Bayer acquires Claritin and Afrin brands and other over-the-counter Merck business.
October 3, 2014
by Canadian Packaging Staff
Whitehouse Station, NJ—Merck, known as MSD outside the U.S. and Canada, has completed the sale of its Consumer Care (MCC) business to Bayer AG.
Effective, as of October 1, 2014, Bayer acquires Merck’s existing over-the-counter business, including the global trademark and prescription rights for Claritin and Afrin, $14.2 billion or approximately $9 billion in after-tax proceeds, less customary closing adjustments as well as certain contingent amounts held back that will be payable upon the manufacturing site transfer in Canada and regulatory approvals in Mexico and Korea.
“The proceeds from this sale, combined with our strong operating cash flow, give us greater flexibility to invest in opportunities that augment the company’s pipeline and product portfolio, such as the purchase of Idenix to strengthen our hepatitis C portfolio, while at the same time continuing to return capital to shareholders,” says Merck chairman and chief executive officer Kenneth C. Frazier.
In conjunction with this transaction, Merck has also entered into the previously announced worldwide collaboration between the companies to develop and commercialize soluble guanylate cyclase (sGC) modulators. This collaboration, effective today, includes Bayer’s Adempas (riociguat), the first in a novel class of compounds and the only treatment approved for both pulmonary arterial hypertension (PAH) and chronic thromboembolic pulmonary hypertension (CTEPH), as well as the investigational compound vericiguat that is currently in Phase 2 development.
The collaboration also includes opt-in rights for other early-stage sGC compounds in development by both companies. Merck will be making an upfront payment of $1 billion in connection with the sGC collaboration.
As previously communicated, the two companies will equally share certain costs and net sales for all products and candidates included in the collaboration, with additional milestone payments due upon the achievement of agreed-upon sales goals. For Adempas, Bayer will continue to lead commercialization in the Americas, while Merck will transition to lead commercialization in the rest of the world.
In order to preserve business continuity in markets outside of the Americas where Adempas is launching, Bayer will continue to provide commercialization support on behalf of Merck for a period of time. Working together, both companies will have the resources, capabilities and experience to realize the full potential of Adempas and the promising class of sGC modulation therapy.
For more on Merck, visit www.merck.com.