06 February 2002
With $2 billion deal going south, drug firm looks to restructure
Bristol-Myers Squibb wants to "fundamentally restructure" its $2 billion pact with ImClone Systems Inc. to comarket an experimental cancer drug.
Bristol, in a news release issued late Tuesday, called on ImClone's top executives to step down temporarily while Bristol takes control of the Food and Drug Administration (FDA) approval process for Erbitux. Saying ImClone provided too little data to even consider it, the FDA on 28 Dec. refused to accept ImClone's marketing application for the drug.
On 19 Sept., the pharmaceutical giant paid $1 billion for a 19.9% stake in ImClone. Bristol also paid ImClone an additional $200 million for comarketing rights to Erbitux. And Bristol promised to pay another $300 million to ImClone when the FDA accepted the biotechnology company's application to sell Erbitux and an additional $500 million once the agency approved the drug for market.
Bristol also demanded that ImClone give it greater flexibility to sell the biotechnology company's stock.
ImClone CEO Sam Waksal and his brother, chief operating officer Harlan Waksal, have been the target of increasing criticism. Shareholders and analysts have accused them of hiding the extent of the FDA's concerns with Erbitux. Both have denied the allegations and said they've publicly disclosed the FDA's major concerns immediately after receiving the agency's refusal-to-file letter.
"We are taking this action because we believe Erbitux has great potential to treat cancer patients, and we want to move the process forward as quickly as possible," Bristol CEO Peter Dolan said in the press release.
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