Amgen Hammered Anew

Updated from May 10

Advisers to the Food and Drug Administration say the agency should impose more restrictions on anemia drugs from Amgen(AMGN) and Johnson & Johnson(J&J), as well as order the companies to conduct more safety tests.

The recommendations Thursday by outside medical experts are bound to put pressure on the drugs' sales and the companies' stocks. Amgen lost $5.77, or 9.1%, to $57.33 on heavy volume. Shares of J&J skidded $1.61, or 2.5%, to $62.50, also in active trading.

The selling in Amgen continued Friday, as shares dropped $2.13 to $55.20 following downgrades by Citi and JPMorgan.

Amgen will be the hardest hit, especially by a request for additional, expensive and time-consuming clinical trials. Last year, the company's Aranesp had sales of $4.1 billion. Another Amgen anemia drug, Epogen, had sales of $2.5 billion. They accounted for 46% of Amgen's 2006 revenue.

Procrit produces sales of $3.2 billion for J&J, or about 6% of its total. Procrit and Epogen have the same active ingredient. J&J sells Procrit under license from Amgen.

The FDA isn't bound by its advisers' recommendations, but it usually follows their suggestions. The experts voted 17-0 for more clinical testing and 15-2 to recommend stronger warnings. By late afternoon, they were still debating specific restrictions.

Aranesp, Procrit and Epogen are approved to treat anemia in patients with chronic kidney failure and in cancer patients whose anemia is caused by chemotherapy. Epogen and Procrit also are approved for patients scheduled for major surgery to reduce potential blood transfusions and for the treatment of anemia due to a certain therapy for HIV patients.