12:03 PM EDT, 10/22/2025 (MT Newswires) -- Alkermes ( ALKS ) has agreed to acquire Avadel Pharmaceuticals ( AVDL ) in a cash deal worth up to $2.1 billion as the Ireland-based biopharmaceutical company seeks to break into the sleep medicine market, the companies said Wednesday.

Alkermes ( ALKS ) will pay up to $20 per Avadel share, which represents a 12% premium to the target company's closing stock price Tuesday.

The acquisition gives Alkermes ( ALKS ) control over Avadel's Lumryz, which the US Food and Drug Administration has approved for the treatment of cataplexy or excessive daytime sleepiness.

The consideration is split into an upfront payment of $18.50 per share, plus a potential $1.50 tied to the FDA's approval of Lumryz for idiopathic hypersomnia in adults by the end of 2028, according to a joint statement.

"This transaction represents a pivotal step in Alkermes' ( ALKS ) strategic evolution," Alkermes ( ALKS ) Chief Executive Richard Pops said. "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 3 program in narcolepsy."

The acquisition, which requires approvals from regulators and Avadel's shareholders, is anticipated to close in the first quarter of 2026, the companies said.

Shares of Avadel were up 4% in Wednesday trade, while those of Alkermes ( ALKS ) rose 0.5% on the Nasdaq.

Alkermes ( ALKS ) expects the transaction to enhance its revenue growth and profitability upon closing. Lumryz has generated more than $300 million in net revenue since its launch.

"This transaction represents a compelling outcome for our shareholders and a powerful validation of our strategy, execution, commercial capabilities and the differentiated value of Lumryz," Avadel CEO Greg Divis said.

Price: 31.53, Change: +0.08, Percent Change: +0.25