Leading biotech company Biocon recently released its quarterly numbers which saw its revenues go up by 30 percent aided by growth in the biosimilars business. However, Biocon’s other two business segments including contract research services and generics saw some challenges. Peter Bains, Group CEO, Biocon amongst other issues spoke about how Syngene, the contract research segment of pharma major Biocon is set for a positive turnaround in the second half of the year as venture capital funds flow back into biotech, driving renewed investment and growth in the sector, about the surge in request-for-proposals (RFPs), expansion in bio-manufacturing, and the Biosecure Act, which is expected to turn current headwinds to tailwinds for the segment.

Q: What factors will be driving this anticipated growth for research services?

The research services were going through a transitory phenomenon fundamentally related to a tightening of the United States’ biotech venture capital funding. The anticipated growth is fueled by several factors. Firstly, the release of funds from VC’s, which will take more than a quarter to materialise. Additionally, we are seeing a significant increase in our request-for-proposals (RFPs).

The first quarter also saw the start of several pilot projects for pharma companies. Successful delivery of pilot projects is expected to build a foundation for larger-scale future collaborations.

What does the increase in RFPs mean for Syngene?

The RFPs are at a four-year high, up by 50 per cent year-over-year (YoY). We are confident that we will successfully secure some of these opportunities. Consequently, the challenges we are facing currently should turn into advantages in the second half of the year.

How well-positioned is Syngene to capitalize on the Biosecure Act?

Companies are looking to diversify their exposure to China with the Biosecure Act, leading to a significant increase in inquiries. While this shift will not yield immediate results, we anticipate a steady flow of inquiries as companies recalibrate over the next few years. We believe Syngene is very well-positioned to capitalize on this opportunity in India.

What role does bio-manufacturing play in Syngene’s growth strategy?

The bio-manufacturing supported by dedicated centers has continued growing despite the degrowth noticed in discovery services. This boost was led by both commercial and clinical-scale projects.

So the Syngene story is transitory. It is a turnaround, and we are expecting the momentum to build in the second half helping the research services to meet its guidance range for the year.

Can you also elaborate on how Biocon is addressing the pricing pressures in the generics segment?

The company is addressing the pricing pressure in the generics segment through geographical expansion and the launch of new products. We are actively expanding beyond our main market in US into Europe, Asia, Latin America, and Australasia. Upcoming launches include Liraglutide, a GLP-1 for obesity and diabetes

What impact are new product launches, such as Liraglutide, expected to have on overall performance?

We have secured approval in the United Kingdom to launch Liraglutide by the end of this fiscal year and are preparing for this independently and with our partner. Peptides, especially Liraglutide, are crucial for our generics business.

Obesity is a global epidemic with serious consequences leading to cardiovascular disease and diabetes. It is closely linked with diabetes, as they share common causes and occur together. Biocon is well-positioned to address this issue due to our long-standing global expertise and capability in insulins.

We are taking a global approach, filing in various markets and forming partnerships, like the recent collaboration with Handok in South Korea, to maximize patient reach. Additionally, other GLP-1 and peptide products like Semaglutide and Tirzepatide are being developed to strengthen our position in this market.

The biosimilar segment has shown strong performance. What were the main drivers for this growth?

The biosimilars have shown an 11 per cent on a like-for-like basis primarily driven by strong performance in the US where we have achieved significant market shares in our oncology business, with figures around 19 per cent to 20 per cent. The steady performance of the insulin business complemented this growth.

Looking forward, we aim to launch five products in the US over the next two years, and in Europe, three new products are in the pipeline. The current traction is encouraging and we can add these new products as fuel to that, to continue to drive a sustained momentum over the next few years.