What shareholders don't know about Elan/J&J deal

By Toni Clarke

BOSTON (Reuters) -- Irish drugmaker Elan Corp Plc (ELN.I) gave away more than it told investors in its recent $1.5 billion transaction with healthcare conglomerate Johnson & Johnson (JNJ.N)

J&J agreed to pay $1 billion for an 18.4 percent stake in Elan, and $500 million for a majority stake in its pipeline of experimental Alzheimer's disease drugs.

But Elan gave up more than that to get the deal done.

Reuters has learned from sources with knowledge of the situation that Elan has given J&J an option to acquire Biogen Idec Inc's (BIIB.O) 50 percent stake in the multiple sclerosis drug Tysabri, should there be a change of control at Biogen.

Kelly Martin, Elan's chief executive, declined to say whether he had given up one of Elan's most valuable assets. He told Reuters in a recent interview that more details of the deal will be revealed, but only after it has closed.

"There are certain things in the J&J transaction which have still to be made public and when we close and make them public, we make them public," he said.

Naturally both companies might be reluctant to reveal such an important piece of information. J&J has gained a right, that had previously been undisclosed, worth what some people familiar with the companies estimate to about $1 billion.

Elan and Cambridge, Massachusetts-based Biogen have a 50-50 partnership under which each has the right to acquire full control of Tysabri, which is now on track to generate $1 billion a year, should there be a change of control at either company.