Merrill reiterates Elan sell rating

Elan Corp.'s sell rating was retained by Merrill Lynch. The company's third-quarter results showed higher revenues ($129 million versus Merrill's $124 million estimate), lower research and development expenses ($60 million versus a $69 million estimate) and a lower loss per share ($0.16 versus a $0.20 estimate). However, analyst Erica Whittaker said that Tysabri - on which development was recently halted due to poor efficacy - will re-enter the market, but only under a restrictive risk management program, and that sales of the drug would have to reach over $1 billion before Elan could become profitable and repay its debt. Shares of the Dublin, Ireland-based biotechnology company were down $0.38, or 4.52%, at $8.02 on volume of 4,849,000 shares versus the three-month running average of 6,327,590 shares.

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