By Shawn PogatchnikDUBLIN -- Irish biopharmaceutical company Elan ( ELN) reported a wider net loss in the first quarter Wednesday because of restructuring costs, but said sales improved for its key multiple sclerosis drug Tysabri. Dublin-based Elan lost $103 million (79.5 million euros) in the first three months of 2009, compared with a loss of $86 million in the same period a year ago. Sales rose 30% to $245 million. The company attributed the wider losses chiefly to increased severance and restructuring costs totaling $22 million versus a $3 million charge in the first quarter of 2008, while it said the foundation of the business -- particularly Tysabri --was growing in strength. Elan raised research and development spending 11% to $81 million, chiefly for its ongoing efforts to create a treatment for Alzheimer's disease. It also suffered a $14 million U.S. tax charge, up from $2 million in the first quarter of 2008, reflecting a return to profitability for the company's American division following seven years of losses. Tysabri is already Elan's central source of income and growth. The drug is made and sold in partnership with Biogen Idec ( BIIB) of Cambridge, Mass. The drug is used to treat multiple sclerosis, an incurable disease of the central nervous system.
Elan said the number of people using Tysabri has risen 54% over the past year to 39,300, slightly more than half of them in the United States, most of the rest in the European Union. Elan's share of first-quarter Tysabri income totaled $158 million, up 48%. It said every 10,000 users of Tysabri represents $100 million in profits for Elan. It cited data published last month in the Lancet medical journal that said 37% of MS patients using Tysabri had remained free from disease progression for two years, compared with 7% of those taking a placebo. Research has shown Tysabri works better than long-established treatments but it has faced regulatory and marketing hurdles because of its link to a rare, usually fatal brain-swelling disease called PML. Elan and Biogen initially pulled Tysabri from the U.S. market in February 2005 when it reported three cases of PML in Tysabri users, two of whom died. American and EU regulators cleared Tysabri for sale in mid-2006 but under much stricter conditions, citing its PML risk. Biogen said last week that regular scans of Tysabri users had detected a sixth confirmed case of PML since the drug's reintroduction in 2006. Elan and Biogen had already informed investors of five of those cases from August 2008 to February 2009. Both companies have declined to specify whether any of the recent PML victims have died. Biogen specified that the sixth PML victim had been taking Tysabri for 31 months, longer than the previous five.