Biocon Biologics to Acquire Viatris’ Biosimilars Assets for up to USD 3.335 billion in Stock and Cash
Biznextindia : Biocon Biologics Ltd., a subsidiary of Biocon Ltd. has announced that it has entered into a definitive agreement with its partner Viatris Inc. (NASDAQ: VTRS). Accordingly, Biocon Biologics Ltd. (BBL) will acquire Viatris’ biosimilars business to create a unique fully integrated global biosimilars enterprise. Viatris will receive consideration of up to USD 3.335 billion, including cash up to USD 2.335 billion and Compulsorily Convertible Preference Shares (CCPS) in BBL, valued at USD 1 billion.
The Board of Directors of both companies have approved the transaction. BBL will have a comprehensive portfolio comprising its current range of commercialized insulins, oncology and immunology biosimilars as well as several other biosimilar assets currently under development. BBL also has access to the vaccines portfolio through its previously announced partnership with Serum Institute Life Sciences (SILS).
“This acquisition is transformational and will create a unique fully integrated, world leading biosimilars enterprise. Our long-standing global partnership with Viatris has enabled us to achieve many firsts, setting new benchmarks for the global biosimilars industry. This strategic combination brings together the complementary capabilities and strengths of both partners and prepares us for the next decade of value creation for all our stakeholders” Kiran Mazumdar-Shaw, Executive Chairperson, Biocon Biologics, said.
“The deal will enable BBL to attain a robust commercial engine in the developed markets of U.S. & Europe and will fast-track our journey of building a strong global brand. It will also make us future-ready for the next wave of products. This development takes our partnership with Viatris to the next level to realize our shared purpose of impacting global health by providing affordable access to high quality essential and life -saving Biosimilar drugs,” she added.
As per the agreement, Viatris will receive cash consideration of USD 2 billion on closing of the transaction and up to USD 335 million as additional payments expected to be paid in 2024. Additionally, upon closing of the transaction, BBL will issue USD 1 billion of Compulsorily Convertible Preference Shares (CCPS) to Viatris, equivalent to an equity stake of at least 12.9% in the Company, on a fully diluted basis. The transaction is expected to close in 2H-2022, subject to satisfaction of closing conditions (including certain regulatory approvals). The companies will also enter into a Transition Services Agreement, pursuant to which Viatris will provide certain transition services, including commercialization services, for an expected two-year period. Viatris also will pay USD 50 million to BBL to fund certain capital expenditures.