Royalty Pharma has raised its offer to buy Elan Corp, in a move that values the Irish drugmaker to up to $7.30 billion.

After being told by the Irish Takeover Panel earlier this month to make a concrete bid by May 10 or walk away, Royalty has made what it calls a "firm, fully-financed offer". Earlier it had made what Elan called "an indicative proposal" of $11 per share, or around $6.50 billion.  

The value of Royalty's latest bid is staggered depending on the pricing of a $1 billion share buyback that Elan received stockholder approval for last week. The offer ranges between $11.25 and $12, depending on the level Elan shareholders tender their stock.

Elan unveiled plans for the buyback following the sale of its stake in the multiple sclerosis blockbuster Tysabri (natalizumab) to partner Biogen Idec for $3.25 billion, plus royalties. The Dublin-based group's chief executive Kelly Martin said in February that the firm has been vaulting assets around the world and establishing relationships that might lead to "constructive strategic transactions".

Royalty chief executive Pablo Legorreta said that "Elan today consists of cash and a royalty on Tysabri" and claimed his company is better placed to manage such a business than the current leadership. He added that "in order to obtain the full amount of our offer in cash in the shortest timeframe, Elan's shareholders should encourage the board to engage immediately with Royalty".

Royalty, which was established in 1996, controls rights to 37 drugs, including AbbVie's Humira (adalimumab) and Johnson & Johnson/Merck & Co's Remicade (infliximab). Elan has yet to give a definitive response, limiting itself to saying that it will "promptly assess the Royalty announcement and will advise its shareholders accordingly".