Biotech Elan may go on market after strategic review

IRISH BIOTECH group Elan may put itself on the market as a result of a strategic review announced yesterday. The company said advisers will assess a range of options to provide the funds and commercial structure to develop its drug pipeline and maximise the potential of existing products.

The news came on the same day that Biogen Idec, its partner in the Tysabri programme, revealed that sales of the multiple sclerosis (MS) drug had slowed sharply towards the end of last year.

Biogen chief executive Jim Mullen said 37,600 patients were registered on the Tysabri treatment programme at the end of the year, just 2,100 or 5.9 per cent more than at the end of the third quarter. That compares with growth of 11.6 per cent in the previous three months. Biogen also gave some details of the numbers quitting Tysabri, which he said were in the region of the 20 per cent norm for MS drugs.

In a statement yesterday, Elan said it had asked Citigroup Global Markets to work with management and other advisers to review the company’s “strategic alternatives”. “The goal is to secure access to the necessary financial resources and commercial infrastructure to allow Elan to accelerate the development and commercialisation of its extensive pipeline and product portfolio,” the company said in a statement.

“The range of alternatives that will be assessed could include minority investment or strategic alliance, a merger or sale.”

A spokeswoman for the company said later that a merger or sale would be Elan’s less favoured options.

The announcement also comes just days after Elan chief executive Kelly Martin denied market rumours that it was being targeted for takeover by drugs giant Pfizer. In an interview, he said the company “was about a third of the way through our process of completing licensing deals” for early stage cancer drugs that could raise as much as $500 million to “put a dent in our debt” and fund the last stage of its Alzheimer’s disease treatment Bapineuzimab, which it is developing with Wyeth.

Yesterday, at the JP Morgan Healthcare Conference, Biogen’s Mr Mullen said the “trend line [on Tysabri patient registration] has pretty much stabilised” after concern about the occurrence in patients of a potentially-fatal brain disease PML “and we now go to work on rebuilding momentum”.

Biogen announced recently that it would update its website with details of the status of PML cases in patients treated with Tysabri every Friday between now and the third anniversary of the drug’s return to market in July.