My Foolish colleague made some good points about why Elan (NASDAQ:ELN) is a good company, but its shares being unequivocally undervalued wasn't one of them.

I could write a book on the relative efficacy and safety of Tysabri versus the other MS CRAB treatments (enterprising investors can start by comparing the different MS drug labels found here), but I'll be brief: As with every drug, the safety of Tysabri is just as important as its efficacy.

There are numerous effective therapeutics that never made it to market, or saw their sales crimped, because of excessive side effects. This is especially true for drugs treating cancer or neurodegenerative diseases. With the dearth of safety data available for Tysabri, we still don't know the drug's long-term effects on patients with this chronic indication.

For example, the rate at which the drug increases the chance of patients developing a rare but usually deadly infection named progressive multifocal leukoencephalopathy (PML) is still unknown. This is the reason why the drug was initially pulled from the market. Investors who focus only on efficacy data sometimes forget the risks.

And I have to disagree that there are no "credible" treatment modalities on the horizon for multiple sclerosis. Earlier this week, Biogen Idec (NASDAQ:BIIB) and partner PDL Biopharma (NASDAQ:PDLI) announced positive phase 2 results for a drug candidate to treat MS, and other well-funded drug makers like Genzyme (NASDAQ:GENZ) and Novartis (NYSE:NVS) have novel MS treatments in late-stage development that could be on the market as early as 2009. Any of these products could go on to marginalize Tysabri (and some of the other treatments, for that matter) in the future.

One last word on Tysabri: I hope it goes on to become a miracle cure. There's no question that MS is truly a terrible disease. The question for investors is whether Elan will be the company to provide that cure. With so many risks and unknowns embedded with the drug, I'm not convinced Elan, at least with Tysabri, will be the one.

You're not done yet!

Biogen Idec is a Stock Advisor recommendation, and PDL Biopharma is a Rule Breakers recommendation.

Fool contributor Brian Lawler is a mean old man who does not own shares of any company mentioned in this article. The Fool has a disclosure policy.