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Opiant Pharmaceuticals Inc. shares traded 111% higher after the company reported it entered into a definitive agreement to be acquired by Indivior Plc. for US$20.00 per share in cash. Opiant shareholders will also receive contingent value rights that are worth up to an additional US$8.00/share if certain product sales milestones are met.

Specialty pharmaceutical company Opiant Pharmaceuticals Inc. (OPNT:NASDAQ), which is engaged in the development of medicines to treat alcohol and drug addictions and overdose, today announced "it entered into a definitive merger agreement to be acquired by Indivior Inc., a subsidiary of Indivior Plc. (INDV:LSE; IZQVF:OTCMKTS)."

Under the agreement, Indivior has agreed to pay Opiant Pharmaceuticals' shareholders US$20.00 per share in cash for each share owned, which equates to a total of US$103.2 million based upon approximately 5.16 million outstanding common shares. The company stated that the upfront US$US20.00 per share offering price represents a 111% premium over Opiant's closing share price at the end of the prior trading day (Friday, November 11, 2022).

In addition, existing Opiant shareholders will each receive a contingent value right (CVR) for each share presently owned that may potentially be worth up to an additional US$8.00 per share over a period of seven years if various milestones are achieved. The exact terms and amounts of the CVR payments are predicated upon the attainment of certain specific revenue thresholds for Opiant's investigational opioid treatment OPNT003 (nasal nalmefene).

The company listed that "pursuant to the CVRs, Indivior will pay US$2.00 per CVR if OPNT003 achieves the following net revenue thresholds during any period of four consecutive quarters prior to the seventh anniversary of the U.S. commercial launch: (i) US$225 million, (ii) US$300 million, and (iii) US$325 million. The remaining US$2.00 per CVR will become payable if OPNT003 achieves net revenue of US$250 million during any period of four consecutive quarters prior to the third anniversary of the U.S. commercial launch."

With the acquisition of Opiant, Indivior hopes to expand its portfolio of addiction therapies and plans to use its expertise and resources to advance the launch of OPNT003 as a potential new treatment for opioid overdose once regulatory approvals are secured.

OPNT003, nasal nalmefene, was described as "a high-affinity mu-opioid receptor antagonist that reduces the binding of opioids to this receptor, limiting respiratory depression, the primary cause of overdose injury and death."

The company's President and CEO, Roger Crystal, M.D., commented, "We are pleased to have reached an agreement that reflects the great potential Opiant has created with OPNT003 and our pipeline of medicines…This transaction provides Opiant shareholders with immediate value in addition to the potential future upside from the CVRs. This transaction will also enable us to leverage Indivior's commercial strength and resources to maximize the value of OPNT003 and our pipeline assets."

Indivior Plc.'s CEO Mark Crossley remarked, "Our work has never been more critical, with reported overdose deaths in the United States occurring at near-record numbers."

"Opiant's portfolio of product candidates is an excellent strategic fit that diversifies and strengthens our offerings, while Indivior's strong commercial capabilities will propel a combined product pipeline with the potential to help patients along a continuum from addiction and rescue to recovery," Crossley added.

The report indicated that the transaction is expected to close in Q1/23 and has already been unanimously approved by each company's respective Board of Directors. The acquisition remains subject to approval by Opiant's shareholders, ordinary closing conditions, and U.S. regulatory approval.

In a separate news release today, Opiant Pharmaceuticals Inc. announced financial results for the third quarter of 2022 ended September 30, 2022.

The company advised in the announcement that it settled its legal dispute with Emergent Biosolutions Inc. (EBS) in the matter pertaining to NARCAN® Nasal Spray royalty payments. The company pointed out that as the EBS license agreement ended, no associated royalty revenue was posted during Q3/22.

The firm indicated that "the settlement includes a one-time payment, termination of the license agreement, and an exclusive license relating to NARCAN® Nasal Spray to EBS." Under the terms of the settlement agreement, EBS has agreed to pay Opiant a one-time payment in the amount of US$25 million in exchange for exclusive global licensing rights for NARCAN® Nasal Spray, including licensed patents and know-how.

The company mentioned that it remains on track to submit a New Drug Application (NDA) submission for OPNT003 with the U.S. Food and Drug Administration (FDA) in Q4/22 for the use of nasal nalmefene in counteracting opioid overdose.

The firm noted that, in addition, it expects to release topline results from its Phase 2 OPNT002 study of nasal naltrexone as a potential treatment for Alcohol Use Disorder (AUD) in mid-2023.

Opiant's President and CEO Roger Crystal, M.D., stated, "We are pleased with our progress during the third quarter towards completion of our NDA submission for OPNT003 and preparations to support a potential launch next year. Our agreement with Emergent Biosolutions to buy out the royalty for NARCAN® Nasal Spray underscores our steadfast commitment to the promise of OPNT003 and provides additional and non-dilutive financial flexibility as we advance towards commercialization."

"We also achieved the completion of enrollment in our Phase 2 clinical trial for alcohol use disorder, Dr. Crystal added."

The company reported that for Q3/22, it had total revenue of US$0.2 million, compared to US$16.3 million in Q3/21. The firm stated the major difference was due to the termination of the license agreement with EBS. Opiant explained that all of the revenue registered this quarter was from its contract with the Biomedical Advanced Research and Development Authority (BARDA).

The company stated that for Q3/22, it recorded a comprehensive net loss of US$9.92 million, or a loss of US$1.93 per basic share and diluted share, versus net income of US$3.41 million, or US$0.77 per share in Q3/21.

Opiant Pharma is a specialty pharmaceutical company based in Santa Monica, Calif., that is focused on creating, developing, and delivering novel medicines for use in combatting addictions and drug overdoses. The company is credited with developing the first FDA-approved nasal naloxone spray. The firm notes on its website that in 2015, the product, now known as NARCAN® Nasal Spray 4mg, became available for distribution in the U.S. and Canada via its licensee Adapt Pharma, which later became a part of Emergent BioSolutions.

Opiant Pharmaceuticals started off the day with a market cap of around US$49.06 million with approximately 5.16 million shares outstanding. OPNT shares opened almost 116% higher today at US$20.50 (+US$9.50, +115.79%) over Friday's US$9.50 closing price. The stock traded today between US$20.08 and US$20.50 per share and closed for trading at US$20.10 (+US$10.60, +111.58%).

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