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With the announcement after yesterday's market close that Abbott Laboratories (NYSE:ABT) is buying Facet Biotech Corp. (NASDAQ:FACT) for approximately $450 million in cash or $27/share - a nice 67% premium to yesterday's closing market price - the focus will be on other potential targets for acquisition. Abbott said the Facet Biotech acquisition expands the company's access in immunology and oncology. The compounds include daclizumab that is expected to move into Phase III development in the second quarter 2010 to treat multiple sclerosis (MS).

But there are more companies with promising drugs under development which could attract generous valuations by other Big Pharma's. Cell Therapeutics (NASDAQ:CTIC) recently announced that the Food and Drug Administration (FDA) approved a third-party manufacturing site for the production of the company's experimental cancer drug. CTIC's drug, Pixantrone, is being reviewed by the FDA as a potential therapeutic for aggressive non-Hodgkin's lymphoma that has not responded to other approved therapies or if the lymphoma returned after initially appearing to be responding to other therapies. The FDA had expressed concerns on the efficacy and safety of Pixatrone in early February, prompting a sharp selloff in CTIC stock which is just recently rebounding from.

As with any biotech investment, the jury is still out on Pixatrone with the FDA indicating that there could be a link to heart failure. And the regulatory agency also was concerned that CTIC's study involved less patients than what the FDA expected and what the company planned.

Nevertheless, an advisory panel to the FDA will review the Pixantrone on March 22 and will submit its recommendation (a non-binding recommendation) to the FDA. The final say is reserved for the FDA, which is expected to give its final Yay or Nay on April 23.

So, it will not take long for CTIC investors to know if they were wise or mistaken. But anyone who remembers Dendreon (NASDAQ:DNDN) trading at $3/share will not ignore the potential with CTIC.

Disclosure: Author holds a long position in CTIC

Source: Cell Therapeutics: The Jury's Still Out on Pixatrone