Segmental Revenue Contribution
Bengaluru, Karnataka, India: October 30, 2024:
Biocon Limited (BSE code: 532523, NSE: BIOCON), an innovation-led global biopharmaceuticals company, today announced its consolidated financial results for the fiscal second quarter ended September 30, 2024.
Note: &: Revenue from Operations at Rs 3,590 crore, was Up 8% YoY after adjusting Q2FY24 revenue for Branded Formulations, India business.
“Biocon Group’s overall Q2FY25 financial and operational performance provides a foundation for improved performance as we move into the second half of the fiscal. Reported Operating Revenues of Rs 3,590 Cr reflect YoY growth of 8% on a like for like basis and core EBITDA and EBITDA margins of 28% and 20% respectively remain healthy. We had a robust performance in the Biosimilars business, up 19% on a like for like revenue basis, driven by strong market share gains in our US Oncology and Insulins franchises. Syngene has returned to sequential growth and has good visibility of a pickup in momentum in the coming quarters led by its Discovery Services and Biomanufacturing CMO business. Generics has continued to face price and demand pressures that have supressed performance, but key new formulation launches in Q3 and Q4 provide the basis of a turnaround before the year end. All three businesses are tracking towards a better performance in the second half of the year, on the back of product approvals and unfolding market opportunities.
“Biocon Biologics’ successful refinancing of its long-term debt of US$ 1.1 billion through a combination an $800 million USD bond listed on the Singapore Stock Exchange and a new $300 million syndicated loan facility was a credible success. This was Biocon Group’s debut bond issue and to be 3x oversubscribed speaks to strong investor confidence in our Biosimilars growth potential.”
— Kiran Mazumdar-Shaw, Chairperson, Biocon Group.
“With like for like Operating Revenue growth of 8%, Biocon Group’s consolidated performance in Q2FY25 was balanced and in line with our expectations. Healthy double-digit growth in Biosimilars more than offset a relatively muted performance in the Generics business and a marginal decline in Syngene’s revenues. Reported Net Loss for the quarter was Rs 16 Cr on account of higher tax, based on geographical split of profits and minority interest. Adjusting for exceptional items, the loss stands at Rs 13 Cr.
“We maintain our outlook for a transition to accelerating growth in the second half of the year with Syngene returning to growth, building momentum in our Biosimilars business and a recovery in Generics in the latter part of H2 driven by the launch of our first GLP-1 generic in the UK. The highly successful Biocon Biologics bond issue was a standout achievement and has significantly strengthened its mid-term financial foundation.”
— Peter Bains, Group CEO, Biocon Limited.
“The Generics business continues to face pricing pressure and demand contraction. This quarter we also carried out a planned shut-down of one of our API facilities, which further impacted revenues. We received a few drug product approvals in the U.S., UK, EU and MoW markets, which will support our near-term sales. The licensing agreements signed with two leading pharmaceutical companies in the Middle East and Brazil, for the commercialization of our GLP-1 products will enable mid and long-term growth in these regions.
“As stated earlier, we expect a transition to growth in the second half of this fiscal on the back of new product launches, including Liraglutide in the UK, as well as other injectable products, such as Micafungin and Daptomycin.”
— Siddharth Mittal, CEO & Managing Director, Biocon Limited.
“The strategic refinancing of our long-term debt through a US$800 million USD bond issuance and a new syndicated loan facility was the highlight this quarter. This provides greater financial liquidity and allows us to re-deploy investments into the business to fuel growth. It is an important milestone for Biocon Group as well as the industry, as it is the first USD bond issuance by any biopharmaceutical company in Asia.
“The business delivered a robust 19% year-on-year growth on a like for like basis, underpinned by an increase in market shares in North America, expansion in Europe, and 15 new launches in Emerging Markets. On the regulatory front, EMA has validated our filing for bDenosumab. We also signed a settlement and license agreement for Yesintek, our bUstekinumab, with the originator that paves the way for launch in Europe, UK, Canada, and Japan.”
— Shreehas Tambe, CEO & Managing Director, Biocon Biologics Limited.
“Syngene’s performance in the second quarter was broadly flat, in line with our expectations, the operating EBITDA margin stood at 27%. We are witnessing early positive signs of recovery in Discovery Services, largely driven by collaborations on pilot projects with large and mid-sized biopharma clients who are looking for alternatives to China. With recent investments in the research and CDMO businesses, we are in a good position to leverage opportunities to drive medium to long-term growth. We remain on track to deliver within our guidance range for the full year.”
— Jonathan Hunt, CEO & Managing Director, Syngene International Limited.
