Sanofi splashes US$180 million worth of investment in French AI startup Owkin

FRANCE – Sanofi has announced an equity investment of US$180 million in French startup Owkin, whose predictive algorithms aim to improve cancer research and development.

According to company co-founder and CEO Thomas Clozel, the deal gives Sanofi a stake of between 10% and 15% in Owkin and elevates Owkin to the status of “unicorn” – a startup company valued at more than US$1 billion.

Arnaud Robert, Sanofi’s chief digital officer, oversaw the transaction, which also included a partnership in which Owkin agreed to build prognostic models and help evaluate the response to treatment against four types of cancer using its platform.

Sanofi said it would pay Owkin US$90 million up front for the first three years of their collaboration. If Owkin’s biomedical models are successful, the pharmaceutical company will make additional payments.

Owkin, which is also based in Paris, created its algorithms and artificial intelligence platform by deploying them in medical and research facilities.

It installs and runs servers locally in each of the data centers that have agreed to allow access to their data – the essential raw material from which Owkin’s algorithms sharpen their analytical capabilities.

This means that data pools aren’t centralized on a single platform, but instead remain in the hands of each individual hospital or research facility, according to Owkin.

The process, though costly, ensures that the medical data are kept locally and lowers the risks of any hacking.

In other related news, Sanofi Genzyme has agreed to pay US$180 million to resolve a dispute with Taiwanese company over patents aimed at treating a rare neuromuscular disease, ending a longstanding arbitration over royalties.

Genzyme initiated the initial arbitration after disputing its European royalty obligations for patents used in the treatment of Pompe disease, an inherited, progressive, and often fatal disease that affects one in every 40,000 newborns worldwide.

According to International CSRC, Genzyme later initiated a separate arbitration claiming that Genzyme’s U.S. royalty obligation expired on July 10, 2021, rather than February 26, 2023.

The drug’s sales increased by 8.4 percent at constant currency to 749 million euros (US$842 million) in the first nine months of 2021.

Lumizyme, also known as Myozyme, was discovered by Duke University researchers thanks to the efforts of Taiwanese scientist Yuan-Tsong Chen and colleagues.

Synpac hired Genzyme to develop the drug after acquiring the intellectual property in 2000. According to a previous Genzyme securities filing, Genzyme is supposed to pay Synpac royalties on Lumizyme net sales ranging from the mid-single digits to the mid-teens, depending on patent coverage in a specific country.

Lumizyme is currently the most valuable asset in Sanofi’s rare disease portfolio, with third-quarter sales of 266 million euros (US$298.55 million) representing a 10.4 percent increase at constant exchange rates, driven by new patients starting treatment.

Sanofi launched Nexviazyme, another Pompe therapy, in the United States in August for late-onset disease.

A phase 3 trial evaluating long-term enzyme replacement therapy in infantile-onset Pompe disease is currently underway at the French pharmaceutical company.

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