China's Biomab Holding, India's Cipla go separate ways on biosimilars

Biomab Brilliant has paid $25.8 million to India's Cipla for 100% of Biomab Holding in a transaction that sees both firms carve out a new direction in the aim to produce biosimilar drugs, a path many drug firms in both countries are busy at work on.

The transaction for the 25% stake owned by Cipla by British Virgin Islands-based Biomab Brilliant is, for now, a slight exit out of China for Cipla. Biomab Holdings, headquartered in Hong Kong, but with operations in Shanghai, makes products in China for sale there as well as abroad.

Collaboration with China by firms in the region however has shown some spark, with most recently South Korea biotech Genexine licensing out 5 protein therapies with a subsidiary of China's Tasly Pharmaceutical worth a potential $125 million.

Both Genexine and Tasly are busy on the development front, with the terms of their deal through Tasly unit Tasgen Bio-Tech seeing Genexine getting $20 million upfront and commercial and development milestones potentially kicking in another $80 million.

Tasgen gets China rights for three Genexine clinical candidates, human growth hormone GX-H9, GLP-1 receptor agonist GX-G6 for diabetes and neutropenia preparation GX-G3.

But India has struggled to match companies in Europe, the United States, and South Korea and to a growing extent China in the race to produce biosimilar drugs, though firm's like Dr. Reddy's Laboratories ($RDY) are working with multinationals as well as developing in-house strategies to be part of the market.

Chandru Chawla, head of Cipla's new ventures unit, said in the Economic Times in October that India's "fundamental disadvantage" over the United States, Europe and South Korea was that biotechnology never evolved in India to the extent that chemistry did.

But Chawla, in a press release announcing the exit from Biomab Holding, said the company too has a strategy to focus on developing biosimilars for the Chinese market under Cipla BioTec, aimed at development, manufacturing and sales of biosimilars in therapeutic areas such as cancer, auto-immune diseases, respiratory diseases and diabetes.

"Cipla is seeing some very good momentum in its biotech programs. Through Cipla BioTec we will focus on global product development with the aim of making biological therapies accessible and affordable to patients in need," Chawla said in the release.

- here the release (PDF)