Biocon Limited, which announced its Q2 FY15 results on Tuesday, said despite many states offering sops for attracting investments, it’s open to setting up greenfield projects in Karnataka.
Kiran Mazumdar-Shaw, chairperson and managing director, Biocon, shared some of the future plans and strategies of the company with Praveen Bose. Excerpts:
What’s the update on Syngene’s listing?
We are focussed on a well-worked out strategic plan for Syngene which will lead to an initial public offering (IPO) and listing in the market. We are in the process of appointing bankers for the listing.
Are you planning any greenfield projects in Telangana or Andhra Pradesh? While both are extending sops to attract investments, could any of your plans for Karnataka be affected in anyway?
A lot of states are extending sops to attract investments. While Biocon is working to offset its capacity constraints by embarking on greenfield and brownfield projects, we can’t share specific details as of now.
Are you still open to greenfield projects in Karnataka?
We are in the process of greenfield expansion in Karnataka and will look at future projects as and when the situation so demands.
After the new government took over in Delhi, what efforts are being made to promote human trials in India?
The clinical trials environment in India has been improving, of late. The Ranjit Roy Chaudhury Expert Committee has been working on new guidelines aimed at building a rational, practical and ethical clinical trials regime. We are confident that in the next six months, there will be a clearer regulatory pathway for the industry.
What’s the status of Silver Leaf Oak’s acquisition in Syngene?
As disclosed earlier, Silver Leaf Oak has agreed to acquire a minority 10% stake in Syngene. Post the completion of this transaction, Biocon and Biocon Research Limited will jointly hold 85.54% stake in Syngene. We are committed to listing Syngene.
With the Malaysia facility going online in a while, by how much will this increase your capacity?
Our Malaysia facility is on track for commissioning this financial year. The commercialisation of insulins from the plant will commence post validation and regulatory approvals from respective countries. This facility will substantially increase our manufacturing capabilities and enable us to service the growing demand for insulins in emerging markets as well as prepare us for commercialisation in the developed markets.
How are you relooking at the the Middle East and North Africa (MENA) region? How long would it take you to mitigate the impact of the troubles in the MENA region? What were the products doing well there? Can’t you look at developed nations to neutralise the impact of loss from MENA region?
We intend to shift our marketing emphasis from the MENA region primarily because of the geo-political challenges in terms of credit risk for our bio-pharma business. While these markets continue to indicate robust demand, there are apprehensions on disruption of cash flow.
Therefore, as a strategy, we are looking to augment our presence in Latin America, Southeast Asia and Eastern Europe. However, given the gestation period for regulatory clearances it is not possible to share any definite timelines.
However, we are confident that the branded formulations and research services businesses will continue to drive growth for the remaining part of this financial year.
Emerging markets have a relatively shorter gestation period for regulatory clearances. So, while developed markets are part of our overall growth strategy, they tend to have longer regulatory timelines