About Anthem Biosciences Limited

BUSINESS OVERVIEW

Anthem Biosciences is an innovation-driven, technology-focused CRDMO (Contract Research, Development and Manufacturing Organization) with fully integrated capabilities across drug discovery, development, and commercial manufacturing. It is among the few Indian CRDMOs with end-to-end NCE (New Chemical Entity) and NBE (New Biological Entity) offerings, as per the F&S Report.

The company serves a global clientele comprising emerging biotech firms and large pharmaceutical companies. According to the F&S Report, it is the youngest and fastest-growing Indian CRDMO to achieve ₹10,000 million in revenue within 14 years (achieved in Fiscal 2021) and recorded the highest revenue growth in Fiscal 2024–2025 among assessed Indian and global peers.

Anthem operates in two segments:

• CRDMO services, catering to regulated markets.

• Specialty ingredients, serving both regulated and semi-regulated regions such as the US, Europe, India, Southeast Asia, Latin America, and the Middle East. This segment leverages its fermentation and chemistry capabilities to diversify revenue streams.

Over the past 15 years, Anthem has delivered over 8,000 projects for more than 675 customers, spanning all stages of the drug development lifecycle. In Fiscal 2025, it supported 10 commercialized molecules from discovery to API/intermediate manufacturing, with 5 of the top 6 revenue-generating molecules linked to 3 large pharma companies. These molecules had a combined end-market sales value of USD 11.3 billion in 2024, projected to grow at a CAGR of 13.5% to USD 21.4 billion by 2029.

As of March 31, 2025, the company managed 242 active projects, including:

• 68 discovery projects (355 molecules synthesized)

• 145 early-phase projects

• 16 late-phase projects

• 13 commercial manufacturing projects

According to the F&S Report, Anthem is one of only three Indian CRDMOs with expertise in ADCs, RNAi, peptides, and oligonucleotides, which are among the fastest-growing therapeutic modalities.

The company had 550+ customers across 44+ countries, including the United States, Europe, and Japan, with the highest customer count among Indian peers (F&S Report). Over 150 customers were served under the CRDMO segment alone. The top 5 customers contributed 70.92% of revenue in Fiscal 2025, with 5 of the top 6 clients maintaining 8+ year relationships (including post-merger continuity via DavosPharma).

To expand its U.S. presence, Anthem partnered with DavosPharma, an affiliate of shareholder Portsmouth LLC, established in 1972. Through this alliance, it onboarded 89 U.S. customers over three fiscals, including 83 emerging biotech firms. Under the agreement, DavosPharma acts as a sales and invoicing intermediary, accounting for 14.28% of total revenue in Fiscal 2025, ranking as the third-largest customer.

All manufacturing facilities are cGMP-compliant and accredited by global regulators including the US FDA, ANVISA (Brazil), TGA (Australia), and PMDA (Japan). The company is a pioneer in sustainable practices, adopting green chemistry methods such as biotransformation, micellar technology, pincer catalysis, and flow chemistry, contributing to cleaner reactions and cost efficiencies.

To mitigate supply chain risks, Anthem has strategically sourced domestic alternatives to reduce reliance on offshore suppliers, particularly from China. The comapny is supported by a team of more than 1,500 highly qualified employees with a science and/or engineering background in various departments across manufacturing, quality and R&D. The Bankers to the comapny are Citibank N.A. and HDFC Bank Limited.

INDUSTRY ANALYSIS

Overview of the Indian CRDMO Industry

India’s Contract Research, Development, and Manufacturing Organization (CRDMO) industry ranks among the fastest-growing globally, having expanded at a CAGR of 13.2% between 2019 and 2024. With its increasing strategic relevance in the Asia-Pacific (APAC) region, India is emerging as a preferred destination for pharmaceutical innovators. The sector is expected to maintain this momentum, growing at a CAGR of 13.4% from 2024 to 2029, to reach an estimated USD 15.4 billion by 2029. This growth rate surpasses the global average of 9.1% and even outpaces countries like China, bolstered by policy shifts such as the US BIOSECURE Act, which positions India as a more reliable outsourcing partner.

India’s ascent in the global pharma outsourcing landscape is underpinned by a combination of structural advantages, a well-established talent base, and a robust ecosystem of CRO (Contract Research Organizations) and CDMO (Contract Development and Manufacturing Organizations) players.

