Biocon Chairperson and Managing Director Kiran Mazumdar-Shaw is in a firefighting mode, as the company she founded was forced to call off a blockbuster deal with global pharmaceutical major Pfizer. She tells Raghuvir Badrinath how she intends to pick up the threads. Edited excerpts:
The deal with Pfizer was an inflection point for Biocon. But all of a sudden, the deal has been called off. What went wrong? Was failure in meeting milestones a reason?
It is no doubt a disappointment that we had to end our pact. Pfizer marketing your products globally, including the US and European markets, is a great achievement. The reason Pfizer exited is due to a change in business priorities in its biosimilars programmes, which are largely monoclonal antibodies and recombinant prominent proteins. We parted ways amicably and it is certainly not the end of the road for us. Pfizer discussed in detail with us about their plans and we felt it was not the path for us. There is absolutely no truth that we did not meet milestones.
As part of this deal, we had earlier received $100 million from Pfizer as upfront payment. There was another $100 million in the escrow account, a majority of which we will get, as well. Also, since the deal was called midway, we will get a settlement fee that will be reflected in our Q4 numbers. There is no impact on our short-term revenues.
How will Biocon now take its products to global markets?
Even before Pfizer came on board, we had 15 partners in various emerging markets like Mexico, Brazil, etc. The partners were supposed to cooperate with Pfizer. Post the break-up, we intend to tap more regional partners. We won’t go in with a single partner for global markets for the four insulin products. We still have to take a call on how we plan to address the mature US and European markets.
The pact with Pfizer lasted all of 18 months. How did the sales pan out?
It was very minimal. Pfizer started sales only in India and it was pretty miniscule. Sales in the mature US and European markets were to start from 2015. And, post that, there was hope of good revenue inflow. But, that was not to be. There is potential in the products we have developed and we have time to tap the mature markets by getting partners.
During early last year, tests for developing an oral insulin product did not meet expectations...
We are betting on oral insulin. It is a game-changer. Yes, there was a small setback, and we have taken it in our stride. We are examining various options of aligning with a global major to take the product forward, and we should be ready with announcements soon.