Please login to the form below

Not currently logged in
Email:
Password:

Royalty Pharma mulls bid for Elan

Follows Biogen’s $3.25bn acquisition of Tysabri from Elan

Royalty PharmaFresh from negotiating a $3.25bn windfall from partner Biogen Idec, Elan has become the target of a possible takeover bid by US company Royalty Pharma.

Privately-held Royalty Pharma specialises in buying up intellectual property assets in the pharma sector, generating revenues from royalty interests in more than 30 approved or late-stage drugs.

The company's move for Elan comes after the Irish drugmaker signed over rights to multiple sclerosis therapy Tysabri (natalizumab) to Biogen Idec in a deal that netted it $3.25bn upfront and a royalty steam.

Elan has already said it would return $1bn to shareholders and refinance debt, with analysts suggesting that a push for liquidity meant some form of merger or acquisition may be on the cards.

Royalty Pharma said in a statement issued this morning that it met with Elan's management last week to propose a $11-per-share offer for the pharma company - a 12.5 per cent premium to its closing price on February 15 - and was "surprised" that Elan's subsequent statement about the Biogen Idec deal had made no mention of its approach.

The offer would value Elan at more than $6bn but is only around 4 per cent higher than the company's closing share price last Friday of $10.58.

The company said it was effectively offering Elan shareholders a "simple and clear choice": remain an investor in a company whose material assets will consist of cash and Tysabri royalties while management looks for other opportunities, or sell for a cash amount.

"The risks and lack of earnings visibility associated with Elan's acquisition and in-licensing strategy are substantial," claims Royalty Pharma in its proposal document, which stresses this is not yet a firm intention to make an offer.

At the time of writing Elan had not yet responded publicly to the proposal statement from Royalty Pharma.

25th February 2013

From: Sales

Share

Tags

Featured jobs

Subscribe to our email news alerts

PMHub

Add my company
Clark Health Communications

Clark Health Communications (CHC) is an independent, award-winning health and medical communications agency. Our collaboration with experts and advocates enhances...

Latest intelligence

WHITE PAPER: The increasing importance of clinical trial marketing advertising in patient recruitment
Learn why advertising is more important than ever in clinical studies...
The 'winner takes all' pricing game
Tendering has long been common in healthcare for medical devices and diagnostics; the Gulf Cooperation Council and the Jamaica Commodity Trading Company have been using pharmaceutical tendering since the 1970s....
Early diagnosis underpins NHS cancer strategy
Paul Midgley, Oli Hudson and Sarah Shield, of Wilmington Healthcare, explore how the NHS is tackling cancer in line with the Long-term Plan...

Infographics