Biocon Biologics, a subsidiary of the publicly traded biopharmaceutical company Biocon Ltd, stated on Tuesday that it had completed the USD 3 billion acquisition of its partner Viatris’ global biosimilars business. According to the pharma business, Biocon Biologics and Viatris executed the multibillion-dollar, value-accretive deal in part equity and part cash, comprising a USD 2 billion upfront cash payment and the issuing of USD 1 billion Compulsorily Convertible Preference Shares (CCPS).
Both have received the necessary clearances from critical worldwide regulators. It includes the US Federal Trade Commission, the Competition Commission of India, and the Reserve Bank of India, as well as their respective investors. Biocon Limited is a global biopharmaceuticals firm focused on improving access to complex medications for chronic disorders such as diabetes, cancer, and autoimmune.
Biocon Biologics will gain direct commercial capabilities and supporting infrastructure in advanced and emerging markets as a result of this multibillion-dollar acquisition. According to the statement, Biocon Biologics offers a unique portfolio of 20 biosimilar assets, including insulins and monoclonal antibodies, encompassing treatment areas such as diabetes, oncology, immunology, and ophthalmology.
Kiran Mazumdar Shaw’s statement
The completion of Biocon Biologics’ acquisition of Viatris’ worldwide biosimilars company represents a watershed moment in Biocon Biologics’ path to becoming a world-leading, fully integrated biosimilars organization dedicated to meeting patients’ needs for affordable access to vital biomedicines. It will allow us to enter a number of advanced and rising markets directly.
This acquisition builds on our decade-long relationship and will enable us to achieve our goal of addressing global health disparities. This purchase, I believe, will strengthen our value proposition and benefit Biocon and Biocon Biologics shareholders in the long run.
She also stated that Viatris will continue to engage with the teams for up to two years to ensure the seamless continuity of services to patients and consumers. Shaw commended the teams at Biocon Biologics and Viatris for collaborating to meet the regulatory and legislative criteria that allowed the deal to close.
Agreement details
As part of the agreement, Biocon Biologics issued USD 1 billion in Compulsorily Convertible Preference Shares (CCPS) in the company. It represents an equity ownership of at least 12.9% on a fully diluted basis. Further, it made an upfront cash payment of USD 2 billion to Viatris.
Biocon Biologics has received a USD 1.2 billion Sustainability Linked Loan to fund the initial payment (SLL). Biocon Limited contributed USD 650 million in stock, and Serum Institute Life Sciences contributed USD 150 million (SILS).
It received USD 230 million in current reserves and USD 420 million in mezzanine finance. Post-deal conclusion, Biocon is in the process of collecting investments to retire the mezzanine loan. Following the completion of the Viatris and Serum transactions, Biocon Limited’s interest in Biocon Biologics will be 68%.
More about Biocon Company
Biocon Limited is a biopharmaceutical business headquartered in Bangalore, India. Kiran Mazumdar-Shaw created it in 1978. These are sold in over 120 countries, including the United States and Europe. Biocon’s biosimilar products are also available in various emerging markets in both bulk and formulation formats.
Biocon Biologics is the biosimilar subsidiary of Biocon. Biocon and Viatris gained FDA clearance in 2021 to commercialize Semglee. It is an insulin glargine-yfgn injectable that is the first interchangeable biosimilar for diabetes in the US. In 2021, Biocon Biologics sold 15% of the business to the Serum Institute of India for $4.9 billion.
It was in exchange for access to 100 million doses of vaccines per year for the next 15 years. Biocon will also have international commercialization rights to Serum Institute’s vaccine portfolio, which includes the COVID-19 vaccine. Viatris sold its biosimilars division to Biocon Biologies for US$3.335 billion in May 2022.
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