In Rs Crore
–
| Particulars | Q2FY25 | Q2FY24 | YoY (%) |
| INCOME | |||
| Generics | 624 | 676 | (8) |
| Biosimilars^ | 2,182 | 1,969 | 11 |
| Research Services | 891 | 910 | (2) |
| Inter-segment | (107) | (93) | |
| Revenue from Operations | 3,590 | 3,462 | 4 |
| Other Income* | 33 | 158 | (79) |
| Total Revenue | 3,623 | 3,620 | 0% |
| Net R&D Expenses | 200 | 264 | (24) |
| Gross R&D Spend | 200 | 278 | |
| EBITDA | 718 | 900 | (20) |
| EBITDA Margins | 20% | 25% | |
| Core EBITDA** | 992 | 1,100 | (10) |
| Core EBITDA Margins | 28% | 32% | |
| PBT (before exceptional items^) | 72 | 238 | (70) |
| PBT | 98 | 214 | (54) |
| Net Profit (before exceptional items^^) | (13) | 142 | |
| Net Profit*** | (16) | 126 |
Figures above are rounded off to the nearest Crore; % based on absolute numbers.
Notes to financials above:
* Q2 FY24 includes dilution gain in Bicara for ₹75 Crore
**Core EBITDA excludes R&D, Forex, Licensing income, Bicara dilution gain and derivative MTM loss/ gain
^ Exceptional Items – Q2FY25: Inventory provision reversal gain; Q2 FY24 – Pertained to Product Linked Incentive accrual reversal for FY23 consequent to cap on annual claim allocation, and transaction costs on the acquisition of Stelis unit by Syngene
^^ Deferred tax charge on withdrawal of indexation benefit on long term capital asset
*** Reported Net Loss for the Quarter was Rs 16 Cr on account of higher tax based on geographical split of profits and minority interest. Adjusting for exceptional items, the loss stands at Rs 13 Cr.
HR
ESG
Quality & Operational Excellence
Anuj Goel has been appointed as Chief Development Officer. He is a Biocon veteran with over 28 years of experience spanning enzymes, small molecules, insulins and monoclonal antibodies (mABs). Anuj and has been instrumental in building the Company’s R&D capabilities and infrastructure from the ground-up and has a deep understanding of science, regulatory expectations and the business.
Ankur Bhatnagar takes on the role of Global Head, R&D – CMC from Anuj. During his 23 years with the Company, he has held a wide range of technical and leadership roles in R&D. He has played a critical role in securing product approvals for global markets and leading several scientific development initiatives.
Kathleen Blanchard has been appointed as Global General Counsel. She has over 25 years of experience in various Legal, Compliance, and IP roles both as an attorney at marquee law firms in the U.S. as well as in-house counsel at leading global pharma companies. She has a proven track record of leading high performing global teams and being a strategic partner to the business.
Business Performance
During the quarter, the Company obtained approvals in the U.S. for Sacubitril + Valsartan tablets used in the treatment of chronic heart failure, and for Daptomycin for injection to treat bacterial infections. Approvals were also received for Micafungin 50mg an 100mg powder in the UK and EU, for Posaconazole DR tablets in the UAE and for Tacrolimus capsules in India.
The business secured a tender for Everolimus tablets in a MoW market, with supplies expected to commence in Q3FY25. Continuing its regional expansion strategy, the business entered into two new partnerships.
A licensing and supply agreement was signed with Tabuk Pharmaceutical for commercializing its GLP-1 products for both diabetes and chronic weight management in select countries within the Middle East. Biocon will develop and manufacture the products, while Tabuk will hold the marketing authorization rights and be responsible to register, import and promote them in the region.
Subsequently, in October, Biocon entered into an exclusive distribution and supply agreement with a leading speciality pharmaceutical company in Brazil for the commercialization of its vertically integrated drug product, Liraglutide (gVictoza® and gSaxenda®). Biocon will be responsible for regulatory approval, manufacturing and supply of the product, while the partner will commercialize it in Brazil.
Regulatory Inspections
Two separate U.S. FDA surveillance inspections of Biocon’s API facilities in Bengaluru (Sites 1 & 2) concluded in September with a few observations. The Company has submitted individual Corrective and Preventive Action (CAPA) plans to the agency and is confident of addressing these expeditiously. During the quarter, Biocon has received Establishment Inspection Reports (EIRs) for both its API sites in Visakhapatnam (Sites 5 and 6) from the U.S. FDA, following inspections conducted in June 2024.
^After adjusting Q2FY24 revenue for Branded Formulations, India business
##12-month moving annual patient population (October 2023 to September 2024)
Business Performance
Q2FY25
Biocon Biologics’ Q2FY25 revenue at Rs 2,182 crore reported a YoY growth of 19% on a like-for-like basis after adjusting Q2FY24 revenue** for Branded Formulations, India business.
Core EBITDA stood at Rs 691 crore, with Core EBITDA margin at 32%. It reported EBITDA of Rs 469 crore, representing EBITDA margins of 21%. Adjusting for the forex impact of the appreciation of the Japanese yen versus the U.S. dollar, EBITDA was Rs 550 crore with a margin of 25%, reflecting the strong underlying profitability of the core business.
