"Its primary product is called relistor which is used to treat opioid-induced constipation and chronic non-cancer pain. The injectable version of this drug is showing good sales growth and its distribution and marketing partner happens to be none other than Valeant Pharmaceuticals. An oral version of the drug should be approved by summer and should exponentially boost sales of this compound. The two versions together should have $1 billion peak sales potential or better.

Progenics is getting a 15% royalty on all revenues and sales milestones. It will also receive a $50 million payout from Valeant upon the approval of the oral version of the compound. It might make sense for Allergan to just buy the rights to relistor from Valeant and purchase Progenics at the same time. That might be what the market is anticipating as the stock has been a strong performer recently."