Sept 2 (Reuters) - Sanofi's most advanced

multiple sclerosis (MS) drug candidate has missed the main goal

of two late-stage trials to treat relapsing forms of the

disease, dimming the prospects for a widely-pursued class of

drugs.

The French drugmaker said on Monday that two Phase III

trials showed that its experimental daily pill tolebrutinib was

not better than its established MS drug Aubagio in reducing

relapse rates in a highly common form of MS characterised by

isolated flare-ups followed by temporary improvements.

In a mitigation of the setback for Sanofi, the company said

a separate third late-stage trial showed that tolebrutinib met

the main goal to treat a progressive - or steadily worsening -

form of MS, which is less common and which currently cannot be

treated.

In that trial, the Sanofi drug candidate slowed disability

progression when compared with placebo, an ineffective dummy

drug.

"Tolebrutinib represents an unprecedented breakthrough as a

potential first-in-disease treatment option with clinically

meaningful benefit in disability accumulation," said Houman

Ashrafian, head of research & development.

The company added it would discuss those results with

regulators, aiming to file for approval by the end of 2024.

Sanofi is pursuing several opportunities in MS, a

debilitating nerve disease, to offset revenue losses after the

recent end of the Aubagio pill's patent protection, part of a

push to become a powerhouse in anti-inflammatory drugs.

CEO Paul Hudson has been trying to regain investor

confidence in the pharma pipeline since he unexpectedly

abandoned 2025 margin targets last October to boost drug

development spending.

Its shares have bounced back somewhat over recent months on

the strength of drug launches including Beyfortus to protect

infants against a common respiratory infection.

Tolebrutinib, from the $3.7 billion takeover of Principia

Biopharma in 2020, belongs to a class of compounds known as

Bruton's tyrosine kinase (BTK) inhibitors, which has also

attracted drug majors Novartis, Roche and Merck

KGaA.

They are designed to selectively block the harmful

autoimmune reaction behind MS for a more targeted approach than

standard immunosuppressant drugs.

Investors, however, have been kept on edge over revenue

prospects because of a possible link to liver damage and

uncertain efficacy.

In 2022, concerns over liver damage led to a halt in the

enrolment of new patients in three of Sanofi's tolebrutinib

studies that were still recruiting volunteers at the time.

On Monday, Sanofi only said liver safety was consistent with

previous studies, with more data to be disclosed on Sept. 20.

Merck KGaA's BTK inhibitor, too, had been under scrutiny for

liver safety. That drug last December missed its efficacy goal

in MS trials, a major blow to the German company's growth

ambitions.

Roche subsidiary Genentech is still in the race, but safety

concerns about its BTK inhibitor have also emerged last

November. Rival Novartis has said that its BTK drug candidate

had shown no signs of liver damage.

Sanofi on Monday only provided a brief summary of the two

relapsing-MS trials called GEMINI I & II and of the HERCULES

trial on a form of progressive MS.

It said details would be presented at the European Committee

for Treatment and Research in Multiple Sclerosis (ECTRIMS)

conference in Copenhagen on Sept. 20.

Another Phase III study known as PERSEUS in another

progressive form of MS is still ongoing with results expected in

2025, Sanofi added.