Icahn: Bristol-Myers ImClone bid too low

ImClone headquarters in New York. Bristol-Myers already owns 16.6 percent of the firm. (Jin Lee/Bloomberg News)

NEW YORK - Carl Icahn, ImClone Systems Inc.'s chairman and second-biggest shareholder, said Bristol-Myers Squibb Co.'s $4.3 billion buyout offer was too low and the company may split itself to boost its value.

The bid "greatly undervalues" ImClone's lineup of experimental cancer drugs, Icahn said yesterday in a statement issued by ImClone. The drug maker is investigating whether a Bristol-Myers representative on its board shared confidential information about its experimental drugs and its plans to split off its only approved product, the cancer drug Erbitux, as a separate business, according to the statement.

Bristol already owns 16.6 percent of ImClone, and the companies share the profits of Erbitux, which had worldwide sales of $1.3 billion last year. ImClone is also developing five experimental drugs for cancer. One of those, IMC-11F8, may compete with Erbitux, and Bristol-Myers "may have no rights to market that product under its agreements with the company," according to the statement.

"The board still believes that the company's pipeline business may be extremely valuable and significantly increase shareholder value as a separate business," ImClone said. Its board's "preliminary view" is that the Bristol-Myers "offer substantially undervalues ImClone."

Bristol-Myers of New York was the world's biggest seller of cancer medicine before its drug Taxol faced competition from cheaper copies in 2001. The same year, the drug maker joined ImClone to market Erbitux. Bristol's offer follows Roche Holding AG's $43.7 billion bid on July 21 to buy all of Genentech Inc. as big drug makers seek to boost profits and gain new products from biotechnology partners.