Elan sells pain drug rights

Elan sells pain drug rights

Byline: Dennis Fitzgerald

The troubled Irish pharmaceutical company Elan Corp. on Thursday, Oct. 3, announced its second divestiture deal in two days, saying it had sold the rights to a cancer-related pain drug in 12 countries to Anesta, a subsidiary of Cephalon Inc., for $50 million.

Elan bought the European rights to the drug, Actiq, from Anesta in December 1999. Cephalon, based in West Chester, Pa., gained the U.S. rights to the drug when it bought Anesta in October 2000.

Under the deal, Cephalon is gaining the rights to Actiq in 12 countries in Europe and Asia. Elan currently markets the drug in the United Kingdom, Ireland and Germany.

Elan said it had no financial or legal advisers for the deal. Cephalon had no financial adviser and declined to name its legal adviser. On Wednesday, Elan said it had agreed to sell the U.S., Canadian and Japanese rights to Abelcet, an antifungal agent, to Enzon Inc. of Bridgewater, N.J., for about $370 million in cash.

Elan, whose accounting practices have attracted the scrutiny of the U.S. Securities and Exchange Commission, revealed late Monday that it would take a $542 million charge in the third quarter. On Tuesday, its shares in Dublin plunged 38%.

Also Monday, Elan and privately held Acusphere Inc. of Waterton, Mass., said they had terminated a two-year-old venture to develop products for delivering medicine to the lungs. Acusphere is gaining control of intellectual property in exchange for possible royalty payments.

In August, Elan said it was planning to raise $1.5 billion by the end of 2003 through divestments, up from the $1 billion pledged in July.

More deals involving Elan may be on the way. On Wednesday, a source told Reuters that the company may put four other pain treatment drugs — Naprelan, Skelaxin, Sonata and Zanaflex — on the block.

Elan’s market capitalization has tumbled from about $22 billion to under $500 million in the past year.

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