Newspaper article International New York Times

Bayer to Buy Consumer Unit from Merck ; Drug Makers Also Agree to Co-Develop and Market Cardiovascular Treatments

Newspaper article International New York Times

Bayer to Buy Consumer Unit from Merck ; Drug Makers Also Agree to Co-Develop and Market Cardiovascular Treatments

Article excerpt

The deal will make Bayer one of the largest providers of over- the-counter products, giving it control of brands like Claritin, Coppertone and Dr. Scholl's.

The German drug maker Bayer said Tuesday that it had agreed to acquire Merck's consumer care business for $14.2 billion.

The deal will make Bayer one of the largest providers of over- the-counter products, giving it control of several well-known brands including Claritin, Coppertone and Dr. Scholl's.

Had the acquisition already taken place, revenue from the company's businesses in 2013 would have amounted to 5.5 billion euros, or about $7.7 billion.

On Tuesday, Bayer also entered into a co-development and commercialization agreement with Merck related to the treatment of cardiovascular diseases. Merck will make an initial payment to Bayer of $1 billion as part of the agreement, to be followed by additional payments of up to $1.1 billion for achieving sales milestones.

"This acquisition marks a major milestone on our path towards global leadership in the attractive nonprescription medicines business," said Marijn E. Dekkers, the chief executive of Bayer.

The purchase price of $14.2 billion includes a payment related to the sales of Claritin and Afrin in countries where those drugs are available only by prescription.

The deal is the latest in a series of blockbuster transactions in the pharmaceutical industry this year as drug makers look to bolster their product lines or shed underperforming assets in nonessential business lines.

Last month, the Swiss pharmaceutical giant Novartis and GlaxoSmithKline of Britain agreed to swap more than $20 billion in assets, including the combination of Novartis's over-the-counter business with Glaxo's consumer drug business.

The combined Novartis-Glaxo consumer business would be a potential rival to Bayer's over-the-counter business after the Merck transaction, with products that include Novartis's Excedrin pain reliever and Maalox antacid, and Glaxo's Aquafresh toothpaste and Nicorette gum. …

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