WALTHAM, Mass. (AP) — Shares of anemia treatment maker Amag Pharmaceuticals soared Monday after it announced plans to buy Lumara Health in a cash-and-stock deal that could be worth more than $1 billion.
The Waltham, Massachusetts, company said Monday it will spend $600 million in cash and another $75 million in stock on the privately held Lumara, which makes Makena, a treatment designed to reduce the risk of premature birth.
Amag also could pay an additional $350 million if certain sales milestones are reached. Lumara Health in based in Chesterfield, Missouri.
Amag President and CEO William Heiden said in a statement that the deal gives his company an attractive new therapeutic area and fits well with their expansion plans for Amag’s anemia treatment Feraheme.
Makena generated more than $130 million in sales over the 12-month period that ended Aug. 31. It aims to reduce the risk of a premature birth in women who have previously had a spontaneous, premature delivery.
The deal has been approved by the boards of directors of both companies and Lumara shareholders. The companies expect to complete it in the fourth quarter.
Shares of Amag Pharmaceuticals Inc. were up more than 15 percent, or $3.57 per share, to $26.75 more than an hour before markets opened Monday. The stock had slipped about 5 percent so far this year, as of Friday’s market close.
