  |                | 169   |  |           |  |    |        |  |  | 2011           |  |  |           | 121   |  |        |  | (2  | )              |  |  | 2010      |  |  |        | 105    |  |  |  |    |   |  |  | 2009 | 
|Forward currency sales     |  |                | 2,728 |  |           |  | (64 | )      |  |  |               |  |  |           | 3,169 |  |        |  | (7  | )              |  |  |          |  |  |        | 1,954  |  |  |  | (22 | ) |  |  |     | 
| of which Japanese yen    |  |                | 904   |  |           |  | (24 | )      |  |  | 2011           |  |  |           | 837   |  |        |  | 18  |                |  |  | 2010      |  |  |        | 665    |  |  |  | (7  | ) |  |  | 2009 | 
| of which U.S. dollar     |  |                | 862   |  |           |  | (26 | )      |  |  | 2012           |  |  |           | 1,634 |  |        |  | (28 | )              |  |  | 2010      |  |  |        | 1,043  |  |  |  | (23 | ) |  |  | 2009 | 
| of which Czech koruna    |  |                | 359   |  |           |  | (7  | )      |  |  | 2011           |  |  |           | 394   |  |        |  | 7   |                |  |  | 2010      |  |  |        | 22     |  |  |  | 1   |   |  |  | 2009 | 
|Total                      |  |                | 4,814 |  |           |  | (77 | )      |  |  |                |  |  |           | 9,929 |  |        |  | 178 |                |  |  |           |  |  |        | 10,446 |  |  |  | (62 | ) |  |  |      | 



These forward contracts generate a net financial foreign exchange gain or loss arising from the interest rate gap between the hedged currency and the euro, given that the foreign exchange gain or loss on
the foreign-currency liabilities and receivables is offset by the change in the intrinsic value of the hedging instruments. In addition, the Group may hedge some future foreign-currency cash flows relating to investment or divestment transactions.



The Groups interest rate exposure arises
from (i) fixed-rate debt (primarily bond issues), the fair value of which moves in line with fluctuations in market interest rates; and (ii) floating-rate or adjustable-rate debt and cash investments (credit facilities, commercial paper,
floating rate notes, funds placed in collective investment schemes), on which interest outflows and inflows are exposed to fluctuations in benchmark rates (principally Eonia, U.S. Libor and Euribor). To reduce the cost and/or volatility of its
short-term and medium-term debt, we use interest rate swaps, cross-currency swaps, and in certain circumstances interest rate options (purchases of caps, or combined purchases of caps and sales of floors) that alter the fixed/floating structure of
our debt.



During 2010, sanofi-aventis contracted
hedges of net investments in foreign operations relating to financial assets in U.S. dollars ($3,672 million) and in Canadian dollars (CAD 405 million). These hedges had expired as of December 31, 2010.



F-86



---

##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The table below shows instruments of this type in place at December 31, 2010:



|                                             |  |                                                         |     |  |      |  |     |                                                    |  |  |                                                    |  |  |      |     |  |       |  |     |           |  |  |                |  |  |           |     |   |                |  |     |           |  |  |                             |  |  |  |     |  |  |  |     |  |  |  |   | 
|-------------------------------------------- |  | ------------------------------------------------------- | --- |  | ---- |  | --- | -------------------------------------------------- |  |  | -------------------------------------------------- |  |  | ---- | --- |  | ----- |  | --- | --------- |  |  | -------------- |  |  | --------- | --- | - | -------------- |  | --- | --------- |  |  | --------------------------- |  |  |  | --- |  |  |  | --- |  |  |  | - | 
|                                             |  | Notional amounts by expiry date as of December 31, 2010 |     |  |      |  |     | Of which derivativesdesignated as fairvalue hedges |  |  | Of which derivativesdesignated as cash flow hedges | 
|( million)                                  |  | 2011                                                    |     |  | 2012 |  |     | 2013                                               |  |  | 2015                                               |  |  | 2016 |     |  | Total |  |     | Fairvalue |  |  | Notionalamount |  |  | Fairvalue |     |   | Notionalamount |  |     | Fairvalue |  |  | Of whichrecognizedin equity | 
|Interest rate swaps                          |  |                                                         |     |  |      |  |     |                                                    |  |  |                                                    |  |  |      |     |  |       |  |     |           |  |  |                |  |  |           |     |   |                |  |     |           |  |  |                             |  |  |  |     |  |  |  |     |  |  |  |   | 
|pay floating(1)/ receive 2.73%               |  |                                                         |    |  |      |  |    |                                                    |  |  |                                                   |  |  |      |    |  |       |  | 500 |           |  |  | 500            |  |  |           | 12  |   |                |  | 500 |           |  |  | 12                          |  |  |  |    |  |  |  |    |  |  |  |  | 
|Cross currency Swaps                         |  |                                                         |     |  |      |  |     |                                                    |  |  |                                                    |  |  |      |     |  |       |  |     |           |  |  |                |  |  |           |     |   |                |  |     |           |  |  |                             |  |  |  |     |  |  |  |     |  |  |  |   | 
| pay  floating(2)/ receive JPY floating(3) |  |                                                         |    |  |      |  |    |                                                    |  |  | 92                                                 |  |  |      |    |  |       |  |    |           |  |  | 92             |  |  |           | 47  |   |                |  |    |           |  |  |                            |  |  |  |    |  |  |  |    |  |  |  |  | 
| pay 4.89% / receive CHF 3.26%             |  |                                                         |    |  |      |  | 180 |                                                    |  |  |                                                   |  |  |      |    |  |       |  |    |           |  |  | 180            |  |  |           | 41  |   |                |  |    |           |  |  |                            |  |  |  | 180 |  |  |  | 41  |  |  |  | 1 | 
| pay  4.87% / receive CHF 3.38%            |  |                                                         |    |  |      |  |    |                                                    |  |  |                                                   |  |  |      | 244 |  |       |  |    |           |  |  | 244            |  |  |           | 82  |   |                |  |    |           |  |  |                            |  |  |  | 244 |  |  |  | 82  |  |  |  | 6 | 
| pay  floating(2)/ receive CHF 3.26%       |  |                                                         |    |  |      |  | 167 |                                                    |  |  |                                                   |  |  |      |    |  |       |  |    |           |  |  | 167            |  |  |           | 38  |   |                |  | 167 |           |  |  | 38                          |  |  |  |    |  |  |  |    |  |  |  |  | 
|Currency swaps                               |  |                                                         |     |  |      |  |     |                                                    |  |  |                                                    |  |  |      |     |  |       |  |     |           |  |  |                |  |  |           |     |   |                |  |     |           |  |  |                             |  |  |  |     |  |  |  |     |  |  |  |   | 
| pay / receive USD(4)                      |  |                                                         | 489 |  |      |  |    |                                                    |  |  |                                                   |  |  |      |    |  |       |  |    |           |  |  | 489            |  |  |           | (2  | ) |                |  |    |           |  |  |                            |  |  |  |    |  |  |  |    |  |  |  |  | 
|Total                                        |  |                                                         | 489 |  |      |  | 347 |                                                    |  |  | 92                                                 |  |  |      | 244 |  |       |  | 500 |           |  |  | 1,672          |  |  |           | 218 |   |                |  | 667 |           |  |  | 50                          |  |  |  | 424 |  |  |  | 123 |  |  |  | 7 | 



|(1) | Floating: benchmark rate 1-month Euribor
|--- | ----------------------------------------

|(2) | Floating: benchmark rate 3-month Euribor
|--- | ----------------------------------------

|(3) | Floating: benchmark rate 3-month Libor JPY
|--- | ------------------------------------------

|(4) | Swaps on U.S. commercial paper
|--- | ------------------------------



The table below shows instruments of this type in place at
December 31, 2009:



|                                             |  |                                                         |       |  |      |  |     |                                                    |  |  |                                                   |  |  |       |     |  |           |  |       |                |  |  |           |   |  |                |       |  |           |  |     |                             |  |  |     |  |  |  |    |  |  |  |    |  
|-------------------------------------------- |  | ------------------------------------------------------- | ----- |  | ---- |  | --- | -------------------------------------------------- |  |  | ------------------------------------------------- |  |  | ----- | --- |  | --------- |  | ----- | -------------- |  |  | --------- | - |  | -------------- | ----- |  | --------- |  | --- | --------------------------- |  |  | --- |  |  |  | -- |  |  |  | -- | -
|                                             |  | Notional amounts by expiry date
as of December 31, 2009 |       |  |      |  |     | Of which derivativesdesignated as fairvalue hedges |  |  | Of which derivativesdesignated ascash flow hedges | 
|( million)                                  |  | 2010                                                    |       |  | 2012 |  |     | 2013                                               |  |  | 2015                                              |  |  | Total |     |  | Fairvalue |  |       | Notionalamount |  |  | Fairvalue |   |  | Notionalamount |       |  | Fairvalue |  |     | Of whichrecognizedin equity | 
|Interest rate swaps                          |  |                                                         |       |  |      |  |     |                                                    |  |  |                                                   |  |  |       |     |  |           |  |       |                |  |  |           |   |  |                |       |  |           |  |     |                             |  |  |     |  |  |  |    |  |  |  |    |  
|Pay floating(1)/ receive 1.27%               |  |                                                         | 1,000 |  |      |  |    |                                                    |  |  |                                                  |  |  |       |    |  |           |  | 1,000 |                |  |  | 2         |   |  |                | 1,000 |  |           |  | 2   |                             |  |  |    |  |  |  |   |  |  |  |   |  
|Cross currency swaps                         |  |                                                         |       |  |      |  |     |                                                    |  |  |                                                   |  |  |       |     |  |           |  |       |                |  |  |           |   |  |                |       |  |           |  |     |                             |  |  |     |  |  |  |    |  |  |  |    |  
| pay 
floating(2)/ receive £
5.50%         |  |                                                         | 299   |  |      |  |    |                                                    |  |  |                                                  |  |  |       |    |  |           |  | 299   |                |  |  | (62       | ) |  |                | 299   |  |           |  | (62 | )                           |  |  |    |  |  |  |   |  |  |  |   |  
| pay 
floating(2)/ receive JPY floating(3) |  |                                                         |      |  |      |  |    |                                                    |  |  | 92                                                |  |  |       |    |  |           |  | 92    |                |  |  | 21        |   |  |                |      |  |           |  |    |                             |  |  |    |  |  |  |   |  |  |  |   |  
| pay  floating(4)/ receive CHF 2.75%       |  |                                                         | 122   |  |      |  |    |                                                    |  |  |                                                  |  |  |       |    |  |           |  | 122   |                |  |  | 16        |   |  |                | 122   |  |           |  | 16  |                             |  |  |    |  |  |  |   |  |  |  |   |  
| pay  4.89% / receive CHF 3.26%            |  |                                                         |      |  |      |  | 180 |                                                    |  |  |                                                  |  |  |       |    |  |           |  | 180   |                |  |  | 3         |   |  |                |      |  |           |  |    |                             |  |  | 180 |  |  |  | 3  |  |  |  | (2 | )
| pay  4.87% / receive CHF 3.38%            |  |                                                         |      |  |      |  |    |                                                    |  |  |                                                  |  |  |       | 244 |  |           |  | 244   |                |  |  | 23        |   |  |                |      |  |           |  |    |                             |  |  | 244 |  |  |  | 23 |  |  |  | (2 | )
| pay  floating(2)/ receive CHF 3.26%       |  |                                                         |      |  |      |  | 167 |                                                    |  |  |                                                  |  |  |       |    |  |           |  | 167   |                |  |  | 4         |   |  |                | 167   |  |           |  | 4   |                             |  |  |    |  |  |  |   |  |  |  |   |  
|Total                                        |  |                                                         | 1,421 |  |      |  | 347 |                                                    |  |  | 92                                                |  |  |       | 244 |  |           |  | 2,104 |                |  |  | 7         |   |  |                | 1,588 |  |           |  | (40 | )                           |  |  | 424 |  |  |  | 26 |  |  |  | (4 | )



|(1) | Floating: benchmark rate 1-month Euribor
|--- | ----------------------------------------

|(2) | Floating: benchmark rate 3-month Euribor
|--- | ----------------------------------------

|(3) | Floating: benchmark rate 3-month Libor JPY
|--- | ------------------------------------------

|(4) | Floating: benchmark rate 6-month Euribor
|--- | ----------------------------------------



F-87



---

##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The table below shows instruments of this type in place at December 31, 2008:



|                                             |  |                                                        |     |  |      |  |       |                                                    |  |  |                                                    |  |  |      |    |  |       |  |     |           |  |  |                |  |  |           |     |   |                |  |     |           |  |  |                             |   |  |  |       |  |  |  |     |   |  |  |     |  
|-------------------------------------------- |  | ------------------------------------------------------ | --- |  | ---- |  | ----- | -------------------------------------------------- |  |  | -------------------------------------------------- |  |  | ---- | -- |  | ----- |  | --- | --------- |  |  | -------------- |  |  | --------- | --- | - | -------------- |  | --- | --------- |  |  | --------------------------- | - |  |  | ----- |  |  |  | --- | - |  |  | --- | -
|                                             |  | Notional amounts by expiry date asof December 31, 2008 |     |  |      |  |       | Of which derivativesdesignated as fairvalue hedges |  |  | Of which derivativesdesignated as cash flow hedges | 
|( million)                                  |  | 2009                                                   |     |  | 2010 |  |       | 2012                                               |  |  | 2013                                               |  |  | 2015 |    |  | Total |  |     | Fairvalue |  |  | Notionalamount |  |  | Fairvalue |     |   | Notionalamount |  |     | Fairvalue |  |  | Of whichrecognizedin equity |  
|Interest rate swaps                          |  |                                                        |     |  |      |  |       |                                                    |  |  |                                                    |  |  |      |    |  |       |  |     |           |  |  |                |  |  |           |     |   |                |  |     |           |  |  |                             |   |  |  |       |  |  |  |     |   |  |  |     |  
|Pay  3.69% / receive  floating(1)          |  |                                                        |    |  |      |  | 1,000 |                                                    |  |  |                                                   |  |  |      |   |  |       |  |    |           |  |  | 1,000          |  |  |           | (12 | ) |                |  |    |           |  |  |                            |   |  |  | 1,000 |  |  |  | (12 | ) |  |  | (14 | )
|Cross currency swaps                         |  |                                                        |     |  |      |  |       |                                                    |  |  |                                                    |  |  |      |    |  |       |  |     |           |  |  |                |  |  |           |     |   |                |  |     |           |  |  |                             |   |  |  |       |  |  |  |     |   |  |  |     |  
| pay floating(1)/receive £
5.50%           |  |                                                        |    |  |      |  | 299   |                                                    |  |  |                                                   |  |  |      |   |  |       |  |    |           |  |  | 299            |  |  |           | (74 | ) |                |  | 299 |           |  |  | (74                         | ) |  |  |      |  |  |  |    |   |  |  |    |  
| pay floating(1)/receive JPY 0.22%         |  |                                                        | 116 |  |      |  |      |                                                    |  |  |                                                   |  |  |      |   |  |       |  |    |           |  |  | 116            |  |  |           | 33  |   |                |  | 116 |           |  |  | 33                          |   |  |  |      |  |  |  |    |   |  |  |    |  
| pay 
floating(1)/ receive JPY floating(2) |  |                                                        |    |  |      |  |      |                                                    |  |  |                                                   |  |  |      | 92 |  |       |  |    |           |  |  | 92             |  |  |           | 27  |   |                |  |    |           |  |  |                            |   |  |  |      |  |  |  |    |   |  |  |    |  
| pay  floating(3)/ receive CHF 2.75%       |  |                                                        |    |  |      |  | 122   |                                                    |  |  |                                                   |  |  |      |   |  |       |  |    |           |  |  | 122            |  |  |           | 16  |   |                |  | 122 |           |  |  | 16                          |   |  |  |      |  |  |  |    |   |  |  |    |  
| pay  4.89% / receive CHF 3.26%            |  |                                                        |    |  |      |  |      |                                                    |  |  | 180                                                |  |  |      |   |  |       |  |    |           |  |  | 180            |  |  |           | 5   |   |                |  |    |           |  |  |                            |   |  |  | 180   |  |  |  | 5   |   |  |  |    |  
| pay  4.87% / receive CHF 3.38%            |  |                                                        |    |  |      |  |      |                                                    |  |  |                                                   |  |  |      |   |  |       |  | 244 |           |  |  | 244            |  |  |           | 23  |   |                |  |    |           |  |  |                            |   |  |  | 244   |  |  |  | 23  |   |  |  | (1  | )
|Currency swaps                               |  |                                                        |     |  |      |  |       |                                                    |  |  |                                                    |  |  |      |    |  |       |  |     |           |  |  |                |  |  |           |     |   |                |  |     |           |  |  |                             |   |  |  |       |  |  |  |     |   |  |  |     |  
| pay / receive USD(4)                      |  |                                                        | 718 |  |      |  |      |                                                    |  |  |                                                   |  |  |      |   |  |       |  |    |           |  |  | 718            |  |  |           | (40 | ) |                |  |    |           |  |  |                            |   |  |  |      |  |  |  |    |   |  |  |    |  
|Total                                        |  |                                                        | 834 |  |      |  | 1,421 |                                                    |  |  | 180                                                |  |  |      | 92 |  |       |  | 244 |           |  |  | 2,771          |  |  |           | (22 | ) |                |  | 537 |           |  |  | (25                         | ) |  |  | 1,424 |  |  |  | 16  |   |  |  | (15 | )



|(1) | Floating: benchmark rate 3-month Euribor
|--- | ----------------------------------------

|(2) | Floating: benchmark rate 3-month Libor JPY
|--- | ------------------------------------------

|(3) | Floating: benchmark rate 6-month Euribor
|--- | ----------------------------------------

|(4) | Swaps on U.S. commercial paper
|--- | ------------------------------



The change in the structure of the Groups debt arising
from these financial instruments is described in Note D.17., which also includes an analysis of the Groups sensitivity to interest rates.



D.20.2. Equity derivatives



The Group did not hold any equity derivatives as of December 31, 2010, December 31, 2009 or December 31, 2008.



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



D.21. Off balance sheet commitments



D.21.1. Off balance sheet commitments relating to operating activities



The Groups off balance sheet commitments (excluding
Merial, see Note D.8.1.) comprise:



|                                              |  |                        |       |   |             |  |       |                  |  |  |                  |   |  |             |     |   |  |  |       |  
|--------------------------------------------- |  | ---------------------- | ----- | - | ----------- |  | ----- | ---------------- |  |  | ---------------- | - |  | ----------- | --- | - |  |  | ----- | -
|December 31, 2010                             |  | Payments due by period |      
|( million)                                   |  | Total                  |       |   | Under1 year |  |       | From 1 to 3years |  |  | From 3 to 5years |   |  | Over 5years |    
| Operating lease obligations                 |  |                        | 1,291 |   |             |  | 260   |                  |  |  | 337              |   |  |             | 217 |   |  |  | 477   |  
| Irrevocable purchase commitments(1)         |  |                        |       |   |             |  |       |                  |  |  |                  |   |  |             |     |   |  |  |       |  
| given                                       |  |                        | 2,658 |   |             |  | 1,566 |                  |  |  | 498              |   |  |             | 207 |   |  |  | 387   |  
| received                                    |  |                        | (176  | ) |             |  | (74   | )                |  |  | (35              | ) |  |             | (16 | ) |  |  | (51   | )
| Research and development license agreements |  |                        |       |   |             |  |       |                  |  |  |                  |   |  |             |     |   |  |  |       |  
| future service commitments(2)               |  |                        | 1,073 |   |             |  | 199   |                  |  |  | 312              |   |  |             | 252 |   |  |  | 310   |  
| potential milestone payments(3)             |  |                        | 2,015 |   |             |  | 101   |                  |  |  | 378              |   |  |             | 238 |   |  |  | 1,298 |  
|Total                                         |  |                        | 6,861 |   |             |  | 2,052 |                  |  |  | 1,490            |   |  |             | 898 |   |  |  | 2,421 |  



|(1) | These comprise irrevocable commitments to suppliers of (i) property, plant
and equipment, net of down payments (see Note D.3.) and (ii) goods and services.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Future service commitments relating to research and development license
agreements mainly comprise research financing commitments, but also include consideration for access to technologies.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | This line includes all potential milestone payments on projects regarded as
reasonably possible, i.e. on projects in the development phase. Payments contingent upon the attainment of sales targets once a product is on the market are excluded.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Operating leases



Sanofi-aventis leases certain of its properties and
equipment used in the ordinary course of business under operating leases. Future minimum lease payments due under non-cancelable operating leases at December 31, 2010 amounted to 1,291 million (1,197 million at
December 31, 2009; 1,192 million at December 31, 2008).



