 "Biocon Q2 FY25 results: Net profit declines 84% to Rs 27.1 crore")
Bengaluru-based biopharma Biocon on Wednesday reported a consolidated year-on-year decrease of 84.3 per cent in net profit to Rs 27.1 crore in the second quarter of the financial year 2025 (Q2FY25) from 172.7 crore in Q2FY24.
The company reported profit before tax (PBT) of Rs 98.4 crore, down 54.08 per cent in Q2FY25 from 214.3 crore in Q2FY24.
The total revenue for the period reached Rs 3,623 crore, a slight increase from Rs 3,620.2 crore in Q2FY24. Biocon’s EBIT (earnings before interest and taxes) amounted to Rs 718 crore, reflecting a 20 per cent margin.
Furthermore, revenue in the biosimilars business grew to Rs 2,182 crore from Rs 1,969 crore earlier, up 10.8 per cent. The positive growth can be attributed to gains in US Oncology and Insulins franchises.
“Biocon Biologics’ successful refinancing of its long-term debt of Rs 9,249.9 crore ($1.1 billion) through a combination $800 million (Rs 6,727 crore) bond listed on the Singapore Stock Exchange and a new $300 million (Rs 2,522.7 crore) syndicated loan facility was a credible success. This was Biocon Group’s debut bond issue and to be 3-time oversubscribed speaks about strong investor confidence in our Biosimilars growth potential,” said Kiran Mazumdar-Shaw, chairperson, Biocon Group.
Peter Bains, Biocon Group CEO, said that an 8 per cent operating revenue growth in Q2FY25, was driven by strong biosimilars performance, which offset weaker generics and a slight dip in Syngene revenues. The quarter saw a net loss of Rs 16 crore due to higher taxes, excluding exceptional items, the loss was Rs 13 crore.
Biocon stated that the Generics business continues to face pricing pressure and demand contraction. During the quarter, a planned shut-down of one of the API facilities was carried, which further impacted revenues.
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“We received a few drug product approvals in the US, UK, EU and MoW markets, which will support our near-term sales. The licensing agreements signed with two leading pharmaceutical companies in the Middle East and Brazil, for the commercialisation of our GLP-1 products will enable mid and long-term growth in these regions,” said Siddharth Mittal, CEO & managing director, Biocon.
“As stated earlier, we expect a transition to growth in the second half of this fiscal on the back of new product launches, including Liraglutide in the UK, as well as other injectable products, such as Micafungin and Daptomycin,” Mittal added.
“Syngene’s performance in the second quarter was broadly flat, in line with our expectations, the operating Ebitda margin stood at 27 per cent. We are witnessing early positive signs of recovery in Discovery Services, largely driven by collaborations on pilot projects with large and mid-sized biopharma clients who are looking for alternatives to China. With recent investments in the research and CDMO businesses, we are in a good position to leverage opportunities to drive medium to long-term growth,” highlighted Jonathan Hunt, CEO & managing director, Syngene International Limited.
In the quarter, Biocon received U.S. approvals for Sacubitril + Valsartan for chronic heart failure and Daptomycin for bacterial infections, alongside approvals for Micafungin in the UK/EU, Posaconazole in the UAE, and Tacrolimus in India. A new tender for Everolimus tablets was secured, with supplies to start in Q3FY25. Additionally, the company signed agreements in the Middle East and Brazil to expand its diabetes and weight management portfolio.
The firm received two separate US FDA surveillance inspections of Biocon’s API facilities in Bengaluru (Sites 1 & 2) that concluded in September with a few observations. During the quarter, it has also received Establishment Inspection Reports (EIRs) for both its API sites in Visakhapatnam (Sites 5 and 6) from the US FDA, following inspections conducted in June 2024. The company reported 19 per cent year-on-year growth, driven by market share gains in North America, European expansion, and multiple new launches in Emerging Markets.
“Biocon Group’s overall Q2FY25 financial and operational performance provides a foundation for improved performance as we move into the second half of the fiscal. Reported Operating Revenues of Rs 3,590 crore reflect YoY growth of 8% on a like for like basis and core Ebitda and Ebitda margins of 28 per cent and 20 per cent respectively remain healthy. We had a robust performance in the Biosimilars business, up 19 per cent on a like for like revenue basis, driven by strong market share gains in our US Oncology and Insulins franchises,” Mazumdar-Shaw said.
“Syngene has returned to sequential growth and has good visibility of a pickup in momentum in the coming quarters led by its Discovery Services and Biomanufacturing CMO business. Generics has continued to face price and demand pressures that have suppressed performance, but key new formulation launches in Q3 and Q4 provide the basis of a turnaround before the year end. All three businesses are tracking towards a better performance in the second half of the year, on the back of product approvals and unfolding market opportunities,” said Mazumdar- Shaw.
Group CEO Bains said, “We maintain our outlook for a transition to accelerating growth in the second half of the year with Syngene returning to growth, building momentum in our Biosimilars business and a recovery in Generics in the latter part of H2 driven by the launch of our first GLP-1 generic in the UK.”