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Reuters: Sanofi in $8.5B sell-off talks with Mylan, Abbott, private equity

'Phoenix project' would slim-fast Sanofi's European manufacturing, workforce
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Sanofi's Paris headquarters--Courtesy of Sanofi

We know plenty of Big Pharma companies are hawking portfolios of old products. What we don't know is who might buy them. One answer came earlier this week, when Mylan ($MYL) said it would acquire an ex-U.S. portfolio of Abbott Laboratories ($ABT) meds in a $5.3 billion stock swap.

Now, it might be Sanofi's turn--and Mylan and Abbott are part of that chatter, too. As Reuters reports, Sanofi ($SNY) has talked with both companies about a deal for a pool of older meds. The French drugmaker has also entertained potential private equity buyers, according to an internal document seen by the news service.

Potential price: €6.3 billion, or about $8.5 billion. Potential payoff for Sanofi, in addition to the price: less exposure to price cuts, a smaller manufacturing footprint in Europe, and some freed-up cash.

Unsurprisingly, a French union circulated the document; labor groups in France watch Sanofi's moves closely, particularly any moves that might affect jobs. That document concerns a plan--dubbed the Phoenix project--presented to Sanofi's investment committee in May. And the potential deal could affect up to 2,600 jobs, the news service says.

Sanofi isn't yet set on a sale, the document shows; it might create a joint venture instead. The 200 drugs include one of the French drugmaker's most successful ever, Plavix. The clot-buster is now off-patent, though, with much-reduced sales. Together, the portfolio brings in about €2.1 billion ($2.84 billion) per year, Reuters says.

The potential Sanofi move is part of a slim-down craze sweeping through pharma. Drugmakers are doubling down on their core strengths and getting out of fields where they're weaker. Novartis and Glaxo ($GSK) pulled off a multibillion-dollar asset swap in April; Glaxo picked up Novartis' ($NVS) vaccines unit and sold its own oncology line-up to the Swiss drugmaker. Merck ($MRK) followed suit shortly after with the $14.2 billion sale of its consumer health unit to Bayer.

- read the Reuters news

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