Sanofi Shares Fall After FDA Rejects Key MS Drug Over Liver Safety
U.S. regulator cites 'substantial and unusually high' risk of liver injury and unclear benefit for tolebrutinib, a blow to the French drugmaker's pipeline.
Sanofi’s shares declined after the U.S. Food and Drug Administration formally rejected its closely watched multiple sclerosis drug, tolebrutinib, dealing a significant setback to a key asset in the French pharmaceutical giant's development pipeline. The stock traded down about 1.5% to $47.51 in recent activity.
The agency issued a Complete Response Letter for the experimental therapy, citing a benefit-risk profile that was not favorable for any patient group. The regulator's review highlighted a "substantial and unusually high" risk of drug-induced liver injury, a concern that overshadowed the drug's potential benefits.
The FDA's decision, detailed in documents released in late December 2025, pointed to six cases of severe liver injury among roughly 2,700 trial participants. The agency review concluded that the risk of fatal liver damage with tolebrutinib "appears to be among the highest in the class" of drugs known as BTK inhibitors.
"A favorable benefit-risk profile could not be established for any patient subpopulation," the FDA stated in its reasoning. Sanofi had hoped to position the drug for patients with non-relapsing secondary progressive multiple sclerosis (nrSPMS), a group with no currently approved treatments. However, the FDA was not swayed, noting it was unable to "identify a population for which the benefit could be clearly established and for which that benefit would be anticipated to outweigh the serious risk of severe DILI to support approval."
For Sanofi, the rejection crystallizes a major pipeline disappointment. Tolebrutinib was once hailed as a potential blockbuster, part of a new class of therapies aimed at treating the underlying inflammation that drives multiple sclerosis. The company acquired Principia Biopharma for $3.7 billion in 2020 to gain full rights to the drug.
While the news is a blow, some analysts have suggested the financial impact may be contained. In December, commentary noted that the rejection was not expected to alter Sanofi's 2025 financial guidance, as tolebrutinib accounted for a relatively small portion—around 4%—of the company's total valuation. The Paris-based drugmaker has a market capitalization of approximately $116.85 billion.
In a statement from December 24, 2025, Sanofi acknowledged the FDA's decision and confirmed it would continue its ongoing clinical trials for tolebrutinib in other forms of MS, including relapsing MS and primary progressive MS. The company also stated it would conduct an impairment test on the intangible asset value of tolebrutinib, with the results to be disclosed in its upcoming fourth-quarter earnings report.
The setback for tolebrutinib underscores the high bar for new entrants in the competitive multiple sclerosis market. Despite the clinical hold on new patient enrollment in the U.S. since 2022 due to the liver toxicity concerns, Sanofi had continued to gather data and express confidence in the drug's future. The company says it remains committed to working with the FDA to address the agency's concerns.
Even as it deals with the fallout, Sanofi continues to make other strategic moves. On Tuesday, it was announced that the company made a $30 million investment in Enable Injections, a healthcare company focused on drug delivery systems. The move indicates Sanofi's ongoing commitment to broader innovation in treatment administration, separate from its immediate pipeline challenges.