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 the leukemia drugmaker Pharmacyclics (UNKNOWN:PCYC.DL) are up by more than 10% in premarket trading this morning after the company announced that it has agreed to a merger with AbbVie (NYSE:ABBV) for a reported $21 billion.

Per the press release, AbbVie will pay $261.25 per share for Pharmacyclics, with 58% of the buyout being paid in cash and the remaining 42% in AbbVie common stock. As such, Pharmacyclics shareholders will have the option of receiving all cash, AbbVie stock, or a mixture of the two. The deal is expected to be close by the middle of the year. 

Johnson & Johnson (NYSE:JNJ) and Novartis AG were both rumored to be close to a deal with the drugmaker, which has had its fair share of buyout rumors. But AbbVie reportedly jumped in at the last minute with a significantly larger offer late last night.

This buyout gives AbbVie access to Pharmacyclics' flagship blood cancer drug Imbruvica, which is currently approved for four different indications and undergoing clinical testing for several additional conditions. 

So what: AbbVie has been under pressure to diversify its revenue base in the face of Humira's forthcoming patent expiration in 2016. Imbruvica should go a long way toward that goal given that Pharmacyclics is anticipating US Imbruvica sales to cross $1 billion this year. Imbruvica has shown clinical activity in a variety of malignancies. Overall, analysts believe the drug can potentially generate peak sales of about $6 billion by 2020.

Now what: There is a catch with this deal, though. J&J is Imbruvica's co-developer and is therefore entitled to 50% of the drug's profits. Although Pharmacyclics does have some early stage and preclinical product candidates, AbbVie might have to explore cutting an upfront cash deal with J&J to realize much upside from this deal, especially from a top-line perspective. 

Given that Pharmacylics was trading at around half its current price at the beginning of 2015, there's been an enormous runup. From my vantage point, AbbVie's buyout looks like a good deal for Pharmacyclics shareholders.