Biocon announces Q3FY23 results

Biosimilars Up 54 per cent; Research services up 23 per cent; Generics up 18 per cent

Biocon has announced its consolidated financial results for the third quarter ended December 31, 2022.

Kiran Mazumdar-Shaw, Executive Chairperson, Biocon and Biocon Biologics said,  “Q3 FY23 has been an eventful quarter which saw the completion of the global acquisition of our partnered Biosimilars business from Viatris on Nov 29, 2022. We are now implementing country-wise integration of the business to maximize the value of the combined entity to propel growth. Biosimilars as a business segment offers differentiated growth to Biocon Biologics based on vertical integration and a unique portfolio of Insulins and antibody based immunotherapeutics. This quarter captures a fraction of the acquired business, but from Q4FY23 onwards, the financials will recognise the entire Biosimilars business.

“Biocon’s consolidated revenues for the quarter grew 36 per cent to Rs 3,020 crore on the back of robust performance across all its three businesses. The biggest contribution came from the Biosimilars business, which reported a 54 per cent increase in revenues to Rs 1,507 crore. Research Services revenues at Rs 786 crore and Generics business revenues at Rs 718 crore, grew 23 per cent and 18 per cent, respectively. The advancement of our research pipeline led to Rs 337 crore Net R&D investments this quarter, which will drive Biocon’s future growth. We reported a strong EBITDA growth of 35 per cent to Rs 723 crore, representing a healthy EBITDA margin of 24 per cent. Core EBITDA grew 49 per cent to Rs 1,069 crore.  As a part of our strategy to reduce the acquisition debt, Biocon has raised funds through a partial divestment of its stake in Syngene.

“We expect to end FY23 on a strong note with healthy growth across businesses. Biocon Biologics is tracking towards exiting the year at a USD 1 billion trajectory, excluding vaccines.”

Siddharth Mittal, CEO & Managing Director, Biocon said, “The Generics business’ third-quarter results were in line with our expectations, delivering healthy sequential and year-on-year revenue growth. The performance was driven by immunosuppressant API sales and Generic Formulations, which saw an uptick in the sales of statins as well as recent product launches. Margins, compared to the previous year, were muted by the product mix and continuing pricing pressure in the U.S. market.

“Our geographical expansion continued to gain traction with the signing of a partnership agreement with Zentiva for commercialising Liraglutide in Europe, as well as a long-term strategic partnership with Farmanguinhos in Brazil for the supply and tech-transfer of a finished dose formulation immunosuppressant product. These partnerships will contribute towards attaining  mid-teens growth in the short to medium term. We also secured approvals for some of our key formulation products in Europe. Our focus remains on geographical expansion, new product launches, strengthening our product pipeline and executing on key capex projects.”

Shreehas Tambe, CEO & Managing Director, Biocon Biologics added, “Biocon Biologics recorded its highest ever quarterly revenue of Rs 1,507 crore, reflecting a growth of 54 per cent on the back of our acquisition of Viatris’ biosimilars business and continued growth in BBL led markets. This strong performance has translated to an EBITDA growth of 53 per cent to Rs 361 crore. This landmark acquisition marks an  inflection point in our transformational journey and positions Biocon Biologics as a unique, fully integrated, leading global biosimilars enterprise.

“While our biosimilars portfolio continues to gain market share in the U.S. and EU, our business in the Emerging Markets is also on a growth trajectory with product launches in 8 new markets this quarter. We have drawn up a comprehensive plan to integrate the acquired Viatris business into Biocon Biologics and migration of business operations is scheduled in a phased manner to ensure business continuity and uninterrupted service to customers and patients.”

Jonathan Hunt, CEO & Managing Director, Syngene said, “We continue to see good demand in the main client markets of U.S. and Europe which – combined with strong execution and forward planning – has helped us deliver solid revenue growth in the third quarter. We are pleased to report positive performances from all divisions this quarter. Growth in our research divisions, Discovery Services and the Dedicated Centres, was solid. In Development Services, repeat orders from existing clients, as well as an increase in the number of collaborations with emerging biopharma companies drove a robust performance. In Manufacturing, the highlight of the quarter was the successful inspection of our biologics facilities by the U.S. FDA, EMA and MHRA. Based on our strong performance to date, we are confident of meeting the upgraded annual revenue growth guidance of high teens.”