New York, Aug. 22 (Reuters): OSI Pharmaceuticals said on Sunday it agreed to buy eye disease treatment maker Eyetech Pharmaceuticals Inc for around $935 million in cash and stock.

OSI will buy all outstanding Eyetech common shares for $20 each, the companies said ? a 43 per cent premium to Eyetech’s August 19 closing price of $13.99.

The agreement calls for 75 per cent of the purchase price, or $15 per share, to be paid in cash with the rest to be paid in OSI common stock using an exchange ratio of 0.12275 OSI shares for each Eyetech share.

“The combination of OSI and Eyetech will create a substantial biopharmaceutical company with over $600 million of projected revenues in 2006 and strong growth prospects for the future,” OSI chief executive Colin Goddard said. “We believe the proposed transaction will deliver scale to OSI’s current business, bring forward profitability and provide for double-digit revenue growth over the next five years.”

Eyetech’s stock has slumped 69 per cent so far this year.