Merck & Co to bank $175 million on selling its share of consumer JV with Johnson & Johnson

US drug giant Merck & Co (NYSE: MRK) said yesterday that it has sold its 50% interest in the Johnson & Johnson-Merck Consumer Pharmaceuticals joint venture (JJMCP) to Johnson & Johnson (NYSE: JNJ) and its McNeil affiliates for a one-time payment of $175 million. The JV was formed in 1989 to develop, manufacture, market and distribute certain over-the-counter (OTC) consumer products in the USA and Canada.

Merck says its decision to sell its interest in the JV will allow it to fully focus on building the long-term growth prospects of the wholly-owned consumer products division that had been part of Schering-Plough prior to the 2009 merger. Under the terms the accord, Merck's rights to the Pepcid (famotidine) antacid brand outside the USA and Canada are not affected.

Termination of the JJMCP venture, which will be re-named as McNeil Consumer Pharmaceuticals, also gives Merck greater freedom to operate in the OTC consumer sector, allowing the firm to fully exploit its pipeline of Rx-to-OTC switches as well as actively pursue OTC licensing activities in the USA and Canada, the company notes.