Daiichi Sankyo and Sanofi Terminate Collaboration on Two Combination Vaccines Following Manufacturing Issues

Compiled by Fan Dongdong

Recently, after encountering manufacturing issues, Daiichi Sankyo and Sanofi announced the termination of their collaboration agreement for the Squarekids combination vaccine, and also decided to terminate the collaborative development agreement for another pentavalent combination vaccine, VN-0105.

Squarekids is a quadrivalent combination vaccine that prevents diphtheria, pertussis, tetanus, and poliomyelitis. It was approved in Japan in 2014 and launched for sale in the second half of the following year. Through the joint efforts of Daiichi-Sankyo and Sanofi, this combination vaccine integrates Sanofi’s inactivated polio vaccine with Daiichi-Sankyo’s DPT injection for subcutaneous administration.

In a statement released this Wednesday, Daiichi-Sankyo announced that it would cease the production and supply of Squarekids to the market due to prior issues in pertussis vaccine manufacturing. Although the company later stated that these issues had been resolved, it ultimately decided to terminate its vaccine collaboration with Sanofi and completely halt production of the vaccine. Daiichi-Sankyo further indicated that it would stop the distribution and supply of Squarekids products effective March 31.

Daiichi Sankyo did not disclose the detailed reasons for the production interruption. In response, Jefferies analysts commented that Daiichi Sankyo appeared to have postponed the production of Squarekids since the fiscal year ended in March 2020. A Sanofi spokesperson stated in an interview that Daiichi Sankyo initially “hoped to resume production and distribution by improving manufacturing processes,” but subsequently decided to withdraw from the collaboration. Sanofi also did not provide specific details regarding the manufacturing issues. “Sanofi will continue to explore future collaboration opportunities with Daiichi Sankyo and remains committed to manufacturing and distributing innovative vaccines for patients across a broad age range, from infants to the elderly.” Furthermore, the two companies decided to terminate their collaborative development of the VB-0105 combination vaccine, which prevents diphtheria, Haemophilus infections, pertussis, poliomyelitis, and tetanus. Nevertheless, Daiichi Sankyo indicated that it would continue to collaborate with Sanofi on the production and supply of other pharmaceutical products, including vaccines.

Terminating the partnership will result in Daiichi Sankyo compensating Sanofi JPY 150 billion (approximately USD 135.41 million), with this loss expected to be recorded in its financial report for the fourth quarter of fiscal year 2020, ended March 31. Jefferies analysts believe that, as Squarekids is not a major sales driver for Daiichi Sankyo, the impact of this loss on the company’s medium- to long-term performance will be minimal. According to Sanofi’s annual report, in 2020, its franchise covering poliomyelitis, pertussis, and invasive Haemophilus influenzae type b (Hib) generated total revenues of EUR 1.36 billion (approximately USD 1.6 billion) in regions outside Europe and the United States.

It is worth noting that this is not the first time the two companies have terminated their collaboration. In July 2020, after spending several years attempting to obtain Phase III trial data, Sanofi and Daiichi-Sankyo terminated a development agreement for a combination vaccine against diphtheria, tetanus, pertussis (DTP), polio, and Haemophilus influenzae type b (Hib). Sanofi initiated Phase III studies of the combination vaccine in 2014, and in 2017, the company stated that it expected to file for approval before 2020. However, the approval timeline was repeatedly delayed—first pushed back to 2021, then further postponed to “2023 and beyond”—and ultimately, Sanofi abandoned the collaborative effort.

Reference Source: Daiichi exits combo vaccine pact with Sanofi after pertussis shot manufacturing glitches