French Drugmaker Sanofi Eyes U.S. Biotechs

French big pharma company Sanofi, the fifth-largest pharmaceutical company in the world, is seeking to expand, with an eye on Principia Biopharma. The San Francisco-based company already works with Sanofi on the development of treatments for central nervous system (CNS) diseases, like multiple sclerosis, and a slew of autoimmune diseases.

After selling off its stake in Regeneron Pharmaceuticals Inc., Sanofi has up to $50 billion available for acquisitions and investments. Once Principia was rumored to be Sanofi’s primary target, shares in the company shot up 13% on July 16. However, there has still been no official statement about a potential acquisition, or an expansion of the partnership between the two.

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The main product currently coming down the Principia pipeline is rilzabrutinib, a therapy for treating immune-system diseases. The BTK inhibitor, a type of medicine most typically used to treat cancers, is being used by Principia to treat pemphigus, a family of diseases that causes painful blisters. Immunotherapies for cancers, autoimmune diseases, or other maladies have been the primary recipients of Sanofi’s interest in recent years.

Other companies, like Bristol Myers Squibb, Roche, and Gilead, have attempted to utilize BTK inhibitors to treat autoimmune diseases, but so far all have failed. However, Principia recently surprised many doubters when their unlikely MS drug passed its phase 2 clinical trial.

Immunotherapy drugs can come at a high cost to patients, which could be part of the reason Sanofi is so keen to snap them up. They present the potential for high profits, which is especially appealing for a company that recently shifted its leadership. Sanofi brought in Paul Hudson as their new chief executive officer last fall, who immediately trimmed the leadership team from 14 down to 10. Hudson stated early on that he wanted the company to focus on high-growth areas, specifically immunology, cancers, and rare diseases. Acquiring Principia Biopharma would align well with his vision in terms of the types of therapies they produce. It would also help Sanofi embark on a much-needed rejuvenation, as 78% of last year’s sales were made from drugs that are over a decade old.