Raleigh-based Salix Pharmaceuticals, which is reportedly the target of merger talks in a deal worth more than $10 billion, may have become a more likely takeover target Monday.
Why?
The FDA approved additional use for a constipation treatment to which Salix holds global rights.
The news sent Salix (Nasdaq: SLXP) shares up sharply in after-hours trading to above $162 per share. Salix had closed the day at $155.78, down $5.99 or nearly 4 percent.
Shares have surged in the last month on all the take-over talk, reaching a high of $169.17 a week ago.
The company already is in the process of merging with Cosmo Pharma.
Salix reported that the FDA gave approval to use Relistor for patients who are receiving opioids for chronic pain. Salix licensed the drug from Progenic Pharmaceuticals in 2011. The drug was approved originally in 2008.
Salix applied for wider use of the drug three years ago.
Allergan and Actavis both reportedly have targeted Salix for a takeover.
A similar drug from Nekta Therapeutics and AstraZeneca called Movantik recently was approved by the FDA, according to Reuters.
“Frequently, opioid analgesics are prescribed to manage pain in patients suffering from chronic conditions. Unfortunately, the use of an opioid can result in debilitating constipation for a significant number of these patients,” said Bill Forbes, executive vice president for Medical, Research and Development and the Chief Development Officer at Salix. “The approval and availability of Relistor for treating the underlying cause of OIC provides an important and welcomed advancement for many patients who experience constipation while taking opioids for chronic non-cancer pain.”
According to Salix, some 27 million patients are treated with opioids in the U.S. alone and constipation is a common side effect.
