Biocon Biologics concludes acquisition of Viatris’ biosimilars business for US$3bn

INDIA — Biosimilars manufacturing arm of Biocon Ltd, Biocon Biologics, has completed the acquisition of Viatris’ global biosimilars business for US$3 billion.

As per the statement issued by the parent pharmaceuticals company, Biocon Ltd, the multi-billion-dollar acquisition was completed in part equity and part cash.

Biocon Biologics paid an upfront cash of US$2 billion and issued compulsorily convertible preference shares (CCPS) worth US$1 billion.

The acquisition deal has received all its approvals from critical global regulators like the US Federal Trade Commission, the Competition Commission of India and the Reserve Bank of India, and its investors, respectively.

In February, the companies signed a definitive agreement for the acquisition, which would aid Biocon Biologics in establishing a completely integrated international biosimilars enterprise, with eight products currently in the market.

Biocon is a globally recognized name in the pharmaceutical manufacturing industry. It manufactures medicines and other pharma products utilized in the treatment of chronic conditions like diabetes, cancer, and autoimmune.

The Viatris acquisition is seen as an expansion of Biocon Biologics and will help the company in enhancing its commercial capabilities supporting infrastructure.

Currently, the company produces 20 biosimilar assets including insulins and others associated with monoclonal antibodies spanning therapy areas such as diabetes, oncology, immunology, and ophthalmology, the statement added.

Viatris will continue to work with the teams and on its existing projects for two years to avoid disruptions in the company operations.

Biocon Biologics has issued Compulsorily Convertible Preference Shares (CCPS) in the company worth US$1 billion, equivalent to an equity stake of at least 12.9 percent on a fully diluted basis. It received an upfront cash payment of US$2 billion to Viatris.

With the completion of this transaction, Biocon Limited will become the owner of 68% stakes in Biocon Biologics.

Biocon Biologics streamlined the funds from its US$1.2 billion Sustainability Linked Loan (SLL) into the payment.

The remaining payment was made through an equity infusion of US$650 million by Biocon Limited and US$150 million by Serum Institute Life Sciences (SILS).

Biocon Limited funding consists of US$230 million from existing reserves and the balance of US$420 million through mezzanine financing.

The company is attempting to secure other investments to retire the mezzanine financing, post-deal closure.

Biocon Biologics executive chairperson Kiran Mazumdar-Shaw said: “The completion of the acquisition of Viatris’ global biosimilars business is a historic inflection point in Biocon Biologics’ journey of becoming a world-leading, fully integrated biosimilars enterprise, committed to serving patients’ needs for affordable access to essential biomedicines.“