This excerpt taken from the ELN 6-K filed Aug 28, 2009.
Johnson & Johnson Transaction
On 2 July 2009, following completion of a strategic review announced in January 2009, we announced a definitive agreement whereby Johnson & Johnson will acquire substantially all of the assets and rights of our AIP, through a newly formed Johnson & Johnson company. In addition, Johnson & Johnson will invest $1 billion in Elan in exchange for newly issued American Depositary Shares of Elan which will represent 18.4% of our outstanding ordinary shares.
Johnson & Johnson will assume and continue our activities with Wyeth under the AIP and will initially commit up to $500 million to continue the development and launch activities of bapineuzumab, a potential first-in-class treatment that is being evaluated for slowing the progression of Alzheimers disease, as well as other compounds. The agreement provides for additional funding obligations of the parties if needed.
In consideration for the transfer of these rights and assets, we will receive a 49.9% equity interest in the newly formed Johnson & Johnson company that will acquire the AIP. We will be entitled to a 49.9% share of the profits and certain royalty payments upon the commercialisation of products under the collaboration with Wyeth.
The closing of the transaction, which is subject to customary closing conditions, is expected in the second half of 2009.
In the context of the transaction with Johnson & Johnson, we are re-evaluating our longer term biologics manufacturing and fill-finish requirements, which may result in futher non-cash asset impairment charges. At 30 June 2009, the carrying value of these assets amounted to $47.5 million.
Biogen Idec Matter
We have filed suit against Biogen Idec in Federal District Court in New York seeking declaratory and injunctive relief that aspects of Elans recently announced transaction with affiliates of Johnson & Johnson comply with Elans Collaboration Agreement with Biogen Idec for the development and marketing of Tysabri (the Tysabri Agreement).
In a letter to Elan dated 28 July 2009, Biogen Idec alleged that Elan was in material breach of the Tysabri Agreement. Biogen Idecs assertion against Elan relates to Elans ability to obtain financing from an affiliate of Johnson & Johnson to potentially purchase Biogen Idecs Tysabri rights, if Biogen Idec undergoes a change of control. Elan strongly believes that it is in compliance in all respects with the Tysabri Agreement.
In seeking declaratory relief, Elan has requested that the Court conduct expedited proceedings given the sixty day cure period following which Biogen Idec may seek to terminate the Tysabri Agreement. Elan also requested that the Court enter judgement against Biogen Idec permanently enjoining Biogen Idec from terminating the Tysabri Agreement based on Biogen Idecs 28 July 2009 letter. The Court has scheduled a hearing on this matter for 10 September 2009.