Biocon Group's Generics Business Struggles Despite Investment, CEO Optimistic About Future

In an exclusive interview with Financial Express, Biocon Group CEO Peter Bains expressed optimism about the company's future despite facing challenges in its generics business. The group reported a 8% year-on-year growth in revenue from operations for the July-September quarter, driven by strong double-digit growth in Biosimilars, which more than offset the decline in the generics business.

However, generics revenue dropped 8% YoY to Rs 624 crore, mainly due to continued pricing pressure and demand contraction in the base business. The company also reported a marginal decline in Syngene's revenues.

In contrast, Biocon Biologics witnessed strong market share gains in its US oncology and insulin franchises, as well as expansion in Europe and emerging markets. This growth was driven by significant improvements in market share for Pegfilgrastim and Trastuzumab in the US.

To mitigate its debt burden, Biocon Group has initiated a restructuring process through a combination of $800 million dollar-denominated bonds and a new syndicated loan facility of $300 million with better terms. The company plans to further reduce debt, having reduced $250 million in acquisition debt last fiscal year.

Peter Bains is optimistic about the company's transition to accelerating growth in the second half of the fiscal year. He cited strong business trends across Biocon Group's three verticals and mentioned that Syngene has good visibility for a pickup in momentum in the coming quarters. Furthermore, Biocon Biologics is poised to launch generic Liraglutide, which comes off patent in November in the UK.

Bains expressed his confidence in Biocon's ability to overcome current challenges and achieve accelerated growth in the second half of the fiscal year, driven by strategic investments in GLP-related API and formulation capabilities.