UPDATE 1-Sanofi moves into devices with diabetes test deal

* Links with AgaMatrix to sell blood sugar monitoring tests

* First products from alliance on sale later this year

* Move strengthens Sanofi position in diabetes market

(Adds Sanofi quotes, background)

By Ben Hirschler

LONDON, March 31 (BestGrowthStock) – French drugmaker Sanofi-Aventis
(SASY.PA: ) further broadened its healthcare business on Wednesday
by agreeing to develop blood sugar monitoring systems with
AgaMatrix, a privately held U.S. firm.

The move takes the group into the world of medical devices
and is part of a strategy by Chief Executive Chris Viehbacher to
diversify Sanofi, reducing its traditional reliance on branded
prescription drugs.

Viehbacher told Reuters last year he was interested in
certain areas of medical technology, including devices that
allow patients to measure their health at home.

“The vision of the company is to become a healthcare company
(so) it’s logical to look at some kinds of devices,” he said at
the time. [ID:nL5498514]

Under the terms of the agreement, AgaMatrix and Sanofi will
co-develop blood glucose monitoring devices that can simplify
the management of insulin therapy, where Sanofi is already a
leader with insulin drugs such as Lantus and Apidra.

Sanofi plans to start selling the first products from the
partnership in the second half of 2010, it said.

Financial terms of the collaboration were not disclosed but
the blood monitoring systems will be exclusive to Sanofi and
will be designed to work synergistically with its existing
diabetes treatments.

“This agreement is a concrete step towards fulfilling our
vision to deliver integrated solutions to patients and become
the partner of choice in the field of diabetes,” said Pierre
Chancel, head of Sanofi’s diabetes division.

Diabetes is a growing focus for global pharmaceutical
companies as the cases of the disease, which is linked to
obesity, increase worldwide.

AgaMatrix, based in Salem, New Hampshire, already develops
and manufactures a line of blood glucose monitoring products
featuring patented technologies that personalise each test to
provide improved accuracy.

Viehbacher has also put renewed emphasis on other areas of
diversification, including over-the-counter medicines, where he
recently agreed to buy U.S.-based Chattem for $1.9 billion.

He has also expanded Sanofi’s generic drugs business,
notably in the fast-growing emerging markets of Latin America
and Asia.

Stock Market Money

(Editing by David Holmes)

UPDATE 1-Sanofi moves into devices with diabetes test deal