The breakdown came days after the U.S. Treasury issued new rules that weighed on Pfizer's ability to slash its tax bill by using the deal to redomicile in Ireland.
Earlier on Tuesday, Pfizer Chief Executive Ian Read said in an interview with Reuters that he would consider another merger of any size, as long as the deal makes sense. He did not comment on Medivation.
Sanofi is vying for Medivation in an attempt to expand in the lucrative oncology sector, as it struggles to compensate for declining revenues from a key diabetes drug that recently lost patent protection.
Sanofi's unsolicited approach for Medivation has echoes of its bid for rare disease drug maker Genzyme in 2011. It took Sanofi nine months to overcome Genzyme's resistance. It also offered Genzyme shareholders so-called contingent value rights, which offered them additional payments if the acquired company was able to achieve certain performance milestones.
Using contingent value rights in the case of Medivation may be more challenging for Sanofi, given its lackluster track record in cancer drugs. However, Sanofi has no plans to use contingent value rights in any new offer, according to the sources.