Elan confirms plan for the eventual sale of Athlone plant

Elan has reiterated it is planning to sell its Athlone site 'at some time in the future'. The company has also indicated it may close or downsize two of its eight plants as part of an effort to reduce its debts. Elan"s chief executive Kelly Martin stated last week that the company hadn"t decided which locations would be affected by the possible closures. Speaking at a Reuters health summit in New York, Mr Martin stated: 'We are currently going through a process where we are evaluating where we can take costs down and reallocate and reduce. There are a couple of locations we can potentially exit entirely.' In addition to its plant in Monksland, Elan has its headquarters in Dublin and other facilities in San Francisco, New York, Boston, Pennsylvania, Georgia and Tokyo. It"s not considered likely that the Athlone site would be closed. Mr Martin said that the company would continue to have its headquarters in Dublin, and he described the Athlone facility as 'a very successful and highly profitable business'. Elan has already attempted to sell the Elan Drug Technology business which is operated as an independent entity and includes its Athlone site. The business is believed to be worth $1 billion. That effort was thwarted by the uncertainty in the global financial markets. Discussing the EDT business, the Elan CEO said: 'We will continue to run it as a good business. There"s a lot of things that are going to happen this year which we think will make the business even better. So we will not change anything. 'We"ve a good management team, we have good technology, we have good IP, we have good product prospects, so we will continue to run the EDT business and we expect that business to grow as it has done over the last five years.' Asked if the company still intends to sell the EDT business, Mr Martin replied: 'At some point in the future. If the markets normalise at some point and if we keep growing the business... I think what we were trying to do with EDT was allow that business to have access to the public market so they could raise capital on their own and reinvest in their business for even more growth opportunities. If that opportunity arises both myself and the board would pursue it.' Last month, Mr Martin said he expected an announcement before Christmas on a planned 500-job expansion of Elan"s manufacturing operation. This new biological manufacturing plant was originally proposed for Athlone, but it"s thought that Dublin is now the most probable location for the project. Elan posted a net loss of $240.5 million in the first nine months of 2008, and the company intends to raise about $400 million (€319 million) by the middle of next year. Mr Martin last week said that Elan was determined to retain its drugs for neurological disorders, including experimental products to treat Alzheimer"s disease and Parkinson"s disease. However, he said that in some other operational areas, such as 'oncology or certain auto-immune areas... it may make very good business sense to seek partners who have expertise in those very specific areas in which we, frankly, do not.' He acknowledged that Elan"s future success was heavily dependant on its multiple sclerosis drug, Tysabri. 'About every 10,000 patients who use Tysabri (represents) about $100 million dollars in profitability for Elan, so that"s a significant part of our next few years of operating,' Mr Martin said.