Biocon Biologics has acquired its partner Viatris’ biosimilars assets. The transaction is part of an effort to create a global, vertically-integrated biosimilars leader.
Biocon Biologics Limited has acquired its partner Viatris’ biosimilars assets. The transaction is part of an effort to create a global, vertically-integrated biosimilars leader.
The board of directors of both companies approved this transaction, in which Viatris will receive consideration of up to $3.335 billion, including cash up to $2.335 billion and Compulsorily Convertible Preference Shares in Biocon valued at $1 billion. Biocon stands to gain Viatris’ global biosimilars business, whose revenues are estimated to be $1 billion next year alongside its portfolios of in-licensed biosimilar assets.
Viatris currently boasts a portfolio of biosimilars for conditions relating to diabetes and metabolism, immunology and oncology, with approximately 150 marketing authorizations. Biocon will now have a comprehensive portfolio of a variety of commercialized therapeutics, including insulins and oncology and immunology biosimilars.
“This acquisition is transformational and will create a unique fully integrated, world-leading biosimilars enterprise,” said Kiran Mazumdar-Shaw, executive chairperson of Biocon Biologics in a press release. “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 Biosimilar drugs.”
The companies state several advantages for this deal. This includes strategic agility and operational efficiencies, which would help to mitigate pricing pressures, attain a robust commercial engine in U.S. and European markets and fast track its journey to becoming a strong global brand.
Biosimilars are biological products that are highly similar to and have no clinical, meaningful difference from an existing Food and Drug Administration (FDA) approved reference product. Essentially, they represent near copies of existing biologic drugs that are used to treat a variety of conditions, including cancer and autoimmune diseases. Biosimilars were introduced in an effort to increase competition, reduce prices and improve patient access to important treatments.
Biocon’s move may have something to do with the growing popularity of biosimilars. In 2020, the global biosimilars market size reached $13.2 billion with an expected growth rate of 17.5% by 2030. The rise of biosimilars also stands to save patients a staggering $100 billion over the next five years. As of this year, the FDA has approved 34 biosimilars intended for the treatment of a variety of conditions, including rheumatoid arthritis, Crohn’s Disease and non-Hodgkin’s Lymphoma.
Patients worldwide only stand to benefit from an increased biosimilars market. The American Journal of Managed Care’s Biosimilars Center reports that 25% of cancer patients were able to access treatment when utilizing biosimilars, and there was an average $200 cost savings per treatment for patients.
Through collaboration, Viatris and Biocon netted a historic FDA approval for the first interchangeable biosimilar Semglee (long-acting insulin glargine) injection for the treatment of diabetes. The fact that it is interchangeable means that pharmacists can make the decision to substitute Semglee for its reference product, Lantus, which can save patients money by a magnitude of 15-35%. Access to affordable insulin has been a major topic in the U.S. as the cost of the life-saving treatment has nearly tripled in the past 15 years.
