Sunday, October 5, 2014

Just As I Predicted, Merck Has Already Returned $1 Billion Of The Consumer Health Assets' Price, To Bayer, Post Close

As I repeatedly said much earlier, the "effective price" received by Merck is significantly smaller, than that widely reported and disclosed -- after all the ancillary "swapping" dust. . . has settled. There are many side deals, in which Bayer receives support in the US, including $1 billion in cash, in order to offset parts of the price Bayer paid -- for legacy Schering-Plough's Consumer Health assets. They just were not remotely worth $14 billion. Just not possible, in a rational world.

Take a look -- from the October 1, 2014 Whitehouse Station press release -- an exerpt:

. . . .Merck has also entered into the previously announced worldwide collaboration between the companies to develop and commercialize soluble guanylate cyclase (sGC) modulators. This collaboration, effective today, includes Bayer’s AdempasTM (riociguat), the first in a novel class of compounds and the only treatment approved for both pulmonary arterial hypertension (PAH) and chronic thromboembolic pulmonary hypertension (CTEPH), as well as the investigational compound vericiguat that is currently in Phase 2 development. The collaboration also includes opt-in rights for other early-stage sGC compounds in development by both companies. Merck will be making an upfront payment of $1 billion in connection with the sGC collaboration.

As previously communicated, the two companies will equally share certain costs and net sales for all products and candidates included in the collaboration, with additional milestone payments due upon the achievement of agreed-upon sales goals. For Adempas, Bayer will continue to lead commercialization in the Americas, while Merck will transition to lead commercialization in the rest of the world. In order to preserve business continuity in markets outside of the Americas where Adempas is launching, Bayer will continue to provide commercialization support on behalf of Merck for a period of time. . . .

We will keep you up to date, as other givebacks are announced, here.

Observation: Babies. . . are the Infinite's opinion that the World should go on. . .

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