Question

1. How are Genzyme’s and Sanofi’s business models similar? How do they differ?

Answer 1

Sanofi is a French based multinational pharmaceuticals company.

Genzyme is a wholly owned subsidiary of Sanofi based out of USA.

Commonalities and differences between the two companies:

1. Both are in the same sector : Pharma.

2. Both are in the business of manufacturing drugs and pharmaceuticals. However Genzyme is predominantly a biotech company, wherease Sanofi has broader product reach including OTC drugs.  

3. The business model , is development and selling drugs. While Genzyme would focus on specialized diseases and prescriptive medication which are under licences, Sanofi sells OTC drugs and generic drugs as well.

4. The business model of Genzyme would be high cost and high reward basis. As and when new molecules are developed by Genzyme , they would be able to market and sell it for specific diseases at higher cost.

5. Sanofit would be more into volume business, since it can procure rights to make OTC and generic drugs, and deal in volume business with scale of operations being much larger than Genzyme.

6. This shows in the resultant revenue and profitability of both companies :

Sanofi's scale being more than 6 x that of Genzyme (in 2019).