Otsuka Pharmaceutical says it will spend $3.5 billion in cash to buy Avanir Pharmaceuticals in a deal that expands the Japanese drugmaker's neurologic disease treatment portfolio.
Avanir makes Nuedexta, which treats a condition called pseudobulbar affect. The ailment is associated with brain disease or injury that involves involuntary emotional outbursts such as laughing or crying. Nuedexta brought in $94 million in revenue in the year that ended last June.
Avanir, based in Aliso Viejo, California, was founded in 1988 and also has developed a potential treatment for agitation associated with Alzheimer's disease. That drug is in late-stage testing.
Otsuka Pharmaceutical Co. Ltd. employs more than 28,000 people and is a subsidiary of Otsuka Holdings Co. Ltd.
Avanir shares are climbing in premarket trading.