FRANCE — French drugmaker Sanofi has agreed to acquire US-based pharmaceutical firm Provention Bio for approximately US$2.9 billion to strengthen its general medicines portfolio with the US-approved type 1 diabetes drug Tzield.
Provention Bio, a New Jersey-based biotech company, gained FDA approval in November 2020 for its drug, Tzield, which has been shown to delay the onset of type 1 diabetes by approximately two years.
Sanofi had previously struck a deal with Provention Bio in October 2020 to co-promote Tzield in the U.S., giving the French company first rights to negotiate any licensing rights for the drug.
Under the acquisition agreement, Sanofi will pay US$25 per share, which represents a 273% premium over Provention Bio’s closing price on Friday.
The news of the acquisition is expected to be well-received by the market, particularly after the recent failure of Silicon Valley Bank, which had caused concerns about the industry’s stability.
Tzield is the first treatment to show such a delay effect and is priced at US$193,000 for a course of treatment.
With the acquisition of Provention Bio, Sanofi is expected to expand its portfolio of diabetes treatments and improve its competitive position in the market.
Sanofi discontinued diabetes research in 2019 as part of a pipeline overhaul to focus on other areas, including cancer, rare disease, and inflammatory conditions.
The diabetes drug market has experienced price pressure from US politicians, and competitors Eli Lilly and Novo Nordisk have launched successful weight loss drugs.
However, Sanofi’s diabetes drugs still generate billions of dollars in sales, and the company has commercial infrastructure supporting them.
The acquisition of Provention Bio aligns with Sanofi’s mission to deliver best-in-class medicines and supports its purpose of pursuing scientific breakthroughs.
The two companies were already working together to sell Tzield, and the acquisition will further strengthen Sanofi’s position in the diabetes treatment market.
Tzield is currently FDA-approved for symptomatic adult patients with stage 3 type 1 diabetes and asymptomatic stage 2 adolescents with blood sugar issues.
Provention Bio is conducting a Phase III trial, PROTECT, to evaluate the drug’s effectiveness in newly diagnosed patients, with results expected in H2 2023.
If successful, this trial could expand the market for the drug. While there is no data available yet on Tzield’s sales in the market, Provention and Sanofi launched the drug earlier this year.
Meanwhile, in what could represent a significant transformation of the insulin marketplace, Eli Lilly plans to cut the prices of Humalog and Humulin insulin products by 70%, and expand its patient assistance program to cap out-of-pocket costs at US$35 per month for commercially insured and uninsured patients.
The move follows legislative efforts to impose similar cost caps and a history of double-digit percentage increases in list prices of insulin products.
Insulin product list prices experienced significant increases during the 2010s, sometimes reaching double digits annually.
The pharmaceutical industry has cited the rebate game with pharmacy benefit managers as a reason for these increases.
Further to that, Eli Lilly will launch a biosimilar basal insulin called Rezvoglar in April, which will challenge the originator biologic, long-acting Lantus.
The price of Rezvoglar, at US$92 for a five-pack of injection pens, will be 78% less than the list price for Lantus.
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