Gilead, the Foster City, CA, powerhouse will pay cash for the deal.

In A conference call, Gilead CEO John Martin, COO John Mulligan, and R&D wizard Norbert Bischogberger had to deal with a fair amount of skepticism from industry analysts, who poked and prodded with questions about the deal, aiming to find its vulnerable spots. And there are several.

From CV Therapeutics, Gilead gets two marketed products: Ranexa, a $100 million seller in chronic angina; and Lexiscan, a $50 million drug for mycocardial perfusion imaging—plus a pipeline including two Phase III molecules for atrial-fibrillation molecule and heart failure.

Analysts asked whether Gilead was placing too big a bet on two hopes: that Ranexa, with a new label for first line treatment, will grab a major piece of the angio market; and that the platform will indeed deliver. The biotech is also banking on its own Phase III compound, darusentan, for persistent hypertension. In addition, CV Therapeutics sales force nicely expands Gilead’s access to cardio specialists. If everything works out as planned, the innovative specialty drugmaker could find itself leading in the blockbuster-making primary-care market. That would be a truly remarkable accomplishment.

Under tough questioning, the Gilead team stuck to their guns, proclaiming complete confidence in both their planned relaunch of Ranexa and the approval of darusentan in the competitive hypertension field, where other brave new molecules have failed.

Is it all a bridge too far, analysts wondered. Based on Gilead’s track record, maybe not. Martin reminded them that “we didn’t have to do this acquisition” (unlike some pharmas, hint, hint). But rather than sit on their cash pile, Gilead chose to roll the dice in a new game. That’s biotech talking.

Update 3/16/09: Astellas announced Monday morning that it would not engage in a bidding war with Gilead and terminated its $16 per share offer.

“Astellas also intends to withdraw a related lawsuit in the Delaware Chancery Court against CV Therapeutics and its directors,” the company stated in a release. “Astellas is a disciplined acquirer and does not see value for Astellas stockholders in CV Therapeutics at the price level ofthe sale announced on March 12.”

The CVT board rejected Astellas’s second proposal last Friday stating that the Astellas proposal undervalued the company and is not in the best interest of the shareholders.

In a press release issued this morning Astellas stated, “While we continue to prefer to reach a negotiated agreement with CV Therapeutics’ Board, their refusal to engage with us regarding our proposal has left us with no alternative but to take our offer directly to CV Therapeutics’ stockholders. We believe our offer provides CV Therapeutics’ stockholders with immediate cash value that exceeds what the company could reasonably expect to deliver on it own, particularly given current uncertain market conditions and execution risks inherent in CV Therapeutics’ standalone strategy.”

The tender offer is a 41 percent premium to CVT’s closing share price of January 26, 2009, and a 69 percent premium to CVT’s 60-day average closing price ending on January 26th.

The bidding war began in November when Astellas made the first move to buy CVT. When the offer wasn’t accepted, Astellas made a second proposal to the board in late January, which was once again rejected by CVT on February 20th.

Meanwhile, Astellas US Holding, Inc., a subsidiary of Astellas Pharma Inc., today announced that it has filed a lawsuit in the Delaware Chancery Court against CV Therapeutics Inc. According to the press release its directors are seeking, “declaratory and injunctive relief to prevent CV Therapeutics from applying its recently amended stockholders rights plan in a way that would prevent CV Therapeutics’ stockholders from tendering their shares into the tender offer announced by Astellas today and preclude CV Therapeutics from claiming that a 2000 agreement between Astellas and CV Therapeutics has been violated by the Astellas tender offer.”