Pharma finds deals aren't so easy

While the market speculates just which "major pharma firm" submitted that $70-a-share mystery bid for ImClone, analysts are saying that Bristol-Myers Squibb should just up its offer to $70 from $60 and be done with it. "This is a good strategic and financial deal for BMS at that price," Deutsche Bank's Barbara Ryan wrote to clients. After all, the rival offer is subject to due diligence, and as ImClone's partner on Erbitux, BMS already has a lot of the inside skinny on the company.

Meanwhile, King Pharmaceuticals is taking its bid for Alpharma to the shareholders. Spurned by its target's management, the Tennessee company is undeterred, saying it's making a sweetened $37-a-share offer to stockholders "to deliver significant value to them as expeditiously as possible," CEO Brian Markison said. At that price, King values Alpharma at $1.6 billion, a 12 percent increase over its initial offer of $33 per share. But it's just two cents more than Alpharma's market price this morning; in pre-market trading, the company's shares were up 3.5 percent to $36.98.

And just in case you were wondering why speculation that other Pharma-Biotech partnerships would turn into buyout deals hasn't come to fruition: In Vivo looked at 12 of those collaborations and found that two-thirds of them are governed by contracts that prohibit unsolicited buyout offers. For instance, Eli Lilly's deal with Amylin on Byetta includes a "standstill" proviso. But Biogen Idec could buy Elan, its Tysabri partner, if the mood struck.

- read Mike Huckman's take at Seeking Alpha
- see King's release
- check out In Vivo's partnership analysis
- see the Wall Street Journal story

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