Total rental expense recognized in the year ended December 31, 2010 was 264 million (273 million in the year ended December 31, 2009; 282 million in the year
ended December 31, 2008).



Research and development
license agreements



In pursuance of its
strategy, sanofi-aventis may acquire technologies and rights to products. Such acquisitions may be made in various contractual forms: acquisitions of shares, loans, license agreements, joint development, and co-marketing. These contracts usually
involve upfront payments on signature of the agreement, development milestone payments, and royalties. Some of these complex agreements include undertakings to finance research programs in future years and payments contingent upon specified
development milestones, the granting of approvals or licenses, or the attainment of sales targets once a product is on the market.



The item Research and development license agreements comprises future service commitments to finance research and development
or technology, and potential milestone payments regarded as reasonably possible (i.e. all potential milestone payments relating to projects in the development phase). This item excludes projects in the research phase (4.1 billion in 2010) and
payments contingent upon the attainment of sales targets once a product is on the market (3.3 billion in 2010).



The main collaboration agreements relating to development projects in the Pharmaceuticals segment are described below. Potential milestone
payments relating to development projects under these agreements amounted to 1.4 billion in 2010.



| |  |  | In June 2010, sanofi-aventis and Metabolex signed a global license agreement for MBX-2982, an oral agent for the treatment of type 2 diabetes.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In May 2010, sanofi-aventis signed a license agreement with Glenmark Pharmaceuticals S.A. (GPSA), a wholly-owned subsidiary of Glenmark Pharmaceuticals
Limited India (GLP).
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



| |  |  | In April 2010, sanofi-aventis signed a global license agreement with CureDM Group Holdings, LLC (CureDM) for PancreateTM, a novel human peptide which could restore a patients ability
to produce insulin and other pancreatic hormones in both type 1 and type 2 diabetes.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In December 2009, sanofi-aventis and the U.S. biotechnology company Alopexx Pharmaceuticals (LLC) simultaneously signed (i) a collaboration
agreement, and (ii) an option for a license on an antibody for the prevention and treatment of infections originating in the bacterium that causes plague and other serious infections.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | End September 2009, sanofi-aventis and Merrimack Pharmaceuticals Inc. signed an exclusive global licensing and collaboration agreement covering the
MM-121 molecule for the management of solid malignancies.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In May 2009, sanofi-aventis signed a global license agreement with Exelixis, Inc. for XL147 and XL765, and simultaneously signed an exclusive research
collaboration agreement for the discovery of inhibitors of Phosphoinositide-3-Kinase (PI3K) for the management of malignant tumors.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In September 2003, sanofi-aventis signed a collaboration agreement in oncology with Regeneron Pharmaceuticals, Inc. (Regeneron) to develop the Vascular
Endothelial Growth Factor (VEGF) Trap program. Sanofi-aventis will pay 100% of the development costs of the VEGF Trap. Once a VEGF Trap product starts to be marketed, Regeneron will repay 50% of the development costs (originally paid by
sanofi-aventis) in accordance with a formula based on Regenerons share of the profits.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | In November 2007, sanofi-aventis signed a collaboration agreement with Regeneron to discover, develop and commercialize fully-human therapeutic
antibodies. This agreement was broadened, and its term extended, on November 10, 2009. Under the terms of the development agreement, sanofi-aventis committed to fund 100% of the development costs of Regenerons antibody research program
until 2017. Once a product begins to be marketed, Regeneron will repay out of its profits (provided they are sufficient) half of the development costs borne by sanofi-aventis.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Sanofi-aventis has also entered into the following major
agreements, which are currently in a less advanced research phase:



| |  |  | December 2010: a global licensing and patent transfer agreement with Ascendis Pharma (Ascendis) on the proprietary Transcon Linker and Hydrogel Carrier
technology developed by Ascendis for precise, time-controlled release of therapeutic active ingredients into the body. The agreement will enable sanofi-aventis to develop, manufacture and commercialize products combining this technology with active
molecules for the treatment of diabetes and related disorders.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | December 2010: alliance with Avila TherapeuticsTMInc. (Avila) to discover target covalent drugs for the treatment of cancers, directed towards six signaling proteins
that are critical in tumor cells. Under the terms of the agreement, sanofi-aventis will have access to Avilas proprietary AvilomicsTMplatform offering protein silencing for these pathogenic proteins.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | December 2010: an exclusive global licensing option with Oxford BioTherapeutics for three existing antibodies, plus a research and collaboration
agreement to discover and validate new targets in oncology.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | September 2010: alliance with the Belfer Institute of Applied Cancer Science at the Dana-Farber Cancer Institute (DFCI) to identify novel targets in
oncology for the development of new therapeutic agents directed towards these targets and their associated biomarkers. Under the terms of the agreement, sanofi-aventis will have access to the Belfer Institutes anticancer target identification
and validation platform and to its translational medicine resources. Sanofi-aventis also has an option over an exclusive license to develop, manufacture and commercialize novel molecules directed towards the targets identified and validated under
this research collaboration.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | June 2010: alliance with Regulus Therapeutics Inc. to discover, develop and commercialize novel micro-RNA therapeutics, initially in fibrosis.
Sanofi-aventis also received an option, which if exercised, would provide access to the technology to develop and commercialize other micro-RNA based therapeutics, beyond the first four targets.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



| |  |  | June 2010: exclusive global collaboration and license agreement with Ascenta Therapeutics, a U.S. biopharmaceutical company, on a number of molecules
that could restore apoptosis (cell death) in tumor cells.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | October 2009: agreement with Micromet, Inc. to develop a BiTE® antibody against a tumor antigen present at the surface of carcinoma cells.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | May 2009: collaboration and licensing agreement with Kyowa Hakko Kirin Co., Ltd., under which sanofi-aventis obtained the worldwide rights to the
anti-LIGHT fully human monoclonal antibody. This anti-LIGHT antibody is presently at preclinical development stage, and is expected to be first-in-class in the treatment of ulcerative colitis and Crohns disease.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Sanofi Pasteur has entered into a number of collaboration
agreements. Milestone payments relating to development projects under those agreements amounted to 0.3 billion in 2010.



In December 2009, sanofi pasteur signed a donation letter to the World Health Organization (WHO). The terms of the agreement committed
sanofi pasteur to donate 10% of its future output of vaccines against A(H1N1), A(H5N1) or any other influenza strain with pandemic potential, up to a maximum of 100 million doses. Since this agreement was put in place, sanofi pasteur has
already donated to the WHO some of the doses covered by the commitment.



D.21.2. Off balance sheet commitments related to the financing of the Group



Credit facilities



The table below shows undrawn credit facilities by maturity:



|                                                                               |  |                                |        |  |             |  |        |                  |  |  |                  |  |  |             |       |  |  |  |   | 
|------------------------------------------------------------------------------ |  | ------------------------------ | ------ |  | ----------- |  | ------ | ---------------- |  |  | ---------------- |  |  | ----------- | ----- |  |  |  | - | 
|December 31, 2010                                                              |  | Undrawn amounts by expiry date |       
|( million)                                                                    |  | Total                          |        |  | Under1 year |  |        | From 1 to3 years |  |  | From 3 to 5years |  |  | Over 5years |      
|General-purpose facilities                                                     |  |                                | 12,238 |  |             |  | 245    |                  |  |  | 5,755            |  |  |             | 6,238 |  |  |  |  | 
|Acquisition facilities available in connection with the Genzyme acquisition(1) |  |                                | 11,226 |  |             |  | 11,226 |                  |  |  |                 |  |  |             |      |  |  |  |  | 
|Total                                                                          |  |                                | 23,464 |  |             |  | 11,471 |                  |  |  | 5,755            |  |  |             | 6,238 |  |  |  |  | 



|(1) | The maturities shown reflect the latest possible drawdown date of each facility
(see Note D.17.).
|--- | -------------------------------------------------------------------------------------------------



Guarantees



Guarantees given and received (mainly
surety bonds) are as follows:



|                    |  |      |       |   |      |  |       |      |  |  |       |  
|------------------- |  | ---- | ----- | - | ---- |  | ----- | ---- |  |  | ----- | -
|( million)         |  | 2010 |       |   | 2009 |  |       | 2008 | 
|Guarantees given    |  |      | 2,558 |   |      |  | 2,358 |      |  |  | 1,524 |  
|Guarantees received |  |      | (185  | ) |      |  | (171  | )    |  |  | (218  | )



D.21.3. Off balance sheet commitments relating to the scope of consolidation



Merial



On March 8, 2010, sanofi-aventis exercised its
contractual right to combine Merial with Intervet/Schering-Plough, Mercks animal health business, to form a new joint venture equally owned by Merck and sanofi-aventis. Formation of the new joint venture is subject to signature of final
agreements, antitrust review in the United States, Europe and other countries, and other customary closing conditions. Merial and Intervet/Schering-Plough will continue to operate independently until closing of the transaction, which is expected to
take place during 2011. Sanofi-aventis will be required to make a true-up payment of $250 million to Merck to establish parity in the joint venture, in addition to the $750 million payment stipulated in the agreement signed on July 29, 2009.



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



For a description of the treatment of Merial in the consolidated financial statements of
sanofi-aventis for the year ended December 31, 2010, refer to Note D.8.1.



Genzyme



On January 24, 2011, sanofi-aventis extended to February 15, 2011 its tender offer for all outstanding shares of common stock of Genzyme Corporation at $69.00 per share, net to the seller in
cash, without interest and less any required withholding taxes. The offer amounts to approximately $18.5 billion. The tender offer was originally made on October 4, 2010, and was initially due to expire on December 10, 2010.



BMP Sunstone



On October 28, 2010, sanofi-aventis and BMP Sunstone
Corporation signed an agreement under which sanofi-aventis was to acquire BMP Sunstone for $10.00 per share in cash, equivalent to a total consideration of $520.6 million on a fully-diluted basis. Under the terms of the agreement, BMP Sunstone would
be merged into a wholly-owned subsidiary of sanofi-aventis. This acquisition would enable sanofi-aventis to reinforce its consumer health operations in China, building on BMP Sunstones substantial positions in coughs, colds, and womens
health.



Closing of this transaction is expected
in February 2011.



For disclosures about the
maximum amount of contingent consideration payable in connection with completed business combinations, refer to Note D.18.



D.22. Legal and Arbitral Proceedings



Sanofi-aventis and its affiliates are involved in litigation, arbitration and other legal proceedings. These proceedings typically are
related to product liability claims, intellectual property rights (particularly claims against generic companies seeking to limit the patent protection of sanofi-aventis products), competition law and trade practices, commercial claims, employment
and wrongful discharge claims, tax assessment claims, waste disposal and pollution claims, and claims under warranties or indemnification arrangements relating to business divestitures. Provisions related to legal and arbitral proceedings are
recorded in accordance with the principles described in Note B.12.



Most of the issues raised by these claims are highly complex and subject to substantial uncertainties; therefore, the probability of loss and an estimation of damages are difficult to ascertain.
Consequently, for a majority of these claims, we are unable to make a reasonable estimate of the expected financial effect that will result from ultimate resolution of the proceeding. In those cases, we have not accrued a reserve for the potential
outcome, but disclose information with respect to the nature of the contingency.



In the cases that have been settled or adjudicated, or where quantifiable fines and penalties have been assessed, we have indicated our losses or the amount of provision accrued that is the estimate of
the probable loss.



In a limited number of ongoing
cases, while we are able to make a reasonable estimate of the expected loss or range of the possible loss and have accrued a provision for such loss, we believe that publication of this information on a case-by-case basis or by class would seriously
prejudice the Companys position in the ongoing legal proceedings or in any related settlement discussions. Accordingly, in those cases, we have disclosed information with respect to the nature of the contingency but have not disclosed our
estimate of the range of potential loss, in accordance with paragraph 92 of IAS 37.



These assessments can involve a series of complex judgments about future events and can rely heavily on estimates and assumptions. Our assessments are based on estimates and assumptions that have been
deemed reasonable by management. We believe that the aggregate provisions recorded for the above matters are adequate



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



based upon currently available information. However, given the inherent uncertainties related to these cases and involved in estimating contingent liabilities, we could in the future incur
judgments that could have a material adverse effect on our net income in any particular period.



Long term provisions other than provisions for pensions and other long-term benefits and restructuring provisions are disclosed in Note D.19.3.



| |  |  | Provisions for product liability risks, litigation and other amount to 951 million in 2010. These provisions are mainly related to product
liabilities, government investigations, competition law, regulatory claims, warranties in connection with certain contingent liabilities arising from business divestitures other than environmental matters and other claims.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Provisions for environmental risks and remediation amount to 781 million in 2010, the majority of which are related to contingencies that
have arisen from business divestitures.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



When a legal claim involves a challenge to the patent protection of a pharmaceutical product, the principal risk to sanofi-aventis is that the sales of the product might decline following the introduction
of a competing generic product in the relevant market. In cases where the product rights have been capitalized as an asset on the balance sheet (i.e., assets acquired through a separate acquisition or through a business combination  see
Note B.4.), such a decline in sales could negatively affect the value of the intangible asset. In those cases, the Company performs impairment tests in accordance with the principles disclosed in Note B.6.1., based upon the best available
information and, where appropriate, records an impairment loss to reduce the carrying amount of the related intangible asset to its estimated fair value. The amounts of such impairments are disclosed in Note D.5.



The principal ongoing legal and arbitral proceedings are
described below:



a) Products



  Sanofi Pasteur Hepatitis B Vaccine Product Litigation



Since 1996, more than 180 lawsuits have been
filed in various French civil courts against Sanofi Pasteur SA and/or Sanofi Pasteur MSD S.N.C., the former French subsidiary of sanofi-aventis, and the latter a joint-venture company with Merck & Co., Inc. In such lawsuits, the plaintiffs
allege that they suffer from a variety of neurological disorders and autoimmune diseases, including multiple sclerosis and Guillain-Barré syndrome as a result of receiving the hepatitis B vaccine. The French Supreme Court (Cour de
Cassation), in July 2009, upheld a decision of the Court of Appeal of Lyon ordering Sanofi Pasteur MSD S.N.C. to pay damages of 120,000 to a claimant whose multiple sclerosis appeared shortly after her vaccination against the hepatitis B
virus; however, in September 2009 and in November 2010, the Cour de Cassation upheld decisions of the Court of Appeal of Metz and Paris respectively, rejecting claims alleging such causal link. Nevertheless, it is difficult to provide an opinion on
the evolution and final outcome of these cases. A number of claims remain to be adjudicated and there can be no assurance that cases decided to date will be representative of future decisions and that additional claims will not be filed in France or
other countries.



In January 2008, both the
legal entity Sanofi Pasteur MSD S.N.C., and a corporate officer of this company, as well as a former corporate officer of Sanofi Pasteur S.A., were placed under investigation in an ongoing criminal inquiry in France relating to alleged side effects
caused by the hepatitis B vaccine.



  Sanofi
Pasteur Inc. Thimerosal Product Litigation



Since early 2001, Sanofi Pasteur Inc., a U.S. subsidiary of sanofi-aventis, has been a defendant in lawsuits filed in several federal and
state courts in the United States alleging that serious personal injuries resulted from the presence of mercury in the preservative thimerosal, trace amounts of which are contained in vaccines manufactured by Sanofi Pasteur Inc.



Currently, there are 172 such cases pending. Several of the
cases seek certification to proceed as class actions.



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Sanofi Pasteur Inc. believes that under U.S. law, all of these claims must first be
filed in the U.S. Court of Federal Claims to determine whether the claim qualifies for compensation by the National Vaccine Injury Compensation Program (VICP) before the claimants may bring direct actions against the company. The U.S. Court of
Federal Claims (Claims Court) has established a process designed to facilitate the handling of the almost 5,000 thimerosal claims within the VICP. The process involves a committee of petitioners representatives and representatives of the U.S.
Department of Justice, who represent the government in the VICP. As originally planned, the process called for petitioners representatives to designate three test cases in each of the three different theories of general causation
advanced by the petitioners. Hearings on two of the theories were completed in 2007 and 2008 and the petitioners decided that there was no need to proceed with the last theory.



In 2010, the U.S. Court of Appeals for the Federal Circuit
affirmed the 2009 decisions of the U.S. Court of Federal Claims, in the test cases under the first of the two causation theories, which held that the petitioners failed to establish that their claimed injuries were caused by thimerosal-containing
vaccines and the MMR vaccine, and no compensation was awarded to any of them under the VICP. The petitioners may choose to file civil actions against the manufacturers.



In March 2010, in the test cases under the second of the two
causation theories, concerning vaccines containing only thimerosal, the U.S. Court of Federal Claims held that the petitioners failed to establish that their claimed injuries were caused by thimerosal-containing vaccines, and no compensation was
awarded to any of the petitioners under the VICP. The petitioners chose not to seek re-hearings on these cases, but instead have filed elections to file civil actions against the manufacturers.



The remainder of the 172 cases are either in the preliminary
response stage, in the discovery process, have been stayed pending adjudication by the Claims Court, or have pending plaintiffs requests for reconsideration of preliminary determinations to stay proceedings pending such adjudication by the
Claims Court.



  Agreal® Product Litigation



The Group faces administrative, criminal, and civil claims involving several hundred claimants, primarily in Spain,
from women alleging that the menopause treatment Agreal® (veralipride) has caused a range of neurological and
psychological harm. In the majority of the civil cases to date, the decisions have been favorable to sanofi-aventis, generally on the basis of a finding that causation was not proven by the claimants and/or that the leaflet gave adequate notice of
potential side effects. A small number of the civil cases have been decided adversely to sanofi-aventis and sanofi-aventis has appealed each of these. The Administrative Court decisions (approximately 60 resolutions), issued in 2009 and
2010, have dismissed all these administrative claims. All the criminal actions submitted have been dismissed to date. Any amounts awarded to date have not been material to the Group on a consolidated basis. A number of claims remain to be
adjudicated and there can be no assurance that cases decided to date will be representative of future decisions and that additional claims will not be filed in Spain or other countries.



In France approximately 85 claimants have filed a motion (référé) in order to
appoint one or more expert(s) to conduct certain studies, in particular, concerning the alleged injury and causal link with the ingestion of the medication concerned. A hearing before the First Instance Court (Tribunal de Grande Instance) is
scheduled to be held in February 2011.



