Elan agrees to sell drug rights to Solstice

ELAN’S €2 billion plus asset sell-off may have come to an end yesterday with the disposal of potential Botox competitor Myobloc for up to €15 million.

Elan yesterday announced that it has completed the sale of its worldwide rights to its botulinum toxin product Myobloc/Neurobloc to Solstice Neurosciences.

No sale price was disclosed but it is speculated that it was close to Myobloc’s annual sales of between €12 million to €15 million.

Solstice Neurosciences is a recently formed company focused on the development, manufacturing, sales and marketing of specialty biopharmaceutical products.

Elan sold off all the related intellectual property, the product inventory and its manufacturing facility.

It is expected the move will have a cost-cutting impact on Elan as 30 employees will be offered the opportunity to continue their work on the Myobloc product as employees of Solstice.

In a note to clients yesterday, Davy analyst Jack Gorman said Elan had stopped investing in the product during 2003 and in the fourth quarter of the years recorded a $37.1 million (€30 million) write-down on the carrying value of the asset to reflect this.

“This substantially completes the divestments that we expect from Elan with the focus now solely on its exciting pipeline prospects,” Mr Gorman added.

Goodbody’s Ian Hunter said the drug never took off because of a lack of referenced trial data (a position Elan was trying to improve) and because it was competing against the established drug, Botox.

“Elan has consistently stated that the drug was non-core and so although somewhat later than the bulk of the recovery programme disposals, this move is not unexpected,” he added.