Viatris announced the finalisation of a transaction to divest its over-the-counter (OTC) business, completing the last step in its previously declared $3.37bn divestitures.
The US-headquartered company divested its entire OTC business to Cooper Consumer Health, a European OTC drug manufacturer, on 3 July. In the agreement, Cooper Consumer Health has gained access to two manufacturing plants based in Merignac, France; and Confienza, Italy, and a research and development site in Monza, Italy. In its strategic plan, Viatris retained the rights for its blockbuster generic drugs Viagra (sildenafil) and Dymista (azelastine hydrochloride and fluticasone propionate) alongside certain other OTC therapies.
Viatris first spread word of the OTC divestiture in October 2023 declaring definitive agreements to divest other areas of the company. Over the last few months, the nutraceutical company Matrix Pharma Private gained access to Viatris’ active pharmaceutical ingredients division and Spanish pharmaceutical company Insud Pharma acquired Viatris’ women’s health business. The latter deal gave Insud Pharma two manufacturing plants in India.
Furthermore, a December 2023 definitive agreement transferred Viatris’ European rights for therapies such as Duphaston (Dydrogesterone) and Femoston (estradiol) to Theramex. The generics company also divested commercialisation rights in some non-core markets that were acquired, when Viatris was formed through the combination of Mylan and UpJohn.
As per a 3 July press release, Viatris made the various divestitures to help achieve its “long-term gross leverage target” and “increase shareholder return through share buybacks and dividends”. The generics company also plans to use the money to acquire, develop and commercialise more therapies in the future. Last year, the company generated a total revenue of $15.4bn, reaching a free cash flow of $2.4bn. By 28 January 2024, the company had already completed $250m in share repurchases for this year.
In November 2022, Viatris released a strategic update detailing a two-stage plan for business growth with plans to end Phase I by the end of this year and execute Phase II between 2024 and 2028. In the first phase, the company aimed to complete all planned divestitures, have seven consecutive quarters of strong performance and continue progress on key science programmes among other things.
At the January 2024 JP Morgan Healthcare Conference, Viatris announced that it had achieved its goals for Phase I and will be advancing to Phase II, which prioritises the growth of the company’s ophthalmology division and prevention of base business erosion.
