The US Food and Drug Administration has issued an alert saying it is working with Biogen Idec and Elan Corp to change the product labelling for Tysabri.

The agency’s move is unsurprising after the firms reported two new cases of the rare brain disease progressive multifocal leukoencephalopathy in Europe in patients with multiple sclerosis taking Tysabri (natalizumab) as monotherapy. The agency confirmed that these are the first cases of PML that have been reported following the drug’s re-appearance on the market in June 2006.

However, the FDA said it "still believes that Tysabri monotherapy may confer a lower risk of PML than when Tysabri is used together with other immunomodulatory medications”. It also noted that no new cases have been seen in the USA, where about 3,300 patients have received the drug for at least one and a half years.

Meantime, a number of private equity firms are interested in making a bid for Elan’s drug delivery unit. Bain Capital has emerged as a potential buyer for Elan Drug Technologies and Reuters has reported that Warburg Pincus may also make an offer.

The sale of EDT is expected to bring in up to $1.4 billion for Elan, which has seen its shares collapse of late over mixed results for its Alzheimer's drug candidate bapineuzumab, being co-developed with Wyeth, as well as its Tysabri problems. Other bidders mentioned in dispatches include Texas Pacific Group, Cinven, and Kohlberg Kravis Roberts.