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This excerpt taken from the LLY 10-K filed Feb 22, 2010. ICOS
Corporation
On January 29, 2007, we acquired all of the outstanding
common stock of ICOS Corporation (ICOS), our partner in the
Lilly ICOS LLC joint venture for the manufacture and sale of
Cialis for the treatment of erectile dysfunction. The
acquisition brought the full value of Cialis to us and enabled
us to realize operational efficiencies in the further
development, marketing, and selling of this product. The
aggregate cash purchase price of approximately $2.3 billion
was financed through borrowings.
The acquisition has been accounted for as a business combination
under the purchase method of accounting, resulting in goodwill
of $646.7 million. No portion of this goodwill is expected
to be deductible for tax purposes.
The other significant components of the purchase price
allocation were developed product technology (Cialis) of
$1,659.9 million, the tax benefit of net operating losses
of $404.1 million, acquired IPR&D of
$303.5 million, cash and short-term investments of
$197.7 million, deferred tax liability of
$583.5 million and long-term debt assumed of
$275.6 million. The developed product technology is being
amortized over the remaining expected patent lives of Cialis in
each country; patent expiration dates range from 2015 to 2017.
These excerpts taken from the LLY 10-K filed Feb 27, 2009. ICOS
Corporation
On January 29, 2007, we acquired all of the outstanding
common stock of ICOS Corporation (ICOS), our partner in the
Lilly ICOS LLC joint venture for the manufacture and sale of
Cialis for the treatment of erectile dysfunction. The
acquisition brought the full value of Cialis to us and enabled
us to realize operational efficiencies in the further
development, marketing, and selling of this product. The
aggregate cash purchase price of approximately $2.3 billion
was financed through borrowings.
The acquisition has been accounted for as a business combination
under the purchase method of accounting, resulting in goodwill
of $646.7 million. No portion of this goodwill was
deductible for tax purposes.
We determined the following estimated fair values for the assets
acquired and liabilities assumed as of the date of acquisition.
New indications for and formulations of the Cialis compound in
clinical testing at the time of the acquisition represented
approximately 48 percent of the estimated fair value of the
acquired IPR&D. The remaining value of acquired IPR&D
represented several other products in development, with no one
asset comprising a significant portion of this value. The
discount rate we used in valuing the acquired IPR&D
projects was 20 percent, and the charge for acquired
IPR&D of $303.5 million recorded in the first quarter
of 2007 was not deductible for tax purposes.
ICOS Corporation On January 29, 2007, we acquired all of the outstanding common stock of ICOS Corporation (ICOS), our partner in the Lilly ICOS LLC joint venture for the manufacture and sale of Cialis for the treatment of erectile dysfunction. The acquisition brought the full value of Cialis to us and enabled us to realize operational efficiencies in the further development, marketing, and selling of this product. The aggregate cash purchase price of approximately $2.3 billion was financed through borrowings. The acquisition has been accounted for as a business combination under the purchase method of accounting, resulting in goodwill of $646.7 million. No portion of this goodwill was deductible for tax purposes. We determined the following estimated fair values for the assets acquired and liabilities assumed as of the date of acquisition.
New indications for and formulations of the Cialis compound in clinical testing at the time of the acquisition represented approximately 48 percent of the estimated fair value of the acquired IPR&D. The remaining value of acquired IPR&D represented several other products in development, with no one asset comprising a significant portion of this value. The discount rate we used in valuing the acquired IPR&D projects was 20 percent, and the charge for acquired IPR&D of $303.5 million recorded in the first quarter of 2007 was not deductible for tax purposes. | EXCERPTS ON THIS PAGE:
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