Bidding for Biogen’s Biosimilars – Intas Best Placed Over Samsung & Dr. Reddy’s?

A bidding war is reportedly heating up for Biogen’s biosimilars portfolio, with three major pharmaceutical companies reportedly offering around $1 billion for the business unit – Samsung Bioepis, India’s Dr. Reddy’s Laboratories, and Intas Pharmaceuticals. Of the three, Samsung and Intas may be placed to gain the maximum from the acquisition.

Biogen’s biosimilars division focuses on developing and commercializing biosimilar versions of blockbuster biologic drugs like Humira, Remicade and Eylea. The portfolio includes three approved anti-TNF biosimilars – etanercept, adalimumab and infliximab in Europe, which contributed nearly $775 million in revenue last year. Biogen also recently launched its ranibizumab biosimilar Byooviz in the U.S.

The licensing and development of these biosimilars is done in partnership with Samsung Bioepis, while Biogen handles commercialization in Europe and the U.S. This 10-year deal is slated to expire during 2026-2028.

The Biogen biosimilars unit seems best aligned with Intas’ commercial strengths in Europe, while also diversifying its portfolio beyond generics. For Dr. Reddy’s, it provides a faster entry into biosimilars but may not move the needle materially.

For Samsung Bioepis, acquiring Biogen’s commercial rights would be a natural extension of the partnership, granting it end-to-end control of the biosimilars value chain. However, it could also create conflicts of interest, as Samsung manufactures biosimilars for other clients like Pfizer which compete with Biogen’s products. Samsung may drop out as acquiring the mature portfolio does not make strategic sense when weighed against potential conflicts of interest with its manufacturing clients.

For Dr. Reddy’s and Intas, the commercial rights would allow fast entry into the lucrative biosimilars space in Europe and the U.S., while instantly boosting their biosimilars portfolio. However, the business is unlikely to be a growth accelerator in the near term.

Samsung Bioepis – Conflict of Interest Risk

As Biogen’s long-time partner on these biosimilars, acquiring the portfolio would strategically align with Samsung’s strengths in biosimilar development and manufacturing. Samsung Bioepis is dedicated to developing biosimilars referencing branded biologic drugs. It has one of the broadest biosimilars pipelines globally, with over 10 biosimilar candidates spanning immunology, oncology, diabetes and ophthalmology.

However, Samsung also has manufacturing relationships with other pharmaceutical companies to produce their biosimilars. This includes an agreement with Pfizer to manufacture and supply biosimilars like etanercept and infliximab for the European market.

If Samsung acquires Biogen’s commercial rights, it would directly compete against Pfizer and other clients with its own etanercept and infliximab products. This could create significant conflicts of interest and raises potential anti-trust issues.

Samsung may need to set up clear firewalls and limits on information sharing between its manufacturing and commercial arms to mitigate this risk. But overall, acquiring the mature Biogen portfolio may not be an ideal strategic fit given Samsung’s already dominant position in biosimilar manufacturing.

Dr. Reddy’s – A Capability Booster, but Growth Limited

For India’s Dr. Reddy’s, acquiring Biogen’s portfolio would help plug a key gap in its biosimilars capabilities. It has been trying to build up a biosimilars presence for over a decade, but has lagged Indian peers like Biocon.

Dr. Reddy’s currently partners with Germany’s Fresenius Kabi for biosimilar Pegfilgrastim, which is already approved in the U.S. and EU. It recently filed Rituximab in the U.S. and EU, and is conducting trials for Tocilizumab and Abatacept.

Getting commercial rights to Biogen’s portfolio would provide Dr. Reddy’s immediate scale and revenue in biosimilars, while also bringing in Biogen’s regulatory expertise. This can help accelerate building its own portfolio beyond Revlimid, which faces patent expiration soon.

However, Biogen’s biosimilars business has stagnated over the past four years, with annual revenues around $775 million. The key products are maturing, increasing competition and pricing pressures in Europe.

The upcoming launches of Tocilizumab and Aflibercept biosimilars, expected from 2025-2027, provide some growth opportunity. But overall, Dr. Reddy’s is unlikely to see an immediate impact on its revenue growth trajectory from acquiring this portfolio.

The deal would also be Dr. Reddy’s largest, requiring substantial financing. While providing a new growth area, biosimilars are unlikely to offset Dr. Reddy’s issues in its core U.S. generics business.

Intas Pharma – Leveraging EU Presence

For India’s Intas Pharma, the Biogen biosimilars portfolio aligns well with its commercial presence and infrastructure in Europe.

Intas generates nearly half its revenues from the EU and UK, after acquiring Actavis’ UK and Ireland generics business in 2016.

It already has several biosimilars approved and marketed in Europe, including Semglee (insulin glargine), Accofil (filgrastim) and Erelzi (etanercept).

Acquiring Biogen’s portfolio would allow Intas to leverage its existing field force and relationships with payors and distributors to drive synergies. Scale is critical for profitability in the European biosimilars market.

The portfolio would provide Intas with mature, approved biosimilars and immediately boost its European biosimilars revenue by nearly 3-4 times.

While near-term growth prospects are modest, the deal would provide Intas with a steady cash flow stream from Biogen’s portfolio. Intas is reportedly keen to expand its European biosimilars presence, making it an ideal strategical fit.