France’s Sanofi to Launch Drug Contender Against China and India

France’s Sanofi to Launch Drug Contender Against China and India

French drug giant Sanofi announced yesterday that it planned to launch a new company to create the active chemical ingredients for drugs, creating a European contender in a market currently dominated by firms based in India and China. 

According to the company’s press release, the “new industry champion” is set to rank second in the world, with some €1 billion in sales by 2022. Sanofi plans to hire more than 3,000 skilled employees for the new plant, set to be headquartered in France. 

Active pharmaceutical ingredients (API) are the essential molecules needed to produce the beneficial effects in any drug. Increasing medical shortages currently threaten medical systems throughout Europe, with the European Association of Hospital Pharmacists (EAHP) last year urging the European Commission to launch an investigation into shortages.

In the meantime, Sanofi’s announcement is well-timed: several EU member states have raised concerns with the Commission that coronavirus could impact the production of pharmaceuticals in China, with knock-on medical shortages throughout Europe. 

The Wuhan coronavirus, COVID-19, has shown to be highly-transmissible between humans; at present, there is no specific treatment or vaccine against it. Reported cases rose to more than 79,000 over the weekend, while Europe is now responding to its first major outbreak in Italy.

As of 24 February 2020, the number of cases are as follows: 132 in Italy (up from 3 on 14 February), 16 in Germany (unchanged), 13 in the UK (up from 9), 12 in France (up from 11), 2 in Spain (unchanged), 2 in Russia (unchanged), and 1 each in Belgium, Finland, and Sweden (all unchanged).

“We will remain vigilant and if the situation changes we will step up our work,” the health commissioner Stella Kyriakides told EU health ministers at an emergency meeting in Brussels last week, “for the moment, there are no shortages identified in the EU, but the commission is ready to proceed with a joint procurement of protective and medical equipment and to mobilise EU funding instruments.”

Meanwhile, the US Food and Drug Administration (FDA) has reportedly compiled a list of about 150 prescription drugs at risk of shortages if the ongoing coronavirus outbreak in China worsens. The list includes antibiotics, generics and branded drugs without alternatives; vaccines, gene therapies and blood derivatives licensed by the FDA are currently not manufactured in China.

To address these vulnerabilities, the FDA says it has been in contact with hundreds of drug and medical device manufacturers, as well as with global regulators like the European Medicines Agency. At the same time, however, FDA commissioner Stephen Hahn is not a member of the task force assembled by the Trump administration to handle the US’ response to the outbreak.

For its part, a spokesperson for Sanofi has said that plans for a new company are not connected with the ongoing coronavirus outbreak. Instead, the express purpose of the new entity, according to Sanofi executive vice president for global industrial affairs Philippe Luscan, is to “ensure greater stability in supplying drugs to millions of patients in Europe and beyond.” 

In January 2019, the export of APIs from China had reached US$29.1 billion, a growth of 13.7% from 2018. 

Joanna Eva is a London-based analyst and contributor with a range of clients in the risk consulting industry. She specializes in Asian political and economic analysis, having lived and travelled extensively in the region for close to a decade. She holds a Master of Law from the University of New South Wales and received her Bachelor of International Studies from the University of Sydney. She is proficient in English and Mandarin Chinese.

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