Biocon to maintain margin despite fall in India sales: Kiran Mazumdar Shaw

Despite a dip in domestic sales after demonetisation, Biocon's export realisations have improved on a depreciating rupee.

Biocon quarterly result — Share of domestic sales in Biocon's total revenue remains small.Reuters

With demonetisation impacting domestic sales numbers, biopharmaceutical company Biocon said on Tuesday it would be able to maintain its margin in the coming quarters as export realisation has improved on the back of rupee depreciation. It also said the overall share of domestic sales in total revenue is not significant to impact profitability.

In an interview with CNBC TV18, Kiran Mazumdar Shaw, Chairman and Managing Director of Biocon, said the company sees greater opportunities for its biosimilar products in the US and other developed markets.

"Given our exposure to the Indian market being very small, we haven't seen much of an impact (due to demonetisation) but having said that our India business certainly has been impacted over the last month in the form of lower sales," the report quoted Shaw as saying.

According to the company, chronic therapy usage has been impacted to a small extent. "Since our dependence on this business is not huge, it doesn't impact the overall business. In fact, we have benefited from a weaker rupee in terms of our export realisations," she said.

On margins, Shaw said Biocon would be able to sustain both its revenue and margins at last quarter's levels. "We hope to at least sustain those levels in terms of our operations," Shaw said. The company reported margins of over 20 percent during recent quarters.

Biocon and Mylan have recently submitted dossiers of their first biosimilar product Trastuzumab with the US FDA, which is meant to treat breast and gastric cancers. "There is a huge opportunity for biosimilars in the US market. If you go by what is happening today with the already approved biosimilar, there is a huge uptake of biosimilars," Shaw said, adding that the review process of the drug could take anywhere between 18-24 months. She also said that biosimilars also offer a billion dollar opportunity in emerging markets.

Talking about its contract research organisation Syngene, Shaw said it would definitely deliver double-digit growth and maintain its leadership in research services field.