Eye specialist Oyster Point Pharma announced is being acquired by Viatris Inc. after Oyster’s board of directors unanimously signed off on the deal, Oyster Point announced Monday.
Eye specialist Oyster Point Pharma announced is being acquired by Viatris Inc. after Oyster’s board of directors unanimously signed off on the deal, Oyster Point announced Monday.
Under the acquisition offer, Viatris will purchase all outstanding Oyster Point shares at $11.00 per share, to be paid in cash at the deal’s closing. The agreement also includes a contingent value right for additional cash payments of up to $2.00 per share upon achieving specific performance targets in 2022.
In particular, Oyster Point’s shareholders will get $1.00 more per share if the New Jersey biotech generates at least $21.6 million net revenue of Tyrvaya (varenicline solution). This add-on increases to $2.00 per share if net revenues reach $24.0 million.
The companies expect to close the transaction early next year.
In a statement, Jeffrey Nau, Ph.D., MMS, president and chief executive officer of Oyster Point, said the acquisition agreement will bring together his company’s portfolio and industry expertise with Viatris’ global scale and capabilities to “meaningfully shape the future of eye care, to the benefit of patients.”
After the deal has been closed, Viatris will then move to acquire all remaining shares of Oyster Point that were not tendered into the buyout offer. This second-step merger will have the same per-share price of $11.00, along with the $2.00 CVR.
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The buyout will grant Viatris access to Oyster Point’s Tyrvaya, a therapeutic nasal spray approved by the FDA in October 2021. Tyrvaya is the first and only FDA-approved nasal spray for dry eye in the U.S.
Tyrvaya is a highly selective cholinergic agonist that mimics the action of the neurotransmitter acetylcholine to activate the parasympathetic nervous system, promoting the production of the basal tear film and ultimately easing dry eye symptoms. Varenicline, the drug’s active component, can engage the nicotinic acetylcholine receptor on the trigeminal nerve, which is accessible through the nose.
In June, before the drug’s launch, Oyster Point cut off some 50 employees to “prioritize launch expenses for Tyrvaya and its field-based sales resources,” Nau said. The job cuts were concentrated in general and administrative roles, and the company continued to allocate some 150 to 200 field-based sales personnel to drive the product launch.
Nau added that the company believes this will reduce the total operating expenses and continue to drive the Tyrvaya launch forward.
Aside from the dry eye nasal spray, Oyster Point will also hand over a healthy pipeline of ophthalmic therapies. This includes OC-01, another nasal spray formulation of a varenicline solution, currently under Phase II assessments for stage I neurotrophic keratopathy. Results are expected later this year.
The pipeline also involves two gene therapies: OC-101 AAV-NGF for stage 2 and 3 neurotrophic keratopathy and OC-103 AAV-DAO for vernal or atopic keratoconjunctivitis. Both are intravitreally injected and are scheduled for pre-investigational new drug meetings within the year.
