Furiex Pharmaceuticals Inc. (FURX), the drug developer whose irritable bowel treatment is moving toward regulatory approval, is working with Bank of America Corp. to find a buyer, people with knowledge of the matter said. The shares jumped.
Now that the medicine has met targets developed in conjunction with U.S. and European regulators, management believes there is less risk for buyers and has begun contacting other drugmakers to gauge their interest in a deal, said two of the people, who asked not to be named because the Morrisville, North Carolina-based company’s plans are private.
Furiex’s experimental treatment eluxadoline alleviated diarrhea and abdominal pain caused by irritible bowel syndrome in two studies, the last of three rounds generally needed for regulatory clearance. On Feb. 4, the company said it would apply for U.S. Food and Drug Administration approval to market the drug in June, sending the shares up 130 percent that day. Chairman Fred Eshelman estimated then that annual sales of the drug would be $750 million to $1 billion.
The company’s stock climbed almost 10 percent as of 12:06 p.m. in New York, giving the company a market value of more than $1.1 billion. The day before the clinical trial results were released, they traded at $45.97, for a market value of about $478 million.
Tony Plohoros, a spokesman for Furiex at 6 Degrees, declined to comment. John Yiannacopoulos, a spokesman for Bank of America, didn’t respond to a request for comment.
This is the second time Furiex has tried to sell itself, according to two of the people familiar with the matter. The company unsuccessfully ran an auction process last year, they said.