Alkermes has agreed to acquire Avadel Pharmaceuticals for up to $20 per share in cash, valuing Avadel at $2.1bn.

The acquisition expedites the entry of Alkermes into the sleep medicine sector.

The transaction received approval from the board of directors of both companies and will conclude in the first quarter of 2026.

It will add Avadel’s US Food and Drug Administration (FDA)-approved therapy, Lumryz (sodium oxybate), to Alkermes’ commercial portfolio.

The therapy is used to treat cataplexy or excessive daytime sleepiness in narcolepsy patients over seven years old.

The agreement will be immediately accretive on conclusion, and represents a strategic opportunity, building on Alkermes' operational infrastructure while adding rare disease capabilities.

Alkermes CEO Richard Pops stated: “This transaction represents a pivotal step in Alkermes' strategic evolution. With the acquisition of Avadel, we are able to accelerate our commercial entry into the sleep medicine market at a critical inflection point as we prepare to advance alixorexton into a Phase III programme in narcolepsy.

“Avadel's innovative portfolio, commercial capabilities and dedicated employees provide a strong foundation for growth in this therapeutic area. Enabled by our strong balance sheet, this all-cash transaction enhances our revenue growth profile and is expected to be immediately accretive, reinforcing our commitment to delivering long-term value for shareholders.”

The combined organisation’s financial capabilities will enable a broad development strategy for Alkermes’ orexin-2 receptor agonists portfolio, including ALKS 4510 and ALKS 7290, both currently in Phase I trials.

In December 2023, Novo Nordisk entered a definitive agreement to acquire Alkermes’s development and manufacturing facility in Athlone, Ireland.