Biocon Biologics, the fully integrated global biosimilars subsidiary of Biocon, has announced that S&P Global Ratings has upgraded the company’s long-term issuer credit rating to ‘BB+’ from ‘BB’, with the outlook revised to “Stable.”

The rating on senior secured notes issued by Biocon Biologics Global PLC was also upgraded to ‘BB+.’

This upgrade follows Biocon’s recent equity issuance to settle compulsorily convertible preference shares (CCPS) issued to Viatris Inc.

S&P Global cited several factors behind the move:

1. Simplified capital structure: “The company reduced its outstanding structured debt liabilities, and a US$1 billion CCPS issued to Viatris has now been removed through a mix of equity share swaps and cash consideration. Biocon funded the cash payout through fresh equity of about US$460 million that it raised earlier this month.”

2. Growth prospects: “New product launches and favorable industry trends will support Biocon's earnings. Pharmaceutical sector will continue to register healthy growth through 2027, especially for GLP-1s and treatment for oncology and rare diseases.”

3. Financial discipline: “Biocon's management remains committed to reverting its balance sheet position to levels before its acquisition of Viatris' biosimilars portfolio.”

The Viatris acquisition, completed in November 2022 for US$3.3 billion, had increased Biocon’s debt-to-EBITDA ratio to about 7x in fiscal 2024, up from about 2x in fiscal 2022. The stable outlook reflects S&P’s expectation of steady earnings growth over the next 12–24 months, driven by rising demand for generics and biosimilars in key international markets and new product launches.