There's one sure way to get rid of competitors for your lead drug: Buy them. Yesterday, Eli Lilly (NYSE:LLY) protected its near-blockbuster Forteo by announcing that it was acquiring the rights to a potential rival osteoporosis compound from privately held TransPharma Medical.

In exchange for $35 million up front and the possibility of future milestone payments and royalties on its sales, Lilly in-licensed TransPharma's ViaDerm-hPTH (1-34), which is currently in a phase 2 head-to-head study against Forteo. Both drugs contain versions of a hormone that can help with osteoporosis, but Forteo is a once-a-day injection, while TransPharma's drug is a patch.

The osteoporosis drug market has heated up in recent years, with numerous compounds winning approval to help treat the condition. Roche and partner GlaxoSmithKline (NYSE:GSK) got the FDA's nod for a once-a-month version of their Boniva pill in 2005; last year, Novartis (NYSE:NVS) won approval for its once-a-year dosed Reclast; and Amgen (NASDAQ:AMGN) is trying to bring its own biopharmaceutical treatment onto the market as well.

Forteo has been on the market in the U.S. as an osteoporosis treatment since 2002. Last year, Lilly's Forteo revenue rose 19% to a tad more than $700 million, so even stealing a portion of Forteo's market share would have been meaningful for TransPharma. By acquiring this potential competitor, though, Lilly is able to turn what would have been yet another Forteo rival into another way to woo patients put off by Forteo's injections. All in all, not a bad deal.