Health Stocks in Motion

Updated from 2:36 p.m.

Shares of Cantel Medical(CMN) were among the worst-performing health-related stocks Thursday, falling 41.3% after the company posted third-quarter results that fell below expectations and announced the termination of its distribution agreement with Olympus America.

The medical device maker posted earnings of $3.8 million, or 23 cents a share, on sales of $50.5 million. Analysts surveyed by Thomson First Call were expecting earnings of 26 cents a share on sales of $51.6 million. A year ago the company earned $3.1 million, or 20 cents a share, on sales of $46.9 million.

Cantel said its subsidiary, Carsen Group, would no longer serve as the Canadian distributor of Olympus America's products, effective July 31, 2006. As part of the termination agreement, Olympus will pay Cantel $6 million in cash for Carsen's transfer of customer lists, sales records and certain other assets related to the sale and servicing of Olympus products. Carsen will also release Olympus from restrictions on hiring Carsen personnel. In all, Cantel will receive net proceeds -- after the sale of inventory and collection of receivables, less liabilities, severance costs, continuing lease obligations and other wind-down costs -- of about $15 million. Shares traded down $12.79 to $18.16.

NovaDel Pharma(NVD) rose 11.8% after the company received an approvable letter from the Food and Drug Administration for NitroMist, which is used for relief of an attack or acute prophylaxis of angina pectoris caused by coronary artery disease. The company believes the FDA, which is not requiring any additional studies, will give NitroMist final approval as soon as the company completes its manufacturing process validation commitments. Once the product is approved, Par Pharmaceuticals(PRX) will market, sell and distribute NitroMist in the US and Canada. NovaDel, for its part, will receive milestone payments and royalties on product sales. Shares traded up 14 cents to $1.33.