8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

Current Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934

September 28, 2007

Date of Report (Date of earliest event reported)

OSI PHARMACEUTICALS, INC.

(Exact name of registrant as specified in its charter)

Delaware	0-15190	13-3159796
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

41 Pinelawn Road
Melville, NY 11747

(Address of principal executive offices)

(631) 962-2000

(Registrant’s telephone number, including area code)

N/A

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 8.01. Other Events.

     On October 2, 2007, OSI Pharmaceuticals, Inc. (“OSI”) and AVEO Pharmaceuticals, Inc. (“AVEO”) announced that they had entered into a small molecule drug discovery and translational research collaboration. A copy of the press release, dated October 2, 2007, is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

     On October 2, 2007, OSI will hold a webcast to discuss its collaboration with AVEO. A transcript of the conference call is attached as Exhibit 99.2 to this Form 8-K and is incorporated herein by reference.

Item 7.01. Regulation FD Disclosure.

     OSI will announce during its webcast that its collaboration with AVEO was contemplated in the financial guidance that it provided on July 30, 2007 and therefore does not require OSI to change its 2007 earnings guidance as a result of this announcement.

Item 9.01. Financial Statements and Exhibits.

Exhibit No.	Description
99.1	Press Release dated October 2, 2007.
99.2	Transcript of the webcast conference call to be held on October 2, 2007.

SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: October 2, 2007	OSI PHARMACEUTICALS, INC.
	By:	/s/ Barbara A. Wood
		Barbara A. Wood
		Vice President, General Counsel and Secretary

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release dated October 2, 2007.
99.2	Transcript of the webcast conference call to be held on October 2, 2007.

EX-99.1

Exhibit 99.1

NEWS RELEASE

Contacts:
OSI Pharmaceuticals, Inc.	AVEO Pharmaceuticals, Inc.
Kathy Galante (investors/media)	Michael Christiano
631-962-2043	617-299-5925
Kim Wittig (media)	Sheryl Seapy (media)
631-962-2135	949-608-0841

OSI Pharmaceuticals and AVEO Pharmaceuticals Enter into an Oncology Drug Discovery
and Translational Research Collaboration

- OSI to Host Conference Call / Webcast -

MELVILLE, NEW YORK & CAMBRIDGE, MASSACHUSETTS — October 2, 2007 — OSI Pharmaceuticals, Inc. (Nasdaq: OSIP) and AVEO Pharmaceuticals, Inc. announced today that they have entered into a small molecule drug discovery and translational research collaboration. The alliance is anchored around developing molecular targeted therapies that target the underlying mechanisms of epithelial-mesenchymal transition (EMT) in cancer, a process of emerging significance in tumor development and disease progression and the focal point of OSI’s proprietary oncology research efforts. The companies will collaborate to develop proprietary target-driven tumor models for use in drug screening and biomarker validation, and intend to deploy these systems in support of OSI drug discovery and clinical programs.

Under the terms of the agreement, OSI will pay AVEO a total upfront of $10 million in cash and purchase equity valued at approximately $5 million. OSI will also pay AVEO research funding, and milestones and royalties upon successful development and commercialization of products from the collaboration.

“We are delighted to announce this collaboration with AVEO,” stated Colin Goddard, Ph.D., Chief Executive Officer of OSI Pharmaceuticals. “AVEO’s unique suite of in vivo models and associated research tools ideally supplements and complements our own rapidly emerging expertise in EMT. The collaboration fits squarely within our strategic and financial planning goals which seek to build fundamental shareholder value by

emphasizing — in addition to execution on our Tarceva program, financial performance and developing and owning our own core pipeline assets — the need to establish a strong, differentiated research platform.”

“We are very pleased to collaborate with OSI to further demonstrate the utility of our rich target database and our proprietary Human Response Prediction™ (HRP™) platform,” stated Tuan Ha-Ngoc, President and Chief Executive Officer of AVEO. “This latest collaboration underscores the substantial opportunity that our expertise in cancer genetics and unique platform provide to increase the efficiency and probability of success in oncology drug discovery and development. Select collaborations on our novel HRP™ platform allow us to maximize and enhance the value of our intellectual property while we concurrently apply HRP™ to build and advance our own pipeline of oncology drug candidates.”

