Genzyme wins key FDA approval for new plant

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You can bet that Sanofi's ($SNY) top brass are celebrating this evening. The French drugmaker's Genzyme unit won the long-sought FDA approval for its new plant in Framingham, MA. That facility can now turn out Fabrazyme, the Fabry disease drug that has been running short for two years, for U.S. customers.

Coming on top of last week's European approval, the FDA nod is another step toward getting Genzyme's supply of its rare-disease drugs back to full strength, CEO David Meeker said in a statement. "With this approval, we continue upon our 2012 plan to restore unconstrained supply for all patients globally throughout the course of the year," he said.

Genzyme's supplies have been tentative since 2009, when viral contamination brought a Boston-area plant to a standstill. As the company worked to clean up the facility and bring supplies of Fabrazyme and Gaucher's disease drug Cerezyme back online, it drew buyout interest from Sanofi, which promised that its manufacturing expertise could help. The French company acquired Genzyme last year in a deal that included extra payments to shareholders based on certain operational goals--including production targets for those two drugs.

Fixing the manufacturing issues turned out to be a bit more complicated than Sanofi perhaps expected; some drug batches had to be scrapped, for instance, because they didn't meet specifications. The company didn't hit those production targets, so the first milestone payment would go unpaid. The Framingham plant was held up as a totem of recovery: Once that plant came online, the supply problems would become a thing of the past.

Now, Genzyme has its plant approvals. So, we'll soon know whether it delivers as promised. Meeker has been careful to color his statements with patience; boosting supplies of these complicated drugs won't be an overnight thing, he says. Return to normal supplies of Fabrazyme will "continue throughout the year," the company said. But at least one analyst was a bit more decisive in his praise: "Today's announcement shows its recovery is on track," Bryan, Garnier & Co.'s Eric Le Berrigaud told Bloomberg. "Sanofi managed to keep its commitment. It's important."

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- read the Reuters news
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