Sanofi Announces R&D Restructuring and Workforce Reduction of Nearly 500 Roles to Sharpen Focus on Core Therapeutic Areas

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Sanofi announced on June 20 that, as part of the restructuring of its R&D team, it will eliminate 466 positions in France and Germany. The aim is to focus on cancer, immunology, rare diseases, and vaccines, while discontinuing some R&D projects that no longer align with its strategic priorities. According to the statement, the layoffs will be voluntary.

In a statement, Sanofi announced that it would halt new research on cardiology indications and limit its investments in this field to existing assets and licensed clinical-stage drugs. Meanwhile, the company plans to refocus its diabetes research on therapies addressing the root causes of the disease while continuing to advance its current diabetes pipeline.

Sanofi is renowned for leveraging collaborations to drive innovation, with Regeneron being its most prominent partner; however, the company has gradually downplayed this relationship over the past two years. In spring 2018, Sanofi appointed John Reed, former Head of Research and Development at Roche, to succeed Elias Zerhouni, who was nearing retirement. In fact, as early as 2017, Sanofi had already been committed to shifting toward greater in-house R&D, aiming to develop more internally discovered compounds.

John Reed

Nevertheless, shortly after taking the helm, John Reed spearheaded the collaboration with Denali Therapeutics, which featured an upfront payment of $125 million and potential milestone payments exceeding $1 billion. Currently, both parties are working to develop DNL758 for inflammatory diseases such as rheumatoid arthritis and psoriasis, and DNL747 for conditions including multiple sclerosis, Alzheimer’s disease, and amyotrophic lateral sclerosis.

Sanofi is restructuring its R&D teams as a means to free up capital for competition in other therapeutic areas. In France, Sanofi plans to strengthen research in immuno-oncology and gene therapy; in the United States, it intends to increase investment in the development of gene therapies; and in Germany, it will ramp up spending on antibody engineering.

John Reed stated in an email: “The transformation of our R&D organization will enable us to focus on key therapeutic areas and technology platforms, where we believe there are greater opportunities to make meaningful differences for patients and maximize the productivity of our research engine.”

Sanofi, which previously relied on partners such as Regeneron and Alnylam, now has an R&D team ready to shoulder the responsibility of developing breakthrough products. As part of its efforts to focus more on internally developed projects, Sanofi recently announced a restructuring of its collaboration with Voyager Therapeutics, returning the gene therapy VY-HTT01 for Huntington’s disease and another gene therapy, VY-FXN01, for Friedreich’s ataxia, to Voyager.

In January last year, Sanofi successively announced two major acquisitions to bolster its R&D capabilities and pipeline assets: a $11.6 billion acquisition of the U.S. biotechnology company Bioverativ to enhance its competitiveness in hematology-related fields, and a $4.8 billion acquisition of the Belgian nanobody company Ablynx, securing assets spanning hematology, inflammation, tumor immunology, and respiratory diseases, along with a novel nanobody technology platform. Some analysts believe that uniQure, a Dutch gene therapy company, could become Sanofi’s next acquisition target, potentially accelerating the build-out of its gene therapy team.

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Sanofi to ax 466 jobs, step up focus on cancer, gene therapy R&D