Merck sells some eye-drug assets to Japan's Santen Pharma for $600M

The dealmaking continues in the red-hot market for eye care products with news today that Merck ($MRK) is offloading some of its ophthalmology products to Japan-based Santen Pharmaceutical. Santen will pick up 8 products, plus one that's in development, for marketing in Japan and key areas of Europe and the Asia Pacific region, according to a Merck press release. Santen will make an up-front payment of $600 million and milestone payments that were not specified.

The move is the latest by Merck to refocus its business on boosting its biopharmaceutical pipeline. Last week it agreed to sell off its consumer health unit to Bayer for $14.2 billion. And it had already been paring down its presence in ophthalmology, divesting its U.S. eye-care business to Akorn Pharmaceuticals ($AKRX) starting in 2013.

"The decision to divest our ophthalmics business is part of our ongoing strategy to sharpen our commercial focus and improve our operational effectiveness," said Jay Galeota, president of Merck's hospital and specialty care unit in the release.

Santen isn't the only company lining up to buy eye-care assets. Last summer, Akorn bought rival Hi-Tech Pharmacal ($HITK) for $640 million, picking up generic versions of Merck's glaucoma treatments Cosopt and Trusopt. (Akorn bulked up again yesterday, buying specialty pharma company VersaPharm for $440 million.) And Valeant ($VRX) picked up Eyetech in 2012, then turned around and bought eye-products giant Bausch + Lomb for $8.7 billion last year.

In today's deal, Santen will gain Japan and Europe rights to Cosopt and Trusopt, as well as Timoptic and Saflutan to treat ocular hypertension and glaucoma. The products bring in about $400 million in sales in the regions covered by the deal, Merck said.

- here's the press release
- read the WSJ story (sub. req.)
- here's Bloomberg's take

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