Royalty Pharma makes unsolicited bid for Elan

Royalty Pharma said this morning that contact was made on Monday February 18, 2013 with the chairman of Ireland-based drugmaker Elan Corp (NYSE: ELN) followed by a meeting then taking place on Wednesday February 20, 2013, at which an indicative proposal was made to acquire the entire issued and to be issued share capital of Elan.

Elan, which recently gave up rights to its only drug asset, Tysabri (natalizumab) and outlined plans of how it would deploy the $3.25 billion payment received from Biogen Idec (The Pharma Letters February 7 and 22), had made no comment on the situation by the time this story was filed.

Royalty Pharma, a private entity founded in 1996 and is the investment manager to entities investing in royalty interests in marketed and late stage biopharmaceutical products,
is proposing, on an indicative basis, to make an offer for Elan of $11 for every Elan share and every Elan American Depositary Share. This is a cash premium of 12.6% to the current enterprise value of Elan based on the closing share price on February 15, 2013 of $10.35 on the New York Stock Exchange, and a cash premium of 6.3% to the closing share price of Elan Stock on February 15, 2013 of $10.35 on the New York Stock Exchange;