Source EP Vantage
Company Elan, Biogen Idec, Johnson & Johnson
Date July 21, 2009
Elan admitted today that there is slightly more to its deal with Johnson & Johnson than previously announced. Essentially, the two companies have made sure that should the opportunity arise to buy Biogen Idec’s 50% share of multiple sclerosis drug Tysabri, and the purchase seems like a good idea at the time, the cash will be available to do so, courtesy of J&J.
Although this new development has significant potential, at the moment for Elan and J&J it changes very little. A change of control has to occur at Biogen Idec, triggering an option to buy Tysabri outright, before any such deal could kick in. For the US biotech, however, the sands have shifted. Previously, any bidder for Biogen could have been fairly confident that cash-strapped Elan would have chosen to retain the status quo over Tysabri or, for the right price, possibly even sell it. Because of this new arrangement, the Irish drug maker has more control over its future.
