Biocon Ltd.

New Delhi: As biopharma major Biocon Limited decided to shelve its separate listing plans for its biosimilars arm— Biocon Biologics —Group Chair Kiran Mazumdar-Shaw remarked that the market's negative reaction following the Viatris buyout made integration the only possible option to unlock expected value. Speaking to investors over an analyst call, Shaw said that "initially the plan was to consider an IPO but later the response from the market was so negative to such an important acquisition" ( Viatris acquisition in 2022) prompted a strategic reassessment. “Advisers recommended that pursuing an IPO under such conditions would not deliver the anticipated value and the optimal way to unlock the best possible value is by reverting to the original structure, integrating Biocon Biologics as a business division within the company”, she added. Against plans for a merger, Shaw said the integration approach represents the most effective way to unlock value while fully eliminating the old holding-company discount. She added that Biocon has extensive experience in operating wholly-owned subsidiaries compared with pursuing mergers, and that this structure enables the company to manage operations in a clean and transparent manner. According to Shaw, the integration exercise will generate multiple synergies, including supply chain efficiencies, streamline procurement of raw material, besides the commercial focus of advancing launches in new markets and harness the combined strengths of generics and biosimilars businesses across 120 countries Kedar Upadhyay, CFO of Biocon Biologics, added that under the proposed plan, the subsidiary structure will remain unchanged and cash flows, intellectual properties, and the commercial footprint will continue to stay with Biocon Biologics. Commenting on the biosimilars unit’s loan book, Upadhyay said, the company plans to fund it using organic cash generated from its rising $250 million EBITDA. For the patent entity, he added that Biocon has made significant improvements in deleveraging its balance sheet, and its net debt-to-EBITDA ratio has improved from 4.3x in 2020 to 2.5x, and the company expects it to reach around 2x by the next fiscal. Notably, in the ongoing fiscal Biocon has settled its obligations with Kotak and Goldman Sachs and has also initiated further engagements with Edelweiss. Biocon has announced to buyback the biosimilars-arm shares from Serum Institute Life Sciences (Serum), Tata Capital Growth Fund II (Tata Capital) and Activ Pine LLP (Activ Pine). The deal which values Biocon Biologics at $5.5 billion involves a share swap of 70.28 Biocon shares for every 100 Biocon Biologics shares, and the management targets to complete the integration no later than March 31, 2026. To ensure a seamless transition, the company has constituted a Transition and Integration Management Committee, under Shreehas Tambe, CEO and MD, Biocon Biologics. Following the completion of the integration exercise, Tambe will step up as the company's new CEO, while the incumbent head, Siddharth Mittal, will move into a leadership role within the Group. Alongside the buyback plan, Biocon has also announced plans to acquire the remaining stakes in Viatris currently held by Mylan for a total consideration of $815 million, comprising $415 million via a share swap arrangement and the remaining $400 million in cash. The company board has approved a QIP proposal to raise Rs 4,500 crore (around $500 million) to fund the cash component of the deal. QIP proceeds are projected to drive annual interest cost savings of around Rs 300 crore per annum. By Abhijeet Singh ,

Mumbai: Biocon will fully integrate Biocon Biologics as a wholly owned subsidiary in a transaction valuing the biosimilar business at $5.5 billion, as it was the most value-accretive option after “the markets took the Viatris acquisition negatively,” executive chairperson Kiran Mazumdar-Shaw told ET on Saturday. In an interview with Rica Bhattacharyya and Vikas Dandekar, Shaw detailed how the merger removes the holdco overhang, strengthens financial metrics, and provides timely exits for investors such as True North, Tata Capital and Viatris . She also outlined how the combined entity—unique for its interchangeable biosimilar insulins and generic GLP-1 peptides —will unlock synergies across manufacturing, R&D, devices and commercial footprints. ET was the first to report on November 13 that Biocon had appointed Morgan Stanley to evaluate the best value-creation option, including a merger and share swap. Allowing more cash flow The Biocon board has approved raising additional capital of up to ₹4,500 crore ($500 million) through a qualified institutional placement (QIP), which will be largely utilised towards the cash component payable to Viatris, whose global biosimilars business was acquired by Biocon Biologics in 2022. Edited excerpts of the interview: What was the rationale behind the share swap decision, because you were considering other options like an IPO as well? We had earlier expected to take BBL to an IPO because we thought that was the best way of giving an exit to the investors. But the markets took the Viatris acquisition negatively and hammered Biocon’s valuation because of the acquisition debt. We had to also look at a holdco discount. The combination of the two factors completely devalued Biocon’s shares. That, by extension, also affected BBL’s intrinsic value. So, we asked the question that even if we take BBL public, will it result in value unlocking? Then we appointed Morgan Stanley to evaluate all options—IPO, merger, share swap—and decided to buy out the independent stakeholders in Biologics and do a share swap. That automatically makes BBL a wholly owned subsidiary of Biocon and then it becomes a combined business. That