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Valeant sets sights on Eyetech

Offer for ophthalmology specialist follows failed bid to acquire Ista Pharmaceuticals

Valeant Pharmaceuticals has agreed to buy ophthalmology specialist Eyetech, shortly after failing to complete an offer for Ista Pharmaceuticals, and expects to close the deal later this week.

Canada-based Valeant has not disclosed the value of the offer for Eyetech, but said it includes an upfront payment and possible future milestones and in total would have a value "significantly less than two times [Eyetech's] sales."

Privately-held Eyetech sells anti-VEGF inhibitor Macugen (pegaptanib sodium) in the US for the treatment of wet age-related macular degeneration (AMD), a leading cause of blindness, while Pfizer has rights to the drug elsewhere.

"This acquisition of Eyetech will fit nicely with our existing ophthalmology business," said Valeant chief executive Michael Pearson.

Valeant's main eyecare products include a preservative-free formulation of Timoptic (timolol maleate) and dry eye treatment Lacrisert (hydroxy propyl cellulose ophthalmic insert), both of which were obtained from its $318m acquisition of Aton Pharma in 2010. 

The company has previously said it makes around $25m-$30m in ophthalmology sales a year. Neither Eyetech or Pfizer disclosed Macugen annual revenues.

Valeant withdrew its $7.50 per share offer for Ista late last month - with the promise of a hike to $8.50 - after the eyecare specialist had rejected an earlier $6.50 bid valuing the company at $314m.

The Canadian firm reportedly decided to withdraw the offer to avoid a bidding war, after Ista's management said it wanted to allow other companies access to its books.

Valeant was one of the busiest pharma companies involved in acquisitions last year, as featured in our report on major pharma deals during 2011,

14th February 2012

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