Johnson & Johnson spiked its deal with Palomar Medical Technologies Inc. to co-develop an over-the-counter cosmetic device, citing the economic recession and an unwillingness to sink lots of cash into clinical trials.
Burlington, Mass.-based Palomar said JNJ killed the deal over concerns about the economic recession.
“Despite Palomar having met all of its deliverables under the agreement, [J&J] terminated the agreement referencing the current unfavorable economic conditions as the reason for its decision,” according to a press release.
The Food & Drug Administration gave 510(k) approval to the device in June, setting the stage for it to hit the market as the first OTC light-based anti-wrinkle treatment. In spiking the deal, J&J avoids having to pay a substantial commercialization fee to Palomar and funding the product launch.
Palomar CEO Joseph Caruso said the company will launch the “game-changing” product on its own, albeit at a lesser scale than planned.
“The current economic climate does not warrant a large scale investment in a mass-market launch at this time,” Caruso said in a statement. “Therefore, we have adjusted our launch plans to be more in line with current economic conditions. In the short-term, our goal is to establish our consumer products in the market using certain specialty channels and gather the valuable information needed to fully execute our long-term strategy of a full mass market launch.”