Sanofi's Shantha Biotechnics gets manufacturing issues resolved

Sanofi CEO Chris Viehbacher

Sanofi CEO Chris Viehbacher had a vision for Indian vaccinemaker Shantha Biotechnics when he paid more than $775 million for control of the company in 2009. Its low-cost manufacturing would allow the drugmaker to tap emerging markets with affordable vaccines. But almost immediately that plan went awry when manufacturing problems led the drugmaker to lose a big contract to supply a pentavalent vaccine to those markets. The company now says those issues are behind it, and the World Health Organization (WHO) agrees.

The drugmaker said Monday that WHO inspectors have signed off on Shantha's plant in Hyderabad, India. The agency has reviewed comprehensive data about the process and the product characteristics, and tagged its Shan5 with a prequalification. The designation allows the vaccine to be sold to United Nations agencies, primarily UNICEF, it said. The vaccine received marketing authorization in India in March.

This is déjà vu for Shantha, which had everything approved and was shipping the vaccine to countries around the world when in 2010 reports of white sediment in some vials caused UNICEF to halt its vaccination program. It gave the company two months to find and fix the issue but then pulled the contract and awarded it to competitor Crucell when Shantha was unable to get to the root cause. The problems resulted in the destruction of 24 million doses of the vaccine and Viehbacher's hopes for early success with the newly acquired unit.

Sanofi ($SNY) sent in people to help the Indian company, processes were improved, and adjustments were made, but it has taken nearly 4 years to get back to square one with the vaccine. "The development of Shan5 benefitted from Sanofi Pasteur's more than 50 years of experience with whole-cell pertussis and combination vaccines--ensuring robust processes and guaranteeing international quality standards," Shantha CEO Harish Iyer said in a statement.

- here's the announcement

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