Published: February 6, 2013
DUBLIN (Reuters) — The Irish drug maker Elan will raise more than $3.25 billion by selling its interests in its main drug to its partner, Biogen Idec, and will try to reinvent itself by using most of the cash on acquisitions.
Under a deal announced on Wednesday, Biogen Idec will take full ownership of the blockbuster multiple sclerosis treatment Tysabri and will make an upfront payment to Elan plus royalties on future sales.
While the deal gives Elan scope to return some cash to shareholders as well as strategic flexibility to buy new assets, it leaves its future shape unclear. Tysabri was by far its most important product, responsible for almost all of its revenue.
Elan has already spoken to several companies about potential deals and can move quickly over the next 12 to 18 months once the sale is completed, Kelly Martin, the chief executive of Elan, said in an interview.
“You can do a lot of things with $3 billion — you can buy companies, molecules, you can partner, you can share risk. The world is our oyster,” Mr. Martin said.
“We are not necessarily restricting ourselves to one therapeutic area or one type of clinical asset. We will not be restricted to our past, which was by and large neurological.”
Mr. Martin said there were hundreds of small- to medium-size drug companies with capital or capability needs, meaning there were an “enormous amount of transactions” Elan could do.