Indian drugmaker Biocon Ltd is in talks with generic drugmaker Mylan for a merger of their biosimilar businesses, financial news website Moneycontrol reported on Thursday, citing sources with direct knowledge of the matter.

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Biocon will seek to hold a controlling majority stake in the merged entity and the companies will also look for an initial public offering (IPO) for the entity post-merger in which they will seek a valuation of over $10 billion, the report said.

Spokespersons for Biocon and Viatris Inc, the company which was formed after combining Mylan with Pfizer Inc`s off-patent branded drugs business, said that the companies do not comment on market rumours and speculation.

Biocon`s biosimilar business, Biocon Biologics, and Viatris already have an extensive collaboration agreement under which they develop, manufacture and commercialise a broad portfolio of biosimilars and diabetes generic drugs including insulin injection Semglee.

In September, Biocon said the biosimilar unit will sell a 15% stake to a Serum Institute of India subsidiary for access to millions of vaccine doses, including COVID-19 shots. The deal valued Biocon Biologics at about $4.9 billion.

Biocon Biologics has also raised capital through several rounds this year and last year from high-profile names such as Abu Dhabi-based ADQ, Goldman Sachs and Tata Capital Growth Fund.