Indian pharmaceutical major Biocon has announced acquisition of biosimilar assets of US based Pharma company Viatris in a USD 3.335 Billion deal. As per the information, the deal is going to be all in cash and stocks, which is roughly around INR 25,200 crores. This acquisition is set to be one of the major acquisitions by an Indian pharmaceutical giant, which will eventually improve the overall strength of the company in Biosimilar drug area. The payment period has set to be five years, which is yet in turmoil as equity experts are concerned with tumbling share prices on Indian stock exchange, while investors are tensed about raising more cash for acquisition.
Biosimilar drugs are the drugs that are derived from living organism and work safely as its reference drug. However, to be called as biosimilar drug, the derived product has to be safe, effective and have similar property as reference drug. Thus, by acquiring assets of Viatris, Biocon may gain further strength in Biosimilar sector, which may also help Biocon to extend its overall revenue from this new business. As per the company, Biocon is anticipated to gain more than 1 billion dollars revenue next year from Viatris Biosimilar business. Meanwhile, Viatris will assist in providing transit and other services for further two years in order to sustain smooth flow of customer service.
As per ChemAnalyst, “This new investment of Biocon in Biosimilar drug sector will eventually widen the basket of long-term opportunities for the company. Despite, company is still concerned with actual cash requirement to complete acquisition, profitability may improve in coming years from this segment.”