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AMO plans to buy Pfizer’s surgical ophthalmology business
The transaction will include the Healon line of viscoelastic products and will mark AMO’s entrance into the glaucoma device market.
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Advanced Medical Optics Inc. will buy Pfizer Inc.’s surgical ophthalmology business for $450 million in cash, the two companies announced.
Under the agreement, AMO will acquire the Healon (sodium hyaluronate) line of viscoelastic products, the CeeOn and Tecnis IOLs and the Baerveldt glaucoma shunt. According to Pfizer, these products generated sales of approximately $150 million in 2003.
In addition to the product lines, AMO will acquire manufacturing and research and development facilities in Groningen, Netherlands; Uppsala, Sweden; and Bangalore, India.
In an April 21 press release announcing the sale, Hank McKinnell, Pfizer’s chairman and chief executive officer, said, “In exploring our strategic options, Pfizer’s aim has been to find the best solution for the surgical ophthalmology business and its employees. This agreement is an ideal strategic fit for AMO and allows Pfizer to enhance its focus in other areas of ophthalmology, such as glaucoma and macular degeneration.”
Pfizer Inc. obtained the surgical business in April 2003 when Pfizer acquired Pharmacia Corp. The pharmaceutical giant announced in July 2003 that it was exploring strategic options for its surgical ophthalmology business, including potential sale. At that time, the company noted that the surgical ophthalmology business was outside its core strategic focus of human pharmaceuticals, consumer health care and animal health.
Mr. McKinnell was quoted in a press release in July 2003 saying, “Pfizer remains firmly committed to its ophthalmology medicines business,” which includes Xalatan (latanoprost) and Macugen (pegaptanib sodium), a drug it is co-developing with Eyetech Pharmaceuticals, as well as “a dedicated pharmaceutical ophthalmology research and development effort.”
Representatives from Pfizer were not immediately available as this issue went to press for further comment on the transaction.
Ideal strategic fit
During a conference call with investors on April 22, the day after the transaction was announced, James V. Mazzo, president and chief executive officer of AMO, said the purchase is an ideal strategic fit for the company.
The acquisition of the Healon franchise complements its existing cataract surgery product lines, which include advanced phacoemulsification systems, acrylic and silicone IOLs and IOL insertion systems, Mr. Mazzo said, and allows the company to complete its global cataract franchise. The addition of the Tecnis IOL will also strengthen its position in emerging refractive surgery categories, he said.
In addition to the surgical products, AMO is also acquiring state-of-the-art R&D and manufacturing facilities and personnel.
“Obviously, we are pleased and enthusiastic about the opportunities inherent in this transaction,” Mr. Mazzo said. “We believe that it is an excellent strategic move that will enhance the value of AMO for our customers and shareholders.”
In an interview with Ocular Surgery News, Mr. Mazzo said the viscoelastic Healon fills a product gap for the company and represents the majority of the business purchased.
“There are four main categories a physician looks at when doing cataract surgery — the need for a phacoemulsification system, insertion technology for the IOL, the IOL itself and the viscoelastic. You really need to have a full product offering to be able to compete in this segment,” he said.
“We have a large presence in advanced phacoemulsification, IOLs and insertion devices. We have some good technology in our AMO Vitrax (sodium hyaluronate) viscoelastic product line, but we were not at the share position or the breadth of product line that the Healon line provides. It complements us there and fills that need,” Mr. Mazzo continued.
He said the acquisition of the Tecnis IOL is also a strategic fit. It complements AMO’s existing line of IOLs and is the only IOL designed with a prolate anterior surface to provide improved contrast sensitivity and functional vision, he said.
Glaucoma device market
The acquisition of the Baerveldt glaucoma shunt will mark AMO’s entrance into the glaucoma device market, Mr. Mazzo noted.
He said AMO had been considering expanding into other ophthalmic device markets, including glaucoma, since the company was spun off from Allergan Inc. in 2002. But the company did not have appropriate products in its research and development pipeline, and company executives were hesitant to enter a market without first evaluating both the market’s needs and its potentials.
“We have a strong belief and philosophy that when you enter a segment, it is best to learn the physician segment and the patient segment before jumping in completely,” Mr. Mazzo said.
“This (the acquisition) will allow us to spend time with some key glaucoma specialists across the world, learn their needs and then be able to expand our horizons and opportunities in the glaucoma device segment,” he said.
For Your Information:
- James V. Mazzo, president and chief executive officer for Advanced Medical Optics Inc., can be reached at 1700 E. St. Andrew Place, P.O. Box 25162, Santa Ana, CA 92799-5162; (714) 247-8400; fax: (714) 247-8402; e-mail: Jim.Mazzo@AMO-Inc.com.