With Avadel under its fold, Alkermes expects to accelerate its expansion into the sleep market, laying the foundation for its late-stage narcolepsy asset alixorexton.
In a bid to expand into the sleep medicine market, Alkermes is acquiring Avadel Pharmaceuticals and its narcolepsy drug Lumryz in a deal potentially reaching more than $2 billion in value.
Under the terms of the deal, Alkermes will buy all of Avadel’s outstanding ordinary shares for $18.50 per share, while tacking on a contingent value right of $1.50 per share, payable if the FDA approves Lumryz for idiopathic hypersomnia by the end of 2028. The total per-share purchase price of $20 results in a total deal value of approximately $2.1 billion and represents a 38% premium to Avadel’s weighted average trading price over the last three months, according to a company announcement on Wednesday.
Alkermes and Avadel expect to close the transaction in the first quarter of 2026, pending certain conditions such as the approval of the latter’s shareholders and regulatory clearances.
Avadel’s only commercial product, Lumryz, is the star of Wednesday’s buyout. The companies suggest it could bring in $265 million to $275 million in net revenues this year, according to the news release. The drug was approved by the FDA in 2023 to treat excessive daytime sleepiness in adults with narcolepsy. About 3,100 U.S. patients received Lumryz treatment as of June 30.
Avadel is also positioning Lumryz for expansion into idiopathic hypersomnia, for which it is running the Phase III REVITALYZ study, set to complete by the end of this year. The FDA has granted the drug orphan drug designation for this indication.
The Avadel acquisition “represents a pivotal step in Alkermes’ strategic evolution,” CEO Richard Pops said in a statement, noting that the move will also accelerate the company’s expansion into the sleep medicine market. The Ireland-based biotech is also working on its own narcolepsy drug alixorexton, which, according to Pops, is currently gearing up to enter late-stage development.
Alixorexton is also being tested for idiopathic hypersomnia, for which Alkermes is running a Phase II study.
After a lull earlier this year, M&A has been picking up in recent weeks. Also on Wednesday, for instance, Ipsen bet up to $1.6 billion to absorb the privately held ImCheck Therapeutics for its pipeline of immuno-oncology assets. Earlier this month, Novo Nordisk made a $5.2 billion play for Akero Therapeutics and its closely watched asset efruxifermin, being trialed for metabolic dysfunction-associated steatohepatitis. And a day later, Bristol Myers Squibb dropped $1.5 billion to swallow Orbital Therapeutics and its investigational cell therapies that can reprogram the immune system.
Other standout recent acquisitions include Pfizer’s $4.9 billion takeover of obesity player Metsera and Genmab’s $8 billion gamble for Merus and its bispecific candidates.
