Goldman invests $150m in India biosimilars business

The investment takes the form of optionally convertible debentures. It follows a commitment of INR2.25 billion from Tata Capital Growth Fund in August and INR5.36 billion from True North in January. The latter transaction coincided with an internal restructuring at Biocon, which saw the company’s drug discovery and research division – which had previously collaborated with Mylan on a biosimilars program – merge with Biocon Biologics.

Kiran Mazumdar Shaw, chairperson of Biocon, described the most recent deal as a pre-IPO investment. “If you look at the valuation, then the stake sale is very small and we obviously are going to have a much bigger offering at the time of the IPO. This was a way to set a benchmark to make people understand what the value of the company is and how we are going about creating value,” she told The Economic Times.

Based on monoclonal antibodies, biosimilars are drugs with nearly identical effects to medications already on the market. They offer opportunities to increase access to biologics by stimulating price competition and may lower healthcare costs. Biocon Biologics has a product pipeline of 28 molecules. Eleven came from collaborations with Mylan, several more from collaborations with Sandoz, and the rest are being developed independently.

Five treatments have been commercialized, focusing on several kinds of cancer, diabetes, and infections among patients undergoing chemotherapy. Three are available in developed markets like the EU, Australia, the US, and Japan. Biocon Biologics is targeting annual revenue of $1 billion by 2022.

“The global growth of biosimilars, coupled with collaborative regulatory pathways, is taking place at a rapid pace to drive market competition, budget sustainability for healthcare systems and improved patient access to treatments. Biocon Biologics, with a proven R&D track record and established worldwide strategic partnerships, is well positioned to continue to grow and be a major global player in this dynamic segment of the pharmaceutical industry,” Som Krishna, a managing director in Goldman’s merchant banking division, said in a statement.

Annual revenue for Biocon’s biosimilars business grew 29% year-on-year to INR19.5 billion during the 12 months ended March. The parent company's overall revenue rose 15% to INR65.2 billion.

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• Topics
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• Growth capital