Shares in Elan gained nearly 10 per cent in Dublin this morning on news it had settled a pending lawsuit with King Pharmaceuticals relating to the planned sale of its primary care franchise to the US group.
US-based King will pay around $750 million for Elan's Sonata and Skelaxin drugs. Elan will receive additional future royalty payments if the drugs retain their patents.
King initially agreed in January to pay $850 million for rights to thetwo drugs but threatened to back out after US regulators questioned whether Elan tried unfairly to block a generic rival of Skelaxin.
The Federal Trade Commission dropped part of its investigation earlier this month clearing the way for further talks betweenElan and King, even though King said it was nolonger interested in the deal.
King will also offer employment to Elan's 375 primary care employees.
Elan said this morning it had raised $1.6 billion from the sale of non-core businesses as part of its restructuring. Cash balances at March 31st rose by about $312 million to about $1.3 billion, Elan said.