Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of branded and generic drug developer Akorn (NASDAQ:AKRX) and branded, generic and over-the-counter drugmaker Hi-Tech Pharmacal (NASDAQ:HITK) soared as much as 15% and 26%, respectively, after Akorn announced a deal to buy rival Hi-Tech Pharmacal for $640 million.

So what: The deal values Hi-Tech Pharmacal at $43.50/share, or a 24% premium from yesterday's closing price, and is expected to be earnings accretive immediately for Akorn. Once completed, Akorn is set to become the third-largest drug company focused on ophthalmic (i.e., eye-related) treatments, and it would also have an expanded line of cold, allergy, and sinus over-the-counter medications to further diversify its product line. Akorn also sees cost savings hitting $15 million to $20 million annually once the deal is completed. Akorn plans to finance the deal primarily through long-term borrowing.

Now what: It's rare that you see a purchasing company jump nearly as much as the company it's buying, but that's exactly the case today. Clearly, investors are thrilled with this combination, the expected cost synergies, and the expanded product pipeline. Even prior to his deal, I was enamored with Akorn given that it planned to introduce (according to its own press release) 39 branded and generic drugs between 2013 and 2015 with a current market value of $3 billion. That's the great thing about hybrid drug developers, those that develop generic as well as in-house branded drugs: There's never a dull moment as the research pipeline is always churning. Even following today's pop, I would suggest getting Akorn on your Watchlist and doing some digging if you're looking for a solid biopharmaceutical growth story over the next decade or longer.

Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.

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