Biotechnology company Biocon plans to invest around USD 200 million (approximately ₹1,500 crore) during the 2020-21 financial year on capital expenditure, as outlined in its Annual Report for 2019-20. 

According to the annual report, the investment will be equally divided between the small molecules and biosimilars divisions. This capital expenditure will be funded through a mix of internal earnings, loans and additional private equity investment in Biocon Biologics.

The company had spent ₹974.2 crore on capital projects in the previous year. Investments included setting up a manufacturing facility in Visakhapatnam for immunosuppressant products under the small molecules segment. In biosimilars, major spending went into a new antibody production facility in Bengaluru, expanding drug manufacturing capacity at existing plants, and building a research facility in Chennai.

Biocon’s CEO and Managing Director Siddharth Mittal said research and development remains central to the company’s strategy, and investments will continue across all business areas. Biocon has a strong pipeline of 28 biosimilar molecules that require ongoing funding. It is also expanding its range of complex generic medicines and pursuing a selective portfolio of novel biologics. R&D spending is expected to increase in 2020-21 compared to the previous year, with gross expenditure projected to remain between 12 per cent and 14 per cent of revenues, excluding Syngene.

According to the annual report, the company is aiming to reach USD 1 billion in biosimilars revenue by 2021-22. It expects the biosimilars market to grow significantly, particularly in developed countries. Key growth drivers include recent and upcoming launches such as Trastuzumab in the US, Insulin Glargine in the US and Pegfilgrastim in the EU, followed by Insulin Aspart and Bevacizumab in the US and EU through Biocon’s partner, Mylan. These launches, along with increased market penetration of existing products in the US and Europe, are expected to boost revenues.

There is also strong growth expected in Most of the World (MoW) markets, which are seen as important contributors toward the company’s revenue goals. With an existing presence in most of the top 20 global markets, Biocon is well positioned to expand through new product launches and market entries. The company believes its global reach and cost efficiency will support its ambition of becoming a leading global biologics player and achieving the USD 1 billion target.

In terms of revenue distribution, the US is expected to contribute the most in 2021-22, followed by MoW markets, and then Europe and other developed regions. For the small molecules business, revenue is expected to grow in the high single-digit to low teen range over the next two years. While the active pharmaceutical ingredients (API) business remains a key contributor, future growth is expected to come from generic drug formulations in the US. In 2019-20, this segment reported revenues of ₹2,093.7 crore, an 18 per cent increase over the previous year.