The End of an Era for Big Pharma Conglomerates
Chirag Sharma
Associate Director | M&A Advisor | Ex- EY | Consumer Health | Private Equity
Sanofi recently announced plans to spin off its consumer health division, marking one of the last major pharmaceutical companies to move away from the diversified conglomerate model.
This move comes after Sanofi acquired the consumer health business in 2017 through a swap with Boehringer Ingelheim. Since 2019, it has operated as a stand-alone unit with significant autonomy. As CEO Paul Hudson commented, "They've earned the right to be a listed company and compete."
Sanofi will join peers like GSK and J&J in becoming a streamlined, pure-play biopharma focused solely on innovative drug development and commercialization.
As an engaged industry observer, I see this as the culmination of a two decade shift, as GSK, Pfizer, Merck, Novartis and now Sanofi have unlocked value by sharpening focus.
The implications are multifold:
While past models served a purpose, the new era of focus brings advantages across the board. Kudos to Sanofi on a defining strategic move to compete better. Excited to watch the revitalized company make its mark this decade as a more nimble biopharma powerhouse.
Chirag, I see your point. But something tells me that in about 10-15 years the pendulum will swing back again.