Many of Sanofi Diabetes Layoffs Likely to be in Massachusetts

Published: Dec 13, 2016

Many of Sanofi Diabetes Layoffs Likely to be in Massachusetts December 13, 2016
By Mark Terry, Breaking News Staff

Now that Paris-based Sanofi announced on Friday that it was cutting about 20 percent of its U.S. staff from its diabetes and cardiovascular unit, details are only now drifting in on where those cuts might be and exactly how many. Although the actual number, likely to be in the hundreds, is still not clear, Boston is likely to be one of the sites to lose a high percentage of those jobs.

Sanofi’s Diabetes and Cardiovascular unit sales dropped 2.5 percent globally during the third quarter of 2016, and its diabetes franchise dropped 1.5 percent. Insurers are putting increased pricing pressure on diabetes-related products.

Sanofi’s top diabetes drug, Lantus, lost patent protection in the U.S. and some of its pipeline has fizzled, including its failed partnership with MannKind Corporation for Afrezza, an inhaled formulation of insulin. And it’s next-generation cholesterol drug, Praluent, hasn’t gained much traction in the market.

Eli Lilly and Co. is launching a biosimilar to Lantus, Basaglar, next week, which will likely continue to eat into Lantus sales. Sanofi launched its own follow-up to Lantus, Toujeo, but so far it hasn’t caught on in the marketplace.

In addition, Merck & Co. ’s biologic version of Lantus, MK-1293, is being reviewed by the U.S. Food and Drug Administration (FDA) and is expected to launch sometime next year. The drug is being partially funded by biosimilar company Samsung Bioepis.

In the first nine months of 2016, Lantus sales dropped 10.7 percent from the same period in 2015. The third-quarter Lantus sales were 9.8 percent lower than the same period the year before. In the U.S., the drop was 13.5 percent, although Sanofi expected it, saying it was “mainly reflecting lower average net price and patients switching to Toujeo.”

Some of the job losses will be in business support at Sanofi’s U.S. headquarters located in Bridgewater, New Jersey. But Sanofi has more than 5,000 staffers in Massachusetts, which includes Sanofi Genzyme , its specialty care business located in Cambridge.

The Boston Business Journal reports that an unidentified number of staff in the unit have been offered separation packages. Those packages, according to Sanofi spokeswoman Ashleigh Koss, include severance pay, health benefits and outplacement services.

“At this time,” Koss told the Boston Business Journal, “it’s challenging to provide any further granularity on this announcement given that employees in good standing can apply for other positions based on their qualifications.”

In late 2015, Sanofi made a collaboration with Hanmi for about $4.1 billion to create long-acting diabetes treatments. It also inked a partnership deal with Lexicon Pharmaceuticals for up to $1.7 billion to develop and market sotagliflozin (LX4211), a Phase III drug candidate. And in September of this year, Sanofi, along with Verily, formerly known as Google Life Sciences, started a joint venture called Onduo to develop a diabetes management platform.

The end of the year has marked many layoffs in biopharma. Novo Nordisk , also a major competitor in the diabetes market, recently announced plans to lay off 1,000 people. Mylan recent announced it was cutting less than 10 percent of its U.S. staff. Eli Lilly, after the failure of its Alzheimer’s drug, solanezumab, indicated it plans to lay off hundreds, mostly in its U.S. sales force. Endo Pharmaceuticals , in Dublin, Ireland and Malvern, Pennsylvania, announced it is laying off 375 staffers as a shift away from its pain drug franchise. And London, UK-based AstraZeneca plans to cut 700 U.S. jobs.

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