  Plavix® Product Litigation



Affiliates of the Group and Bristol-Myers Squibb are named in a number of individual actions seeking recovery under
state law for personal injuries allegedly sustained in connection with the use of Plavix®. The actions are
primarily venued in the U.S. District Court for the District of New Jersey, which had administratively stayed the proceedings pending a U.S. Supreme Court decision in the Levine case (which presented issues of federal preemption relevant to state
law claims). Following the March 2009 decision rendered by the U.S. Supreme Court in this case, 23 of these cases were reactivated, while a tolling agreement (agreement which tolls



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or suspends the running of the statute of limitations) remains in effect for additional potential plaintiffs. On October 15, 2010, an action involving multiple plaintiffs was filed in Saint
Clair County, Illinois State Court, and was subsequently removed to the U.S. District Court of Illinois. This action is not subject to the above-referenced tolling agreement.



b) Patents



  Plavix® Patent Litigation



United States.On March 21, 2002, sanofi-aventis, Sanofi-Synthélabo Inc. and Bristol-Myers Squibb
Sanofi Pharmaceuticals Holding Partnership (or BMS Sanofi Holding, our partnership with Bristol-Myers Squibb) filed suit in the U.S. District Court for the Southern District of New York against Apotex Inc. and Apotex Corp. (hereinafter
Apotex) for the infringement of U.S. patent rights relating to Plavix® as a result of an ANDA filed
by Apotex including a Paragraph IV challenge to U.S. Patent No. 4,847,265 (the  265 Patent), expiring in 2011, which discloses and claims inter alia the clopidogrel bisulfate compound, the active ingredient in Plavix®. Apotex asserted antitrust counterclaims.



On January 24, 2006, sanofi-aventis learned that the FDA
had granted final approval to the Apotex ANDA.



Following unsuccessful efforts by sanofi-aventis, Bristol-Myers Squibb and Apotex to settle the patent infringement lawsuit, on August 8, 2006, Apotex announced the launch at risk of its
generic product in the United States. Apotex was enjoined from further marketing and sale of its generic product on August 31, 2006. After extensive litigation, the Federal Circuit Court of Appeals decision to uphold the lower U.S. District
Court ruling upholding the validity and enforceability of the principal Plavix® patent was confirmed in November
2009, when the U.S. Supreme Court declined to hear the petition by Apotex in the Plavix® patent litigation.



Pursuant to Apotexs request for a
reexamination of the 265 Patent, in March 2010, the USPTO concluded that all of the original claims were patentable. In October 2010, the USPTO denied Apotexs request for a second reexamination.



In parallel, sanofi-aventis and
Bristol-Myers Squibb are seeking damages from Apotex, in reparation of harm caused by that companys at risk marketing and sale of an infringing generic version of Plavix® in 2006. In October 2010, the U.S. District Court awarded sanofi-aventis and Bristol-Myers Squibb damages in the amount of $442,209,362, plus $107,930,857 in
pre-judgment interest, as well as costs and post-judgment interest as set by statute. Apotex has secured the amount of the award by cash deposit and has filed a notice of appeal. The appeal will likely be decided in 2011.



Australia. On August 17, 2007, GenRX, a
subsidiary of Apotex obtained registration of a generic clopidogrel bisulfate product on the Australian Register of Therapeutic Goods and sent notice to sanofi-aventis that it had in parallel applied to the Federal Court of Australia for an order
revoking the Australian enantiomer patent claiming clopidogrel salts. On September 21, 2007, sanofi-aventis obtained a preliminary injunction from the Federal Court preventing commercial launch of this generic clopidogrel bisulfate product
until judgment on the substantive issues of patent validity and infringement. In February 2008, Spirit Pharmaceuticals Pty. Ltd. also introduced a nullity action against the Australian enantiomer patent. The Spirit proceeding was consolidated with
the Apotex proceeding.



On August 12, 2008,
the Australian Federal Court confirmed that the claim directed to clopidogrel bisulfate was valid and infringed. Claims covering the hydrochloride, hydrobromide and taurocholate salts also were found valid. However claim 1 of the patent directed to
clopidogrel and its pharmaceutical salts was found to be invalid. All parties appealed. In September 2009, the Full Federal Court of Australia held the Australian patent covering clopidogrel to be invalid. Sanofi-aventis filed an appeal with the
Supreme Court in November 2009. In March 2010, the Supreme Court refused special leave to appeal. Apotex is now seeking damages for having been subject to an injunction. The case is in the early stages.



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  Allegra® Patent Litigation



United States.Sanofi-aventis has been engaged in patent infringement actions concerning Allegra® since the first ANDA referring to this product was submitted to the FDA in 2001.



Patent infringement suits against Ranbaxy and Sandoz were
dismissed in February 2007 and January 2010 respectively when each independently withdrew their respective Paragraph IV certifications and converted their respective ANDA applications for fexofenadine products to Paragraph III certifications.



Sanofi-aventis U.S. continues
to be involved in ongoing U.S. patent litigation against other parties in relation to the Allegra® single
entity formulation (Mylan, Dr. Reddys, Sun, Wockhardt and Aurolife/Aurobindo), Allegra-D® 12
Hour (Impax, Mylan, Dr. Reddys, Sun, and Wockhardt), Allegra® oral suspension (Actavis), as well as
Allegra-D® 24 Hour (Dr. Reddys).



In June 2010, the United States District
Court for the District of New Jersey granted a motion for a preliminary injunction brought by sanofi-aventis US and its licensor, Albany Molecular Research, Inc. (Albany), against Dr. Reddys Laboratories to enjoin the marketing of
unlicensed generic versions of Allegra-D® 24 Hour tablets. On January 13, 2011, the District Court ruled
that the claims of Albanys U.S. Patent No. 7,390,906 are limited to the use of 98% pure para-cyclopropyl ketone compounds in the manufacture of fexofenadine. On January 28, 2011, sanofi-aventis and Albany filed a stipulation stating
their objection to the District Court ruling which limited the claims of Albanys patent as described above and stating that sanofi-aventis could not meet its burden of proving at trial infringement of the Albany patent by Dr. Reddys
generic version of Allegra-D® 24 Hour under the District Courts claim construction ruling. The filing of
the stipulation preserves all objections of sanofi-aventis and Albany to the District Court ruling and provides for an immediate appeal to the United States Court for the Federal Circuit. On January 28, 2011, the District Court lifted the
preliminary injunction prohibiting Dr. Reddys from commercializing its generic version of Allegra-D®
24 Hour. However, the Court also ordered that there shall be no application for a decision on the $40 million security, posted by sanofi-aventis in connection with the June 2010 preliminary injunction, without prior approval of the District
Court, until after resolution by the Federal Circuit of sanofi-aventis appeal of the District Courts claim construction ruling.



  Actonel® Patent Litigation



Actonel® was originally marketed by the Alliance for Better Bone Health, an alliance between Procter & Gamble Company and P&G Pharmaceuticals (together P&G)
and Aventis Pharmaceuticals Inc. (API). On October 30, 2009, P&G sold its pharmaceutical business to Warner Chilcott, succeeding to P&Gs rights and obligations in the alliance. P&G had filed a patent infringement suit in 2004
against Teva Pharmaceuticals USA in the U.S. District Court for the District of Delaware in response to Tevas application to market a generic version of Actonel® (risedronate sodium) tablets in the United States. Sanofi-aventis is not a party to this action. On February 28, 2008, the U.S. District Court for
the District of Delaware held P&Gs U.S. Patent No. 5,538,122 (the  122 Patent) claiming the active ingredient of Actonel® to be valid and enforceable.



P&G filed additional patent infringement actions against Teva in 2008 in response to Tevas applications to
market a generic version of Actonel® 75mg tablets and Actonel® plus Calcium. In May 2008, the District Court judge entered an order of final judgment in favor of P&G, in both cases, and Teva appealed all three final
judgments. The three appeals were consolidated by the Federal Circuit and a hearing was held December 2, 2008. In May 2009, the U.S. Court of Appeals ruled in favor of P&G and confirmed the validity of the 122 Patent.



In September
2008, January and March 2009, and April 2010, P&G (Warner Chilcott) and Roche brought suit in the U.S. District Court of Delaware in response to respectively Tevas, Sun Pharma Globals, Apotexs and Mylans
applications to market a generic version of the 150mg Actonel® tablets.



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  Ramipril Canada Patent Litigation



Sanofi-aventis is involved in a number
of legal proceedings involving companies which market generic Altace® (ramipril) in Canada. Notwithstanding
proceedings initiated by sanofi-aventis, the following eight manufacturers: Apotex (in 2006), Teva (formerly Novopharm), Sandoz and Cobalt (in 2007), and Riva, Genpharm, Ranbaxy and Pro Doc (in 2008), obtained marketing authorizations from the
Canadian Minister of Health for generic versions of ramipril in Canada. Following the marketing of these products, sanofi-aventis filed patent infringement actions against all eight companies. In the patent infringement actions against Apotex and
Teva, the Federal Court of Canada ruled on June 29, 2009 that the asserted patent was invalid. Each of Teva, Apotex and Riva have initiated Section 8 damages claims against sanofi-aventis, seeking compensation for their alleged inability
to market a generic ramipril during the time taken to resolve the proceedings against the Canadian Ministry of Health. The Apotex and Teva trials have been scheduled for the first quarter of 2012 while the Riva trial has not yet been scheduled.
Sanofi-aventis has filed appeals of the Federal Court of Canada decisions on the patent invalidity before the Federal Court of Appeal. Neither appeal suspends the advancement of the existing damages claims.



  Taxotere® Patent Litigation



United States.Sanofi-aventis received notifications from Hospira, Apotex and Sun in 2007 and 2008 who have
filed 505 (b) (2) applications, and from Sandoz in 2009 and Accord Pharmaceuticals in 2010 who each filed an ANDA with the U.S. Food and Drug Administration (FDA) seeking to market generic versions of Taxotere®. In response to these notifications, sanofi-aventis has filed patent infringement lawsuits against Hospira and
Apotex (2007), Sun (2008), Sandoz (2009), and Accord (January 2011). The lawsuits are pending in the U.S. District Court for the District of Delaware. None of the applications contested U.S. Patent No. 4,814,470 claiming the active ingredient,
which expired in May 2010. The cases against Hospira and Apotex were consolidated for trial held between October 26, 2009 and November 2, 2009. In September 2010, the U.S. District Court for the District of Delaware ruled against
sanofi-aventis in the consolidated Hospira/Apotex trial, finding the disputed patents both invalid and unenforceable. Subsequently, in October 2010, sanofi-aventis appealed to the United States Court of Appeals for the Federal Circuit. Based on the
District Courts judgment in the consolidated Hospira/Apotex action, judgments were entered against sanofi-aventis in the Sun and Sandoz actions. Sanofi-aventis has appealed the Sun and Sandoz judgments to the United States Court of Appeals for
the Federal Circuit. All three appeals are pending. The proceedings against Accord are in the early stages.



Canada. In October 2007, sanofi-aventis learned that Hospira Healthcare Corporation had filed an application
with Canadian authorities for a marketing authorization for a proposed docetaxel product which is the active ingredient of
Taxotere®, alleging that Aventis Pharma SAs Canadian Patent Nos. 2,102,777 and 2,102,778 (the 
778 Patent) for docetaxel were invalid and not infringed. On November 29, 2007, sanofi-aventis Canadian subsidiary and Aventis Pharma SA commenced an application for judicial review in the Federal Court of Canada. On
October 22, 2009, the Federal Court of Canada dismissed the lawsuit after finding the 778 Patent invalid. Sanofi-aventis decided not to appeal the decision. In Canada, the compound patent relating to this product has expired.



Europe. In several European
countries, in particular Germany and France, the generic manufacturers have requested the revocation of some formulation and combination patents regarding Taxotere® either before the patent office or courts. Certain proceedings are ongoing.



  Eloxatin® (oxaliplatin) Patent Litigation



United States. Starting in February 2007, over a dozen ANDA certifications relating to Eloxatin® (oxaliplatin) solution and/or lyophilized products were filed contesting part or all of the Orange Book patents
under Paragraph IV. Each of the generic manufacturers was sued for infringement of one or more of the Orange-Book listed patents before the U.S. District Court for the District of New Jersey. U.S. regulatory data exclusivity expired in February
2008.



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In June 2009, the U.S. District Court for the District of New Jersey granted a summary
judgment motion in favor of certain generic manufacturers. The District Court held that the generic oxaliplatin products that would be introduced by these generic challengers would not infringe the U.S. Patent No. 5,338,874 (the 
874 Patent). While sanofi-aventis obtained appellate reversal of the District Courts judgment, a number of generic oxaliplatin products were launched at risk in the United States over the second half of 2009.
Sanofi-aventis had been unsuccessful in obtaining injunctive relief. On December 2, 2009, the court asked all the parties to consider settlement.



In April 2010, sanofi-aventis and Debiopharm, licensor of the patents rights concerned, signed settlement agreements
with all but one of the generic manufacturers, Sun Pharmaceuticals, thus resolving the litigation over certain formulations of Eloxatin® (oxaliplatin) in the U.S. District Court for the District of New Jersey and the U.S. District Court for the District of Columbia.



Under the terms of the settlement agreements, the generic
manufacturers would cease selling their unauthorized generic oxaliplatin products in the U.S. starting from June 30, 2010, to August 9, 2012, at which time the generic manufacturers would be authorized to sell generic oxaliplatin products
under a license, before expiry of the patents at issue. The settlement provisions, including the market exit and re-entry dates noted above, are subject to contingencies. The settlement agreements are subject to review by the Federal Trade
Commission, the U.S. Department of Justice and the Attorney General for the State of Michigan.



In addition, the court decided that the above-described obligation to cease selling unauthorized generic oxaliplatin in the U.S. market also applied to Sun Pharmaceuticals and issued an injunction against
Sun Pharmaceuticals. Sun Pharmaceuticals appealed that decision. On December 22, 2010, the Court of Appeals for the Federal Circuit ruled in favor of Sun Pharmaceuticals, vacating the U.S. District Court of New Jersey decision and injunction
requiring Sun Pharmaceuticals to cease selling its at risk generic product on June 30, 2010. On January 21, 2011, sanofi-aventis filed a request for reconsideration of the Federal Circuit Courts December 2010 decision. On
February 7, 2011, the U.S. Court of Appeals for the Federal Circuit denied sanofi-aventis petition for an en banc hearing to reconsider the U.S. District Courts December 2010 decision. Sanofi-aventis is pursuing its legal options.



  Ambien® CR Patent Litigation



Starting in 2007, sanofi-aventis filed suits for infringement of U.S. Patent No. 6,514,531 (the
 531 Patent) in the U.S. District Court for the District of New Jersey based on ANDAs for a generic version of Ambien® CR filed by Watson, Barr, Mutual and Sandoz. Watson subsequently converted to a Paragraph III certification, and Barr and Mutual have withdrawn their ANDAs, leaving
suit in New Jersey ongoing only against Sandoz.



In 2007, sanofi-aventis also filed suit for infringement of the 531 Patent in the U.S. District Court for the Middle District of North Carolina based on an ANDA for a generic version of Ambien® CR filed by Synthon. That case was transferred to the Eastern District of North Carolina, and subsequently was
stayed pending a USPTO reexamination of the 531 Patent. On December 22, 2009, Synthon provided sanofi-aventis with 120 days notice of its intention to launch its generic version of Ambien® CR. In August 2010, the USPTO issued a final rejection of the 531 Patent, which sanofi-aventis appealed to the
Patent Office Board of Appeals in November 2010. The proceedings against Synthon remain stayed pending the decision of the Patent Office Board of Appeals.



Sanofi-aventis did not bring suit against Anchen, which was the first to notify sanofi-aventis of its Paragraph IV
ANDA on the 12.5mg strength, or against Abrika (now Actavis), which was the first to notify sanofi-aventis on its Paragraph IV ANDA on the 6.25mg strength. Sanofi-aventis also did not bring suit against four other subsequent Paragraph IV filers:
Lupin, Andrx, PTS Consulting and Apotex. Marketing exclusivities in the United States for Ambien® CR
expired in March 2009.



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  Xatral® Patent Litigation



Starting in August 2007, sanofi-aventis has received several ANDA certifications relating to Xatral® in the United States under Paragraph IV. Each of the generic manufacturers has been sued for infringement of one or
both of the Orange Book listed patents before the U.S. District Court for the District of Delaware. Trial against Mylan (who was the only remaining defendant) took place in May 2010. The U.S. District Court ruled in favour of sanofi-aventis, finding
infringement on the part of Mylan and later finding that the invention of U.S. Patent No. 4,661,491 (the  491 Patent) is not obvious. Mylans period to appeal has expired. Sanofi-aventis was granted pediatric
exclusivity on August 9, 2010 and the patent will now expire on July 18, 2011. Generic versions of
Xatral® cannot launch until the patent expires.



Glossary of Patent Terminology



A number of technical terms used above in Note D.22.b), are
defined below for the convenience of the reader.



ANDA or Abbreviated New Drug Application (United States): An application by a drug manufacturer to receive authority from the U.S.
FDA to market a generic version of another companys approved product, by demonstrating that the purportedly generic version has the same properties (bioequivalence) as the original approved product. As a result of data exclusivity, the ANDA
may be filed only several years after the initial market authorization of the original product.



Paragraph III and Paragraph IV Certifications: ANDAs relating to approved products for which a patent has been listed in the FDAs list of Approved Drug Products with Therapeutic Equivalence
Evaluations, also known as the Orange Book, must specify whether final FDA approval of the ANDA is sought only after expiration of the listed patent(s) (this is known as a Paragraph III certification under the Hatch-Waxman Act) or
whether final FDA approval is sought prior to expiration of one or more listed patents (a Paragraph IV certification). ANDAs including a Paragraph IV certification may be subject to the 30-Month Stay defined below.



Section 505(b)(2) application: A section
505(b)(2) application may be used to seek FDA approval for, among other things, combination products, different salts of listed drugs, products that do not demonstrate bioequivalence to a listed drug and over-the-counter versions of prescription
drugs.



Summary judgment: A judgment
granted on a claim or defense about which there is no genuine issue of material fact and upon which the movant is entitled to prevail as a matter of law. This procedural device allows the speedy disposition of a controversy without the need for
trial.



30-Month Stay (United States): If
patent claims cover a product listed in the FDAs list of Approved Drug Products with Therapeutic Equivalence Evaluations, also known as the Orange Book, and are owned by or licensed to the manufacturer of the original version, the
FDA is barred from granting a final approval to an ANDA during the 30 months following the patent challenge, unless, before the end of the 30 months, a court decision or settlement has determined either that the ANDA does not infringe the listed
patent or that the listed patent is invalid and/or unenforceable. FDA approval of an ANDA after this 30-month period does not resolve outstanding patent disputes, which may continue to be litigated in the courts.



c) Government Investigations, Competition Law and Regulatory Claims



  Government Investigations 
Pricing and Marketing Practices



Lovenox® Marketing. The U.S. Attorneys Office in
Chicago, Illinois conducted a civil and criminal investigation with regard to Lovenox® sales and marketing
practices for a period starting January 1, 1999. Without prejudice to its right to pursue any further investigation in the future, the U.S. government has declined to intervene in a Federal False Claims Act case related to the facts
under investigation brought by two



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former employees, and the matter proceeded against sanofi-aventis as civil litigation in Illinois Federal Court. In June 2010, the parties in the civil action reached a settlement, and
the case was subsequently dismissed.



