1. Market entry strategy for Mihir Pandit [PC-09] Jigar Raval [PA-08] Vipul Patil [PA-20] Bhakti Shethia [PC-20] Sneha Agarwal [QA-17]

2. OUTLINE Biocon-Snapshot Country Choice-Why South Korea? External Challenges :Drivers and Restraints Forecast trends Entry Mode Strategy Target market and Positioning Strategic Implementation Controls 3. BIOCON SNAPSHOT VISION Biocon is an emerging, global Bio-pharmaceutical enterprise that is focused on developing affordable products and services for patients, partners and healthcare system across the world. Biocon is committed to: Reducing therapy costs of chronic diseases. Research and marketing partnership that provide global access. Leveraging the India cost advantage to deliver high value, licensable R & D assets. Source: http://www.biocon.com/docs/Biocon_H1FY1_MediaPrstn.pdf 4. COMPANY PROFILE Source: http://www.biocon.com/docs/Biocon_H1FY1_MediaPrstn.pdf 5. COMPANY PROFILE Source: http://www.biocon.com/docs/Biocon_H1FY1_MediaPrstn.pdf 6. PRODUCT PORTFOLIO Source: http://www.biocon.com/docs/Biocon_H1FY1_MediaPrstn.pdf 7. PRODUCT PIPELINE 2 New drugs in late stage clinical trials Source: http://www.biocon.com/docs/Biocon_H1FY1_MediaPrstn.pdf 8. CEO PERSPECTIVE: WHY SOUTH KOREA? Focus on high growth product classes Continuous monitoring of Biobetters globally. Scalable production facilities Parallel product registration in developed markets products launch quickly and gain advantage. Partnerships with CROs will help speed up the drug development and registration process. 9. COUNTRY CHOICE Why choose South Korea Biosimilar market? Long history in manufacturing biologicals A regulatory pathway for biosimilars Requires upfront investment and infrastructure for the development, much lesser than biologics Source: Frost & Sullivan analysis Exports are expected to contribute as much as 50% of the total revenues. Governments policy to promote the biosimilars industry Korean Food and Drug Administration (KFDA) BLA (biologics license application) By 2030, its total number of retirees is forecast to be approaching 40% of the population. http://www.icis.com/blogs/asian-chemical-connections/2012/11/south-koreas-demographicchall/#sthash.2x5UWyfc.dpuf Universal coverage of population through social health insurance (SHI) since 1989 High out-of-pocket payment, amounting to 35-40% of total health expenditure Social insurance for long-term care, introduced in July 2008 10. COUNTRY CHOICE Rank Disease Deaths % 1 Stroke 38497 17.19 2 CHD 20496 9.15 3 Lung Cancer 16437 7.34 4 Diabetes Melitus 13766 6.15 5 Stomach cancer 12794 5.71 6 Liver cancer 11797 5.27 7 Suicide 11408 5.10 8 Road traffic accident 7570 3.38 9 Colon cancer 7562 3.38 10 Liver disease 7406 3.31 Biocons Product portfolio is very suitable to penetrate market Source : WHO health statistics 11. 20 20.4 20.8 21.8 22.9 24.1 26.0 28.1 30 30.6 31.2 33.1 35.1 37.2 40.9 45.0 5 5.1 5.2 5.4 5.6 5.9 6.2 6.6 6 6.2 6.4 6.9 7.4 8.0 9.0 10.1 0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0 2010 2011 2012 2013 2014 2015 2016 2017 Human Growth Hormone Erythropoietin Monoclonal Antibodies GCSF COUNTRY CHOICE Biosimilars Market: Revenue forecasts (Korea), 2010 Years Revenues($million) Source: Frost & Sullivan analysis Biosimilar market is growing very rapidly and South korea in particular, with plan to become a leading biosimilars player. 12. ENVIORNMENT 1. 35% R&D biosimilar Investment in 2012 while in chemical drug development accounted for just 12 %. 2. Tailored consulting programme by KFDA 3. Columbus Project in 2011 4. Out of 36 biosimilars 47% are Mab included in korean pipeline. 5. Global leader with 17 mAb portfolio by 9 korean co. 6. Paradigm shift away from imitation towards innovation by focus on biobetters. Regulatory enviornment Operating environment 1. New pricing system 2. Pharma industry competitive enhancement plan: 3 criteria: Four benefits from govt: 1. Drug price benefit 2. Tax system support 3. Financial support 4. R&D support 13. Chalebols: Business conglomerate like Samsung and LG Samsung to invest 389 million in biosimilar devlopment. Extreme pressure on local generics.