Biocon on Friday refuted media reports that said the company is evaluating a plan to sell its generic active pharmaceutical ingredient (API) business to reduce its overall debt. “Biocon is neither evaluating any divestment options for its APIs business nor consulting any bankers,” it said in a regulatory filing.
Earlier, a media report citing sources had said that Biocon is evaluating a plan to sell its generic active pharmaceutical ingredient (API) business – estimated to be worth $1.5 billion – to reduce its overall debt, though it is yet to take any concrete action. “Discussions with investment banks have taken place but the plan (for sale of generic API business) is still on the drawing board,” the report had stated.
“The Company has a strong pipeline of niche fermentation-based APIs, peptides and high potent API products for the near- and long-term growth of its integrated APIs and Generic Formulations business,” the spokesperson added.
Biocon’s generic API business has been one of the primary contributors to the firm’s consolidated financials. During the second quarter of FY24, APIs and Generic Formulations business recorded revenue at Rs 676 crore, up 4 per cent fromRs 652 crore during the same period last year. However, the company had also said that a contraction in demand for some API products on account of pricing pressures, coupled with phasing of supplies due to a planned maintenance shut down, impacted the performance of the API business.
“Looking ahead, we expect an improved performance in the second half of the fiscal with sustained delivery in Generic Formulations and some recovery in our API business,” Siddharth Mittal, CEO & Managing Director, Biocon Limited, had said.