Ambien® and Ambien® CR Marketing.On August 11, 2008, sanofi-aventis U.S. received a subpoena issued by the U.S.
Department of Health & Human Services Office of Inspector General and the U.S. Attorneys Office in San Francisco, California. The subpoena requested information regarding Ambien® and Ambien® CR sales and
marketing practices in connection with an investigation of possible false or otherwise improper claims for payment under Medicare and Medicaid. Sanofi-aventis U.S. provided documents in response to this subpoena. In November 2010, the US District
Court for the Northern District of California entered an order dismissing without prejudice a Federal False Claims Act case related to the facts under investigation.



  Civil Suits  Pricing and Marketing Practices



Average Wholesale Prices (AWP) Class
Actions. Aventis Pharmaceuticals Inc. (API) is a defendant in several U.S. lawsuits seeking damages on behalf of multiple putative classes of individuals and entities that allegedly overpaid for certain pharmaceuticals as a result of the AWP
pricing which were used to set Medicare and Medicaid reimbursement levels. Aventis Behring and Sanofi-Synthelabo Inc. were also defendants in some of these cases. These suits allege violations of various statutes, including state unfair trade,
unfair competition, consumer protection and false claim statutes.



A group of eleven defendants, including sanofi-aventis defendants, reached a tentative global settlement of the claims of the insurers and consumers, for a total of $125 million. This settlement was
granted preliminary approval by the U.S. District Court in Boston in early July 2008. Subject to the final approval hearing which is expected in 2011, all the class action suits against API before the U.S District Court in Boston will be resolved
consistent with the settlement. Sanofi-aventis share of the global settlement is fully covered by existing reserves. One additional purported class action remains in New Jersey and is in the discovery phase.



AWP Public Entity Suits.U.S. subsidiaries of the
Group, together with several dozen other pharmaceutical companies, are defendants in lawsuits brought starting in 2002 by certain states for AWP pricing issues described above. Sanofi-aventis U.S. has resolved many such suits, but continues to
defend claims brought by the states of Alaska, Florida, Idaho, Illinois, Kentucky, Louisiana, Oklahoma and Wisconsin.



§ 340B Suit. On August 18, 2005, the County of Santa Clara, California filed a suit against Aventis Pharmaceuticals Inc.
and fourteen other pharmaceutical companies originally in the Superior Court of the State of California, County of Alameda, alleging that the defendants had overcharged Public Health Service entities for their pharmaceutical products in breach of
pharmaceutical pricing agreements between the defendants and the Secretary of Health and Human Services. Subsequently, the case was removed to the United States District for the Northern District of California. In May 2009, the Court denied the
plaintiffs motion for class certification without prejudice. All proceedings in the District Court are stayed pending a decision of the Supreme Court concerning whether plaintiffs have a private right of action. A hearing before the Supreme
Court on this issue is scheduled in the first quarter of 2011.



  Pharmaceutical Industry Antitrust Litigation



Approximately 135 cases remain pending of the numerous
complaints that were filed in the mid-1990s by retail pharmacies in both federal and state court. These complaints shared the same basic allegations: that the defendant pharmaceutical manufacturers and wholesalers, including sanofi-aventis
predecessor companies, violated the Sherman Act, the Robinson Patman Act, and various state antitrust and unfair competition laws by conspiring to deny all pharmacies, including chains and buying groups, discounts off the list prices of brand-name
drugs. Shortly before a November 2004 trial in the U.S. District Court for the Eastern District of New York, sanofi-aventis and the remaining manufacturer defendants settled the Sherman Act claims of the majority of the remaining plaintiffs.
These settlements did not dispose of the remaining plaintiffs Robinson Patman Act claims.



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  European Commission Sector Inquiry



In January 2008, the European Commissions Directorate
General for Competition opened a sector inquiry into the functioning of the market to investigate what it considered to be a low level of competition in the pharmaceuticals industry in the European Union. The inquiry commenced with unannounced
information-gathering inspections at a number of companies including sanofi-aventis. According to the Commission, the sector inquiry ultimately involved information gathering from 43 originator companies and 27 generic companies. The final report
was released on July 8, 2009. The Commission announced that the pharmaceutical industry remains under scrutiny. In January 2010, the European Commission initiated a monitoring exercise on patent settlements between originator companies and
generic companies for the periods 2008 and 2009. The European Commission announced that it will repeat the monitoring exercise in 2011.



  European Commission generics investigation



On October 6, 2009, the European Commission conducted
surprise inspections in the offices of several pharmaceutical companies, including sanofi-aventis, under suspicion of infringing antitrust rules of the European Union with respect to their activities concerning so-called generic
products. Sanofi-aventis continues to cooperate with the European Commission in this matter.



  Cipro® Antitrust Litigation



Since August 2000, Aventis Pharmaceuticals Inc. (API) has been a defendant in several related cases in U.S. state and
federal courts alleging that API and certain other pharmaceutical manufacturers violated U.S. antitrust laws and various state laws by settling a patent dispute regarding the brand-name prescription drug Cipro® in a manner which allegedly delayed the arrival of generic competition. In March 2005, the U.S. District Court for
the Eastern District of New York granted sanofi-aventis summary judgment motions, and issued a judgment in favor of API and the other defendants in this litigation. By order entered October 15, 2008, the U.S. Court of Appeals for the
Federal Circuit affirmed the District Courts ruling in the appeal by indirect purchaser plaintiffs; the direct purchaser plaintiffs appeal was heard by the U.S. Court of Appeals for the Second Circuit in April 2009. In April 29,
2010, the Federal Circuit affirmed the District Courts ruling dismissing the direct purchasers case on summary judgment. The direct purchaser plaintiffs requested a rehearing en banc, which was denied by the Federal Circuit in September
2010. The direct purchaser plaintiffs have appealed to the U.S. Supreme Court.



  DDAVP® Antitrust Litigation



Subsequent to the decision of the U.S.
District Court for the Southern District of New York in February 2005 holding the patent rights at issue in the
DDAVP® tablet litigation to be unenforceable as a result of inequitable conduct, eight putative class actions
have been filed claiming injury as a result of Ferring B.V. and Aventis Pharmaceuticals Inc.s alleged scheme to monopolize the market for DDAVP® tablets in violation of the Sherman Act and the antitrust and deceptive trade practices statutes of several states. On November 6, 2006, the District Court
dismissed these claims. Oral argument on plaintiffs appeal of the decision to dismiss was heard by the U.S. Court of Appeals for the Second Circuit in 2008. By order dated October 16, 2009, the appellate court reversed and remanded the
case back to the District Court. Petitions for rehearing and rehearing en banc were denied.



  Plavix® Antitrust Claim



On March 23, 2006, the U.S.
retailer The Kroger Co. filed an antitrust complaint in the District Court for the Southern District of Ohio against sanofi-aventis, Bristol-Myers Squibb Co. and Apotex Corp. alleging antitrust violations by the defendants in relation to their
tentative agreement to settle the U.S. Plavix® patent litigation (see Plavix® Patent Litigation  United States, above, for a description of the transaction). Seventeen other
complaints have since been filed by direct and indirect purchasers of Plavix® on the same or similar grounds.
Plaintiffs seek relief including injunctive relief and monetary damages. Defendants have moved to dismiss the



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consolidated direct and indirect purchasers complaints. By orders entered in October 2009, and in January 2011, the Court dismissed the claims of the direct purchasers and indirect
purchasers respectively. Appeals are expected.



  Lovenox® Antitrust Litigation



In August 2008, Eisai Inc. (Eisai) brought suit against sanofi-aventis U.S. LLC and sanofi-aventis U.S.
Inc. in the U.S. District Court for the District of New Jersey alleging that certain contracting practices for
Lovenox® violate federal and state antitrust laws. The proceedings are ongoing.



  Lovenox® Regulatory Litigation



In July 2010, sanofi-aventis learned that the Food and Drug Administration (FDA) had approved a generic enoxaparin ANDA filed by Sandoz.
Sanofi-aventis subsequently filed suit against the FDA in the U.S. District Court for the District of Columbia and requested preliminary injunctive relief against the FDA. In August 2010, the U.S. District Court denied this request. As a result of
this ruling, the generic version of enoxaparin can continue to be marketed in the United States. The Court has not yet ruled on the merits of sanofi-aventis suit against the FDA regarding the approval of the Sandoz enoxaparin ANDA.



d) Other litigation and arbitration



  Hoechst Shareholder Litigation



On December 21, 2004, the extraordinary general meeting
of sanofi-aventis German subsidiary Hoechst AG (now Hoechst GmbH) approved a resolution transferring the shares held by minority shareholders to sanofi-aventis for compensation of 56.50 per share. Certain minority shareholders filed
claims contesting the validity of the resolution, preventing its registration with the commercial register of Frankfurt and its entry into effect.



On July 12, 2005, this litigation was settled. As a consequence, the squeeze out has been registered in the commercial register
making sanofi-aventis the sole shareholder of Hoechst AG.



According to the settlement agreement, the cash compensation has been increased to 63.80 per share. The cash compensation was further increased by another 1.20 per share for those
outstanding shareholders who inter alia waived in advance any increase of the cash compensation obtained through a judicial appraisal proceeding (Spruchverfahren) brought by former minority shareholders. Subsequently, a number of
former minority shareholders of Hoechst initiated a judicial appraisal proceeding with the local Frankfurt court, Landgericht Frankfurt am Main, contesting the amount of the cash compensation paid in the squeeze out. The amount sought has not
been specified. The proceedings are ongoing.



  Apotex Settlement Claim



On November 13, 2008, Apotex filed a complaint before a state court in New Jersey against sanofi-aventis and
Bristol-Myers Squibb claiming the payment of a $60 million break-up fee, pursuant to the terms of the initial settlement agreement of March 2006 relating to the U.S. Plavix® patent litigation (see Patents  Plavix® Patent Litigation  United States). The proceedings are ongoing.



  Zimulti® /Acomplia® (rimonabant) Class
Action



In November 2007, a purported class
action was filed in the U.S. District Court for the Southern District of New York on behalf of purchasers of sanofi-aventis shares. The complaint charged sanofi-aventis and certain of its current and former officers and directors with violations of
the Securities Exchange Act of 1934. The complaint alleged that defendants statements regarding rimonabant were materially false and misleading when made because defendants allegedly concealed data concerning rimonabants propensity to
cause depression. In September 2009, the motion was dismissed with prejudice. The plaintiffs filed a motion for reconsideration. On



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Year ended December 31, 2010



July 27, 2010, the U.S. District Court for the Southern District of New York granted plaintiffs motion to reconsider and authorized plaintiffs to submit an amended complaint. In
November 2010, the District Court heard arguments on sanofi-aventis motion to dismiss plaintiffs amended complaint. The District Courts decision on the motion to dismiss is pending.



  Merial Heartgard Advertisement Claim



On August 31, 2009, a purported
class action lawsuit was filed against Merial, alleging that Merial engaged in false and misleading advertising of
Heartgard® and Heartgard® Plus by claiming 100% efficacy in the prevention of heartworm disease, as well as the prevention of zoonotic diseases. Plaintiffs also request punitive damages and a
permanent injunction with respect to the alleged advertising. The proceedings are ongoing and the class has not been certified yet.



e) Contingencies arising from certain Business Divestitures



Sanofi-aventis and its subsidiaries, Hoechst and Aventis
Agriculture, divested a variety of mostly chemical, including agro-chemical, businesses as well as certain health product businesses in previous years. As a result of these divestitures, the Group is subject to a number of ongoing contractual and
legal obligations regarding the state of the sold businesses, their assets, and their liabilities.



  Aventis Behring



The divestment of Aventis Behring and related protein therapies assets became effective on March 31, 2004. The purchase agreement contained customary representations and warranties running from
sanofi-aventis as seller to CSL Limited as purchaser. Sanofi-aventis has indemnification obligations that generally expired on March 31, 2006 (the second anniversary of the closing date). However, some indemnification obligations, having a
longer duration, remain in effect, for example, indemnification obligations relating to the due organization, capital stock and ownership of Aventis Behring Companies runs through March 31, 2014, and product liability indemnification through
March 31, 2019, subject to an extension for claims related to types of product liability notified before such date. Furthermore, for tax-related issues, the indemnification obligation of sanofi-aventis covers all taxable periods that end on or
before the closing date and expires thirty days after the expiration of the applicable statute of limitations. In addition, the indemnification obligations relating to certain specified liabilities, including HIV liability, survive indefinitely.



Under the indemnification agreement,
sanofi-aventis is generally obligated to indemnify, only to the extent indemnifiable, losses exceeding $10 million and up to a maximum aggregate amount of $300 million. For environmental claims, the indemnification due by sanofi-aventis equals
90% of the indemnifiable losses. Product liability claims are generally treated separately, and the aggregate indemnification is capped at $500 million. Certain indemnification obligations, including those related to HIV liability, as well as tax
claims, are not capped in amount.



  Aventis
CropScience



The sale by
Aventis Agriculture S.A. and Hoechst GmbH (both predecessor companies of sanofi-aventis) of their aggregate 76% participation in Aventis CropScience Holding (ACS) to Bayer and Bayer CropScience AG (BCS), the wholly owned subsidiary of Bayer which
holds the ACS shares, was effective on June 3, 2002. The stock purchase agreement dated October 2, 2001, contained customary representations and warranties with respect to the sold business, as well as a number of indemnifications, in
particular with respect to: environmental liabilities (the representations and warranties and the environmental indemnification are subject to a cap of 836 million, except for certain legal representations and warranties and specific
environmental liabilities, notably third-party site claims such as (i) the natural resources damages (NRD) claim filed by the state of New Jersey against BCS in 2007 in relation to the Factory Lane site, and (ii) a remediation and NRD
project underway in Portland, Oregon); taxes; certain legal proceedings; claims related to StarLink®corn; and
certain pre-closing



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Year ended December 31, 2010



liabilities, in particular, product liability cases (which are subject to a cap of 418 million). There are various periods of limitation depending upon the nature or subject of the
indemnification claim. Further, Bayer and BCS are subject to a number of obligations regarding mitigation and cooperation.



Starting with a first settlement agreement signed in December 2005, Aventis Agriculture and Hoechst have resolved a substantial number of
disputes with Bayer and BCS AG, including the termination of arbitration proceedings initiated in August 2003 for an alleged breach of a financial statement-related representation contained in the stock purchase agreement, and numerous other
warranty and indemnification claims asserted under the stock purchase agreement, including claims relating to certain environmental and product liabilities. A number of other outstanding claims remain unresolved.



LLRICE601 and LLRICE604  U.S.
Litigation: BCS has sent sanofi-aventis notice of potential claims for indemnification under various provisions of the stock purchase agreement. These potential claims relate to several hundred individual complaints that have been filed
since August 2006 by rice growers, millers, and distributors in U.S. state and federal courts against a number of current and former subsidiaries (collectively the CropScience Companies) which were part of the ACS group prior to
Bayers acquisition of the ACS shares. Plaintiffs in these cases seek to recover damages in connection with the detection of trace amounts of the genetically modified rice called Liberty Link® Rice 601 (also known as LLRICE601) or Liberty Link® Rice 604 (also known as LLRICE604) in samples of commercial long-grain rice. LLRICE601 and
LLRICE604, each a variety of long grain rice genetically altered to resist Liberty® Herbicide, were grown in
field tests in the United States from the years 1998 to 2001. Plaintiffs assert a number of causes of action, alleging that the CropScience Companies failed to take adequate measures to prevent cross-pollination or commingling of LLRICE601
and/or LLRICE604 with conventional rice. In six cases that have been tried to verdict in federal or state court, compensatory damages of approximately $11.5 million, in the aggregate, have been awarded. Two state court juries have also awarded
punitive damages in the amount of $500,000 in one case and $42 million in another. The CropScience Companies have appealed or intend to appeal the judgments in these cases. Other cases have been settled by Bayer, including three cases that were
settled shortly before or after trial began. Federal and state court proceedings are scheduled through 2011.



Sanofi-aventis denies direct or indirect liability for these cases, and has so notified BCS.



In a related development, the FDA has concluded that the
presence of LLRICE601 in the food and feed supply poses no safety concerns and, on November 24, 2006, the United States Department of Agriculture (USDA) announced it would deregulate LLRICE601. With respect to LLRICE 604, the USDA announced, in
March 2007, that the PAT protein contained in LLRICE604 has a long history of safe use and is present in many deregulated products. Further to an investigation regarding the causation chain that led to contamination, in October 2007, the USDA
declined to pursue enforcement against BCS.



  Aventis Animal Nutrition



Aventis Animal Nutrition S.A. and Aventis (both predecessor companies of sanofi-aventis) signed an agreement for the sale to Drakkar
Holdings S.A. of the Aventis Animal Nutrition business effective in April 2002. The sale agreement contained customary representations and warranties. Sanofi-aventis indemnification obligations ran through April 2004, except for
environmental indemnification obligations (which run through April 2012), tax indemnification obligations (which run through the expiration of the applicable statutory limitation period), and antitrust indemnification obligations (which extend
indefinitely). The indemnification undertakings are subject to an overall cap of 223 million, with a lower cap for certain environmental claims. Indemnification obligations for antitrust and tax claims are not capped.



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Year ended December 31, 2010



  Celanese AG



The demerger of the specialty chemicals business to Celanese AG became effective on October 22, 1999.
Under the demerger agreement between Hoechst and Celanese, Hoechst expressly excluded any representations and warranties regarding the shares and assets demerged to Celanese. However, the following obligations of Hoechst are ongoing:



While all obligations of Hoechst (i) resulting from
public law or (ii) pursuant to current or future environmental laws or (iii) vis-à-vis third parties pursuant to private or public law related to contamination (as defined) have been transferred to Celanese in full, Hoechst splits
with Celanese any such cost incurred under these obligations applying a 2:1 ratio.



To the extent Hoechst is liable to purchasers of certain of its divested businesses (as listed in the demerger agreement), Celanese must indemnify Hoechst, as far as environmental damages are concerned,
for aggregate liabilities up to 250 million, liabilities exceeding such amount will be borne by Hoechst alone up to 750 million, and amounts exceeding 750 million will be borne 2/3 by Hoechst and 1/3 by Celanese
without any further caps.



Compensation paid to
third parties by Celanese under the aforementioned clause, through December 31, 2010, was significantly below the first threshold of 250 million.



  Rhodia



In connection with the initial public offering of Rhodia in 1998, Rhône-Poulenc (later named Aventis, to which sanofi-aventis is the
legal successor in interest) entered into an environmental indemnification agreement with Rhodia on May 26, 1998 under which, subject to certain conditions, Rhodia was entitled to claim indemnification from Aventis with respect to direct losses
resulting from third-party claims or public authority injunctions for environmental damages. Aventis and Rhodia entered into a settlement agreement on March 27, 2003 under the terms of which the parties settled all environmental claims in
connection with the environmental indemnification agreement. Notwithstanding this settlement agreement, Rhodia and certain of its subsidiaries have unsuccessfully sought indemnification for environmental costs in the United States and Brazil. In
both instances, the suits were decided in favor of sanofi-aventis, with the court holding that the settlement precluded the indemnification claims. The decision in Brazil is currently under appeal by Rhodia.



