Biocon Ltd aims to spend 14 per cent of revenue on R&D in FY21
The pharma major Biocon Ltd released its FY20 annual report on Thursday. It is one of the first to submit full-year report of FY20. Among a few other key highlights of the annual report, its increased focus on research and development (R&D) expenditure can be attributed for higher importance, as its FY21 strategy.
The company aims to spend on R&D programs between 12 per cent and 14 per cent of revenues (ex-Syngene) in FY21. This is much higher than nearly 5 per cent to 8 per cent during the previous years. The expenditure would further strengthen the pipeline of 28 molecules in its biosimilars business. The company aims to continuously build on the portfolio of complex generic products, which falls in line with its long-term growth strategy. In addition to this, its continued investment in products of novel biologic products will also hold a key perspective during the current fiscal.
As far as capex spends are concerned, it envisages spending nearly Rs 1,500 crore in FY21. The total expenditure will see an equal split of small molecules and the biosimilars. It stated that this capital expenditure is to be funded via a combination of internal accruals, debt and additional private equity investment in Biocon Biologics.
Higher R&D spending is something that leads to the overall growth of the company. Hence, such growth during challenging business environment would be something that the investors would be keen to watch.