8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED):

December 31, 2007

GENZYME CORPORATION

(Exact name of registrant as specified in its charter)

Massachusetts	0-14680	06-1047163
(State or other jurisdiction of incorporation or organization)	(Commission file number)	(IRS employer identification number)

500 Kendall Street, Cambridge, Massachusetts  02142

(Address of Principal Executive Offices)  (Zip Code)

Registrant’s telephone number, including area code:

(617) 252-7500

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

oSoliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

oPre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

oPre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01       Entry into a Material Definitive Agreement.

Effective January 1, 2008, Genzyme Corporation (“Genzyme” or “the Company”) restructured its relationship (the “Restructuring”) with its joint venture partner, BioMarin Pharmaceutical Inc. (“BioMarin”) regarding the manufacturing, marketing and sale of Aldurazyme^® (laronidase).  As part of the Restructuring, the Company entered into a number of agreements (the “Restructuring Agreements”) with BioMarin and BioMarin/Genzyme LLC (the “LLC”), the joint venture entity owned fifty percent (50%) by Genzyme and fifty percent (50%) by BioMarin and its wholly-owned subsidiary, BioMarin Genetics, Inc. (together with BioMarin, the “BioMarin Companies”).

On December 31, 2007, Genzyme entered into a manufacturing, marketing and sales agreement (the “MMS Agreement”) with BioMarin and the LLC, effective as of January 1, 2008, pursuant to which BioMarin has agreed to assume the duties and obligations related to the manufacturing of Aldurazyme (including payment of expenses related thereto), while Genzyme has agreed to assume the duties and obligations related to the marketing, sales and distribution of Aldurazyme (including payment of expenses related thereto at a specified minimum level).  Genzyme has the exclusive right to distribute, market and sell Aldurazyme globally and is required to purchase exclusively its requirements from BioMarin.  The parties are subject to a non-competition restriction preventing them from participating in certain activities related to Aldurazyme and other pharmaceutical compositions of alpha-L-iduronidase (the “Collaboration Products”) for alpha-L-iduronidase deficiencies outside of the Restructuring Agreements.  Pursuant to the MMS Agreement, Genzyme will record sales of Aldurazyme and is required to pay BioMarin on a quarterly basis a tiered payment ranging from approximately thirty-nine and a half percent (39.5%) to fifty percent (50%) on worldwide net product sales.  Under the revised structure, payments are projected to result in both BioMarin and Genzyme receiving approximately the same profit as under the original joint venture structure.

BioMarin has also agreed to provide Genzyme with a limited number of vials of Aldurazyme for compassionate use and expanded access programs as well as a limited number of vials for in-country acceptance testing.  BioMarin and Genzyme have agreed to cooperate with each other in the filing of any necessary regulatory documentation, with BioMarin being generally responsible for all such filings in the United States and Genzyme being generally responsible for all such filings outside of the United States.  Each of BioMarin and Genzyme has agreed to indemnify the other party for its breach of the MMS Agreement, its negligence or willful misconduct in connection with performance of its obligations under the MMS Agreement and for certain product liability claims allocated to it under the MMS Agreement.

The term of the MMS Agreement is perpetual unless earlier terminated by Genzyme or BioMarin (a) for certain material breaches of the other party; (b) for convenience (with one year prior written notice); (c) in the event the other party enters into a change of control transaction; or (d) in the event of the other party’s bankruptcy.  Upon termination for a material breach, the breaching party will transfer its interest in the LLC to the non-breaching party, and the non-breaching party will pay a specified buyout amount for the breaching party’s interest in Aldurazyme and in the LLC (collectively, its “Interest”).  Upon termination for convenience, the non-terminating party will have an option to purchase the terminating party’s Interest at a specified buyout amount.  If such option is not exercised, all rights in Aldurazyme will be sold and the LLC will be dissolved.  Upon termination for a change of control, the terminating party will submit an offer for the non-terminating party’s Interest, pursuant to the terms and conditions in the MMS Agreement.  If the non-terminating party does not accept the offer, the non-terminating party is required to purchase the terminating party’s Interest for the same price as the offer.

