Biocon Biologics completes acquisition of Viatris' global biosimilars biz

Biocon on Tuesday said its unit Biocon Biologics has completed the multi-billion dollar acquisition of the global biosimilars business of its partner Viatris Inc.

In February this year, Biocon Biologics inked a pact to acquire Viatris Inc's biosimilars business for consideration of up to USD 3.33 billion (about Rs 24,990 crore).

Biocon Biologics and Viatris have obtained all applicable approvals from key global regulators, including the US Federal Trade Commission, the Competition Commission of India and the Reserve Bank of India, and its investors, the Bengaluru-based company said in a statement.

Effective from the date of closing, Biocon Biologics will recognise the combined revenue and associated profits from the acquired products, a step up from the existing profit share arrangement, it added.

As a part of completing the transaction, Biocon Biologics has issued Compulsorily Convertible Preference Shares (CCPS) valued at USD 1 billion, equivalent to an equity stake of at least 12.9 per cent on a fully diluted basis, and made an upfront cash payment of USD 2 billion to Viatris.

To fund the upfront payment, Biocon Biologics has secured USD 1.2 billion of Sustainability Linked Loan (SLL).

The balance has been funded through an equity infusion of USD 650 million by Biocon Ltd and USD 150 million by Serum Institute Life Sciences (SILS).

Biocon's funding comprises USD 230 million from existing reserves and USD 420 million through mezzanine financing.

Post the conclusion of the Viatris and Serum transactions, Biocon's stake in Biocon Biologics will be 68 per cent.

"It will fast-track our direct entry into several advanced and emerging markets. This acquisition builds on our decade-long partnership and will enable us to realise our vision of addressing global health inequities," Biocon Biologics Executive Chairperson Kiran Mazumdar-Shaw said.

With the closing of the deal, Biocon Biologics has full ownership of its collaboration assets, bTrastuzumab, bPegfilgrastim, bBevacizumab, bGlargine, bAspart, bPertuzumab, and bGlargine 300U, as well as Viatris' rights for the in-licensed immunology products of bAdalimumab and bEtanercept.

Biocon Biologics has also acquired Viatris' rights for bAflibercept, which is used to treat several ophthalmology conditions.

As part of the arrangement, Viatris President Rajiv Malik has joined the board of Biocon Biologics effective from Tuesday.

Kiran Mazumdar-Shaw will continue as the Executive Chairperson of Biocon Biologics.