Merck Sells Its Interest in Johnson & Johnson-Merck Consumer Pharmaceuticals
WHITEHOUSE STATION, N.J., Sept. 28, 2011 - Merck (NYSE:MRK), known outside the United States and Canada as MSD, today announced that the company has sold its 50 percent interest in the Johnson & Johnson"Merck Consumer Pharmaceuticals Co. joint venture (JJMCP) to Johnson & Johnson (J&J) affiliates, McNEIL-PPC, Inc., McNEIL MMP, LLC, and Johnson & Johnson, Inc. The venture between Merck and J&J was formed in 1989 to develop, manufacture, market and distribute certain over-the-counter (OTC) consumer products in the United States (U.S.) and Canada.
Merck decided to sell its interest in the joint venture to enable the company to fully focus on building the long-term growth prospects of the wholly-owned consumer products division that had been part of Schering-Plough Inc. prior to the 2009 merger. Under the agreement, Merck will receive a one-time payment of $175 million. Merck's rights to the Pepcid brand outside the U.S. and Canada are not affected by this transaction. Termination of the JJMCP venture also gives Merck greater freedom to operate in the OTC consumer sector, allowing Merck to fully exploit its pipeline of Rx-to-OTC switches as well as actively pursue OTC licensing activities in the U.S. and Canada.
Following the transaction, J&J will own the venture's assets which include the exclusive rights to market OTC Pepcid, Mylanta, Mylicon and other local OTC brands where they are currently sold in the U.S. and Canada. The partnership assets include a manufacturing facility in Lancaster, PA.
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This news release includes "forward-looking statements" within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such statements may include, but are not limited to, statements about the benefits of the merger between Merck and Schering-Plough, including future financial and operating results, the combined company's plans, objectives, expectations and intentions and other statements that are not historical facts. Such statements are based upon the current beliefs and expectations of Merck's management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements.
The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: the possibility that the expected synergies from the merger of Merck and Schering-Plough will not be realized, or will not be realized within the expected time period; the impact of pharmaceutical industry regulation and health care legislation; the risk that the businesses will not be integrated successfully; disruption from the merger making it more difficult to maintain business and operational relationships; Merck's ability to accurately predict future market conditions; dependence on the effectiveness of Merck's patents and other protections for innovative products; the risk of new and changing regulation and health policies in the U.S. and internationally and the exposure to litigation and/or regulatory actions.
Merck undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in Merck's 2010 Annual Report on Form 10-K and the company's other filings with the Securities and Exchange Commission (SEC) available at the SEC's Internet site (www.sec.gov).