can you image a shanghai hospital, if you have a gene for a lung cancer, loxo could be a lifesaver.nitially eli lilly took a hit loxo's technology is visionary and now belongs to lilly and the stock went higher because of it. for a long time when we thought of pharma, we thought of drugs for the same old remedies. sales forces that pushed product. but that is no longer the case that is what is so exciting about being out here take novartis, a doctor, got a master degree of public policy from harvard and happens to be an actual scientist. this guy is reinventing it maybe solutions, i do. many of which could be turned out to be blockbusters that produce billions of shares you will hear from him later tonight. pay close attention to what he is doing with gene therapy, and heart therapy. how about emma wongsly who runs glaxo. yielding 5%. really exciting. that is what many investors want from big pharma, but not me. i want breakthroughs, life saving products. until they got there, the product didn't seem it could innovation walmsly could combined products. number one or number two brand

i have to buy qep now that it is down a lot loxo, i have to start buying biotech.the companies are stepping up because the etfs have brought things down >> it is an interesting point you make and the companies, i mean, that -- if you want an arbiter for real value, there it is, right, active m&a, jim as we have reported, of course, celgene and bristol-myers had talked for years off and on, two to three years, it only really became a true possibility for bristol-myers to buy it over the last four or five months in september when they first made their foray in part because of what you're talking about. and the fact that there are value buyers out there, seeing as you say, six times earnings for celgene, where it was traded prior to the deal or other deals, you mentioned qep as well, which we got some news out on this morning also from elliott stepping up there. small deal but nonetheless saying we want to buy it at 45% premium we'll see if this continues, jim. it certainly is, you could argue, a positive sign i guess that's what you are arguing, right >> yes look, le

celgene last thursday, loxo today. this is something your company is involved in. you have market capitalization of about $9 million and you can see where i'm going here. if somebody called you and said iwe are intereste buying your company, what would you say to them? well, i can tell you we've been working on this for the last ten years, and i have never in the last ten years been more excited about the future than now. and so what i would say is we can't wait to keep doing the work that we're doing, especially with our partner at the mayo clinic. i'd much rather do that from a position of being able to make thecisions and innovate in a way that can help people. that isndur goal it's going to continue to be our goal. >> kevin conroy, the ceof exact sciences, thanks again for joining us tonight. appreciate it. thank you. >>> it is time to take a look at some of today's upgrades and downgrades. google's parent,al abet, was upgraded from buy to hold. the dominant digital ad businesd ay it is better managed that facebook. the price target -- general motors was upgrad

pharma giant betting big on loxo's first commercial cancer drug, which it released last year with buyer marks the second multi-billion dollar firm. a deal of the new year this comes, of course, after bristol-myers squibb announced last week it was buying cel-gene after a look at how the companies reacted, loxo oncooling up a whopping 66%. eli lily, little change. now, keeping in the pharma space, the chief executive of novartis says the company will focus on developing core innovative medicines after spinning off eye care company. he made the comments in an interview with jim cramer. >> my conviction we need to focus the company and focus the capital. there is so much great science there is so much possibilities in cell and gene therapies in our core pipeline. we can't use our capital across all of the different areas we're in what we're doing with alcon is a spin, the tax neutral spin, to our shareholders say, shareholder, look, you get to own alcon, which is a leading medical devices company, leading in its space, great company with a great outlook. you have the opportunity now to own

lock so -- loxo had its first fda approval for a cancer drug that treats tumors across cancer types, is not this or that sort of cancer. it is if your tumor has a very specific marker. this is a cutting edge area of oncology, a really exciting space a lot of companies are looking at. , we've seen buyer deals get on a path where biotech companies don't have an approved drug. loxo has a few other things that executives are excited about that they spoke about on the call this morning. it is a big premium, certainly a big deal price, at least by lilly standards. what other companies are left now? one analyst at the beginning of the year said there wouldn't be any big deals. there are already two. are there more to come? reporter: i think absolutely. we are in the middle of the jpmorgan health care conference for this industry, so that is why we are seeing a lot of splashy announcements this morning. celgenek we got a huge -bristol-myers news. if a company like celgene is billion,en out for $74 some of these other companies we've always thought of as a choirs -- as a choir -- as acquirers

loxo does.lain what has it been doing so far in what's in their pipeline?n interesting company, working on one of the most cutting areas of oncology. it's known as precision medicines a rather than working on cancer drugs that target lung cancer or breast cancer or whatever the case may be, they work on drugs that target mutations.netic they won their first fda approval last november. that drug is tumor agnostic which means it's targeting a specific genetic marker of cancer tumors rather than where those tumors are in the body. prices haveeems been gyrating wildly for these pharma companies. how are analysts pricing them? how are management teams and investors pricing them? >> that's what has been interesting. 2018, after tax reform, analysts and investors, we thought we &auld go get investors with m a few big deal to not as many people expected because valuations were so high for most of the year. of the year, we got that massive selloff in the veryt which hit biotech hard. many of the valuations came down even though we are seeing large premiums on a deal