As part of the collaboration, OSI will provide expertise in defining EMT in both AVEO models and in human tumor tissue. AVEO will provide access to its extensive databases of tumor targets identified from AVEO genetic screens, focusing on tumor maintenance genes that drive EMT. AVEO will further utilize its HRP™ platform to develop in vivo tumor models driven by the EMT target genes of interest, validating key EMT targets and creating critical tools for drug discovery and translational research.

OSI will conduct small molecule drug discovery programs on a defined number of EMT and tumor-maintenance targets validated by AVEO. The companies will collaborate on translational research programs concerning key OSI development programs. OSI will be responsible for the development and commercialization of all clinical candidates from the collaboration. Rights to antibodies and antibody-related biologics against those targets are retained by AVEO.

About EMT Research at OSI

Epithelial-to-Mesenchymal Transition (EMT), and its reverse Mesenchymal-to-Epithelial transition (MET), are important phenomena in developmental biology that are increasingly associated with tumor biology. EMT is thought to be a marker of tumor progression, with tumors that express mesenchymal markers having a greater tendency to be invasive and metastasize than those tumors only expressing epithelial markers. OSI’s interest in EMT derived from its translational research efforts into better understanding which patients optimally benefit from therapy with the company’s flagship product, Tarceva^® (erlotinib). Because mesenchymal tumor cells co-opt different sets of oncogenic signalling pathways, EMT targets represent a novel therapeutic opportunity in an area of significant unmet medical need. OSI has surmised that understanding and targeting the dynamic biological processes of EMT has offered it the opportunity to establish a highly differentiated, industry leading position as the organization best able to capitalize on this emerging field of oncology research. The company has focused its oncology research on discovering and validating EMT related targets; developing novel therapies — and combinations of therapies — against these EMT targets; developing specialized animal models that recapitulate EMT processes; and identifying and validating biomarkers to support these programs. The

company believes that developing a differentiated and industry leading technology platform for its oncology research efforts is an essential component in establishing the strategic value of OSI’s oncology franchise.

Synergies in the OSI/AVEO Collaboration

AVEO utilizes proprietary, inducible in-vivo cancer models to identify and validate novel drug targets, support lead development and validate biomarkers to help guide drug development. The animal models are developed in a manner that offers more biological context than more traditional xenograft models and — since EMT is a context specific biological phenomenon — are likely to provide powerful tools to support the OSI/AVEO collaborative programs.

OSI’s Oncology research is focused on understanding the science of EMT in solid tumors in order to develop effective and safe mechanism-based therapeutic agents. To learn more about EMT please visit: http://www.osip.com/pdf/OSIEMTPresentation.pdf

About AVEO’s Human Response Prediction™ (HRP) Platform

AVEO’s HRP platform is based on AVEO’s proprietary, genetically-defined mouse models of human cancer. Each of these models is engineered to contain signature genetic mutations that are present in human disease. Beyond these cancer-initiating engineered mutations, the resultant tumors acquire common and distinct spontaneous mutations during tumor progression, providing additional natural genetic variation more akin to the range of genetic heterogeneity encountered across different primary human tumors. The tumor-to-tumor genetic variation in the system provides the opportunity to identify genetic correlations between responding and non-responding tumor populations, and to apply such genetic profiles in clinical development. Consequently, compared with traditional xenograft models that have proven to be non-predictive of efficacy, often leading to expensive and time consuming hit or miss outcomes in clinical trials, AVEO’s cancer models are improved predictors of human response.

OSI to Host Conference Call / Webcast

OSI will host a conference call today, October 2, 2007 at 10:00AM (Eastern Time). To access the live webcast or the fourteen-day archive via the Internet, log on to www.osip.com. Please connect to OSI’s website at least 15 minutes prior to the conference call to ensure adequate time for any software download that may be needed to access the webcast. Alternatively, please call 1-888-819-8045 (U.S.) or 1-913-312-0858 (international) to listen to the call. The conference ID number for the live call is 3434472. Telephone replay is available approximately two hours after the call through October 16, 2007. To access the replay, please call 1-888-203-1112 (U.S.) or 1-719-457-0820 (international). The conference ID number is 3434472.