Notes: **Q2FY24 Revenue included Branded Formulations India sales which is not a part of Q2FY25 revenue.
Strategic Refinancing
Biocon Biologics successfully refinanced its long-term debt of US$1.1 billion through a combination of US$800 million U.S. dollar-denominated bonds and a new syndicated loan facility. This strategic re-financing will help improve the Company’s liquidity profile, provide enhanced financial flexibility, strengthen its capital structure and allow it to re-deploy investments into the business to fuel long-term growth. The bonds have been listed on the Singapore Stock Exchange, and it is the first U.S. dollar-denominated bond issuance by any biopharmaceutical company in Asia-Pacific, as well as the largest high yield debut bond issuance from India in the past 10 years.
North America@
Biocon Biologics has positioned itself as a strategic player among customers, payors, and patients in North America.
Its Oncology franchise, comprising Ogivri® (bTrastuzumab) and Fulphila® (bPegfilgrastim), is witnessing robust demand with a marked YoY increase in market share. The market share for Ogivri® increased to 18% from 11%, while Fulphila® rose to 21% from 15% (YoY). Market share for unbranded bGlargine and Semglee® surpassed 15%, which includes share from closed-door pharmacy networks and government business, on the back of a steady demand.
In July, the Company moved into its new North America headquarters in Bridgewater, New Jersey, and marked its first anniversary as an independent commercial organization in the United States and Canada.
Europe@ and JANZ
Biocon Biologics reported steady market shares in Europe at a regional level with Germany and France continuing to drive value. Strong growth across key markets and products has allowed the Company to expand patient access. Hulio® (bAdalimumab) retained its market-leading position in Germany with an 18% market share and 11% in France. The Company has made significant progress in expanding its footprint, with strong market growth in the UK and the Mediterranean cluster, including Italy and Spain.
The Company obtained approvals for bAspart and bEtanercept in New Zealand during the quarter.
@Market shares based on IQVIA Q2 CY2024 data.
The data presented hereunder inter alia volumes, projections, market share, is based solely on our study, interpretation and conclusion derived through analysis of different data sets from varied sources inter alia IQVIA.
The Emerging Markets (EMs) business continues to expand patient reach, securing market leading shares in several key countries such as 74% for bTrastuzumab and 86% for bBevacizumab in South Africa. The Company continues to witness strong demand for its portfolio especially for insulins in Mexico and for bAdalimumab and bEtanercept in Saudi Arabia. Biocon Biologics has also seen an uptick in market shares across its self-led markets, which are a strategic priority for the Company.
During the second quarter, 15 launches of key commercialized products were accomplished across AFMET and LATAM regions such as bBevacizumab and bPegfilgrastim in Saudi Arabia. These new launches will be the key growth drivers, going forward.
The Company received regulatory approvals for five of its products, viz., bBevacizumab, bEtanercept, bAdalimumab, bAspart and rh-Insulin in several countries in the AFMET and LATAM regions.
To strengthen the business further, the Company is working on localization in multiple countries in the AFMET region and exploring new partnerships in the APAC region.
Regulatory Inspections
In terms of facility inspections, the U.S.FDA has classified Biocon Biologics’ Drug Substance facility at Biocon Campus, Bengaluru as Voluntary Action Initiated (VAI). This inspection was held in February 2024 and pertains to the supply of rh-insulin drug substance to the United States.
The Company has submitted a comprehensive Corrective and Preventive Action (CAPA) plan to the U.S. FDA following the cGMP inspection at its insulins manufacturing facility in Malaysia in September 2024. Another CAPA plan has been submitted to the agency related to the inspection of its manufacturing facility at Biocon Park, Bengaluru in July 2024.
The Company is confident of addressing all the observations expeditiously and does not expect the outcome of these inspections to impact the supply of its commercialized products. Furthermore, these sites are cGMP certified by several other leading global regulators including the Europe Medicines Agency (EMA), and Health Canada.
Progress in Pipeline
The European Medicines Agency (EMA) has validated Biocon Biologics’ regulatory filling for bDenosumab and the Company is on track to complete filings in several other markets later this year.
To strengthen its immunology franchise, the Company has signed a settlement and license agreement with Janssen and J&J, clearing the way for the commercialization of Yesintek (bUstekinumab), a proposed biosimilar to Stelara®, in Europe, the UK, Canada, and Japan upon regulatory approval.
Scientific Publications & Presentations
At the European Academy of Dermatology and Venereology (EADV) 2024 Congress in Amsterdam, the Company presented results from two separate pivotal Phase 3 clinical studies in patients with chronic plaque psoriasis supporting interchangeability between biosimilar Adalimumab-fkjp (low concentration) and the Adalimumab reference product (high concentration); and between Bmab 1200 (Yesintek) and the Ustekinumab reference product, establishing bio-equivalence, efficacy and comparable safety.
