Japan's Dainippon Sumitomo Pharma Co Ltd plans to offer about $2.7 billion to acquire U.S. drugmaker Sepracor Inc, a source said, in a move that it would give it a much needed U.S. sales force.

Dainippon, Japan's No.7 drugmaker in terms of revenue, would gain a sales force of about 1,000 that is familiar with central nervous disorders, to promote its experimental schizophrenia drug, which has performed well in late-stage trials.

It would also gain Sepracor's insomnia drug Lunesta, asthma drug Xopenex, and an experimental epilepsy drug.

The purchase would be the latest in a series of acquisitions by Japanese drugmakers of U.S. rivals as they seek to beef up their drug pipelines and their presence in the world's largest pharmaceuticals market.

Dainippon Sumitomo said it was not able to comment on reports of a bid for Sepracor. Its shares climbed 4.2 percent to 1,055 yen in early Tokyo trade, though some analysts said the deal looked expensive.

The deal would value Sepracor's shares around $23 each, based on the number of shares outstanding at the end of July. That would represent a premium of more than 27 percent from the company's closing share price of $18.03 on Tuesday.

The expected price was reflected in a 26.5 percent rise in the company's shares to $22.80 before they were halted on Nasdaq, pending news.

Based on projections for 2013, the deal values Sepracor at 3.5 times sales, compared with 3.1 times for the average of other specialty pharmaceutical and generic drug industry acquisitions, said Aaron Gal, an analyst at Sanford Bernstein.

It also values Sepracor at 19.4 times EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) compared with an average of 15.1 times for other deals, he said.

Arguably, Dainippon is buying a U.S. sales force which it can leverage to promote its current and pipeline products, said Gal.

We are unconvinced that this is the most sensible option for the company given the alternatives of building a sales team internally or acquiring a higher performing sales team at a more rational price.

But some argued that Dainippon was taking the easiest way into the U.S. market.

Sumitomo is seeking to develop and commercialize in the United States a late-stage candidate for schizophrenia, but they have no sales and marketing infrastructure, said Piper Jaffray analyst David Amsellem.

For a Japanese company looking to build a commercial presence in the U.S., this is an easy way to do so.

Dainippon, which sells the hypertension drugs Amlodin and Prorenal, said last month that its experimental schizophrenia drug, lurasidone, worked significantly better than a placebo in a late-stage clinical trial.

With annual sales of 264 billion yen ($2.9 billion), Dainippon has been overshadowed by bigger rivals such as Takeda Pharmaceutical Co and Daiichi Sankyo Co.

Its four mainstay products - Amlodin, Meropen, Ebastel and Pronenal - have patents that have either already expired or will expire shortly.

But its shares gained 21 percent in the year to Wednesday's close, bolstered by hopes that lurasidone will do well overseas.

Sepracor has long been the subject of takeover speculation. The company could face generic competition to Lunesta as early as 2012 if a generic drugmaker successfully challenges the company's patent, which expires in 2014. Xopenex is set to face generic competition in 2012.

Sepracor was not immediately available for comment.

Last year, Japanese drugmaker Takeda acquired U.S. biotech Millennium Pharmaceuticals for $8.9 billion, and Eisai Co Ltd acquired MGI Pharma for $3.9 billion.

Shionogi & Co Ltd also said last year it would buy Sciele Pharma Inc for $1.1 billion.

Sepracor, which is based in Marlborough, Massachusetts, reported 2008 sales of $1.3 billion.

($1=92.24 Yen)

(Writing by Toni Clarke and Edwina Gibbs; Editing by Richard Chang and Chris Gallagher)

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