Elan has told a major US medical conference that its drugs have "terrific promise" in treating Alzheimer's disease, which affects more than 13 million people around the world.

Elan's chief scientific officer, Dr Dale Schenk, said last night that the firm was closer than it had ever been to making progress on treating Alzheimer's disease.

Analysts believe even modest progress on Alzheimer's could lift Elan on to a new valuation plane. Mr Peter Frawley of Merrion Stockbrokers has said that the firm's shares could be lifted above $50 if its research in the area led to real benefits for Alzheimer's sufferers.

He said last night that the conference presentation would probably offer the market some "comfort" in the area. He added, however, that this would probably not be sufficient to prompt a rethink in his forecasts for the firm.

Elan, which is chaired by Dr Garo Armen and is researching Alzheimer's with its joint-venture partner Wyeth, was forced to abandon trials of an experimental Alzheimer's vaccine two years ago when a number of patients developed brain inflammation as a result of taking the AN1792 drug.

Since then, Elan has avoided detailed comment on the conclusions it drew from the trials when they were terminated.

This week, however, the company has presented evidence showing that AN1792 had logged some success in clearing the plaques that develop in the brains of Alzheimer's sufferers.

It was also linked to other benefits, such as improvements in the memories and attention spans of some patients.

Mr Schenk said Elan's next priority would be to move its two follow-on AN1792 programmes into clinics.

Shares in Elan closed at $23.06 in New York, where they are mostly traded.