New Actavis / Bioton alliance to shake up diabetes market

1/30/2012, 11:31 AM (Source: GlobeNewswire)
Global managed-care offering to help bring down treatment costs for 366 million

Warsaw, Poland, 30 January 2012 - Actavis and Bioton (WSE:BIO) announced today
that they have formed a joint venture company for the development and
registration of insulins, including analogue insulins. Within the framework of
the joint-venture, Bioton will be responsible for the development and
manufacture of insulin products, while Actavis will be granted an exclusive
licence to commercialise those products under the Actavis brand throughout the
European Union and the United States of America, as well as in Albania, Bosnia &
Herzegovina, Croatia, Iceland, Japan, Kosovo, Lichtenstein, Macedonia,
Montenegro, Norway, Serbia and Switzerland. In Poland, both companies will offer
the insulin products under their respective brands, Bioton being a Polish

The announcement, at a press conference in Warsaw today, was made jointly by
Ryszard Krauze, Chairman of the Supervisory Board of Bioton, and Claudio
Albrecht, CEO of the Actavis Group and Chairman of the Actavis Board of

Actavis has agreed to remunerate Bioton with the aggregate amount of EUR 55.5
million, of which EUR 22.25 million at signing today. The remainder (EUR 33.25
million) will be paid in instalments in accordance with agreed milestones
relating to the registration process involving recombined human insulin (RHI).

Based on the sales volumes estimated by the parties, Actavis' revenues from the
sale of the Insulins by Actavis into the markets in the initial period of 7
years from launch are expected to exceed EUR 1.5 billion. Pursuant to the
agreement, the parties will share on an equal '50/50' basis the profits from the
sale of the insulins performed by Actavis, as well as the development and
registration costs related to Bioton insulins.

In addition to the above, the Bioton Group have also signed memoranda of
understanding with Actavis for the sale of insulins in 24 additional
territories, including Turkey and Australia. Actavis will pay an additional
consideration of up to EUR 1,900,000, including EUR 1,000,000 at signing. Both
parties expect that sales of Bioton's recombinant human insulin by Actavis into
some of the additional territories shall commence on the turn of 2012 and 2013.
The profits from the sale of the insulins in these additional territories will
again be shared on an equal basis (50/50). Formal documentation of these
arrangements is expected to be concluded in the following weeks.

Actavis CEO Claudio Albrecht believes the new alliance will create tremendous
value for Actavis and Bioton and their respective shareholders.
"The recombinant- and analogue insulins alone should add around EUR 900 million
(USD 1.2 billion) to our enterprise value. Thanks to the collaboration agreement
with Bioton, we will be among the leading manufacturers of insulin, including
analogue insulins," predicted Albrecht.

Chairman of the Supervisory Board of Bioton S.A. Ryszard Krauze commented, "The
cooperation with Actavis has a strategic importance for Bioton. We will jointly
introduce modern insulins, including analogue insulins. For the last two years,
we have been consistently increasing the sales of our products based on
collaborations with leading global pharmaceutical firms such as Bayer HealthCare
in China and GlaxoSmithKline in Russia. Today, we are pleased to welcome another
large pharmaceutical firm to our group of partners - Actavis."

New data released by the International Diabetes Federation (IDF) indicates that
more than 366 million people worldwide are living with diabetes. Due to poor
diet and sedentary lifestyles, diabetes is rapidly becoming a global epidemic,
and the number of diabetes patients is expected to rise to a figure in excess of
550 million by 2030. The World Health Organisation (WHO) projects that the
global insulin market will grow from the present level of approximately USD 14
billion to USD 54 billion over that same period.

On average, a patient with diabetes type 2 takes almost 30 different medicines
over the course of the disease. In light of that fact, the collaboration with
Bioton represents a more fundamental and strategic concept in terms of treating
diabetes, according to Claudio Albrecht.

"The diabetes idea for us is a much wider one than just promotion and sale of
recombinant human insulin or insulin analogues", he said. "We are encountering
competitor giants when it comes to insulin and we have to maximise the
competitive advantages that we clearly have. Bioton's insulin products have a
market presence of more than 10 years' standing, with an excellent safety and
efficacy profile. This puts us in a situation where we can overcome more easily
any potential doubts that key opinion leaders might have when it comes to

"Furthermore, we differ in one aspect very strongly in comparison with the
originators," Albrecht added, highlighting the extensive range of generic type-
2 oral diabetes drugs that Actavis already offers. Actavis' pipeline also
includes high-value 'gliptin' products" and several fixed dose combinations with

Albrecht noted that the opportunity to market a much broader portfolio in the
context of diseases related to diabetes is a great one. "Actavis is the only
company that can offer such a broad diabetes- and related diseases portfolio. We
can tell payers that we cover the whole diabetes segment for a cost that is
probably considerably less than they have been paying to date."

CEO of Bioton SA Slawomir Ziegert said, "For Bioton, the collaboration with
Actavis will, in addition to bringing direct financial benefits, fuel faster
expansion into high-margin markets, while supporting the implementation of our
product synergy strategy and further growth in the area of cardio diabetology.
Patients value highly the unique and comprehensive care offered by Bioton, a
package which includes insulin, injectors, glucometers, oral diabetes medicines
and an educational programme. All these elements provide an opportunity to
extend our collaboration with Actavis in many markets around the world."

About Actavis Group
Actavis is one of the world's leading generic pharmaceutical companies,
specialising in the development, manufacture and sale of generic
pharmaceuticals. The company has operations in more than 40 countries, with over
10,000 employees. At present, the Actavis Group has a portfolio, which includes
approximately 830 medicines present on the market and registered in more than
70 countries. For further information on Actavis Group, please visit

About Bioton
Bioton is the Polish manufacturer of modern recombinant human insulin, which is
on offer to patients on almost 20 markets worldwide, including Poland, Russia,
China, Thailand, Vietnam and India. With respect to the sale of insulins, Bioton
cooperates with GlaxoSmithKline and Bayer HealthCare, as well as other local
foreign distributors, leading on particular markets. Bioton's insulin are
manufactured in a modern biotechnology facility in Macierzysz near Warsaw. In
addition to insulins, Bioton offers to patients also own-brand injectors for
administration of insulin and a range of other medicines used in the treatment
of diabetes and other metabolic disorders. Currently Bioton also is seeking
registration in the European Union of a new sustained release growth hormone
developed in collaboration with LG Life Science.


Actavis Group
Frank Staud
EVP Corporate Communication
Tel: +41 79 230 95 78

Any statements contained in this press release that refer to Actavis' and
Bioton' estimated or anticipated future results or future activities are
forward-looking statements which reflect Actavis' and Bioton'  current analysis
of existing trends, information and plans. These forward-looking statements are
subject to a number of risks and uncertainties that could cause actual
results to differ materially depending on factors such as the availability of
resources, the timing and effect of regulatory actions, the success of new
products, the strength of competition, the success of research and development
issues, unexpected contract breaches or terminations, exposure to product
liability and other lawsuits, the effect of currency fluctuations and other

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