"Sanofi will provide BioNTech access to its established infrastructure and expertise to produce over 125 million doses of COVID-19 vaccine in Europe", Sanofi said in statement.
The world has been scrambling to develop and produce enough anti-Covid vaccines, with innoculation drives hampered by limited stocks of doses and logistical constraints.
France had high hopes that its national champion Sanofi would contribute to a first wave of coronavirus inoculation.
The company signalled last February it intended to carve out its active pharmaceutical ingredients business, which provides biologically active components for drugs.
Sanofi said it expected the new company, which will be based in France and have 3,200 staff, to have sales of around 1 billion euros ($1.2 billion) by 2022.
Biond, a privately-held biopharmaceutical company, developing novel immunotherapies for cancer.
A Phase 1 study to evaluate the safety, tolerability, and preliminary anti-tumor activity of BND-22 in advanced cancer patients is planned to start by mid-2021.
That year, Sanofi secured an exclusive global licence to develop and market Principia Biopharma BTK'168 drug for treating multiple sclerosis and other central nervous system illnesses.