(Dec 24): Sanofi agreed to buy Dynavax Technologies Corp for about US$2.2 billion, as the French drugmaker tries to expand a vaccines business currently anchored by its flu shot franchise.
Sanofi will pay US$15.50 a share in cash for Dynavax, 39% above the Emeryville, California-based closing price on Tuesday. The statement on Wednesday came minutes after Sanofi said the US Food and Drug Administration (FDA) had surprisingly rejected its experimental multiple sclerosis drug tolebrutinib.
Shares of Sanofi slipped as much as 1.5% in early trading in Paris. They were down about 12% this year through Tuesday’s close.
The Dynavax deal gives Sanofi a hepatitis B vaccine that’s already marketed in the US, as well as an experimental shingles inoculation currently in early human testing. This will enhance its presence in adult immunisation, according to the company, whose vaccine and immunisation portfolio spans influenza, respiratory syncytial virus, meningitis, pertussis and more.
Still, Sanofi has inked the deal despite difficulties in the global vaccination market. The company’s flu vaccine sales fell last quarter, with more price competition in Europe and lower vaccination rates in the US, where Health and Human Services Secretary Robert F Kennedy Jr is upending longstanding vaccine guidance — though many changes have focused on childhood shots.
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Chief financial officer Francois-Xavier Roger said at Sanofi’s latest results that vaccination rates were declining globally. “It probably is linked to some fatigue post-Covid around vaccinations. There might be a little bit of a negative feeling about vaccines overall as well,” he said.
The agreement for Dynavax isn’t expected to have any impact on Sanofi’s financial guidance for 2025, said the company, which expects to complete the acquisition in the first quarter of 2026.
Drug rejection
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Meanwhile the FDA’s rejection of tolebrutinib was a significant blow for a drug Bloomberg Intelligence had pegged at having the potential for US$1.7 billion in peak annual sales. Sanofi had already faced hurdles developing the medicine, with trials pointing to a risk of liver injury.
The regulator’s decision comes days after Sanofi said the review will likely be delayed, with further guidance from regulators expected in early 2026.
The company is “very disappointed by the FDA’s action,” Houman Ashrafian, head of research & development at Sanofi, said in a statement, calling the decision “a significant and meaningful change in direction from the feedback the agency previously provided to Sanofi”.
Multiple sclerosis (MS) is a complex condition that affects the brain and spinal cord, which results in symptoms such as muscle cramps, numbness and fatigue. There are several types of MS, the most common involving periods of sudden worsening followed by periods of recovery.
One type, called secondary progressive MS, which involves which involves a steady increase in disability, is what Sanofi’s FDA application targets.
There are currently few treatments for this type of MS. Sanofi said it is committed to working with the FDA to find a path forward for the drug.
“It now looks increasingly unlikely that tolebrutinib will reach the market in the US,” JPMorgan Chase & Co analyst Richard Vosser said in a note. Even so, the market has “already discounted the majority of value for the product”, given the previous setbacks, he wrote.
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