Elan surges as Tysabri set for US return
More than €1 billion was added to Elan’s market value as the shares added €2.10 to close up at €13.40.
A US Food and Drug Administration advisory committee unanimously recommended on Wednesday that Tysabri, jointly developed by Elan and pharmaceutical company Biogen Idec, be allowed to go back on sale.
Tysabri was withdrawn by the two companies in February 2005 after it was discovered two patients who had taken the drug, along with another treatment, developed an often-fatal brain disease PML.
The FDA panel said MS sufferers should be allowed to take Tysabri so long they were aware of the risks, and that it was not used with any other MS treatment.
In a joint statement, the two companies said: “The committee’s recommendation is advisory to the FDA, and the agency is not bound by this recommendation. The FDA has designated Tysabri for priority review, a status for products that are considered to be significant therapeutic advancements over existing therapies that address an unmet medical need.
“Biogen Idec and Elan will continue to work closely with the FDA in the weeks ahead with the goal of making Tysabri available.
“The companies anticipate action by the FDA by March 29, 2006.”
Brokers said although the FDA is not bound to follow the advisory committee decision, they tend to do so.
“The unanimous advisory panel recommendation to relaunch Tysabri is excellent news for Elan,” Davy Stockbrokers analyst Jack Gorman said.
“We are confident that our peak revenue forecast of $1.6 billion (€1.3 billion), based on approximately 80,000 patients, can be met, or perhaps exceeded,” he said, adding that every $200 million (€167 million) in revenues added about $1 to his valuation on Elan stock.
The two-day FDA committee heard from a variety of scientists and patients about the effects of Tysabri.
Shares in Athlone-based Elan sunk as low as €2.30 in the months after Tysabri was withdrawn from sales.
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