Replies to post #36740 on Biotech Values

[DewDiligence]

Re: Biotech M&A

>…to me it seems LLY got the best value for the dollar at least in the near term.<

The LLY-ICOS deal may have been a good value for LLY, but it was not an especially interesting deal because the impetus was largely the elimination of duplicate SG&A expenses as has been the case in dozens of similar deals over the years.

MRK’s takeover of RNAI, on the other hand, was based on acquiring some genuinely promising drug candidates, gaining access to unique technology, and keeping said technology away from competitors.

It’s the third item above (keeping technology away from competitors) that made RNAI so much more valuable to a Big Pharma than as a standalone company. When viewed in this context, the >100% premium that MRK paid is not that surprising.