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Merck sells its interest in Johnson & Johnson-Merck Consumer Pharmaceuticals
WHITEHOUSE STATION, N.J.—Ending a 22-year-old partnership, Merck & Co., known outside the United States and Canada as MSD, announced this week that the company has sold its 50 percent interest in the Johnson & Johnson-Merck Consumer Pharmaceuticals Co. joint venture (JJMCP) to Johnson & Johnson Inc. Following the transaction, J&J will own the venture's assets, which include the exclusive rights to market over-the-counter Pepcid, Mylanta, Mylicon and other local OTC brands where they are currently sold in the United States and Canada. The partnership assets include a manufacturing facility in Lancaster, Pa.
The venture between Merck and J&J was formed in 1989 to develop, manufacture, market and distribute certain OTC consumer products in the United States and Canada. Merck decided to sell its interest in the joint venture "to enable the company to fully focus on building the long-term growth prospects of the wholly-owned consumer products division that had been part of Schering-Plough Inc. prior to the 2009 merger."
Under the agreement, Merck will receive a one-time payment of $175 million. Merck's rights to the Pepcid brand outside the U.S. and Canada are not affected by this transaction. Termination of the JJMCP venture, which will be renamed McNeil Consumer Pharmaceuticals Co., reportedly will also give Merck greater freedom to operate in the OTC consumer sector, "allowing Merck to fully exploit its pipeline of Rx-to-OTC switches as well as actively pursue OTC licensing activities in the U.S. and Canada," according to a company news release.