AI
Monday, November 29, 2004 4:12:52 PM
I'm sure the FTC would love the idea of lly buying ivx to suppress generic competition for zyprexa 
Eli Lilly shares fall on speculation of Ivax deal
Mon Nov 29, 2004 03:55 PM ET
CHICAGO, Nov 29 (Reuters) - Uncertainty over future sales of Eli Lilly and Co.'s (LLY.N: Quote, Profile, Research) schizophrenia drug Zyprexa sent the company's shares down more than 2 percent on Monday as investors speculated on what the large drugmaker might do if it were to lose a key patent.
Lilly and a group of generic drugmakers led by Ivax Corp. (IVX.A: Quote, Profile, Research) are awaiting a decision by an Indianapolis judge over whether copycat versions of the product could be sold in the United States.
A ruling in favor of generics would be positive for Ivax and negative for Lilly, which would lose patent protection on its largest-selling drug.
Some traders said the two companies could be in merger discussions.
"There is speculation that Eli Lilly might be interested in buying Ivax Corp.," said Jeff Shaw, head options trader at Interactive Brokers Group unit Timber Hill.
Shaw said the rumor sparked volatility in Lilly options.
Equities analysts said the activity was more likely related to the pending ruling on the $3 billion-a-year schizophrenia drug.
"It would be a sizable chunk for them to bite off and chew, and I'd be surprised if that was something they really want to do," said Richard Watson, an analyst William Blair & Co.
Lilly executives at were not immediately available for comment. Ivax executives declined to comment.
By late afternoon, options volume in Eli Lilly surged to more than 81,000 contracts, or five times their daily average, according to market research firm Track Data.
Investors also piled into Ivax calls, which give the right to buy the stock at a set price in the future.
"In Ivax, traders rushed to purchase calls that expire in December with the strike price of $17.50 (a share), with the belief there is more room to the upside for this stock." Shaw said.
Lilly's share were off 36 cents, or 0.7 percent, at $54.37 in late trading on the New York Stock Exchange, after touching a low of $53.45 in the session.
Shares of Ivax were off 17 cents, or about 1 percent, at $15.22 on the American Stock Exchange.
Eli Lilly shares fall on speculation of Ivax deal
Mon Nov 29, 2004 03:55 PM ET
CHICAGO, Nov 29 (Reuters) - Uncertainty over future sales of Eli Lilly and Co.'s (LLY.N: Quote, Profile, Research) schizophrenia drug Zyprexa sent the company's shares down more than 2 percent on Monday as investors speculated on what the large drugmaker might do if it were to lose a key patent.
Lilly and a group of generic drugmakers led by Ivax Corp. (IVX.A: Quote, Profile, Research) are awaiting a decision by an Indianapolis judge over whether copycat versions of the product could be sold in the United States.
A ruling in favor of generics would be positive for Ivax and negative for Lilly, which would lose patent protection on its largest-selling drug.
Some traders said the two companies could be in merger discussions.
"There is speculation that Eli Lilly might be interested in buying Ivax Corp.," said Jeff Shaw, head options trader at Interactive Brokers Group unit Timber Hill.
Shaw said the rumor sparked volatility in Lilly options.
Equities analysts said the activity was more likely related to the pending ruling on the $3 billion-a-year schizophrenia drug.
"It would be a sizable chunk for them to bite off and chew, and I'd be surprised if that was something they really want to do," said Richard Watson, an analyst William Blair & Co.
Lilly executives at were not immediately available for comment. Ivax executives declined to comment.
By late afternoon, options volume in Eli Lilly surged to more than 81,000 contracts, or five times their daily average, according to market research firm Track Data.
Investors also piled into Ivax calls, which give the right to buy the stock at a set price in the future.
"In Ivax, traders rushed to purchase calls that expire in December with the strike price of $17.50 (a share), with the belief there is more room to the upside for this stock." Shaw said.
Lilly's share were off 36 cents, or 0.7 percent, at $54.37 in late trading on the New York Stock Exchange, after touching a low of $53.45 in the session.
Shares of Ivax were off 17 cents, or about 1 percent, at $15.22 on the American Stock Exchange.
Discover What Traders Are Watching
Explore small cap ideas before they hit the headlines.