the acquisition of biopharma company loxo oncology. >> we like to grow our presence in oncology.ood set of medicines because there's so much exciting science for patients so many things to invest in. particularly attractive to us because it's so rational that you can detect the kind of problem with the tumor growth and block it directly. >> jim cramer joining us now what do you think is most interesting for investors about this loxo deal >> what i like about it is that this is targeted, this is the way of the future. this company is actually a device company what you think about it it finds early on where the tumor might be to the point where you can still address it before you get to a lot of a nastier level. and dave is a very forward thinker. he would not have bought this if he didn't think five or six years from now would be the standard. >> also spoke with the ceo of bristol-myers. biggest health care deal, jim, i think ever but first listen to what bristol's ceo had to say about it. >> it's the right deal at the right time we are creating an extraordinary company with a foc

not surprisingly the target company, a loxo, that is up something like 65 1/2%. lilly paying significant premium, up almost, 70%. loxo is worth more than you judged by the premium than it was ever as an independent company. that shows you how much eli lilly wanted company. pricewaterhousecoopers one of the consulting firms says there is more like this to come. alluded to the fact with cancer treatments, when patients are paying for drugs, the pharmaceutical companies are reaping anywhere between 60, to 80% premium and these pharmaceutical companies don't actually have to pay a sales force. a high cost sales force the same extent they do with other kinds of treatments, neil. neil: analogy of built-in babe ruth. you just bought babe ruth. jonathan, when you look at the sector, do you like it or all of sudden change valuation, far from encouraging deals it might inhibit them? >> no, neil. deirdre is right on the money. this is quietly one of the strongest performing sectors in 2018. everything fell apart in the fourth quarter. up until this point it was big cat phar

fomc minutes then jay powell will be giving a speech happening in the last hour, eli lilly buying loxon the industry following last week's big deal >>> all right. coming up, dom chu has your morning market movers. plus citigroup's robert buckland will be our guest. plus then at 8:00, wilbur ross will be our guest to discuss the government shutdown, trade, and much more. "squawk box" will be right back. for your heart... your joints... or your digestion... so why wouldn't you take something for the most important part of you... your brain. with an ingredient originally discovered in jellyfish, prevagen has been shown in clinical trials to improve short-term memory. prevagen. healthier brain. better life. >>> time now for a look at what's moving in the premarket dom chu joins us now with more what is moving, dom? >> a whole heck of a lot, joe, of biotechnology, biopharma, large cap pharmaceutical companies. we have the spdr etf as well spdr health care etf, by the way, one of the larger ones out there. all of this is on the heels of that big deal by, of course, loxo oncology and eli lill

that is how we plan our business and what we are focused on, and things like loxo is a good it will improvewhat we have done before. that is what innovation is and what we are here to do, make that medicines for americans. taylor: what can we expect in terms of updated guidance for 2020? dave: we convened at the end of december with investors and laid out our 2019 plan. we raised our guidance expectations from $5.90 to six dollars per share, including the spin.s of the ongoing once that occurs, we will reinstate those for the part of the company we no longer own, and then we also raised expectations for 2020. in 2016, we should midterm had 5% salesch growth from 2016 to 2020 and raise that to 7% for the farmer business and confirm -- pharma business. deal, we are reaffirming those numbers for 2020. taylor: so we will have to have you back on to confirm the 30% operating margins. thank you. that was daybreak's, the eli lilly ceo in sandbox -- that was dave ricks, the eli lilly ceo. guy: more coming from that conference, i assure you.back to the breaking we had that, deutsche bank come at the

in pharma, eli lilly will acquire loxo. >> this is the largest transaction eli lilly has ever done accordingerg data. it is interesting. there are paying about $8 billion, and investors seem to like it. it is certainly a premium price, but they do have a premium product. it is less risky. >> it is an incredible little company that took advantage of breaking science that allows doctors to identify the exact reason tumors are growing through genetic testing and then they make a drugs but block that action. it is entering the world of what we call precision medicine. it adds to our oncology business. the kind of transaction we said we would be interested in. strong innovation, compelling data from patients in terms of survival rates and complete response rates. we are excited to add it. >> german industrial production took a big step down in the last year, raising the prospect of a technical recession and european economic confidence has fallen to its lowest level in nearly two years. what is going on? >> well, i will tell you i think markets are shrugging this off. this is data from november a

buy loxos agreed to oncology. we'll be talking to a chief executive later on.his is bloomberg surveillance. i'm viviana hurtado. in theransaction pharmaceutical industry. eli lilly has agreed to buy loxo oncology for about a billion dollars in cash, representing a premium to the closing cost him friday. it develops cancer drugs. in a year when stocks fell, bridgewater associates stood out. bridgewater's pure alpha strategy fund rose 14.6%. it trades globally across more than 150 markets. bridgewater is the largest hedge fund manager. apple and samsung have announced a deal that would have seemed unthinkable. the iphone maker will begin offering movies, tv shows on samsung tv sets. the arrangement demonstrates apple shift to developing into a medium service company. that is the business flash. ray so glad you mentioned dalio. francine, go ahead. francine: i was going to bring you up today with some of the headlines we had from the spokesperson of theresa may, saying they will set up a cabinet committee of no deal preparations. they said theresa may has spoken to

