TOKYO (AP) — Japanese drug company Dainippon Sumitomo Pharma Co. is acquiring U.S. drug maker Sepracor Inc. for about $2.6 billion in an effort to expand in the U.S. market, both sides said Thursday. Dainippon, which has largely depended on its domestic market up, said the deal will give it access to Sepracor's established sales network in the U.S., which will increase the Japanese drugmaker's overseas revenues to 40 percent of its total. It will also give it access to established drugs in the U.S. such as insomnia drug Lunesta. The Osaka-based company said it will offer $23 per share, a 27.6 percent premium over Sepracor's closing price Tuesday, through a tender offer set to start in early September. The buyout is the latest in a series of acquisitions of foreign pharmaceuticals by Japanese drug companies. It is the second-largest foreign acquisition by a Japanese company this year, behind Kirin Holdings Co.'s bid for Australian brewer Lion Nathan Ltd. earlier this year, according to data from Dealogic. Under the deal, Dainippon intends to acquire all outstanding common shares of Sepracor, based in Marlborough, Massachusetts, it said. Sepracor makes treatments for respiratory and central nervous system disorders and reported $1.29 billion in revenue in 2008. Lunesta was reponsible for almost half of those sales. "Sepracor has pursued growth through development of its unique pipeline and introduction of innovative pharmaceutical products to the market, a strategy that fits perfectly with our management philosophy," Dainippon President Masayo Tada said. Tada said his company hoped to become competitive in research and expand its international operations. In addition to Lunesta, Sepracor makes the respiratory drug Xopenex, lung disorder treatment Brovana, Alvesco for asthma, and Omnaris allergy spray. It is developing drugs for allergies, epilepsy, insomnia, depression, attention deficit hyperactivity disorder and lung disease. The U.S. Food and Drug Administration is expected to make a ruling on the epilepsy drug Stedesa by the end of January. Outside of North America and Japan, Lunesta is marketed as Lunivia by GlaxoSmithKline PLC. The sale may cap a difficult year for Sepracor. In July, the company said an experimental depression treatment failed in a clinical trial, and the FDA placed a hold on two trials studying the use of Lunesta in children. The company has been trying to extend the patents on Lunesta, which expire in 2012, by getting the drug approved for pediatric use. Sales of Lunesta were down slightly in 2008, and Sepracor expects its total revenue to decrease this year. In January, Sepracor said that it would eliminate 20 percent of its work force, or about 530 jobs, to cut costs. It also cut 410 contracted sales jobs. Adrian Adams, President and CEO of Sepracor, also welcomed the deal. Dainippon "is a leading Japanese pharmaceutical company with a distinguished history and an established, strong track record of operational and financial performance based on a number of successful product launches," he said. Dainippon said it hopes to start selling its anti-psychotic drug Lurasidone in the U.S. by 2010.