Biocon - The ultimate biosimilars play!


#103

(aashish2137) #104

Can somebody help me understand how is Biocon exposed to US markets and Trump’s expected policy changes?


#105

Take it easy. At best some tweaks. Biocon does not have much US exposure currently.


(vivek naik) #106

although biocon has no exposure to us markets,one of the demands of Trumps supporters was to completely scrap obamacare, .so lets see what happens,things will be clear once he takes office


(ashit) #108

Management interview

Thanks
Ashit


(sharrmasks) #109

http://corporates.bseindia.com/xml-data/corpfiling/AttachLive/703E6D9D_7DA6_4C47_A8D5_FBD120EBFFA8_183157.pdf

Biocon’s application for trastuzumab accepted by USFDA. Another important milestone in the long journey of biocon. The press release says mylan has exclusive marketing right for USA,EU,Japan, Australia,Newzelend, Canada while biocon has it for the rest of the world. In what proportion the revenue or profits from us market wiill be shared between the two company.? @rks00


(Rohit) #110

Hi Sharrmasks, Thanks for sharing the link.
The profit sharing between these companies is kept extremely confidential for competitive reasons & therefore it is virtually impossible to figure this out. The important aspect is no more additional capital will need to be put up by Biocon in so far as Trastuzumab in the US is concerned, the marketing, filing, lawsuits (if any) would be taken care of by Mylan. This drug addresses the second most common form of cancer and is a $30Bn market worldwide, with the US & EU comprising nearly $20Bn.

In the following article (link - http://finance.yahoo.com/news/u-fda-accepts-biologics-license-130000077.html )
there is mention of a goal date of September 2017. I tried researching what this means but still unsure. Does this mean that this filing under the 351 (k) will get an outcome of approval by Sept 2017? Any insights on this?

Thanks


(Rohit) #111

18 months is the approval time frame for Trastuzumab per KMS and not the Sept goal date I had misinterpreted earlier.
Link - http://www.moneycontrol.com/news/business/i-dont-see-trumps-views-affecting-indian-drug-cos-biocon-cmd_8252241.html


(ashit) #112

Too Late? Biocon And Mylan’s $7 Billion Bet

Roche is however, testing a combination drug - trastuzumab and pertezumab - which may be more effective than Herceptin alone for breast cancer .

The new drug would limit the market for Biocon - Mylan’s biosimilar trastuzumab in the US.

Thanks
Ashit


#113

This is standard practice by innovator companies to retain dominant market share in face of competition from generics.


(Tarun) #114

Its common practice that innovator don’t want to loose ground, more so when market size is ~7 billion USD.

Another example where Biocon is betting big is Pegfilgrastim. Here Amgen and Apotex locking horns big time in legal battle. Amgen also improvising doses strength etc.


(Rohit) #115

Ashit,

Thanks for bringing this up. You’re right, the pathway for Biocon & Mylan is murkier than initially conceived. On the bright side they will get F2F and may enjoy the market place for themselves for a short period of time maybe a year or so as competition is still in the testing phase (Talking about both the Aphinity trials of Roche & other bio-similar competitors) as far as Trastuzumab is concerned.

The way I look at this - It doesn’t change my investment thesis primarily for the following reason (could be biased as this is among my largest holding) - Biocon to me is classic low risk, high uncertainty play. There is high uncertainty about the outcomes of their bio-similar forays but the point is I don’t know if the market is pricing in Biocon’s pipeline (after you back out syngene) unlike Shilpa & Natco, It is impossible to say what the market is pricing in or not so don’t want to get into that, but I think Biocon’s guidance of reaching their $1bn guidance (Inr/USD 50 assumption) by 2018 is still very much on the cards (the guidance assumes no US/ Euro sales) and that should help support the stock. So I’m pretty optimistic and holding on tight. Looking forward to their results in a few days.

Again just my view could be totally wrong, thanks again for bringing this up, it really helps make me dig deeper and stay on top of things. Appreciate it.


(csteja) #116

I share the same opinion.

DISC: Invested


(Rohit) #117

Great set of numbers, for those that missed it - http://www.biocon.com/docs/Biocon_results.pdf

Standalone - Net income up 63% YoY
Consol - Net Income up 60%

Top line (both SA and consol) up approx 30%

key take away for me - significant improvement in margins esp small molecules & biologics business. Looks like their project on optimizing mix is bearing fruit.
Malaysia facility commercial production commenced.
Awaiting the con call!


#118

Great numbers. Enjoy the ride. There will be ups and downs but definitely worth holding for at least next 5 years.


(ashit) #119

https://www.google.co.in/amp/s/www.yahoo.com/amphtml/finance/news/edited-transcript-biocon-nse-earnings-193129511.html

Biocon transcript
This statement from KMS sum up all future prospects for company

See, I think basically Biocon has clearly articulated its business strategy by saying that we want to be leaders in biosimilars and therefore we are creating a very robust pipeline on which we are delivering. I think the fact that we have been potentially the first to file in terms of our Trastuzumab biosimilar in the US and the fact that the target date has been provided by US FDA later this year is a very important signal that we are actually in a position to deliver very high quality products to the developing world. And I think this is a very, very important signal because up until now I think there was a lot of concern about whether a company like Biocon can indeed address these very, very large and lucrative market opportunities in Biosimilars and the answer is yes.

I think you will also see from the JAMA publication that they have actually validated Biocon’s ability to develop such products. So, I think you have to look at it very positively from that point of view. You also know that globally it is accepted that the next bolus of growth in terms of the pharmaceutical area is going to come from biosimilars. And I think you can clearly see that Biocon is amongst the front runners and we clearly see that Biocon and Mylan are in a very strong position to address these very large opportunities because of the fact that we believe we have a very strong cost competitiveness and we have basically invested in this at the right time. So, I think you have to look at it in that context.

And going forward obviously we are going to invest very strongly in a growing pipeline of biosimilars and we want to be very, very strong in this segment. Now you can also see that Biocon is very unique because we are the only company that actually have [started] both insulins and the biologics. So, I think again this puts us into a very prime position in making ourselves very, very strong and large in this whole context of biosimilars. And then Biocon has also been very prudent in investing in some very important novel biologics and we believe that the next few years will also show you that we will build credibility in these novel biologics as well. So, I think it’s a very, very exciting opportunity for Biocon and for investors to invest in such a unique growth story.

Thanks
Ashit


(ashit) #120

USFDA accepts Mylan-Biocon’s second biosimilar pegfilgrastim for review
The FDA goal date set under the Biosimilar User Fee Act (BsUFA) is October 9, 2017,
Thanks


(Rohit) #122

Potential commercial launch date of the first wave of Bio similars in the US could be late FY 18 (optimistic) or FY 19 (Base case)
An approval in and of itself will be massive, although we need to keep an eye out for updates & new precedents on the “patent dance” and potential lawsuits post approval.


(ashit) #123

BofA-Merrill Lynch research report .

Interchangeability switch studies make sense for chronic diseases Management was of the view that switching studies for interchangeability make sense only for chronic drugs such as Humira, Lantus and not acute drugs. Initial focus of BIOS will be to market non-interchangeable biosimilars in US/EU.

Thanks


(ashit) #124

Two vary important inspections coming up later this month and in early April from European medicines agency (EMA) and US FDA

Thanks