Market Performance: CRO and CDMO Segments

• The Indian CRO market has witnessed impressive growth, doubling from USD 1.0 billion in 2019 to USD 2.0 billion in 2024, reflecting a CAGR of 15.1%. It is projected to reach USD 3.6 billion by 2029.

• The Indian CDMO market grew at a CAGR of 12.6%, reaching USD 6.2 billion in 2024, and is expected to climb to USD 11.8 billion by 2029.

Modality Breakdown: Small vs Large Molecules

India's CRDMO industry continues to be dominated by small molecules, accounting for over 92% of the total market in 2024. However, biologics (large molecules) are steadily gaining ground due to their relatively higher growth rate. This segment is expected to play an increasingly important role in the coming years as Indian players enhance their capabilities in biologics development and manufacturing.

Functional Analysis: Development and Commercial Manufacturing

In terms of functional contributions within the value chain:

• Development and commercial manufacturing together comprised 76.8% of the Indian CRDMO market in 2024.

• These segments are projected to grow at CAGRs of 14.9% and 12.8%, respectively, from 2024 to 2029.

The robust growth in these areas is attributed to significant advancements in the technical and process capabilities of Indian CRDMOs, which are increasingly being recognized by global pharmaceutical companies. Additionally, Indian firms are expanding their integrated service offerings, with a rising focus on complex therapeutic areas, particularly in biologics.

BUSINESS STRENGTHS

1. Comprehensive CRDMO Capabilities Across Drug Lifecycle
Anthem Biosciences offers end-to-end CRDMO services across NCE and NBE lifecycles, covering drug discovery, development, and commercial manufacturing for both small molecules and biologics. According to the F&S Report, it is the only assessed Indian CRDMO with robust capabilities in both modalities.

2. Innovation-Led Technology Platform
The company has built advanced technological competencies including RNAi, ADCs, peptides, lipids, and oligonucleotides, along with custom synthesis, fermentation, flow chemistry, and biotransformation. It is recognized as a pioneer in India for introducing biotransformation (2014) and flow chemistry (2019), and adopting green chemistry techniques such as micellar technology and pincer catalysis.

3. Differentiated Business Model Targeting Emerging Biotech
With a focus on small and emerging biotech companies, Anthem supports clients from early discovery through to commercial manufacturing. These companies are growing faster than large pharma, driven by innovation and venture funding, and increasingly rely on outsourced CRDMO partners to overcome R&D and scale-up challenges.

4. Diversified Customer Base with Long-Term Relationships
The company serves a wide spectrum of clients, including small biotech, large pharma (e.g., Bayer AG), and mid-sized innovators. It has a large and loyal global customer base, with long-standing relationships and a presence across over 44 countries.

5. Strong Specialty Ingredients Portfolio
The specialty ingredients business complements CRDMO operations and includes GLP-1, biosimilars, enzymes, probiotics, nutritional actives, and vitamin analogues. In Fiscal 2025, this segment contributed ₹3,384.60 million to revenue, offering a diversified income stream.

6. Scalable and Compliant Manufacturing Infrastructure
Anthem operates two cGMP-compliant facilities (Units I & II) with a custom synthesis capacity of 270 kL and India’s largest fermentation capacity of 142 kL among peers (as of March 31, 2025). Ongoing expansion includes Unit III and an additional 130 kL at Unit II, expected to complete by H1 FY2026.

7. Industry-Leading Growth and Capital Efficiency
Recognized as the fastest-growing Indian CRDMO among assessed peers (F&S Report), the company reached ₹10,000 million in revenue in just 14 years (Fiscal 2021). It achieved strong profitability and capital efficiency between Fiscal 2023 and Fiscal 2024, establishing itself as a benchmark in the Indian CRDMO space.

8. Experienced Leadership and Scientific Talent Pool
Led by seasoned professionals including CEO Ajay Bhardwaj (40+ years), COO K. Ravindra Chandrappa (25+ years), and CSO Dr. Ganesh Sambasivam, the leadership team combines deep domain knowledge in life sciences, research, and development. The board includes industry veterans across science, automation, manufacturing, and finance.

