Pharma Strategy Blog

Hah, having written about Lilly's Alimta in non-small cell cancer over the weekend, I find this morning that they were the secret suitor to ImClone Systems, who recently rejected BMS's bid.

Lilly will acquire ImClone through an all cash tender offer of $70.00 per share, or approximately $6.5 billion.

ImClone have an interesting portfolio of onoclogy drugs, including Erbitux, for the treatment of advance colorectal and head and necks cancers, as well as several promising agents in development. 

In the near term, three other agents have reached at least phase II.  These include IMC-1121B is a fully-human monoclonal antibody that targets the VEGF
receptor to deprive tumour blood vessels of the nutrients they need for
further growth. Proof of concept of this approach was first demonstrated by Genentech's Avastin.  Phase II studies are underway for metastatic melanoma,
renal, liver, ovarian and prostate cancers. Metastatic breast cancer is
in Phase III testing, while Phase III testing in gastric cancer may
begin in 2009.

IMC-A12 is a fully-human monoclonal antibody that targets the insulin-
like growth factor-1 receptor (IGF-1R). Phase II testing is underway in
breast, prostate, pancreatic, colon, liver and head and neck cancers,
as well as sarcoma, with Phase III trials planned in 2009. IMC-A12 has
the potential to work with a variety of other targeted agents.

IMC-11F8 is a potent, fully human monoclonal antibody that targets the
epidermal growth factor receptor (EGFR), the same receptor targeted by
Erbitux.  It is currently in Phase II studies for metastatic colorectal
cancer with one or more Phase III trials planned in 2009.

This move makes a lot of sense for Lilly, as cancer (neuroscience and diabetes being the others), is one of the main therapeutic areas it focuses on.  It already has Alimta and Gemzar on the market, but Gemzar is due to lose it's patent in 2012 and so it was clearly on the hunt for a company with a cancer portfolio to drive future revenue streams.  At $70 per share, the offer is a decent 13% premium over BMS's revised offer of $62 per share that was recently rejected by Icahn and the ImClone board.