Sanofi could invest between 1.3 and 1.5 billion euros to modernize its insulin production site in Germany, a source close to the project told Reuters on Monday.

Such an agreement would represent a further victory for Olaf Scholz's coalition government, which is seeking to attract foreign investment, particularly in the pharmaceutical sector.

According to the German daily Handelsblatt, the first to report on this potential investment project on Monday, Sanofi had initially planned to transfer production of its Lantus insulin brand to France. According to the newspaper, which cites German government sources, the laboratory is now more inclined to modernize its Frankfurt site in the Höchst district.

When contacted, Sanofi said it would not comment on specific investment projects.

A spokesman for the German government said that Chancellor Olaf Scholz was "very anxious" to hear about further developments in the case, but that it was up to the company to communicate on the subject.

The coalition government is seeking to bolster its economic credibility ahead of general elections next year.

Europe's largest economy is expected to return to growth of 0.3% to 0.4% this year, after contracting by 0.3% in 2023, the weakest performance among the richest eurozone countries. (Reported by Klaus Lauer in Berlin, written by Ludwig Burger ; French version by Kate Entringer )