UPDATE: Elan, J&J In Deal To Finance Potential Tysabri Buy
July 21 2009 - 1:20PM
Dow Jones News
Irish drug company Elan Corp. (ELN) has an arrangement whereby
its U.S. strategic partner, Johnson & Johnson (JNJ), will help
Elan finance the purchase of another 50% stake in
multiple-sclerosis drug Tysabri - but only if that opportunity
arises, Chief Financial Officer Shane Cooke said Tuesday.
Elan and U.S. company Biogen Idec Inc. (BIIB) are joint-venture
partners on Tysabri, whose annual revenue is fast reaching the $1
billion mark, according to Elan. If there is a change of ownership
in Biogen Idec, then Elan has the option to buy the other 50% of
Tysabri, or to sell its 50% stake in the MS drug.
A Biogen spokeswoman declined to comment on any agreement
between Elan and Johnson & Johnson, but noted that the
change-of-control provision with Elan allows "several different
methodologies" of valuing the Tysabri stake, including a
third-party valuation.
In a separate $1.5 billion deal recently announced between Elan
and Johnson & Johnson, J&J will acquire the assets of and
rights to Elan's Alzheimer's program co-partnered with U.S. firm
Wyeth (WYE) and invest $1 billion in Elan in exchange for new
American Depositary Receipts of the Irish company, representing
18.4% of its outstanding ordinary shares. Elan will retain a 49.9%
interest in the new Johnson & Johnson subsidiary holding those
assets.
Johnson & Johnson will assume and continue Elan's 50-50
joint-venture Alzheimer's program with Wyeth, and will initially
commit up to $500 million toward the development and launch of
Alzheimer's treatment bapineuzumab, or AAB-001.
Company Web site: www.elan.com
-By Quentin Fottrell, Dow Jones Newswires; +353-1-6762189;
quentin.fottrell@dowjones.com
(Thomas Gryta contributed to this report.)