LAKE FOREST, Ill. — Akorn Inc. plans to acquire Hi-Tech Pharmacal Co. for $640 million in a move to expand its eye drug portfolio to oral liquids and ointments.

Akorn said Tuesday that the all-cash deal will make it the third-largest U.S. generic ophthalmic player and significantly increase its retail presence in prescription and over-the-counter products.

The acquisition will also add branded OTC products in the categories of cough and cold, nasals and topicals to Akorn’s TheraTears brand of eye care products.

Hi-Tech develops and markets generic and branded prescription and OTC products and specializes in difficult-to-manufacture liquid and semisolid dosage forms. It produces a range of sterile ophthalmic, ear-related and inhalation products.

"This is a transformative event for our company," Raj Rai, chief executive officer at Akorn, said in a statement. "The portfolio of Hi-Tech products is a great strategic fit to our currently marketed products as it diversifies our offerings to our retail customers beyond ophthalmics to other niche dosage forms such as oral liquids, topical creams and ointments, nasal sprays and otics. In addition, we are excited about Hi-Tech’s product pipeline, which would further enhance growth opportunities for the combined platform."

He added, "We plan to capitalize on the manufacturing capabilities of Hi-Tech to expand our presence in the private-label OTC business."

The combined company is expected to have annual revenue of more than $500 million.

Hi-Tech CEO David Seltzer stated, "The combined portfolio of marketed products and products in development offer a very unique platform with great growth potential. We are very pleased to be joining forces with Akorn and their strong management team led by Raj Rai."

Pending customary closing conditions, the acquisition is expected to close in the first quarter of 2014, according to Akorn.