Bausch & Lomb Seeing Stars

The company's shares plunge in premarket trading after it pulls a contact lens solution.
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Bausch & Lomb's

(BOL)

shares were sinking in premarket trading Tuesday, a day after the company said it stopped shipping a contact lens solution in the wake of questions about whether its use could be related to a serious eye infection.

The company said late Monday that it would withhold shipments of its ReNu with MoistureLoc solution in the U.S. following an increased number of reports of fungal infections among contact lens wearers.

In a statement on its Web site, the Food and Drug Administration said the Centers for Disease Control has received reports of 109 cases of suspected fungal keratitis, a rare infection that may cause vision loss.

Of 30 patients for which complete data are available, 28 were contact wearers and 26 remembered which products they used. All of those 26 reported using the ReNu solution, and five reported using other products in addition to ReNu.

The company said in a press release that available scientific evidence doesn't establish any type of ReNu solution as a cause of the infections.

"The CDC has not determined if these reports represent an increase of Fusarium keratitis infections and is continuing to investigate the association, if any, of these cases with any product," the company said. "Nonetheless, in the interest of public health, we will voluntarily suspend U.S. shipments of ReNu with MoistureLoc while we pursue all appropriate steps to bring this investigation to a definitive conclusion."

Shares of Bausch & Lomb were diving $10.69, or 18.6%, to $46.75. That puts the stock well beneath its lowest closing price of the last year at $57.17.

A number of Wall Street firms cut their ratings on Bausch & Lomb, including Goldman Sachs, J.P. Morgan, Piper Jaffray and First Albany.

The company noted that none of its other products is affected by the move.

Bausch & Lomb had already suspended sales of the ReNu solutions in Singapore and Hong Kong in February after multiple reports of fungal keratitis infections. Bausch & Lomb said in late March, though, that it believes that the root cause of the infections wasn't related to a specific contact lens or lens-care product. The company said many of the recorded cases in Asia involved poor patient compliance with lens care regimens.

The FDA said it is focusing on determining if certain behaviors, or specific products, increase the risk of infection. ReNu with MoistureLoc, a multipurpose solution for soft contact lenses, was launched in late 2004.