On April 13, 2005, Rhodia initiated an ad hoc
arbitration procedure seeking indemnification from sanofi-aventis for the financial consequences of the environmental liabilities and pension obligations that were allocated to Rhodia through the various operations leading to the formation of Rhodia
in 1997, amounting respectively to 125 million and 531 million. Rhodia additionally sought indemnification for future costs related to transferred environmental liabilities and coverage of all costs necessary to fully fund the
transfer of pension liabilities out of Rhodias accounts. The arbitral tribunal determined that it has no jurisdiction to rule on pension claims and that Rhodias environmental claims are without merit. In May 2008, the Paris Court of
Appeals rejected the action initiated by Rhodia to nullify the 2006 arbitral award in favor of sanofi-aventis.



On July 10, 2007, sanofi-aventis was served with a civil suit brought by Rhodia before the Commercial Court of Paris (Tribunal de
Commerce de Paris) seeking indemnification on the same grounds as described above. The allegations before the Commercial Court of Paris are comparable to those asserted in Rhodias arbitration demand. On February 10, 2010, Rhodia
submitted its pleadings brief (conclusions récapitulatives) in which it has asked the Court to hold that sanofi-aventis was at fault in failing to provide Rhodia with sufficient capital to meet its pension obligations and environmental
liabilities, and has claimed indemnification in the amount of 1.3 billion for retirement commitments and approximately 311 million for environmental liabilities. The procedure is still pending.



  Rhodia Shareholder Litigation



In January 2004, two minority shareholders of Rhodia and
their respective investment vehicles filed two claims before the Commercial Court of Paris (Tribunal de Commerce de Paris) against Aventis, to which sanofi-



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Year ended December 31, 2010



aventis is successor in interest, together with other defendants including former directors and statutory auditors of Rhodia from the time of the alleged events. The claimants seek a judgment
holding the defendants collectively liable for alleged management errors and for alleged publication of misstatements between 1999 and 2002, and inter alia regarding Rhodias acquisition of the companies Albright & Wilson and
ChiRex. These shareholders seek a finding of joint and several liability for damages to be awarded to Rhodia in an amount of 925 million for alleged harm to the Company (a derivative action), as well as personal claims of
4.3 million and 125.4 million for their own alleged individual losses. Sanofi-aventis contests both the substance and the admissibility of these claims.



Sanofi-aventis is also aware of three criminal complaints
filed in France by the same plaintiffs and of a criminal investigation order issued by the Paris public prosecutor following the submission of the report issued by the Autorité des Marchés Financiers regarding Rhodias
financial communications. In 2006, the Commercial Court of Paris accepted sanofi-aventis and the other defendants motion to stay the civil litigation pending the conclusion of the criminal proceedings. The plaintiffs appeals against this
decision, first before the Court of Appeals, and then before the French Supreme Court (Cour de Cassation), were both rejected.



  Clariant  Specialty Chemicals Business



Hoechst conveyed its specialty chemicals business to
Clariant AG (Clariant) pursuant to a 1997 agreement. While Clariant has undertaken to indemnify Hoechst for all costs incurred for environmental matters relating to purchased sites, certain ongoing indemnification obligations of Hoechst for
environmental matters in favor of Clariant can be summarized as follows:



| |  |  | Costs for environmental matters at the sites taken over, directly or indirectly, by Clariant and not attributable to a specific activity of Hoechst or
of a third party not related to the business transferred to Clariant are to be borne by Clariant to the extent the accumulated costs since the closing in any year do not exceed a threshold amount for the then-current year. The threshold increases
annually from approximately 102 million in 1997/98 to approximately 816 million in the fifteenth year after the closing. Only the amount by which Clariants accumulated costs exceed the then-current years threshold
must be compensated by Hoechst. No payments have yet become due under this rule.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Hoechst must indemnify Clariant indefinitely (i) with respect to sites taken over by Clariant, for costs which relate to environmental pollutions
attributable to certain activities of Hoechst or of third parties, (ii) for costs attributable to four defined waste deposit sites in Germany which are located outside the sites taken over by Clariant (to the extent exceeding an indexed amount
of approximately 20.5 million), (iii) for costs from certain locally concentrated pollutions in the sites taken over by Clariant but not caused by specialty chemicals activities in the past, and (iv) for 75% of the costs relating to
a specific waste deposit site in Frankfurt, Germany.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



  InfraServ Höchst



By the Asset Contribution Agreement dated December 19/20, 1996, as amended in 1997, Hoechst contributed all lands, buildings, and related assets of the Hoechst site at Frankfurt-Höchst to
InfraServ Höchst GmbH & Co. KG. InfraServ Höchst undertook to indemnify Hoechst against environmental liabilities at the Höchst site and with respect to certain landfills. As consideration for the indemnification undertaking,
Hoechst transferred to InfraServ approximately 57 million to fund reserves. In 1997, Hoechst also agreed it would reimburse current and future InfraServ Höchst environmental expenses up to 143 million. As a former owner of the
land and as a former user of the landfills, Hoechst may ultimately be liable for costs of remedial action in excess of this amount.



D.23. Provisions for discounts, rebates and sales returns



Adjustments between gross sales and net sales, as described in Note B.14., are recognized either as provisions or as reductions in
accounts receivable, depending on their nature.



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Year ended December 31, 2010



The table below shows movements in these items:



|                                                      |  |                                 |      |     |                                 |  |      |                       |  |  |                      |   |  |              |        |   |                 |  |      |       |  |  |      |   |  |  |        |  
|----------------------------------------------------- |  | ------------------------------- | ---- | --- | ------------------------------- |  | ---- | --------------------- |  |  | -------------------- | - |  | ------------ | ------ | - | --------------- |  | ---- | ----- |  |  | ---- | - |  |  | ------ | -
|( million)                                           |  | Governmentand Stateprograms
(1) |      |     | Managed Careand GPOprograms
(2) |  |      | Charge-backincentives |  |  | Rebates anddiscounts |   |  | Salesreturns |        |   | Otherdeductions |  |      | Total | 
|January 1, 2008                                       |  |                                 | 242  |     |                                 |  | 136  |                       |  |  | 60                   |   |  |              | 437    |   |                 |  | 196  |       |  |  | 69   |   |  |  | 1,140  |  
|Current provision related to current period sales     |  |                                 | 466  |     |                                 |  | 366  |                       |  |  | 751                  |   |  |              | 1,516  |   |                 |  | 173  |       |  |  | 135  |   |  |  | 3,407  |  
|Net change in provision related to prior period sales |  |                                 | 10   |     |                                 |  | (3   | )                     |  |  | (8                   | ) |  |              | 5      |   |                 |  | 4    |       |  |  | (3   | ) |  |  | 5      |  
|Payments made                                         |  |                                 | (442 | )   |                                 |  | (324 | )                     |  |  | (725                 | ) |  |              | (1,678 | ) |                 |  | (193 | )     |  |  | (146 | ) |  |  | (3,508 | )
|Translation differences                               |  |                                 | 10   |     |                                 |  | 10   |                       |  |  | 4                    |   |  |              | (19    | ) |                 |  | 3    |       |  |  | (3   | ) |  |  | 5      |  
|December 31, 2008                                     |  |                                 | 286  |     |                                 |  | 185  |                       |  |  | 82                   |   |  |              | 261    |   |                 |  | 183  |       |  |  | 52   |   |  |  | 1,049  |  
|Current provision related to current period sales     |  |                                 | 566  |     |                                 |  | 433  |                       |  |  | 904                  |   |  |              | 2,036  |   |                 |  | 204  |       |  |  | 128  |   |  |  | 4,271  |  
|Net change in provision related to prior period sales |  |                                 | 19   |     |                                 |  | 7    |                       |  |  |                     |   |  |              | 12     |   |                 |  | (7   | )     |  |  |     |   |  |  | 31     |  
|Payments made                                         |  |                                 | (477 | )   |                                 |  | (431 | )                     |  |  | (903                 | ) |  |              | (1,893 | ) |                 |  | (175 | )     |  |  | (136 | ) |  |  | (4,015 | )
|Translation differences                               |  |                                 | (8   | )   |                                 |  | (7   | )                     |  |  | (3                   | ) |  |              | 9      |   |                 |  | (3   | )     |  |  | 2    |   |  |  | (10    | )
|December 31, 2009                                     |  |                                 | 386  |     |                                 |  | 187  |                       |  |  | 80                   |   |  |              | 425    |   |                 |  | 202  |       |  |  | 46   |   |  |  | 1,326  |  
|Current provision related to current period sales     |  |                                 | 937  | (3) |                                 |  | 410  |                       |  |  | 1,246                |   |  |              | 3,058  |   |                 |  | 357  |       |  |  | 127  |   |  |  | 6,135  |  
|Net change in provision related to prior period sales |  |                                 | (4   | )   |                                 |  | (11  | )                     |  |  | 8                    |   |  |              | 14     |   |                 |  | 12   |       |  |  | (4   | ) |  |  | 15     |  
|Payments made                                         |  |                                 | (663 | )   |                                 |  | (400 | )                     |  |  | (1,225               | ) |  |              | (2,719 | ) |                 |  | (255 | )     |  |  | (126 | ) |  |  | (5,388 | )
|Translation differences                               |  |                                 | 16   |     |                                 |  | 15   |                       |  |  | 6                    |   |  |              | 35     |   |                 |  | 17   |       |  |  | 5    |   |  |  | 94     |  
|December 31, 2010                                     |  |                                 | 672  |     |                                 |  | 201  |                       |  |  | 115                  |   |  |              | 813    |   |                 |  | 333  |       |  |  | 48   |   |  |  | 2,182  |  



|(1) | Primarily the U.S. governments Medicare and Medicaid programs.
|--- | ---------------------------------------------------------------

|(2) | Rebates and other price reductions, primarily granted to healthcare authorities
in the United States.
|--- | -----------------------------------------------------------------------------------------------------

|(3) | The movement during 2010 is mainly due to the impact of U.S. healthcare reforms.
|--- | --------------------------------------------------------------------------------



D.24. Personnel costs



Total personnel costs break down as follows:



|                                                                       |  |                            |       |  |                            |  |       |                            |  |  |       | 
|---------------------------------------------------------------------- |  | -------------------------- | ----- |  | -------------------------- |  | ----- | -------------------------- |  |  | ----- | 
|( million)                                                            |  | Year endedDecember 31,2010 |       |  | Year endedDecember 31,2009 |  |       | Year endedDecember 31,2008 | 
|Salaries                                                               |  |                            | 5,121 |  |                            |  | 5,019 |                            |  |  | 4,774 | 
|Social security charges (including defined-contribution pension plans) |  |                            | 1,555 |  |                            |  | 1,510 |                            |  |  | 1,451 | 
|Stock options and other share-based payment expense                    |  |                            | 133   |  |                            |  | 114   |                            |  |  | 125   | 
|Defined-benefit pension plans                                          |  |                            | 340   |  |                            |  | 404   |                            |  |  | 305   | 
|Other employee benefits                                                |  |                            | 238   |  |                            |  | 233   |                            |  |  | 259   | 
|Total                                                                  |  |                            | 7,387 |  |                            |  | 7,280 |                            |  |  | 6,914 | 



The total number of employees at December 31, 2010 was 101,575, compared with 104,867 at December 31, 2009 and 98,213 at
December 31, 2008 (these employee numbers are unaudited).



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Year ended December 31, 2010



Employee numbers by function (excluding Merial) as of December 31 are shown below
(unaudited):



|                                |  |                  |         |  |                  |  |         |                  |  |  |        | 
|------------------------------- |  | ---------------- | ------- |  | ---------------- |  | ------- | ---------------- |  |  | ------ | 
|                                |  | December 31,2010 |         |  | December 31,2009 |  |         | December 31,2008 | 
|Production                      |  |                  | 37,504  |  |                  |  | 36,849  |                  |  |  | 31,903 | 
|Research and development        |  |                  | 16,983  |  |                  |  | 19,132  |                  |  |  | 18,976 | 
|Sales force                     |  |                  | 32,686  |  |                  |  | 34,292  |                  |  |  | 33,507 | 
|Marketing and support functions |  |                  | 14,402  |  |                  |  | 14,594  |                  |  |  | 13,827 | 
|Total                           |  |                  | 101,575 |  |                  |  | 104,867 |                  |  |  | 98,213 | 



Merial had a total of 5,581 employees as of December 31, 2010 (unaudited).



D.25. Other operating income



Other operating income amounted to 359 million in 2010, compared with 866 million in 2009 and 556 million
in 2008.



This line includes
income arising under alliance agreements in the Pharmaceuticals segment (315 million in 2010, versus 646 million in 2009 and 472 million in 2008), in particular the agreement on the worldwide development and marketing of
Actonel® (see Note C.2.) and the Groups share of profits on Copaxone®. The 331 million fall in 2010 relative to 2009 was mainly due to the discontinuation in the second
quarter of royalty payments from Teva on North American sales of Copaxone®.



It also includes operating foreign exchange gains and losses,
representing a net loss of 141 million in 2010, compared with a net gain of 40 million in 2009 and a net loss of 94 million in 2008; and proceeds from disposals related to ongoing operations, which amounted to
54 million in 2010, 56 million in 2009, and 24 million in 2008.



D.26. Other operating expenses



Other operating expenses amounted to 276 million in 2010, versus 481 million in 2009 and
353 million in 2008. This item includes shares of profits due to alliance partners (other than BMS and the Alliance Partner under the Actonel® agreement) under product marketing agreements, primarily in Europe, Japan, the United States and Canada (169 million in 2010, versus 186 million in
2009 and 178 million in 2008).



In
2009, this item included an expense of 69 million arising from changes to estimates of future expenditure on environmental risks at sites formerly operated by sanofi-aventis or sold to third parties (see note D.22.
(e) Contingencies arising from certain Business Divestitures). Reversals of these provisions are classified in Other operating income(see Note D.25.).



This item also includes, for 2010, an expense of 51 million (2009: 59 million) relating to
pensions and other benefits for retirees.



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Year ended December 31, 2010



D.27. Restructuring costs



Restructuring costs recognized in 2010 amounted to
1,372 million (1,080 million in 2009; 585 million in 2008), and break down as follows:



|                                                                                     |  |                            |       |  |                            |  |       |                            |  |  |     | 
|------------------------------------------------------------------------------------ |  | -------------------------- | ----- |  | -------------------------- |  | ----- | -------------------------- |  |  | --- | 
|( million)                                                                          |  | Year endedDecember 31,2010 |       |  | Year endedDecember 31,2009 |  |       | Year endedDecember 31,2008 | 
|Employee-related expenses                                                            |  |                            | 817   |  |                            |  | 869   |                            |  |  | 498 | 
|Expenses related to property, plant and equipment                                    |  |                            | 184   |  |                            |  | 146   |                            |  |  |    | 
|Compensation for early termination of contracts (other than contracts of employment) |  |                            | 35    |  |                            |  | 19    |                            |  |  |    | 
|Decontamination costs                                                                |  |                            | 105   |  |                            |  | 30    |                            |  |  | 50  | 
|Other restructuring costs                                                            |  |                            | 231   |  |                            |  | 16    |                            |  |  | 37  | 
|Total                                                                                |  |                            | 1,372 |  |                            |  | 1,080 |                            |  |  | 585 | 



The restructuring costs recognized in 2010 mainly related to:



| |  |  | the transformation of Research & Development operations, in particular the financial impact of the agreement with Covance which, in addition
to the divestment of the Alnwick and Porcheville sites, also committed sanofi-aventis to partially funding the operation of these sites for a limited period in return for a job protection guarantee;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | measures announced by sanofi-aventis in 2010 intended to migrate the Groups chemical industrial facilities in France towards biotechnologies and
vaccine production, and to anticipate the fall in production volumes following the expiry of patent protection for major pharmaceutical products;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | ongoing measures to adjust the Groups sales forces in France, other European countries, and the United States;
| | - |  | ---------------------------------------------------------------------------------------------------------------



| |  |  | the impact of pension reforms on existing early retirement plans in France.
| | - |  | ---------------------------------------------------------------------------



In 2009, restructuring costs related primarily to measures announced by sanofi-aventis in June 2009 aimed at
transforming Research and Development operations to encourage innovation, and adapting central support functions so as to streamline the organizational structure. These costs mainly comprised employee-related expenses, in the form of early
retirement benefits and of termination benefits under voluntary redundancy plans. In France, these plans affected approximately 1,000 jobs in Research and Development and 450 jobs in central support functions.



Restructuring costs for 2009 also included amounts relating
to transformation plans announced in other countries. The Research and Development transformation plan is a global project, which also affects the United States, the United Kingdom and Japan.



To a lesser extent, restructuring costs for 2009 reflected ongoing measures taken by sanofi-aventis to adapt
its industrial facilities in Europe and adjust its sales forces.



In 2008, restructuring costs related primarily to adaptation of industrial facilities in France and to measures taken by sanofi-aventis to adjust its sales force to reflect changing pharmaceutical market
conditions in various European countries  mainly France, Italy, Spain and Portugal  and in the United States.



D.28. Gains and losses on disposals, and litigation



In 2010, this line item reported an expense of 138 million, relating to an adjustment to vendors guarantee provisions in
connection with past divestments.



Sanofi-aventis
made no major divestments during 2010, 2009 or 2008.



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Year ended December 31, 2010



In 2008, this item included 76 million of reversals of provisions in respect
of litigation in the United States on pricing and market practices (see Note D.22.c) Government Investigations, Competition Law and Regulatory Claims).



D.29. Financial income and expenses



Financial income and expenses break down as follows:



|                                                           |  |                            |      |   |                            |  |      |                            |  |  |      |    
|---------------------------------------------------------- |  | -------------------------- | ---- | - | -------------------------- |  | ---- | -------------------------- |  |  | ---- | ---
|( million)                                                |  | Year endedDecember 31,2010 |      |   | Year endedDecember 31,2009 |  |      | Year endedDecember 31,2008 | 
|Cost of debt(1)                                            |  |                            | (385 | ) |                            |  | (310 | )                          |  |  | (315 | )  
|Interest income                                            |  |                            | 61   |   |                            |  | 88   |                            |  |  | 132  |    
|Cost of debt, net of cash and cash equivalents             |  |                            | (324 | ) |                            |  | (222 | )                          |  |  | (183 | )  
|Non-operating foreign exchange gains/(losses)              |  |                            | (20  | ) |                            |  | (67  | )                          |  |  | (74  | )  
|Unwinding of discount on provisions(2)                     |  |                            | (68  | ) |                            |  | (42  | )                          |  |  | (37  | )  
|Gains/(losses) on disposals of financial assets            |  |                            | 61   |   |                            |  | 1    |                            |  |  | 41   | (3)
|Impairment losses on financial assets, net of reversals(4) |  |                            | (6   | ) |                            |  | (2   | )                          |  |  | (8   | )  
|Other items                                                |  |                            | (5   | ) |                            |  | 32   |                            |  |  | 29   |    
|Net financial income/(expenses)                            |  |                            | (362 | ) |                            |  | (300 | )                          |  |  | (232 | )  
|comprising:Financial expenses                              |  |                            | (467 | ) |                            |  | (324 | )                          |  |  | (335 | )  
|Financial
income                                           |  |                            | 105  |   |                            |  | 24   |                            |  |  | 103  |    



|(1) | Includes gains/losses on interest rate derivatives used to hedge debt:
7 million gain in 2010, 25 million gain in 2009, 2 million loss in 2008.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Primarily provisions for environmental risks.
|--- | ---------------------------------------------

|(3) | Includes 38 million from the sale of the investment in Millennium in
2008 (see Note D.7.).
|--- | -------------------------------------------------------------------------------------------

|(4) | Primarily available-for-sale financial assets.
|--- | ----------------------------------------------



The impact of the
ineffective portion of hedging relationships was not material in 2010, 2009 or 2008.



