Sanofi-Aventis Alnwick site sale may fund US bid
Jul 27 2010 by Peter McCusker, The Journal
FRENCH drugs giant Sanofi-Aventis looks set to use some of the proceeds from the sale of its Northumberland plant to support a bid for an American drugs firm.
Paris-based drug maker Sanofi-Aventis has made an informal approach to buy Genzyme Corp as it looks to move into the biotech arena, it has been reported.
Earlier this month The Journal reported how 150 jobs at a Sanofi’s pharmaceutical site in Alnwick looked to have been secured after a buyer was found for the site.
Sanofi-Aventis had announced it is in exclusive talks with American firm Covance Inc over the sale of its plant at Alnwick, with the two companies signing a non-binding memorandum.
The Sanofi-Genzyme deal would allow Sanofi to have greater exposure in the biotech field and reflects on the recent trend of big drug makers buying out smaller biotech firms.
This allows them to boost their pipeline that is being threatened by patent expirations and arrival of more cheaper generic drugs.
On Friday, Sanofi-Aventis said profit may fall this year after US regulators approved a generic rival to its Lovenox blood thinner that had been generating sales of over £3bn a year.
There has also been speculation that UK drugs giant GlaxoSmithKline, which has facilities in Barnard Castle and Cumbria, may be in line to bid for Genzyme.
UBS analyst Gbola Amusa said: “Glaxo is less likely to enter a competitive process.
“In Glaxo’s case they are post the generics cliff, they are just emerging from that, so Glaxo doesn’t quite fit the profile to do a large deal for the sake of earnings growth.
“The question is: who wants Genzyme the most? Our view is that Sanofi is likely to emerge, simply because they are relatively deficient in biotech capabilities versus their peers, and need to better globally diversify their R&D engine.”
Both Glaxo and Sanofi declined to comment.
It is expected that the due diligence on the sale of Alnwick plant will be completed and contracts signed in time for the deal to be completed by the end of the year.
The announcement came a year to the day after France-based Sanofi announced it was seeking to sell the Alnwick site as part of an overhaul of its research and development activities.
