Novartis has agreed to sell several of its eye-care products to Bausch + Lomb in a deal worth up to $2.5bn, including an upfront cash payment of $1.75bn.
The transaction includes the Swiss drugmaker’s non-steroid, anti-inflammatory eye drop Xiidra (lifitegrast ophthalmic solution), which is specifically approved to treat the signs and symptoms of dry eye disease (DED).
DED is among one of the most common ocular surface disorders, affecting approximately 38 million people in the US and around 739 million people worldwide.
Bausch said the acquisition of Xiidra would complement its existing dry eye portfolio that currently features Miebo (perfluorohexyloctane ophthalmic solution), which was recently approved in the US for DED.
As part of the deal, Bausch will also acquire Novartis’ investigational drug libvatrep (also known as SAF312) for chronic ocular surface pain, as well rights to use its AcuStream dry-eye drug delivery device.
Under the terms of the agreement, which is expected to close in the second half of this year, Novartis will receive milestone payments up to $750m linked to anticipated future sales.
Ronny Gal, chief strategy and growth officer of Novartis, said: “Our ongoing portfolio refinement enables us to best deploy our scientific expertise and resources towards priority programmes and therapeutic areas, while remaining open to opportunistic development for additional high impact conditions leveraging our advanced technology platforms.
“We believe that Bausch + Lomb has the capabilities, scale and commitment to continue the work of Novartis in delivering and developing much needed therapies for patients suffering from dry eye and related conditions.”
Novartis said it would continue to supply Xiidra on behalf of Bausch + Lomb for a “limited period” after the deal closes to ensure consistent supply to patients.
Brent Saunders, chairman and chief executive officer of Bausch + Lomb, said the acquisition would transform the company’s pharmaceuticals business by making it “a leader in ocular surface diseases”.
“The deal is also expected to accelerate margin expansion through a larger mix of pharmaceutical products in our portfolio, provide strong and immediate earnings accretion and presents a clear path to deleverage, making it financially compelling,” Saunders said.