Drivers Behind Choices 1

The strategic choices that Sanofi made from 2008 onwards were based on some key drivers.
First is the investment into biopharmaceuticals (biologics) by acquiring biologics capabilities – in this
case, Sanofi decided to extend its strategic partnership with Regeneron – an American biotechnology
company - in 2009 and builit on in 2015. The driving force of this decision is that the company realized
that biologics had lower attrition and superior pricing, less risk from generic threats. Moreover, Sanofi
hopes to achieve a competitive position in the area of immune-oncology, while the investment risk in
the field of biology is relatively small. With this strategic choice, Sanofi is relatively successful in
achieving her investment returns and product price advantages. On the other hand, strategically
building partnerships with well-know enterprises promotes its progress to successfully enter the
biotechnology area and achieve significant profits in investment in this market.
Second is the successfully strategic M&A of Sanofi with some companies (acquisition of Genzyme,
Medley and merging with BMP Sunstone. The key drivers for this decision are complicated. The first and
also most obvious factor is that Sanofi wants to empowers its influence in the world pharmaceutical
industry through the merger of pharmaceutical enterpriese in large and important markets around the
world (e.g. China, U.S, Brazil). By merging method, Sanofi can actively and quickly speed up its global
expansion progress and entrance to major markets. Another important factor that drives the M&A
decision of Sanofi is that it wants decrease the dependence on a single blockbuster product line
(traditional medicine). The merger of these foreign companies, which manufactures different products,
has changed Sanofi from a company that only provides traditional medicines become a company with
diversified pharmaceutical products. Although this M&A strategy is successful, it brought Sanofi some
disadvantages. The most important benefit that Sanofi acquired from the M&A is that the strategy
promotes its independence on a single blockbuster and start a stable and extensive global
pharmaceutical brand. However, so many mergers, especially with foreign companies, have greatly push
up Sanofi’s operating costs. The company also has to deal with management problems. To be more
specific, Sanofi must spend lots of time, money and effort on investment on these merged companies,
which are located in different countries, to get familiar and integrated with the local culture. It is
obvious that this integration cannot be achieved in the short term, Sanofi needs to bear a lot of
management costs as well as human and other assets, which can badly affect its resoures and
competitiveness in the market.
The third strategic choice that Sanofi made is harnessing the power of big data for personalized
consumer insights through the collaboration with Google Life Science (2015) to improve care and
outcomes for people with type 1 and type 2 diabetes. The driving force of this choice is also their
declared goal “to strive to shift from episodic, event-driven diabetes care to continuous, value-based
care.” By pair Sanofi’s leadership in diabetes treatments and devices with Google’s expertise in analytics,
miniaturized electronics and low power chip design, the combination can work on better ways to collect,
analyze and understand multiple sources of information impacting diabetes (Sanofi, 2015). Therefore,
patients will be easier to successfully control their diabetes, which would reduce the risk of
complications, improve outcomes and ultimately lower costs. The strategy was successful that has
brought new collaborations between Sanofi and Google Life Science in the future. In 2019, they
establish a new virtual Innovation Lab with the ambition to radically transform how future medicines
and health services are delivered by tapping into the power of emerging data technologies (Sanofi,
2019).
Last but not least, Sanofi introduced globalised operating model comprising three pillars in 2015.
Overall, Sanofi wanted to integrate global businesses and won the competetition with competitive
advantages. This complex strategy will helpin promote its development and influence in the global
pharmaceutical industry. Moreover, the choice may enable Sanofi to cut down operating costs by
concentrating on specific areas of strength. The strategy requires lots of effort and time to conduct and
receive the results. Therefore it cannot be realized in the short term, but it it undeniable the benefits it
would bring to Sanofi: reduction in management costs, improvement in its operational efficiency and
maintaining its position.

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The strategic choices that Sanofi made from 2008 onwards were based on some key drivers.

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