Germany: Commission approves EUR 400 million State aid to enhance insulin supply resilience
The aid, a compensation for providing a service of general economic interest (SGEI), is granted to Sanofi-Aventis Deutschland GmbH.
As part of its public service obligation, Sanofi will:
- build a new insulin factory at its site at Industriepark Frankfurt-Höchst by 31 December 2032;
- ensure an annual production of at least 1.1 tonnes of insulin analogues (insulins) at its Frankfurt-Höchst site until 31 December 2042;
- stockpile 1 tonne of insulin active pharmaceutical ingredients until 31 December 2042; and
- prioritise the European Economic Area (‘EEA’) markets in case of insulins shortages.
Without receiving the aid in question, Sanofi would close its German site. This would decrease the security of supply of insulins in the EEA markets, as no production sites would remain in Germany and only one production site would remain in the EEA. As some products, such as human insulin, would no longer be produced in the EEA, this would make European markets dependent on imports from third countries.
The Commission assessed the German measure under Article 106(2) TFEU and the 2012 SGEI Framework and found that the SGEI entrusted upon Sanofi is genuine, the compensation does not exceed the net costs of the provision of the public service obligation, arrangements have been made for avoiding and recovering any overcompensation, and the entrustment act complies with public procurement rules. This measure was assessed in the context of the Commission’s proposal relating to the Critical Medicines Act and its Guidance on the application of State aid rules in the context of the Critical Medicines Act.
For more information, see the Commission’s PR.