About OSI Pharmaceuticals

OSI Pharmaceuticals is committed to “shaping medicine and changing lives” by discovering, developing and commercializing high-quality and novel pharmaceutical products designed to extend life and/or improve the quality of life for patients with cancer

and diabetes/obesity. The company’s oncology programs are focused on developing molecular targeted therapies designed to change the paradigm of cancer care. OSI’s diabetes/obesity efforts are committed to the generation of novel, targeted therapies for the treatment of type 2 diabetes and obesity. OSI’s flagship product, Tarceva^® (erlotinib), is the first drug discovered and developed by OSI to obtain FDA approval and the only EGFR inhibitor to have demonstrated the ability to improve survival in both non-small cell lung cancer and pancreatic cancer patients in certain settings. OSI markets Tarceva through partnerships with Genentech, Inc. in the United States and with Roche throughout the rest of the world. For additional information about OSI, please visit http://www.osip.com.

About AVEO

AVEO is a private biopharmaceutical company focused on the discovery and development of novel, targeted cancer therapeutics. The company utilizes its proprietary, genetically-defined cancer models for the identification and validation of novel cancer targets, and has begun to build an impressive portfolio of drug discovery and development programs around these high-value targets. AVEO also uses its Human Response Prediction™ Platform to identify genetic profiles that correspond with patient responsiveness. AVEO expects to commence Phase 2 clinical studies in the second half of 2007 for AV-951, its oral, second-generation VEGF receptor inhibitor and most advanced clinical program. AV-412, AVEO’s EGFR/HER2 inhibitor, is currently in Phase 1 clinical trials. AV-299, a novel anti-HGF mAb partnered with Schering-Plough Corporation, is expected to enter the clinic in early 2008. AVEO is located in Cambridge, Massachusetts. For more information, please visit the company’s website at www.aveopharma.com

This news release contains forward-looking statements. These statements are subject to known and unknown risks and uncertainties that may cause actual future experience and results to differ materially from the statements made. Factors that might cause such a difference include, among others, the completion of clinical trials, the FDA review process and other governmental regulation, OSI’s and its collaborators’ abilities to successfully develop and commercialize drug candidates, competition from other pharmaceutical companies, the ability to effectively market products, and other factors described in OSI Pharmaceuticals’ filings with the Securities and Exchange Commission.

EX-99.2

Exhibit 99.2

On October 2, 2007, OSI Pharmaceuticals, Inc. (the “Company”) will hold a webcast conference call regarding the announcement of a research collaboration between the Company and AVEO Pharmaceuticals, Inc. The following represents a textual representation of the transcript of the webcast conference call consisting of remarks by Colin Goddard, Ph.D., Chief Executive Officer of the Company.

Dr. Colin Goddard:

Good morning everyone and welcome to our conference call to discuss this morning’s announcement of a research collaboration with AVEO and — more broadly — the strategic framework in which it is based.

Joining me on the call today I have Dr. Neil Gibson, our Chief Scientific Officer, Dr. David Epstein, Vice President of Oncology Research and Kathy Galante, head of IR and PR.

Over the last two years we have executed a re-engineering of the business as a means of re-establishing the value/growth proposition that is OSIP. We have stripped out costs & driven financial performance to the extent that we were able to raise our 2007 earnings guidance on our second quarter call to $1.40.

We have also out-sourced and off-shored certain activities for enhanced cost control & flexibility, have focused our R&D spend and are in the process of completing the divestiture of our Eye Business.

Finally, despite flat U.S. sales, we have continued to see strength in our flagship asset, Tarceva. Global Tarceva Sales Growth is tracking at over 40% when comparing 1H 2007 with 1H 2006. Perhaps more importantly the competitive situation has clarified considerably in the brand’s favor, with only one of eight potentially competitive phase III trials that we have been tracking over the last two years being positive. This, along with anticipated read-outs of the SATURN and BETA phase III trials over the next 9 to 18 months paves the way for the company’s future success.

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However, given the nature of our Tarceva partnerships with Genentech and Roche — where we do not have sufficient control over our flagship asset — we have recognized that we need to do more than simply maximize Tarceva cash-flows and deliver financial performance if we are really going to build the strategic value of our business for our shareholders.

We have also recognized that acquiring clinical assets is an expensive — arguably over-priced - and highly competitive exercise and one that is rife with risk. We have therefore chosen to focus on drawing out the value in our own oncology and diabetes research pipelines where we intend to maintain control of selected core assets in order to deliver a maximal “step-up” in value as we move them through development and into the marketplace.

