NEW YORK (AP) -- Shares of Amag Pharmaceuticals Inc. sank Wednesday after the company said it is taking a batch of its anemia drug Feraheme off the market following the death of a patient.
THE SPARK: Amag said its partner Takeda Pharmaceutical is taking a batch of the drug off the market in Switzerland. Amag said four patients experienced severe allergic reactions to the drug, and one of those patients died. That batch was sold only in Switzerland, and the recall doesn't affect any other countries.
THE BIG PICTURE: The FDA approved Feraheme, or ferumoxytol, in 2009, as a treatment for iron deficiency anemia. In the U.S., it is approved for use in patients with chronic kidney disease. European Union regulators approved the drug in 2012 under the name Rienso. Takeda markets the drug in Europe.
Amag reported $58 million in U.S. sales of Feraheme in 2012, and it expects $63 million to $67 million in 2013.
Severe allergic reactions are a side effect common to several anemia drugs. Early this year Affymax Inc. and Takeda pulled their anemia drug Omontys off the market after several people taking it died and about 50 had severe allergic reactions. It's not clear if Omontys will make it back to the market. The Food and Drug Administration approved Omontys in March 2012, several years after Feraheme was approved.
Sales of Amgen Inc.'s drugs Aranesp and Epogen have fallen over the years because of a variety of safety concerns and limits on their use.
THE ANALYSIS: Leerink Swann analyst Joseph Schwartz said he does not think the recall will have a big impact on Feraheme sales in larger markets. He said Feraheme appears to have a lower rate of side effects than competing drugs even though patients with chronic kidney disease tend to have a lot of health problems.
He maintained an "Outperform" rating on the stock.
SHARE ACTION: Amag shares fell $2.68, or 10.7 percent, to $22.40 in afternoon trading. The stock has climbed 49 percent since March 1 and has nearly doubled in value over the last year, reaching a two-year high of $25.67 on May 15.