Elan today cut its losses by slightly less than expected in the second quarter.
But the company said it was set for a return to profitability thanks to the relaunch of its Tysabri multiple sclerosis drug.
Elan said it had cut its loss per share in the three months to the end of June to 21 cents from 35 cents in the same period last year.
Total revenues in the quarter rose 15 per cent to $136.4 million, in line with analysts' expectations that they would reach $137 million.
Tysabri, which Elan and US partner Biogen Idec relaunched in July after last year's suspension over links with a rare and potentially fatal brain disease, is seen as key to Elan's future following a brush with bankruptcy in 2002.
Analysts polled by Reuters expect Tysabri to generate revenues for the two companies of $56.75 million this year, rising to annual sales of $1.77 billion by 2010. The drug's troubled past means forecasts vary widely, however.