Sanofi's MS Drug Faces Double Setback—Why Investors Are Hitting the Exit Button

Sanofi’s shares took a hit on Monday, dropping nearly 2% after the pharmaceutical giant disclosed two significant complications with tolebrutinib, its experimental MS drug candidate. The developments have rattled investor confidence in what many had viewed as a key growth pillar for the company.

The Root of the Problem: Clinical Trial Disappointment and Regulatory Delays

The troubles for Sanofi’s MS drug initiative stem from two distinct but equally damaging announcements. First, the company revealed that tolebrutinib failed to achieve its primary endpoint in the PERCEUS phase III trial, which was designed to evaluate the drug’s efficacy in patients with primary progressive MS (PPMS)—a subset representing roughly 10% of the MS patient population. Though safety data remained consistent with earlier studies, the efficacy miss prompted Sanofi to halt further development in this indication.

Simultaneously, Sanofi announced that the FDA has pushed back its decision timeline yet again on the company’s application for nrSPMS (non-relapsing secondary progressive MS) treatment. Originally scheduled for September 28, 2025, the approval decision has now been rescheduled to the first quarter of 2026. This marks the second extension—the previous delay extended the deadline to December 28, 2025 after Sanofi submitted expanded access protocols at regulators’ request, which the FDA classified as a major amendment.

Why the Market Reacted Negatively

Investors had pinned significant hopes on tolebrutinib as a diversification strategy for Sanofi’s revenue streams, which currently remain heavily dependent on Dupixent for growth momentum. The dual disappointment—a failed clinical trial in one MS indication coupled with extended regulatory uncertainty in another—has created a credibility gap between company reassurances and market sentiment. While Sanofi maintained confidence in the risk-benefit profile of tolebrutinib for nrSPMS, the Street was less convinced, triggering the Monday selloff. Year to date, SNY stock is down 1% compared to the broader biotech sector’s 16% upswing.

Historical Context: This Isn’t Tolebrutinib’s First Stumble

Tolebrutinib’s path has been rocky since its arrival in Sanofi’s portfolio through the 2020 acquisition of Principia. In 2022, the FDA imposed a partial clinical hold on the drug’s phase III studies across MS and myasthenia gravis (MG) indications after detecting drug-induced liver injury cases among trial participants. The MG program was subsequently discontinued in 2022 following evaluation of the competitive treatment landscape at that time.

What Comes Next

Full safety and efficacy data from the PERCEUS study will be presented at a future medical conference. For Sanofi, the path forward hinges on whether the nrSPMS indication can secure FDA approval in early 2026—a decision that could substantially reshape investor appetite for the stock and the company’s growth narrative in the highly competitive MS therapeutics market.