Alkermes, which plans to spend up to $2.1 billion to acquire its Dublin, Ireland, neighbor Avadel Pharmaceuticals, hopes to have an immediate growth driver in the narcolepsy drug Lumryz.
Alkermes points out that through the deal, it prepares the groundwork for the potential commercialization of its own narcolepsy candidate, alixorexton.
The companies stated in a press release that under the deal, Alkermes will pay Avadel $18.50 per share and may add on a contingent value right of 1.50 per share in case the FDA approves Lumryz to treat idiopathic hypersomnia by the end of 2028.
The transaction is of up to $2.1 billion, which amounts to a 12 percent premium on the shares of Avadel at the end of the trading day. The premium is offsetting to 38 percent in contrast to the weighted average trading price of the past three months undertaken by Avadel.
Alkermes intends to conclude the deal within the first quarter of the following year. The Avadel acquisition is predicted to add instantaneous revenue enhancement to Alkermes, which registered a sales figure of 1.56 billion the previous year, 6% less than the year before.
Last month, during the World Sleep 2025 Congress, Alkermes provided promising phase 2 data on its sleep disorder asset alixorexton and boasted about the first drug of its type to show statistically significant effect on wakefulness, cognition, and fatigue with once-daily dosing, the long-acting orexin 2 receptor agonist.
In the first quarter of 2026, Alkermes intends to start a phase 3 trial of alixorexton in narcolepsy. Alkermes is hoping to have a substantial market presence by the time it might pass, later in the decade, due to its commercialization of Lumryz via the proposed Avadel buyout.
Above all, to us, is that it places us in the sleep market right after closing, Alkermes CEO Richard Pops said on a conference call on the acquisition.
We will be making a product that is realizing a quarter of a billion dollars a year of sales- interacting with the key sleep centres, the key sleep physicians, the key sleep nurses, knowing the payment system, the patient access process, he went on. Everything that is the working, the prosaic side of the launching of drugs of pharmaceutical companies in this world.
In the past two decades, Alkermes has been experienced in venturing into new drugs, since it has been using Vivitrol, a drug that treats alcohol and opioid dependence; Aristada, a schizophrenia treatment drug, and bipolar disorder treatment drug Lybalvi.
It will simply allow us in a new disease category to burn all these relationships, years before we roll out alixorexton, Pops said.
In the meantime, Avadel Lumryz, since its approval in May of 2023, is a strong competitor to the established franchise in the narcolepsy market, Jazz Pharmaceuticals Xyrem and Xywav.
The advantages of Lumryz, a variant of the same sodium oxybate compound that Jazz uses in their drugs, are that it may be taken once a day before 6:00 pm instead of twice a day, as is the case with Xyrem and Xywav, which forces patients to wake up halfway through the night to take the second dose.
During the first half of this year, Jazz posted a combination sale of its duo of narcolepsy at 833 million, which was a 3 percent growth on its year-end sales. Sales on the other side are rapidly increasing as Lumryz achieved the mark of $51 million in the first quarter and 68 million in the second quarter. Avadel expects sales between 265 and 275 million by 2025.
Pops feels such an increase is likely to persist. According to the Alkermes chief, Lumryz had 3,100 users at the end of the second quarter and is estimated to have 50,000 patients in the U.S. who could take oxybate therapies.
