InvestorQ : When is the IPO of Biocon Biologics planned?
shrinidhi Rajan made post

When is the IPO of Biocon Biologics planned?

12 months ago

Biocon Biologics is the biosimilars unit of Kiran Mazumdar’s Biocon group. The company is planning an IPO in the next 18 to 24 months. However, prior to the IPO, Biocon Biologics will complete the acquisition of the biosimilars business of Viatris Inc. This acquisition will entail a cost of $3.34 billion for Biocon but will help to nearly doble the valuation of Biocon Biologics with the expansion in its top line. IPO will be post this deal completion.

Biosimilars is a huge growth engine for pharma companies and currently Biocon derives most of its value from its biosimilars business. The idea of this acquisition and the subsequent IPO is to leverage the biosimilar opportunity globally. Biocon will be in a position to add tremendous value to its business. Even Kiran Mazumdar expects the biosimilars business to be worth $75 billion over the next 10 years.

The beauty of biosimilars is that there is an opportunity to make it more affordable and India is in a sweet spot to catalyse the change. Also, this is a recent opportunity with more than 60% of the biosimilar approvals in EU happening in the last 4 years only. For Biocon, hiving off the biosimilars business into a standalone profit centre would mean better sum of total parts or SOTP valuation for the company.

For the time being, not much is known about the proposed IPO of Biocon Biologics. Approximately, the expected valuations of the biosimilars business would be in the range of $8 billion to $10 billion. Biosimilars business tends to be richly valued globally. It is in this context that Biocon Biologics would get the full benefit by doing the IPO after buying out Viatris. More clarity on this subject will arise only closer to the IPO date.