By Randall Osborne
Merck & Co. Inc. has agreed to sell E. I. DuPont & Co. its half of their joint venture, DuPont Merck Pharmaceutical Co., for $2.6 billion in cash.
As DuPont, of Wilmington, Del., takes full ownership of the seven-year-old company, about 4,200 employees will be transferred to the newly created DuPont Pharmaceuticals Inc., also of Wilmington.
"We're looking at a total life sciences business for DuPont," said DuPont spokeswoman Kathy Forte. "We're into agricultural biotechnology and crop protection chemicals now, and we're getting into [development of enhancements to animal] feed. The third piece is pharmaceuticals."
DuPont, she added, "wanted to grow our presence in pharmaceuticals, and with Merck being so huge in pharmaceuticals [already], it was not a priority for them."
Moving from agricultural biotech to human drugs may allow DuPont to "achieve a lot of synergies," Forte told BioWorld Today. "Biotechnology is really the underpinning. That's the big picture. Specifically, we'll have to see how it plays out."
Of particular interest, Forte said, will be the field of nutraceutics, which uses plant extracts as human nutritional aids.
"They might be delivered through a pharmaceutical or a soy product, to enhance nutrition or fight disease," she said. "It's an emerging field."
John Doorley, spokesman for Whitehouse Station, N.J.-based Merck, said the company "decided our investments would be better spent on our core business." Merck introduced nine new medicines between January 1995 and the end of 1997. Earlier this week, the FDA approved Merck's Aggrastat (tirobifan HCI), a blood clot blocker. (See BioWorld Today, May 18, 1998, p. 1.)
Collaborations Belong To DuPont
All collaborations made by the joint venture company, which recorded $1.3 billion in sales last year, become the property of DuPont.
Among the more recent collaborations is a three-year deal signed in January by DuPont Merck with Signal Pharmaceuticals Inc., of San Diego, worth up to $25 million to develop drugs that inhibit the gene-regulating targets of the hepatitis C virus and HIV.
"We have nothing to do with it now," Doorley said.
Forte said DuPont will be examining biotech "partnerships, alliances, joint ventures, whatever makes sense. But we're not going to make any hugely dilutive acquisitions. They'll be more selective."
DuPont Merck last year reported data from an ongoing Phase II combination study of its DMP 266 product, a non-nucleoside reverse transcriptase inhibitor, and Crixivan, a protease inhibitor, indicating the drugs eliminated HIV in 80 percent of patients. DMP 266 is in Phase III trials.
The drug, if approved, will be marketed by DuPont as Sustiva in the U.S., Canada and certain European countries, and by Merck as Stocrin in the rest of the world.
Merck and DuPont will continue their research collaboration aimed at developing GPIIb/IIIa platelet blockers in addition to Merck's Aggrastat.
Merck's sell-back agreement will have no impact on the two companies' marketing deal for Cozaar and Hyzaar, one of a new class of anti-hypertensive agents, which Merck markets and sells worldwide.
"That's what we know we're collaborating on, as of today," Forte said. "We have a lot to work out." *