The company will realise $300 million (€242m) from the sale of its stake in the venture to partner Biomet, based in Indiana, US. In the fiscal year-ended 30 April, BioMer achieved sales of $314 million.
Analysts welcomed the move as showing that the company is focusing on its core activities in chemicals and pharmaceuticals. Merck has already started to refocus its business, with a revamp of its R&D activities earlier this year following some pipeline failures.
Merck has been building up a franchise in cancer drugs since the expiry of patent protection on its top-selling diabetes medication metformin, and recently won its first approval for a new drug licensed from ImClone Systems in the US - called Erbitux (cetuximab) - for colorectal cancer.
The company is also active in generics and contract manufacturing of active pharmaceutical ingredients (APIs). Some analysts have suggested that, given its small size, Merck should lose even more weight and concentrate exclusively on generic pharmaceuticals and the more profitable elements in its chemicals portfolio, notably liquid crystal displays.
Sale of the stake in the joint venture is expected to be completed in the first quarter of next year and will result in exceptional income in 2004 for Merck of about $70 million.