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Bausch Acquires License for Myopia Solution from Eyenovia

Zacks Equity Research
·4 mins read

Bausch Health Companies Inc. BHC announced that it has acquired an exclusive license for an ophthalmic solution from clinical-stage ophthalmic biopharmaceutical company, Eyenovia EYEN, which is developing a pipeline of microdose array print (MAP) therapeutics.

The company has acquired an exclusive license from Eyenovia in the United States and Canada for the development and commercialization of an investigational microdose formulation of atropine ophthalmic solution.

This solution is currently being evaluated for the reduction of pediatric myopia progression, also known as nearsightedness, in children aged 3-12 years. Per the company, it has been developed for the comfort and ease-of-use in children and the microdose administration is designed to potentially result in low systemic and ocular drug exposure. This investigational formulation of atropine is delivered with Eyenovia's proprietary Optejet dispenser technology.

Under the terms of the licensing agreement, Bausch Health will make an upfront $10-million payment to Eyenovia upon signing. The former will take up the costs related to the ongoing phase III CHAPERONE study. In addition, Eyenovia is eligible to receive up to $35 million in additional milestone payments based on approval- and launch-based milestones, as well as royalties ranging from mid-single digit to mid-teen percentages of gross profit on sales in the United States and Canada.

The product upon approval will have significant potential, as myopia is estimated to affect approximately 25 million children in the United States.

Bausch’s stock has plunged 42.2% in the year so far compared with the industry’s decline of 3.5%.

 

The company was in the news last week after it released preliminary results for the third quarter. Bausch Health expects third-quarter 2020 revenues to be greater than $2.1 billion, an increase of approximately 28% sequentially.

Additionally, based on the pace of recovery of its various businesses observed in the third quarter and assuming its businesses continue to rebound from the impact of the COVID-19 pandemic, Bausch Health currently expects 2020 revenues to be around the midpoint of its current guidance range of $7.80-$8.00 billion.

Earlier, Bausch Health and Eton Pharmaceuticals, Inc. ETON announced that the FDA approved Alaway Preservative Free (ketotifen fumarate) ophthalmic solution, 0.035%, antihistamine eye drops (EM-100), as the first over-the-counter (OTC) preservative-free formulation eye drop approved to temporarily relieve itchy eyes due to pollen, ragweed, grass, animal hair and dander. Bausch Health acquired the U.S. rights to Alaway Preservative Free from Eton last year.

Concurrent with the second-quarter results, Bausch announced intentions to spin off its eye health business, Bausch + Lomb, into an independent, publicly-traded entity. The spinoff will establish two separate companies, which include a fully-integrated, pure-play eye-health company built on the iconic Bausch + Lomb brand and a diversified pharmaceutical company with a focus on gastroenterology, aesthetics/dermatology, neurology and international pharmaceuticals.

Bausch currently carries a Zacks Rank #5 (Strong Sell). A better-ranked stock in this space is Dr. Reddy’s Laboratories Ltd RDY, which carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Dr. Reddy’s earnings per share estimates have risen from $1.84 to $1.90 for 2021 and from $2.11 to $2.25 for 2025 over the past 90 days.

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Dr. Reddys Laboratories Ltd (RDY) : Free Stock Analysis Report
 
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Eyenovia, Inc. (EYEN) : Free Stock Analysis Report
 
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