Sanofi SA (NYSE:SNY) Hit With Cease And Desist Order On Dengue Vaccine Ads in The Philippines

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Sanofi SA (NYSE:SNY) Hit With Cease And Desist Order On Dengue Vaccine Ads in The Philippines

The Philippines Food and Drug Administration has ordered Sanofi SA (NYSE:SNY) to desist from advertising its dengue vaccine or face major consequences. The agency says the company’s promotional activities in malls, radio and TV stations are illegal.

Dengue Vaccine Ads Ban

The regulators have also asked the French company to explain why it should not be sanctioned having failed to adhere to an initial cease and desist order issued on December 13, 2016. Sanofi reportedly continued to advertise the vaccine until December 15 while knowing very well the ban was in place.

“Since Sanofi has not complied, we have issued summons directing them to cease and desist from airing the advertisements and Show Cause why they should not be penalized for violating the law,” said FDA Director General, Nela Charade G. Puno.

Sanofi in a statement has confirmed that it has taken down the ads. In defense of the order, the company says the same was in connection to a disease awareness campaign it carried out. However, the Philippines generic drug law prohibits companies from carrying out aggressive marketing campaigns on drugs that can only be dispensed by doctor’s order.

Sluggish Dengue Vaccine Sales

For Sanofi the Cease and desist order is a big blow given that the country accounts for a huge amount of returns generated by the vaccine. The company spent $1.5 billion to develop the vaccine with an eye on the Philippine where the dengue is an epidemic. With the company now unable to reach the mass market through adverts, sales for the vaccine are only expected to continue tanking.

Sales in the country have been sluggish even on an aggressive marketing campaign. For the first three-quarters of the year, the company generated €50 million compared to expectations of €200 million for the full year. Turmoil in Latin America all but led to a further decline in sales especially in the second quarter of last year, as the company posted only €1 million in sales. With order now in place, sales could tank even further.

Sanofi stock was up by 1.43% in Tuesday trading session consequently closing at highs of $41.02 a share.