Sanofi signs $300 million licensing deal for Lexicon's diabetes drug candidate

French drug major Sanofi (Euronext: SAN) on Friday said it has signed a collaboration and license agreement with Lexicon Pharmaceuticals (Nasdaq: LXRX) worth an upfront payment of $300 million to develop and market sotagliflozin, a drug candidate to treat diabetes.

Under the terms of the agreement, Lexicon is also eligible to receive development, regulatory and sales milestone payments of up to $1.4 billion. Lexicon is also entitled to tiered, escalating double digit percentage royalties of net sales of sotagliflozin. In return, Sanofi will get the exclusive worldwide license to develop, manufacture and commercialize sotagliflozin.

Pascale Witz, executive vice president, Sanofi, said: "This agreement with Lexicon reinforces our commitment to helping people living with diabetes. Adding sotagliflozin to our portfolio, which includes medicines at virtually every stage of the treatment pathway, highlights our focus on providing a large and diverse set of therapeutic options for people with this disease."