The Hindu Business Line : Biocon ties up with Mylan of US for biogenerics

“Through this partnership we hope to deliver high quality, affordable biogeneric antibodies and biologics addressing the need to lower spiralling healthcare costs.” – Ms Kiran Mazumdar-Shaw

Our Bureau

Bangalore, June 29

Biocon Ltd on Monday announced an exclusive collaboration with the US-based generic drugs major Mylan Inc to develop, manufacture, supply and commercialise many high-value generic biologic compounds for the global markets.

It did not disclose the financial terms or product details.

“Mylan and Biocon will share development, capital and certain other costs to bring products to market,” Biocon said in a release.

“Mylan will have exclusive commercialisation rights in the US, Canada, Japan, Australia, New Zealand and in the European Union and countries of the European Free Trade Association through a profit-sharing arrangement with Biocon. Mylan will have co-exclusive commercialisation rights with Biocon in all other markets. All other financial terms and product details remain confidential.”

Western markets

The tie-up comes at a time when Biocon has been working towards the regulated Western market; and at a time when the US is pondering a law to allow biogenerics into the market.

The Biocon scrip closed marginally around one per cent higher at Rs 229 a share on the bourses on Monday.

Biogenerics or biosimilars are similar-acting copies of original biologic medicine and can enter the market when the originals go off patent; they are said to cost much less than the innovator drugs.

The Obama Administration wants to reduce the patent period of original biotech drugs from 12 years to 5-7 years to bring in the biosimilars.

The Biocon Chairman and Managing Dirctor, Ms Kiran Mazumdar-Shaw, “Through this partnership we hope to deliver high quality, affordable biogeneric antibodies and biologics, thereby addressing a critical need to lower spiralling healthcare costs in both the developed and emerging economies.”

Mr Robert J. Coury, Chairman and Chief Executive Officer of the $ 5.1-billion Mylan (2008 sales), described the pact as “one of the more comprehensive and high quality biologics initiatives reported within the industry to date.”

Patents

An estimated $25 billion worth of biologics are due to lose patent cover by 2016 and this would create a significant market opportunity for protein or biotech therapeutics, Biocon said.

These include insulin and its analogs, erythropoietin, human growth hormone and monoclonal antibodies or MAbs that are used to treat cancer, rheumatoid arthritis and post-transplant cases and that lead the bio-pack.

(Biocon launched its novel cancer drug BioMAB in 2006.)

The Biocon Chief Operating Officer, Dr Arun Chandavarkar, termed it an important deal for Biocon that involved “a complex formula of risk- and cost sharing that goes beyond the more common licensing” mode for drug molecules.

He told Business Line that though Biocon was working on its own novel drugs in some of these areas, the pact would touch only complex biogenerics required against cancer, auto-immune diseases and rheumatoid arthritis, etc.

The tie-up would involve resource commitment from both sides and cost-sharing on all aspects except for marketing.

“Almost all work would happen at Biocon. It would definitely warrant recruiting specialists with experience in areas like MAbs.” Biocon would have a role at all levels up to the regulatory process; and even co-market the drugs coming out of it in emerging markets. Biocon has already laid an early foundation for the R&D and infrastructure that this agreement requires. Mylan brings in its regulatory and commercialisation capabilities in the US and Europe. “We should be ready when the large US market opens,” he said.

Over the next five years, emerging markets, too, are expected to see biogenerics grow at over 20 per cent a year from the current $1.5 billion. “Biocon is well positioned to capitalise on these opportunities through its early investments in research, development and manufacturing of high quality protein therapeutics for novel biologics and biogenerics.”

Biogenerics is a complex and costly game that allows only a few players into the highly regulated markets of Europe and the US. Ms Mazumdar-Shaw said, “A partner as strong as Mylan will accelerate our work in generic biologics and take it to the next level around the world, especially in regulated markets.”

Mylan owns Hyderabad’s Matrix Labs with a 71.5 per cent stake it acquired for Rs 3,367 crore two years back.