Bayer to Sell its Brands to Denmark’s Leo Pharma

August 2, 2018  Source: Reuters 503

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The German drugmaker Bayer has approved to sell its well-known prescription dermatology brands to Denmark’s Leo Pharma, as it focuses on integrating Monsanto also for strengthening its drug development pipeline. The dermatology brands to be sold include skin creams against acne, fungal skin infections like rosacea, and few steroidal creams with a revenue of more than 280 million euros ($328 million) from 2017.

Bayer campaigned in this business as early as 2016, planning to fetch up to 1 billion euros, but it had withdrawn at a proposed deal with Avista. Bayer claimed that it would not disclose the financial terms of this deal with unlisted Leo, but people familiar with this deal claimed that the price tag was below the expectation of Bayer since some products have lost patent protection.

This transaction does not include Bayer’s over-the-counter dermatology brands like Canesten and Bepanthen. JP Morgan guided Bayer on the deal, as per the person who was familiar with the transaction. But Bayer and the investment bank have not commented on this.

As the well-known skin cream brands did not offer a hike in growth rates, they would deliver reliable revenues at solid margins. Complex production procedures would also remove many rivals. Leo said that the deal would broaden its treatment choice and combine both marketing and sales sections to make it more efficient.

By Ddu
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