Merck Completes Sale of Consumer Care Business to Bayer AG for $14.2 Billion
October 01 2014 - 11:30AM
Business Wire
Worldwide Collaboration to Market and
Develop Portfolio of Soluble Guanylate Cyclase (sGC) Modulators
Commences
Merck (NYSE:MRK), known as MSD outside the United States and
Canada, said today it has completed the previously announced sale
of the Merck Consumer Care (MCC) business to Bayer AG. Effective
today, Bayer will acquire Merck’s existing over-the-counter
business, including the global trademark and prescription rights
for CLARITINTM and AFRINTM, for $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,” said Kenneth C. Frazier, chairman and chief
executive officer, Merck.
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 ADEMPASTM (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 ADEMPASTM,
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 ADEMPASTM 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 ADEMPASTM and the promising class of sGC modulation
therapy.
About Merck
Today's Merck is a global healthcare leader working to help the
world be well. Merck is known as MSD outside the United States and
Canada. Through our prescription medicines, vaccines, biologic
therapies and animal health products, we work with customers and
operate in more than 140 countries to deliver innovative health
solutions. We also demonstrate our commitment to increasing access
to healthcare through far-reaching policies, programs and
partnerships. For more information, visit www.merck.com and connect
with us on Twitter, Facebook and YouTube.
Forward-Looking Statement
This news release includes “forward-looking statements” within
the meaning of the safe harbor provisions of the United States
Private Securities Litigation Reform Act of 1995. These statements
are based upon the current beliefs and expectations of Merck’s
management and are subject to significant risks and uncertainties.
There can be no guarantees with respect to pipeline products that
the products will receive the necessary regulatory approvals or
that they will prove to be commercially successful. If underlying
assumptions prove inaccurate or risks or uncertainties materialize,
actual results may differ materially from those set forth in the
forward-looking statements.
Risks and uncertainties include but are not limited to, general
industry conditions and competition; general economic factors,
including interest rate and currency exchange rate fluctuations;
the impact of pharmaceutical industry regulation and health care
legislation in the United States and internationally; global trends
toward health care cost containment; technological advances, new
products and patents attained by competitors; challenges inherent
in new product development, including obtaining regulatory
approval; Merck’s ability to accurately predict future market
conditions; manufacturing difficulties or delays; financial
instability of international economies and sovereign risk;
dependence on the effectiveness of Merck’s patents and other
protections for innovative products; the exposure to litigation,
including patent litigation, and/or regulatory actions.
Merck undertakes no obligation to publicly update any
forward-looking statement, whether as a result of new information,
future events or otherwise. Additional factors that could cause
results to differ materially from those described in the
forward-looking statements can be found in Merck’s 2013 Annual
Report on Form 10-K and the company’s other filings with the SEC
available at the SEC’s Internet site (www.sec.gov).
MerckMedia:Pamela Eisele, 267-305-3558Steve Cragle,
908-423-3461Investor:Joe Romanelli, 908-423-5185Justin Holko,
908-423-5088
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