Elan "sell"

07/15/05 - Merrill Lynch

NEW YORK, July 15 (newratings.com) - Analysts at Merrill Lynch reiterate their "sell" rating on Elan (ELN).

In a research note published yesterday, the analysts mention that the company’s Tysabri drug is likely to be re-launched, given the drug’s substantial efficacy for the treatment of MS. The analysts believe that Tysabri’s per annum sales would not exceed $500 million, while Elan’s current share price assumes the drug’s sales at +$1 billion per year. The company’s debt liabilities and cash balance were $2 billion and $1.36 billion, respectively, at the end of 2Q, Merrill Lynch says. The analysts believe that it would be difficult for Elan to repay its debt liabilities, despite the potential re-launch of Tysabri.