The European Commission has approved a €400 million German aid measure for Sanofi-Aventis Deutschland to support the supply of human insulin and insulin analogues.
Germany will pay Sanofi a “public service compensation” under EU State aid rules in return for obligations designed to guard against production and supply bottlenecks for German patients, the Commission informed on Tuesday.
As part of the arrangement, Sanofi must build a new insulin factory at its Industriepark Frankfurt-Höchst site by 31 December 2032.
The company must also produce at least 1.1 tonnes of insulin a year at Frankfurt-Höchst until 31 December 2042, stockpile 1 tonne of insulin active pharmaceutical ingredients until the same date, and prioritise European Economic Area markets if shortages occur.
The Commission said Sanofi would close its German site without the aid, which it said would reduce insulin production capacity in Germany and leave only one production site in the wider European Economic Area.
It added that some products — including human insulin — would no longer be produced in the European Economic Area in that scenario, making European markets dependent on imports from non-EU countries.
How the aid was assessed
The measure was assessed under EU rules that allow governments to compensate companies for delivering a “service of general economic interest” — a public service obligation that the market would not otherwise provide on the same terms.
The Commission said it concluded the compensation would not exceed Sanofi’s net costs for meeting the obligation and that the agreement includes arrangements to avoid and recover any overcompensation.
The decision also follows a revision to EU rules made on 19 December 2025, which clarified that member states can support public service obligations to improve the security of supply of critical medicines and, in some cases, provide up to €20 million per year without notifying the Commission.
A non-confidential version of the decision will be published in the Commission’s State aid register under case number SA.115239 once confidentiality issues are resolved.
