Time to beef up that revenue stream. Bristol-Myers Squibb on Thursday became the latest big pharma company to bid for a smaller rival. It offered $60 per share for ImClone Systems, the New York biotech company chaired by activist investor Carl Icahn. Bristol-Myers already owns 17 per cent of ImClone and shares the US marketing rights for its colon cancer drug, Erbitux, so the all-cash offer amounts to $4.5bn for the remaining shares.

Bristol-Myers says the offer is part of its “string of pearls” strategy to sell off its non-drug assets and buy companies and licences that strengthen its offerings in higher-priced speciality drugs. ImClone’s attraction lies in Erbitux’s potential to treat other cancers. It also has several other compounds in early testing. Bristol-Myers, like most of its competitors, is facing a “patent cliff”. Drugs representing about 30 per cent of its 2007 pharma revenue will lose patent protection by the end of 2012, according to Lehman Brothers.