Chennai, Sep 16 (IANS): India's Sun Pharmaceutical Industries Ltd on Wednesday said one of its subsidiaries has entered into an agreement to acquire and merge with it the US- based ophthalmic drug maker InSite Vision Inc.

The transaction has a total equity value of approximately $48 million on fully diluted basis plus related debt and other transaction costs assuming all shares of InSite Vision are tendered in the offer.

In a statement, Sun Pharma said InSite Vision focuses on developing new specialty ophthalmic products.

The Indian company is in the process of establishing a branded ophthalmic business in the US.

As per the terms of the deal, an indirect wholly owned subsidiary of Sun Pharma will tender offer for all the issued and outstanding common stock of InSite Vision at $0.35 per share.

The price is a 30 percent premium to the implied price per share under the terminated Amended and Restated Agreement and Plan of Merger between InSite Vision and a competing bidder for InSite Vision's common stock based on the stock price of the competing bidder as of September 11, 2015.

The transaction has been approved by the board of directors of the Sun Pharma subsidiary. InSite Vision's board of directors has also approved the transaction and unanimously recommended that its stockholders tender their shares pursuant to the tender offer.

For the six month period ended June 30, 2015, InSite Vision recorded revenues of $3.8 million, an EBITDA loss of $6.4 million and a net loss of $7.5 million.

The proposed acquisition of InSite Vision, coupled with the recent in-licensing of Xelpros (Latanoprost BAK-free eye drops) in June 2015, are steps in this direction.

These deals give Sun Pharma access to four late stage branded ophthalmic products in the US, the statement said.

InSite Vision has developed the DuraSite and DuraSite2 drug delivery platforms which are capable of extending the duration of drug retention, thus resulting in lower dosing frequency, and potentially enhanced efficacy.

Based on this technology, InSite Vision has developed a pipeline of late-stage clinical candidates, and has recently filed a New Drug Application (NDA) with the US FDA for BromSite (0.075 percent bromfenac) for the treatment of inflammation and prevention of pain associated with cataract surgery, Sun Pharma said.

It plans to file another NDA in 2017 for DexaSite (0.1 percent dexamethasone) for the treatment of non-bacterial blepharitis, a common ocular condition for which there is no approved product currently available.

InSite Vision's AzaSite Plu is currently in Phase-3 clinical development for the treatment of eye infections, and ISV-101 is in Phase 1/2 clinical development for dry-eye disease and inflammation.

InSite Vision also has two commercialized products for treatment of bacterial eye infections.

"The potential addition of the InSite Vision portfolio serves as a significant step towards enhancing our branded specialty pipeline in the Ophthalmic segment.

"InSite Vision will bring with it a pipeline of three late-stage clinical candidates, validated drug delivery technology and a track record of achieving US FDA approval for ophthalmic products," Jerry St. Peter, vice president and head, Sun Pharma's US ophthalmic business, was quoted as saying in the statement.

The acquisition is subject to InSite Vision's stockholders tendering at least a majority of the outstanding shares (determined on a fully diluted basis).

Alternatively, InSite Vision stockholders representing a majority of the outstanding shares of InSite Vision's common stock voting to approve the transaction as required by applicable law, in addition to other customary closing conditions.

The acquisition is expected to close in the fourth quarter of 2015.