An­a­lysts Give a Thumbs Up to Bio­con’s Biosim­i­lars Progress

HSBC Sec, Mor­gan Stan­ley, Citi turn bullish on co af­ter it says its in­sulin glargine has met pri­mary tar­gets

The Economic Times - - Companies: Pursuit Of Profit - Di­vya.Ra­jagopal@ times­group.com

Mum­bai: An­a­lysts gave a thumbs up to Bio­con af­ter the com­pany said its copy of bio­phar­ma­ceu­ti­cal in­sulin glargine met the pri­mary tar­gets, which in ef­fect takes the prod­uct closer to reg­u­la­tory fil­ings in the US.

With the biosim­i­lar in­sulin cross­ing key in­terim mile­stones in the global phase-III, or ad­vanced, clin­i­cal devel­op­ment pro­gramme, the Ben­galuru-based drug maker said on Tues­day, it is on track for reg­u­la­tory fil­ings in the US and Euro­pean Union in the cur­rent fis­cal year. Bio­con said also the global Phase III study for peg­fil­gras­tim, a can­cer treat­ment, has been com­pleted and it has met the pri­mary end­point of demon­strat­ing clin­i­cal equiv­a­lence with the ref­er­ence prod­uct.

“We are ex­cited about four po­ten­tial biosim­i­lar fil­ings (glargine, tras­tuzumab, peg­fil­gras­tim and adal­i­mumab) in FY17 though launch will be dic­tated by po­ten­tial lit­i­ga­tion and in­ter­change­abil­ity is­sues. We be­lieve in­sulin glargine fil­ing holds the most po­ten­tial, given lim­ited num­ber of play­ers and big mar­ket,” wrote Girish Bakru, health­care an­a­lyst, HSBC Se­cu­ri­ties.

Mor­gan Stan­ley said it is over­weight on the stock. “Dur­ing the quar­ter, it re­ceived ap­proval for in­sulin glargine in Ja­pan (launch in F1H17). This should po­si­tion its fil­ing favourably in the US/EU and also gives ac­cess to mul­ti­ple large EM mar­kets such as South Africa, Brazil, Rus­sia, and Turkey. It has part­nered with PiSA (Mex­ico) to tar­get rh-in­sulin in the US (mon­eti- za­tion in 2020 or later). We con­tinue to po­si­tion Bio­con as a multi-year growth and rerat­ing story,” it said in a note to clients.

Citi too raised the tar­get price of the stock. Research ser­vices re­main the key growth driver (for Bio­con) but there are some signs of a pickup in other busi­nesses as well, it said in a note. “The com­pany ap­pears to be mak­ing good progress on biosim­i­lar ini­tia­tives; we be­lieve this is the pri­mary driver of stock val­u­a­tions.” Bio­con on Tues­day re­ported a 79% jump in its net profit for the fourth quar­ter of fis­cal 2016. The com­pany re­ported a net profit of .₹ 361 crore. Rev­enue crossed .₹ 1,000 core, up 17%.

Bio­con said also that it re­struc­tured its le­gal en­ti­ties to align with the growth strate­gies rep­re­sented by its strate­gic busi­ness units.

“All our biosim­i­lar as­sets will now be con­sol­i­dated un­der the new le­gal en­tity, Bio­con Bi­o­log­ics Lim­ited in­cor­po­rated in the UK as a sub­sidiary of Bio­con Lim­ited, In­dia”, Man­ag­ing Di­rec­tor Ki­ran Mazum­darShaw said on a con­fer­ence call.

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