Leo Pharma has agreed to acquire Bayer’s global prescription dermatology unit for an undisclosed price, the companies said, in a deal that expands the buyer’s focus on skin drugs.
The portfolio that Leo is acquiring from Bayer includes branded topical prescription treatments for acne (Skinoren®), fungal skin infections (Travogen® and Travocort®) and rosacea (Finacea®), and a range of topical steroids (Advantan®, Nerisona®, and Desonate®).
Not included in the transaction are Bayer’s over-the-counter dermatology brands, which include Bepanthen® and Canesten®.
According to Leo and Bayer, the portfolio generated more than €280 million ($328 million) in revenues last year—a 1.7% fraction of the total €16.847 billion ($19.7 billion) in revenues reported by Bayer last year for its pharmaceuticals division, up 2.6% from 2016.
Leo said the deal will add complementary treatment areas and strengthen its existing business worldwide, allowing the company to more than double sales in some markets.
“With the strong prescription dermatology brands and the new colleagues from Bayer, Leo Pharma advances significantly towards our goal of helping 125 million patients by 2025,” Leo Pharma President and CEO Gitte P. Aabo said in a statement. “We will broaden our treatment range and considerably enhance our size in key markets around the world – underlining our ambition to be a preferred partner in medical dermatology.”
Leo Pharma plans to acquire global product rights to the Bayer prescription dermatology portfolio worldwide except for Afghanistan and Pakistan, as well as take over sales and marketing operations in 14 countries, as well as a factory in Segrate, Italy.
The deal is set to close later this year in the U.S., and during the second half of 2019 for all other markets, subject to satisfaction of customary closing conditions, including approval by authorities.
About 450 people will join Leo Pharma as part of the transaction. Bayer reported a workforce of 38,295 Pharmaceuticals employees as of December 31, 2017, down 4.5% from 2016.
Overall, Bayer reported 99,820 employees in all operations, up 0.2% from 2016. Pharmaceuticals accounted for about half of Bayer’s total 2017 revenues of €35.015 billion (about $41 billion), also up 0.2% from 2016.
Earlier this year, Bayer completed its $63 billion acquisition of Monsanto—the top M&A deal of the first half of 2018, as ranked by GEN.
“With the dedicated support of many employees to whom we are grateful, our prescription dermatology business has grown well since becoming part of Bayer in 2006,” added Heiko Schipper, member of Bayer’s board of management and president of consumer health. “Moving forward, we believe that Leo Pharma is the right owner to grow and further develop the prescription dermatology business while enabling us to focus on building our core over-the-counter brands.”