Indevus Pharmaceuticals has reached the end of its road. The Lexington, MA-based biotech company (NASDAQ: IDEV) said today it has agreed to be acquired by Endo Pharmaceuticals for $370 million, or $4.50 a share in cash.

The acquisition, approved by the boards of both companies, also has a sweetener clause which could kick in another $267 million, or $3 a share, to Indevus shareholders in the future if Endo (NASDAQ: ENDP) can reach certain regulatory and sales goals, the companies said today in a statement. Even without the sweetener, the offer represents a 45 percent premium for Indevus shareholders over today’s closing stock price of $3.10.

Indevus is coming off a rocky 2008. The company lost two-thirds of its stock value on June 4 after it was slapped down by an FDA request for a new clinical trial before it would approve testosterone undecanoate (Nebido), a long-lasting testosterone replacement therapy for men who lack the hormone, suffering from so-called “male menopause.” The company said it was “very surprised and disappointed,” by the FDA’s decision. But Endo, a specialty pharmaceutical company in Chadds Ford, PA, sees an opportunity to expand its portfolio, and boost its profits in 2009. The company plans to focus on urology and endocrinology.

“This merger reflects our desire to expand our business beyond pain management into complementary medical areas where we can be innovative and competitive,” said David Holveck, Endo’s CEO, in a statement.

Endo said it expects to wring out $40 million in cost savings through the deal, although it didn’t say exactly how it would do that.

Besides the testosterone replacement drug, Indevus sells histrelin (Supprelin LA) to treat precocious puberty. It has another drug in the final stage of clinical trials, octreotide implant, for acromegaly, a disease of excessive production of growth hormone.

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