Allergan to acquire Oculeve in all-cash transaction – Healio

Allergan ($AGN) has scooped up a med tech startup with an innovative treatment for dry eye disease, paying $125 million up front for the rights to a tiny device designed to spur tear production. The device, OD-01, has successfully treated symptoms of dry eye across four clinical trials in more than 200 patients, according to Allergan, and the company plans to launch two more studies before submitting the implant for FDA scrutiny in 2016.

Allergan said it expects the deal with Oculeve to be finalized sometime in the third quarter of 2015. The deal is also meant to raise the migraine drug presence of Allergan-fresh off its $70.5 billion acquisition by Actavis, in a deal announced last year. Allergan is also liable to make commercialization milestone payments related to Oculeve’s lead development program OD-01.

Allergan plcAGN continues to be in acquisition mode with the company now entering into an agreement under which it will acquire a development-stage medical device company, Oculeve.

Chronic dry eye disease affects some 25 million patients in the United States.

Allergan agreed to pay $125 million upon expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, and the other $125 million in April 2016. As part of the deal, Allergan also bought an additional earlier-stage dry eye device development program. Some better-ranked stocks in the health care sector include Progenics Pharmaceuticals, Inc.

A day earlier, Teva Pharmaceutical Industries said its TEV-48125 yielded statistically significant reductions in migraine days-53% of patients given the 225 mg dose and 59% given 675mg, compared with 28% receiving placebo.

According to an Orange County Business Journal article, Parsippany, N.J.-based, Ireland-domiciled Allergan is a major player in dry eye treatments, marketing the Restasis prescription eye drops. The company was founded out of a multi-disciplinary collaboration with the Stanford Biodesign Center and Department of Ophthalmology at Stanford University, spun-out by Michael Ackermann, CEO, Jim Loudin, VP of Research and Development, Professor Mark Blumenkranz, who serves on the Oculeve Board of Directors, and Professor Daniel Palanker, who serves on the Scientific Advisory Board. The device firm received seed funding from Kleiner Perkins Caufield and Byers, with additional financial backing from New Enterprise Associates and Versant Ventures.

Statements contained in this press release that refer to future events or other non-historical facts are forward-looking statements that reflect Allergan’s current perspective of existing trends and information as of the date of this release.

Allergan’s stock was up following the announcement of the acquisition.