Bloomberg News

Elan Shares Fall on Tysabri Study, Ahead of Review (Update2)

March 01, 2006

Shares of Elan Corp., Ireland's biggest drugmaker, fell for the second day after a study suggested its withdrawn multiple-sclerosis treatment, Tysabri, can deplete the immune system as much as HIV.

Shares of Elan fell 39 cents, or 3.4 percent, to 10.80 euros by the close of trade in Dublin. The amount of immune-system cells in spinal fluid of patients given Tysabri fell as low as levels seen in people infected with the virus that causes AIDS, a study by University of Texas neurologists found.

Elan and U.S. partner Biogen Idec Inc. (BIIB:US) stopped selling Tysabri a year ago after two patients taking the $23,000-a-year drug along with Biogen's older Avonex MS treatment, died from progressive multifocal leukoencephalopathy, or PML, a rare brain disease. Piper Jaffray's Deborah Knobelman said yesterday that safety concerns may restrict the use of Tysabri to patients who've failed to improve on other medicines.

Tysabri works by damping down the immune system in the brain, NCB analyst Orla Hartford said. ``Clearly the HIV virus also attacks the immune cells directly and results in reduced immune cell levels but the connection between Tysabri and HIV ends there,'' Hartford said in a note today.

Study Circulated

The study, which was circulated by an outside spokesman for Teva Pharmaceutical Industries Ltd., maker of the multiple-sclerosis drug Copaxone, was summarized on the Web site of the American Academy of Neurology yesterday.

``Other competitors will try to do everything they can to bring about criticism,'' Lars Ekman, head of research and development for Elan, said in an interview late yesterday. ``These are speculative exercises done by the competition, positioned and designed to undermine a new drug.'' Ekman said he had heard about the study but hasn't seen it.

Elan will suspend trading in its shares for two days next week when a U.S. Food and Drug Administration advisory panel meets to consider returning Tysabri to the market. The advisory panel meets March 7 and 8.

``As the action of Tysabri is, by nature, immuno-suppressive, some degree of depletion immune system cells would be expected,'' Ian Hunter, an analyst at Goodbody Stockbrokers wrote in a note today. ``We remain comfortable that the drug will return to the market as more than just a second-line treatment.''

PML occurs when a virus called JC evades the body's immune defenses and penetrates the brain, causing irreversible damage. The disease, which has no treatment and no cure, erodes mental function, vision, speech and muscle coordination. Patients typically die one to four months after being diagnosed.

To contact the reporter on this story: Etain Lavelle in London at at elavelle1@bloomberg.net.

To contact the editor responsible for this story: Chris Elser at celser@bloomberg.net.


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Companies Mentioned

  • BIIB
    (Biogen Idec Inc)
    • $332.24 USD
    • 2.48
    • 0.75%
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