More action with Big Pharma investing in biotech and they still have a lot of cash around to do so. In time we just might have all the same familiar names around but instead of Pharma they will all be biotech, the next step towards personalized medicine with enhanced research through genomic studies while clinical trials are taking place. BD
ImClone’s Erbitux is a successful cancer drug, but much of the revenues go to ImClone’s partners Bristol and Merck KGaA, which co-market the drug. So what Lilly’s really buying are ImClone’s pipeline and its biotech know-how. Those don’t come cheap these days: Lilly doesn’t expect ImClone to contribute to profits until 2013.
But pharma companies are sitting on plenty of money, though Lilly’s pile at about $2.9 billion in cash and $2.3 billion in short-term investments isn’t as high as some. Still, those companies that haven’t already bought their way into the biotech business are desperate to do so. And with good reason: As the traditional drug business gets pinched, biotech drugs — which command high prices and don’t face generic competition — are flourishing.
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