Sanofi said today it is reducing from seven to five its number of business units effective in January 2016.
Until now, Sanofi organized its business around units focused on diabetes, human vaccines, “innovative” drugs, consumer healthcare, emerging markets, animal health, and rare diseases (through its Genzyme subsidiary).
The pharma giant identified its five new units as focusing on General Medicines & Emerging Markets, Specialty Care, Diabetes & Cardiovascular, Sanofi Pasteur, and Merial:
- General Medicines & Emerging Markets will consist of Sanofi's established products, generics, consumer healthcare, and all pharmaceutical businesses in emerging markets. The unit will be led by Peter Guenter, now evp, global commercial operations.
- Specialty Care, to be called Sanofi Genzyme, will consist of Sanofi's medicines in rare diseases, multiple sclerosis, oncology, and immunology, including drug candidates sarilumab and dupilumab, both co-developed with Regeneron Pharmaceuticals. David Meeker, M.D., now evp and CEO of Sanofi’s current Genzyme unit, will lead the new Genzyme unit.
- Diabetes & Cardiovascular will consist of Sanofi's diabetes care medicines as well as cardiovascular, which includes Praluent® (alirocumab), another Regeneron-co-developed drug now under review by the FDA and the European Medicines Agency (EMA). The unit will be led by Pascale Witz, now evp, global divisions & strategic development.
- Sanofi Pasteur, the company’s vaccine unit, will remain intact and be led by Olivier Charmeil, evp, vaccines.
- Merial, Sanofi’s animal health products unit, also remains intact, with Carsten Hellmann continuing as evp.
Sanofi added that all corporate functions will be globalized to better serve the business units, as the company has already done with Research and Development and Industrial Affairs.
The composition of the Executive Committee remains unchanged, Sanofi said.
“The new organization simplifies and focuses Sanofi to optimize growth,” Sanofi CEO Olivier Brandicourt, M.D., said in a statement. “This is a necessary step for ensuring that Sanofi's new medicines and vaccines continue to build on our heritage of providing innovative healthcare therapies.”
Sanofi said the restructuring was needed given the company’s plans to launch up to six new medicines this year, and approximately one new medicine every six months between 2016 and 2018.
However, Sanofi and Dr. Brandicourt, who was named in February and took office in April, also face significant challenges it hopes can be better surmounted through the restructuring.
One example: In addition to competition, the company’s diabetes business, for instance, has seen the loss of patent protection in February for the active ingredient in Lantus. Dr. Brandicourt’s predecessor Christopher Viebacher—ousted by Sanofi’s board in October—has acknowledged that Sanofi had to lower the price of Lantus to payors in order to ensure that the once-daily basal insulin was included in insurers’ formularies in 2015.
Sanofi launched a new formulation of Lantus, called Toujeo, in the U.S. in April. Toujeo is among the new drugs Sanofi plans to launch, which are projected to generate a combined €30 billion (about $33.9 billion) in new sales by 2020.
The restructuring comes less than a month after Brandicourt told the company’s union leaders that he will unveil a five-year strategic plan for the company in November, following the release of third-quarter results, union sources told Reuters.
