Biocon hinges hopes on biosimilars and licensing revenues to drive future growth

Biocon, the Bangalore-based biopharma major, is hinging hopes on a healthy pipeline of biosimilars coupled with a steady increase in licensing revenues to drive future growth. It expects to see more of licensing revenues come in, with more of its R&D assets getting ready for monetisation.

For instance, in the first quarter of FY16, licensing revenues contributed to Rs 19 crore and the company expects to see this increasing going forward.

The first quarter of FY2015/16 (ended June 30, 2015) saw the company post 15 per cent growth in revenue to Rs 857 crore from Rs 742 crore in the same quarter last year. Consolidated net profit registered a 23 per cent growth to Rs 126 crore from Rs 103 crore in the same period.

At a conference call organised by the company on Friday, July 24, following the announcement of results for the first quarter, in response to a question from Business Today on the quantum of funds the company will need to spend to support its biosimilar programme every year, Biocon Chairperson and Managing Director Kiran Mazumdar-Shaw said it would be in the region of about 10 to 12 per cent of its biopharma revenues.

Arun Chandavarkar, the company's CEO and Joint Managing Director, said currently the developed markets have not yet opened up for biosimilars. The current revenue growth is coming from emerging markets, which is expected to only increase in the near term. At the same time, Mazumdar-Shaw says the company is preparing itself for developed markets.

Later, sharing details on the biosimilar programme with Business Today, the company's spokesperson said: "In Mylan, we have a long-standing strategic partner for our biosimilar programmes. Today, Biocon probably has one of the largest portfolios of generic insulins and biosimilar protein therapeutics in advanced stages of development. Currently, five partnered programs are in Phase III clinical development: insulin Glargine, Trastuzumab, Bevacizumab, Pegfilgrastim and Adalimumab."

In terms of specifics on its biosimilar clinical development programmes, the spokesperson pointed out that patient recruitment has been completed this quarter for the global Phase III trials of insulin Glargine for both Type 1 and Type 2 diabetes studies.

Also, its global Phase III clinical trials for Trastuzumab and Pegfilgrastim were progressing well towards completion. In addition, an initial emerging market focused Phase III trial for Bevacizumab was underway. This is in addition to Phase 1 global trials for Bevacizumab, which commenced in Europe, and the global Phase III clinical trial that has been initiated for Adalimumab.

Biocon's spokesperson says the company is on track to achieving 20 per cent of its revenues ($1-billion dollar revenue target for 2018) coming from biosimilars.