Elan to start paying Tysabri dividend

Elan Corp. plc (NYSE:ELN) said its board approved a cash dividend policy under which it will pay shareholders a percentage of the royalties the company receives from partner Biogen Idec Inc. (NASDAQ:BIIB) under a restructured deal for multiple sclerosis (MS) drug Tysabri natalizumab. The dividend will be paid to shareholders twice yearly, with the first dividend expected in 4Q13. Shareholders will initially receive a dividend for 20% of the Tysabri royalties.

Last month, the partners said Biogen will pay Elan $3.3 billion in cash to acquire full Tysabri rights and IP. Elan will be eligible for 12% royalties on worldwide Tysabri sales for the first 12 months, after which Elan is eligible for 18% royalties on sales up to $2 billion and 25% royalties on sales over $2 billion. Elan subsequently said it will start a $1 billion share repurchase program with a portion of the upfront payment. Tysabri had $1.6 billion in 2012 global net sales. The deal is slated to close next quarter. ...