Major blow for India’s largest biotech company.
Pfizer has scrapped its deal to sell insulin products made by Biocon, ending a partnership that had yet to hit the two year mark. The breakup leaves Biocon without a partner to sell its insulin drugs in key markets, including the United States, and could leave untapped an opportunity for of hundreds of millions of dollars in royalties for the company.
Biocon’s CEO Kiran Mazumdar-Shaw stated in a pair of tweets that the conclusion of the pact was amicable and the result of changing strategies. Pfizer cited its continued attempt to narrow its focus and different priorities within its biosimilar program for the split.
The news brings to an end a biosimilars deal that was at the time of its conception considered a major development. Pfizer had agreed to spend up to $350 million for the right to market biosimilar insulin formulations created by Biocon. Together, Pfizer and Biocon had hoped to earn a bigger slice of the $40 billion diabetes drug and device market, an ever more competitive space energized by generic and top tier-pharma interest alike.
Though the pact never met the companies’ expectations, Biocon still remains committed to delivering its biosimilar insulin portfolio to global markets. “Biocon will continue to work with its existing partners in several markets and will pursue a commercial strategy on its own and through new alliances in other markets,” Shaw said in a statement.
Some analysts had suggested that Pfizer is still dedicated to developing a broad portfolio of biosimilars, but that the company is simply allocating its resources to less competitive areas. The insulin market is already dominated by three major players in Novo Nordisk, Sanofi, and Eli Lilly and it would be difficult for Pfizer to squeeze its way into the mix.
The news sent Biocon’s shares down 8 percent on the day of the announcement and while the company still has partnerships in emerging markets it loses approximately 70 to 80 percent of its market—consisting mostly of the U.S. and Europe—by severing ties with Pfizer.
Biocon said that though Pfizer is no longer a partner, it will continue to leverage its regional partners to expand its business.
By VINAY SINGH