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Oct 19, 2010, 09.26 AM IST
Biocon and Pfizer have entered into a global commercialisation agreement. In an interview with CNBC-TV18, Kiran Mazumdar Shaw, CMD, Biocon and David Simmons, President and GM, Pfizer gave perspective on the contours of the deal.
Biocon and global pharmaceutical major Pfizer have joined hands to deliver insulin treatments worldwide. Biocon will be responsible for the clinical development, manufacturing and supply of these insulin products.
Both Biocon and Pfizer expect their reach into the diabetes space to be significantly enhanced by this partnership. In an exclusive interview with CNBC-TV18, Biocon chief Kiran Majumdar Shaw, said, “We have a lot of synergy together with Pfizer. The deal size amounts to USD 200 million upfront payment and USD 150 million in terms of other milestones in addition to which we will be receiving additional payments linked to markets and sales in global markets.
Further Shaw added, “Though it cannot be quantified but this deal is a sizable opportunities for both the companies, with an immediate opportunity to penetration into the emerging markets. This is a huge endorsement of our biologics capabilities and we are looking forward to really making a big impact in the diabetes space in the years to come. In fact, this is the beginning of a partnership with Pfizer that can be built upon”
With 230 million diabetic patients worldwide, President and general manager of Pfizer David Simmons feels that the insulin market is under-served. “Our first step is to move to commercialisation in the 27 markets where recombinant insulin has already been approved by Biocon. The next stage is to clear regulatory pathways in Europe and in the
Below is a verbatim transcript. Also watch the accompanying video.
Q: If you can take us through the contours of the deal, we understand it will be USD 200 million of an upfront payment and about a Rs 150 million dollars milestone linked?
Shaw: That’s right. It's a very exciting day for us. I think this is a wonderful partnership that we have struck with Pfizer. We believe that together we bring a huge amount of synergy between us.
For Biocon this is a huge endorsement of its biologic capabilities and we are looking forward to really making a big impact in the diabetes space in the years to come. In terms of the deal size, as you said it is a USD 200 million upfront and USD 150 million in terms of other milestones in addition to which we will be receiving additional payments linked to markets and sales in global markets.
Q: Can you quantify that for us in terms of the additional payments that are linked to other markets and sales?
Shaw: At this point in time it's difficult for me to really give you any precise information but we look at this as a very sizeable opportunity for both companies. If you look at the insulin segment occupied today, it is about USD 14 billion. So we are very excited about this emerging opportunity which we think is going to be significant and sizeable. But most of this will actually start opening up for us post 2015.
Right now the immediate opportunity is in the emerging markets and it will get ramped up once the developed markets and the opportunity for biosimilars opens up in the US and European markets.
Q: How significant is this insulin opportunity from your point of view and you hope to enlarge this relationship with Biocon going forward?
Simmons: This partnership is very significant. I would like to give you some statistics on diabetes which is a terrible pandemic that has a significant societal burden. There are currently 230 million patients worldwide estimated to suffer from diabetes, which is expected to grow to more than 400 million by 2025.
So this is the market that's behind the USD 14 billion in sales of insulin products that Kiran just mentioned. So the size of the opportunity is significant. The societal need is huge because the market is underserved. There are access issues to many patients who need these therapies across the world. We think the partnership of Pfizer with Biocon is going to be able to make a significant difference in this area.
Q: Do you expect this relationship in a sense to give a large fillip to your own R&D activities?
Shaw: I think this is a start of a very big partnership that we can build with Pfizer. We think that for us insulins is a very large opportunity and we wanted obviously to see our products present in global markets and the Pfizer partnership obviously allows us to have this global reach. We are really looking at using this as the foundation of doing many more things with Pfizer. But this is the most important first step for us.
Q: How are you going to align this partnership with Pfizer, with some of your existing partnerships or alliances, for instance with Bristol-Myers Squibb?
Shaw: These are all very different kinds of partnerships that we have built up. I think each one of them is a strategic partnership for us.
As far as Pfizer is concerned, we are very focused on making a huge global success of these portfolios of products that we are developing. Pfizer will obviously enable us to get a large global footprint. So this is a way we are looking at this relationship. We believe that diabetes is a very important segment for both the companies. So we look at this as the way forward.
Q: There has been a lot of speculation and lot of reports on Pfizer possibly picking up a stake in Biocon. I know you have talked about a partnership with immense amount of possibilities. But could that be a potential possibility as well?
Shaw: You said it in your own words, this is speculation. So obviously this deal is not about speculation. This deal is real and this is about a strategic partnership.
Q: If you could give us some sense of what stage 2–3–4 could be? Kiran said this is the first step in your partnership. Could you give us some sense of what we can expect in the future?
Simmons: If I can focus on the family of insulins and this diabetes partnership step one is to move the commercialization in the 27 markets where recombinant insulin has already been approved from Biocon. The next stage is to clear regulatory pathways in Europe and in the US. That's our immediate focus. I would say that's stage 1, 2 and 3 all wrapped up over the coming years.
I would point out that this strategic partnership makes a tremendous amount of sense. One you look at Biocon and their high quality manufacturing and development capabilities, combined with their speed to market on the insulin family, we project that they are the farthest ahead of any company globally with the complete family of insulin products.
At the same time, physicians are going to be key decision makers in the utilization of biosimilars in this space. Pfizer's sales, marketing and medical infrastructure globally is going to be responsible for bringing the evidence that shows effectiveness and safety of these products. Together this combination is really going to received well by patients and healthcare practitioners worldwide.
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