Amid Acquisition Rumors, Sanofi (SNY) Shifts Jobs in Massachusetts
2/26/2016 3:01:24 PM
February 29, 2016
By Mark Terry, BioSpace.com Breaking News Staff
Paris-based Sanofi (SNY)’s restructuring continues, this time with Sanofi Genzyme (SNY) shifting employees out of its facility in Framingham, Mass. to a new 53,879-square-foot space. This particular move was announced at the end of January.
When Olivier Brandicourt took over the reins of the company, he announced plans to focus on shoring up sagging diabetes sales, expand into new markets, and consider the spinoff of Merial, its animal health unit, and its European generics business. He also indicated that over the next five years he planned to cut $1.63 billion in costs.
At the J.P. Morgan Healthcare Conference held in San Francisco in January, Brandicourt said his strategy had four strategic priorities: reshape the company portfolio, deliver outstanding launches, sustain innovation in research and development, and simplify the organization.
“Simplify” often is a euphemism for job cuts, and that seems to be the case for Sanofi. The company employs about 110,000 people worldwide, with about 17,000 in the U.S.
To date, considering the number of people Sanofi employs, the job cuts have been relatively small. On Feb. 1, company executives met with French union representatives to discuss restructuring and layoffs. About 296 research and development jobs that were expected to be filled in France were being eliminated. Another 100 corporate jobs in France would be cut, and another 155 jobs in the company’s commercial areas were being slashed.
In the U.S., most of the cuts so far have been Massachusetts laboratory jobs in Cambridge, Framingham, and Waltham. For the most part, they were jobs in areas that supported Genzyme Corp. in biosurgery, bone and joint disease, drug delivery discovery and biomaterial engineering.
In Framingham, Sanofi Genzyme intends to use the new facility at 1 Research Drive for administration purposes, “implementing a dynamic workspace to promote collaboration,” Anna Robinson, an external communications specialist at Sanofi’s New Jersey Office, told telegram.com.
According to Bloomberg, Sanofi ranks nine out of ten on sales per employee in the 10 biggest pharma companies. Chicago-based AbbVie (ABBV) is number one, with nearly $800 million in sales per 1,000 employees. Pfizer (PFE) is number two, with approximately $640 million per 1,000 employees. Sanofi, in comparison, reports about $400 million per 1,000 employees.
Sanofi has indicated recently that it is considering an acquisition in the area of rare diseases. David Meeker, head of Sanofi’s Genzyme specialty care business, indicated acquisitions could be “up to the size of Genzyme,” which Sanofi acquired in 2011 for $20 billion.
Meeker stayed mum on who those targets might actually be, although he did suggest that there were a lot of bargains out there recently. “Valuations have come down but from high levels,” he told The Financial Times. “There is a certain resetting of valuations.”
The company recently appointed Alban de La Sabliere to head the company’s mergers and acquisitions. La Sabliere formerly worked as a banker for Morgan Stanley.
Analysts speculate that potential targets for Sanofi might include BioMarin Pharmaceuticals (BMRN), which has a market cap of about $13 billion, and Ionis Pharmaceuticals (IONS), with a market cap of $4 billion, and Ultragenyx (RARE), with a market cap of $2.5 billion.
BioMarin, based in San Rafel, Calif., has been struggling since the U.S. Food and Drug Administration (FDA) rejected its application for Kyndrisa (drisapersen) for Duchenne muscular dystrophy (DMD) earlier this year.
Ionis Pharmaceuticals, formerly known as Isis Pharmaceuticals, is headquartered in Carlsbad, Calif. The company recently partnered with Biogen (BIIB) on nusinersen to treat spinal muscular atrophy. It has entered in two Phase III trials, ENDEAR for infants and CHERISH for children. Some Phase II trial data is expected this year, and the Phase III readout is expected in 2017.
Ultragenyx, located in Novato, Calif., focuses on rare and ulra-rare diseases. The company has an active pipeline, with several trials ongoing for KRN23 anti-FGF23 Monoclonal Antibody in X-Linked Hypophosphatemia (XLH) and Tumor-Induced Osteomalacia (TIO), rhGUS in Mucopolysaccharidosis 7 (MPS7), and UX007 in Long-Chain Fatty Acid Oxidation Disorders (LC-FAOD) and Glut1 Deficiency Syndrome (Glut1 DS).
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