Strong sales growth and higher margins boosted third-quarter post-tax profits at Elan by 37 per cent, to $183.5 million (€205 million). The pharmaceutical group reported earnings per share ahead of forecasts at 50 US cents for the three months to the end of September, from 38 cents for the third quarter of 2000.

Elan announced the purchase of a portfolio of pain management products from Roxane Laboratories for an undisclosed price "within industry norms" and said it was "cautiously confident" the US Food and Drugs Administration would approve its Frovelan migraine drug in the current quarter.

In weak markets, Elan shares, which fell in New York after the results, later recovered to finish at $49.82, up 1.32 per cent.

The company is actively working on a launch plan for Frovelan and is in discussions with potential marketing partners, according to chief financial officer Mr Tom Lynch. If approval was received in November, the drug could be launched before the end of the year, he said.

Elan was on course to meet its 2001 revenue target of "approaching" $2 billion, with expected revenue in excess of $500 million in the current quarter, he said. The new pain products acquisition, which had year 2000 sales of $50 million in the US, was part of the strategy to achieve the target, he added.

Elan's $190 million expansion at its Athlone plant was on schedule and under budget, Mr Lynch said. Elan employs 750 people in Athlone, 200 in Dublin and 4,500 worldwide. In the long term, employment at Athlone would increase, but the initial impact of the expansion would be an upgrading of the quality of jobs there, he explained.

Phase three trials of the multiple sclerosis drug Antegren and phase two trials to assess the efficacy of the experimental Alzheimer's drug, AN-1792, have started. Elan is seeking FDA approval for the Prialt compound used to treat chronic pain in AIDS and cancer patients.

Third-quarter revenue at the company was up 24 per cent to $484.3 million. Product revenue, accounting for 79 per cent of total revenue, was 44 per cent ahead at $381 million, with the gross margin up to 76 per cent from 68 per cent. Revenues for Zanaflex, Skelaxin, Abelcet and Maxipime were well ahead. Contract revenue was down 18 per cent, to $103.3 million. The strong third-quarter outcome follows a statement from Elan in mid-September to reassure the market, following a sharp share price fall. At that time, Elan said it was comfortable with earnings forecasts.