Eli Lilly and Company has reached an agreement with ICOS Corporation to amend the merger agreement relating to the proposed acquisition of ICOS by Lilly.

Under the revised terms, Lilly will acquire all of the outstanding shares of ICOS common stock at a price of $34 per share, for a total purchase price of approximately $2.3 billion, an Eli Lilly press release said.

The proposed $34 price reflects a $2 per share increase from the $32 per share pursuant to the original merger agreement, and Lilly is affirming that this is its best and final offer.

"We are confident that ICOS shareholders will recognize the substantial value and the certainty that Lilly is offering," said Sidney Taurel, Lilly chairman and chief executive officer. "We believe this transaction delivers significant value to ICOS shareholders, and it is our final offer."

The boards of directors of both companies have unanimously approved the revised merger agreement.

A revised proxy statement reflecting the changes in the terms of the proposed transaction will be mailed to ICOS shareholders. In order to give ICOS shareholders a full opportunity to review the revised proxy statement, ICOS will adjourn the special meeting of ICOS shareholders to vote on the merger to January 25, 2007 from the current date of December 19, 2006 and has set a new record date of December 26, 2006 for the shareholder meeting.