Javelin Pharmaceuticals is dumping Myriad Pharmaceuticals and its $81 million takeover deal in exchange for a much, much better deal from Hospira. Javelin shares skyrocketed 63 percent this morning after it announced that Hospira will pay $141 million for the company.
Hospira not only offered $2.20 a share for Javelin--which is awaiting final word from the FDA on its application for the pain therapy Dyloject--but sweetened the deal with financing and an offer to cover a $4.4 million deal termination penalty. Myriad CEO Adrian Hobden responded by saying that "our foremost priority will be to use our substantial financial resources prudently, including to develop our promising portfolio of drug candidates." Myriad had offered an all-stock deal that would have given Javen shareholders 41 percent of the new company, with their stake growing to 45 percent in the event of a Dyloject approval.
"Our Board of Directors, after consultation with our advisors, and in accordance with our merger agreement with MPI, has determined that Hospira's proposal is a company superior proposal," said Martin Driscoll, Javelin's CEO. "Accordingly, on the evening of Friday, April 9th, we sent MPI a notice of intent to terminate our merger agreement with them. Pursuant to the terms of our merger agreement with MPI, we are now required to negotiate in good faith with them for a period of five business days. If MPI does not favorably adjust the terms of its offer, then our Board expects to enter into the proposed merger and loan agreements negotiated with Hospira."