Pharmaceutical companies Aerie and Alcon have announced that they have joined hands in a merger agreement according to which Aerie will be acquired by Alcon. According to Alcon, the merger will broaden its R&D capabilities and add significantly to maximize its portfolio worth. Acquisition has cost Alcon approximately $753M.
This agreement will enable Swiss eyecare company Alcon to add the U.S. pharma company Aerie’s commercial products like netarsudil ophthalmic solution (Rhopressa) 0.02%, netarsudil and latanoprost ophthalmic solution (Rocklatan) 0.02%/0.05%, and also a Phase 3 candidate used for dry eye disease called AR-15512 to its pipeline. Additionally, Alcon would add a channel of numerous preclinical and clinical ophthalmic pharma product candidates.
The acquisition adds to Alcon’s entrance into the ophthalmic pharmaceutical eye drop market which already includes U.S. commercialization rights to Novartis’ Simbrinza as well as Inveltys and Eysuvis from Kala Pharma Inc., which were acquired in April 2021 and May 2022 respectively.
CEO of Alcon, David Endicott said “Alcon is passionate about innovative treatments in eye care, especially in core disorders such as glaucoma and dry eye, which have significant patient impact. We have a 75-year history focused specifically on the eye and bring established expertise in development and commercial execution. As we continue to broaden our portfolio across glaucoma, retina and ocular surface disease, we are excited to help even more patients see brilliantly.”
Aerie Pharmaceutical Inc. is looking forward to become a part of the Alcon family, according to its CEO Raj Kannan. He mentioned that Alcon is the perfect partner to maximize Aerie’s potential and improve its products’ accessibility. Kannan was also confident that the merger is the best decision for the shareholders and also for the patients.
The news release reported that the $15.25 purchase price offered by Alcon denotes a healthy premium of 37% compared to the company’s last closing price and signifies almost $770M in equity value. The transaction value was based on Aerie’s outstanding shares which were 49.36M as of August 2022. Board of directors of both companies approved the merger.
The latest financial guidance for total glaucoma franchise net product revenue is between $130M and $140M for the year 2022. The merger’s benefit is predicted to slowly translate into Alcon’s core diluted EPS (Earning Per Share) in 2024. The agreement is expected to close by the last quarter of 2022, depending on Aerie stockholders’ approval as well as Hart-Scott Rodino Antitrust Improvements Act. Alcon aims to use long-term and short-term debt to fund the Aerie acquisition.
Alcon’s financial advisor in the agreement was J.P. Morgan while Goldman Sachs & Co. LLC filled the role for Aerie. Legal advisor for Alcon was Skadden, Arps, Slate, Meagher & Flom LLP, while the same role was played by Fried, Frank, Harris, Shriver & Jacobson LLP for Aerie.
Alcon acquired U.S. eye surgery organization Ivantis for about $475M in November last year and this acquisition of Aerie will further its aim to boost its eyecare portfolio and capabilities.
