Sanofi to Eliminate 400 U.S. Jobs
The diabetes market, in the U.S. in particular, has been a tough one, with increased downward pressure on pricing. Sanofi is not the only company in the arena to face problems in the insulin market. Eli Lilly and Novo Nordisk have also been hit, with Novo Nordisk cutting 1,000 positions in 2016 and Lilly cutting around 3,500 in 2017.
Merck which also has a strong presence in the diabetes market, cut 1,800 sales employees in October 2017. In December 2016, Sanofi indicated it planned to cut 20 percent of its diabetes sales force in the U.S. In February 2016, it cut 500 positions in France, which because of the French labor unions, is extremely difficult to do.
Sanofi spokesperson Ashleigh Koss stated that the reorganization will “enable us to continue to adapt to the ever-changing market, and allow us to focus on our recent launches while setting us up for success in the future.”
Sanofi employs about 110,000 staff globally. About 17,000 of those workers are in the U.S.
When Olivier Brandicourt took over the company after Chris Viehbacher’s ouster in 2014, his new strategy focused on bolstering the company’s sagging diabetes franchise, pushing into other markets, evaluating the spinoff of its animal health unit, Merial, and its European generics business. He also planned to restructure the company to create efficiencies and cut costs. Part of that plan was to slash $1.63 billion in costs over the next five years.
The company has had a mixed bag of successes and failures. Its inhaled insulin therapeutic, Afrezza, which it partnered with MannKind Corporation, was a debacle, and in Jan. 5, 2016, ended its relationship. It developed a new type of cholesterol mediation, Praluent, with Regeneron, but has had problems gaining traction because of payer restrictions. On the other hand, its launches of Kevzara for rheumatoid arthritis and Dupixent for atopic dermatitis have been going well, according to the company’s presentations at the J.P. Morgan Healthcare Conference earlier this month.
Koss stated, “These changes will help us successfully execute our business strategy in 2018 and beyond, and to continue to make a difference with customers and patients.”
The company also had some notable losses in the mergers-and-acquisitions area, losing out to Pfizer on a bid for Medivation, and to Johnson & Johnson for the acquisition of Actelion. However, Sanofi announced today that it is acquiring Bioverativ for $11.6 billion. Bioverativ is a spinoff from Biogen. Biovertiv focuses on the hemophilia market, marketing Eloctate and Alprolix with Stockholm-based Sobi.
In a statement, Brandicourt said, “With Bioverativ, a leader in the growing hemophilia market, Sanofi enhances its presence in specialty care and leadership in rare diseases, in line with its 2020 Roadmap, and creates a platform for growth in other rare blood disorders.”
It’s a consistent acquisition, bolstering its presence in rare diseases with its Genzyme division, and a recently restructured deal with Alnylam to gain worldwide rights for its fitusiran for hemophilia.