Biocon Biologics Limited has announced a comprehensive settlement and license agreement with Regeneron and Bayer for the worldwide commercialization of its biosimilar aflibercept, YESAFILI. This strategic agreement follows an earlier settlement covering the United States and Canada, establishing clear pathways for global market entry.

Agreement Details and Global Market Access

The settlement agreement with Regeneron and Bayer enables Biocon Biologics to commercialize YESAFILI, a biosimilar aflibercept (40mg/ml), across all countries worldwide. The agreement dismisses all pending litigation between the parties, clearing regulatory and legal obstacles for market entry.

Product Profile and Therapeutic Applications

YESAFILI is a vascular endothelial growth factor (VEGF) inhibitor designed to treat multiple ophthalmology conditions. The biosimilar has received regulatory approval from both the European Commission (EC) and the Medicines Healthcare products Regulatory Agency (MHRA).

Launch Timeline and Market Entry Strategy

The phased launch approach begins with the United Kingdom market in January 2026, followed by other settled countries in March 2026 or earlier under certain circumstances. Biocon Biologics previously secured market entry for the U.S. in April 2025, with launch planned for the second half of calendar year 2026.

The company has already launched YESAFILI in Canada earlier this year, with market entry secured in March 2024. This global settlement expands Biocon Biologics' presence in the ophthalmology therapeutic area as part of its strategy to increase patient access worldwide.

Strategic Significance for Biocon Biologics

According to Shreehas Tambe, CEO & Managing Director of Biocon Biologics, "This settlement paves the way for Biocon Biologics to make available our biosimilar Aflibercept globally. This milestone expands our presence in the ophthalmology therapeutic area as we work closely with healthcare systems to increase access to patients everywhere."

The agreement represents a significant addition to Biocon Biologics' portfolio of 10 commercialized biosimilars, which currently serve over 6.30 million patients across 120 countries. The company maintains a pipeline of 20 biosimilar assets across diabetology, oncology, immunology, ophthalmology, bone health and other non-communicable diseases.

Biocon Biologics Limited has received positive recognition from S&P Global Ratings, which placed the company on positive credit watch following its accelerated debt reduction initiatives. The rating agency's decision reflects the significant progress being made in strengthening the company's financial position through strategic restructuring.

S&P Rating Action Details

On December 10, 2025, S&P Global Ratings placed its BB long-term issuer credit rating on Biocon Biologics and the BB issuer rating on the senior secured notes issued by the company on credit watch with positive implications. The rating action underscores S&P's view that these developments represent a positive step toward retiring debt and improving the overall capital structure.

Strategic Transaction Structure

The positive credit watch follows Biocon's announcement to make Biocon Biologics a wholly owned subsidiary. The company will acquire approximately 25% stake held by minority investors in Biocon Biologics through equity share swaps. The transaction includes several key components that will significantly reshape the company's capital structure.

Biocon Limited plans to swap compulsory convertible preference shares (CCPS) held by Viatris Inc. in Biocon Biologics by exchanging them for equity shares and cash. The US$1 billion CCPS will be swapped for US$415 million worth of Biocon equity shares and US$400 million in cash. Additionally, Biocon will enable other minority investors to exit Biocon Biologics through similar arrangements.

Debt Reduction Impact

S&P Global's rationale highlights the material decline expected in Biocon's debt levels by March 2026. The rating agency treats the US$1 billion CCPS as debt-like in its financial ratios, making this transaction particularly significant for the company's credit profile.

Importantly, Biocon proposes to fund the cash consideration to be paid to Viatris entirely through fresh equity issuance of approximately ₹45 billion. The transaction eliminates other instruments that carried put options and allowed credit investors an earlier exit, which were previously viewed as debt-like by the rating agency.

Capital Structure Transformation

Proforma the transaction, S&P expects Biocon's capital structure to comprise only senior secured notes, bilateral loans, and working capital borrowings. By March 31, 2026, Biocon will have already repaid other optionally convertible debentures and redeemable non-convertible debentures issued to various investors, primarily through proceeds from its ₹45 billion equity issuance completed earlier in the year.

Credit Watch Resolution Timeline

S&P expects to resolve the credit watch on Biocon Biologics over the next 60-90 days once there is more clarity on the final capital structure and financial policy of the Biocon group. The resolution will depend on the completion of the equity issuance by Biocon to fund the cash payout to Viatris and the elimination of other debt-like instruments under the proposed transaction terms. The transaction remains pending shareholder approvals, and Biocon's ability to raise ₹45 billion through equity issuance is yet to be demonstrated.