By acquiring ImClone, Lilly will gain a marketed cancer drug, Erbitux, and control over ImClone's know-how in developing and manufacturing biologic drugs. Lilly will also gain ImClone's pipeline of five cancer drugs in various stages of early- and mid-stage clinical trials. This would beef up Lilly's internal cancer drug pipeline. "This strategic combination will create one of the leading oncology franchises in the biopharmaceutical industry, offering both targeted therapies and oncolytic agents along with a pipeline spanning all phases of clinical development," said Lilly in a release. Eli Lilly said it will incur a one-time charge to earnings for acquired in-process research and development, but can't estimate now the amount of the charge. The company expects the transaction to be accretive to earnings on a cash basis in 2012. Certain entities associated with ImClone Chairman Carl Icahn, who hold about 14% of ImClone's outstanding common stock, have agreed to tender their shares to the offer. It was reported last week that Eli Lilly was ImClone's mystery bidder. Icahn said the mystery suitor made a proposal not subject to financing or further due diligence. Negotiations were reportedly under way last week and the company requested that ImClone not reveal the bidder's name until negotiations were complete. "We feel that the Eli Lilly transaction vindicates our decision to oppose in 2006 a potential transaction in which the company would have been sold at approximately $36 per share which the prior board favored," said activist investor Carl Icahn, chairman of ImClone's board of directors.