Elan to decide on EDT future

ELAN is expected to arrive at a decision regarding the future status of its drug delivery division, EDT, before the end of the summer – with a separate stock market listing the likely outcome.

The Irish pharmaceutical company, which yesterday reported a return to profit for the first quarter of the year, announced, earlier this week that it is re-examining the prospect of separating the Athlone-based EDT (Elan Drug Technologies) from the main company, as a means of generating more investment for the division.

Speaking yesterday, Elan chief executive Kelly Martin said that an IPO – Elan itself is listed on the Dublin and New York markets, having de-listed from London last year – would be the preferred outcome, but a trade sale or takeover by a private equity firm would not be ruled out if an offer was deemed to represent real value for shareholders.

Mr Martin added that growth opportunities existed in both the main Elan business and EDT and said that management would like to add new technology to EDT, up its earnings and strengthen its pipeline, all of which would call for enhanced investment.

He added that management would be talking to investors over the next few months to gain insight into what appetite exists for the drug delivery business.

Elan’s first quarter figures, meanwhile, showed a net pre-tax profit of $10 million (€7.5m) for the three months to the end of March, a a turnaround from a pre-tax loss of $88.6m in the same quarter last year. On a year-on-year basis an operating loss of $54.8m was turned into an operating profit of $32.7m. First quarter revenue grew by 27%, year-on-year, to $311m; driven mainly by a 25% revenue increase for its multiple sclerosis treatment, Tysabri.