way, we will get rid of the holdco discount, be able to see a very robust financial balance sheet, and the whole metrics change—the debt-to-Ebitda ratio has dropped from 4.3 in 2020 to 2.5 today and we are expected to go down even further next fiscal. It puts us in a very strong position, allowing free cash flow. We have also retired the structural equity debt of Kotak and Goldman Sachs and others, which will free up another ₹300 crore of provisioning interest. The governance council and integration management committee have been announced. What are the immediate top three priorities for these bodies over the next 90 days? First is to find out how the new organisation looks. Although it is a very complementary fit, they are also very different, because the manufacturing of small molecules is very different from manufacturing of biologics. But divisions like logistics, IT and some others do not need duplication. We will first look at the organisation structure and how to fit in some people. We will want to accommodate everyone—their roles will not change, but the organisation structure will change a bit. At the top level, we cannot have two CEOs and that’s why we decided that Shreehas Tambe will take over as CEO and MD because he is running the more complex and larger business. But Siddharth Mittal, the current Biocon CEO, is a great leader and we will find a good leadership role for him in the company. If not for the investor pressure and the market's concern about acquisition debt, would you still combine the two businesses? It is not for the investor pressure. We had to find an exit for our investors in Biologics. It was not about Biocon but about our equity investors in Biologics. We had Serum, Tata Capital , True North and Viatris. All of them had to be provided an exit at some stage. Serum had no option but to wait because they had no clause on a specified date. But as far as Viatris was concerned, we had a date of 2030, and for True North and Tata Capital it was 2026. So, there was an urgency in taking this decision—either we had to buy them out or give them an exit. We thought let’s look at a liquidity event that addresses all this. Everyone has benefitted from this merger. Viatris has got a five-year accelerated liquidity event. True North and Tata Capital got what they wanted because they were invested at a certain level, and we actually got a valuation of $5.5-billion swap ratio. If we had gone for an IPO, the debt overhang would probably have reduced the value. Given all that, this is the best option. What are the major benefits from this integration? The combined entity is positioned strongly as a unified global player across both biosimilars and generics, but at the same time both are very different businesses… The fact that we are looking at an Ebitda improvement ratio tells us that there will be good contributions from synergies as well. In three months, we will know what those quantifiable benefits are. We are now focused on the combined business. Overall, we expect strong growth, especially in biosimilars. With the new launches we have had, we expect robust performance. We also have a unique value proposition because we are the only company globally that has biosimilar interchangeable insulins and a portfolio of generic GLP-1s. This puts us in a very strong position because we have end-to-end capabilities. Whether it is manufacturing drug substances, drug products or devices, everything is internal and integrated. We do not have to outsource, and we have scale—something many companies lack. Does the integration accelerate Biocon’s approach to launches in major markets like the US, Europe and Japan? It will certainly accelerate our approach to launches, especially in markets like the US. We are very mature in our commercial footprint when it comes to biosimilars, which is the most complex business. Even in emerging markets, BBL has its own presence in many key regions where Biocon earlier relied on partners. From that perspective, controlling the business in key markets is very attractive. A combined portfolio of biosimilars and generics is also extremely useful. We can accelerate launches, grow the business and derive tremendous synergies. The two businesses are highly complementary. By Vikas Dandekar & Rica Bhattacharyya ,

Viatris to Receive $400 Million in Cash and $415 Million in Equity Shares of Biocon Limited Transaction Accelerates the Expiration of Biosimilars Non-Compete Restrictions PITTSBURGH, Dec. 6, 2025 /PRNewswire/ -- Viatris Inc. (Nasdaq: VTRS) today announced that it has entered into definitive agreements with Biocon Limited ("Biocon") for the sale of Viatris' equity stake in Biocon Biologics Limited ("Biocon Biologics"). Under the definitive agreements, Biocon will acquire all of Viatris' convertible preferred equity in Biocon Biologics for total consideration of $815 million, consisting of $400 million in cash and $415 million in newly issued equity shares of Biocon. "This agreement is another important step in Viatris' evolution," said Scott A. Smith , Chief Executive Officer, Viatris. "Monetizing the value of our equity stake in Biocon Biologics and regaining access to the biosimilars market globally provides significant additional optionality as we continue to build a portfolio of generics, established brands and innovative brands that can contribute to our future growth." Key Terms of Transaction Under the terms of the agreements, Viatris will sell its equity stake in Biocon Biologics to Biocon for $400 million in cash and $415 million in equity shares of Biocon Limited, which will be listed and traded on the National Stock Exchange of India. The shares are subject to a six-month lock up period. Transaction value will be subject to related taxes. In addition, the terms of the