Edward Power
Shares in Elan shot higher yesterday as the group announced that chronic pain drug Prialt was on course to reach the market early next year after passing a key clinical trial.
The stock closed over 13 per cent higher in New York last night on $8.02 after closing 8 per cent stronger in Dublin earlier at €5.84.
Elan said it expected to file an amendment to its New Drug Application to the US Food and Drug Administration for Prialt in the second quarter of 2004, and release the treatment no later than the first quarter of 2005.
Analysts said the announcement was welcome but not a surprise. They said it had been flagged by the group late last year.
"In the overall scheme of things Antegren is the key for the group," said Mr Peter Frawley, analyst at Merrion Stockbrokers, referring to a development pipeline product for multiple sclerosis. "This is much smaller but it's still positive news and we are expecting peak revenues at $150 million."
With 80 per cent margins, approval for Prialt is "very positive" news for Elan, said Mr Jack Gorman of Davy stockbrokers. "As such therapy is given in just 50 specialist pain centres across the US, the required sales force is modest," he added.
Elan, a former stock market high-flier, has been on a slow recovery track after losing 90 per cent of its value in 2002 when US regulators began an inquiry into its accounting practices.
It carried out a series of disposals last year worth about $2 billion to concentrate on future pipeline developments. - (Additional reporting Reuters)
