S&P: Elan unaffected

Standard & Poor's said the ratings and outlook on Elan Corp. plc (B/stable/--) would not be affected following reports that a patient enrolled for clinical trials of one of the company's drugs had suffered a rare brain infection.

This was the third patient enrolled in trials for the multiple sclerosis treatment Tysabri to suffer progressive multifocal leukoencephalopathy (PML).

Tysabri was approved by the U.S. Food and Drug Administration in November 2004 but withdrawn from the market in February when two patients developed PML while being treated with a combination of both Tysabri and Biogen Idec Inc.'s multiple sclerosis treatment Avonex.

S&P said Tysabri is critical to Elan if the company hopes to return to profitability and restore positive cash flows.

While this latest case of PML makes the drug's return to market more uncertain, S&P said Elan still has $1.5 billion of cash on hand and does not face significant debt maturities until February 2008.

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