Updated from 10:52 a.m.

Shares of

Anesta

(NSTA)

, a developer of therapeutic applications, soared in midmorning trading on its announcement that

Cephalon

(CEPH)

, a producer and marketer of treatments for neurological disorders and cancer, would acquire it in a stock deal valued at $444 million.

Salt Lake City, Utah-based Anesta finished Monday regular trading up 10 1/2, or 47.5%, at 32 5/8. Meanwhile, Cephalon finished up 5 1/4, or 8%, at 71 1/4.

Under terms of the deal, West Chester, Pa.-based Cephalon will exchange 0.4765 shares of newly-issued common stock for each share of Anesta common stock. Cephalon closed Friday at $66.

The deal values each Anesta share at $31.45, a 42% premium over its Friday closing price of 22 1/8. Anesta has agreed to a termination fee of $15 million.

The combined company will market three key products in the U.S.: Provigil, a drug that treats excessive daytime sleepiness associated with narcolepsy; Actiq, a drug that alleviates breakthrough cancer pain and Gabitril, a drug that eases and prevents partial seizures associated with epilepsy.

The transaction is expected to be accretive to Cephalon's revenue and earnings in 2001 and beyond.

Cephalon said the transaction is intended to qualify as a pooling of interests and as a tax-free exchange of shares under

IRS

regulations.

The boards of both companies unanimously approved the proposed merger, which is subject to the approval of Anesta shareholders and regulatory agencies.