Merck to Sell Some Ophthalmology Assets

Merck & Co. Inc. has reached a deal to sell some ophthalmology assets to Santen Pharmaceutical Co. Ltd. for distribution in Japan as well as markets in the Asia Pacific region and Europe.

Merck will receive a $600 million upfront payment for the sale, as well as additional payments pegged to sales milestones. The deal is expected to close within a few months, Merck said.

The products, which focus on eye treatments and care, generate about $400 million in annual sales in the markets the deal covers, 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," Merck executive Jay Galeota said in a release.

The Whitehouse Station, N.J., company previously sold its U.S. ophthalmology business to Akorn Pharmaceuticals. It will continue to sell ophthalmology products in Latin America, Canada, Australia, the Middle East and Africa, among other markets.

Japan's Santen said it expects to use a combination of loans and cash to fund the deal, which it projects as adding to earnings starting in March 2015.

The deal comes amid a flurry of deal-making in the drug industry, including Merck's agreement earlier this month to sell its over-the-counter business to Bayer AG for $14.2 billion.

Write to Michael Calia at [e-mail]

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