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Inamed Board Takes Swiss Approach

The Medicis bid for Allergan has been delayed by a request from the Federal Trade Commission for more information. The FTC is supposed to issue an opinion on Dec. 14.

Just to make things interesting, Mentor (MNT) recently made a $2.2 billion unsolicited takeover offer to Medicis, which was immediately rejected . Mentor, based in Santa Barbara, Calif., competes with Inamed in the field of breast implants.

As with any merger agreement, the negotiations between Inamed and Allergan, as well as those between Inamed and Medicis, are filled with a host of conditions. On Tuesday, Allergan said its offer to Inamed was irrevocable as long as certain conditions were met.

For example, Allergan says it needs to conduct additional due diligence on Juvederm, an antiwrinkle product from Inamed that isn't approved for use in the U.S. yet. Allergan says it wants to "confirm that there are no material undisclosed facts" relating to the development and regulatory-approval process in the U.S.

Allergan also wants to make sure that its offer meets the requirement of the previous Inamed-Medicis agreement that allows Inamed to entertain a "superior proposal" without being cited for breaching that agreement.

Allergan says it has talked to the FTC and "is working to develop a satisfactory plan" to divest Inamed's rights to an experimental skin treatment called Reloxin. The drug is similar to Botox, and analysts say it's the key to both Medicis' interest in Inamed and the main regulatory hurdle to Allergan's takeover proposal.

The latest episode had some last-minute drama. Inamed's board actually rejected the Allergan offer because the two sides failed to reach an agreement in time for a Dec. 5 deadline, according to an Inamed filing with the Securities and Exchange Commission. Although the board's vote was unanimous, Inamed told the SEC on Monday that it "continues to be in active negotiations" with Allergan. Today, Allergan sent its updated takeover offer.

Shares of Inamed lost 4 cents to $85.25, and Medicis rose 54 cents to $34.21. Allergan was up $1.39 to $105.17, and Mentor was off 15 cents to $48.12.

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