Eli Lilly and Co. and ImClone Systems have entered a definitive merger agreement under which Lilly will acquire ImClone for approximately $6.5 billion in cash. The acquisition of ImClone supports the Lilly’s strategy to increase its focus on biopharmaceuticals and adds oncology therapies Gemzar, Alimta and Erbitux to its biologics pipeline.
   
The combined companies creates a biopharmaceutical oncology franchise offering targeted therapies and oncolytic agents along with a pipeline spanning all phases of clinical development. The combined oncology portfolio will target various solid tumor types including lung, breast, ovarian, colorectal, head and neck, and pancreatic. The acquisition also expands Lilly’s biotechnology capabilities with ImClone’s development and commercial manufacturing facility, which will provide flexibility to develop and manufacture complex biomolecules.
   
“We think very highly of ImClone’s ground-breaking work in oncology, particularly its success with Erbitux, a blockbuster targeted cancer therapy, and its ability to advance promising biotech molecules in its pipeline,” said John C. Lechleiter, Ph.D., Lilly’s president and chief executive officer. “We are excited about the possibilities of improving outcomes for individual patients and building value for shareholders. This transaction will broaden our portfolio of marketed cancer therapies and boost Lilly’s oncology pipeline with three promising targeted therapies in Phase III in 2009. By bringing together ImClone’s and Lilly’s marketed oncology products, pipelines, and biotech capabilities, we are taking a very important step forward in addressing the challenges of patent expirations we will face early in the next decade. We look forward to working with the ImClone team and their partners to ensure a smooth transition.”
   
John H. Johnson, ImClone’s chief executive officer, said, “We believe this is an important step forward in ImClone’s and Lilly’s shared goal of addressing the medical needs of cancer patients around the world. The significant progress ImClone has made over the last few years is a direct result of the important contributions of our employees, and joining forces at this stage of our growth will allow us to leverage Lilly’s global capabilities and make even greater advancements in our proprietary pipeline.”
   
Erbitux is marketed by ImClone’s two partners, Merck KGaA and Bristol-Myers Squibb. ImClone co-promotes Erbitux in North America with BMS. In 2007, worldwide sales of Erbitux were approximately $1.3 billion.