Avadel Gets Acquisition Proposal From Lundbeck Weeks After Inking Agreement With Alkermes

• While Alkermes agreed to buy Avadel for up to $20 per share, Lundbeck proposed to acquire the drugmaker for up to $23 per share.
• The Avadel board has not yet decided that the Lundbeck Proposal is indeed superior to the existing agreement with Alkermes. 
• No shareholder action is required at the time, Avadel added.

Avadel Pharmaceuticals Plc (AVDL) said on Friday that it has received an unsolicited proposal from H. Lundbeck A/S to acquire the drugmaker for up to $23 per share.

The proposal comes on the heels of Alkermes (ALKS) deciding to acquire all outstanding ordinary shares of Avadel for up to $20 per share in October. Avadel’s board of directors is of the opinion that the fresh proposal would reasonably be expected to be considered superior to the company’s existing agreement with Alkermes.

However, the board has not yet decided that the Lundbeck Proposal is indeed superior to the existing agreement with Alkermes and continues to be in support of the agreed-upon deal.

Terms Of Proposal

Lundbeck offered to acquire Avadel for $21 per ordinary share in cash at closing and a non-transferable contingent value right entitling holders to additional cash payments of up to $2 upon the completion of certain milestones.

Under its existing deal with Alkermes, Avadel can provide information to and conduct discussions with Lundbeck, but not terminate its agreement with Alkermes or enter into an agreement with Lundbeck. Further, there is no assurance that Lundbeck will make an offer for Avadel, it said.

No shareholder action is required at the time, the company added.

The events are reminiscent of the recent bidding war between Novo Nordisk and Pfizer for obesity drug maker Metsera.

Pfizer completed the acquisition of Metsera for up to $10 billion on Thursday, following a bidding war initiated by Danish drugmaker Novo Nordisk, which made an unsolicited proposal for Metsera after the company entered into an agreement with Pfizer. Novo Nordisk’s escalating bids to acquire Metsera forced Pfizer to increase its initial offer of up to $4.9 billion.

How Did Stocktwits Users React?

AVDL shares jumped 18% in the premarket session at the time of writing. On Stocktwits, retail sentiment around AVDL stock jumped from ‘neutral’ to ‘bullish’ territory over the past 24 hours, while message volume rose from ‘low’ to ‘normal’ levels.

AVDL stock is up by 83% this year and by 66% over the past 12 months. 

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