D.30. Income tax expense



The Group has opted for tax consolidations in a number of countries, principally France, Germany, the United Kingdom and the United States.



The table below shows the split of income tax expense between current and deferred taxes:



|               |  |                            |        |   |                            |  |        |                            |  |  |        |  
|-------------- |  | -------------------------- | ------ | - | -------------------------- |  | ------ | -------------------------- |  |  | ------ | -
|( million)    |  | Year endedDecember 31,2010 |        |   | Year endedDecember 31,2009 |  |        | Year endedDecember 31,2008 | 
|Current taxes  |  |                            | (2,758 | ) |                            |  | (2,531 | )                          |  |  | (2,140 | )
|Deferred taxes |  |                            | 1,516  |   |                            |  | 1,167  |                            |  |  | 1,458  |  
|Total          |  |                            | (1,242 | ) |                            |  | (1,364 | )                          |  |  | (682   | )



F-110



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



The difference between the effective tax rate and the standard corporate income tax rate
applicable in France is explained as follows:



|                                                                                                                                              |  |                            |     |   |                            |  |    |                            |  |  |     |  
|--------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------- | --- | - | -------------------------- |  | -- | -------------------------- |  |  | --- | -
|(as a percentage)                                                                                                                             |  | Year endedDecember 31,2010 |     |   | Year endedDecember 31,2009 |  |    | Year endedDecember 31,2008 | 
|Standard tax rate applicable in France                                                                                                        |  |                            | 34  |   |                            |  | 34 |                            |  |  | 34  |  
|Impact of reduced-rate income tax on royalties in France                                                                                      |  |                            | (11 | ) |                            |  | (9 | )                          |  |  | (12 | )
|Impact of change in net deferred tax liabilities as a result of changes in tax rates(1)                                                       |  |                            |    |   |                            |  | 1  |                            |  |  |    |  
|Impact of the ratification of the Franco-American treaty on deferred tax liabilities relating to tax cost of distributions made from reserves |  |                            |    |   |                            |  | (2 | )                          |  |  |    |  
|Impact of tax borne by BMS for the territory managed by sanofi-aventis (see Note D.32.)                                                       |  |                            | (2  | ) |                            |  | (3 | )                          |  |  | (4  | )
|Other items                                                                                                                                   |  |                            | 1   |   |                            |  | 1  |                            |  |  | (2  | )
|Effective tax rate                                                                                                                            |  |                            | 22  |   |                            |  | 22 |                            |  |  | 16  |  



|(1) | In 2009, mainly the reform of local business taxes in France.
|--- | -------------------------------------------------------------



Changes in the line Impact of reduced-rate income tax on royalties in France are mainly due to significant
year-on-year fluctuations in pre-tax profits in 2010, 2009 and 2008. The year-on-year change in 2010 also reflects the impact of the strong performance of Plavix® in the United States, and the resulting increase in royalty income.



The Other items line includes (i) the effect of differences between tax rates applicable in France and those applicable
in other jurisdictions; (ii) the impact of the new CVAE valued added business tax in France from January 1, 2010; (iii) the impact of reassessing certain of the Groups tax exposures; and (iv) the impact on the effective tax
rate of amortization and impairment charged against intangible assets.



D.31. Share of profit/loss of associates and joint ventures



This item mainly comprises the share of co-promotion profits attributable to sanofi-aventis for territories covered by entities
majority-owned by BMS (see Note C.1.). The impact of the BMS alliance in 2010 was 1,551 million, before deducting the tax effect of 571 million (2009: 1,229 million, tax effect 444 million; 2008:
984 million, tax effect 361 million).



It also includes the share of profits or losses from other associates and joint ventures (2 million loss in 2010, 29 million profit in 2009, 69 million profit in 2008). These
figures include the effects of the Aventis acquisition (amortization and impairment of intangible assets).



In accordance with IFRS 5, the share of profits from Merial for 2008 has been retrospectively reclassified to the line Net income
from the held-for-exchange Merial business (see Note D.8. Assets held for sale or exchange).



D.32. Net income attributable to non-controlling interests



This line includes the share of co-promotion profits attributable to BMS for territories covered by entities majority-owned by
sanofi-aventis (see Note C.1.). The amount involved was 237 million in 2010, 405 million in 2009, and 422 million in 2008. There is no tax effect, because BMS receives its share before tax.



It also includes the share of net income attributable to
other non-controlling interests (17 million in 2010, 21 million in 2009, and 19 million in 2008).



F-111



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



D.33. Related party transactions



The principal related parties of sanofi-aventis are companies over which the Group has significant influence,
joint ventures, key management personnel, and principal shareholders.



The Group has not entered into any transactions with any key management personnel. Financial relations with the Groups principal shareholders, in particular the Total group, fall within the ordinary
course of business and were immaterial in the years ended December 31, 2010, December 31, 2009 and December 31, 2008.



Details of transactions with related companies are disclosed in Note D.6.



Key management personnel include corporate officers (including three directors during 2010 and 2009, and four
directors during 2008, covered by supplementary pension plans: see Item 6.B.) and the members of the Executive Committee (9 members during 2010 and 2009, and 7 during 2008.)



The table below shows, by type, the compensation paid to key
management personnel:



|                                         |  |                            |    |  |                            |  |    |                            |  |  |    | 
|---------------------------------------- |  | -------------------------- | -- |  | -------------------------- |  | -- | -------------------------- |  |  | -- | 
|( million)                              |  | Year endedDecember 31,2010 |    |  | Year endedDecember 31,2009 |  |    | Year endedDecember 31,2008 | 
|Short-term benefits(1)                   |  |                            | 23 |  |                            |  | 22 |                            |  |  | 18 | 
|Post-employment benefits(2)              |  |                            | 12 |  |                            |  | 11 |                            |  |  | 12 | 
|Share-based payment(3)                   |  |                            | 6  |  |                            |  | 5  |                            |  |  | 7  | 
|Total recognized in the income statement |  |                            | 41 |  |                            |  | 38 |                            |  |  | 37 | 





|(1) | Compensation, employers social security contributions, directors
attendance fees, and any termination benefits.
|--- | -----------------------------------------------------------------------------------------------------------------

|(2) | Estimated pension cost, calculated in accordance with IAS 19.
|--- | -------------------------------------------------------------

|(3) | Stock option expense computed using the Black-Scholes model.
|--- | ------------------------------------------------------------



The aggregate amount
of supplementary pension obligations to corporate officers and key management personnel was 130 million at December 31, 2010, versus 149 million at December 31, 2009 and 157 million at December 31,
2008. The aggregate amount of lump-sum retirement benefits payable to corporate officers and key management personnel at December 31, 2010 was 5 million, versus 10 million at December 31, 2009 and 8 million
at December 31, 2008.



D.34. Split of net sales



Credit risk is the risk that customers
(wholesalers, distributors, pharmacies, hospitals, clinics or government agencies) may fail to pay their debts. The Group manages credit risk by pre-vetting customers in order to set credit limits and risk levels and asking for guarantees or
insurance where necessary, performing controls, and monitoring qualitative and quantitative indicators of accounts receivable balances such as the period of credit taken and overdue payments.



Customer credit risk also arises as a result of the concentration of the Groups sales with its largest
customers, in particular certain wholesalers in the United States. The Groups three largest customers respectively accounted for approximately 7.6%, 7.0% and 6.0% of gross sales in 2010.



F-112



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Net sales



Net sales of sanofi-aventis comprise net sales generated by the Pharmaceuticals segment and net sales generated
by the Vaccines segment. The table below shows net sales of flagship products and other major pharmaceutical products:



|                                       |  |                        |        |  |      |  |        |      |  |  |        | 
|-------------------------------------- |  | ---------------------- | ------ |  | ---- |  | ------ | ---- |  |  | ------ | 
|                                       |  | Year ended December 31 |       
|( million)                            |  | 2010                   |        |  | 2009 |  |        | 2008 | 
|Lantus®                                |  |                        | 3,510  |  |      |  | 3,080  |      |  |  | 2,450  | 
|Apidra®                                |  |                        | 177    |  |      |  | 137    |      |  |  | 98     | 
|Amaryl®                                |  |                        | 478    |  |      |  | 416    |      |  |  | 379    | 
|Insuman®                               |  |                        | 133    |  |      |  | 131    |      |  |  | 143    | 
|Sub-total: Diabetes                    |  |                        | 4,298  |  |      |  | 3,764  |      |  |  | 3,070  | 
|Lovenox®                               |  |                        | 2,806  |  |      |  | 3,043  |      |  |  | 2,738  | 
|Taxotere®                              |  |                        | 2,122  |  |      |  | 2,177  |      |  |  | 2,033  | 
|Plavix®                                |  |                        | 2,083  |  |      |  | 2,623  |      |  |  | 2,609  | 
|Aprovel®                               |  |                        | 1,327  |  |      |  | 1,236  |      |  |  | 1,202  | 
|Eloxatine®                             |  |                        | 427    |  |      |  | 957    |      |  |  | 1,345  | 
|Multaq®                                |  |                        | 172    |  |      |  | 25     |      |  |  |       | 
|Jevtana®                               |  |                        | 82     |  |      |  |       |      |  |  |       | 
|Stilnox®/ Ambien®/ Ambien® CR/ Myslee® |  |                        | 819    |  |      |  | 873    |      |  |  | 822    | 
|Allegra®                               |  |                        | 607    |  |      |  | 731    |      |  |  | 666    | 
|Copaxone®                              |  |                        | 513    |  |      |  | 467    |      |  |  | 622    | 
|Tritace®                               |  |                        | 410    |  |      |  | 429    |      |  |  | 491    | 
|Depakine®                              |  |                        | 372    |  |      |  | 329    |      |  |  | 322    | 
|Xatral®                                |  |                        | 296    |  |      |  | 296    |      |  |  | 319    | 
|Actonel®                               |  |                        | 238    |  |      |  | 264    |      |  |  | 330    | 
|Nasacort®                              |  |                        | 189    |  |      |  | 220    |      |  |  | 240    | 
|Other Products                         |  |                        | 6,064  |  |      |  | 5,947  |      |  |  | 6,341  | 
|Consumer Health Care                   |  |                        | 2,217  |  |      |  | 1,430  |      |  |  | 1,203  | 
|Generics                               |  |                        | 1,534  |  |      |  | 1,012  |      |  |  | 354    | 
|Total Pharmaceuticals                  |  |                        | 26,576 |  |      |  | 25,823 |      |  |  | 24,707 | 



Net sales of the principal product ranges of the Vaccines segment are shown below:



|                                                 |  |                        |       |  |      |  |       |      |  |  |       | 
|------------------------------------------------ |  | ---------------------- | ----- |  | ---- |  | ----- | ---- |  |  | ----- | 
|                                                 |  | Year ended December 31 |      
|( million)                                      |  | 2010                   |       |  | 2009 |  |       | 2008 | 
|Influenza Vaccines                               |  |                        | 1,297 |  |      |  | 1,062 |      |  |  | 736   | 
|of which seasonal vaccines                       |  |                        | 845   |  |      |  | 597   |      |  |  | 610   | 
|of which pandemic vaccines                       |  |                        | 452   |  |      |  | 465   |      |  |  | 126   | 
|Pediatric Combination and Poliomyelitis Vaccines |  |                        | 984   |  |      |  | 968   |      |  |  | 768   | 
|Meningitis/Pneumonia Vaccines                    |  |                        | 527   |  |      |  | 538   |      |  |  | 472   | 
|Adult Booster Vaccines                           |  |                        | 449   |  |      |  | 406   |      |  |  | 399   | 
|Travel and Endemics Vaccines                     |  |                        | 382   |  |      |  | 313   |      |  |  | 309   | 
|Other Vaccines                                   |  |                        | 169   |  |      |  | 196   |      |  |  | 177   | 
|Total Vaccines                                   |  |                        | 3,808 |  |      |  | 3,483 |      |  |  | 2,861 | 



F-113



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



D.35. Segment information



As indicated in Note B.26., sanofi-aventis has two operating
segments: the Pharmaceuticals segment and the Human Vaccines (Vaccines) segment. All other activities are combined in a separate segment, Other.



The Pharmaceuticals segment covers research, development, production and marketing of medicines. The sanofi-aventis pharmaceuticals
portfolio consists of flagship products, plus a broad range of prescription medicines, generic medicines, and consumer health products. This segment also includes all associates whose activities are related to pharmaceuticals, in particular the
entities majority owned by BMS.



The Human
Vaccines segment is wholly dedicated to vaccines, including research, development, production and marketing. This segment includes the Sanofi Pasteur MSD joint venture.



The Other segment includes all segments that are not
reportable segments within the meaning of IFRS 8. This segment includes the Groups interest in the Yves Rocher group, the Animal Health business (Merial), and the impact of retained commitments in respect of divested activities.



Inter-segment transactions are not material.



D.35.1. Segment results



Sanofi-aventis reports segment results on the basis of
Business operating income. This indicator, adopted in order to comply with IFRS 8, is used internally to measure operational performance and allocate resources.



Business operating income is derived from
operating income, adjusted as follows:



| |  |  | amortization charged against intangible assets is eliminated;
| | - |  | -------------------------------------------------------------



| |  |  | impairment losses charged against intangible assets are eliminated;
| | - |  | -------------------------------------------------------------------



| |  |  | restructuring costs are eliminated;
| | - |  | -----------------------------------



| |  |  | gains and losses on disposals, and litigation, are eliminated;
| | - |  | --------------------------------------------------------------



| |  |  | the share of profits/losses of associates and joint ventures is added, and net income attributable to non-controlling interests is deducted;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | other acquisition-related effects (primarily the workdown of acquired inventories remeasured at fair value at the acquisition date, and the impact of
acquisitions on investments in associates and joint ventures) are eliminated;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | restructuring costs relating to associates and joint ventures are eliminated.
| | - |  | -----------------------------------------------------------------------------



F-114



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Segment results are shown in the tables below:



|                                                         |  |                 |        |   |          |  |        |       |  |  |       |   |  |  |        |  
|-------------------------------------------------------- |  | --------------- | ------ | - | -------- |  | ------ | ----- |  |  | ----- | - |  |  | ------ | -
|                                                         |  | 2010            |       
|( million)                                              |  | Pharmaceuticals |        |   | Vaccines |  |        | Other |  |  | Total |  
|Net sales                                                |  |                 | 26,576 |   |          |  | 3,808  |       |  |  |      |   |  |  | 30,384 |  
|Other revenues                                           |  |                 | 1,623  |   |          |  | 28     |       |  |  |      |   |  |  | 1,651  |  
|Cost of sales                                            |  |                 | (7,316 | ) |          |  | (1,371 | )     |  |  |      |   |  |  | (8,687 | )
|Research and development expenses                        |  |                 | (3,884 | ) |          |  | (517   | )     |  |  |      |   |  |  | (4,401 | )
|Selling and general expenses                             |  |                 | (6,962 | ) |          |  | (603   | )     |  |  | (2    | ) |  |  | (7,567 | )
|Other operating income and expenses                      |  |                 | 177    |   |          |  | 14     |       |  |  | (108  | ) |  |  | 83     |  
|Share of profit/loss of associates and joint ventures(1) |  |                 | 1,009  |   |          |  | 19     |       |  |  | 8     |   |  |  | 1,036  |  
|Net income from the held-for-exchange Merial business    |  |                 |       |   |          |  |       |       |  |  | 418   |   |  |  | 418    |  
|Net income attributable to non-controlling interests     |  |                 | (258   | ) |          |  | 1      |       |  |  |      |   |  |  | (257   | )
|Business operating income                                |  |                 | 10,965 |   |          |  | 1,379  |       |  |  | 316   |   |  |  | 12,660 |  
|Financial income and expenses                            |  |                 |        |   |          |  |        |       |  |  |       |   |  |  | (362   | )
|Income tax expense                                       |  |                 |        |   |          |  |        |       |  |  |       |   |  |  | (3,083 | )
|Business net income                                      |  |                 |        |   |          |  |        |       |  |  |       |   |  |  | 9,215  |  



|(1) | Net of taxes
|--- | ------------



|                                                         |  |                 |        |   |          |  |        |       |  |  |       |   |  |  |        |  
|-------------------------------------------------------- |  | --------------- | ------ | - | -------- |  | ------ | ----- |  |  | ----- | - |  |  | ------ | -
|                                                         |  | 2009            |       
|( million)                                              |  | Pharmaceuticals |        |   | Vaccines |  |        | Other |  |  | Total |  
|Net sales                                                |  |                 | 25,823 |   |          |  | 3,483  |       |  |  |      |   |  |  | 29,306 |  
|Other revenues                                           |  |                 | 1,412  |   |          |  | 31     |       |  |  |      |   |  |  | 1,443  |  
|Cost of sales                                            |  |                 | (6,527 | ) |          |  | (1,326 | )     |  |  |      |   |  |  | (7,853 | )
|Research and development expenses                        |  |                 | (4,091 | ) |          |  | (491   | )     |  |  | (1    | ) |  |  | (4,583 | )
|Selling and general expenses                             |  |                 | (6,762 | ) |          |  | (561   | )     |  |  | (2    | ) |  |  | (7,325 | )
|Other operating income and expenses                      |  |                 | 387    |   |          |  | (3     | )     |  |  | 1     |   |  |  | 385    |  
|Share of profit/loss of associates and joint ventures(1) |  |                 | 792    |   |          |  | 41     |       |  |  | 8     |   |  |  | 841    |  
|Net income from the held-for-exchange Merial business    |  |                 |       |   |          |  |       |       |  |  | 241   |   |  |  | 241    |  
|Net income attributable to non-controlling interests     |  |                 | (426   | ) |          |  | (1     | )     |  |  |      |   |  |  | (427   | )
|Business operating income                                |  |                 | 10,608 |   |          |  | 1,173  |       |  |  | 247   |   |  |  | 12,028 |  
|Financial income and expenses                            |  |                 |        |   |          |  |        |       |  |  |       |   |  |  | (300   | )
|Income tax expense                                       |  |                 |        |   |          |  |        |       |  |  |       |   |  |  | (3,099 | )
|Business net income                                      |  |                 |        |   |          |  |        |       |  |  |       |   |  |  | 8,629  |  



|(1) | Net of taxes
|--- | ------------



F-115



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



|                                                         |  |                 |        |   |          |  |        |       |  |  |       |   |  |  |        |  
|-------------------------------------------------------- |  | --------------- | ------ | - | -------- |  | ------ | ----- |  |  | ----- | - |  |  | ------ | -
|                                                         |  | 2008            |       
|( million)                                              |  | Pharmaceuticals |        |   | Vaccines |  |        | Other |  |  | Total |  
|Net sales                                                |  |                 | 24,707 |   |          |  | 2,861  |       |  |  |      |   |  |  | 27,568 |  
|Other revenues                                           |  |                 | 1,208  |   |          |  | 41     |       |  |  |      |   |  |  | 1,249  |  
|Cost of sales                                            |  |                 | (6,231 | ) |          |  | (1,104 | )     |  |  |      |   |  |  | (7,335 | )
|Research and development expenses                        |  |                 | (4,150 | ) |          |  | (425   | )     |  |  |      |   |  |  | (4,575 | )
|Selling and general expenses                             |  |                 | (6,662 | ) |          |  | (520   | )     |  |  | 14    |   |  |  | (7,168 | )
|Other operating income and expenses                      |  |                 | 297    |   |          |  | 1      |       |  |  | (95   | ) |  |  | 203    |  
|Share of profit/loss of associates and joint ventures(1) |  |                 | 671    |   |          |  | 28     |       |  |  | 21    |   |  |  | 720    |  
|Net income from the held-for-exchange Merial business    |  |                 |       |   |          |  |       |       |  |  | 170   |   |  |  | 170    |  
|Net income attributable to non-controlling interests     |  |                 | (441   | ) |          |  |       |       |  |  |      |   |  |  | (441   | )
|Business operating income                                |  |                 | 9,399  |   |          |  | 882    |       |  |  | 110   |   |  |  | 10,391 |  
|Financial income and expenses                            |  |                 |        |   |          |  |        |       |  |  |       |   |  |  | (270   | )
|Income tax expense                                       |  |                 |        |   |          |  |        |       |  |  |       |   |  |  | (2,807 | )
|Business net income                                      |  |                 |        |   |          |  |        |       |  |  |       |   |  |  | 7,314  |  



|(1) | Net of taxes
|--- | ------------



Business net income is determined by taking
Business operating income and adding financial income and deducting financial expenses, including the related income tax effects.



