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Alphabet and pharma company Sanofi are teaming up to work on new diabetes treatments

Diabetes is one of the most lucrative areas of research

Chancellor Merkel Visits Sanofi Plant Photo by Thomas Lohnes/Getty Images

French pharmaceutical giant Sanofi SA and Alphabet-owned Verily Life Sciences LLC are investing $500 million in a joint venture that will address the global diabetes epidemic. The new company, called Onduo, will be led by Joshua Riff, previously an executive at UnitedHealth.

Onduo will initially focus on Type II diabetes, which affects 90 percent of those with the disease. This form of the disease develops when the body cannot properly use the insulin produced by the pancreas. It is usually treated with a combination of dietary change, careful monitoring of blood sugar levels, and insulin injections to correct the blood sugar levels.

Diabetes is one of the most lucrative avenues of health research because there’s a fortune to be made by the company who can develop a better blood glucose monitor. Rates of diabetes are rising, and 592 million people worldwide are expected to have the disease by 2035.

Sanofi is already one of the world’s biggest producers of diabetes drugs while Verily, owned by Google’s parent company, has more expertise in software and electronics development.

This isn’t the first time that Verily has partnered with big pharmaceutical companies. Just last month, Verily and British pharma giant GlaxoSmithKline created a new company called Galvani Bioelectronics to create electrical implants that can be used to treat diseases. The company is also known for its ambitious projects, which include a smart contact lens that is supposed to monitor blood sugar levels, and a FitBit-style wearable that aims to help with cancer detection.

However, former employees have criticized the venture for not delivering on its promises and even being "slideware," a derogatory term for big dreams that exist only in the world of PowerPoint. Over a dozen employees have left Verily in the past year.