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Oct.02

1:02 PM ET

Thursday, 2 Oct 2008

Lilly's "Secret" (About ImClone) Is Out--Or Is It?

Posted By:Mike Huckman

Topics:Stock Market | Corporate News | Mergers & Acquisitions | Pharmaceuticals

Sectors:Health Care Equipment and Services | Health Care | Pharmaceuticals

Companies:Eli Lilly and Company | ImClone Systems Inc. | Amylin Pharmaceuticals | Bristol-Myers Squibb Co

The Wall Street Journal unmasked the identity--Eli Lilly--of ImClone's secret suitor. A spokesman for LLY said he couldn't confirm or deny the report.

IMCL put out a press release last night saying that the mystery bidder has asked to remain anonymous.

And, interestingly, the press release no longer put a dollar amount on the "proposal" that's supposedly on the table.

That could explain why shares of IMCL are trading well below the $70 that ImClone originally claimed was the competing bidder's offer. Shares of IMCL[IMCL Loading... () ], which spiked on the news late yesterday about LLY's [LLY Loading... () ] interest, have been trading up and down today.

Miller Tabak healthcare analyst Les Funtleyder is enjoying this Carl Icahn-driven story as much as I am. In a research note to clients this morning he writes, "The kabuki theateresque news flow that this transaction has encouraged will likely continue." Icahn is a big investor in and the Chairman of ImClone. At least he's keeping things interesting for folks whose attention to the bailout story might be waning. His last statement called BMY's[BMY Loading... () ] $62-a-share offer "absurd."

Meantime, Mike King at Rodman & Renshaw is telling clients to stay on the sidelines because, "We do not envision a materially higher counter offer from Bristol." A spokesman for BMY said, "No comment," regarding the WSJ report about LLY. R&R makes a market in IMCL.

LLY bought its impotence drug partner Icos. It consistently denies that it's interested in buying its diabetes drug partner Amylin Pharmaceuticals[AMLYN Loading... () ] . But several analysts and industry-watchers think buying IMCL makes sense for LLY which, like a lot of other big drug companies, may want to increase its footprint in oncology.

No matter who gets ImClone, if anyone, what is it about this limelight-loving biotech? First, it was made infamous by a trading scandal that ensnared one of the most famous women in America. Then, one of the most colorful activist investors in the world takes a stake in it, helps revive the stock, and now is apparently orchestrating a juicy, little bidding war. As Deutsche Bank's Barbara Ryan writes in a research note to clients today, "It remains interesting. Rather than predict (the outcome), we will watch this scenario play out."