January 22, 2015
Research Services delivers 20% growth;
Board approves listing Syngene via Offer for Sale
Commenting on the quarterly performance and highlights, Chairman and Managing Director, Kiran Mazumdar-Shaw stated,"A significant ramp up in Research and Development expenses this quarter reflects advances made in multiple RnD programs. Two programs viz. trastuzumab and glargine are progressing well in global Phase III clinical trials, while two other biosimilar programs have entered the clinical stage globally. This clearly positions Biocon as having one of the largest portfolio of Biosimilars in the clinic. Our Research Services arm, Syngene, has reported the best quarter thus far at Rs. 220 crore which bodes well as the company prepares for a public listing. I am also pleased to announce the expansion of Biocon's Board with the induction of two new distinguished Board members: Dr. Jeremy Levin, former CEO of TEVA and Prof. Vijay Kuchroo, renowned immunologist and Director of the Evergrande Centre, Harvard Medical School. Biocon continues to invest in its uniquely differentiated Biosimilars portfolio, which straddles both Insulins and Monoclonal Antibodies. We are confident this will deliver short term growth in the emerging markets and drive long term value creation across global markets."
Highlights:
- Biocon inducts former TEVA CEO Dr. Jeremy M. Levin and Harvard Medical School Professor Dr. Vijay K. Kuchroo, as additional independent directors on its Board.
- Two additional global biosimilar programs enter the clinic.
- Recruitment of patients for the India clinical trial of biosimilar bevacizumab has commenced.
- Biocon, through its wholly owned subsidiary Biocon Research Limited (BRL), concludes the sale of its 10% stake in Syngene International Limited (Syngene) to M/s IVF Trustee Company Private Limited (on January 12, 2015)
- Biocon Board approves initiation of the process of listing Syngene and appointment of merchant bankers for the purpose. Biocon to offload 10 - 15% from its majority stake via an offer for sale.
- Biocon has entered into an agreement with US based Gilead Sciences to license its chronic hepatitis-C blockbuster product range including sofosbuvir and sofosbuvir/ledipasvir combination.
Business Performance:
Revenue : 779
Research and Development Expenses: 47
(9% of Biopharmaceutical sales)
EBITDA: 170 (EBITDA Margin: 22 %)
v PAT: 91 (PAT Margin: 12 %)
Biopharmaceuticals
Biopharma
The Biopharma segment recorded revenues of Rs. 436 Crore in Q3FY15, growing 4% YoY.
The business continues to be impacted by previously highlighted issues like credit risk in the Middle East, reduced offtake of specialty API and capacity constraints. We are working towards shifting sales to other markets. The regulatory process for qualifying our products in newer geographies is ongoing and we expect approvals to come through in the coming quarters.
Our biosimilar programs continue to make progress. Two additional global programs have entered the clinic. We have also commenced recruitment of patients for the India clinical trial of our biosimilar bevacizumab.
Trastuzumab licensing in emerging markets is making progress. We have licensed the product in one key emerging market geography this quarter and are in the process of finalizing agreements for more emerging markets.
Branded Formulations
The Branded Formulations business recorded revenues of Rs. 105 Crore in Q3 FY15, registering a growth of 6% YoY. For 9M FY15, the vertical grew 11% YoY, in line with the Indian Pharmaceutical Market (IPM). (IPM Source: IMS)
The Branded Formulations business is being developed as a specialty franchise to drive greater profitability through product and portfolio rationalization. This strategy has resulted in substantial increase in profitability over the past few quarters. Key brands in the Oncology and Metabolics portfolio continue to do well. CANMAb(TM), our biosimilar trastuzumab for treatment of HER2+ metastatic breast cancer has been one of the most successful launches of an oncology product in India. We are also evaluating entering into new specialty segments in line with our focus on having a specialty formulations franchise.
Biocon has also entered into an agreement recently with US based Gilead Sciences to license its chronic hepatitis-C, blockbuster product range including sofosbuvir and sofosbuvir/ledipasvir combination.
Research Services
The Research Services segment recorded Q3 sales of Rs. 220 Crore, delivering a growth of 20% YoY.
Commenting on this performance, Peter Bains, Director, Syngene International, said, "We are pleased with this quarter's robust performance which includes good traction from recent capacity expansions. Our order book is strong and we see this momentum continuing through Q4. We are on track to achieve our full year revenue growth guidance in the high teens."
