Chase Manhattan's $34 billion acquisition of J.P. Morgan will combine the bio banking and research stables of the former Hambrecht & Quist (now Chase H&Q) with J.P. Morgan. While the eventual strength of the combined health care franchise will play out over the coming months, the two banks have posted some impressive IPO underwriting activity this year. Combined, the banks have been involved in 21 IPOs that have raised more than $2 billion - 36 percent of the $6.15 billion raised in global IPOs this year, and a 73 percent of the $4.47 billion raised in U.S. IPOs. "The combination would create the biggest provider of equity, debt and financial advisory services to the biotech industry," said Chase H&Q banker Vivek Jain.

Chase H&Q has been carrying the bulk of the load, as it has been involved in 18 deals compared with J.P. Morgan's five. Two deals - Large Scale Biology (LSBC) and Paradigm (PDGM) - had each bank on the syndicate.

While Chase H&Q is outselling J.P. Morgan more than 3-to-1 on the deal side, J.P. Morgan typically has been the lead banker when it gets involved: serving as the lead manager on four deals. Chase H&Q, meanwhile, has served as lead or co-lead on five deals (four leads, one co-lead) (see "Deal Flow").

Those deals have raised $544.5 million in total, giving J.P. Morgan an average deal take of $108.9 million. Chase H&Q's 18 deals have raised a total of $1.6 billion, or $91 million on average.

While who will lead the health care efforts has yet to be determined, Chase H&Q appears to have a leg up because it's purchasing J.P. Morgan and because of its size. Both banks have had some turnover in recent months. Dennis Purcell left Chase H&Q in February to join Perseus-Soros BioPharmaceutical Fund, and five months later Steve Elms left Chase H&Q to join Purcell. In June, David Low left J.P. Morgan to join (ironically) Chase H&Q as managing director of health care banking. Deepa Pakianathan and junior banker Ted Kalen head up J.P. Morgan's biotech banking.

Buyout watch

Amgen (AMGN) dipped $4.50 to $67.438 on 21.6 million shares on Thursday after management told the Bear, Stearns health care conference that the company would be receptive to making an acquisition that would be modestly dilutive to near-term earnings. Scuttlebutt is that AMGN is looking at companies with late-stage cancer antibodies. Bloomberg on Thursday mentioned ImClone (IMCL) as a candidate. IMCL has several Phase II and Phase III trials ongoing with IMC-C225 monoclonal antibody against the epidermal growth factor receptor in a range of cancers. Both IMCL and AMGN declined to comment. AMGN got back $0.188 to $67.625 on Friday, putting it down $7.313 (10 percent) on the week. IMCL jumped $14.125 (15 percent) on the week to $108.875.