Elan to update on drug tech division

DUBLIN-headquartered pharmaceutical company Elan is expected to give some update on the future of its drug technology division, when it issues its third-quarter results next week.

The sale of Elan Drug Technology (EDT), the €1bn-valued outsourced drug research arm of Elan, has been in the offing for some months and a number of international private equity houses, including Bain Capital, Warburg Pincus and TPG, have been heavily linked with bids.

However, as Elan’s management has chosen to remain tight-lipped over the future ownership prospects for EDT — the company’s stock communication on the issue is that it “continues to evaluate all parts of the overall business on an ongoing basis” — it is doubtful whether any real news regarding EDT will be forthcoming.

Certainly, analysts are not overly expectant on anything concrete.

“It may be more prudent to keep cash-generating units like EDT until there is more clarity on the take-up of Tysabri, following the most recent PML cases,” said Davy analyst Jack Gorman.

At a US investor conference, earlier this week, Elan chief executive Kelly Martin said the company remained focused on cash generation from its headline multiple sclerosis drug, Tysabri — for which the company is aiming to have 100,000 users by the end of 2010, up from its current level of nearly 32,000.