As we have discussed on prior calls we have chosen to focus our business development efforts on pursuing supplementary and complementary research assets and technology that we can acquire or — in the case of today’s AVEO announcement — build collaborations around such that we are able to differentiate our research platforms and, thereby, to collectively increase the technology value of our business.

Today we announced that we will pay AVEO $10 million in cash — which includes $2.5 million in advanced year one research funding — and purchase AVEO stock with an approximate value of $5 million in order to enter into a three —year research collaboration with AVEO in support of our efforts to build a unique, differentiated and industry leading oncology research effort in the area of epithelial-to-mesenchymal transition biology. We will also fund AVEO at $2.5MM per year for years two and three of the alliance and pay undisclosed milestones and royalties. Today’s transaction was contemplated in our prior financial guidance and we are not changing our 2007 earnings guidance as a result of this announcement.

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Over the years we have built a high quality small molecule oncology research organization primarily focused on the discovery of small molecule tyrosine kinase inhibitors. While of high quality we recognized that this platform was largely undifferentiated from similar and often larger programs in the pharma industry and therefore underappreciated as an asset for the company. This year we have embarked upon a plan that builds on the core strengths and expertise of the internal oncology research group and orients them toward a goal of building a comprehensive platform of intellectual property, proprietary know-how and integrated discovery and translational research capabilities in order to exploit our emerging understanding of the biology of epithelial-to-mesenchymal transition or EMT.

Our interest in EMT first derived from our translational research efforts into better understanding which patients gained optimal benefit from Tarceva therapy. Analyses of data from the failed first-line NSCLC TRIBUTE study showed that the sub-population of patients whose tumors appeared to be more epithelial like — as measured by positivity for the Epithelial marker E-Cadherin — appeared to derive appreciable benefit from adding Tarceva to chemotherapy. We surmised that understanding and targeting the dynamic processes of EMT and its reverse, Mesenchymal-to-Epithelial Transition (or MET), offered us the opportunity to establish a highly differentiated, industry leading position as the organization best able to capitalize on this emerging field to better understand the crucial nature of these processes in cancer biology. It is also clear that EMT is an area of growing interest in the cancer research community at large with multiple presentations featured at this year’s AACR meeting. In essence we believe pursuing EMT builds on our understanding of personalized medicine, not only “right drug, right dose, right target” but also the “right combination” of drugs to address the biological context of a patient’s tumor. We have embarked upon a plan that seeks to:

(i)	Identify and validate proprietary targets underpinning these key mechanisms in tumor biology;
(ii)	Discover and develop novel therapies — and combinations of therapies — that exploit these targets;
(iii)	Develop specialized animal models that examine tumors in context; and,

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(iv) Co-incidentally identify and validate biomarkers that can be used to drive drug discovery and development and support our products in the marketplace.

A cornerstone of our thinking was the recognition that in order to rapidly and competitively assemble the necessary tools to attain a leadership position we would need to go outside the organization and acquire — through acquisition and collaboration — emerging technologies to supplement and complement our internal efforts. We identified the lack of proprietary targets, sophisticated animal models, and technologies to support biomarker development as sub-optimal within OSI.

It was these needs that drove the collaboration with the privately held, Cambridge based, AVEO.

AVEO utilizes proprietary, inducible, in vivo cancer models to identify and validate novel drug targets, support lead development and, subsequently, validate biomarkers to help guide drug development. By applying genetic screens to these in-vivo models they have identified targets — and potential targets — which appear highly relevant to EMT. The animal models are induced and developed in a manner that offers far more biological context than more traditional xenograft models and — since EMT is a context specific biological phenomenon — are likely to provide a powerful tool for our discovery and development programs. The partnership would, in essence, position OSI as AVEO’s small molecule discovery partner. Their emerging technology has been successfully piloted through a three-year collaboration with Merck.

We believe that its application in the EMT arena is likely to materially enhance our ability to validate potential AVEO targets and OSI targets (arising from our prior collaboration on SiRNA target identification with Cold Spring Harbor Labs), as well as support lead optimization and biomarker development.

We also have the ability to access in-vivo models and run a biomarker program in support of our two current development programs (IGF-1R and TORC1/TORC2) and to support

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the optimization of combination regimens involving Tarceva and molecules emerging from the alliance.

We have been very impressed with the AVEO team and fully believe that this alliance will allow us to material advance our interests in EMT.

I’ll now be happy to take any questions you may have on the transaction or on our R&D strategy.

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