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Elan Suffers $43.6M Net Loss in Q3

From Associated Press (October 27, 2010)

DUBLIN -- Irish drugmaker Elan Corp. reported a third-quarter net loss of $43.6 million ((EURO)31.6 million) Wednesday as it paid down debts, cut research and development costs, and focused on increasing sales of drugs that combat multiple sclerosis.

Elan has struggled to record net profits since 2002, when the company experienced research setbacks and an accounting scandal.

In the third quarter of 2009, Elan recorded a net profit of $52.3 million, but only because of exceptional $107.7 million proceeds from selling majority ownership of its Alzheimer's research operations to Johnson & Johnson -- a deal that leaves multiple sclerosis as the key disease on Elan's radar.

Elan’s share of revenue from its major MS fighter, Tysabri, rose 13 percent to $215.9 million in the quarter, offsetting losses elsewhere as older drugs faced with generic competition were withdrawn from markets.

Elan also reported strong initial U.S. sales for a new anti-MS drug, Ampyra, that helps people battling the neurological disease to walk more easily. It sold $34.9 million of Ampyra this year including $14.1 million in the third quarter in the United States, the only market yet to approve the drug.

Elan -- which sells and distributes Tysabri in partnership with Biogen Idec Inc. of the United States -- said the number of MS patients taking Tysabri has risen 20 percent over the past year to 55,100, half of whom are in the United States.

The market for Tysabri continues to grow in line with its reputation as particularly effective in suppressing MS symptoms, which include sudden partial paralysis -- but at the potential risk that the user could develop a rare brain inflammation disease called PML.

The PML connection forced Elan and Biogen to withdraw the drug from sale in 2005 pending the introduction of more restrictive prescription rules the following year. The companies say less than 10 percent of users take breaks from their monthly Tysabri infusions to reduce the risk of contracting PML.

Elan's R&D costs fell 20 percent versus the same quarter of 2009, chiefly because of its sale last year of its Alzheimer's drug-development research lines to Johnson & Johnson. Elan retains a 49.9 percent stake in those operations.

Chief financial officer Shane Cooke said Elan refinanced or repaid more than $1.3 billion in debts over the past year. The exercise has reduced debts 17 percent this year to $1.29 billion, with $460 million due for repayment in November 2013, the rest in October 2016.



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Posted: October 2010