ALKS Raises Its Offer to Buy Avadel In Response to Lundbeck's Proposal

Alkermes ALKS announced that it has now increased the offer to acquire Ireland-based Avadel Pharmaceuticals AVDL in a deal valued at up to $22.50 per share, representing a total transaction value of approximately $2.37 billion.

Year to date, shares of Alkermes have lost 0.3% against the industry’s growth of 16.5%.

ALKS’ Battle With Lundbeck Related to Avadel Buyout

Alkermes is locked in an ongoing battle with Denmark-based H. Lundbeck A/S regarding its offer to acquire Avadel.

Last month, Alkermes announced a definitive agreement to acquire Avadel in a deal valued at up to $20.00 per share in cash, representing a total transaction value of around $2.1 billion.

Earlier this month, Lundbeck made an unsolicited offer to acquire Avadel for up to $23.00 per share, valuing the latter at approximately $2.4 billion. Following the unsolicited acquisition proposal from Lundbeck, Avadel informed Alkermes that it considered the former’s offer to be a Company Superior Proposal.

This opened a five-business-day window in which Alkermes had the option to negotiate with Avadel to revise the proposal so that Lundbeck’s bid would no longer be deemed superior.

Alkermes has eventually submitted the terms of its proposed increased offer to acquire Avadel. As a result, Avadel has now determined that Lundbeck’s proposal no longer constitutes a Company Superior Proposal.

Lundbeck was looking to buy Avadel for up to $23.00 per share, including $21.00 in cash plus a non-transferable contingent value right (“CVR”) that could pay an extra $1.00 if Lumryz and valiloxybate reach $450 million in annual net sales in the United States by 2027 and another $1.00 if they reach $700 million by 2030.

More on ALKS’ Latest Offer to Buy Avadel

Alkermes’ increased offer values Avadel at up to $22.50 per share, comprising a $21.00 cash payment and a non-transferable CVR worth up to $1.50. This CVR would be payable upon final FDA approval of Lumryz for adult idiopathic hypersomnia by December 2028, as specified in the forthcoming CVR agreement.

The increased offer from Alkermes now values Avadel for up to $2.37 billion.

AVDL’s board concluded that the CVR terms in Alkermes’ revised offer are superior to those in Lundbeck’s proposal, which the board believes is unlikely to be achieved.

As previously announced, the transaction is expected to close in the first quarter of 2026, subject to customary closing conditions.

Alkermes previously offered to purchase all outstanding ordinary shares of Avadel for $18.50 per share in cash, including CVR worth up to an additional $1.50, payable on the FDA approval of Lumryz for treating idiopathic hypersomnia in adults by the end of 2028.

Avadel’s lead commercial product Lumryz is approved as the first and only once-at-bedtime oxybate for extended-release oral suspension for the treatment of cataplexy or excessive daytime sleepiness in patients aged seven years and older with narcolepsy.

In the first nine months of 2025, Lumryz generated sales worth $198.1 million, reflecting an increase of almost 67% on a year-over-year basis.

Given the ongoing bidding war between Alkermes and Lundbeck, it remains to be seen whether the latter will further increase the offer to acquire Avadel or not.

ALKS' Zacks Rank & Other Key Picks

Alkermes currently sports a Zacks Rank #1 (Strong Buy).

Some other top-ranked stocks in the biotech sector are CorMedix CRMD and Castle Biosciences CSTL, each sporting a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

In the past 60 days, estimates for CorMedix’s 2025 earnings per share have increased from $1.52 to $2.90. Earnings per share estimates for 2026 have moved up from $2.09 to $2.72 during the same period. CRMD stock has surged 23.8% year to date.

CorMedix’s earnings beat estimates in each of the trailing four quarters, with an average surprise of 27.04%.

In the past 60 days, estimates for Castle Biosciences’ 2025 loss per share have narrowed from 65 cents to 23 cents. Loss per share estimates for 2026 have narrowed from $2.10 to $1.42 during the same period. CSTL stock has rallied 30% year to date.

Castle Biosciences’ earnings beat estimates in three of the trailing four quarters, while missing the same on the remaining occasion, with an average surprise of 66.11%.

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This article originally published on Zacks Investment Research (zacks.com).

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