Bristol-Myers Squibb recently announced its acquisition of Medarex for $2.1 billion (at $16 per share, about a 90% premium over its previous close). As I mentioned over three years ago, analysts had been speculating about Medarex’s acquisition after Amgen acquired Abgenix in 2005. Why did Bristol-Myers finally pull the trigger after all this time? I suspect that after Bristol-Myers was outbid by Lilly for control of ImClone, BMS wanted to reinforce its biologics franchise. That and the fact that Medarex shares have taken a beating since August of last year. Bristol-Myers and others have been signaling that they would take advantage of low valuations to make acquisitions. I believe that this buying spree will continue for the near-term as the fundamentals haven’t changed yet: relatively low valuations and cash-rich buyers facing generic competition and limited R&D productivity.