Elan (NYSE:ELN) collected an $885 million investment from Johnson & Johnson (NYSE:JNJ), but so far it isn't using much of that money to pay down its long-term debt.

The company announced yesterday that it was going to retire $850 million in fixed-rate notes that were scheduled to be due in 2011, but it also announced that it was issuing $600 million in new debt due in 2016.

That's not necessarily a bad idea -- especially if it can price the new debt at a lower interest rate than the 7.75% it was paying on the old debt. At the end of last year, it had $1.15 billion due in 2011 and $615 million due in 2013, so there's still plenty of debt left to be paid off.

Still, it would be nice to know exactly what is Elan planning on doing with the $600 million or so it'll have left over from the Johnson & Johnson investment. Investors are hoping the company can get into the black, and lowering interest payments will go a long way toward doing just that.

In the same 6-K filing discussing the debt offering, the company also announced that it is under investigation by the Securities and Exchange Commission. I guess filing an extra 6-K was too much trouble, or maybe the company was hoping investors wouldn't notice?

Well, we did.

The SEC has requested information about the July announcement of two cases of progressive multifocal leukoencephalopathy (PML) in patients on Elan's and Biogen Idec's (NASDAQ:BIIB) multiple sclerosis drug Tysabri. The agency also requested information about phase 2 trial data for Alzheimer's drug bapineuzumab, which Elan and Wyeth (NYSE:WYE) released at the International Conference of Alzheimer's Disease last year. Bapineuzumab is now owned 25% by Elan, 25% by Johnson & Johnson , and 50% by Wyeth, which Pfizer (NYSE:PFE) will inherit when it closes its acquisition later this year.

The SEC investigation may turn out to be nothing, but it doesn't exactly give you a warm, fuzzy feeling for a company that's had such a rocky past. It sure would be nice if the company would give investors a little more insight into both of yesterday's announcements.

Elan is a Motley Fool Rule Breakers pick. The newsletter service is always on the hunt for hot drug stocks and other cutting-edge picks. See all of our latest discoveries with a free 30-day trial subscription.

Fool contributor Brian Orelli, Ph.D., doesn't own shares of any company mentioned in this article. Pfizer is an Inside Value pick. Johnson & Johnson is an Income Investor selection. The Fool has a disclosure policy.