ImClone Systems Inc. (NASDAQ: IMCL) had good results today, with shares closing up 6.7% at $67.94. The biotechnology company rejected Bristol-Myers Squibb (NYSE: BMY)'s offer to buy the remaining 83% of the company at $60 a share, saying it is considering a buyout offer worth $70 per share from an unidentified large pharmaceutical company. It seems that chairman Icahn has been busy.

To be sure, I was one of the skeptics when the billionaire investor last rejected BMY's offer, as was my colleague Doug McIntyre. But if this new offer is for real, then I must admit I underestimated him. Apparently, he "has been in talks with the chief executive of the pharmaceutical company that made the new offer, which would be worth about $6.1 billion." ImClone said it has not decided if the offer is adequate -- talk about playing hard ball all the way.

Bristol-Myers is ImClone's partner in selling its only product, the colon and head-and-neck cancer drug Erbitux. Analysts believe this would force BMY to offer $70 as well. A partnership between BMY and ImClone makes sense strategically. But I guess it all depends on who is the other pharmaceutical company BMY is competing with. Many pharma companies are losing sales to generic companies as their drugs go off patent, and without having much in the pipeline, but enough cash on their hands, any of them could be an interested buyer.

Some specific names mentioned by analysts include Sanofi-Aventis (NYSE: SNY), GlaxoSmithKline PLC (NYSE: GSK) and possibly AstraZeneca PLC (NYSE: AZN). Germany's Merck KGaA, which already sells Erbitux in some countries outside North America, is another likely candidate, as is Pfizer Inc. (NYSE: PFE), which has been trying to expand its portfolio of oncology drugs.

It's interesting that negotiations with the other company have been kept so tight, except for the price of course. BMY wins either way -- even if it can't get ImClone -- as it still holds 17% of BMY shares. Icahn, of course, would be a big winner too. Other options ImClone has been entertaining was spinning off the Erbitux division into a separate firm. The parent company would focus on developing drugs in its pipeline.

ImClone (NASDAQ: IMCL) implied volatility elevated prior to positive Erbitux data.

• IMCL, an oncology care company, is recently trading up $11.05 to $48.98 in pre-open trading.
  
• Merck KGaA & IMCL announced that Erbitux met the primary endpoint outcomes from the FLEX trial (a phase 3 study of 1000 patients with previously untreated non-small cell lung cancer).
  
• Goldman Sachs says, "Erbitux data in lung cancer positive for IMCL, Minor neg for DNA."
  
• IMCL October option implied volatility of 46 is above its 26-week average of 40 according to Track Data, suggesting larger price risks.

Genentech (NYSE: DNA) September volatility at 21 prior to IMCL's NCSCLC data.

• DNA is recently trading at $76 in pre-open trading, below its close of $79.15.
  
• Merck KGaA & IMCL announced that Erbitux met the primary endpoint outcomes from the FLEX trial (a phase 3 study of 1000 patients with previously untreated non-small cell lung cancer (NSCLC).
  
• DNA September option implied volatility is at 21; October is at 25. DNA's average option implied volatility over the last 26-weeks is 24 according to Track Data, suggesting non-directional near term price fluctuations.

Daily options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

Almost every single day day of last week I said the same in the morning, that futures point to a positive start. Yet it seemed the market just couldn't get a break and was hit with one economic news after another that kept bulls at bay. Once again this morning futures are positive, pointing to a higher start for stocks, and hopefully finally ending a six-day losing streak. It would be interesting to see how the market reacts a day before the midterm elections.

Part of this early positive sentiment, undoubtedly has to do with oil prices. This morning, oil prices slipped to below $59 a barrell. This is due partly due to the belief OPEC would have a hard time fulfilling its announcement to cut production and partly because the threats to disrupt production in Nigeria and the U.S. never came to pass. At the same time, OPEC President Edmund Daukoru also said this morning that there is oversupply and warned of further production cuts.

Today there are no economic data due, and this week in general will have little from the economic front. On Thursday, trade balance will be reported and that would be the major report to note. However, a number of Federal Reserve will be speaking today and the market could very well react to that.

In Corporate news:

Some companies due to report today: Anadarko Petroleum Corp. (NYSE:APC) - estimated $1.35 earnings per share, El Paso Corp. (NYSE:EP) - estimated $0.16 earnings per share, RealNetworks Inc. (NASDAQ:RNWK) - estimated $0.22 earnings per share, and XM Satellite Radio Holdings, Inc. (NASDAQ:XMSR) - estimated -$0.46 earnings per share.

Google Inc. (NASDAQ:GOOG) yesterday announced that it will test expansion of its business into offline media and will now be helping customers buy advertisements in 50 U.S. newspapers. More than 100 advertiser were invited to join the three-month test of a Print Ads service that places ads in daily papers such as the New York Times Co. (NYSE:NYT), Gannett Co. (NYSE:GCI) and the Washington Post.

Ryanair Holdings Plc (NASDAQ:RYAAY), Europe's largest low-cost airline, posted a 24% gain in quarterly profit and lifted its 2007 guidance. Shares rose more than 3% in London.

The Wall Street Journal reported this morning that General Motors Corp.'s (NYSE:GM) Rick Wagoner said that a deal between $6 billion to $7.5 billion could be reached soon with Delphi Corp. (OTC:DPHIQ) over GM's contribution on labor costs at auto-parts maker. Wagoner is touring China where GM also displayed the company's hydrogen fuel cell-powered Sequel.

Again, according to the Wall Street Journal the U.S. Justice Department, informally probing anti-competitive behavior in the private equity sector, has requested information from Merrill Lynch's (NYSE:MER) private equity arm.

ImClone Systems Inc. (NASDAQ:IMCL) and Bristol-Myers Squibb Co. (NYSE:BMY) reported mixed results from a pair of Phase III trials of Erbitux, the cancer drug.

In the radio market, in attempt to to defend its eroding market share from satellite radio and iPods, U.S. radio operators said sales of its high-definition radios will expand to Circuit City Stores, Inc. (NYSE:CC), and stations are set to air some 75,000 ads a week pushing HD Digital radio.