Shares of SteadyMed Ltd. (NASDAQ:STDY) surged on Monday after the company’s shareholders agreed to a buyout offer from Maryland-based United Therapeutics Corp. (NASDAQ:UTHR).
The specialty pharmaceutical company's shares popped nearly 76% to US$4.65 on news of the merger ahead of the bell, while United Therapeutics moved more modestly by 0.54% to US$111.
United Therapeutics will pay an additional US$2.63 per share in cash upon a milestone related to commercialization of SteadyMed’s Trevyent used for treating pulmonary arterial hypertension (PAH). The transaction includes US$75mln in "contingent consideration" and values the whole deal at US$216mln.
“United Therapeutics will acquire SteadyMed for US$4.46 per share in cash at closing and an additional US$2.63 per share in cash upon the achievement of a milestone related to the commercialization of Trevyent,” said a joint statement issued by the companies.
READ: United Therapeutics says Q4 net income slumps 83%, but sales beat market expectations
SteadyMed is developing Trevyent for the treatment of pulmonary arterial hypertension and combines the firm's two day, single use, disposable PatchPump technology with treprostinil.
"We are optimistic about acquiring SteadyMed and adding Trevyent to our pipeline of products to treat PAH," said Martine Rothblatt, CEO of United Therapeutics. "We are especially impressed with SteadyMed's management team and global supply chain. Trevyent fits in well with our mission."
SteadyMed shareholders owning approximately 43.3% of the ordinary shares of SteadyMed have entered into an agreement to vote their shares in favor of the merger.
"We believe that this proposed acquisition will help us realize our commitment to bring Trevyent to market to improve the lives of patients with PAH," said SteadyMed Ltd. CEO Jonathan M.N. Rigby.