With the abandonment by Elan ($ELN), Johnson & Johnson ($JNJ) and Pfizer ($PFE) of their long-shot Alzheimer's drug bapineuzumab, speculation is growing that Elan will be pushed into the arms of Biogen Idec ($BIIB). After all, they share ownership of Elan's only significant drug, the successful multiple sclerosis treatment Tysabri.
But while that buzz may be building, some analysts think there are factors that could delay the marriage, and other M&A scenarios are possible. Cowen and Co. analyst Ian Sanderson thinks selling out to Biogen was Elan's fall-back plan all along, but he tells The Deal Pipeline that an offer from J&J, Novartis ($NVS) or Teva Pharmaceutical Industries ($TEVA) is possible.
Novartis and Teva have positions in the multiple sclerosis arena where Tysabri would fit nicely. And J&J, Sanderson points out, already owns 18.4% of Elan's stock and has $1.9 billion invested in bapineuzumab's development. If nothing else, J&J might make an offer, forcing Biogen to exercise its right of first refusal on Tysabri, and so pocket a nice profit and recoup some of that investment if Biogen steps up. "It's a nice way for J&J to realize a quick return," he says.
But don't think a deal will happen immediately. Marko Kozul, analyst with Leerink Swann, tells clients in a note not to expect Biogen to do anything before the second half of 2013. He believes Biogen will wait to see how its oral dose multiple sclerosis drug BG-12 lands in the market assuming it is approved by early next year.
- here's more from Bloomberg
Pfizer, J&J give up the ghost on Alzheimer's drug
Elan faces uncertain future after Alzheimer's drug crash
Analysts see sale of Elan to Biogen Idec as likely
Biogen Idec builds blockbuster case for new MS drug BG-12