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Valeant to buy B+L for $8.7 billion

Published on 29/05/13 at 06:41pm

Canadian firm Valeant Pharmaceuticals International is to buy Bausch + Lomb in an $8.7 billion deal which will see the eye care giant retain its famous name.

It will become a division of Valeant, which will in turn absorb Valeant’s existing ophthalmology businesses, creating an entity with an estimated $3.5 billion net revenue this year.

Valeant cites “growing eye health trends driven by an ageing patient population, an increased rate of diabetes and demand from emerging markets” as the raison d’etre for making its move.

It also gives Valeant access to a product portfolio in three parts: pharma (which includes prescription brands, generics and OTC, vision care (contact lenses and solutions) and surgical (intraocular lenses and surgical equipment). 

Valeant will pay $8.7 billion in cash, which is made up of $4.5 billion for an investor group led by Warburg Pincus and $4.2 billion to repay Bausch + Lomb’s outstanding debt. 

The transaction is expected to go through in the third quarter of the year and Valeant expects it will make ‘at least’ $800 million in annual cost savings by end of 2014.

Valeant chief executive J. Michael Pearson said it will “transform Valeant into a global leader in eye health by significantly strengthening our capabilities in ophthalmic pharmaceuticals, contact lenses and lens care products, and ophthalmic surgical devices and instruments”.

Meanwhile, Bausch + Lomb’s chief executive Brent Saunders said: “We introduced innovative new products for patients, built a robust pipeline, expanded into new markets and strengthened our relationships with eye care professionals around the world.”

He will join Valeant in an advisory role while Bausch + Lomb’s chairman Fred Hassan will join Valeant’s board of directors.

Two of the US company’s senior executives, global pharma president Dan Wechsler and chief medical officer Calvin Roberts, will also be installed in Valeant as executive vice president and company group chairman and chief medical officer, ophthalmology and eye health, respectively.

“We also anticipate additional members of the senior management team to join Valeant,” the company says in a statement.

Bausch + Lomb’s prescription and OTC brands include Besivance, Lotemax, Ocuvite and PreserVision.

Adam Hill

 

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