On January 12, 2015, Biocon, through its wholly owned subsidiary Biocon Research Limited (BRL), concluded the sale of its 10% stake in Syngene to M/s IVF Trustee Company Private Limited. Post this stake sale, the holding of Biocon (including stake held by Biocon Research Limited) in Syngene stands at 85.54%.
In the board meeting concluded today, the Board of Directors of Biocon has approved the initiation of the process of listing of Syngene and the appointment of merchant bankers for the purpose. The board has authorized Biocon to sell 10-15% stock from its majority stake in Syngene via an offer for sale. The timing of listing of Syngene on the Indian stock exchanges will be dependent on regulatory approvals and market conditions.
Appointments:
Dr. Jeremy M. Levin, Additional Independent Director:
Dr. Levin, the former CEO of Teva Pharmaceuticals is currently the Chairman of Ovid Therapeutics Inc., a New York based private company developing novel medicines for orphan diseases of the brain and has deep experience in the global pharmaceuticals and biotechnology industry. He has played a significant role as a member of the Executive Committee at Bristol-Myers Squibb (BMS) where he had global responsibilities for strategy, alliances and transactions. Prior to that he was Head of Global Business Development and Strategic Alliances at Novartis and was the Chairman and CEO of Cadus Pharmaceuticals.
Dr. Vijay K. Kuchroo, Additional Independent Director:
Dr. Kuchroo is the Samuel L. Wasserstrom Professor of Neurology at Harvard Medical School, Senior Scientist at Brigham and Women's Hospital and Co-Director of the Center for Infection and Immunity, Brigham Research Institutes, Boston. He has just been named the Director of the newly formed Evergrande Center for Immunologic Diseases at Harvard Medical School and Brigham and Women's Hospital. Dr. Kuchroo's major research interests include autoimmune diseases and immuno oncology.
Dr. Kuchroo, was the first to describe the development of highly pathogenic Th17 cells, which have been shown to induce multiple different autoimmune diseases in humans. As an advisor to Biocon, he has made significant contributions towards scientifically positioning Itolizumab, developed by Biocon as a potential novel therapeutic for autoimmune diseases.
About Biocon
Biocon Limited, publically listed in 2004, (BSE code: 532523, NSE Id: BIOCON, ISIN Id: INE376G01013) is India's largest and fully-integrated, innovation-led biopharmaceutical company. As an emerging global biopharmaceutical enterprise serving customers in over 85 countries, it is committed to reduce therapy costs of chronic diseases like autoimmune, diabetes, and cancer. Through innovative products and research services it is enabling access to affordable healthcare for patients, partners and healthcare systems across the globe. It has successfully developed and taken a range of novel biologics, biosimilars, differentiated small molecules and affordable recombinant human insulin and analogs from 'Lab to Market'. Some of its key brands are INSUGEN(R)(rh-insulin), BASALOG(R) (Glargine), CANMAb(TM) (Trastuzumab), BIOMAb-EGFR(TM) (Nimotuzumab) and ALZUMAb(TM) (Itolizumab), a 'first in class' anti-CD6 monoclonal antibody. It has a rich pipeline of biosimilars and novel biologics at various stages of development including a high potential oral insulin. Visit: www.biocon.com
Disclaimer
Certain statements in this release concerning our future growth prospects are forward-looking statements, which are subject to a number of risks, uncertainties and assumptions that could cause actual results to differ materially from those contemplated in such forward-looking statements. Important factors that could cause actual results to differ materially from our expectations include, amongst others general economic and business conditions in India, our ability to successfully implement our strategy, our research and development efforts, our growth and expansion plans and technological changes, changes in the value of the Rupee and other currency changes, changes in the Indian and international interest rates, change in laws and regulations that apply to the Indian and global biotechnology and pharmaceuticals industries, increasing competition in and the conditions of the Indian biotechnology and pharmaceuticals industries, changes in political conditions in India and changes in the foreign exchange control regulations in India. Neither our company, our directors, nor any of our affiliates, have any obligation to update or otherwise revise any statements reflecting circumstances arising after this date or to reflect the occurrence of underlying events, even if the underlying assumptions do not come to fruition.
Media Contacts:
Biocon Limited
Seema Ahuja
Head-Corporate Communications
M:+91 9972317792
Email: [email protected]
Rumman Ahmed
M:+91 9845104173
Email: [email protected]