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The mystery bidder is Eli Lilly and Company
Chairman Karl-Ludwig Kley said Tuesday that while Merck (other-otc: MKGAY - news - people ) wasn’t prepared to bid for all of ImClone (nasdaq: IMCL - news - people ), his company would be willing to toss around the idea of a partnership for purchasing the New York-based biotech, whose Erbitux cancer treatment it markets outside of North America.
ImClone invented Erbitux, but it shares the income with Bristol-Myers Squibb (nyse: BMY - news - people ) and Merck. Neither company seems anxious to alter the terms of its marketing deal, which would complicate a third-party bid for ImClone. Bristol-Myers holds 61.0% of the North American sales rights to Erbitux. (See "Bristol Can Live Without ImClone.") Merck owns 90.0% of the drug's international rights.
Kley also said on Tuesday that his company is not the mystery bidder that Chairman Carl Icahn has said is looking at ImClone. That was not much of an admission since Merck does not seem to have the $6.1 billion, or $70 a share, that Icahn said might be on the table; the billionaire investor said the bidder would not need to seek financing.
According to Erik Gordon, a management professor at Stevens Institute of Technology, Merck might be a threat to Bristol-Myers now, giving another third party some extra cash and an insider's view on Erbitux. "Bristol-Myers doesn't need cash from Merck to close the deal, and they don't need Merck's expertise in Erbitux," said Gordon. "Merck would get a better split by teaming with someone else, if they can. Bristol-Myers can't be happy about Merck's statement that it would in effect support a rival bid."
Bristol-Myers had no comment on Kley's statements.
On the other hand, the news from Merck could be exactly what shareholders of Bristol-Myers wanted to hear. After Bristol-Myers had its offers for ImClone rejected twice by Icahn, it could be looking to up the ante. A few extra bucks from Merck would make the offer a bit more appetizing to ImClone and would keep Bristol-Myers from diluting its share price with a higher offer. Icahn rejected Bristol-Myers first offer of $60 per share, or $5.2 billion, at the same time he announced that an unnamed "large pharmaceutical company" was conducting its due diligence and was offering $70 per share for the biotech, which makes Erbitux, a blockbuster colon cancer treatment. Two weeks later, Bristol-Myers increased its offer to $62 per share, or $5.4 billion for the entire company. Icahn again refused the offer. (See " Bristol-Myers Raises The Stakes For ImClone.")
That due-diligence period ended last week and there has been no word yet as to if the mystery company was following through on its bid. There was considerable buzz about the identity of the bidder and whether it even existed. (See "ImClone and The Phantom Bidder.") When Icahn revealed the offer, he mentioned that the company would not need extra financing to conduct the transaction. Shares of ImClone rose 44 cents, to close at $62.40, while Bristol-Myers gained 5.0%, or $1.00, to close at $20.85. Merck's stock was up in Frankfurt, rising 4.3%, or 1.45 euros ($2.05), to trade at 35.40 euros ($49.96).
Merck and ImClone have been fighting about royalties payments for Erbitux that the companies are required to pay for a patent infringement. The fight has gone to arbitration, where a third party will decide if Merck should be responsible for a portion of the royalties. (See "ImClone's New Erbitux Problem.")
ImClone Systems said yesterday the mystery suitor offering $70 per share for the biotechnology company is expected this week to either make a formal offer or walk away from the deal. If the suitor withdraws, ImClone said it would disclose the name of the "large pharmaceutical company" on Wednesday.
Repligen announces settlement with ImClone in Erbitux lawsuit ...
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ImClone news - FierceBiotech
FierceBiotech is the biotech industry's daily monitor, with a special focus ... Most Popular ImClone story. Biogen Idec in play after Icahn makes his move
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An ImClone Deal Will Get Done
Right now, Icahn is doing everything he can to play up ImClone’s bargaining position in the buyout talks. For instance, ImClone’s press release yesterday discussed how it has a ...
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ImClone Deal Boosts Biotech ETFs (Exxon, Bristol-Myers, Squibb ...
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ImClone - Company Overview - Hoover's
ImClone Systems has got it in for the big "C." The biotechnology firm is focused on ... Hourly In Play (R) - 23:00 ET [Briefing.com] (25 Sep 2008 23:00:00 EDT) ...
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Germany's Merck interested, but not ImClone bidder
New York-based ImClone _ in play since Bristol-Myers Squibb Co. made a then-friendly acquisition offer on July 31 _ three weeks ago said a large pharmaceutical company it has yet to identify had made a $70 per share bid, worth about $6.1 billion.
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Source: FOX News
NewsDateTime: 9/30/2008
Sempra to wrap up acquisition
ImClone – in play since Bristol-Myers Squibb Co. made a then-friendly acquisition offer on July 31 – three weeks ago said a large pharmaceutical company it has yet to identify had made a $70 per share bid, worth about $6.1 billion.
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Source: San Diego Union-Tribune
NewsDateTime: 8 hours ago
Pfizer currently leads IGF development, metformin may enhance activity ...
... drug development related to the insulin-like growth factor (IGF) pathway, but faces competition from Roche, Amgen, ImClone ... metformin are known to reduce both glucose and insulin levels and are under study to see whether they have any role to play ...
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Source: Financial Times
NewsDateTime: 7 hours ago
Corporate report
New York-based ImClone -- in play since Bristol-Myers Squibb Co. made a then-friendly acquisition offer on July 31 -- three weeks ago said a large pharmaceutical company it has yet to identify had made a $70 per share bid, worth about $6.1 billion.
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Source: Herald Tribune
NewsDateTime: 6 hours ago
Hostiles Take Over
When ImClone Systems was approached by Bristol-Myers Squibb (which already held a 17 percent stake in the cancer-drug maker ... meriting a higher stock price, if not pricing itself out of contention altogether. At press time, the deal remained in play
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Source: CFO.com
NewsDateTime: 7 hours ago
Bristol-Myers Squibb, which employs more than 6,000 people in research and other operations in New Jersey, made an unsolicited bid for ImClone in July. ImClone, which focuses on the discovery of cancer drugs, rejected the initial $60-a-share bid as too low. Bristol-Myers last week sweetened the offer to $62 a share. ImClone chairman Carl Icahn has declined to name the mystery suitor, and Wall Street analysts speculate it could be one of a half dozen major drug companies. "That shows you that it would have to be one of the big pharmaceutical companies that are cash-rich" and probably have slow growth, said pharmaceuticals analyst Linda Bannister of Edward Jones. The companies with enough cash on their balance sheets at the start of the year to pay $6.1 billion for ImClone include Pfizer, Germany's Merck, Eli Lilly, Novartis and GlaxoSmithKline. "It wouldn't surprise me at all if Pfizer's taking a look," given ImClone is developing cancer drugs and oncology is a major therapy area for Pfizer, Bannister said. ImClone, which has major operations in Branchburg, put itself on the market in 2006, but failed to attract any bidders. When Bristol-Myers made its unsolicited offer, ImClone said it might break off the cancer drug Erbitux, its only product on the market, the cancer medicine, as a separate business. Bannister said the delay likely means ImClone is giving the suitor time to "become as comfortable as possible" with ImClone's pipeline and the question of whether Bristol-Myers retains significant rights to future sales of a successor to blockbuster Erbitux. The suitor might even lower its bid, she added. "The market's a little leery that a $70 offer's going to materialize," Bannister said, noting ImClone shares closed down 2.2 percent as the financial crisis on Wall Street battered shares of just about every sector.
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