Biocon Biologics has released a report in collaboration with Clarivate that highlights pathways to increase adoption of biosimilars in low- and middle-income countries (LMICs). A peer-reviewed article based on this study titled “Increasing Adoption of Quality-Assured Biosimilars to Address Access Challenges in Low- and Middle-Income Countries” has been published in the prestigious Generics and Biosimilars Initiative (GaBI) Journal.
Business Performance
Syngene reported positive signs of recovery reflected in the QoQ growth of 13% in revenue. On a YoY basis, Revenue as well as EBITDA were marginally down. Recovery in Discovery Services was largely driven by pilot projects from large and mid-sized biopharma clients seeking alternatives to China. To meet increased demand in the long term, Syngene continues to add to its capacities and capabilities for antibody-drug conjugates, peptides, and oligonucleotides.
Development and Manufacturing Services revenue was led by sustained delivery in biologics manufacturing and an increase in process development projects in small molecules compared to last year. Syngene progressed with repurposing the biologics manufacturing facility acquired in December last year. The facility remains on track to commence operations in the second half of this financial year.
Bicara Therapeutics Inc., a U.S. based clinical-stage biotechnology company in which Biocon has a minority shareholding, successfully closed its initial public offering (IPO) and its shares began trading on the Nasdaq on September 13, 2024, under the ticker symbol “BCAX.” Bicara raised USD 362 million in gross proceeds from its IPO. Biocon’s shareholding in Bicara now stands at 10.7%.
Biocon’s U.S.-based partner Equillium is making progress in developing Itolizumab, the novel molecule licensed from Biocon. In a Phase 3 clinical study for acute graft-versus-host disease (aGVHD), 145 patients have been dosed across 116 active sites in 13 countries. Additionally, enrolment for a Phase 2 clinical trial for Ulcerative Colitis in India has been completed.
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About Biocon Limited:
Biocon Limited, publicly listed in 2004, (BSE code: 532523, NSE Id: BIOCON, ISIN Id: INE376G01013) is an innovation-led global biopharmaceuticals company committed to enhance affordable access to complex therapies for chronic conditions like diabetes, cancer and autoimmune. It has developed and commercialized novel biologics, biosimilars, and complex small molecule APIs in India and several key global markets as well as Generic Formulations in the U.S., Europe & key emerging markets. It also has a pipeline of promising novel assets in immunotherapy under development. Website: www.biocon.com Follow-us on X ( formerly Twitter) @bioconlimited and LinkedIn: @BioconLimited for company updates. For latest Integrated Report of Biocon click here
Biocon Biologics Limited, a subsidiary of Biocon Limited, is a unique, fully integrated, global biosimilars company committed to transforming healthcare and transforming lives. It is capitalizing on its ‘lab to market’ capabilities to serve millions of patients across 120+ countries by enabling affordable access to high quality biosimilars. The Company is leveraging cutting-edge science, innovative tech platforms, global scale manufacturing capabilities and world-class quality systems to lower costs of biological therapeutics while improving healthcare outcomes.
Biocon Biologics has commercialized eight biosimilars in key emerging markets and advanced markets like U.S., Europe, Australia, Canada, and Japan. It has a pipeline of 20 biosimilar assets across diabetology, oncology, immunology, ophthalmology, and other non-communicable diseases. The Company has many ‘firsts’ to its credit in the biosimilars industry. As part of its environmental, social and governance (ESG) commitment, it is advancing the health of patients, people, and the planet to achieve key UN Sustainable Development Goals (SDGs). Website: www.bioconbiologics.com; Follow us on X (formerly Twitter): @BioconBiologics and LinkedIn: Biocon Biologics for company updates. For latest Integrated Report of Biocon Biologics click here
Syngene International Ltd. (BSE: 539268, NSE: SYNGENE, ISIN: INE 398R01022) is an integrated research, development, and manufacturing services company serving the global pharmaceutical, biotechnology, nutrition, animal health, consumer goods, and specialty chemical sectors. Syngene’s more than 5600 scientists offer both skills and the capacity to deliver great science, robust data security, and world class manufacturing, at speed, to improve time-to-market and lower the cost of innovation. With a combination of dedicated research facilities for Amgen, Baxter, and Bristol-Myers Squibb as well as 2.2 Mn sq. ft of specialist discovery, development, and manufacturing facilities, Syngene works with biotech companies pursuing leading-edge science as well as multinationals, including GSK, Zoetis and Merck KGaA. For more details, visit www.syngeneintl.com For the Company’s latest Environmental, Social, and Governance (ESG) report, visit https://esgreport.syngeneintl.com/
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