It was shaping up to be a fight amongst the little guys. In September, Allos Therapeutics
Istodax is in a clinical trial for PTCL and Folotyntm is in a trial for CTCL, so a head-to-head fight on multiple fronts between the one-drug wonders seemed inevitable. That is, until powerhouse Celgene
Technically, Celgene is paying only $340 million in cash up front, but it's on the hook for up to $300 million more in milestone payments for additional regulatory approvals in the U.S. and elsewhere. Celgene's investors had better hope it has to pay those additional milestones; being approved for just CTCL in the U.S. would be a fairly limited market.
With a much stronger adversary, Allos fell today. A lot. A full 12.5%, in fact.
If it falls much further, it'll look like a pretty good acquisition target for a large pharma looking to even out the playing field. Japan's Takeda Pharmaceuticals bought Celgene's former rival, Millennium Pharmaceuticals, last year. Perhaps it would like to double up? Johnson & Johnson
Another possible suitor for Allos could be Onyx Pharmaceuticals
Until a suitor comes along, Allos needs to keep a stiff upper lip. It has a lead on Celgene in PTCL, and it'll need to use this time very wisely. There's no time for sulking.
Fool contributor Brian Orelli, Ph.D., doesn't own shares of any company mentioned in this article. Johnson & Johnson is a selection of the Income Investor newsletter service. The Fool has a disclosure policy.