Sunday, September 30, 2007

Elan shares plummet on new MS drug concerns

Saturday September 15 2007

Shares in drugmaker Elan plummeted yesterday following fears that a patient taking the company's multiple sclerosis drug Tysabri had a virus called JC -- the precursor to the often fatal disease which caused the suspension of the drug's sales back in 2005.

The shares finished yesterday down 7.2pc at €13.13 having fallen over 9pc earlier, shadowing a drop in the US. The shares were at $18.86 in early US trade but had fallen to $18 earlier from a close of $19.48 on Thursday night.

Analysts said yesterday, there are growing concerns that the US Federal Drug Administration (FDA) has received an adverse event report from a doctor who had detected the JC virus which is a precursor to progressive multifocal leukoencephalopathy (PML).

Although 80pc of the population have antibodies to the virus, if a person has a weak immune system the JC virus can cross over the blood/brain barrier into the brain. The virus persists in the kidney.

Back in 2005, Elan shares plummeted by 70pc on the Dublin Stock Exchange after it and its partner Biogen said they were suspending sales of their much-heralded multiple sclerosis drug Tysabri.

The move followed the news that one patient died of PML, a rare and often fatal disease of the central nervous system known as an opportunistic infection, after being treated with Tysabri in combination with Biogen's MS drug Avonex.

This latest patient, however, has not been confirmed as having the PML virus. Elan said that it has no new confirmed cases of PML.

It added that it gave the FDA a full safety update at the end of July..

Analysts said yesterday that the share slump was probably a result of panic selling especially as no new cases of PML have been reported.

"Previous adverse reports when Tysabri was under a market suspension proved to be unfounded," said one analyst who did not wish to be named.

In 2005, the two companies said there was one fatal, confirmed case and one suspected case of PML.

The companies also suspended dosing in all clinical trials of the drug. The action was been taken in consultation with the US FDA at the time.

Earlier this week, Tysabri received backing from a Scottish health watchdog for its MS drug.

The Scottish Medicines Consortium (SMC) today advised the use of Elan's and partner Biogen's drug Tysabri in people with active relapsing remitting multiple sclerosis.

All NHS Health Boards in Scotland are now obliged to consider the SMC's advice and ensure that Tysabri is made available to meet patients' needs.