UPDATE 3-Pfizer to sell biosimilar insulins in Biocon deal

* Pfizer to pay $200 mln up front

* Shares of insulin maker Novo Nordisk slump 5 pct

* Pfizer’s shares down 6 cents
(Adds company, analyst comments, details on drugs)

By Lewis Krauskopf and Bharghavi Nagaraju

NEW YORK/BANGALORE, Oct 18 (BestGrowthStock) – Pfizer Inc (PFE.N: )
will sell insulin made by India’s Biocon Ltd (BION.BO: ) in a
deal that deepens the world’s largest drugmaker’s push into
biosimilar medicines and diabetes.

Pfizer will pay Biocon $200 million up front under the
agreement announced by the companies on Monday. Biocon will
also be eligible to receive additional development and
regulatory milestone payments of up to $150 million plus
payments related to sales of these medicines.

Pfizer stands to gain greater access to the $14 billion
market for insulins used to control diabetes ahead of 2015,
when a number of products are expected to lose patent
protection.

It also marks one of the most significant deals for Pfizer
as the company seeks a foothold in selling similar versions of
biotechnology medicines.

Shares in Denmark’s Novo Nordisk (NOVOb.CO: ), the world’s
biggest insulin maker, were down 5 percent.

Pfizer will have exclusive rights to commercialize Biocon’s
drugs globally with certain exceptions, such as Germany, India
and Malaysia, where Biocon will have co-exclusive rights.

The products will be versions of recombinant insulins sold
now under brand names Novolin by Novo Nordisk and Humulin by
Eli Lilly (LLY.N: ); as well as glargine, which is sold now as
Lantus by Sanofi-Aventis (SASY.PA: ); aspart, sold by Novo as
Novolog; and lispro, sold by Lilly as Humulog.

Pfizer’s “participation in this market does raise the bar
for the major producers of insulin over the long-term,” Leerink
Swann analyst Seamus Fernandez said in a research note.

Biocon’s recombinant, or genetically engineered, insulin
products are already approved in 27 countries in developing
markets.

Pfizer expects to gain approval for the recombinant
insulins in Europe in 2012 and in the United States as soon as
2015, said David Simmons, president of Pfizer’s established
products business unit. Approvals for the other products will
come later in most markets.

“We believe we will be first to market in most if not all
the countries worldwide for each of the products in the
portfolio,” Simmons said in an interview.

Late-stage clinical trials are ongoing for the products.
Simmons said Pfizer would offer the insulins at a lower price
than the brands, but declined to specify the discount.

Emerging markets are a priority for Western drug companies
such as Pfizer, as they face slowing sales in their home
markets. Cheap off-patent drugs that can be sold in high
volumes under a multinational brand are an attractive market
opportunity.

Biocon will remain responsible for the clinical
development, manufacture and supply for the biosimilar insulin
products. It plans to invest $300 million over three years
starting in 2011 to expand capacity to produce biosimilar
drugs, its finance chief said.

Biocon, which was set up by Kiran Mazumdar-Shaw in her
garage in 1978 and which the market values at about $1.8
billion, has seen its stock skyrocket 46 percent this year,
outpacing the benchmark index’s 15.5 percent rise in the
period.

Pfizer’s shares were down about 6 cents at $17.68 in midday
trading on the New York Stock Exchange.
(Reporting by Lewis Krauskopf and Bharghavi Nagaraju; Editing
by Tony Munroe and Maureen Bavdek)

UPDATE 3-Pfizer to sell biosimilar insulins in Biocon deal