Irish drugmaker Elan is seeing a turnaround in its performance after the effect of pulling its multiple sclerosis drug Tysabri (natalizumab) from the market earlier this year on safety concerns [[01/03/05a]] seems to be diluting.
Tysabri, which was originally touted as a blockbuster and has been developed with US partner Biogen Idec, was suspended from the market in March after one fatality linked it to a rare brain disease. But a recent safety analysis has uncovered no new cases of the disorder that proved its downfall [[09/08/05a]], indicating that Tysabri could make a re-appearance on the US market as soon as next year.
The group posted net loss for the third quarter of $67.1 million dollars, marking a 38% drop from year-earlier period, in contrast to the second quarter of this year, which saw losses mount 21% to $143 million [[280705c]]. Its performance was propelled by strong growth in product revenues from its core business and a net gain on divestment of businesses, which buffered a rise in operating expenses related to Tysabri.
Research and development costs were $60.3 million compared to $55.5 million, including $19.4 million in expenses related to the Tysabri safety evaluation and spending associated with the ongoing enrollment of patients in Phase II clinical trials with a humanised monoclonal antibody, AAB-001, for Alzheimer's disease. Selling, general and administrative expenses inched up 4% to $81.0 million.
But a robust 27% leap in total revenues to $128.6 million, mainly due to strong growth of product sales, helped buffer the effects of mounting expenses. Product sales for the period soared 38% to $118.4 million on growth of marketed products and increases in manufacturing revenue and royalties.
Turnover of marketed drugs grew 14.5% to $52.1 million, lifted by good performances from the anti-infectives Maxipime (cefepime) up 2% to $33.8 million, and Azactam (aztreonam), rocketing 36% to $17.0 million.
In addition, sales of Prialt (ziconotide), a new treatment for severe chronic pain which was cleared in the US late last year [[04/01/05d]], helped grow total sales though, at $1.5 million they were slightly under the $1.8 million generated for the second quarter, due to increased demand offset by reduced wholesaler inventories, the group noted.
Manufacturing revenue and royalties was leapt 99% to $57.8 million, reflecting higher sales by third parties of products using the firm’s technologies, and increased manufacturing activity for third parties.
Commenting on the results, Shane Cooke, executive vice president and chief financial officer, said, “We are pleased that the core business, excluding Tysabri, continued to perform strongly with product revenues up over 40% over last year…We continue to aggressively manage our cost base while not compromising revenue growth or our ability to re-launch Tysabri, and are optimistic that the business, excluding Tysabri, is on track to achieve our target of breakeven, on an EBITDA basis, by the end of the year.”