Viatris to buy two eye drug developers in deals worth up to $750M
Pharmaceutical company Viatris will acquire the eye disease drug developers Oyster Point Pharma and Famy Life Sciences in separate deals announced Monday. Together, the acquisitions will cost Viatris between $700 million and $750 million, which the generics drugmaker plans to pay with cash it has on hand.
Under the first deal, Viatris will purchase Oyster Point shares at $11 apiece and pledged another $2 per share in a contingent value right that pays out if certain milestones are met. Including debt, the deal is worth about $424 million. The acquisition of privately held Famy will cost Viatris $281 million.
Viatris expects the two deals to establish an ophthalmology division that will generate more than $1 billion in additional sales by 2028, helping the company to manage eroding revenue in its core business.
Viatris was created through a 2019 merger between Pfizer’s generic drug unit, Upjohn, and the struggling generics maker Mylan. It has been working since to stabilize a declining business and position itself for growth in the future.
Like other generic drugmakers, the company has taken to restructuring and consolidation. In February, for example, Viatris sold its biosimilars business to partner Biocon for up to $3.3 billion in an effort to raise cash.
The company is also investing in ophthalmology, which it has identified as “one of the key therapeutic areas of focus.”
Oyster Point brings to Viatris a nasal spray treatment for dry eye disease that won Food and Drug Administration approval last year. The company also has another nasal spray in Phase 2 testing and two other candidates in preclinical testing.
Famy will further add to Viatris’ opthalmology portfolio with products in development for dry eye, blepharitis and presbyopia.
“While it remains to be seen if the $1B target will prove to be an aggressive goal, we are encouraged by steps being taken to return the business to top line growth,” wrote Glen Santangelo, an analyst at Jefferies, in a Monday note to clients.
The acquisition of Oyster Point is expected to close in the first quarter of 2023, at which point Viatris also expects to complete the Famy transaction.
The ophthalmology segment will operate as a separate division within Viatris and be led by Oyster Point CEO Jeffrey Nau.
Published Nov. 8, 2022
