Having firmly rebuked rumours last week that the company is in takeover talks with Pfizer, Elan admitted today that something fairly dramatic may be required to drag itself out its current predicament with news the Irish group has hired Citigroup to explore “strategic alternatives”, which could include a “minority investment or strategic alliance, a merger or sale”.

Faced with potentially crippling debt repayments of $1.77bn, starting in 2011, Elan’s recent attempts to cut costs only scratched the surface of the problem (Elan's "realignment" not enough, December 12, 2008), and today’s announcement also failed to excite investors; in early trade Elan’s shares rose just 1% to $8.13. With an enterprise value of $5.1bn largely tied to the debt and two already partnered products, MS drug Tysabri and Alzheimer’s candidate bapineuzumab, unless one of the respective partners, Biogen Idec and Wyeth, can be convinced a buy-out of Elan would significantly add value, shareholders hoping to profit from a takeover premium are likely to be disappointed.