2 Min Read
(Reuters) - Pernix Therapeutics Holdings Inc (PTX.O) said it would buy the U.S. marketing rights for a migraine treatment developed by GlaxoSmithKline Plc (GSK.L) and Pozen Inc POZN.O for an upfront payment of $250 million.
Pernix's shares jumped as much as 42.5 percent in early trading on the Nasdaq.
The deal will nearly double Pernix's revenue by allowing it to expand its presence in the neurological market, the company said on Wednesday.
Pozen will get a warrant to purchase 500,000 Pernix shares, or about 1.3 percent of its outstanding stock, at Tuesday's closing price of $4.28.
The drug, Treximet, was approved by the U.S. Food and Drug Administration in April 2008 to treat acute migraine attacks in adults.
Pernix plans to the expand the use of the drug for children and expects to file for regulatory approval by the end of the year.
The company said the agreement is expected to close by August 1 and that it will make royalty payments on net sales of the product. Glaxo (GSK.N) was marketing the drug in the United States.
Mount Pleasant, South Carolina-based Pernix's shares were up 40 percent at $6.01. Pozen's shares were slightly lower at $8.68.
Reporting by Natalie Grover in Bangalore; Editing by Savio D'Souza