UPDATE 1-Sanofi sells skincare unit, MS drug results positive

Mon Jul 11, 2011 3:34am EDT

* Dermik has about 140 staff in U.S., 200 in Laval, Canada

* Dermik sale for $425 mln in cash

* Lemtrada MS drug late-stage trial data "positive"

* Sanofi shares fall 0.3 pct

(Combines Sanofi statements, adds share price)

PARIS, July 11 (Reuters) - French drugmaker Sanofi (SASY.PA) plans to sell its Dermik skincare business to Canada's Valeant Pharmaceuticals (VRX.TO) for $425 million in cash, the latest drug giant to move to shed non-core assets.

The group said separately that late-stage tests on its Lemtrada experimental multiple sclerosis drug, which it inherited through the purchase of U.S. biotech Genzyme, were positive in reducing the relapse rate for the condition.

Sanofi had said previously that it planned to divest its dermatology business in the United States and Canada, whose brands include acne treatment BenzaClin and anti-face-wrinkle injection Sculptra.

"Our strategy is based upon our growth platforms and innovation," Sanofi Chief Executive Christopher Viehbacher said in a statement. "This divestiture allows us to rationalize our portfolio and improve focus on our core businesses.

"Our manufacturing operations in Laval (Canada) and our field operations teams will benefit from Valeant's stronger presence in dermatology."

The sale relects wider moves by major pharma groups to ditch non-core assets.

Pfizer (PFE.N) said last week it might sell or spin off its animal health and nutrition units -- businesses valued at more than $16 billion -- to focus on its main pharmaceutical business, while GlaxoSmithKline (GSK.L) is currently looking to sell a portfolio of over-the-counter products in an auction.

MS treatment Lemtrada is a key drug candidate at Sanofi's Genzyme unit, with the fortunes of the drug closely watched by holders of Genzme Contingent Value Rights GCVRZ.O issued to shareholders as part of the takeover deal.

"In this two-year comparative study, the effect of alemtuzumab (Lemtrada) on reducing relapses versus Rebif, a leading drug for the treatment of multiple sclerosis, is impressive," Viehbacher said in a separate statement.

Sanofi added that the Phase 3 trial was unable to provide evidence of a significant impact on disability in MS sufferers as "very few patients accumulated disability at the rate expected from previous clinical trials".

The results of another Phase 3 study to compare Lemtrada with Rebif in MS patients who have relapsed while on therapy are expected to be available in the fourth quarter, Sanofi added.

The company expects to file for U.S. and European Union approval of alemtuzumab in multiple sclerosis in early 2012 and has been granted fast track designation by the U.S. Food and Drug Administration.

Sanofi shares were 0.3 percent lower at 55.35 euros by 0720 GMT. They are up 16 percent this year. (Additional reporting by Ben Hirschler) (Reporting by James Regan; Editing by Hans-Juergen Peters)

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