Biocon Biologics to Acquire Biosimilars Assets from Viatris in $3.3 Billion Deal

India-based Biocon Biologics Limited (BBL), a subsidiary of Biocon, announced on Feb. 28, 2022 that it has entered into a definitive agreement to acquire the biosimilars business of its partner, Viatris, in a deal valued at approximately $3.34 billion. The board of directors of both companies have approved the transaction, which is expected to close in the second half of 2022, subject to closing conditions.

Under the agreement, Viatris will receive $2 billion on closing and up to $335 million in additional payments, which are expected to be paid in 2024. Upon closing, BBL will issue $1 billion of compulsorily convertible preference shares to Viatris, which is equivalent to an equity stake of at least 12.9% in BBL on a fully diluted basis. The companies will also enter into a transition services agreement under which Viatris will provide certain transition services, including commercialization services, for a two-year period. Viatris also will pay $50 million to BBL to fund certain capital expenditures.

With acquisition, BBL will gain:

• Viatris’ global commercial infrastructure in developed and emerging markets
• Viatris’ global biosimilars business (estimated revenue: $875 million)
• Viatris’ rights in all biosimilars assets, including its in-licensed portfolio and an option to acquire Viatris’ rights in bAflibercept
• Transition services for an expected two-year period

Combining Viatris’ biosimilars business with BBL will accelerate BBL’s build out of its commercial capability in developed markets, including the United States, Europe, Canada, Japan, Australia, and New Zealand.

With a current portfolio of 20 biosimilars, BBL’s acquisition of Viatris’ biosimilars assets will broaden its commercial offerings. The company will have a comprehensive biosimilar insulins portfolio, including rh-Insulin, bGlargine, and bAspart, and will gain a growing biosimilar oncology portfolio, which includes bTrastuzumab, bBevacizumab, and bPegfilgrastim. In addition, BBL will strengthen its presence in the autoimmune disease segment through in-licensed products such as bAdalimumab and bEtanercept. BBL also has access to a vaccines portfolio through a partnership with Serum Institute Life Sciences that was previously announced in September 2021 (1).

Kiran Mazumdar-Shaw will continue as the executive chairperson of BBL, and Viatris will appoint Rajiv Malik, president of Viatris, to serve on the BBL board.

“The deal will enable BBL to attain a robust commercial engine in the developed markets of US and Europe and will fast-track our journey of building a strong global brand. It will also make us future-ready for the next wave of products. This development takes our partnership with Viatris to the next level to realize our shared purpose of impacting global health by providing affordable access to high quality essential and life-saving [b]iosimilar drugs,” said Mazumdar-Shaw in a company press release.

“This deal gives BBL full ownership of Viatris’ rights in biosimilars assets, enabling us to recognize combined revenues and profits,” said Arun Chandavarkar, managing director, BBL, in the press release. “This deal [also] provides several advantages, including strategic agility and operational efficiencies, which will help us mitigate pricing pressures in a competitive global biosimilars landscape. We remain committed to sustainable growth with a strong financial profile, expanded geographical reach, and continued investments in R&D to build a world-leading biosimilars franchise. We believe that as a fully integrated global company, we will be able to enhance patient access and reduce healthcare inequities worldwide.”

Reference

1. Biocon, “Biocon Biologics and Serum Institute Life Sciences Announce Strategic Alliance,” Press Release, Sept. 16, 2021.

Source: Biocon Biologics Limited