Eli Lilly has emerged as the mystery “large pharmaceutical company” that Carl Icahn, the chairman of ImClone, has said was prepared to acquire his biotechnology group for about $6.1 billion (£3.5 billion), or $70 a share.

It is understood that the companies were in advanced discussions before last night’s midnight deadline for a deal to be struck, although it was unclear whether an agreement would be reached.

A formal offer by Lilly could prompt Bristol-Meyers Squibb to increase its offer for the company again. Last week Bristol, which already owns about 17 per cent of the biotech company, raised its unsolicited offer for the shares that it does not already own by $2 to $62 a share.

Bristol jointly markets Erbitux, a cancer drug, with ImClone in the US. Bristol said last week that it was prepared to launch a hostile takeover of ImClone. Mr Icahn said that Bristol’s offer was “absurd” as it was lower than the mystery suitor’s preliminary offer.

Erbitux, which is approved for colon and head and neck cancers and had $1.3 billion in sales in 2007, would be a significant addition to Lilly’s oncology business, which at present produces two cancer treatments. Eli Lilly and ImClone declined to comment on the talks, which were reported by The Wall Street Journal.

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