Health Winners & Losers: ImClone
Biotech stocks dropped as the markets plummeted at the start of the week, though some stock success stories broke through.
The Nasdaq and Amex biotechnology indices were down 5.3% and 4.9%, respectively. The Nasdaq global biotechnology index was off by 5.6%.
The only stock in the green on the Amex index was ImClone Systems (IMCL), which tacked on $1.75, or 2.7%, to $6.71 after Eli Lilly (LLY) confirmed that it bid $70 a share or roughly $6.1 billion. Eli Lilly said the offer represents a premium of 51% to ImClone's closing stock price on July 30, the day before Bristol-Myers Squibb's (BMY) acquisition offer for ImClone was made public.
Meanwhile, Bristol-Myers Squibb, which had launched a hostile tender for $62 a share, indicated it would not raise its offer. But it also isn't walking away empty-handed. The company said it owns roughly 14.4 million shares, or 16.6%, of ImClone. Considering that, the transaction is worth about $1 billion in cash for Bristol-Myers.Eli Lilly shares were down 5.4% to $39.16. Meanwhile, Bristol-Myers shares gave up 4.5% to $19.51. Turning to study results, the wait for interim data from Dendreon (DNDN) is over. Dendreon shares soared $2.67, or 52%, to $7.87, after the company said prostate cancer vaccine Provenge had a 20% reduction in the risk of death at the interim analysis. The FDA required a 22% reduction in order to grant approval based on these mid-study data, so the trial will continue, with investors waiting for a final readout in 2009.
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