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Google Life Sciences Company Has New Deal, Official Nemesis in Diabetes

The Alphabet company, a sci-fi pharma lab, is also searching for a new name.

Little has dribbled out of Alphabet, Google’s new holding company and moonshot umbrella, since its unveiling three weeks ago. But one of its businesses, Life Sciences, has kept busy and is willing to gab about it.

On Monday, the medical research lab, which spun out of Google X to become its own standalone Alphabet firm, announced a deal with the French pharmaceutical company Sanofi to develop diabetes treatments. As in partnerships announced before, Google’s scientists will develop digital health systems and gizmos. Sanofi, which sells drugs for diabetics, will market them.

With the deal, Life Sciences also announced diabetes as its first official area of focus.

It’s not a surprising choice. The unit, which is led by biologist Andy Conrad, who’s now CEO, debuted with a smart contact lens designed to constantly measure glucose levels for diabetes patients. Conrad’s team signed a deal with drug maker Novartis for distribution. Two days after the Alphabet premiere, the unit inked another deal with a pharma firm, Dexcom, that specializes in diabetes treatments.

That latter deal actually gave financial terms — Dexcom will give $90 million to Google (now Alphabet), then a slice of its sales later on. That offered a sketch of how the Alphabet business, essentially an advanced tech pharma lab that outsources drug distribution, could develop.

It may take many years to emerge. The market cycle for the medical industry — development to licensing to FDA approvals, and everything in between — is very long, longer than selling ads online. Yet health care is a deeply personal interest for Google’s co-founders and now Alphabet execs.

Sanofi and Alphabet didn’t share terms. But it’s possibly a similar arrangement to Dexcom’s, with Conrad’s unit very likely getting data from the diabetic drugs as well. (Neither company specified the data component of the terms.) Sanofi brought in €9.4 billion ($10.5 billion) in sales last quarter. Diabetes medicines accounted for 21 percent of its sales, although they registered a drop of 3.8 percent due to competitive pressures.

A year ago, Sanofi signed a deal with Medtronic, a medical device manufacturer, to develop medicine and hardware to combat diabetes. That deal is now kaput. The parties could not reach an agreement, a Sanofi spokeswoman said.

As part of its diabetes focus, Alphabet’s Life Sciences is collaborating with the Joslin Diabetes Center at Harvard’s medical school. The company also has more sweeping medical problems on its docket. “We’ll have more details on our plans to tackle other diseases, like cancer, heart disease, and neurodegenerative conditions, in the coming months,” it said in a statement.

Oh, and it’s working to swap out the “Life Sciences” name for a better one. “Stay tuned,” the Alphabet company said.

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