Elan's partner search bears little fruit

When, oh when, will Elan find a deal? The Irish drugmaker has tried and failed with several potential partners since it hired Citigroup in January to assess its options. With the collapse of talks with Bristol-Myers Squibb, Reuters now asks, who's left? "The market has run through a fair number of partners by now--we've had Pfizer, Roche, Bristol-Myers Squibb and Lundbeck," Goodbody Stockbrokers analyst Ian Hunter told the news service. "There may not be that many left looking at it."

Complicating matters is the fact that Elan works under two drug partnerships: Its Tysabri arrangement with Biogen Idec, and its co-development of Alzheimer's drug bapineuzumab with Wyeth. Plus, any real indication on bapineuzumab's prospects for approval won't come till study results are released in mid-2011.

And Elan needs the cash. Analysts estimate that the company requires at least €500 million ($708 million) to roll over its debt, Reuters reports. It tried to sell off its drug-delivery business last year, but wasn't able to complete a deal as credit markets collapsed. If it can't find a minority investor at terms it likes, it could sell off its stake in Tysabri or gin up some capital via the equity markets. But finding that partner is its best option. We'll see if the company can pull it off.

- read the Reuters story