What happened

Shares of Dova Pharmaceuticals (NASDAQ:DOVA), a biopharmaceutical company focused on rare blood-based diseases, leapt higher following a generous buyout offer. The European rare-disease drugmaker Sobi (OTC:SWTUY) will acquire Dova for up to $29 per share, which is around 45% more than the stock's previous day closing price. Shares were up 38.6% as of 11:35 a.m. EDT on Monday.

So what 

Sales of Dova's lead drug, a platelet boosting therapy called Doptelet, haven't been nearly as strong as expected since launching last year. Strong competition from Promacta, which is marketed by Novartis (NYSE:NVS) is largely to blame.

Man in a suit making it rain hundred-dollar bills.

Image source: Getty Images.

Second-quarter Promacta sales rose 23% to an annualized $1.4 billion. Sobi's a lot larger than Dova, which gives the biotech a much better chance to push its way into the market for platelet therapy.

Unlike Promacta, Doptelet doesn't have a scary black box warning on its label. That should make it easier to sell, but up until this July, Doptelet sales were limited to liver-disease patients about to undergo a procedure that could lead to uncontrolled bleeding.

Now what

In June, Dova Pharmaceuticals stock soared when the Food and Drug Administration approved Doptelet for the treatment of chronic immune thrombocytopenia (ITP), a rare bleeding disorder that affects around 60,000 Americans.

Doptelet could be useful for a range of disorders, but Sobi's most interested in boosting platelet production for cancer patients affected by chemotherapy-induced thrombocytopenia (CIT). The company will pay Dova $27.50 per share in cash and another $1.50 per share if Doptelet earns FDA approval to treat the fairly large CIT population.

Promacta's been able to produce blockbuster sales with a few indications that do not include CIT, which means Sobi could have the important niche to itself.