The Nasdaq and Amex biotech indices were down 2.2% and 2.6%, respectively. The Wall Street Journal reported late Wednesday that Eli Lilly ( LLY) is ImClone's ( IMCL) mystery bidder. Later Wednesday, ImClone Chairman Carl Icahn said in a release that the mystery suitor made a proposal not subject to financing or further due diligence. Negotiations are reportedly under way and the company has requested that ImClone not reveal the bidder's name until negotiations are complete. ImClone shares were trading up 35 cents, or 0.5%, at $65.70. Eli Lilly shares were down 30 cents, or 0.7%, at $43.39. Shares of Bristol Myers Squibb ( BMY), which last week announced a hostile tender for ImClone at $62 a share, were down 10 cents, or 0.5%, at $20.69. In other big biotech merger news, Roche reaffirmed that it's committed to a deal with Genentech ( DNA). Investor skepticism about the financing of the proposed $89 a share buyout has recently depressed the share price. Shares were up 20 cents, or 0.2%, at $86.70 in recent trading Thursday. In pharma news, Merck ( MRK) said Thursday that it is discontinuing the late-stage clinical development program for taranabant for obesity and will not seek regulatory approval for the drug in that indication. The company said that available phase III data showed that both efficacy and adverse events were dose related, with greater efficacy and more adverse events in the higher doses. Lazard analysts said it was no surprise as the safety and efficacy from taranabant's drug class, which includes Sanofi Aventis' Zimulti, for example, have disappointed. Merck's shares were off by 25 cents, or 0.8%, at $31.84.
Stocks soar as the gross domestic product rises at an annualized rate of 3.5% in the third quarter and continuing jobless claims fall. Gregg Greenberg recaps the action in The Real Story video (above).