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The boards of both companies were scheduled to hold separate meetings on Sunday to discuss the status of a potential deal, but no final decision was likely to be made, said the sources, who declined to be named because the talks were not public.

French drugmaker Sanofi is still conducting due diligence on Genzyme's financial records and manufacturing operations, and discussions between the sides could linger into the week, sources said.

An agreement would come nearly nine months after Sanofi first put the idea to the U.S. biotech group.

Buying Genzyme will give Sanofi a new area for growth in the high-margin business of rare diseases as it seeks to make up for patent losses that will take out roughly a third of its 2008 sales base until 2013.

A deal is likely to be priced at roughly $74 per share in cash, or $19.2 billion, based on Genzyme's outstanding shares of 258.99 million as of October 29, plus a contingent value right, or CVR, with an intrinsic value of $5 to $6 a share, the sources said.

The CVR is a tradable instrument, which promises a payout to shareholders over time, based on the performance of Genzyme's experimental drug Lemtrada for multiple sclerosis. The drug is already sold under the brand name Campath for leukemia.

The nominal value of the CVR is expected to be between $12 and $15 a share, to be paid out over seven or eight years, assuming Lemtrada fulfills Genzyme's highest sales projections, according to one source.

That nominal CVR value is above what Wall Street had been expecting, said Mark Schoenebaum, an analyst at ISI Group.

"We suspect the market will deeply discount the vehicle," Schoenebaum said. "Our back-of-the-envelope calculations suggest that a $13.50 CVR that pays out over 7.5 years might trade at around $3 a share today. This assumes a 10 percent discount rate and 40 percent probability adjustment."

Since many Genzyme shareholders are short-term investors, the CVR could trade closer to $2 a share, according to one source. In that case, the deal would give Genzyme a tradable value of about $19.68 billion.

A BETTER DEAL

Sanofi Chief Executive Chris Viehbacher first told Genzyme CEO Henri Termeer he was interested in a deal on May 23 last year. He took an initial bid of $69 a share directly to Genzyme shareholders in October. But the two companies have entered direct negotiations on a higher price in recent weeks.

"A $74 cash deal makes financial and strategic sense for Sanofi. It removes a substantial overhang and gives a bridge over the patent cliff they face," said Marc Booty, a fund manager at Pictet.

Genzyme's stock traded at about $50 as recently as July, 2010. The stock closed Friday at $73.40.