Executive Summary

A marketed product, a second in registration, and $300 million cash enabled Celgene to acquire a biotech capability and expand beyond its roots as a chiral chemistry company. But it took 15 years to get there. Formed as a bioremediation and chiral chemistry company in 1986, it struggled with those businesses. However, its chemical mentality led to in-licensing rights to thalidomide, which subsequently demonstrated activity in cancer. It reached profitability last year on sales of that drug, and with a chiral form of Ritalin pending approval, it finally had the resources to backfill a biology capability. Its purchase of Signal Pharmaceuticals gives it that and is its solution to the late-stage model problem of how to move beyond initial products and leverage a commercial infrastructure.