Sanofi, Transgene split cost of specialized manufacturing

Sanofi ($SNY) has picked up a new contract manufacturing client, one willing to pay half the cost of a manufacturing suite to make specialized immunotherapy products. 

The arrangement is with French biotech Transgene, which is developing vaccines using oncolytic tumor viruses, pathogens that infect and destroy cancer cells. The partners will each kick in €5 million ($6.43 million) toward construction of the "platform." Transgene will be a "preferred customer" for 15 years, but Sanofi will own the manufacturing operation and be able to use it for other contract customers.

Transgene CEO Philippe Archinard said the deal allows Transgene to work with a company that knows gene therapy and vaccines and will "secure Transgene's commercial production over the long run." That way the company can remain focused on development and marketing, he said. 

The suite will be built at Sanofi's Genzyme site near Lyon, France. Sanofi pointed out it will be an easy transition since that facility already manufactures polyclonal antibodies. The project will kick off in the third quarter, and they expect it to be complete and producing commercial-grade products in 2015. Transgene expects to file its first biologics license application in 2016. 

Transgene has four drugs in development and even has an option deal with Novartis ($NVS) for one cancer drug. But the biotech has found itself on the wrong side of the hepatitis C development divide with a drug for use with the standard injected therapy interferon while the big money is now being bet on all-oral regimens being developed by companies like Gilead Sciences ($GILD) and AbbVie ($ABBV). 

- here's the announcement