Biocon Biologics to acquire Viatris' biosimilars business for $3.33 bn

New Delhi, February 28

In one of the largest deals in the pharma and healthcare space, Biocon on Monday said its subsidiary Biocon Biologics will acquire Viatris Inc’s biosimilars business for up to $3.33 billion (about Rs 24,990 crore).

Deal dynamics

• Viatris will receive consideration of up to $3.335 billion, including cash up to $2.335 billion and compulsorily convertible preference shares in Biocon Biologics Ltd, valued at $1 billion
• The buyout will help Biocon to have a comprehensive portfolio, comprising its current range of commercialised insulins, oncology and immunology biosimilars and several other biosimilar assets under development

Shares tumble 11%

Shares of Biocon, headed by Kiran Mazumdar-Shaw, on Monday tanked over 11% after it said its subsidiary Biocon Biologics has inked a pact to buy Viatris Inc’s biosimilars business

Viatris will receive consideration of up to $3.335 billion, including cash up to $2.335 billion and compulsorily convertible preference shares (CCPS) in Biocon Biologics Ltd, valued at $1 billion, it added.

Biocon said Viatris will receive cash consideration of $2 billion on the closing of the transaction and up to $335 million as additional payments expected to be paid in 2024.

Additionally, upon closing of the transaction, Biocon Biologics will issue $1 billion of CCPS to Viatris, equivalent to an equity stake of at least 12.9% in the company, on a fully diluted basis.

As part of the deal, Biocon Biologics will gain Viatris’ global biosimilars business whose revenue is estimated to be $1 billion next year, along with its portfolio of in-licensed biosimilar assets.

The acquisition will help the company to have a comprehensive portfolio, comprising its current range of commercialised insulins, oncology and immunology biosimilars and several other biosimilar assets under development.

Biocon Biologics, which currently has a portfolio of 20 biosimilars, will also have access to the vaccine portfolio through its previously announced partnership with Serum Institute Life Sciences (SILS).

The Board of Directors of both the companies have approved the transaction and the deal is expected to close in the second half of the year.

“This strategic combination brings together the complementary capabilities and strengths of both partners and prepares us for the next decade of value creation for all our stakeholders,” Biocon Biologics executive chairperson Kiran Mazumdar-Shaw said.

The deal will enable Biocon Biologics to attain a robust commercial engine in the developed markets of the US and Europe, and fast-track Biocon’s journey of building a strong global brand, she added. —