Should You Buy Jazz Pharmaceuticals Stock After Its Actio Acquisition?
Actio could make Jazz's growing epilepsy franchise even stronger.
Jazz Pharmaceuticals recently purchased Actio Biosciences for $820 million, gaining control of a promising drug candidate for a severe form of childhood epilepsy. The acquisition was finalized on September 15. The $820 million payment was made immediately, with Actio shareholders potentially receiving an additional $500 million in milestone payments should their experimental oral drug ABS-1230 prove successful. This could result in a total value of over $1.3 billion for a drug that has not yet received approval.
Jazz's decision to acquire Actio was strategic, as the biotech company's drug candidate aligns well with one of Jazz's most significant business areas. Jazz already holds a strong position in the rare epilepsy market through its leading product, Epidiolex, which generated $292 million in sales during the second quarter, marking a 16% increase year-over-year. ABS-1230 has the potential to expand Jazz's epilepsy franchise into an area with virtually no existing treatment options.
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