The Avanti Group the equities research house based in Tokyo, providing professional trading and investment research solutions to institutional and private investors across the globe have recently drawn their investor’s attention to recent developments in the biotech and pharmaceuticals industry.

The agreement between Sanofi and Medtronic which was announced on June the 14th will be aimed primarily at formulating new ways to simplify insulin usage, while improving treatment compliance. The arrangement between the two companies comes at the same time as Medtronic seeks to purchase the Dublin based Covidien Plc for over $40 billion. A successful buyout would add a greater line-up of hospital equipment to the Minneapolis-based Medtronic’s range while the cooperation with Sanofi sees it expand its diabetes offerings with Sanofi, which is motivated to seek new avenues of growth due to its patent on Lantus, expiring in 2015. In 2013 Lantus sales earned the company €5.72 billion, $7.6 billion.

Sanofi CEO Chris Viehbacher created the diabetes unit for Paris-based drug maker in 2009, following on from there two years later with the company introducing blood diagnostic devices, including a model that can be linked to Apple Inc’s iPhone. Medtronic already manufactures its own MiniMed 530G artificial pancreas device, used in the treatment of Type 1 diabetics.

“Epidemic tends to be thrown around a lot as almost a marketing catch phrase, but in the case of the U.S and diabetes it is the most fitting description. Drug makers have realized that the size of the market for diabetes care in the U.S is both a large and growing one as the nation becomes more obese on average,” said Martin Blanke Equity Research Specialist at The Avanti Group.

In the U.S alone nearly 21 million people are diagnosed with diabetes , with 5% of adult patients having Type 1 diseases, the condition in which the body fails to produce enough insulin. Type 2 diabetes which is prevalent also in the U.S is brought about by obesity and sedentary lifestyles, causing sufferers to become resistant to the insulin which their own body produces.

“This arrangement between the two medical care companies to deal with a specific disease is not the first to involve diabetes, nor will it be the last with such a large segment of the adult population in the U.S very likely to develop type 2 diabetes directly related to their obesity,” concluded Martin Blanke Equity Research Specialist at The Avanti Group.

The Avanti Group is an equity research house providing research and analysis outsourcing solutions for institutional financial traders worldwide, founded in early 2003.