SNY Sanofi

By Matthew Dalton 
 

PARIS--Sanofi S.A. on Friday said it will work with German biotech company Evotec AG to develop a new class of medicines to treat diabetes.

Sanofi could pay Evotec up to EUR300 million ($327.8 million) for hitting various drug development milestones, plus additional royalties on net sales of the drugs.

The collaboration will use human stem cells to develop drugs that bolster "Beta" cells, which release insulin and become impaired in people with diabetes. The drugs could reduce the need for diabetes patients to inject themselves with insulin, Sanofi said.

Write to Matthew Dalton at matthew.dalton@wsj.com

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