Investors in Adamas Pharmaceuticals (NASDAQ:ADMS) are off to a great week. The pharma play is getting picked up as part of an acquisition with biopharma company Supernus (NASDAQ:SUPN). The news this morning is fattening up the portfolios of ADMS stock holders.
Adamas is a California-based company that deals exclusively in treating neurological diseases. Its flagship product is Gocovri, a drug used to treat dyskinesia in patients with Parkinson’s disease. The company’s pipeline also includes coming treatments for other motor-function-relevant symptoms in Parkinson’s patients, as well as a treatment for epilepsy.
Adamas has shown strength through its products, posting big gains after Gocovri saw Food and Drug Administration (FDA) approval in 2017 before a period of volatility brought ADMS stock back down to earth. However, investors are getting excited about Adamas in an entirely new way.
ADMS Stock Booms on News of Merger With Supernus
Fellow pharmaceutical outfit Supernus is announcing today their deal to acquire Adamas. The deal is worth $400 million; it will see Supernus pay Adamas shareholders an upfront cost of $8.10 per share. It also includes an additional payment of $1 per share if Gocovri meets certain sales milestones.
The deal is part of a concentrated effort by Supernus to bolster its portfolio of Parkinson’s treatments. Supernus CEO Jack Khattar says that the deal is a “significant step to further build a strong and diverse Parkinson’s disease portfolio.” Supernus currently offers a number of different products, one of which is Xadago, a Parkinson’s treatment. Gocovri will be the next to join this slate of offerings, most of which include treatments for migraine headaches and epilepsy.
Of course, the news today precedes gigantic gains for ADMS stock. Shares of the pharma company are up nearly 75% in the early hours of Monday’s trading session. Additionally, trading volume is massively over the stock’s daily average; 26 million shares are swapping hands today against a typical day’s 205,000 shares.
On the date of publication, Brenden Rearick did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.