This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Elan Announces Plan To Spin-Off Discovery Science And Neotope Biosciences To Shareholders

Stocks in this article: ELN

“With Elan’s commitment to capitalize Neotope’s Bioscience, our highly talented scientific team who have previously discovered TYSABRI and an approach to immunotherapy for Alzheimer’s, will have the resources and time to advance programs for chronic degenerative diseases, such as synuclein for Parkinson’s disease, along the drug development stages and provide opportunities for investors to participate in this journey”, said Dr. Lars Ekman, Chairman designate of Neotope Biosciences. Dr. Ekman continued, “In the longer term, the team’s heightened focus and dedication to translating unique scientific insight into clinical programs will provide benefits to the field of life sciences across a broad array of diseases for the ultimate benefit of patients. With this transaction, their successes and insights are expected to provide enormous benefit to the world.”

Messrs. Ingram and Martin concluded, “Our board and management team have spent the previous twelve months assessing the optimal alignment of assets, risk/reward and income statement dynamics to the marketplace and our shareholders. These discussions took place well in advance of the recent release of the top line outcomes of the Bapinezumab Phase 3 trials. The transparent alignment of distinctive timelines and unique business characteristics to enable shareholder investment decisions and choice was our guiding principle and remained a constant which ultimately resulted in today’s announcement.”

Highlights of Previous Decade

The previous decade for Elan has been characterized as one of consistent focus and execution on delivering improvements in all aspects of its business fundamentals. Highlights of this journey include:

  • Expected 2012 revenues of $1.2 – 1.25 billion; growth of 150% since 2004
  • Operating Expenses have decreased by more than 50% since 2002
  • Adjusted EBITDA of positive $147 million in 2011, versus negative $203 million in 2004
  • Debt and Contractual obligations reduced by 76% since 2002
  • Corporate tax rate of 12.5% with the benefit of accumulated losses and structures in excess of $4 billion
  • Launched Tysabri (twice) – for MS with potential for additional indications
  • Reduced AD clinical risk with J&J – maintained programs while retaining 25% of P&L
  • Successful divestment of EDT, generating $1 billion of non-dilutive capital for Elan plc
  • Advanced ELN005 through Phase 2 with potential therapeutic symptomatic applications
  • Advancement of pre-clinical novel targets programs: synuclein, MCAM, tau, amyloid

Strategic Rationale

Today, Elan Corporation, plc is comprised of two distinct investment propositions with differing science-business risks and timeframes:

  • Commercial and growth oriented profitable business capable of generating meaningful after tax earnings for the benefit of stakeholders over the long term. Time horizons immediate and on-going.
  • Early discovery and translation to humans focused on pathology-biology based mis-folding protein targets in chronic degenerative diseases. Science and its predictability remain the major risk factor; time horizons of 5+ years to the clinic.

The Board of Directors as well as executive management believe separating into two distinct business will enable appropriate alignment of funding/capital structures with the mission of each respective business; where the interests of the shareholders and the management team will be synchronized with the risk, return and timelines of activities.

3 of 5

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,689.14 +227.82 1.38%
S&P 500 1,950.32 +23.21 1.20%
NASDAQ 4,448.7040 +65.8570 1.50%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs