Allergan plc (formerly known as Actavis) has agreed to acquire Oculeve, a development-stage medical device company focused on developing treatments for dry eye disease in an all-cash transaction. Under the agreement, Allergan will acquire Oculeve for a $125 million upfront payment and commercialization milestone payments related to Oculeve’s lead development program OD-01. The agreement also includes the acquisition of an additional earlier-stage dry-eye device development program.

The acquisition of Oculeve adds complementary dry-eye development programs to Allergan’s current eye-care research and development programs, including OD-01, a non-invasive nasal neurostimulation device that increases tear production in patients with dry eye disease. Oculeve has completed four clinical studies of OD-01 to date in more than 200 patients, showing positive safety and efficacy of the device. Allergan plans to conduct two additional pivotal trials prior to submission to the US Food and Drug Admnistration, which is expected in 2016 with potential commercial launch in 2017. /p>

Chronic dry eye is a disease that can be caused by advanced age, contact lens wear, certain medications, eye diseases, other medical conditions or environmental factors. One type of chronic dry eye is caused by decreased tear production due to inflammation. Without enough tears, the film protecting the eye can break down, creating dry spots on the cornea. Chronic dry eye is estimated to affect 25 million patients in the US, according to information from Allergan.

The transaction is subject to the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. Pending approvals, Allergan anticipates closing the transaction in the third quarter of 2015.

Allergan is the new corporate name following the approximately $70 billion acquisition of Allergan by Actavis, in a deal that was announced in 2014 and closed in March 2015. In June 2015, Actavis announced that the combined company would use Allergan as its corporate name, and the Actavis name would continue to be used for the company’s US and Canadian generics businesses.

Source: Allergan