Biogen Idec Inc. ( BIIB - Analyst Report ) and partner Elan Corporation ( ELN - Snapshot Report ) recently submitted applications to the US Food and Drug Administration (FDA) and European Medicines Agency (EMA) seeking to update the label of their multiple sclerosis (MS) drugTysabri (natalizumab).

The companies are looking to get Tysabri approved as a first line treatment for patients suffering from certain relapsing forms of multiple sclerosis (MS) who have tested negative for antibodies to the JC virus (JCV).

The application is based on risk stratification data. Tysabri slows disability progression by 42% – 54% and reduces annualized relapse rates by 68%.

Tysabri is the primary growth driver at Elan. As per Elan, Tysabri global net sales in the third quarter of 2012 rose 9.8% to $306.4 million. However, third quarter 2012 Tysabri revenues at Biogen declined 1% to $275 million.

We note that Tysabri is approved in the US for treating relapsing forms of multiple sclerosis (MS) in patients who show inadequate response to or are unable to tolerate other treatments. In the EU, Tysabri is approved for treating highly active relapsing-remitting MS (RRMS) in adults who have severe RRMS or have not responded to beta interferon treatment.

In the EU, Tysabri was approved in 2006 and in the US it was initially approved in 2004. The product was withdrawn from US markets in 2005 due to the progressive multifocal leukoencephalopathy (PML) concern. The drug was reintroduced by Biogen and Elan after a year with a strict warning regarding the occurrence of PML.

We currently have a Neutral recommendation on both Biogen and Elan. While Biogen carries a Zacks Rank #3 (Hold) in the short run, Elan carries a Zacks Rank #2 (Buy). Right now Valeant Pharmaceuticals ( VRX - Snapshot Report ) looks more attractive with a Zacks Rank #1 (Strong Buy).