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A look back at Sanofi's merger with Synthélabo

This month, in 1999: How two pharma companies came together to create a giant

in 1999Some of the world's biggest pharma companies have enjoyed long, successful histories as leaders of their particular field.

The likes of Roche, Bayer and Pfizer all still retain the names of their founders decades after their death, while also still being major players in the pharma industry.

For other companies, however, the journey to the top has been rather more circumlocutory, with many twists, forks and crossroads, representing an arduous process of mergers and name changes over the course of many years.

It was this complex path that formed GlaxoSmithKline (which only 25 years ago was disparate entities SmithKline Beckman, Beecham Group, Glaxo and Wellcome) and Novartis (formerly Ciba-Giegy and Sandoz), not to mention the confusing tale of the two Mercks (one German-headquartered group until World War I when the US subsidiary Merck & Co was forced to split from its parent Merck KGaA in 1917).

Now simply known by one word of six letters, Sanofi is another company to have a multifaceted history, with its current entity a result of mergers or evolutions of more than 20 companies dating back to 1718.

Entering the limelight
Its arrival as a pharma major arguably only occurred in May 1999, when the first company known as Sanofi, which originally formed in 1973, merged with fellow France-based biopharma and former l'Oreal business Synthélabo, to create Sanofi- Synthélabo – then, the sixth largest pharma company in Europe.

At the time, Sanofi was a relatively young business having formed from the consolidation of a number of cosmetic, healthcare and animal nutrition firms that were part of the state-owned French oil company Elf Aquitaine.

From 1973 to 1999, it had grown gradually, picking up several other firms along the way, including Clin Midy – a French pharma group with roots back to 1718 – and US pharma company Sterling Winthrop, giving Sanofi its first foothold in North America.

Synthélabo was not much older, having being formed in 1970 from the merger healthcare firms Laboratoires Dausse and Laboratoires Robert & Carrière, both dating back to the early 20th century.

The merger with Synthélabo was a crucial move for Sanofi, which at the time was contemplating shedding its other business areas to focus on its burgeoning pharma products.

This included several recently launched major medicines, including hypertension treatmeant Aproval (irbesartan), anti-blood clot medicine Plavix (clopidogrel), Copaxone (glatiramer acetate) for multiple sclerosis, and several more in the pipeline.

US growth
In order to ensure the maximum benefit from these products, however, Sanofi needed to grow further, and add to its sales and marketing force, especially if it was to realise its potential in North America.

The Sterling Winthrop partnership in 1991 had helped this objective, as did the acquisition of US-based Bock Pharmacal Company in 1996, but Sanofi's small stature in comparison to much larger rivals and its strong portfolio of medicines made it a target for takeover.

The Synthélabo deal took the pressure off, however, bolstering Sanofi's sales and marketing activities and giving the company access to even more successful products, including Ambien (zolpidem) for insomnia.

By 2000 Sanofi was able to lose its other business interests and focus solely on its pharma activities, which continued to grow.

This growth continued, and it wasn't long before Sanofi- Synthélabo needed another merger to continue the trajectory and reach even more patients.

The target was Aventis – a Franco-German company formed in 1999 from the merger of Hoechst Marion Roussel and Rhône-Poulenc that was also being courted by Novartis.

Further expansion
In 2004, after an initial hostile takeover attempt failed, Sanofi eventually won out, and sanofi-aventis was born, joining Roche, Pfizer, J&J and Novartis as one of the world's largest healthcare companies.

This merger also meant the formation of Sanofi Pasteur, Sanofi's vaccines-focused business, which itself had a long history dating back to the Institut Pasteur – established by groundbreaking French scientist Louis Pasteur in the late 19th century.

Following this dramatic move, Sanofi continued its expansion, including high profile acquisitions, such as Czech Republic-based Zentiva in 2009 to give the company a foothold in Eastern Europe, and the 2011 purchase of biotech Genzyme for a massive $20.1bn.

Not long after the Genzyme acquisition was confirmed, in May 2011 – 12 years after the merger with Synthélabo – sanofi-aventis again changed its name to match its evolution, dropping an 'aventis' and gaining a capital S to return its old moniker Sanofi as a very different, larger company.

With the new name, a new logo was also created in the shape of the 'bird of hope', consisting of three parts that represent the principles of innovation, adaptability and external growth.

Suitable principles for any pharma company, but especially for one with such a dynamic, acquisitive history as Sanofi.

Article by
Tom Meek

web editor at PMLiVE

24th May 2013

From: Research, Sales

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