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DBL%20Hendrix%20small.png College chemistry, 1983

Derek Lowe The 2002 Model

Dbl%20new%20portrait%20B%26W.png After 10 years of blogging. . .

Derek Lowe, an Arkansan by birth, got his BA from Hendrix College and his PhD in organic chemistry from Duke before spending time in Germany on a Humboldt Fellowship on his post-doc. He's worked for several major pharmaceutical companies since 1989 on drug discovery projects against schizophrenia, Alzheimer's, diabetes, osteoporosis and other diseases. To contact Derek email him directly: Twitter: Dereklowe

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May 21, 2009

J&J Lowers the Boom

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Posted by Derek

As predicted here (and everywhere else that's looked at this deal), Johnson & Johnson is not sitting back and letting Schering-Plough "take over" Merck - not when that would mean billions of dollars of lost revenue, they're not. Today the company has filed a notice of intention to arbitrate.

"As the public statements make clear, Merck is acquiring Schering-Plough", the company says, and that triggers an arbitration hearing under their agreement with them for sales of Remicade (and the newer agent, Simponi). Merck continues to insist that their strategy is bulletproof, and I guess we'll find out who's right. It could take months, unless Merck is willing to walk away from that revenue stream (and they're probably not).

Interestingly, that Wall Street Journal link quotes a "person familiar with the matter" as saying that Schering-Plough turned to J&J after Merck made its initial overtures. J&J passed on the chance to acquire the whole company, though, leaving Schering-Plough no choice but to act as if an offer from Merck was the answer to one of their most longstanding prayers.

Comments (3) + TrackBacks (0) | Category: Business and Markets


1. Hap on May 21, 2009 2:08 PM writes...

Kevlar doesn't do much good when you get run over by a tank. Or immolated by napalm. Or tied into a pretzel.

Somebody's lawyers are going to be proven incompetent - either Merck's (for weraing kevlar and challenging a tank) or JJ (for leaving a hole in the contract large enough to drive a Plough through). Should be entertaining.

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2. researchfella on May 21, 2009 8:09 PM writes...

Hey, what about the other complaint recently filed that just hit the news?
Onyx v. Bayer

Looks like this will be ugly.

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3. Industry Guy on May 22, 2009 7:20 AM writes...

That Bayer Onyx thing is FUNNY. I'm hoping Onyx or Bayer has to contact some of the Ex-Wonder Drug company laid off and fired employees who were in the know to testify. I'd be sure they pay off my mortgage for them 1)not to blast their little underhandedness if I were Bayer and 2) to help them gain potentially 1 Billion dollars if I were Onyx...

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