Weiss Asset Management Ups Avadel Stake Amid High-Stakes Takeover Battle

BOSTON, MA – December 10, 2025 – In the rarefied air of biopharma mergers and acquisitions, every move is scrutinized. A recent regulatory filing has cast a fresh spotlight on the intense bidding war for Avadel Pharmaceuticals plc, revealing that Boston-based Weiss Asset Management LP has increased its position in the company. The disclosure, a mandatory Form 8.3 filing under Irish Takeover Panel rules, signals more than just routine trading; it’s a strategic marker in a multi-billion-dollar contest for control of a revolutionary new therapy.

On December 9, Weiss Asset Management reported a purchase of 10,000 ordinary shares of Avadel at a price of $21.3040 per share. This transaction brings its total holdings to 1,714,150 shares, a 1.76% stake in the Dublin-headquartered drugmaker. While not a controlling interest, the move is significant, coming just as Avadel is poised to be acquired by Alkermes plc in a deal valued at over $2.1 billion. The filing provides a transparent glimpse into the high-stakes arbitrage and strategic positioning that defines the final stages of a corporate takeover, especially one centered on a blockbuster drug.

The Prize: A Once-Nightly Revolution in Sleep Medicine

At the heart of this M&A frenzy is LUMRYZ, Avadel’s flagship product. Approved by the FDA in May 2023, LUMRYZ is the first and only once-at-bedtime sodium oxybate treatment for cataplexy or excessive daytime sleepiness (EDS) in adults with narcolepsy. For decades, patients have relied on twice-nightly formulations, requiring them to wake up in the middle of the night for a second dose. LUMRYZ represents a paradigm shift, a testament to the kind of patient-centric innovation that can disrupt an entire therapeutic class.

The market has responded with force. Avadel’s financial results tell a story of explosive growth. The company reported $77.5 million in net product revenue for LUMRYZ in the third quarter of 2025 alone, a 55% surge over the prior year. With full-year 2025 revenues projected to land between $265 million and $275 million, the drug’s trajectory has made Avadel an irresistible target.

Beyond its current indication, the future value locked within Avadel’s pipeline is a major draw. The company is in the late stages of a pivotal Phase 3 trial for LUMRYZ in treating idiopathic hypersomnia (IH), another debilitating sleep disorder. With patient enrollment nearing completion and topline data expected in 2026, a successful outcome could significantly expand the drug's market and, by extension, its revenue potential. This is precisely the kind of value catalyst that attracts both strategic acquirers and savvy investors.

A Dramatic Bidding War Nears its Climax

The path to acquisition has been anything but smooth. The battle for Avadel began in earnest on October 22, 2025, when Alkermes announced a definitive agreement to acquire the company for up to $20.00 per share. The deal included a contingent value right (CVR) tied to the future FDA approval of LUMRYZ for IH.

However, the story took a dramatic turn on November 13, when Danish firm H. Lundbeck A/S swooped in with an unsolicited, and superior, proposal of up to $23.00 per share. For a moment, it appeared Alkermes might lose its prize. Yet, in a swift countermove on November 19, Alkermes returned with a revised offer that ultimately won the day: $21.00 per share in cash plus a $1.50 CVR, bringing the total potential consideration to $22.50 per share. Avadel’s board approved the amended deal, noting that the terms of Alkermes’ CVR were more favorable and achievable than Lundbeck's, which was tied to ambitious sales milestones.

With the deal expected to close in the first quarter of 2026 pending shareholder and Irish High Court approval, the stage is set. The recent expiration of the HSR Act waiting period on December 8 removed a key regulatory hurdle, pushing the acquisition closer to the finish line.

Decoding the Investor Playbook

This is the context in which Weiss Asset Management’s Form 8.3 disclosure becomes so compelling. These filings are a requirement under Irish takeover law for any entity holding an interest of 1% or more in a target company. They are designed to prevent secret stake-building and ensure market transparency during a sensitive offer period. Weiss’s purchase, executed at a price just cents below Alkermes’ cash offer, points to a classic M&A arbitrage strategy.

“Investors in these situations are often betting on the certainty of the deal closing,” explained a market analyst who follows M&A arbitrage. “By buying shares slightly below the offer price, they aim to capture the spread when the acquisition is finalized. It’s a game of inches, but on a large volume of shares, it’s a highly profitable one.”

Weiss’s 1.76% stake also gives it a voice. With institutional ownership of Avadel hovering around 80%, every block of shares matters. Large holders like Janus Henderson, BlackRock, and Vanguard will ultimately decide the fate of the Alkermes bid. While Weiss’s position isn't large enough to single-handedly sway the vote, it adds to a complex tapestry of investors, each with their own financial calculus. Some may be long-term believers in Avadel’s technology, while others, like arbitrageurs, are focused purely on the transaction's completion.

This heightened interest from sophisticated funds underscores a broader confidence in the deal’s fundamentals and the intrinsic value of Avadel’s assets. The purchase sends a signal to the market that knowledgeable investors see a high probability of the acquisition closing at the agreed-upon terms, if not a slim possibility of further drama.

The Future of Narcolepsy Treatment Post-Merger

The consolidation of Avadel into Alkermes is set to reshape the competitive landscape for narcolepsy therapeutics, a market projected to exceed $6 billion by 2030. Alkermes will gain a powerful, fast-growing asset in LUMRYZ, positioning it to compete more aggressively against other players in the space. The combined entity will have the financial muscle and commercial infrastructure to maximize LUMRYZ’s reach and accelerate the development of its pipeline, including the IH indication and a next-generation, low-sodium oxybate formulation.

For patients, this consolidation could mean accelerated access to innovation and more robust support programs. For the industry, it's a powerful reminder that a single, transformative technology can command a multi-billion-dollar premium. As the transaction moves toward its conclusion, the focus will shift from shareholder votes and regulatory filings to the complex task of integration. The successful fusion of Avadel’s nimble, high-growth culture with Alkermes’ established infrastructure will be critical to realizing the full potential of this acquisition and delivering on the promise that LUMRYZ holds for thousands of patients living with chronic sleep disorders.