Elan earns huge cash injection for blockbuster drug
US biotech Biogen Idec is to pay $3.25 billion (£2 billion) to Irish drugmaker Elan for full rights to Tysabri (natalizumab) injections for the treatment of multiple sclerosis (MS).
The drug is currently marketed jointly by the two companies, with profits split evenly. It generated $1.6 billion in sales in 2012, up 8% compared with 2011, and accounted for almost all the sales at Elan.
Under the terms, Biogen Idec will pay $3.25 billion up front in order to take full ownership of the blockbuster drug and agree to make future payments linked to sales.
The deal ‘provides for a meaningful de-risking of the business’, said Elan chief executive Kelly Martin. ‘As we move through 2013 and beyond, the close of the Tysabri transaction gives us strategic flexibility to add to the shareholder value proposition and investment thesis by enabling continued prudent and risk justified investment in our pipeline, selectively adding commercial and clinical assets, and exploring the return of capital to shareholders at the appropriate time and in the right manner.’