Cowen analyst: Elan drug could be a blockbuster

Biotechnology company Elan Corp. could reap blockbuster rewards from its developing Alzheimer's disease drug bapineuzumab, but the drug likely won't hit the market for years, a Cowen and Co. analyst said Tuesday.

American Depository Shares of the Irish company rose 74 cents, or 2.2 percent, to $34.95 in afternoon trading.

The stock has been on the upswing since the middle of June, when the company said results of a midstage trial showed bapineuzumab helped Alzheimer's patients who lack a certain gene _ a large subgroup of the patient population. Shares reached $36.08 on July 2, their highest point in more than seven years.

"Elan's lead drug development candidate, bapineuzumab, could be the first disease modifying treatment for Alzheimer's disease, targeting a multibillion dollar market opportunity," Cowen analyst Ian Sanderson said in a note to investors. He estimates potential sales of $7 billion to $8 billion in 2015.

However, with the drug only midway through development and not likely to reach market until 2011, Sanderson said Elan's stock has limited near-term upside potential.

He started coverage of shares at "Neutral."

Shares of Elan's development partner, Madison, N.J.-based Wyeth, rose $1.38, or 2.9 percent, to $48.96. The stock has traded between $38.39 and $58 over the last 52 weeks.