The cost of launching Tysabri is likely to double the first-quarter loss of Irish pharmaceutical group Elan.

Analysts surveyed by Reuters forecast a loss after tax of 32 US cents per share compared to 16 cents in the same period last year, when chief executive Kelly Martin unveils results on Thursday.

The company is also expected to outline significant cost-cutting proposals to help the company survive the suspension of the ill-fated drug that had been expected to be a blockbuster treatment for multiple sclerosis.

Elan and its US partner, Biogen Idec, took the drug off the market after two patients were diagnosed with a rare and generally fatal neurological disease, progressive multifocal leukoencephalopathy (PML), after taking part in a long-term trial of the drug in conjunction with an older Biogen treatment called Avonex. A third case of PML was subsequently diagnosed in a patient on a separate trial of Tysabri on its own.

In the aftermath of the suspension, Elan indicated it would update the market on the financial implications of the suspension and the subsequent collapse in the company's share price.

"I would imagine we're going to hear about likely cost reductions, cost control, and reducing cash burn," said ING Financial Markets analyst Richard Parkes.

The company's Dublin broker, Davy, last night said the drug's return to the market was "improbable but not impossible".

When it was launched last November after fast-track approval from the US regulator, Tysabri was expected to reach peak annual sales of between $2 billion (€154 billion) and $3 billion. Now, it is not projected to much exceed $500 million, with the drug being used only on patients not responding to other treatments, if at all.

Davy's Jack Gorman said that after recent high-profile controversies over a number of drugs, the Food and Drug Administration, "may itself be prone to a more cautious and conservative approach" in approving the return of the drug to the market.

(Additional reporting, Reuters)