Munich – Formycon AG, the German biosimilars company which in December 2013 licensed out its first product candidate to Santo Holding GmbH, has reported positive financial results in line with expectations. For the first nine months of 2014, the company posted revenues of EUR 8.98 million (2013: EUR 0.33 million). Its operating profitability likewise improved markedly, with EBITDA of EUR 2.64 million for the period from January through the end of September. In the same period last year, the company had posted an EBITDA loss of EUR 4.33 million.

In terms of net income, the company earned EUR 1.81 million for the first nine months. During the same period in 2013, the company had reported a loss of EUR 5.16 million. Formycon has, moreover, confirmed its expectation for ending the fiscal year with positive EBITDA. The company’s total liquidity (including credit balances with banks, cash, checks and marketable securities) as of the end of September was EUR 10.44 million, compared to EUR 3.11 million at the same time last year.

Operational work continues as planned on the company’s three currently pending biosimilar projects, with each project advancing in line with its respective development schedule. As a developer of biosimilar drugs, Formycon is benefiting from the explosion of interest from the pharmaceutical industry in the so-called “third wave” of biosimilars, biotech drugs which replicate existing biopharmaceuticals, and is thus in discussions with a number of pharmaceutical corporations and generic drug producers about further development projects.

Background: What are biosimilars?
Since their introduction in the 1980s, biopharmaceuticals have revolutionized the treatment of diseases such as cancer, diabetes, rheumatoid arthritis and multiple sclerosis. In the coming years, many of the patents for these biotech drugs will expire – and by the year 2020, medications with revenues of more than USD 100 billion will lose their patent protection. In this way, it will become possible to launch new competing drugs, known as “biosimilars”. While the global market for these new-generation drugs is currently some USD 2.5 billion, industry experts expect this figure to grow tenfold by the year 2020. In contrast to traditional generic drugs, the development and production of biosimilars is highly complex and requires specialized expertise.