Posted April 16, 2013 by Eric Shirey in Health

Royalty Pharma to pay royal amount of $12 per ADR for Elan Corporation, plc (NYSE:ELN)- BIIB


An investor in pharmaceutical royalty-streams, Royalty Pharma, has upped its buy-out offer for Elan Corporation, plc (NYSE:ELN) (Current: $11.78, Down by 1.92%) which now stands at $7.3 billion. This move has threatened the acquisitions-plan that the latter was planning on. The former informal bid had been $11 per American depository receipt and the formal bid that follows, stands at $12 per ADR. This compares with the closing price of $12.01, on April 12. In a statement, New York-based royalty said that the offer was a fully-financed and firm one.

Better offer
Elan had received $3.25 billion from Biogen Idec Inc (NASDAQ:BIIB) (Current: $198.75, down by 3.99%) for giving up its stake in Tysabri, the multiple sclerosis drug. Kelly Martin the Elan Chief Executive Officer had been strategic to reinvest part of that amount. Royalty said that its offer will now permit Élan’s shareholders to avoid the risks associated with Martin’s plan. The Dublin-based Elan is also buying back $1 billion worth of stock and last week this move had received shareholder approval. Pablo Legorreta, Royalty’s Chief Executive Officer said that this will now provide shareholders with a lucrative alternative which can be considered against the acquisition plan that the management has.

The Irish company has been keenly interested in buying-out closely–held and listed companies who have treatments for metabolic and neurological disorders. Elan also said that it will be paying its shareholders dividends that are directly linked to the sale of Tysabri which amounts to 20 percent of the royalty-share that had been received from Biogen.

Eric Shirey

Eric Shireya is a former newspaper section editor and reporter who has been reporting on Fashion and Lifestyle for about 10 years. His work has been published in national business trade magazines, and can be found on wire services, in daily newspapers, in university alumni magazines, on the web, in newsletters, and more. His career highlights have included interviewing Bob Hope, laughing through a phone conversation with Richard Simmons, chatting with Melissa Etheridge, and enduring a press conference in a hot air balloon.