Merck Divests Ophthalmology Business To Santen Pharmaceutical
By Cyndi Root
Merck announced in a press release that it is continuing to divest itself of its ophthalmology business and has sold some of the rights to Santen Pharmaceutical for marketing in Japan, Europe, and Asia Pacific. Santen will make an upfront payment to Merck, along with milestone payments, and payments for products.
In 2013, Merck sold its ophthalmology business in the U.S. to Akorn Pharmaceuticals. Merck retains ophthalmology products and marketing rights in Latin America, Canada, Australia, the Middle East, and Africa.
Jay Galeota, President of Hospital and Specialty Care at Merck said, “The decision to divest our ophthalmics business is part of our ongoing strategy to sharpen our commercial focus and improve our operational effectiveness. This transaction provides products that complement Santen’s portfolio.”
Merck and Santen Agreement
Santen has agreed to pay about $600 million upfront for the marketing rights. It will make milestone payments based on sales and pay Merck for products in the next two to five years. Merck estimates a generous return on Santen’s investment as ophthalmology products, within the scope of the agreement in those defined markets, are worth approximately $400 million annually. Subject to regulatory approval in Japan, the deal is expected to close in a few months.
Merck’s Ophthalmology Products
Merck has signed over several of its products to Santen. They include Cosopt (dorzolamide hydrochloride – timolol maleate ophthalmic solution), Trusopt (dorzolamide hydrochloride ophthalmic solution), Timoptic (timolol maleate ophthalmic solution), Saflutan (tafluprost), and Taptiqom (tafluprost-timolol maleate ophthalmic solution, which is in development).
Akorn Pharmaceuticals
Merck sold its U.S. ophthalmology business to Akorn Pharmaceuticals in November of 2013. Akorn acquired the AzaSite and Cosopt brands for U.S. distribution. The purchase improved Akorn’s standing with prescribers and leveraged sales of its own product line. Additionally, the purchase positioned Akorn to make additional ophthalmic acquisitions in the future. Akorn has recently acquired other assets including the VersaPharm and Hi‐Tech Pharmacal companies.
Ophthalmology Market
Market Research, an analysis company, published a report detailing the Ophthalmology market to 2016. The authors stated that in 2011, the market was valued at $16 billion globally, with a CAGR of 4.6 percent to 2016. Glaucoma treatment leads the market, with sales of $5.6 billion in 2010. Retinal disease treatment for age-related macular degeneration (AMD), diabetic retinopathy (DR), diabetic macular edema (DME), and retinal vein occlusion (RVO) is expected to grow the fastest. Dry eye syndrome (DES) is increasing due to increased computer use.