Abandoning the ship

Abandoning the ship

It’s been awhile since we checked in with our Chardonnay guzzling friends in Paris as well we weren’t sure they were still in diabetes. Now they have not sold off or closed their diabetes franchise as Johnson and Johnson (NYSE: JNJ) has done, although given the way things are going in Paris they might want to consider this option. Listen this is the wacky world of diabetes where anything can and usually does happen even when it makes no sense whatsoever.

Unfortunately, it appears that Sanofi (NYSE: SNY) is a glutton for punishment and wants to remain in this wacky world of ours. While the company has many problems in diabetes one big one is holding onto the people they have in diabetes. This morning we learned that Philip Just Larsen, M.D., Ph.D their global head of diabetes research and translational medicine is leaving the company and headed to Grünenthal. Mr. Larsen is just the latest Sanofi diabetes executive to leave the company voluntarily not to mention all the diabetes executives the company has beheaded.

With all this turnover its hardly shocking that the company has screwed up the launch of their short-acting biosimilar insulin Amedlog. During a recent earnings call the company in a rare moment of honesty acknowledged they had missed the 2018 contracting season with payors. What’s that we keep saying about these companies screwing up a simple peanut butter and jelly sandwich.

Listen Amedlog should be a no-brainer for Sanofi, just follow the playbook that Lilly (NYSE: LLY) used when they launched Basaglar. But nope this requires the company to do something they have never done, execute. We seriously believe Sanofi should buy Tandem (NASDAQ: TNDM) if for no other reason is that neither company has demonstrated anything but the ability not to execute. And given that Sanofi just loves to through money around why not.

Keep in mind that this is a company that invested $250 million in a partnership with Google which has produced… zilch, nada, nothing. Now are we surprised by this, absolutely not. As we have noted on many occasions Sanofi has the worst track record when it comes to diabetes partnerships, kinda like the Cleveland Browns and first-round draft picks. But just as the Browns fans continue to support their team, Sanofi stakeholders don’t seem to care that the company continues to make investments which fail to yield any return on investment.

The real question is why Google hasn’t done what others have done before them and end the charade and find a new partner. It’s not like they cannot afford to pay Sanofi off. Yet knowing how Sanofi operates it’s likely they would have to pay Google if Google decides to end the partnership. Keep in mind this is the same company that did a deal with MannKind (NASDAQ: MNKD), ended that deal and because of the contract continued to pay MannKind even after the contract was terminated. Thank you, Al Mann.

Nor is it likely that Google would have any problems finding a replacement as we’re sure Lilly and Novo Nordisk (NYSE: NVO) would happily file the void.

Now the likelihood of this happening is about as likely as the Browns having a winning season next year. Like the Browns when it comes to diabetes Sanofi is in a continual state of rebuilding. Yet it’s hard to root for Sanofi as the majority of their wounds are self-inflicted. Which is likely why so many executives have left and why others not in diabetes have no interest in being transferred to diabetes.

But this won’t stop the company from doing what they do best, throwing money around. Sanofi throws money around like a farmer spreading fertilizer hoping something good will grow. The big difference is the farmer takes the time to figure which crops to plant, which will grow and offer the greatest return on their investment. The farmer puts some THOUGHT into it BEFORE they plant. Sanofi just gets out the manure spreader and hopes something good will grow.