Elan establishes $206.3 million reserve for expected settlement
DUBLIN, Jul 15, 2010 (BUSINESS WIRE) --
Elan Corporation, plc (NYSE: ELN) today announced that it has reached an agreement in principle with the United States Attorney's Office for the District of Massachusetts with respect to the previously disclosed U.S. Department of Justice's investigation of sales and marketing practices for Zonegran (zonisamide), an antiepileptic prescription medicine that Elan divested in 2004.
If the agreement in principle is finalized, Elan expects to pay $203.5 million as part of a comprehensive settlement for all U.S. federal and related state Medicaid claims. Elan has established a reserve of $206.3 million for this expected settlement and related costs.
As part of this agreement in principle, Elan Pharmaceuticals, Inc., a U.S. subsidiary of Elan Corporation, plc, expects to plead guilty to a misdemeanor violation of the U.S. Federal Food, Drug and Cosmetic Act and to enter into a Corporate Integrity Agreement with the Office of Inspector General of the United States Department of Health and Human Services.
While Elan expects to negotiate and enter into final settlement and Corporate Integrity Agreements, there can be no assurance as to when or if any settlement will be finalized or, if a settlement is finalized, what the final terms of the settlement might be. Additionally, the proposed resolution of the Zonegran investigation could give rise to other litigation by state government entities or private parties.
Elan Corporation, plc is a neuroscience-based biotechnology company committed to making a difference in the lives of patients and their families by dedicating itself to bringing innovations in science to fill significant unmet medical needs that continue to exist around the world. Elan shares trade on the New York and Irish Stock Exchanges. For additional information about the company, please visit http://www.elan.com.