Biocon to invest $161 million in Malaysian unit

Biotechnology company Biocon plans to invest $161 million (Rs 725 crore) in Malaysia by 2014 to establish a biomanufacturing and research and development unit to manufacture high-end biosimilars and biopharmaceuticals.

The Bangalore-headquartered company today signed an agreement with Malaysian Biotechnology Corporation, an agency for the biotechnology industry in Malaysia, for the project. The unit will be set up in Bio-Xcell , a biotechnology park and ecosystem in Iskander Malaysia, Johor.

The total investment of $161 million will be part-funded from the proceeds of the Pfizer marketing deal, along with our internal accruals, Kiran Mazumdar-Shaw, chairman of Biocon, said. She, however, declined to give the specifics of the funding pattern for this upcoming facility.

US-based Pfizer recently tied up with Biocon to market the latter’s four biosimilar products in the insulin space — Recombinant Human Insulin, Glargine, Aspart and Lispro — in the global market.

According to the agreement, Biocon will receive $200 million (about Rs 900 crore) upfront and additional development and regulatory milestone payments of up to $150 million (about Rs 675 crore) from Pfizer.

Shaw said the new Malaysian facility would manufacture biosimilars, including those four insulin analogues for which marketing deal had been signed with Pfizer.

She said they had no plan to enter other Southeast Asian nations in the near future. According to industry experts, the deal carries significance, as Biocon has retained co-exclusive marketing rights with Pfizer for Malaysia, along with India and Germany.

The company said $161 million was part of its first-phase investment plan and it would invest more after 2014.