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Biocon shifts focus on emerging markets, sees sales rebound

Biocon chairperson and managing director Kiran Mazumdar-Shaw in the company's annual report 2014-15 said, "In fiscal 2016, we are likely to see a rebound in sales that were muted last fiscal largely because of capacity constraints and geopolitical challenges emanating from the Middle East and North Africa region.

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Biocon chairperson and managing director Kiran Mazumdar-Shaw
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Biocon said it is expecting to see a rebound in sales in 2015-16 as it lowers its dependence on the Middle East and North Africa (MENA) and shifts focus to other emerging markets.

Biocon chairperson and managing director Kiran Mazumdar-Shaw in the company's annual report 2014-15 said, "In fiscal 2016, we are likely to see a rebound in sales that were muted last fiscal largely because of capacity constraints and geopolitical challenges emanating from the Middle East and North Africa region. Moreover, contract manufacturing arrangements and investments in capacity enhancement will help Biocon realise greater revenues this fiscal." The company is lowering its dependence on the MENA region by shifting focus to other emerging markets.

Arun Chandavarkar, chief executive officer and joint managing director, said, "We have managed a healthy operating margin despite lower off-take of a key specialty active pharmaceutical ingredient and temporary setbacks in the MENA region. Our earnings before interest, taxes, depreciation and amortisation (Ebitda) margin was steady at 24% despite a sharp 29% increase in research and development expenses." The company, on an average, has invested 10% of its biopharma revenues in R&D each year. It has spent over Rs 329 crore in R&D in 2014-15.

"Geopolitical uncertainties in some of the markets impacted our business in that region. We have put in place measures to overcome these temporary setbacks which we hope will yield desired results over the course of fiscal 2016," Chandavarkar said.

The annual report also said that the company has progressed with its generic insulin analogs and biosimilar antibody programmes that are partnered with Mylan. "Two molecules, Pegfilgrastim and Adalimumab, entered global Phase III clinical trials. The global Phase III trial for Trastuzumab initiated previously is progressing in more than 100 sites around the world. An initial emerging market-focused Phase III trial for Bevacizumab is also underway.

Two global Phase III clinical trials for generic Insulin Glargine have also progressed well with patient recruitment in Type 1 diabetes already completed and in Type 2 diabetes expected to be completed soon," the report said.

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