CORRECT: Elan Confirms Outlook As Quarterly Net Loss Narrows

("UPDATE: Elan Confirms Outlook As Quarterly Net Loss Narrows," at 0748 GMT, misstated its current listings in the 6th paragraph. The same mistake appeared in an item at 0647 GMT. The correct version follows:)

--Elan confirms full-year guidance

--Says EDT sale to close in second quarter

--Tysabri sales up 31% in latest three months

(Adds detail in fifth, seventh, ninth and 10th paragraphs.)

   By Sten Stovall 
   DOW JONES NEWSWIRES 
 

Irish drug maker Elan Corp. PLC (ELN) Wednesday reaffirmed its full-year guidance despite recording a net loss in the second quarter, and said a transformational deal to sell its drug technology unit EDT to U.S.-based Alkermes Inc (ALKS) remains on track.

The sale will allow Elan to fund medicine innovation with its remaining BioNeurology business and to pay down debt.

The company's new chief finance officer, Nigel Clerkin, said the sale will "transform Elan's balance sheet by moving us from net debt to net cash and investments."

He added that, even though there will no longer be any EDT contribution in the fourth quarter, Elan reaffirms its full-year guidance of adjusted earnings before interest, taxes, depreciation and amortization to exceed $200 million. It also expects the BioNeurology business to achieve adjusted Ebitda in excess of $135 million for the full year, up from its previous guidance of over $100 million.

Under the deal, announced in May, EDT and Alkermes will be combined under a new holding company incorporated in Ireland. The group, in which Elan will have a 25% stake, will focus on products dealing with the brain and is expected to have annual revenue of around $450 million from 25 products, including treatments for schizophrenia and pain.

Dublin-based, New York-listed Elan reported a narrowed net loss in the three months to end-June of $47.1 million, from a $217.9 million net deficit a year earlier. Elan delisted from the London Stock Exchange in 2009.

The company said its latest net quarterly loss includes a net loss on equity method investments of $39.1 million relating mainly to the investment in Johnson & Johnson's (JNJ) Janssen Alzheimer Immunotherapy. An impairment charge of $5.1 million was also booked for the planned closure of Elan's King of Prussia, Pa., site by the end of September and transferral of current projects and technology capabilities to other locations.

Sales for the second quarter were up 24% over the period, to $333.5 million.

During the quarter, there was a 31% jump in sales of flagship multiple sclerosis treatment Tysabri, which is sold by Elan and U.S.-based partner Biogen Idec Inc. (BIIB), to $389.0 million. That growth mainly reflects increased patient demand globally and a higher price in the U.S., along with favorable foreign currency movements, Elan said.

Excluding the EDT business, Elan said it now expects total revenues to be around $1 billion this year, driven by continued Tysabri growth, with turnover doubling over the next five years to some $2 billion in 2016.

Elan shares, which have more than doubled so far this year, opened 0.9% higher at EUR8.60.

-By Sten Stovall, Dow Jones Newswires; [phone]; [e-mail]