Effective January 1, 2008, Genzyme, BioMarin and the LLC also amended and restated their collaboration agreement (the “Amended and Restated Collaboration Agreement”), pursuant to which LLC will no longer engage in commercial activities related to Aldurazyme and will solely (1) hold the

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intellectual property relating to Aldurazyme and other Collaboration Products and license all such intellectual property on a royalty free basis to BioMarin and Genzyme to allow them to exercise their rights and perform their obligations under the Restructuring Agreements; and (2) engage in research and development activities that are mutually selected and funded by Genzyme and BioMarin.  Pursuant to the Amended and Restated Collaboration Agreement, Genzyme and BioMarin license rights related to Aldurazyme to the LLC, and the LLC sublicenses these rights to Genzyme and BioMarin such that each may perform its obligations under the Restructuring Agreements.  The Amended and Restated Collaboration Agreement will automatically terminate upon the effective date of the termination of the MMS Agreement and may not be terminated independently from the MMS Agreement.

Pursuant to a members agreement entered into by and among Genzyme, the BioMarin Companies and the LLC related to the Restructuring, the LLC distributed cash and inventory to the BioMarin Companies and cash, accounts receivable and certain other assets and liabilities to Genzyme, such that the fair value of the net assets distributed to the BioMarin Companies and to Genzyme was equivalent.  The value of the assets will be determined after the year-end audit of the LLC.

The Company’s press release issued on January 3, 2008 related to the foregoing transactions and agreements is attached hereto as Exhibit 99.1.

Item 9.01               Financial Statements and Exhibits.

(d)    Exhibits.

 99.1        Press Release, dated January 3, 2008.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	GENZYME CORPORATION
Dated: January 4, 2008	By:	/s/ Michael S. Wyzga
		Michael S. Wyzga
		Executive Vice President; Chief Financial Officer

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EXHIBIT INDEX

Exhibit No.	Description of Exhibit
99.1	Press Release, dated January 3, 2008

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EX-99.1

Exhibit 99.1

Contact:

BioMarin	Genzyme
Investors	Investors
Eugenia Shen	Sally Curley
(415) 506-6570	(617) 768-6140
Media	Media
Susan Berg	Maria Cantor
(415) 506-6594	(617) 768-6690

For Immediate Release:

BioMarin and Genzyme Restructure Aldurazyme 50/50 Joint Venture

BioMarin will Continue to Manufacture;  Genzyme will Continue to Market and Sell Aldurazyme

Novato, CA, and Cambridge, MA, January 3, 2008 – BioMarin Pharmaceutical Inc. (Nasdaq and SWX: BMRN) and Genzyme Corporation (Nasdaq: GENZ) announced today a restructuring of their joint venture regarding Aldurazyme® (laronidase). Under the revised structure, the operational responsibilities for BioMarin and Genzyme will not significantly change. Genzyme will continue to globally market and sell Aldurazyme for mucopolysaccharidosis I (MPS I) and BioMarin will continue to manufacture Aldurazyme.

As of January 1, 2008, instead of sharing all costs and profits equally through the 50/50 joint venture, Genzyme will record sales of Aldurazyme and will pay BioMarin a tiered payment ranging from approximately 39.5 to 50 percent of worldwide net product sales, which will also be recorded by BioMarin as product revenue.  Under the revised structure, payments are projected to result in both BioMarin and Genzyme receiving approximately the same profit as under the original joint venture structure.  BioMarin will receive all of the benefits from increased manufacturing efficiencies and Genzyme will receive all of the benefits from increased commercialization efficiencies. Certain research and development activities related to Aldurazyme and intellectual property will continue to be managed in the joint venture on a 50/50 basis.

“This new structure provides both companies a better alignment of financial incentives with operational decisions and represents a more appropriate structure for two companies manufacturing and commercializing multiple products,” said Jean-Jacques Bienaimé, Chief Executive Officer of BioMarin.  “This structure will also reduce management time and provide stronger incentives for each company to maximize the efficiency of its own operations related to Aldurazyme.  Lastly, this new structure allows the companies to collaborate and equally share costs on research projects which could lead to important advances for MPS I patients.”

About MPS I

MPS I is a rare, progressive, heterogeneous, debilitating disease caused by a deficiency of the enzyme alpha L-iduronidase that affects an estimated 3,000 to 4,000 people worldwide, including approximately 1,000 in the United States. Patients who lack this enzyme accumulate a carbohydrate called glycosaminoglycan (GAG) in tissues and organ systems. A majority of patients die before adulthood due to a wide range of problems related to the disease, including progressive damage to the heart, lungs, liver, and kidneys. Aldurazyme addresses the underlying cause of MPS I by replacing the missing enzyme through a weekly infusion. More information about MPS I can be found at http://www.mps1disease.com.

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About Aldurazyme

Aldurazyme is indicated for patients with the Hurler and Hurler-Scheie forms of MPS I, and for Scheie patients with moderate to severe symptoms. The risks and benefits of treating mildly affected patients with the Scheie form have not been established. Aldurazyme has not been evaluated for effects on the central nervous system manifestations of the disorder. More information on Aldurazyme can be found at http://www.aldurazyme.com.

