Serum arm to double investment in Biocon unit
Serum Life Sciences, a unit of India’s largest vaccine maker, would pick up an additional stake in Biocon Biologics “through the conversion of the $150 million loan provided to Biocon Pharma Pvt Ltd”. The deal was struck at an enterprise valuation of $6 billion, a Biocon spokesperson said.
This is an addition to Serum’s previous investment in November 2022, when it invested $150 million for a stake in the biosimilar subsidiary. Serum’s equity infusion at the time helped Biocon Biologics acquire Viatris’ global biosimilar business as Biocon had made the upfront $2 billion payment at the time through a $650 million fund infusion from Biocon Ltd.
With the new arrangement, Biocon Biologics will have access to 100 million doses of vaccines annually together with the distribution rights to Serum’s vaccine portfolio, it said. The two companies signed a strategic pact in September 2021 for vaccines and infectious diseases antibodies. At the time, Biocon said the alliance would provide Biocon Biologics ‘an asset-light and accelerated entry into the vaccines segment’.
Biocon said that both firms had agreed to withdraw from “the original equity structure contemplated under their strategic alliance announced in September 2021.”
They did not specify why, but noted that while Biocon had secured an NCLT approval in Karnataka, SILS had not secured an NCLT approval in Maharashtra.
Biocon Biologics has previously raised significant capital from several investors to expand its biosimilar manufacturing capabilities which has steadily increased its valuation over the last three years.
In January 2020, True North invested ₹536.25 crore for a 2.44% stake which valued Biocon Biologics at a pre-money valuation of ₹21,450 crore or around $ 3 billion, the company said at the time. Tata Capital Growth Fund put in around $30 million at a valuation of $3.5 billion in June 2020.
In November 2020, Goldman Sachs issued optionally convertible debentures at a post-money equity valuation of $3.94 billion. In January 2021, ADQ picked up a 1.80% stake at a post-money valuation of $4.17 billion.