definitive agreements accelerate the expiration of biosimilars non-compete restrictions previously placed on Viatris in 2022 in connection with Viatris' sale of its biosimilars portfolio and related commercial and other capabilities to Biocon Biologics. These restrictions will expire immediately at the time of close for all ex-U.S. markets and in November 2026 for U.S. markets. The transaction is expected to close in Q1 2026, subject to satisfaction of closing conditions. Citi is acting as financial advisor to Viatris. Cravath, Swaine & Moore LLP and Indian law firm Khaitan & Co. are acting as legal advisors to Viatris. About Viatris Viatris Inc. (Nasdaq: VTRS) is a global healthcare company uniquely positioned to bridge the traditional divide between generics and brands, combining the best of both to more holistically address healthcare needs globally. With a mission to empower people worldwide to live healthier at every stage of life, we provide access at scale, currently supplying high-quality medicines to approximately 1 billion patients around the world annually and touching all of life's moments, from birth to the end of life, acute conditions to chronic diseases. With our exceptionally extensive and diverse portfolio of medicines, a one-of-a-kind global supply chain designed to reach more people when and where they need them, and the scientific expertise to address some of the world's most enduring health challenges, access takes on deep meaning at Viatris. We are headquartered in the U.S., with global centers in Pittsburgh, Shanghai and Hyderabad, India. Learn more at viatris.com and investor.viatris.com, and connect with us on LinkedIn, Instagram, YouTube and X. Forward-Looking Statements This press release includes statements that constitute "forward-looking statements." These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements may include statements that Viatris has entered into definitive agreements with Biocon for the sale of Viatris' equity stake in Biocon Biologics; under the definitive agreements, Biocon will acquire all of Viatris' convertible preferred equity in Biocon Biologics for total consideration of $815 million, consisting of $400 million in cash and $415 million in newly issued equity shares of Biocon; this agreement is another important step in Viatris' evolution; monetizing the value of our equity stake in Biocon Biologics and regaining access to the biosimilars market globally provides significant additional optionality as we continue to build a portfolio of generics, established brands and innovative brands that can contribute to our future growth; under the terms of the agreements, Viatris will sell its equity stake in Biocon Biologics to Biocon for $400 million in cash and $415 million in equity shares of Biocon Limited, which will be listed and traded on the National Stock Exchange of India; the shares are subject to a six-month lock up period; transaction value will be subject to related taxes; the terms of the definitive agreements accelerate the expiration of biosimilars non-compete restrictions previously placed on Viatris in 2022 in connection with Viatris' sale of its biosimilars portfolio and related commercial and other capabilities to Biocon Biologics; these restrictions will expire immediately at the time of close for all ex-U.S. markets and in November 2026 for U.S. markets; the transaction is expected to close in Q1 2026, subject to satisfaction of closing conditions. Because forward-looking statements inherently involve risks and uncertainties, actual future results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to: actions and decisions of healthcare and pharmaceutical regulators; our ability to comply with applicable laws and regulations; changes in healthcare and pharmaceutical laws and regulations in the U.S. and abroad; any regulatory, legal or other impediments to Viatris' ability to bring new products to market; products in development and/or that receive regulatory approval may not achieve expected levels of market acceptance, efficacy or safety; longer review, response and approval times as a result of evolving regulatory priorities and reductions in personnel at health agencies; Viatris' or its partners' ability to develop, manufacture, and commercialize products; the scope, timing and outcome of any ongoing legal proceedings, and the impact of any such proceedings on Viatris; Viatris' failure to achieve expected or targeted future financial and operating performance and results; goodwill or impairment charges or other losses; any changes in or difficulties with the Company's manufacturing facilities; risks associated with international operations; changes in third-party relationships; the effect of any changes in Viatris' or its partners' customer and supplier relationships and customer purchasing patterns; the impacts of competition; changes in the economic and financial conditions of Viatris or its partners; uncertainties regarding future demand, pricing and reimbursement for the Company's products; uncertainties and matters beyond the control of management, including but not limited to general political and economic conditions, potential adverse impacts from future tariffs and trade restrictions, inflation rates and global exchange rates; and the other risks described in Viatris' filings with the Securities and Exchange Commission ("SEC"). Viatris routinely uses its website as a means of disclosing material information to the public in a broad, non-exclusionary manner for purposes of the SEC's Regulation Fair Disclosure (Reg FD). Viatris undertakes no obligation to update these statements for revisions or changes after the date of this press release other than as required by law. SOURCE Viatris Inc. 21% more press release views with Request a Demo