Lupin and Yoshindo’s JV — YL Biologics announces successful outcome of global _=
Phase Ill study for Etanercept biosimilar in Rheumatoid Arthritis . In their board meeting held at Pune last week, YL Biologics (YLB) announced that a global Phase III clinical trial of its investigational Etanercept biosimilar (YLB113) has met with successful outcome. YLB is the joint venture of Pharma major Lupin and Yoshindo in Japan.
“We are excited by the positive results from the Phase III trial. This helps us put together a robust regulatory
dossier intended for global regulatory filings for YLB113. We currently have multiple high value- biosimilar
candidates in our late-stage global development pipeline. We remain committed to advancing our biotech R&D
capabilities so that more patients across the world can access affordable, high-quality biosimilars” said Mr.
Nilesh Gupta, MD of Lupin Limited.
My query to fellow boarders is how long does it take to file the dossier and get regulatory approval since they have completed phase III trial? Also, Nilesh Gupta talks about other biosimilars in the pipeline. Could there be any overlap with Biocon’s product range?
We have at least a five-year head start" in biosimilars compared with other Indian drugmakers, Mazumdar-Shaw
Biocon will need about $1 billion in investment The company is exploring fund-raising options, including selling some of its 73 percent stake in Syngene International, or allowing investors to buy a stake in its biosimilars subsidiary directly through a public offering
The EC approval of Semglee™ applies to all 28 European Union (EU) member states and the European Economic Area (EEA) member states of Norway, Iceland and Liechtenstein.
Personally I don’t track Sun pharma and its biosimilars but it’s tildrakizumab is probably manufacturer by Samsung Biologics and only marketed by Sun pharma
I have invested in Biocon and following all statements of promoters since two and half years and reasonably satisfied with there promises and progress except FDA observations
Recent announcement of collaboration with Sandoz gives investors long term visibilities
Biocons Bangalore facility re inspected by EMA recently, outcome awaited (mins 5.40 attached video).
The Bangalore facility makes the insulin pens. As European commission has granted approval for Semglee disposable pens now, it probably means that the facility has cleared the reinspection. (The original CHMP positive opinion was for Semglee vials alone). Just my biased thought😏
One grey area is still we don’t know what is the profit sharing agreement between biocon and mylan, biocon and sandoz…how do you project the earnings…what is the valuation comfort to enter
Near-term catalysts for Biocon: Approval of biosimilar Neulasta in the U.S. (June 4), biosimilar Humira in EU (2H18), potential launch of biosimilar Herceptin in the U.S. (early 2019 or later as per settlement with Roche), and insulin glargine in E.U. (2H18)
Biocon results are out. Q4 Revenues at 680 crores vs 646 crores Q4 2017. PAT (TCI really) at 69 crores vs 119 crores Q4 2017. YTD EPS at 4.02, PAT at 232 crores, revenues at 2550 crores.
I should say I am disappointed. PAT margins are a dismal 9%. I am not sure how they will reach their 1 billion USD @ 50 Rs/USD target in 2020 - this was supposed to exclude biosimilar business in US and EU. Even if they achieve this at say 15% PAT margins, that gives an EPS of 13.12 per share. If we value this at 20 PE, the biosimilar portfolio is valued at 390 per share 22,330 crores or 3.4 billion USD. With base business showing poor performance and too much expectations on the biosimilar portfolio, the valuation is getting more and more stretched in my opinion.
I am hoping that 2019 will be a good and improving year for Biocon, both in terms of top line and bottom line. Profit margins also should improve. Results are not so good because of depreciation and interest charges. As Malaysian factory utilisation increases profit also will increase significantly.
I am very optimistic about Biocon.
Discl - invested from lower levels and 20% of my portfolio
(Betting big on Biocon, natco, Thyrocare and Dhfl)
A bit complicated for me to express in writing! Bits and pieces of information. This is more for me to refer back in the future.
USFDA
Peg filgrastim USFDA decision on 04 June.
Glargine – decision is pending (don’t know when).
Trastuzumab – because of the Mylan deal with Roche no sales expected for this year (management tight lipped as to why and about the timeline)! This was a huge surprise to me!
EMA (Europe)
trastuzumab and peg-filgrastim – decision pending before the end of this year. Glargine already approved and sales will start from the end of this year (may not be significant - please note)
Few promising trials going through phase II and phase III – oral insulin Aspart
Malaysian facility – depreciation charges significant 48 million dollars/year
Made a loss of 5 million dollars in 2018, break even in 2019 (again very surprised – lots of moving parts according to management)
Debt for this facility – 180 million dollars (reducing I think)
R&D – 380 crores this year. Next year approx. 500 crores (15-16% of sales)
Cash in hand – 1000 crores (enough liquidity)
Net debt is 600 crores (I think – not sure)
EBITDA – 1030 crores for 2018 – this is a better criteria of performance than profit (in view of the significant depreciation and interest expenses)
Outlook – Biologics/biosimilars and syngene will perform well (especially in the emerging markets) but small molecules and formulations will struggle in 2019(the usual reasons – price erosion and competition in US).
2020 onwards will be sweet (hopefully)
My impression – 2019 may not be so good but 2020 onwards looks very promising.
7 fda observations and 6 European observations. The observations are not critical so it is ok to have these observations (not my words this is the import of the company’s filing with the exchange).
Screener informs that an employee has sold 1.3 million shares. This is quite worrying. If the share prices are in the cusp of growth as most of us believe what prompts an employee to sell at 84.5 crores INR?
I am actually getting an uneasy feeling with Biocon for last few months. The promise is out there - been out there for many quarters now - but no visible real improvement. Last time they failed to inform about European inspection and when they finally got the GMP , it was assumed that from now on, they would not have issues with the quality part at least …
I may be totally wrong, but this seems to be a case of great intent, great strategy but rather poor execution … consistently !
DIS: Holding from lower levels … thinking of at least partial exit.
Here’s a Nirmal Bang report that appears to be quite pessimistic.
However, I’m intrigued by the quality of data (unless I’m reading it wrong) - On page 1, “Net revenue” is 10579 for 4QFY18 growing 2.8% YTY and 9% QTQ. On, page 3, the “reported revenue” is 11700 . Even if there’s some GST et al in between, the YTY and QTQ growth changes to 18 and 14% respectively!
And they seem to have a sell rating for last 2 years without that rating being realized.
I’ve been trying to look for the FDA 483 document, but been unsuccessful so far, does anyone have a copy of the 483 ? Additionally, looks like the June 4th TAD won’t materialize. According to most analysts, the FDA would be unlikely to give approval until all 483 issues have been resolved.
