Sanofi Abandons Licensing Deal With Maze Therapeutics After FTC Challenges The Proposed Transaction

On December 11, 2023, Sanofi released a statement that it will terminate its proposed $755 million licensing agreement with Maze Therapeutics (Maze) shortly after the Federal Trade Commission (FTC) issued an administrative complaint and authorized filing a complaint for preliminary injunction in the United States District Court for the District of Massachusetts to block the deal.

Under the terms of the proposed licensing agreement between Genzyme Corporation, a wholly-owned subsidiary of Sanofi, and Maze, Sanofi would acquire an exclusive license to Maze’s glycogen synthase 1 products and related technology, including its candidate MZE001, a drug in development to treat the potentially fatal genetic order Pompe disease. According to a statement by Jason Coloma, Ph.D., Maze’s CEO, the FTC’s challenge “is the first time ever the FTC has moved to block a license of a Phase 1 investigational medicine.” The challenge seems consistent, however, with revised draft merger guidelines proposed by the FTC and Department of Justice that indicate that transactions “should not entrench or extend a dominant position” by, for example, “[e]liminating a nascent competitive threat.”

The complaint alleges that Sanofi has been the dominant supplier of drugs that treat Pompe disease for over a decade and that the deal would eliminate competition from MZE001, a glycogen synthase 1 inhibitor in development at Maze that would compete with Sanofi’s drugs used to treat Pompe disease. The complaint raises two counts—one for alleged monopolization and unfair method of competition under Section 2 of the Sherman Act and Section 5 of the FTC Act; and one for illegal acquisition and unfair method of competition under Section 7 of the Clayton and Section 5 of the FTC Act. Unlike some other recent enforcement actions by the FTC, there is no standalone violation of Section 5 of the FTC Act alleged.

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