(limited resources) EU-FTA: July 2011 US-FTA March 2012 Tariff abolition Strengthen IPR protection Current negotiation with ASEAN countries and other countries. Korean govt planning to invest 1 trillion won. Democratic union party if elected-renegotiate . Local Industry and FTAS ENVIORNMENT 14. EXTERNAL CHALLENGES: 15. DRIVERS: 1. Strong experience + Active government support 2. Accessibility +Cost 3. Focus on high growth G-CSF &Mab 4. Early mover advantage 5. Strategic partnership: Korean Biosimilars co. +foreign co. 6. Exmple: Samsung+ Quintiles RESTRAINTS: 1. Large capacities for approval (FDA/EMEA/PMDA) 2. Deep pockets. 3. Cost Effectiveness Major threats in Asia 4. Ambiguity in nomenclature. 5. Reluctance by physicians EXTERNAL CHALLENGES: 16. Forecast assumption 1. Market volume 2. Biosimilars penetration 3. Biosimilars market share 4. Economy indicators Revenue forecast discussion Among four segments 1.Erythropoitins : Example: Espogen by LG life science 2.Human growth hormone: Example: Euotropin FORECAST TRENDS 17. ENTRY MODE STRATEGY Source: http://www.imshealth.com/ims/Global/Content/Home%20Page%20Content/IMS%20News/Biosimilars_Whitepaper.pdf 18. ENTRY MODE STRATEGY Current Scenario: Innovation is not an easy game and my business model proves it can be done through partnering. One problem with India has been that we are not good at innovation. My model has been about partnering for innovation. - Kiran Mazumdar Shaw New Proposition : Strategic alliance with LG life science ltd as an entry mode strategy. Vision : To become a "top-tier life sciences company with world-class new drugs" 19. Main aim: Risk sharing & Increasing competitive strengths To enter the South Korean market Health profile of South Korea Extensive sales & marketing network R& D resources & know-how Emerging as a global top brand in the diagnostic field To add to the existing product portfolio RATIONALE FOR SELECTION 20. ENTRY MODE STRATEGY COMPETITIVE ADVANTAGE OF ALLIANCE HURDLES Fast entry into the foreign market Minimum risks Better understanding of the host country Access to new technology More efficient production & innovation Price plays a key role Competition with local Biosimilars Huge promotional investment Changing regulatory policies Conflicts of control 21. TARGET MARKET Aging korean population demanding affordable therapy for diabetes, cancer & Cardiovascular diseases Large pool of patients Prevalence of diabetes- 8%, Incidence of disease 0.4% per year Insulin therapy Huge demand for affordable products Non-small Cell Lung Cancer drug market Majority of patients in stage III or IV at the time of diagnosis 22. POSITIONING Commodity Differentiated BIOSIMILARS Payer driven Acute treatment Price driven Lower risk of immunogenic reaction Fully understood mode of action Chronic treatment Limited competition Higher risk of immunogenic reaction Mode of action not clear Influenced by multiple stake holders 23. PLACEPROMOTION STRATEGIC IMPLEMENTATION PRODUCT PRICE Tailor go-to-market approach To local dynamics, both in terms of sales force model and marketing offering Target Therapy areas Build trust and network development Human Insulin Insulin Lispro Monoclonal Antibodies Oncology products Specialty and primary care products lower cost biosimilar drugs Value based pricing Payer Strategy South Korea Export drugs to Asia and developed countries (EU, USA) through LGs distribution network 24. CORRECTIVE ACTIONCOMPARE ACTUAL Vs PLANNED PERF. CONTROLS SETTING STANDARDS MEASURING ACTUAL PERFORMANCE Build lasting, collaborative relationships with our customers To check the above, consumer satisfaction and feedback website Doing whats right for patients, customers and employees Transaction strategy to balance and grow portfolios Identification and evaluation of investment opportunities Financial Report This is the point of decision making A thorough understanding of highly complex and dynamic healthcare systems To be done quarterly initially and take proactive actions In case of failure ,send a specialized team to assess the situation(risks and benefits of continuation). Quality system design and optimization GCP, GLP, GMP and cGMP compliance and risk mitigation 25. PUBLIC OPINION India- Global leader in Biosimilars