Business net income is defined as Net income attributable to equity holders of sanofi-aventisexcluding
(i) amortization of intangible assets; (ii) impairment of intangible assets; (iii) other impacts associated with acquisitions (including impacts of acquisitions on associates and joint ventures); (iv) restructuring costs
(including restructuring costs relating to associates and joint ventures), gains and losses on disposals of non-current assets, and costs or provisions associated with litigation; (v) the tax effect related to the items listed in
(i) through (iv), as well as (vi) effects of major tax disputes and (vii) the share of non-controlling interests in items (i) through (vi). The items listed in (iv)  except for restructuring costs related to associates
and joint ventures  correspond to those reported in the line items Restructuring costsandGains and losses on disposals, and litigation, as defined in Note B.20. to the consolidated financial statements.



F-116



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



A reconciliation of Business net income to Net income attributable to
equity holders of sanofi-aventis is set forth below:



|                                                            |  |                                                                                                                                                |       |  |                            |   |       |                            |        |   |       |  |        |  
|----------------------------------------------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------- | ----- |  | -------------------------- | - | ----- | -------------------------- | ------ | - | ----- |  | ------ | -
|( million)                                                 |  | Year endedDecember 31,2010                                                                                                                     |       |  | Year endedDecember 31,2009 |   |       | Year endedDecember 31,2008 |       
|Business net income                                         |  |                                                                                                                                                | 9,215 |  |                            |   | 8,629 |                            |        |   | 7,314 | 
|(i)                                                         |  | Amortization of intangible assets                                                                                                              |       |  | (3,529                     | ) |       |                            | (3,528 | ) |       |  | (3,483 | )
|(ii)                                                        |  | Impairment of intangible assets                                                                                                                |       |  | (433                       | ) |       |                            | (372   | ) |       |  | (1,554 | )
|(iii)                                                       |  | Expenses arising from the impact of acquisitions on inventories(1)                                                                             |       |  | (30                        | ) |       |                            | (27    | ) |       |  | (2     | )
|(iv)                                                        |  | Restructuring costs                                                                                                                            |       |  | (1,372                     | ) |       |                            | (1,080 | ) |       |  | (585   | )
|(iii)/(iv)                                                  |  | Other items(2)                                                                                                                                 |       |  | (138                       | ) |       |                            |       |   |       |  | 114    |  
|(v)                                                         |  | Tax effects of:                                                                                                                                |       |  | 1,841                      |   |       |                            | 1,629  |   |       |  | 1,904  |  
|                                                            |  |  amortization of intangible assets                                                                                                            |       |  | 1,181                      |   |       |                            | 1,126  |   |       |  | 1,189  |  
|                                                            |  |  impairment of intangible assets                                                                                                              |       |  | 143                        |   |       |                            | 136    |   |       |  | 537    |  
|                                                            |  |  expenses arising on the workdown of acquired inventories                                                                                     |       |  | 9                          |   |       |                            | 7      |   |       |  | 1      |  
|                                                            |  |  restructuring costs                                                                                                                          |       |  | 462                        |   |       |                            | 360    |   |       |  | 196    |  
|                                                            |  |  other items                                                                                                                                  |       |  | 46                         |   |       |                            |       |   |       |  | (19    | )
|(iii)/(vi)                                                  |  | Other tax items(3)                                                                                                                             |       |  |                           |   |       |                            | 106    |   |       |  | 221    |  
|(vii)                                                       |  | Share of items listed above attributable to non-controlling interests                                                                          |       |  | 3                          |   |       |                            | 1      |   |       |  |       |  
|(iii)                                                       |  | Expenses arising from the impact of the Merial acquisition(4)                                                                                  |       |  | (32                        | ) |       |                            | (66    | ) |       |  | (50    | )
|(iii)/(iv)                                                  |  | Restructuring costs of associates and joint ventures, and expenses arising from the impact of acquisitions on associates and joint ventures(5) |       |  | (58                        | ) |       |                            | (27    | ) |       |  | (28    | )
|Net income attributable to equity holders of
sanofi-aventis |  |                                                                                                                                                | 5,467 |  |                            |   | 5,265 |                            |        |   | 3,851 | 



|(1) | Workdown of inventories remeasured at fair value at the acquisition date.
|--- | -------------------------------------------------------------------------

|(2) | Other items comprise:
|--- | ---------------------

|                                               |  |  |      |   |  |  |  |  |  |  |    | 
|---------------------------------------------- |  |  | ---- | - |  |  |  |  |  |  | -- | 
|Gain on sale of investment in Millennium       |  |  |      |   |  |  |  |  |  |  | 38 | 
|Reversals of/(charges to) provisions for risks |  |  | (138 | ) |  |  |  |  |  |  | 76 | 

|(3) | Other tax items comprise:
|--- | -------------------------

|                                                                                                 |  |  |  |     |  |  |  |  |  |  |     | 
|------------------------------------------------------------------------------------------------ |  |  |  | --- |  |  |  |  |  |  | --- | 
|Provisions for/settlements of tax disputes                                                       |  |  |  |     |  |  |  |  |  |  | 221 | 
|Reversal of deferred taxes following ratification of the Franco-American Treaty (see Note D.30.) |  |  |  | 106 |  |  |  |  | 

|(4) | This line comprises: until September 17, 2009, amortization and impairment
charged against the intangible assets of Merial; and from September 18, 2009, (i) the impact of the discontinuation of depreciation of the property, plant and equipment of Merial in accordance with IFRS 5 (see Note B.7.) and (ii) the
expense arising from the workdown of inventories remeasured at fair value at the acquisition date.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(5) | This line shows the portion of major restructuring costs incurred by associates
and joint ventures, and expenses arising from the impact of acquisitions on associates and joint ventures (workdown of acquired inventories, amortization and impairment of intangible assets, and impairment of goodwill).
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



D.35.2. Other segment information



The tables below show the split by operating
segment of (i) the carrying amount of investments in associates and joint ventures, (ii) acquisitions of property, plant and equipment, and (iii) acquisitions of intangible assets.



The principal associates and joint ventures are: for the
Pharmaceuticals segment, the entities majority owned by BMS (see Note C.1.), Handok, InfraServ, and (in 2008) Zentiva; for the Vaccines segment, Sanofi Pasteur MSD; and for the Other segment, Merial and Yves Rocher in 2008, and Yves Rocher in 2009
and 2010.



F-117



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



Acquisitions of intangible assets and property, plant and equipment correspond to
acquisitions made during the period.



|                                              |  |                 |     |  |          |  |     |       |  |  |       |  |  |  |       | 
|--------------------------------------------- |  | --------------- | --- |  | -------- |  | --- | ----- |  |  | ----- |  |  |  | ----- | 
|                                              |  | 2010            |    
|( million)                                   |  | Pharmaceuticals |     |  | Vaccines |  |     | Other |  |  | Total | 
|Investments in associates and joint ventures  |  |                 | 446 |  |          |  | 350 |       |  |  | 128   |  |  |  | 924   | 
|Acquisitions of property, plant and equipment |  |                 | 779 |  |          |  | 416 |       |  |  |      |  |  |  | 1,195 | 
|Acquisitions of intangible assets             |  |                 | 335 |  |          |  | 43  |       |  |  |      |  |  |  | 378   | 



|                                              |  |                 |     |  |          |  |     |       |  |  |       |  |  |  |       | 
|--------------------------------------------- |  | --------------- | --- |  | -------- |  | --- | ----- |  |  | ----- |  |  |  | ----- | 
|                                              |  | 2009            |    
|( million)                                   |  | Pharmaceuticals |     |  | Vaccines |  |     | Other |  |  | Total | 
|Investments in associates and joint ventures  |  |                 | 420 |  |          |  | 412 |       |  |  | 123   |  |  |  | 955   | 
|Acquisitions of property, plant and equipment |  |                 | 940 |  |          |  | 465 |       |  |  |      |  |  |  | 1,405 | 
|Acquisitions of intangible assets             |  |                 | 364 |  |          |  | 16  |       |  |  |      |  |  |  | 380   | 



|                                              |  |                 |     |  |          |  |     |       |  |  |       |  |  |  |       | 
|--------------------------------------------- |  | --------------- | --- |  | -------- |  | --- | ----- |  |  | ----- |  |  |  | ----- | 
|                                              |  | 2008            |    
|( million)                                   |  | Pharmaceuticals |     |  | Vaccines |  |     | Other |  |  | Total | 
|Investments in associates and joint ventures  |  |                 | 706 |  |          |  | 431 |       |  |  | 1,322 |  |  |  | 2,459 | 
|Acquisitions of property, plant and equipment |  |                 | 967 |  |          |  | 375 |       |  |  |      |  |  |  | 1,342 | 
|Acquisitions of intangible assets             |  |                 | 225 |  |          |  | 39  |       |  |  |      |  |  |  | 264   | 



D.35.3. Information by geographical region



The geographical information on net sales provided below is based on the geographical location of the customer.



In accordance with IFRS 8, the non-current assets reported
below exclude financial instruments, deferred tax assets, and pre-funded pension obligations.



|                                 |  |       |        |  |        |  |        |                |  |  |              |  |  |                       |        |  |                |  |       |  |  |  |       | 
|-------------------------------- |  | ----- | ------ |  | ------ |  | ------ | -------------- |  |  | ------------ |  |  | --------------------- | ------ |  | -------------- |  | ----- |  |  |  | ----- | 
|                                 |  |       |        |  | 2010   | 
|( million)                      |  | Total |        |  | Europe |  |        | Of whichFrance |  |  | NorthAmerica |  |  | Of whichUnited States |        |  | Othercountries | 
|Net sales                        |  |       | 30,384 |  |        |  | 11,609 |                |  |  | 2,922        |  |  |                       | 9,484  |  |                |  | 8,968 |  |  |  | 9,291 | 
|Non-current assets:              |  |       |        |  |        |  |        |                |  |  |              |  |  |                       |        |  |                |  |       |  |  |  |       | 
|  property, plant and equipment |  |       | 8,155  |  |        |  | 5,764  |                |  |  | 3,603        |  |  |                       | 1,510  |  |                |  | 1,091 |  |  |  | 881   | 
|  intangible assets             |  |       | 12,479 |  |        |  | 3,773  |                |  |  |              |  |  |                       | 5,835  |  |                |  |       |  |  |  | 2,871 | 
|  goodwill                      |  |       | 31,932 |  |        |  | 13,718 |                |  |  |              |  |  |                       | 13,264 |  |                |  |       |  |  |  | 4,950 | 



|                                 |  |       |        |  |        |  |        |                |  |  |              |  |  |                       |        |  |                |  |       |  |  |  |       | 
|-------------------------------- |  | ----- | ------ |  | ------ |  | ------ | -------------- |  |  | ------------ |  |  | --------------------- | ------ |  | -------------- |  | ----- |  |  |  | ----- | 
|                                 |  |       |        |  | 2009   | 
|( million)                      |  | Total |        |  | Europe |  |        | Of whichFrance |  |  | NorthAmerica |  |  | Of whichUnited States |        |  | Othercountries | 
|Net sales                        |  |       | 29,306 |  |        |  | 12,059 |                |  |  | 3,206        |  |  |                       | 9,870  |  |                |  | 9,426 |  |  |  | 7,377 | 
|Non-current assets:              |  |       |        |  |        |  |        |                |  |  |              |  |  |                       |        |  |                |  |       |  |  |  |       | 
|  property, plant and equipment |  |       | 7,830  |  |        |  | 5,734  |                |  |  | 3,436        |  |  |                       | 1,375  |  |                |  | 1,018 |  |  |  | 721   | 
|  intangible assets             |  |       | 13,747 |  |        |  | 4,636  |                |  |  |              |  |  |                       | 5,930  |  |                |  |       |  |  |  | 3,181 | 
|  goodwill                      |  |       | 29,733 |  |        |  | 13,528 |                |  |  |              |  |  |                       | 11,419 |  |                |  |       |  |  |  | 4,786 | 



F-118



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



|                                 |  |       |        |  |        |  |        |                |  |  |              |  |  |                       |        |  |                |  |       |  |  |  |       | 
|-------------------------------- |  | ----- | ------ |  | ------ |  | ------ | -------------- |  |  | ------------ |  |  | --------------------- | ------ |  | -------------- |  | ----- |  |  |  | ----- | 
|                                 |  |       |        |  | 2008   | 
|( million)                      |  | Total |        |  | Europe |  |        | Of whichFrance |  |  | NorthAmerica |  |  | Of whichUnited States |        |  | Othercountries | 
|Net sales                        |  |       | 27,568 |  |        |  | 12,096 |                |  |  | 3,447        |  |  |                       | 9,042  |  |                |  | 8,609 |  |  |  | 6,430 | 
|Non-current assets:              |  |       |        |  |        |  |        |                |  |  |              |  |  |                       |        |  |                |  |       |  |  |  |       | 
|  property, plant and equipment |  |       | 6,961  |  |        |  | 5,174  |                |  |  | 3,181        |  |  |                       | 1,320  |  |                |  | 1,042 |  |  |  | 467   | 
|  intangible assets             |  |       | 15,260 |  |        |  | 4,573  |                |  |  |              |  |  |                       | 7,429  |  |                |  |       |  |  |  | 3,258 | 
|  goodwill                      |  |       | 28,163 |  |        |  | 12,414 |                |  |  |              |  |  |                       | 11,750 |  |                |  |       |  |  |  | 3,999 | 



As described in Note D.5. to the consolidated financial statements, France is not a cash-generating unit. Consequently, information about
goodwill is provided for Europe.



F-119



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##### Table of Contents

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



E. PRINCIPAL ACCOUNTANTS FEES AND SERVICES



PricewaterhouseCoopers Audit and Ernst & Young
Audit served as independent auditors of sanofi-aventis for the year ended December 31, 2010 and for all other reporting periods covered by this annual report on Form 20-F. The table below shows fees charged by these firms and member firms
of their networks to sanofi-aventis and other consolidated companies in the years ended December 31, 2010 and 2009.



|                                                                             |  |               |      |  |                        |  |     |        |  |  |      |  |  |        |     |   |   |  |      |        |  |  |     |   |  |  |      |     |  |  |     |  
|---------------------------------------------------------------------------- |  | ------------- | ---- |  | ---------------------- |  | --- | ------ |  |  | ---- |  |  | ------ | --- | - | - |  | ---- | ------ |  |  | --- | - |  |  | ---- | --- |  |  | --- | -
|                                                                             |  | Ernst & Young |      |  | PricewaterhouseCoopers | 
|                                                                             |  | 2010          |      |  |                        |  |     | 2009   |  |  |      |  |  | 2010   |     |   |   |  |      | 2009   |  |  |     |  
|( million)                                                                  |  | Amount        |      |  | %                      |  |     | Amount |  |  | %    |  |  | Amount |     |   | % |  |      | Amount |  |  | %   |  
|Audit                                                                        |  |               |      |  |                        |  |     |        |  |  |      |  |  |        |     |   |   |  |      |        |  |  |     |   |  |  |      |     |  |  |     |  
|Audit opinion, review of statutory and consolidated financial statements (1) |  |               | 12.8 |  |                        |  | 92  | %      |  |  | 13.1 |  |  |        | 93  | % |   |  | 13.5 |        |  |  | 93  | % |  |  | 14.1 |     |  |  | 95  | %
|- of which sanofi-aventis S.A.                                               |  |               | 3.7  |  |                        |  |     |        |  |  | 4.1  |  |  |        |     |   |   |  | 3.7  |        |  |  |     |   |  |  | 4.0  |     |  |  |     |  
|- of which consolidated subsidiaries                                         |  |               | 9.1  |  |                        |  |     |        |  |  | 9.0  |  |  |        |     |   |   |  | 9.8  | (3)    |  |  |     |   |  |  | 10.1 | (3) |  |  |     |  
|Other audit-related services (2)                                             |  |               | 1.0  |  |                        |  | 7   | %      |  |  | 1.0  |  |  |        | 7   | % |   |  | 0.7  |        |  |  | 5   | % |  |  | 0.8  |     |  |  | 5   | %
|- of which sanofi-aventis S.A.                                               |  |               |     |  |                        |  |     |        |  |  | 0.1  |  |  |        |     |   |   |  |     |        |  |  |     |   |  |  | 0.1  |     |  |  |     |  
|- of which consolidated subsidiaries                                         |  |               | 1.0  |  |                        |  |     |        |  |  | 0.9  |  |  |        |     |   |   |  | 0.7  |        |  |  |     |   |  |  | 0.7  |     |  |  |     |  
|Sub-total                                                                    |  |               | 13.8 |  |                        |  | 99  | %      |  |  | 14.1 |  |  |        | 100 | % |   |  | 14.2 |        |  |  | 98  | % |  |  | 14.9 |     |  |  | 100 | %
|Non-audit services                                                           |  |               |      |  |                        |  |     |        |  |  |      |  |  |        |     |   |   |  |      |        |  |  |     |   |  |  |      |     |  |  |     |  
|Tax                                                                          |  |               | 0.1  |  |                        |  |     |        |  |  |     |  |  |        |     |   |   |  | 0.3  |        |  |  |     |   |  |  |     |     |  |  |     |  
|Other                                                                        |  |               |     |  |                        |  |     |        |  |  |     |  |  |        |     |   |   |  |     |        |  |  |     |   |  |  |     |     |  |  |     |  
|Sub-total                                                                    |  |               | 0.1  |  |                        |  | 1   | %      |  |  |     |  |  |        |     |   |   |  | 0.3  |        |  |  | 2   | % |  |  |     |     |  |  |     |  
|TOTAL                                                                        |  |               | 13.9 |  |                        |  | 100 | %      |  |  | 14.1 |  |  |        | 100 | % |   |  | 14.5 |        |  |  | 100 | % |  |  | 14.9 |     |  |  | 100 | %



|(1) | Professional services rendered for the audit and review of the consolidated
financial statements of sanofi-aventis, statutory audits of the financial statements of sanofi-aventis and its subsidiaries, compliance with local regulations, and review of documents filed with the AMF and the SEC (including services normally
provided by independent experts of the audit firms in connection with the audit).
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Services that are normally performed by the independent accountants, ancillary to
audit services.
|--- | -------------------------------------------------------------------------------------------------

|(3) | Includes audit fees of 1.8 million relating to Merial for 2010, and
1.7 million for 2009.
|--- | -------------------------------------------------------------------------------------------



Audit Committee Pre-approval and Procedures



The Group Audit Committee has adopted a policy and established certain procedures for the pre-approval of audit and other permitted
audit-related services, and for the pre-approval of permitted non-audit services to be provided by the independent auditors. In 2010, the Audit Committee established a budget breaking down permitted audit-related services and non-audit services, and
the related fees to be paid.



