2010 R&D budget: $5.94 billion
2009 R&D budget: $6.18 billion
Change: Down 4 percent

Sanofi's research budget is about to expand significantly as it absorbs Genzyme's $847 million (2010) in R&D programs. Genzyme is slated to continue under its own brand as the new world headquarters for Sanofi's rare disease efforts. But it's all Sanofi's money from now on.

Under CEO Chris Viehbacher Sanofi has done just about everything that a pharma can do to shake things up. Viehbacher has redefined the company's R&D strategy, dropping some diseases and concentrating on others. He's made sizeable purchases and small ones--including a $635 million deal to acquire TargeGen. Sanofi also spent $500 million for BiPar, which had one of the most promising mid-stage cancer drugs in the world--until Sanofi investigators tested iniparib in a Phase III breast cancer study and saw it fall short of its primary endpoints. Viehbacher's outsourced substantial pipeline work to Covance. And he's added some high profile individuals to R&D, most notably Elias Zerhouni, who was appointed president, global research and development, replacing Marc Cluzel, who was name R&D chief before Viehbacher's arrival. As part of the same overall shakeup at the top he replaced Wayne Pisano at vaccines with Olivier Charmeil.

Sanofi has helped set the pace on innovative new pacts with academic groups, vowed to shift from an in-house focus to more licensing and alliances with biotech and joined the march toward emerging markets.

What it hasn't done is win any big drug approvals.

In a certain sense, it would be unfair to criticize Sanofi yet for an absence of R&D home runs. Viehbacher was brought in to turn the company around, not keep it pointed toward the same big patent cliff that has transfixed the biopharma analyst community. And turnarounds in drug R&D are not an overnight affair.

But R&D has a few clear shots on goal coming up, and Viehbacher will be expected to deliver or start explaining why these new strategies aren't bearing fruit. At the beginning of February, Sanofi Aventis portfolio included 55 projects in clinical development, 13 in Phase III or submitted for approval.

Sanofi says that Phase III studies will be completed later this year for five compounds currently in development. The diabetes drug lixisenatide has been building up solid Phase III data, including a recently concluded head-to-head study in which the drug edged out Byetta. Two-year data from the Phase III study of the once-daily oral MS drug teriflunomide (7 and 14 mg) reduced annualized relapse rates by 31 vs. placebo--the trial's primary endpoint. The risk of disability progression was also cut.

Sanofi is partnered with Regeneron on aflibercept, now in three late-stage cancer studies. Most of the final results should flow in around the middle of this year. There's outstanding new data on Sanofi's dengue vaccine, and a new plant under construction in France to make it in bulk. Sanofi's other hot Phase III assets includes ombrabulin. And Genzyme should be able to make a major contribution soon. Genzyme told investors just days before closing its deal with Sanofi that it expects three approvals by the end of 2013: Lemtrada (alemtuzumab) for multiple sclerosis, mipomersen for familial hypercholesterolemia and eliglustat tartrate for Gaucher disease type 1.