Biotech company Biocon saw a dip in net profit of 46 per cent to ₹92 crore, due to high interest and depreciation costs incurred in its Malaysian facility and a drop in licensing revenues.

In the year-ago quarter, Biocon had posted a net profit of ₹171 crore in the third quarter of the previous fiscal year.

Biocon said that the interest and depreciation costs related to its Malaysian insulin facility went up 40 per cent on a yearly basis to ₹112 crore, while licensing income from biologics division came down dramatically from ₹79 crore to ₹12 crore. The sales of small molecules or API business declined 9 per cent to ₹369 crore in the December-ended quarter, largely due to the headwinds it faced from pricing pressures and channel consolidation in the US.

Revenues from the biologics vertical, comprising novel biologics and biosimilars, declined 15 per cent to ₹190 crore, as the company had to undertake plant modification as mandated by the US FDA, which hit sales. Biocon, however, said that adjusted for licensing income, product sales grew 16 per cent growth on a yearly basis in the reported segment.

All this impacted EBITDA margins, which were 23 per cent in the third quarter of 2018 fiscal, a 7 percentage point decline when compared to the year-ago period. However, its branded formulations and research services grew 27 per cent and 17 per cent, respectively, on a yearly basis.

Biocon obtained USFDA approval for biosimilar Trastuzumab partnered with Mylan. Apart from getting the US FDA approval for its biosimilar Trastuzumab, the branded formulations and research services reported healthy double digit growth. Chairperson and Managing Director Kiran Mazumdar Shaw said that the company expects growth in other segments to revive from early next fiscal.

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