Breakthrough Eczema drug by Sanofi
Sanofi and Regeneron Pharmaceuticals said their breakthrough anti-eczema drug has cleared big clinical trials [Representational Image]Reuters

Drug-makers Sanofi Pasteur and Merck & Co announced Tuesday their intent to end their joint vaccine operations in Europe, and independently manage their product portfolios and pursue their own distinct growth strategies in the continent.

Sanofi Pasteur and Merck (known as MSD outside the United States and Canada) expect the parting of ways to be completed by the end of 2016, subject to local labour laws and regulations and regulatory approvals. Upon concluding their joint venture, both companies plan to integrate their respective European vaccine businesses into their operations.

The European joint venture Sanofi Pasteur MSD, formed between Sanofi Pasteur — the vaccine division of Sanofi — and MSD, is owned on a 50-50 basis. It was created in 1994 to develop and commercialise vaccines originating from both companies in 19 European countries, making use of the combined expertise resulting from Sanofi Pasteur and Merck's research.

Sales of Sanofi Pasteur MSD were €824 million in 2015. 

According to Sanofi Pasteur MSD's website, it is a major supplier of flu vaccines in Europe and also distributes Gardasil, which is used against cervical cancer. Other big product lines include vaccines against shingles, hepatitis, yellow fever and childhood diseases.

Sanofi Pasteur and MSD jointly issued a statement saying the decision was reached after "carefully considering our individual strategic priorities, alongside the economic and regulatory environments for vaccine operations" in the region. "...It is in our best interests to manage our vaccine product portfolios independently," they said.

The financial terms of the termination were not disclosed, but any impact on jobs would be managed responsibly, the companies said in the statement.