BUSINESS STRATEGIES

1. Strengthen Technological Capabilities to Expand Discovery and Development Pipeline
Plans include enhancing capabilities in photochemistry and electrosynthesis, offering greener, cost-efficient synthesis alternatives. These advancements aim to attract new customers and increase engagement across the discovery and development phases, especially in modalities like RNAi, ADCs, peptides, and oligonucleotides. The focus remains on building long-term partnerships with biotech and pharma companies early in the drug lifecycle.

2. Scale Manufacturing to Serve Late-Stage and Commercial Molecules
With development and manufacturing expected to grow at CAGRs of 9.5% and 7.5% (2024–2029) globally, the strategy is to leverage current and expanding manufacturing capacity to meet growing demand for commercialized and late-stage molecules. Notably, 5 of the top 6 commercialized molecules manufactured in Fiscal 2025 are projected to grow to USD 21.4 billion in end-market sales by 2029.

3. Expand Complex Specialty Ingredients Business
Targets increased engagement with large pharmaceutical companies for high-value niche products such as probiotics and biosimilars. Two contracts are currently active—one with an Indian pharma company for probiotics, and another with a U.S. firm for a biosimilar. Focus is on scalable products with consistent demand, enabling long-term, stable revenue streams.

4. Enhance Cost Efficiency and Supply Chain Resilience
Operational improvements will continue through increased use of renewable energy, green chemistry practices (e.g., biotransformation, flow chemistry), and resource optimization. Emphasis is on margin-accretive contracts, such as fee-for-service (FFS) projects and specialty ingredient manufacturing.

5. Pursue Inorganic Growth Opportunities
Future expansion includes identifying strategic acquisitions and partnerships aligned with core competencies in biosynthesis, enzymatic processes, and flow chemistry, focusing on high-margin, low-volume technical projects.

6. Deepen Sustainable Manufacturing Practices
The strategy includes further adoption of renewable energy, green manufacturing technologies, and waste reduction initiatives. As of Fiscal 2024, the company recorded the lowest GHG intensity (₹1.24 tCO₂e/million) among assessed Indian peers. New initiatives include photochemistry and electrosynthesis, which reduce reliance on hazardous reagents and improve synthesis efficiency.

7. Expand Renewable Energy Use
As of March 31, 2025, energy is sourced through 4 contracts totaling 10.00 MW wind and 26.74 MW solar power, reinforcing the commitment to low-emission, cost-effective operations.

BUSINESS RISK FACTORS & CONCERNS

1. High Dependence on CRDMO Services
CRDMO services contributed 81.65% of revenue in Fiscal 2025. Any downturn in client businesses or the broader pharmaceutical industry may materially impact operations.

2. Customer Base Fluctuations
As of March 31, 2025, Anthem served 169 CRDMO customers, including 145 small pharma and biotech firms. Customer count decreased in Fiscal 2024 and rebounded in 2025. There is no guarantee of maintaining or expanding the customer base in the future.

3. Revenue Sensitivity to Molecule Success
Revenue is significantly tied to the success of molecules in development and commercialization. A failed Phase III trial and a withdrawn product contributed to revenue decline in Fiscal 2023. Discontinuation or delay in molecule progression can reduce order volumes and profitability.

4. Dependency on DavosPharma in the U.S. Market
DavosPharma, an affiliate of a shareholder, manages logistics and customer coordination in the U.S. It accounted for 14.28% of revenue in Fiscal 2025. Any disruption in this relationship could adversely affect U.S. business operations. Under tripartite contracts, Anthem may also be liable for DavosPharma’s non-performance.

5. Patent Expiry Risk
A portion of revenue is derived from commercial manufacturing of patented molecules. Post-patent expiry, the emergence of lower-cost alternatives may result in revenue loss.

6. Operational Risk from Facility Disruptions
Operations rely on Units I and II, with Unit III under phased commissioning as of March 2025. Delays in expansion at Unit II and construction of Unit III, partly due to equipment procurement issues, may result in increased costs and lost revenues.

7. Reputational Risk from Animal Testing
Preclinical trials involve animal testing on various species, compliant with Indian regulations. Despite legal adherence, there is a risk of adverse publicity, protests, or operational disruptions from anti-animal testing activism.

Anthem Biosciences faces business risks related to the concentration of revenue from CRDMO services, dependency on specific customers and molecules, reliance on key partnerships, exposure to regulatory and operational challenges, patent expiry risks, facility disruptions, and reputational concerns related to animal testing. These risks may adversely impact financial performance, customer retention, and future growth.