Irish biotech group Elan ups defence against US bid

20th May 2013, Comments 0 comments

Irish biotechnology company Elan announced a series of deals on Monday to boost growth, in the face of a $6.0-billion hostile takeover approach by US group Royalty Pharma.

"Elan Corporation plc today announces a series of transactions designed to decisively transform and advance the company," it said in a statement.

The Dublin-based group said it was buying two small drugmakers, selling one of its drugs in development, buying back $200 million in shares and finally issuing $800 million of debt.

Subject to shareholder approvals, Elan has agreed to buy Austrian firm AOP Orphan, which focuses on specialist treatments for diseases that affect only small sections of the population.

It will acquire also a 48-percent stake in Dubai-based specialty pharmaceuticals startup firm Newbridge, with an option to buy the rest by 2015.

Elan will also sell a drug in development which is designed to manage aggression in patients with Alzheimer's disease, to Speranza Therapeutics.

Monday's announcements come after the firm last month rejected a takeover approach from US peer Royalty Pharma, which valued the group at about $6.0 billion (4.7 billion euros).

Elan said the deals would help rebuild the business and secure its long-term future, three months after selling its only drug in production in a $3.25-billion deal.

The company has faced uncertainty about its future after the sale in February of its half-share in blockbuster multiple sclerosis drug Tysabri to development partner Biogen Idec Inc.

It retained a royalty stream from sales of the drug but the deal prompted questions about its strategic direction.

Since selling its stake in Tysabri, Elan has returned $1.0 billion in cash to shareholders through a share buyback.

Monday's statement also came one week after Elan signed a $1.0-billion deal to share royalties from four respiratory drug programmes with US firm Theravance.

- Dow Jones Newswires contributed to this report -

© 2013 AFP

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