Elan set for first profit in a decade

Irish drugmaker Elan expects to post a 20 per cent jump in 2011 adjusted core earnings after a 5 per cent increase in 2010 revenue and cost cuts enabled it to record its first operating profit since 2001.

Elan, in which US group Johnson & Johnson is an 18 per cent shareholder, reported a 5 per cent rise in full-year revenue to $1.2bn yesterday, close to the $1.16bn forecast in a poll by Reuters.

Revenue was boosted by an 18 per cent increase in sales of multiple sclerosis drug Tysabri, which Elan makes in partnership with Biogen Idec.

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The revenue increase combined with a 9 per cent drop in operating costs, before other charges and gains, led to a jump of 73 per cent in adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) to $166.5m.

Overall, however it posted a net loss for the year of $325m due to problems with its Zonegran drug.

Elan said the net loss for the year rose from $176.2m to $324.7m and was mainly due to the settlement agreement it reached with the US government regarding Zonegran.