Aerie Pharmaceuticals to Merge with Global Eye-Care Company Alcon

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Durham-based Aerie Pharmaceuticals, a developer of therapies for eye diseases, will be acquired by Alcon, the world’s largest eye-care devices company, for about $770 million following a definitive merger agreement.

Alcon said the transaction would broaden its pharmaceutical R&D capabilities and build on its commercial expertise in the estimated $20 billion global ophthalmic pharmaceutical market.

The merger will give Alcon two commercial products developed by Aerie, Rocklatan and Rhopressa, both eye-drop medicines for reducing high intraocular pressure in patients with open-angle glaucoma or ocular hypertension. Alcon will also gain a product candidate for dry eye disease that is in Phase 3 clinical trials, as well as a pipeline of other clinical and preclinical ophthalmic pharmaceutical product candidates.

“Alcon is the right strategic and financial partner to maximize the potential of Aerie’s commercial franchise and our growing portfolio of pipeline assets,” said Raj Kannan, chief executive officer of Aerie. “Alcon’s global infrastructure, financial resources and commercial capabilities will accelerate the standard of care by helping more patients have access to Aerie’s innovative products. I am confident that this combination with Alcon is in the best interest of patients and our shareholders.”

New focus on eye drops

The deal follows Alcon’s recent expansion into the ophthalmic pharmaceutical eye drop space, including acquisitions of the exclusive U.S. commercialization rights to Simbrinza from Novartis in April 2021 and of Eysuvis and Inveltys from Kala Pharmaceuticals in May 2022.

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“Alcon is passionate about innovative treatments in eye care, especially in core disorders such as glaucoma and dry eye, which have significant patient impact,” said David Endicott, chief executive officer of Alcon. “We have a 75-year history focused specifically on the eye and bring established expertise in development and commercial execution.”

Endicott said Aerie “is a natural fit with on-market and pipeline products, and R&D capabilities that offer the infrastructure needed to expand our ophthalmic pharmaceutical presence. As we continue to broaden our portfolio across glaucoma, retina and ocular surface disease, we are excited to help even more patients see brilliantly.”

The purchase price of $15.25 per share is a premium of 37% to Aerie’s last closing price and represents an equity value of about $770 million. The transaction was approved by the board of directors of each company.

Alcon said it intended to fund the acquisition through short-term and long-term debt. The transaction is expected to close in the fourth quarter of 2022.

Duke heritage

Aerie is a spinout of Duke University based on the glaucoma research of the late David L. Epstein, M.D., a clinician and scientist who chaired the Department of Ophthalmology at Duke’s School of Medicine for 22 years. 

The company has about 400 employees at its sites in Durham, Irvine, Calif., Bedminster, N.J., Tokyo, Dublin and Athlone, Ireland.

Aerie became a publicly traded company in 2013, and its stock shares are traded on the NASDAQ Global Market stock exchange under the symbol AERI.

Aerie’s most recent financial guidance for total glaucoma franchise net product revenue is $130 million to $140 million for full year 2022.

Earlier this month the company said in its third-quarter financial report that it expected to achieve cash flow break-even status in 2024.

Texas roots

Alcon, based in Geneva with U.S. headquarters in Fort Worth, Texas, is a global eye-care company with two business units, surgical and vision care.

The company serves 260 million people in over 140 countries each year with products including contact lenses, eye-drop medicines and surgical devices for treating cataracts, glaucoma and other vision problems.

Alcon was established in 1947 by two pharmacists in Fort Worth and has since grown to have 24,000 employees worldwide. 

The company reported sales of $8.2 billion in 2021. Its shares are traded on the New York Stock Exchange under the symbol ALC.

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