Biotech company Biocon reported 78 per cent growth in profit in the recent March quarter. This was largely on account of the exceptional gain on the sale of 10 per cent stake in Syngene International, Biocon’s research services subsidiary, to IVF Trustee Company. The deal valued Syngene International at ₹3,800 crore.
Biocon’s operating profit growth for the March quarter was muted at 5 per cent on two counts. First, the company’s legacy bio-pharma business posted a meagre 11 per cent growth. This was largely on account of a sedate 6 per cent growth in the domestic formulations business. Second, higher research and development spend, particularly for its global insulin development programme and biologics, ate into Biocon’s operating profit.
Despite the lacklustre performance by Biocon’s biopharma segment, its research services business continued to grow at a healthy pace. The revenue from Biocon’s contract research business, which includes research services subsidiary Syngene International and clinical research organisation (CRO) arm Clinigene, rose 27 per cent during the quarter.
Biocon last week filed the draft prospectus for listing Syngene International; the offer is expected to be completed by July 2015.