Sanofi Aims to Be Pharma’s Top R&D Organization, Zerhouni Says

Sanofi, France’s biggest drugmaker, is advancing its overhaul of research and development, with the goal of becoming the industry leader in bringing new medicines to market, said Elias Zerhouni, the president of global R&D.

Sanofi wants to become the best R&D organization among drugmakers by 2015, Zerhouni told reporters gathered at its new headquarters in Paris today. Scientists at the company should write top-quality scientific articles, and reach a higher rate of success in drug development than other companies, in less time and with fewer costs, he said.

Pharmaceutical makers worldwide are suffering from a dearth of new medicines at a time when they also are losing patent protection on their best-selling treatments. Sanofi (SAN) is forming more partnerships with academia and outside companies and increasing its capacity to translate scientific discoveries into new drugs, Zerhouni said.

Increased R&D productivity “isn’t a question of too big or too small; it’s a question of intelligence,” Zerhouni said. “The textbook on how to fix R&D hasn’t been written yet.”

GlaxoSmithKline Plc (GSK), the U.K.’s largest drugmaker, four years ago reorganized its research operations into small teams competing with each other for financing in one of the industry’s boldest experiments.

Sanofi Chief Executive Officer Chris Viehbacher, a former Glaxo executive, began downsizing the French company’s R&D operations, and dropping Sanofi’s least-promising research projects, after taking the helm of the company in December 2008.

Research Hubs

The company last year reorganized its R&D into four so- called “research hubs” in France, Germany, Asia and the Boston area to facilitate communication among teams and create an environment more open to external collaborations.

Sanofi also has been eliminating hierarchy levels and organizing scientists around specific projects, Zerhouni said.

“The project is what matters, not people’s titles,” Zerhouni said. “The least hierarchical the model is, the better.”

Researchers must be “integrated in the eco-system” and shouldn’t remained holed up in their labs, Zerhouni said. Sanofi’s old headquarters were situated close to a hospital called La Pitie Salpetriere and “did we ever speak to people at La Pitie Salpetriere? The answer is no,” Zerhouni said.

The company’s scientists are being encouraged to collaborate with academia if this can accelerate an experimental drug program, he said. They also now work closely with partner companies, such as France’s Genfit (ALGFT) and Vivalis SA (VLS), Zerhouni said.

Genzyme Deal

Partnerships and acquisitions have been the other part of Viehbacher’s strategy to help fill in Sanofi’s drug pipeline. Last year’s $20.1 billion purchase of U.S. biotechnology company Genzyme Corp. gave Sanofi access to the world’s biggest maker of medicines for rare genetic disorders.

Sanofi’s own scientists remain a pillar for the company’s growth, Zerhouni said today.

“Our internal researchers have capacities, qualities that have no equivalent in the world,” for their knowledge in areas such as chemistry and monoclonal antibodies, Zerhouni said.

The company won’t reduce its R&D investments in France, though it will be “investing differently,” he said. “We don’t want to just cut, cut, cut.”

Sanofi’s approach is encountering some success. Five new compounds, including the multiple sclerosis treatment Aubagio, were submitted to regulatory authorities over the past nine months. In total, 18 new drugs could potentially be introduced in the market between 2012 and 2015, Zerhouni said.

The company plans to focus on a so-called “phase 0” of drug development, before experimental medicines are tested on human beings, to make sure only the compounds most likely to succeed start clinical trials, Zerhouni said.

“Quality over quantity always wins,” he said.

To contact the reporter on this story: Albertina Torsoli in Paris at atorsoli@bloomberg.net

To contact the editor responsible for this story: Kristen Hallam at khallam@bloomberg.net

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