Sanofi plans to double its vaccine output by 2023 by building a €350 million ($431.5 million) vaccine manufacturing plant in Toronto. The project underscores the company’s reliance on vaccines as an engine for future growth despite more than $300 million in fourth-quarter charges tied to setbacks with two vaccines.
The new 150,000-square-foot Bulk Biologics Facility will rise within the Connaught Campus, which serves as the Canadian headquarters of the pharma giant’s Sanofi Pasteur global business unit. Upon its completion in 2021, the new facility will produce five-component acellular pertussis (5-acP) antigen—enabling the pharma giant’s Sanofi Pasteur global business unit to meet what it says is growing demand for the product—as well as the antigens used in the diphtheria and tetanus vaccines, Sanofi said.
The facility will also produce a new pertussis (whooping cough) vaccine for launch into more than 30 markets worldwide.
Nearly 1250 jobs will be created or maintained as a result of the vaccine manufacturing facility. Sanofi entities in Canada employ close to 1900 people, with almost 80% of employment related to vaccine business, according to the Federal Economic Development Agency for Southern Ontario (FedDev Ontario).
Worldwide, Sanofi employs more than 100,000 people in 100 countries.
“Canada has a strong legacy in the research and development of vaccines. With this investment, Sanofi is renewing our longstanding commitment to making Canada central in our effort to protect and improve human health across the globe,” said David Loew, EVP and head of Sanofi Pasteur. “Vaccines save three million lives every year, and this new facility will take us one step closer to a world where no one suffers or dies from a vaccine-preventable disease.”
“Watching with Great Concern”
Speaking to the Financial Post newspaper, Loew voiced the company’s criticism of proposed price changes by Canada’s Patented Medicine Prices Review Board (PMPRB), which can set maximum prices on newly patented drugs entering the market.
“What we’re currently watching with great concern is the ecosystem in Canada, especially on the healthcare reimbursements (side), for pharmaceuticals and vaccines at least (as they are) being discussed now through the PMPRB,” Loew was quoted as saying.
The PMPRB in February proposed the first major change to Canada’s Patented Medicines Regulations since its adoption in the 1990s.
The proposed changes—aimed at curbing rising drug prices—include linking those prices to the ability of drugs to show “demonstrably better health outcomes,” updating the list of countries used for price comparison, and requiring drugmakers to provide the Board with third-party information related to rebates and discounts on domestic prices, according to a summary released by Canada’s government.
PMPRB should consider the overall impact of vaccines, including efficacy, rather than simply affordability, Loew told the Financial Post: “It is the most efficient intervention in medical care that you can do after clean water. Vaccines help lower morbidity and mortality, which should be considered when setting the price.”
Dengvaxia, C.difficile Setbacks
Sanofi’s 2018 priorities include growing Sanofi Pasteur sales, which while growing 8.3% for all of 2017, to €5.101 billion ($6.289 billion), only inched up 1.2% during Q4, to €1.385 billion ($1.708 billion).
In releasing fourth-quarter results on February 7, Sanofi said its fourth-quarter operating income was reduced by €158 million ($194.8 million) due to problems with its pioneering dengue vaccine Dengvaxia®. Sanofi recorded total 2017 net sales for Dengvaxia of just €3 million ($3.7 million), and negative net sales of €19 million ($23.4 million) during the fourth quarter.
Sanofi said in November it would take a Dengvaxia-related fourth-quarter charge to reflect reduced sales after long-term clinical trial data showed the vaccine could increase the severity of the disease in people who were not previously infected. Sanofi said at the time it would ask regulatory agencies to update the prescribing information for Dengvaxia by adding a request that healthcare professionals evaluate the likelihood of prior dengue infection in patients before vaccination.
The Dengvaxia woes were among reasons behind the company’s €262 million ($323 million) impairment of intangible assets charge during Q4. Another factor was Sanofi’s decision, announced December 1, to halt development of its Clostridium difficile candidate after the Independent Data Monitoring Committee for the Phase III Cdiffense™ clinical trial (NCT01887912) concluded that the vaccine was unlikely to meet the study’s primary endpoint of efficacy in adults ages 50 years-plus who are at risk for C. difficile infection and received at least one injection of the vaccine.
Sanofi announced plans for the new plant yesterday at an event attended by company executives as well as dignitaries from the Ontario and Canadian governments.
The government of Ontario agreed to provide a C$50 million ($39.8 million) grant, while the government of Canada plans to award C$20 million ($15.9 million) in funding toward the project through FedDev Ontario, one of six regional development agencies across Canada.
“This project is one of the most important investments for the Sanofi global industrial network,” stated Philippe Luscan, EVP, Global Industrial Affairs, Sanofi. “It demonstrates our continued commitment to manufacturing excellence and to better serving our vaccines portfolio to people all over the world.”