Alzheimer’s drugs to show profit

ELAN could be well-positioned to start profiting from its anti-Alzheimer’s products over the next decade, with two of its drugs for treating the degenerative disease potentially delivering combined annual sales of around $5 billion (€4.18bn) by 2015.

Goodbody Stockbrokers has forecast that, on current market price levels, the two Alzheimer's drugs in which Elan is collaborating with Wyeth Pharmaceuticals with the production names AAB-001 and ACC-001 could generate sales of $2.7bn (€2.26bn) and $2.2bn (€1.84bn) respectively by 2015.

The two drugs are in Phase II and Phase I of development respectively and could, potentially, be approved for market within four years.

In total, Elan has varying degrees of interest from full production to royalty/property rights in five Alzheimer's drug products.

It still has property rights to an Alzheimer's treatment, which is currently in Phase II of development by the US-based pharmaceutical company Ely Lilly.

"Although Elan may not be the first to market, they will be entering a market which will be able to support several maybe three or four big performing $1bn-plus (€837 million-plus) sales generating products.

"There's a lot of competition and from a current pipeline of over 130 drugs, we've identified seven that currently show strong potential including the two from the Elan/Wyeth collaboration," said Goodbody analyst Ian Hunter.

Conservative estimates based on UN world population figures and World Health Organisation (WHO) predictions forecast that the number of people around the world moving into the age bracket in which one is most susceptible to the disease will grow exponentially over the next 20 years, from its current level of approximately €620 million to €1.5 billion by 2020.

As a direct result, the global market for anti-Alzheimer's drug products is expected to surge accordingly, going from its current value of $3bn (€2.5bn) to $10.3bn (€8.62bn) by 2015 and $13.2bn (€11.05bn) five years later.

"The world's population is getting older and the baby boomer generation will be hitting its mid-60s. Unfortunately, with a higher proportion of the world's population reaching an advanced age, the levels of people contracting dementia will also increase. It, therefore, stands to reason that the value of the drug market directly linked to a disease like Alzheimer's should also increase," added Mr Hunter.

Elan, which recently announced that it cut its full-year losses to $384m (€321m) for 2005 down from $395m (€330m) for the previous year was last week celebrating the partial lifting by the US Food and Drug Administration (FDA) of restrictions on Tysabri, the multiple sclerosis drug it produces with Biogen.