A consortium including French private equity firm PAI Partners has raised its offer for Sanofi's consumer health business, Opella, according to sources.
The group has revised its bid by €200m, challenging US private equity rival Clayton Dubilier & Rice (CD&R), for a 50% stake in Opella.
Sanofi plans to retain a 50% stake in the business and is seeking an investor for the other half.
As part of the new offer, PAI said it would protect jobs at French production sites in Compiègne and Lisieux, notably by investing at least €60m over five years.
It comes after PAI's first takeover attempts were shunned, with Sanofi last week confirming it was in talks with CD&R.
The possibility of a deal with the US firm has, however, caused uproar in France.
Opella is best known for its branded paracetamol, Doliprane, the country’s best-selling drug.
Fears over French jobs
Opponents are concerned that the sale will not only jeopardise French jobs but also leave the country vulnerable to medicine shortages - as experienced during the pandemic.
Politicians from across the political spectrum have entered the fray.
Far-right politician Jordan Bardella branded the sale as "unthinkable", while far-left Fabien Roussel called it "shameful".
A group of around 60 centrist and conservative politicians, meanwhile, sent an open letter to France's finance minister Antoine Armand on Friday, calling for a state intervention in the sale.
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In response to the potential deal, Sanofi workers began a strike on Thursday - urged on by unions.
Earlier this week, President Emmanuel Macron sought to offer reassurances, implying that a foreign stakeholder would not necessarily result in production cuts in France.
"I would make a distinction between two things: activity in France and capital ownership," he argued.
"On capital ownership, the government has the instruments to guarantee that France is protected. And so it's the government's job to look at that."
Ministers have added that state demands must be satisfied if CD&R's offer is to be accepted - and that the sale can be blocked if necessary.
While PAI's alternative offer may alleviate some concerns surrounding sovereignty, the French firm has not made the offer alone.
Within this consortium, it is a party among foreign investors such as Singapore's GIC and the Abu Dhabi Investment Authority.
Others underline that while Opella produces Doliprane in France, the active ingredient in paracetamol is still sourced in Asia.
The improved offer is valid until Sunday evening.
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