The company's changes inspire little enthusiasm in the market and fail to give much-needed boost to share price.

Elan has announced a shake-up of its management team as part of a bid to restore investor confidence in the troubled company.

Executive vice-chairman Mr Tom Lynch is stepping aside to take over responsibility for resolving the inquiry by the US Securities and Exchange Commission (SEC) into the company and related shareholder litigation.

"In order to devote the required time and energy to these matters, Tom will relinquish his current responsibilities to focus on this task," a company statement said.

People close to Elan said Mr Lynch was paying the price for the use of off-balance sheet vehicles during his time as chief financial officer to reduce the amount the company appeared to be spending on R&D. "He's been asked to clean up the mess he made," said one.

Mr Shane Cooke, who joined Elan as chief financial officer last July, would now directly manage all operational finance activities through a single, consolidated finance function, Elan said.

The company also announced that the head of its biopharmaceutical division, Mr Dan Welch, was leaving the company after just two years. "As a result of the reorganisation and the elimination of the divisional structures, Dan Welch has elected to leave Elan and pursue other interests," the company said.

The shake-up inspired little enthusiasm in the market, however, with one analyst describing it as "window dressing". It also failed to boost the beleaguered share price, which remained in the doldrums, falling a further 1.14 per cent to $6.92 in New York yesterday.

"There have been lots of chops and changes but the roles of chairman and chief executive remain the one job and there has been no change to either," a fund manager said.

Elan also said yesterday that Mr Timothy Wright, who has been in charge of Elan's international sales and marketing, would take on responsibility for the US, the company's most important market. He will take over some of the functions previously carried out by Mr Welch.

Mr Seamus Mulligan, named earlier to head up Elan Enterprises, the new unit charged with overseeing the company's business ventures and its divestment process, will also take on responsibility for global business development and planning.

Meanwhile, Mr Lars Ekman assumes full responsibility for all research and development activities within the company, other than at its drug delivery service business.

The changes were announced in the wake of an action plan, detailed earlier this week, that aims to halt the slide that has seen the shares in what was the Republic's largest company by market capitalisation lose more than 85 per cent of their value since January.

Under fire from investors for its opaque network of joint ventures, whose debt levels have frightened some shareholders,

Elan has pledged to simplify its balance sheet and sell off some units. The plan will see Elan concentrate on three core divisions and sell non-strategic assets.

"In order to streamline our business, we need to fundamentally change and reshape our organisation to meet the challenges that we face to become a fully integrated biopharmaceutical company," Elan's chairman and chief executive, Mr Donal Geaney, said yesterday.

A spokesman for the company said the programme was already under way and should be finished by December 2003, without significant lay-offs among its 4,500 employees.

(Additional reporting: Financial Times Service)