This Monday seems to be a lucrative one for investors in biopharmaceutical companies. It seems like everybody has some good news to report, whether that be optimistic trial data or a successful merger or acquisition. Flexion Therapeutics (NASDAQ:FLXN) is joining the pack of medicine plays that’s boasting bullish news today. An incoming merger between Flexion and another large pharma company is giving owners of FLXN stock something to smile about today.
Flexion is a Massachusetts-based biopharma play who deals in treating musculoskeletal ailments. The company is targeting treatments for osteoarthritis in the knees, but it also is looking to develop treatment for back pain and post-operative aids. Its most notable product is its Zilretta drug, which the company offers as a treatment for osteoarthritis.
The company is making waves today with news of its coming merger with Pacira Biosciences (NASDAQ:PCRX). This morning saw the companies announce the deal and its terms. The deal is worth $630 million, and Pacira will pay $8.50 per share for the acquisition. With shares closing out on Friday at $5.78, this puts a 47% premium on FLXN stock. The deal also calls for additional payments of up to $8 per share if certain sales conditions are met.
FLXN Stock Gains 60% on Merger News
This merger benefits both sides greatly. The deal values Flexion’s equity at $450 million, and it also will help level the company’s hefty debt. Pacira says the merger is also a wonderful addition to its portfolio. The company is heading a commitment to non-opioid pain management, and the addition of Flexion helps to further that goal. Flexion’s CEO notes the company’s commitment in its press release, stating “Pacira shares our commitment to advancing non-opioid pain control.” He adds that the company is sure to help further the commercial success of Zilretta and other Flexion products.
The biggest winners, though, are FLXN stock holders, who watched their holdings inflate to a whopping $10.11 in pre-market at their highest. Since the ringing of the opening bell, the cost of FLXN stock is rising over 57%. Additionally, trading volume is far surpassing the norm for the company; 26.3 million shares of FLXN are trading hands against a typical volume of just 1.1 million.
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.
