Weiss Ups Stake in Avadel as $2.37B Alkermes Buyout Looms

BOSTON, MA – December 12, 2025 – In the high-stakes theater of biopharmaceutical mergers and acquisitions, every move from a significant investor is scrutinized. This week, a regulatory filing from Boston-based Weiss Asset Management LP has turned heads, revealing an increased stake in Avadel Pharmaceuticals plc just as the Irish drugmaker prepares to be acquired by Alkermes plc in a deal valued at $2.37 billion. The disclosure, mandated by Irish takeover rules, signals more than just a routine portfolio adjustment; it represents a calculated financial maneuver in the final act of one of the year's most compelling buyout sagas.

On December 12, Weiss Asset Management filed a Form 8.3 with the Irish Takeover Panel, indicating it now holds 1,812,749 shares, or a 1.86% interest, in Avadel. The filing was triggered by a recent purchase of 37,325 shares at a price of $21.4120 per unit. This move is particularly noteworthy given that it comes after Avadel’s board agreed in November to accept Alkermes's offer of $21.00 per share in cash, plus a contingent value right (CVR) of up to $1.50 per share. Weiss’s decision to buy shares at a price above the cash offer suggests a strong conviction in Avadel's value, either through the successful payout of the CVR or the potential for further drama before the deal closes in early 2026.

The Asset Driving a Bidding War

At the heart of this corporate contest is LUMRYZ, Avadel’s blockbuster drug for narcolepsy. Approved by the FDA in May 2023, LUMRYZ is the first and only once-at-bedtime sodium oxybate treatment for excessive daytime sleepiness or cataplexy in adults and children with the debilitating sleep disorder. This once-nightly dosing regimen represents a significant quality-of-life improvement over the established standard of care, which requires patients to wake up in the middle of the night for a second dose.

This innovation has allowed Avadel to rapidly disrupt a market estimated to be worth over $3 billion. The company's financial performance underscores this success. In the second quarter of 2025, Avadel reported LUMRYZ net revenue of $68.1 million, a staggering 64% increase from the prior year, and achieved its first-ever quarter of net income at $9.7 million. Buoyed by this momentum, the company raised its full-year 2025 revenue guidance to a range of $255 to $265 million.

This powerful commercial trajectory and a pipeline that includes a low-sodium version of its flagship drug did not go unnoticed. The value proposition was clear enough to spark a fierce bidding war between Alkermes and Danish pharmaceutical firm Lundbeck. After an initial offer from Alkermes in October, Lundbeck entered the fray, leading to a revised, and ultimately successful, bid from Alkermes that secured the approval of Avadel's board. The battle for Avadel is a textbook example of how a biopharma company with a single, de-risked, and highly differentiated asset can become a prime target for larger players seeking to acquire growth.

A Strategic Play in the Endgame

Weiss Asset Management’s disclosure under Irish Takeover Panel rules is a direct consequence of this acquisition activity. A Form 8.3 is required from any entity holding 1% or more in a company that is the subject of a takeover offer. The rule is designed to promote market transparency and prevent the covert accumulation of shares that could influence the outcome of a deal. By crossing this threshold, Weiss is now a declared "interested party," and its future dealings in Avadel stock will be publicly reported.

The firm's decision to increase its stake at this late stage is telling. Buying shares at $21.4120, a premium to the $21.00 cash consideration from Alkermes, indicates a belief that the total value of the deal will exceed that purchase price. This is essentially a bet on the CVR, which is tied to the expanded approval of LUMRYZ by the end of 2028. A sophisticated investor like Weiss has likely calculated a high probability of that milestone being met, making the CVR's potential $1.50 payout a key part of its investment thesis.

However, other interpretations exist. "When a sophisticated player buys in above the cash offer price, they're not just endorsing the deal; they're often betting on a better outcome," noted one market analyst familiar with takeover arbitrage. This could mean positioning for the unlikely event of a last-minute competing bid or leveraging the stake to influence shareholder votes. Several law firms have already announced investigations into the fairness of the Alkermes offer, suggesting that some investors may feel the $2.37 billion valuation still undervalues Avadel's long-term potential. Weiss's 1.86% stake, while not controlling, adds weight to the cohort of institutional investors who will have a significant say in the deal's final approval.

A Bellwether for Biopharma M&A

The Avadel saga, now punctuated by Weiss Asset Management’s latest move, serves as a powerful bellwether for the broader health tech M&A landscape. It highlights a clear trend: large pharmaceutical companies are increasingly willing to pay a substantial premium for innovative, de-risked assets that address clear unmet patient needs and offer a simplified treatment paradigm. Avadel's journey—from clinical development and navigating patent litigation with Jazz Pharmaceuticals to a successful commercial launch and a multi-billion-dollar exit—provides a roadmap for smaller biotechs.

The intense interest in LUMRYZ demonstrates that a single, well-executed product can be more valuable than a sprawling but unfocused pipeline. For investors, the story is a lesson in identifying companies that have successfully navigated the treacherous path from lab to market. The final chapter, which will see the deal close in the first quarter of 2026, is still being written. Weiss Asset Management's increased holding ensures it will be an active reader, and perhaps an editor, of that concluding narrative. The move is a reminder that even when a deal appears done, strategic investors are always searching for an edge, decoding the fine print to unlock value right up to the very end.