making a strategic purchase of a oncology companies that developed a lot of cancer treatments called loxo oncology. that stock flew 65% higher. ge closing up for the sixth session in a row. ge up better than 5 1/2%, on the idea that private equity firm apollo global management may seeking a buyer, maybe helping ge to get a buyer for its airline leasing division. a lot of analysts say that could be worth up to $40 billion for ge. that company going through a huge restructuring trying to sell off parts of its business, spin off of others. a standout stock on that news. keep in mind the larger context, we know the company had very rough 2018. the stock was down around 55% in the past 52 weeks. so underperforming the s&p 500 7% plus or minus in that time period as well. melissa. melissa: deirdre, thank you. connell: with stocks climbing today, we had the latest round of u.s.-china trade talks kicking off over in beijing. let's find out more about that. edward lawrence is at the white house with what we know. edward? reporter: connell, very positive talks or information coming out of that meet

. >>> welcome back to "fast money," eli lilly purchased loxo oncology, the deal sent the etf that tracks the biotech space up more than 3% nearly 10% since the start of the year jim cramer sat down with a number of ceos in the space at the annual j.p. morgan health conference here's what the ceo had to say about growth at its company. >> we have four areas of big growth right now we have cancer portfolio growing, cardiovascular portfolio growing, bone health and migraine and then nugs we're launching biosimilar medicine which is we expect to be an important source as well so we expect to be a company that continues to grow handsomely on the top line and earnings per share over the long term. >> for the full interview with jim cramer and the ceo of amgen, stick around for "mad money" at the top of the hour. so should investors keep betting on biotech and the health care space? two major acquisitions in two weeks. >> i think so. this is not monday morning quarterback stuff. this is something we've been saying for some time, probably since earlier in the spring. i do think valuations are st

back in july, loxo traded 192.lily looked it over and passed based on how much it would have passed at the time. that was an opportunity for little by because it meant this acquisition was suddenly affordable finally there's bristol-myers purchase of celgene for $74 billion. this gigantic deal is a textbook example of what i'm talking about right now, right here. sure it seems like bristol-myers is paying a big premium, but wait a second, 66 bucks, celgene's stock was selling at an almost impossibly cheap six times earnings this deal only works because the pow pow bear market crushed the group causing celgene's stock to plummet. at these levels the darn thing was too cheap for bristol-myers not to buy it. it was too cheap because biotech had fallen out of favor with the wall street fashion show bristol-myers doesn't care about the fashion show it cares about earnings and new drugs in the pipeline. celgene has both, which is why this deal will be so beneficial to bristol-myers shareholders. we know from the big bank

among the biggest movers today is loxo oncology a 60% plus premium and this is not a beaten up bio techs up 66% last year and up even more than that the year before but we're also seeing some research propelling stocks higher sage therapeutics with strong results for postpartum depression drug. this is a loser last year. today a big lift a number of other companies announcing results at the jpmorgan health care company and bob mentioned retailers. look at the gainers here not just tech stocks beaten up but chips like amd and invidia and ulta beauty. and dollar tree. starboard looking to get it to reportedly up its prices from a dollar and get rid of family dollar which it had acquired i guess it's that time, guys some acquisitions in bio tech and others leaving back to you. >> bertha, thank you very much for that >>> now, the u.s. and china restarting trade talks we have the latest on what it means for your money next. >>> plus, tesla breaking ground in china we he e avthdetails coming up on "the closing bell. . >>> u.s. officials are in beijing this week to hold two days of trade talks

there is all capital on sidelines bristol-myers squibb, acquired celgene eli lilly yesterday announce loxood for the markets. >> i think a great time for the market. couple things takes one ooh buyers oilt of market interesting, with celgene what it does it provides, for companies doing well that there is that kind of bid out there from big pharma private companies i think is go going to be more of that m&a, the way market works great time for bo tech. >> we've got big ipos coming in 2019, obviously securities and exchange mission has to open with government shultsdz you've got uber, lyft airbnb pinterest what are you expecting what is going to bring your business in are '19. >> i think others great companies, the growth of some of these newer companies in explosion of ares in terms of of tap line profitability even ones you haven't mentioned terrific ipos great for jandp yesterday drop bobs a bunch of others high he performer consumer branded companies uber lyft probably go pub this year we will have more fodder for the back great companies market share in short time i think this pause th

session overnight another deal in the pharma business, this morning we got news, eli lilly is acquiring loxore, on top of another big deal in pharma last week bristol-myers squibb acquiring celgene no deal to reopen government president trump and democratic leeds digging in on positions over funding of border security president trump ready to take superiors action he says. >> i may declare a national emergency dependent on what is going to happen over the next few days but i think we're going to have some very serious talks, come monday, tuesday, wednesday, we have to have border security, if we don't have border security we are going to be crime-ridden it is going to get worse and worse. >> latest from white house coming up this morning, on that, and change at the top of cbs the president cbs david rose out the replaced by long time producer of the network making history we are going to tell you about that coming up, and this, breaking ground, tesla ceo elon musk says construction under way at automaker new plant in china, about plus christian bail golden globe last night also a dig at the