ISTA Pharmaceuticals, Inc.'s Board of Directors to Review Valeant Pharmaceuticals International’s Revised Proposal as Part of Its Ongoing Review of Strategic Options

IRVINE, CA--(Marketwire - January 17, 2012) - ISTA Pharmaceuticals, Inc. (NASDAQ: ISTA) announced today that it has received a revised non-binding proposal from Valeant Pharmaceuticals (NYSE: VRX) to acquire ISTA and will consider the updated proposal as part of its ongoing review of strategic options. On January 11, Valeant’s Chairman and CEO and two Directors met with Vicente Anido, Jr., Ph.D., ISTA’s President and Chief Executive Officer, and Richard C. Williams, ISTA’s Chairman of the Board. During the meeting, Valeant raised its initial proposal to $7.50 per share in cash and set a target price of $8.50 per share in cash, subject to one week of due diligence. Subsequently, on January 16 Valeant sent ISTA a letter confirming its increased non-binding proposal, which included a number of inaccuracies about ISTA’s process and the discussions between the two companies. ISTA’s process for review of strategic options is advancing as planned and in an expeditious manner, consistent with the Board’s fiduciary responsibilities and its commitment to maximizing shareholder value. As part of the strategic review process publicly announced on December 16, 2011, ISTA is currently in dialogue with a number of parties that have expressed an interest in pursuing a strategic transaction.

Vicente Anido, Jr., Ph.D., President and Chief Executive Officer of ISTA, said, “We are pleased with the progression of our strategic review since we embarked on it in mid-December. We have invited Valeant, along with a number of other parties, to participate in our process. We are considering Valeant’s revised proposal as part of that process, but we are fully committed to completing the strategic review with the aim of maximizing shareholder value. We view Valeant’s willingness to raise its bid at least $2.00 per share as a clear indication of the inadequacy of its initial proposal. Valeant has and continues to be offered the same confidentiality agreement, with no standstill provision, as all the other participants in our process and is subject to the same timeline. To date, Valeant has not executed a confidentiality agreement. Should Valeant choose to execute a confidentiality agreement as other parties have done, ISTA would provide them the same non-public information that we are providing to other parties. We do not think it is in the shareholders’ best interest to abort our process to accommodate Valeant’s artificially short timetable. Meeting Valeant’s demands to shorten the timeline would effectively foreclose the opportunity for a number of other interested parties to compete.”

Greenhill & Co. is acting as financial advisor to ISTA. Stradling Yocca Carlson & Rauth and WilmerHale LLP are acting as legal advisors to ISTA.

ABOUT ISTA PHARMACEUTICALS
ISTA Pharmaceuticals, Inc. is a fast growing and the third largest branded prescription eye care business in the United States with an expanding focus on allergy therapeutics. ISTA currently markets four products, including treatments for ocular inflammation and pain post-cataract surgery, glaucoma and ocular itching associated with allergic conjunctivitis. The company’s development pipeline contains additional candidates in various stages of development to treat dry eye, ocular inflammation and pain, and nasal allergies. Headquartered in Irvine, California, ISTA generated revenues of $156.5 million in 2010. For additional information about ISTA, please visit the corporate website at www.istavision.com.

FORWARD-LOOKING STATEMENTS
Any statements contained in this press release that refer to future events or other non-historical matters are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are intended to qualify for the safe harbor from liability established by the Private Securities Reform Act of 1995. Without limiting the foregoing, but by way of example, statements contained in this press release related to the review of Valeant’s revised non-binding proposal, review of the Company’s strategic options and the future value of ISTA are forward-looking statements. Except as required by law, ISTA disclaims any intent or obligation to update any forward-looking statements. These forward-looking statements are based on ISTA’s expectations as of the date of this press release and are subject to risks and uncertainties that could cause actual results to differ materially. Important factors that could cause actual results to differ from current expectations are detailed from time to time in ISTA’s public filings with the U.S. Securities and Exchange Commission, including but not limited to ISTA’s Annual Report on Form 10-K for the year ended December 31, 2010, and its Quarterly Report on Forms 10-Q for the quarters ended March 31, June 30 and September 30, 2011.