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Oyster Point Pharma jumps 37% as Viatris agrees to acquire for $11/share in cash

Nov. 07, 2022 8:40 AM ETViatris Inc. (VTRS)By: Dulan Lokuwithana, SA News Editor19 Comments

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Maksim Labkouski

Updated to add latest share price moves

  • Oyster Point Pharma (NASDAQ:OYST), a company focused on eye disorders, announced Monday that Viatris (NASDAQ:VTRS) agreed to acquire it for $11.00 per share in cash plus a contingent

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Comments (19)

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FCFGUY profile picture
Finally, signs of life. The sale of the biosimilar franchise came as a surprise – it was supposed to be the future. Obviously, management saw a flaw in that assumption.

Now management wants to be “the next global ophthalmology leader”. Why not? Management has access to a global distribution network. They see what sells and for how much, and, what doesn’t. Selling little vials of ‘not too expensive to make stuff’ for a huge markup seems like a pretty good idea, and if they can establish a global franchise in the sector, so much the better. Viatris is a huge global marketer of medical OTC product – what’s the use of having a powerful distribution platform if you don’t use it?
@Friso Alenus isn't this bad for OYST shareholders, stock IPOed close to $17, in 2020 has high as $38.
52 week range
3.46 - 19.98
Friso Alenus profile picture
@WillingToLearn probably is. But I’m a Viatris shareholder. :)
@WillingToLearn You should have sold at $38. Just because it went that high, doesn't mean that it's worth that. For a small specialty pharma like OYST I'm sure it was over-priced for the IPO.
ronald61239 profile picture
What will be the total cost to Viatris be ?? Will the funds come from FCF or a loan ??
Friso Alenus profile picture
@ronald61239 will be funded by the biosimilars sale. Both acquisitions would cost Viatris around 700-800 mil. This still leaves some room for buybacks. Stock reacts positive because investors see new path to sales growth + good earnings results.
ronald61239 profile picture
@Friso Alenus ---And I thought those fund would be used to pay down debt.
Friso Alenus profile picture
@ronald61239 plan was buybacks and they were open for M&A. Debt target was achieved before schedule in 2022. Securing strong long term FCF also important.
What a disappointing takeout price for OYST. Viatris won't close the acquisition of Oyster Point until Q1 2023, perhaps there still is hope for a bigger more capable eye care player that could better commercially leverage what is probably the best dry eye data and label in the ophthalmic space.
07 Nov. 2022
Another value losing Aquisition. This company's MO ever since it was Mylan was to destroy shareholder value through overpaying for other companies.
Friso Alenus profile picture
@w97 weak argument, all buyouts in biotech are money losing companies since they have no proper supply chain and marketing. Viatris does have the infrastructure to make money with these acquisitions.
Has Viatris ever before indicated a goal to be “the next global ophthalmology leader"?
It`s always the first time sometime.
Capital Kong profile picture
why do share buybacks or debt pay down at low PE's when you can acquire negative earning GAAP companies....at least this management team no longer has any of my money.
Friso Alenus profile picture
@Capital Kong weak argument, all buyouts in biotech are money losing companies since they have no proper supply chain and marketing. Viatris does have the infrastructure to make money with these acquisitions.
@Capital Kong wouldn't the right question be why OYST's earnings are negative and if the reason is something that VTRS is in a good position to remedy to its advantage?
Wapiti19 profile picture
More debt….Sigh
Friso Alenus profile picture
@Wapiti19 no debt. Biosimilars sale will fund two acquisitions and share buybacks.
TraderJoeZ profile picture
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