Sanofi pulls out of Zika vaccine collaboration as feds gut its R&D contract

Sanofi didn't know it would be walking into a firestorm when it teamed up with the U.S. Army to develop a Zika vaccine. But as the French drugmaker was negotiating an exclusive license on the potential product, that's just what happened—and now, the government is backing away from the collaboration.

The decision means Sanofi won’t further develop or license the U.S. Army’s promising Zika candidate, the company said Friday. The Department of Health and Human Services’ development arm BARDA had committed $43 million in research funding, with another $130 million available if the vaccine advanced into later-stage testing.

The partners blamed Zika's "evolving epidemiology" for the change; after an explosive early outbreak, the virus' spread has slowed. BARDA will continue to fund a Zika-related study, according to the announcement, and the partnership is headed to a point "where development would be indefinitely paused but could be restarted if the epidemic re-emerges."

As industry-watchers know, the collaboration had come under intense public and political scrutiny this year as critics demanded pricing guarantees if a commercial vaccine grew out of the taxpayer-funded research. After the nonprofit Knowledge Ecology International raised the issue late last year, a number of politicians and public officials joined in to call for pricing assurances on the license.

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Scientists with the U.S. Army originally developed the candidate.

It was a Federal Register notice about the exclusive license that touched off the hot public debate, with a chorus of critics growing over the course of the year. Sanofi executives defended the company on several occasions by saying it was contributing its own development resources, risking money, staff and time to pursue a project that might never yield a commercial product.

Sanofi also said the potential vaccine was just that—a potential product, far from a sure thing—and talking about pricing guarantees so early in the process didn't make sense. The drugmaker pointed out that the proposed license would require it to pay milestone and royalty payments back to the government.

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For his part, a U.S. Army official said exclusive licenses are often the only way to attract a competent pharma partner for such development projects. He added that the Army can’t enforce future vaccine prices.

In response to Zika’s fast spread in 2015 and 2016, research teams quickly mobilized to work on vaccines against the virus, with a number of pharma companies pairing with the U.S. government. Sanofi’s was one such collaboration.

The government is also partnered with GlaxoSmithKline and Takeda on two separate Zika vaccine approaches. Takeda's collaboration with BARDA is worth up to $312 million.

RELATED: U.S. Army can't add a pricing safeguard to Sanofi's Zika vaccine license, official says

More recently, though, the virus’ spread in the U.S. and around the globe has slowed. That fact, plus phase 1 results for the shot, made it "necessary to substantially extend our projected vaccine development timelines," according to Friday’s announcement from the drugmaker. All of that considered, Sanofi said it respects "BARDA’s decision to re-purpose limited resources to meet their priorities."

Vaccine experts have expressed frustration lately that the scientific community has been reacting to recent deadly emergencies rather than conducting early research ahead of an epidemic. Nonprofits and governments recently came together to form the Coalition for Epidemic Preparedness Innovations to try and improve on the vaccine R&D status quo.