Icahn tries to buy 40 percent of biotech firm's stock; takeover defense plan may halt deal

Saturday, February 16th 2002, 12:00 am

By: News On 6

NEW YORK (AP) _ Billionaire investor Carl Icahn is seeking antitrust approval to purchase $500 million of ImClone Systems Inc. stock, roughly 40 percent of the company, prompting the biotech firm to take steps to defend itself against a takeover.

ImClone announced Friday that Icahn filed documents with the Federal Trade Commission and the Department of Justice to clear the way for him to buy the stock. In October 1999, Icahn owned 5.1 percent of ImClone, according to Securities and Exchange Commission documents. It is not known whether he still holds any of the shares.

``Our view is that Icahn's intentions are a vote of confidence,'' said Andrew Merrill, a spokesman for ImClone. ``Sophisticated investors don't make such large investments lightly.''

A plan adopted by ImClone make it prohibitively expensive for an investor to continue buying shares of the company once he controls 15 percent of all stock.

``I think the whole thing is a moot point because he can't get control now,'' Patrick Mooney, a biotech analyst at Thomas Weisel, said of Icahn.

Last fall, Bristol Myers paid $1 billion to acquire 19.9 percent of ImClone. But ImClone's stock went into a tailspin after the Food and Drug Administration refused to accept its application to review Erbitux, a cancer drug touted as a blockbuster. A rash of shareholder lawsuits and three federal investigations followed.

Bristol-Myers also wanted to restructure the terms of its $2 billion deal, but ImClone rejected that plan earlier this week.

ImClone and Bristol are meeting with FDA officials on Feb. 26 to discuss Erbitux's future.

Whether Icahn will be a part of that future is anyone's guess. He did not return calls for comment Friday.