Pharmaceutical group Elan will take a 19.9 per cent stake in a joint venture with the British pharmaceutical company CeNeS, which will use Elan's drug-delivery systems to develop some of CeNeS's morphine-based pain treatment products. Elan will also receive $15 million (€17.72 million) in licence payments for its drug-delivery system.

Elan will invest £4.2 million sterling (€7 million) to buy 7.8 million shares at 53.2p - equivalent to about 5 per cent of the enlarged CeNeS equity. In addition, Elan will invest a further £1.4 million sterling for up to 2.6 million further CeNeS shares at 30 per cent above the 60-day average when certain clinical targets have been reached.

Elan will also receive warrants to buy another 779,933 shares at 79.26p. CeNeS shares closed up 3p on 42-1/2p where the company has a market value of £60 million sterling.