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



F. LIST OF PRINCIPAL COMPANIES INCLUDED IN THE CONSOLIDATION FOR THE
YEAR ENDED DECEMBER 31, 2010



F.1. Principal
fully-consolidated companies



The principal
companies in the Groups areas of operations and business segments are:



|                                                         |  |  |             |  |                      |  |      | 
|-------------------------------------------------------- |  |  | ----------- |  | -------------------- |  | ---- | 
|Europe                                                   |  |  |             |  | Financial interest
% | 
|Sanofi-Aventis Deutschland GmbH                          |  |  | Germany     |  |                      |  | 100  | 
|Hoechst GmbH                                             |  |  | Germany     |  |                      |  | 100  | 
|Winthrop Arzneimittel GmbH                               |  |  | Germany     |  |                      |  | 100  | 
|Zentiva Inhalationsprodukte GmbH                         |  |  | Germany     |  |                      |  | 100  | 
|Sanofi-Aventis Gmbh / Bristol-Myers Squibb GesmbH OHG(1) |  |  | Austria     |  |                      |  | 50.1 | 
|Sanofi-Aventis GmbH                                      |  |  | Austria     |  |                      |  | 100  | 
|Sanofi-Aventis Belgium                                   |  |  | Belgium     |  |                      |  | 100  | 
|Sanofi-Aventis Denmark A/S                               |  |  | Denmark     |  |                      |  | 100  | 
|Sanofi Winthrop BMS partnership (JV DK)(1)               |  |  | Denmark     |  |                      |  | 50.1 | 
|Sanofi-Aventis SA (Spain)                                |  |  | Spain       |  |                      |  | 100  | 
|Sanofi Winthrop BMS OY(1)                                |  |  | Finland     |  |                      |  | 50.1 | 
|Sanofi-Aventis OY                                        |  |  | Finland     |  |                      |  | 100  | 
|Sanofi-Aventis Europe S.A.S.                             |  |  | France      |  |                      |  | 100  | 
|Sanofi-Aventis Participations S.A.S.                     |  |  | France      |  |                      |  | 100  | 
|Sanofi Pasteur Participations S.A.                       |  |  | France      |  |                      |  | 100  | 
|Sanofi-Aventis Amérique du Nord S.A.S.                   |  |  | France      |  |                      |  | 100  | 
|Sanofi Pasteur Holding S.A.                              |  |  | France      |  |                      |  | 100  | 
|Aventis Pharma S.A.                                      |  |  | France      |  |                      |  | 100  | 
|Sanofi Pasteur S.A.                                      |  |  | France      |  |                      |  | 100  | 
|Aventis Agriculture S.A.                                 |  |  | France      |  |                      |  | 100  | 
|Fovea Pharmaceuticals S.A.                               |  |  | France      |  |                      |  | 100  | 
|Francopia S.A.R.L.                                       |  |  | France      |  |                      |  | 100  | 
|Winthrop Médicaments S.A.                                |  |  | France      |  |                      |  | 100  | 
|Sanofi Chimie S.A.                                       |  |  | France      |  |                      |  | 100  | 
|Sanofi Participations S.A.S.                             |  |  | France      |  |                      |  | 100  | 
|Sanofi Pharma Bristol-Myers Squibb S.N.C.(1)             |  |  | France      |  |                      |  | 50.1 | 
|Sanofi-Aventis S.A.                                      |  |  | France      |  |                      |  | 100  | 
|Sanofi-Aventis France S.A.                               |  |  | France      |  |                      |  | 100  | 
|Sanofi-Aventis Groupe S.A.                               |  |  | France      |  |                      |  | 100  | 
|Sanofi-Aventis Recherche et Développement S.A.           |  |  | France      |  |                      |  | 100  | 
|Sanofi Winthrop Industrie S.A.                           |  |  | France      |  |                      |  | 100  | 
|Laboratoire Oenobiol S.A.S.                              |  |  | France      |  |                      |  | 100  | 
|Chattem Greece S.A.                                      |  |  | Greece      |  |                      |  | 100  | 
|Sanofi-Aventis A.E.B.E.                                  |  |  | Greece      |  |                      |  | 100  | 
|Chinoin Private Co. Ltd                                  |  |  | Hungary     |  |                      |  | 99.6 | 
|Sanofi-Aventis Private Co. Ltd                           |  |  | Hungary     |  |                      |  | 99.6 | 
|Chattem Global Consumer Products Limited                 |  |  | Ireland     |  |                      |  | 100  | 
|Carraig Insurance Ltd                                    |  |  | Ireland     |  |                      |  | 100  | 
|Sanofi-Aventis Ireland Ltd                               |  |  | Ireland     |  |                      |  | 100  | 
|Sanofi-Aventis SpA                                       |  |  | Italy       |  |                      |  | 100  | 
|Sanofi-Aventis Norge AS                                  |  |  | Norway      |  |                      |  | 100  | 
|Sanofi Winthrop BMS partnership ANS(1)                   |  |  | Norway      |  |                      |  | 50.1 | 
|Sanofi-Aventis Netherlands B.V.                          |  |  | Netherlands |  |                      |  | 100  | 
|Sanofi Winthrop BMS VOF(1)                               |  |  | Netherlands |  |                      |  | 50.1 | 
|Sanofi-Aventis Sp z.o.o.                                 |  |  | Poland      |  |                      |  | 100  | 



|(1) | Partnership with Bristol-Myers Squibb (see Note C.1.).
|--- | ------------------------------------------------------



F-121



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



|                                                   |  |                |  |                      |      | 
|-------------------------------------------------- |  | -------------- |  | -------------------- | ---- | 
|Europe                                             |  |                |  | Financial interest
% |     
|Nepentes S.A.                                      |  | Poland         |  |                      | 100  | 
|Winthrop Farmaceutica Portugal LDA                 |  | Portugal       |  |                      | 100  | 
|Sanofi-Aventis Produtos Farmaceuticos LDA          |  | Portugal       |  |                      | 100  | 
|Sanofi Winthrop BMS AEIE(1)                        |  | Portugal       |  |                      | 50.1 | 
|Sanofi-Aventis s.r.o.                              |  | Czech Republic |  |                      | 100  | 
|Zentiva Group a.s.                                 |  | Czech Republic |  |                      | 100  | 
|Sanofi-Aventis Romania SRL                         |  | Romania        |  |                      | 100  | 
|Aventis Pharma Ltd                                 |  | United Kingdom |  |                      | 100  | 
|Chattem (U.K.) Limited                             |  | United Kingdom |  |                      | 100  | 
|Sanofi Pasteur Holding Ltd                         |  | United Kingdom |  |                      | 100  | 
|Sanofi-Synthélabo Ltd                              |  | United Kingdom |  |                      | 100  | 
|Sanofi-Synthélabo UK Ltd                           |  | United Kingdom |  |                      | 100  | 
|Winthrop Pharmaceuticals UK Ltd                    |  | United Kingdom |  |                      | 100  | 
|Fisons Limited                                     |  | United Kingdom |  |                      | 100  | 
|May and Baker Limited                              |  | United Kingdom |  |                      | 100  | 
|Aventis Pharma ZAO                                 |  | Russia         |  |                      | 100  | 
|Sanofi-Aventis Vostok                              |  | Russia         |  |                      | 51   | 
|Sanofi-Aventis Pharma Slovakia s.r.o.              |  | Slovakia       |  |                      | 100  | 
|Sanofi-Aventis AB                                  |  | Sweden         |  |                      | 100  | 
|Sanofi SA-AG                                       |  | Switzerland    |  |                      | 100  | 
|Sanofi-Aventis (Suisse) SA                         |  | Switzerland    |  |                      | 100  | 
|Sanofi-Aventis Ilaclari Limited Sirketi            |  | Turkey         |  |                      | 100  | 
|Winthrop Ilac Anonim Sirketi                       |  | Turkey         |  |                      | 100  | 
|Sanofi-Synthélabo Ilac AS                          |  | Turkey         |  |                      | 100  | 
|Sanofi-Synthélabo BMS ADI Ortakligi
partnership(1) |  | Turkey         |  |                      | 50.1 | 
|Sanofi-Aventis Ukraine LLC                         |  | Ukraine        |  |                      | 100  | 



|(1) | Partnership with Bristol-Myers Squibb (see Note C.1.).
|--- | ------------------------------------------------------



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



|                                     |  |               |  |                      |     | 
|------------------------------------ |  | ------------- |  | -------------------- | --- | 
|United States                        |  |               |  | Financial interest
% |    
|Armour Pharmaceutical Co.            |  | United States |  |                      | 100 | 
|Aventis Inc.                         |  | United States |  |                      | 100 | 
|Aventisub Inc.                       |  | United States |  |                      | 100 | 
|Aventis Holdings Inc.                |  | United States |  |                      | 100 | 
|Aventis Pharmaceuticals Inc.         |  | United States |  |                      | 100 | 
|BiPar Sciences Inc                   |  | United States |  |                      | 100 | 
|Carderm Capital L.P.                 |  | United States |  |                      | 100 | 
|Chattem, Inc.                        |  | United States |  |                      | 100 | 
|Chattem (Canada) Holdings, Inc.      |  | United States |  |                      | 100 | 
|HBA Indemnity Insurance, Ltd         |  | United States |  |                      | 100 | 
|Sanofi-Aventis US Inc.               |  | United States |  |                      | 100 | 
|Sanofi-Aventis US LLC.               |  | United States |  |                      | 100 | 
|Sanofi Pasteur Biologics Co.         |  | United States |  |                      | 100 | 
|Sanofi Pasteur Inc.                  |  | United States |  |                      | 100 | 
|Sanofi-Synthélabo Inc.               |  | United States |  |                      | 100 | 
|Signal Investment & Management Co.   |  | United States |  |                      | 100 | 
|SunDex, LLC                          |  | United States |  |                      | 100 | 
|TargeGen, Inc.                       |  | United States |  |                      | 100 | 
|Sanofi Pasteur VaxDesign Corporation |  | United States |  |                      | 100 | 
|Vaxserve Inc.                        |  | United States |  |                      | 100 | 



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



|                                                            |  |                      |  |                     |      | 
|----------------------------------------------------------- |  | -------------------- |  | ------------------- | ---- | 
|Other countries                                             |  |                      |  | Financial interest% |     
|Sanofi-Aventis South Africa (Pty) Ltd                       |  | South Africa         |  |                     | 100  | 
|Winthrop Pharmaceuticals (Pty) Ltd                          |  | South Africa         |  |                     | 100  | 
|Winthrop Pharma Saïdal S.P.A.                               |  | Algeria              |  |                     | 70   | 
|Sanofi-Aventis Algérie                                      |  | Algeria              |  |                     | 100  | 
|Sanofi-Aventis Argentina S.A.                               |  | Argentina            |  |                     | 100  | 
|Quimica Medical S.A.                                        |  | Argentina            |  |                     | 100  | 
|Sanofi-Aventis Australia Pty Limited                        |  | Australia            |  |                     | 100  | 
|Sanofi-Aventis Healthcare Holdings Pty Ltd                  |  | Australia            |  |                     | 100  | 
|Sanofi-Aventis Healthcare Pty Ltd                           |  | Australia            |  |                     | 100  | 
|Bullivants Natural Health Products (International) Pty Ltd |  | Australia            |  |                     | 100  | 
|Bullivants Natural Health Products Pty Ltd                 |  | Australia            |  |                     | 100  | 
|Cenovis Pty Ltd                                             |  | Australia            |  |                     | 100  | 
|MCP Direct Pty Ltd                                          |  | Australia            |  |                     | 100  | 
|Carlson Health Pty Ltd                                      |  | Australia            |  |                     | 100  | 
|Sanofi-Aventis Comercial e Logistica Ltda                   |  | Brazil               |  |                     | 100  | 
|Sanofi-Aventis Farmaceutica Ltda                            |  | Brazil               |  |                     | 100  | 
|Medley Comercial e Logistica Ltda                           |  | Brazil               |  |                     | 100  | 
|Medley S.A. Industria Farmaceutica                          |  | Brazil               |  |                     | 100  | 
|Sanofi Pasteur Limited                                      |  | Canada               |  |                     | 100  | 
|Sanofi Pharma General Partnership                           |  | Canada               |  |                     | 100  | 
|Sanofi-Aventis Canada Inc.                                  |  | Canada               |  |                     | 100  | 
|Chattem (Canada) Corp.                                      |  | Canada               |  |                     | 100  | 
|Chattem Canada ULC                                          |  | Canada               |  |                     | 100  | 
|Chattem Canada                                              |  | Canada               |  |                     | 100  | 
|Sanofi-Aventis de Chile SA                                  |  | Chile                |  |                     | 100  | 
|Sanofi-Aventis Pharma Beijing Co. Ltd                       |  | China                |  |                     | 100  | 
|Sanofi-Aventis (Hangzhou) Pharmaceuticals Co. Ltd           |  | China                |  |                     | 100  | 
|Shenzhen Sanofi Pasteur Biological Products Co. Ltd         |  | China                |  |                     | 100  | 
|Hangzhou Sanofi Minsheng Consumer Healthcare Co. Ltd        |  | China                |  |                     | 60   | 
|Winthrop Pharmaceuticals de Colombia SA                     |  | Colombia             |  |                     | 100  | 
|Sanofi-Aventis de Colombia SA                               |  | Colombia             |  |                     | 100  | 
|Sanofi-Aventis Korea Co. Ltd                                |  | Korea                |  |                     | 91   | 
|Sanofi-Aventis Gulf F.Z.E.                                  |  | United Arab Emirates |  |                     | 100  | 
|Sanofi-Aventis Egypt SAE                                    |  | Egypt                |  |                     | 100  | 
|Sanofi-Aventis del Ecuador S.A.                             |  | Ecuador              |  |                     | 100  | 
|Sanofi-Aventis de Guatemala S.A.                            |  | Guatemala            |  |                     | 100  | 
|Sanofi-Aventis Hong Kong Limited                            |  | Hong Kong            |  |                     | 100  | 
|Sanofi-Synthélabo (India) Ltd                               |  | India                |  |                     | 100  | 
|Aventis Pharma Ltd                                          |  | India                |  |                     | 60.4 | 
|Shantha Biotechnics Ltd                                     |  | India                |  |                     | 96.4 | 
|PT Sanofi-Aventis Indonesia                                 |  | Indonesia            |  |                     | 100  | 



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



|                                                         |  |                |  |                     |      | 
|-------------------------------------------------------- |  | -------------- |  | ------------------- | ---- | 
|Other countries                                          |  |                |  | Financial interest% |     
|PT Aventis Pharma                                        |  | Indonesia      |  |                     | 75   | 
|Sanofi-Aventis K.K.                                      |  | Japan          |  |                     | 100  | 
|Sanofi-Aventis Meiji Pharmaceuticals Co Ltd              |  | Japan          |  |                     | 51   | 
|Winthrop Pharmaceutical Japan Co Ltd                     |  | Japan          |  |                     | 100  | 
|Sanofi-Aventis Yamanouchi Pharmaceutical Inc.            |  | Japan          |  |                     | 51   | 
|Sanofi Pasteur K.K.                                      |  | Japan          |  |                     | 100  | 
|Winthrop Pharmaceuticals (Malaysia) SDN.BHD              |  | Malaysia       |  |                     | 100  | 
|Sanofi-Aventis (Malaysia) SDN.BHD                        |  | Malaysia       |  |                     | 100  | 
|Maphar                                                   |  | Morocco        |  |                     | 80.6 | 
|Sanofi-Aventis (Maroc)                                   |  | Morocco        |  |                     | 100  | 
|Sanofi-Aventis de Mexico SA de CV                        |  | Mexico         |  |                     | 100  | 
|Sanofi-Aventis Winthrop SA de CV                         |  | Mexico         |  |                     | 100  | 
|Winthrop Pharmaceuticals de Mexico SA de CV              |  | Mexico         |  |                     | 100  | 
|Laboratorios Kendrick S.A.                               |  | Mexico         |  |                     | 100  | 
|Sanofi-Aventis Pakistan Ltd                              |  | Pakistan       |  |                     | 53   | 
|Sanofi-Aventis de Panama S.A.                            |  | Panama         |  |                     | 100  | 
|Sanofi-Aventis Latin America SA                          |  | Panama         |  |                     | 100  | 
|Sanofi-Aventis del Peru S.A.                             |  | Peru           |  |                     | 100  | 
|Chattem Peru S.R.L.                                      |  | Peru           |  |                     | 100  | 
|Sanofi-Aventis Philippines Inc.                          |  | Philippines    |  |                     | 100  | 
|Sanofi-Aventis de la Rep. Dominicana S.A.                |  | Dominican Rep. |  |                     | 100  | 
|Aventis Pharma (Manufacturing) Pte. Ltd                  |  | Singapore      |  |                     | 100  | 
|Sanofi-Aventis Singapore Pte. Ltd                        |  | Singapore      |  |                     | 100  | 
|Sanofi-Aventis Taiwan Co. Ltd                            |  | Taiwan         |  |                     | 100  | 
|Sanofi-Synthélabo (Thailand) Ltd                         |  | Thailand       |  |                     | 100  | 
|Sanofi-Aventis (Thailand) Ltd                            |  | Thailand       |  |                     | 100  | 
|Sanofi-Aventis Pharma Tunisie                            |  | Tunisia        |  |                     | 100  | 
|Winthrop Pharma Tunisie                                  |  | Tunisia        |  |                     | 100  | 
|Sanofi-Aventis de Venezuela SA                           |  | Venezuela      |  |                     | 100  | 
|Sanofi-Synthélabo Vietnam Pharmaceutical Shareholding Co |  | Vietnam        |  |                     | 70   | 
|Sanofi-Aventis Vietnam Co. Ltd                           |  | Vietnam        |  |                     | 100  | 



The Group has also consolidated Merial and its subsidiaries since September 18, 2009, the date on which control was acquired (see Note
D.8.1.).



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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Continued)

Year ended December 31, 2010



F.2. Principal associates and joint ventures



|                                                                      |  |               |  |                     |      | 
|--------------------------------------------------------------------- |  | ------------- |  | ------------------- | ---- | 
|                                                                      |  |               |  | Financial interest% |     
|InfraServ GmbH & Co Höchst KG                                         |  | Germany       |  |                     | 31.2 | 
|Bristol-Myers Squibb / Sanofi Canada Partnership                      |  | Canada        |  |                     | 49.9 | 
|Bristol-Myers Squibb / Sanofi Pharmaceuticals Holding Partnership     |  | United States |  |                     | 49.9 | 
|Bristol-Myers Squibb / Sanofi Pharmaceuticals Partnership             |  | United States |  |                     | 49.9 | 
|Bristol-Myers Squibb / Sanofi Pharmaceuticals Partnership Puerto Rico |  | United States |  |                     | 49.9 | 
|Bristol-Myers Squibb / Sanofi-Synthélabo Partnership                  |  | United States |  |                     | 49.9 | 
|Bristol-Myers Squibb / Sanofi-Synthélabo Puerto Rico Partnership      |  | United States |  |                     | 49.9 | 
|Sanofi Pasteur MSD S.N.C.                                             |  | France        |  |                     | 50   | 
|Société Financière des Laboratoires de Cosmétologie Yves Rocher       |  | France        |  |                     | 39.1 | 



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