Elan Corp is still not impressed by Royalty Pharma's $6.50 billion takeover bid as the private fund stepped up its efforts to persuade the Irish drugmaker's shareholders to accept the offer.
Royalty has issued a statement saying that it remains committed to acquiring Elan but "continues to be disappointed that the board has not engaged in discussions". It claims to be "ready and able to move quickly to implement an offer and believes that it will be able to complete due diligence in 20 days".
Royalty noted that it is meeting with a number of Elan shareholders to discuss the proposal. These include Johnson & Johnson which holds an 18% stake in the group.
The approach to buy Elan came after the Dublin-based drugmaker unveiled plans to return $1 billion to stockholders and explore acquisitions of its own, following the sale of its stake in the multiple sclerosis blockbuster Tysabri (natalizumab) to partner Biogen Idec for $3.25 billion, plus royalties. Earlier this week, Elan added that it intends to pay directly to shareholders a fifth of those Tysabri royalties.
Royalty argues that following the completion of the Tysabri transaction, "the field of likely acquirors of Elan will have narrowed sharply". It does not believe pharmaceutical or biotech companies would be interested, given that its material assets will consist of cash and the Tysabri royalty, so "the only companies that would be interested in acquiring Elan would be financial buyers" and Royalty believes that "it may be the only credible buyer capable of acquiring the whole of Elan".
Elan responded with a short statement repeating its previous view that "the highly conditional indication of interest is opportunistic in its timing", adding that "any credible proposal which may be made by Royalty or any other party will of course be considered".