By Brady Huggett

Elan Corp. plc made an offer Quadrant Healthcare plc couldn't refuse and acquired the UK-based company, bumping Inhale Therapeutics Systems Inc. out of the bidding room.

Inhale, of San Carlos, Calif., made a cash offer for Quadrant of 60 pence (US87 cents) per share and said early last week it intended to complete the deal in 60 to 90 days. The offer of 60 pence per share set the estimated value of Quadrant at #41.8 million (US$59.7 million). The companies had litigation proceedings commenced on patent infringement for glass stabilization technology, and if the deal had gone through, it could have resolved the dispute.

Then Elan tendered an offer. Elan - a company that already held 5 million shares (7.2 percent) of Quadrant's stock, holds warrants to purchase another 500,000 Quadrant shares, and its wholly owned subsidiary, Monksland Holdings B.V., holds Quadrant loan notes worth US$12 million - offered 75 pence per share. Overall, Elan holds or has undertakings for 32.5 percent of Quadrant's issued stock. Quadrant accepted the offer. Elan's offer estimated Quadrant's worth to be #52.3 million (US$75.9 million).

Elan, of Dublin, Ireland, focuses on the discovery, development and marketing of therapeutic products and services in neurology, acute care and pain management. Elan said it could not comment on the proceedings, and Inhale said it was considering its position on the matter and planned to respond later.

Inhale's drug delivery platform combines innovations in powder technology and inhalation devices to deliver inhalable drugs. It raised around $200 million in early October through the sale of convertible subordinated notes and said it planned to use the money for product development and possible acquisitions. Quadrant develops technology to enhance the delivery of medicines in inhalable, oral and injectable forms. (See BioWorld Today, Oct. 11, 2000; and Oct. 23, 2000.)

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