IGM antibody deal is latest casualty as Sanofi cools on cancer

Sanofi dropped the oncology-focused portion of its antibody discovery deal with IGM Biosciences, nearly halving the overall value from $6 billion to $3.2 billion. IGM, whose shares fell more than 11% on Wednesday, is the latest to feel the effects of the French pharma pulling back from cancer as it ups its commitment to immunology instead.   

Last week, Sanofi shuttered a pair of oncology acquisitions: Kiadis Pharma was closed down three years after its €308 million ($331 million) buyout; and a site and assets associated with Amunix Pharmaceuticals – bought for $1 billion upfront in 2022 – were offloaded.

IGM is also the second biotech in a week to lose out on billions in biobucks from a cancer deal struck years ago. Roche's Genentech unit terminated a $3-billion collaboration with Adaptimmune Therapeutics to develop T-cell therapies for cancer, for which it had paid $150 million upfront in 2021. For more analysis, see Vital Signs: Roche’s retreat from cell therapy.

IGM’s story is a bit more positive, as Sanofi will stick with the antibody developer for three immunology/inflammation targets, aligning with the pharma's planned shift in pipeline priorities. In December, the company earmarked immunology for increased research spending, while CEO Paul Hudson hinted at the JP Morgan Healthcare conference earlier this year that Sanofi plans to deprioritise oncology as an area of focus. "We are not out of oncology, but our bets are much earlier and that's changed the tonality because it's a huge consumer of investment in R&D," he said at the time.

New deal terms

Under their initial 2022 deal, Sanofi paid $150 million upfront to develop IgM antibodies against six targets, half for cancer and the other half for immune or inflammation-related diseases. 

IGM had agreed to lead R&D activities for the three oncology targets through to approval in the US or EU and was eligible for up to $940 million in milestones per target. Now, IGM will retain global rights related to the cancer targets nominated by Sanofi.

The biotech will continue to head up R&D for the immunology/inflammation targets through to the completion of a Phase I trial for up to two constructs directed to each target, after which Sanofi will handle all future development and related costs. IGM stands to gain nearly $1.1 billion in development, regulatory and commercial milestones per target, as well as tiered high-single-digit to low-teen royalties on global net sales.