Biogen Idec won't have much time to wait before a court considers negating its partnership with Elan on their multiple sclerosis treatment Tysabri. In fact, it won't have as much time as it had counted on. The federal court judge in the case said a hearing August 31 will focus on the partnership fight itself, rather than on procedural matters as Biogen had thought.
The tussle over Tysabri has roots in the agreement itself: If either partner is acquired, the other has the right to buy full Tysabri rights. Elan inked a deal with Johnson & Johnson, under which the larger company would finance Elan's takeover of Tysabri, if the opportunity arose.
Biogen, as you know, has been the subject of much deal talk, largely because shareholder Carl Icahn has been pushing for a sale or split of the company, and Icahn recently won two seats on Biogen's board. Apparently, Biogen is a bit nervous that J&J's agreement to finance a Tysabri buy might even make J&J a Biogen bidder. So Biogen raised the red flag, saying the Tysabri partnership should be terminated in light of those arrangements.
Elan sued Biogen in an attempt to protect the partnership, saying that it's within its rights to set up a financing arrangement. And Elan has said that it doesn't mind amending its agreement with J&J if necessary. We'll find out how the court feels about it at the end of the month.
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