The most common side effects associated with treatment with Aldurazyme were upper respiratory tract infection, rash, and injection site reaction. The most common adverse reactions requiring treatment were infusion-related hypersensitivity reactions including flushing, fever, headache, and rash. The most serious adverse reaction reported with Aldurazyme was an anaphylactic reaction consisting of hives and blockage of the breathing tubes, which occurred in one person. Emergency surgery was required to help this patient breathe. This patient’s underlying disease may have contributed to the severity of this reaction. The majority of patients in clinical studies developed an immune response to treatment with Aldurazyme. The clinical significance of this response is unknown. Aldurazyme is available by prescription only. Full prescribing information is available at http://www.genzyme.com/corp/AZpi.pdf.Kuvan™.

About BioMarin

BioMarin develops and commercializes innovative biopharmaceuticals for serious diseases and medical conditions. The company’s product portfolio comprises three approved products and multiple clinical and preclinical product candidates. Approved products include Naglazyme® (galsulfase) for mucopolysaccharidosis VI (MPS VI), a product wholly developed and commercialized by BioMarin; Aldurazyme® (laronidase) for mucopolysaccharidosis I (MPS I), a product which BioMarin developed through a 50/50 joint venture with Genzyme Corporation; and Kuvan™ (sapropterin dihydrochloride) Tablets, a product for the treatment of phenylketonuria (PKU), developed in partnership with Merck Serono, a division of Merck KGaA of Darmstadt, Germany.  Other product candidates include 6R-BH4 for cardiovascular indications, which is currently in Phase 2 clinical development for the treatment of peripheral arterial disease and sickle cell disease, and PEG-PAL (PEGylated recombinant phenylalanine ammonia lyase) for the treatment of PKU.  For additional information, please visit www.BMRN.com. Information on BioMarin’s website is not incorporated by reference into this press release.

About Genzyme

One of the world’s leading biotechnology companies, Genzyme is dedicated to making a major positive impact on the lives of people with serious diseases.  Since 1981, the company has grown from a small start-up to a diversified enterprise with more than 10,000 employees in locations spanning the globe and 2006 revenues of $3.2 billion.  In 2007, Genzyme was chosen to receive the National Medal of Technology, the highest honor awarded by the President of the United States for technological innovation.  In 2006 and 2007, Genzyme was selected by FORTUNE as one of the “100 Best Companies to Work for” in the United States.

With many established products and services helping patients in nearly 90 countries, Genzyme is a leader in the effort to develop and apply the most advanced technologies in the life sciences. The company’s products and services are focused on rare inherited disorders, kidney disease, orthopaedics, cancer, transplant and diagnostic testing. Genzyme’s commitment to innovation continues today with a substantial development program focused on these fields, as well as immune disease, infectious disease and other areas of unmet medical need.

Forward-Looking Statement

This press release contains forward-looking statements, including without limitation statements about: expectations and plans related to the commercialization and manufacture of Aldurazyme; estimates concerning the MPS I patient population, and the anticipated benefits of the restructuring. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in these forward-looking statements. These risks and uncertainties include, among others: the effectiveness of Genzyme’s commercialization plan for Aldurazyme and Genzyme’s sales

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force; BioMarin’s ability to manufacture sufficient quantities of product and to do so in a timely and cost efficient manner; the accuracy of the companies’ information concerning the MPS I patient population; the content and actual timing of decisions by regulatory authorities concerning marketing applications, labeling and pricing for Aldurazyme and manufacturing facilities to be used for Aldurazyme; the companies’ ability to obtain and maintain adequate patent and other proprietary rights protection for Aldurazyme; and those factors detailed in BioMarin’s and Genzyme’s filings with the Securities and Exchange Commission, including, without limitation, the factors contained under the caption “Risk Factors” in BioMarin’s 2006 Annual Report on Form 10-K, as amended, the factors contained in BioMarin’s reports on Form 8-K, and the factors discussed under the caption “Risk Factors” in Genzyme’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2007.  Stockholders are urged not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Neither BioMarin nor Genzyme is under any obligation, and expressly disclaims any obligation to update or alter any forward-looking statement, whether as a result of new information, future events or otherwise.

BioMarin® is a registered trademark of BioMarin Pharmaceutical Inc.

Genzyme® is a registered trademark of Genzyme Corporation.

Aldurazyme® is a registered trademark of BioMarin/Genzyme LLC.

All rights reserved.

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